Exhibit 10.45
SECOND AMENDED AND RESTATED LOAN AGREEMENT
AMONG
AMERICAN MOVIE CLASSICS COMPANY
AND
BRAVO COMPANY, AS BORROWERS;
THE GUARANTORS PARTY HERETO, AS GUARANTORS;
TD SECURITIES (USA) INC.
AND
BANC OF AMERICA SECURITIES LLC,
AS CO-LEAD ARRANGERS AND CO-BOOK RUNNERS;
BANK OF AMERICA, N.A., AS SYNDICATION AGENT;
GENERAL ELECTRIC CAPITAL CORPORATION
AND
CITICORP USA, INC., AS CO-DOCUMENTATION AGENTS;
TORONTO DOMINION (TEXAS), INC., AS ADMINISTRATIVE AGENT
AND
THE OTHER CREDIT PARTIES PARTY HERETO
W I T N E S S E T H:
WHEREAS, American Movie Classics Company, a New York general
partnership ("AMC"), as borrower, Canadian Imperial Bank of Commerce and Toronto
Dominion (Texas), Inc., as arranging agents and documentation agents, TD
Securities (USA) Inc. and CIBC World Markets Corp. (formerly known as CIBC
Xxxxxxxxxxx Corp.), as joint book managers and co-lead arrangers, Canadian
Imperial Bank of Commerce, as syndication agent, Toronto Dominion (Texas), Inc.,
as administrative agent, and the other Credit Parties (as defined therein) party
thereto are parties to that certain Amended and Restated Loan Agreement dated as
of May 12, 1999, as amended by that certain First Amendment to Amended and
Restated Loan Agreement dated as of June 28, 2000 and as amended by that certain
Second Amendment to Amended and Restated Loan Agreement dated as of April 2,
2001 (as amended, the "PRIOR LOAN AGREEMENT"); and
WHEREAS, the Borrower desires that the Credit Parties (as defined in
the Prior Loan Agreement) modify the existing credit facilities to provide,
among other things, for the addition of Bravo Company, a New York general
partnership ("BRAVO") as a borrower and the extension of the Maturity Date (as
defined in the Prior Loan Agreement) from March 31, 2006 to December 31, 2006,
and the Credit Parties (as defined in the Prior Loan Agreement) are willing to
do so in accordance with and subject to the terms and conditions set forth
herein; and
WHEREAS, AMC acknowledges and agrees that the security interest
granted to the Administrative Agent, on behalf of the Credit Parties (as defined
in the
Prior Loan Agreement), pursuant to the Prior Loan Agreement and the other Loan
Documents (as defined in the Prior Loan Agreement), shall remain outstanding and
in full force and effect in accordance with the Prior Loan Agreement and shall
continue to secure the Obligations (as defined herein); and
WHEREAS, each of AMC and the Credit Parties (as defined herein)
acknowledges and agrees that (a) the Obligations (as defined herein) represent,
among other things, the amendment, restatement, renewal, extension,
consolidation and modification of the Obligations (as defined in the Prior Loan
Agreement) arising in connection with the Prior Loan Agreement and other Loan
Documents (as defined in the Prior Loan Agreement) executed in connection
therewith; (b) AMC and the Credit Parties (as defined herein) intend that the
Prior Loan Agreement and the other Loan Documents (as defined in the Prior Loan
Agreement) executed in connection therewith and the collateral pledged
thereunder shall secure, without interruption or impairment of any kind, all
existing Indebtedness (as defined in the Prior Loan Agreement) under the Prior
Loan Agreement and the other Loan Documents (as defined in the Prior Loan
Agreement) executed in connection therewith as they may be amended, restated,
renewed, extended, consolidated and modified hereunder, together with all other
obligations hereunder; (c) all Liens (as defined in the Prior Loan Agreement)
evidenced by the Prior Loan Agreement and the other Loan Documents (as defined
in the Prior Loan Agreement) executed in connection therewith are hereby
ratified, confirmed and continued; and (d) the Loan Documents (as defined
herein) are intended to restate, renew, extend, consolidate, amend and modify
the Prior Loan Agreement and the other Loan Documents (as defined in the Prior
Loan Agreement) executed in connection therewith; and
WHEREAS, each of AMC and the Credit Parties (as defined herein) intend
that (a) the provisions of the Prior Loan Agreement and the other Loan Documents
(as defined in the Prior Loan Agreement) executed in connection therewith, to
the extent restated, renewed, extended, consolidated, amended and modified
hereby, be hereby superseded and replaced by the provisions hereof and of the
other Loan Documents (as defined herein); (b) the Notes (as defined herein)
restate, renew, extend, consolidate, amend, modify, replace, are substituted for
and supersede in its entirety, but do not extinguish, the Indebtedness (as
defined in the Prior Loan Agreement) arising under the Revolving Notes (as
defined in the Prior Loan Agreement) and the Overdraft Note (as defined in the
Prior Loan Agreement) issued pursuant to the Prior Loan Agreement; and (c) by
entering into and performing their respective obligations hereunder, this
transaction shall not constitute a novation.
NOW, THEREFORE, in consideration of the premises and the covenants and
agreements contained herein, and in order to induce the Credit Parties (as
defined herein) to consent to the addition of Bravo as a borrower hereunder and
the extension of the Maturity Date (as defined under the Prior Loan Agreement),
as well as for other good and valuable consideration, the receipt and adequacy
of all of the foregoing as legally
2
sufficient consideration being hereby acknowledged, the parties hereto each do
hereby agree that the Prior Loan Agreement is amended and restated to read as
follows:
ARTICLE 1 - DEFINITIONS.
For the purposes of this Agreement:
"ACCRUED TAX LIABILITIES" shall mean, for any period, payments accrued
from and after January 1, 2002, and allocable to the Borrowers in accordance
with the Tax Sharing Policy, which payments shall be determined on the basis of
the financial income, taxable income, credits and other amounts directly related
to the members of the RMG Tracking Stock Group which would generally be
comparable to those payments that would have resulted if the Borrowers had filed
separate tax returns.
"ACQUISITION" shall mean (a) any acquisition of all or substantially
all of the assets of a business or a business unit, (b) any acquisition of all
or substantially all of the capital stock or other ownership interest of any
other Person, or (c) any merger by any Borrower Party of or with any other
Person, such that, in any such case, such Person shall become consolidated with
such Borrower Party in accordance with GAAP after consummating such transaction.
"ADDITIONAL AMOUNTS" shall have the meaning set forth in Section
2.10(c)(ii) hereof.
"ADJUSTED STOCK INCENTIVE CHARGES" shall mean, for the MGM Operating
Companies on a consolidated basis, the result, to the extent positive, of (a)
Employee Stock Incentive Expense, MINUS (b) seven percent (7%) of Calendar
Operating Cash Flow for the immediately preceding fiscal year of the MGM
Operating Companies, MINUS (c) the lesser of (i) Employee Stock Incentive Income
attributable to the MGM Operating Companies during such period and (ii)
$25,000,000, in each case for the most recently completed twelve (12) month
period.
"ADMINISTRATIVE AGENT" shall mean Toronto Dominion (Texas), Inc., a
Delaware corporation, acting as administrative agent for the Credit Parties,
together with any successor administrative agent.
"ADMINISTRATIVE AGENT'S OFFICE" shall mean the office of the
Administrative Agent located at the address set forth in Section 12.1 hereof, or
such other office as may be designated pursuant to the provisions of Section
12.1 hereof.
"ADVANCE" or "ADVANCES" shall mean amounts advanced to either of the
Borrowers pursuant to Article 2 hereof on the occasion of any borrowing.
"AFFILIATE" shall mean any Person (other than a Person whose sole
relationship with a Borrower Party is as an employee) directly or indirectly
controlling,
3
controlled by, or under common control with any of the Borrower Parties. For
purposes of this definition, "control" when used with respect to any Person
includes the power to direct or cause the direction of the management and
policies of such Person, whether by contract or otherwise.
"AGENTS" shall mean, collectively, the Administrative Agent, the
Syndication Agent, the Co-Documentation Agents and the Arrangers, and "AGENT"
shall mean any one of the foregoing Agents.
"AGREEMENT" shall mean this Second Amended and Restated Loan
Agreement.
"AGREEMENT DATE" shall mean March 25, 2002.
"AMC" shall have the meaning ascribed thereto in the recitals to this
Agreement.
"ANNUALIZED CASH FLOW" shall mean, as of any calculation date for the
MGM Operating Companies on a consolidated basis, (a) the product of (i) the
result of (A) Cash Flow, PLUS (B) Employee Stock Incentive Expense, MINUS (C)
Employee Stock Incentive Income, in each case for the most recently completed
six (6) month period, TIMES (ii) two (2), MINUS (b) Adjusted Stock Incentive
Charges.
"ANNUALIZED INTEREST EXPENSE" shall mean the product of (a) Interest
Expense for the most recently completed two (2) fiscal quarters, times (b) two
(2).
"APPLICABLE LAW" shall mean, in respect of any Person, all provisions
of constitutions, statutes, rules, regulations and orders of governmental bodies
or regulatory agencies applicable to such Person and all orders and decrees of
all courts and arbitrators in proceedings or actions to which the Person in
question is a party or by which it is bound.
"ARRANGERS" shall mean, collectively, TD Securities (USA) Inc. and
Banc of America Securities LLC, in their respective capacities as co-lead
arrangers and co-book runners under this Agreement, and "ARRANGER" shall mean
any one of the foregoing Arrangers.
"ASSIGNMENT AND ASSUMPTION AGREEMENT" shall mean that certain form of
Assignment and Assumption Agreement in substantially the form of EXHIBIT A
attached hereto, pursuant to which each Lender may, as further provided in
Section 12.5 hereof, sell a portion of its Revolving Loans or Revolving Loan
Commitment.
"AUTHORIZED SIGNATORY" shall mean, with respect to any Person, such
senior personnel of such Person as may be duly authorized and designated in
writing by such Person to execute documents, agreements and instruments on
behalf of such Person.
4
"AVAILABLE BASKET AMOUNT" shall mean $50,000,000 in the aggregate
during the term of this Agreement.
"AVAILABLE FILM RIGHTS ADD-BACK" shall mean, with respect to any
period, (a) $100,000,000 minus (b) the aggregate amount of any Available Film
Rights Add-Backs used by the Borrowers to calculate Excess Film Rights Payments
with respect to any prior periods.
"AVAILABLE REVOLVING LOAN COMMITMENT" shall mean, as of any date, the
excess of (a) the Revolving Loan Commitment, over (b) the aggregate amount of
Revolving Loans outstanding on such date.
"AVOIDANCE PROVISIONS" shall have the meaning ascribed thereto in
Section 2.16(a) hereof.
"BANKRUPTCY CODE" shall mean the United States Bankruptcy Code (11
U.S.C. Section 101 ET SEQ.), as now or hereafter amended, and any successor
statute, or any other applicable federal or state bankruptcy law or other
similar law.
"BASE RATE" shall mean, as of any date, a fluctuating interest rate
per annum equal to the greater of (a) the Prime Rate and (b) the sum of (i) the
Federal Funds Rate, plus (ii) one-half of one percent (0.50%). The Base Rate
shall be adjusted automatically as of the opening of business on the effective
date of each change in the Prime Rate or the Federal Funds Rate, as the case may
be.
"BASE RATE ADVANCE" shall mean an Advance (other than a Swing Loan)
which a Borrower requests to be made as a Base Rate Advance or which is
converted to a Base Rate Advance in accordance with the provisions of Section
2.2 hereof.
"BASE RATE APPLICABLE MARGIN" shall mean, at any time, with respect to
any Base Rate Advance, one and three-quarters percent (1.75%) per annum.
"BORROWERS" shall mean, collectively, AMC and Bravo, and "BORROWER"
shall mean any one of the foregoing Borrowers.
"BORROWER PARTIES" shall mean, collectively, the Borrowers and the
Guarantors, and "BORROWER PARTY" shall mean any one of the foregoing Borrower
Parties.
"BORROWER PLEDGE AGREEMENT" shall mean that certain Amended and
Restated Pledge Agreement among the Borrowers and the Administrative Agent,
dated as of the Agreement Date, in substantially the form of EXHIBIT B attached
hereto, pursuant to which the Borrowers have pledged to the Administrative
Agent, for the ratable benefit of the Credit Parties, all of the stock and other
equity interests owned directly by each of them.
5
"BORROWER SECURITY AGREEMENT" shall mean that certain Amended and
Restated Security Agreement among the Borrowers and the Administrative Agent,
dated as of the Agreement Date, in substantially the form of EXHIBIT C attached
hereto.
"BRAVO" shall have the meaning ascribed thereto in the recitals to
this Agreement.
"BUSINESS DAY" shall mean a day on which banks are not authorized or
required to be closed and foreign exchange markets are open for the transaction
of business required for this Agreement in London, England, Houston, Texas, and,
in each case, New York, New York, as relevant to the determination to be made or
the action to be taken.
"CABLEVISION-NY GROUP STOCK" shall mean the series of common stock of
CSC designated as "Cablevision Systems Corporation-Cablevision NY Group Class A
Common Stock" and traded on the New York Stock Exchange under the symbol "CVC".
"CALENDAR OPERATING CASH FLOW" shall mean, as of each fiscal year end
for the MGM Operating Companies on a consolidated basis, (a) the result of (i)
Cash Flow, PLUS (ii) Employee Stock Incentive Expense, MINUS (iii) Employee
Stock Incentive Income, in each case for the twelve (12) month period then
ended, MINUS (b) Adjusted Stock Incentive Charges.
"CAPITAL EXPENDITURES" shall mean expenditures for the purchase of
assets of long-term use which are capitalized in accordance with GAAP (excluding
any expenditures for and under Film Rights Agreements).
"CAPITALIZED LEASE OBLIGATION" shall mean that portion of any
obligation of a Person as lessee under a lease which at the time would be
required to be capitalized on the balance sheet of such lessee in accordance
with GAAP.
"CASH EQUIVALENTS" shall mean the following:
(a) marketable, direct obligations of the United States of America
maturing within three hundred ninety-seven (397) days of the date of
purchase;
(b) commercial paper issued by any Lender (or any Lender Affiliate)
or by corporations, each of which shall have a consolidated net worth of at
least $250,000,000 and each of which conducts a substantial part of its
business in the United States of America, maturing within one hundred
eighty (180) days from the date of the original issue thereof, and rated
"P-1" or better by Xxxxx'x Investors Service, Inc.;
6
(c) fully collateralized repurchase agreements in such amounts and
with such financial institutions having a rating of Baa or better from
Xxxxx'x Investors Service, Inc., as the Borrowers may select from time to
time;
(d) certificates of deposit, banker's acceptances and time deposits
maturing within three hundred ninety-seven (397) days of the date of
purchase, which are issued by any Lender or by a United States national or
state bank or foreign bank having capital, surplus and undivided profits
totaling more than $100,000,000, and having a rating of Baa or better from
Xxxxx'x Investors Service, Inc.; and
(e) money market funds that (i) comply with the criteria set forth in
SEC Rule 2a-7 under the Investment Company Act of 1940, (ii) are rated AAA
by Standard & Poor's and Aaa by Moody's and (iii) have portfolio assets of
at least $5,000,000,000.
"CASH FLOW" shall mean, for any period, the sum of (a) Net Income
(excluding any unusual, non-recurring or extraordinary items), plus (b) the sum,
in each case to the extent deducted in calculating Net Income, of (i) Interest
Expense, (ii) depreciation, (iii) amortization (excluding Film Rights
Amortization and Deferred Carriage Fees) and (iv) taxes.
"CO-DOCUMENTATION AGENTS" shall mean, collectively, Citicorp USA, Inc.
and General Electric Capital Corporation, in their respective capacities as
co-documentation agents under this Agreement, and "CO-DOCUMENTATION AGENT" shall
mean any one of the foregoing Co-Documentation Agents.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"COLLATERAL" shall mean any assets in which any Credit Party may have
a security interest pursuant to any Security Document.
"COMMITMENT PERCENTAGES" shall mean the percentages in which the
Lenders are severally bound to satisfy the Revolving Loan Commitment to make
Advances to the Borrowers as shall be in effect from time to time, which
percentages as of the Agreement Date are set forth on SCHEDULE 1 hereto.
"COMMITMENTS" shall mean, collectively, the Revolving Loan Commitment
and any Incremental Facility Commitments issued hereunder.
"COMPANY" shall mean any corporation, partnership, limited liability
company or other legal entity.
7
"CONSTITUENT DOCUMENTS" shall mean, (a) with respect to any
corporation, such corporation's certificate or articles of incorporation and
by-laws, (b) with respect to any partnership, such partnership's partnership
agreement and certificate of limited partnership (if applicable), and (c) with
respect to any limited liability company, such limited liability company's
operating agreement and certification of organization (or other similar
document, as the case may be).
"CONSULTING AGREEMENT" shall mean that certain Consulting Agreement
dated as of March 29, 2001, among CSC Holdings, AMC and WE, pursuant to which
CSC Holdings has agreed to provide consulting services to AMC and WE for an
annual fee equal to three and one-half percent (3.50%) of the gross revenues of
AMC and WE during the applicable year and reimbursement of the costs and
expenses incurred by CSC Holdings in connection with the consulting services.
"CONTRIBUTING BORROWER" shall have the meaning ascribed thereto in
Section 2.16(c) hereof.
"CREDIT PARTIES" shall mean, collectively, the Administrative Agent,
the Syndication Agent, the Co-Documentation Agents, the Arrangers, the Lenders,
the Swing Loan Lender and the Incremental Facility Lenders.
"CSC" shall mean Cablevision Systems Corporation, a Delaware
corporation.
"CSC HOLDINGS" shall mean CSC Holdings, Inc., a Delaware corporation.
"DEBT SERVICE" shall mean, as of any date of determination, for the
MGM Operating Companies on a consolidated basis, the sum of (a) Annualized
Interest Expense, (b) cash taxes paid during the most recently completed twelve
(12) calendar month period, (c) Mandatory Commitment Reductions during the
immediately succeeding twelve (12) calendar month period, (d) scheduled payments
under Capitalized Lease Obligations during the immediately succeeding twelve
(12) calendar month period, and (e) Excess Film Rights Payments during the
immediately succeeding twelve (12) calendar month period.
"DEBT SERVICE RATIO" shall mean, on any calculation date, the ratio of
(a) Annualized Cash Flow to (b) Debt Service.
"DEFAULT" shall mean any Event of Default, and any of the events
specified in Section 9.1 hereof which with any passage of time or giving of
notice (or both) would constitute such event an Event of Default.
"DEFAULT RATE" shall mean a simple per annum interest rate equal to
the sum of (a) the Base Rate, (b) the Base Rate Applicable Margin, and (c) two
percent (2%).
8
"DEFERRED CARRIAGE FEES" shall mean the amortization of expenditures
of the MGM Operating Companies made in respect of launch support payments under
carriage agreements, which expenditures shall, at all times, be amortized in
accordance with GAAP.
"DOLLARS" or "$" shall mean the basic unit of the lawful currency of
the United States of America.
"EMPLOYEE STOCK INCENTIVE EXPENSE" shall mean, with respect to any
Person, the expense incurred for the respective period in respect of the
employee stock incentive programs of such Person, as determined in accordance
with GAAP.
"EMPLOYEE STOCK INCENTIVE INCOME" shall mean, with respect to any
Person, income attributable to such Person for the respective period as a result
of the reversal of any Employee Stock Incentive Expense accrued during a prior
period, as determined in accordance with GAAP.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as in effect from time to time.
"ERISA AFFILIATE" shall mean any "affiliate" of the Borrower Parties
within the meaning of Section 414 of the Code.
"EURODOLLAR ADVANCE" shall mean an Advance (other than a Swing Loan)
which a Borrower requests to be made as a Eurodollar Advance or which is
continued as or converted to a Eurodollar Advance in accordance with the
provisions of Section 2.3 hereof.
"EURODOLLAR ADVANCE PERIOD" shall mean, in connection with any
Eurodollar Advance, the term of such Advance selected by the applicable
Borrower, which may be one (1), two (2), three (3) or six (6) months, and
subject to the last proviso of this definition nine (9) or twelve (12) months,
or otherwise determined in accordance with this Agreement; PROVIDED, HOWEVER,
notwithstanding the foregoing, (a) any applicable Eurodollar Advance Period
which would otherwise end on a day which is not a Business Day shall be extended
to the next succeeding Business Day unless such Business Day falls in another
calendar month, in which case such Eurodollar Advance Period shall end on the
next preceding Business Day, (b) any applicable Eurodollar Advance Period which
begins on a day for which there is no numerically corresponding day in the
calendar month during which such Eurodollar Advance Period is to end shall
(subject to clause (a) above) end on the last day of such calendar month, and
(c) no Eurodollar Advance Period shall extend beyond the Maturity Date or such
earlier date as would interfere with the repayment obligations of the Borrowers
under Section 2.7 hereof; PROVIDED FURTHER, HOWEVER, a Borrower may not select a
Eurodollar Advance Period in excess of six (6) months unless the Administrative
Agent has notified the Borrowers that (i) that each of the Lenders has available
to it funds for such Lender's
9
share of the proposed Advance which are not required for other purposes, (ii)
such funds are available to each Lender at a rate (exclusive of reserves and
other adjustments) at or below the Eurodollar Rate for such proposed Advance and
Eurodollar Advance Period, and (iii) each Lender has, in its sole discretion,
agreed to fund such Advance.
"EURODOLLAR APPLICABLE MARGIN" shall mean, at any time, with respect
to any Eurodollar Advance, two and three-quarters percent (2.75%) per annum.
"EURODOLLAR BASIS" shall mean a simple per annum interest rate
(rounded upward, if necessary, to the nearest one-hundredth of one percent
(1/100%)) equal to the quotient of (a) the Eurodollar Rate divided by (b) one
minus the Eurodollar Reserve Percentage, stated as a decimal, and once
determined, shall be subject to Article 11 hereof and shall remain unchanged
during the applicable Eurodollar Advance Period, except for changes to reflect
adjustments in the Eurodollar Reserve Percentage.
"EURODOLLAR RATE" shall mean, for any Eurodollar Advance Period, the
rate per annum determined by the Administrative Agent to be the arithmetic mean
of the interest rates per annum (rounded upward to the nearest one-sixteenth of
one percent (1/16%)) which appear on Telerate Page 3750 as of 11:00 a.m. (London
time), or, if unavailable, the Reuters Screen LIBO Page, two (2) Business Days
before the first day of such Eurodollar Advance Period, in an amount
approximately equal to the principal amount of, and for a length of time
approximately equal to the Eurodollar Advance Period for, the Eurodollar Advance
sought by a Borrower.
"EURODOLLAR RESERVE PERCENTAGE" shall mean the percentage which is in
effect from time to time under Regulation D of the Board of Governors of the
Federal Reserve System, as such regulation may be amended from time to time, as
the actual reserve requirement applicable with respect to Eurocurrency
liabilities (as that term is defined in Regulation D), to the extent any Lender
has any Eurocurrency liabilities subject to such reserve requirement at that
time. The Eurodollar Basis for any Eurodollar Advance shall be adjusted as of
the effective date of any change in the Eurodollar Reserve Percentage.
"EVENT OF DEFAULT" shall mean any of the events specified in Section
9.1 hereof, provided that any requirement for notice or lapse of time, or both,
has been satisfied.
"EXCESS FUNDING GUARANTOR" shall have the meaning ascribed thereto in
Article 3 hereof.
"EXCESS FILM RIGHTS PAYMENTS" shall mean, for any period, the excess,
if any, of (a) feature film inventory over (b) film rights payable; PROVIDED,
HOWEVER, that, at the Borrowers' option, such excess may be reduced to not less
than zero (0) by all or any portion of the Available Film Rights Add-Back.
10
"EXCESS PAYMENT" shall have the meaning ascribed thereto in Article 3
hereof.
"EXEMPTION CERTIFICATE" shall have the meaning set forth in Section
2.10(c)(iii) hereof.
"FCC" shall mean the Federal Communications Commission, or any
successor thereto.
"FEDERAL FUNDS RATE" shall mean, as of any date, the weighted average
of the rates on overnight federal funds transactions with the 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 (3) federal
funds brokers of recognized standing selected by the Administrative Agent.
"FEE LETTERS" shall mean those certain Fee Letters by and among the
Borrowers and each of the Administrative Agent, the Arrangers and the Lenders
setting forth the applicable fees relating to this Agreement.
"FILM RIGHTS AGREEMENTS" shall mean, collectively, each agreement
between any of the Borrower Parties and any other Person for the agreement to
use, produce, exhibit or distribute programming.
"FILM RIGHTS AMORTIZATION" shall mean the amortization of expenditures
of the MGM Operating Companies for the acquisition of film rights and broadcast
programming, which expenditures shall, at all times, be amortized in accordance
with GAAP.
"FINANCIAL COVENANTS" shall mean the financial covenants applicable to
the Borrowers from time to time as set forth in Sections 8.8, 8.9 and 8.10
hereof.
"FINANCIAL STATEMENTS DELIVERY DATE" shall mean (a) with respect to
the delivery of quarterly financial statements and information pursuant to
Section 7.1 hereof, the date which is ninety (90) days after the last day of
each quarter in each fiscal year of the Borrowers, and (b) with respect to the
delivery of annual financial statements and information pursuant to Section 7.2
hereof, the date which is one hundred twenty (120) days after the end of each
fiscal year of the Borrowers; PROVIDED, HOWEVER, in the event the Securities and
Exchange Commission ("SEC") shall reduce the time period during which the
Borrowers may file their quarterly or annual financial statements with the SEC,
the ninety (90) day and one hundred twenty (120) day time periods set forth in
this definition shall be reduced by a like number of days.
11
"FOREIGN LENDER" shall have the meaning set forth in Section
2.10(c)(iii) hereof.
"FUNDING BORROWER" shall have the meaning ascribed thereto in Section
2.16(c) hereof.
"GAAP" shall mean generally accepted accounting principles in the
United States, as in effect from time to time, consistently applied.
"GUARANTEE SUPPLEMENT" shall have the meaning set forth in Section
6.14 hereof.
"GUARANTORS" shall mean all of the now or hereafter existing direct
and indirect Subsidiaries of either of the Borrowers.
"GUARANTY" or "GUARANTEED" as applied to an obligation (each a
"primary obligation"), shall mean and include (a) any guaranty, direct or
indirect, in any manner, of any part or all of such primary obligation, and (b)
any agreement, direct or indirect, contingent or otherwise, the practical effect
of which is to assure in any way the payment or performance (or payment of
damages in the event of non-performance) of any part or all of such primary
obligation, including, without limiting the foregoing, any reimbursement
obligations as to amounts drawn down by beneficiaries of outstanding letters of
credit and any obligation of a Person (the "primary obligor"), whether or not
contingent, (i) to purchase any such primary obligation or any property or asset
constituting direct or indirect security therefor, (ii) to advance or supply
funds (A) for the purchase or payment of such primary obligation or (B) to
maintain working capital, equity capital or the net worth, cash flow, solvency
or other balance sheet or income statement condition of any other Person, (iii)
to purchase property, assets, securities or services primarily for the purpose
of assuring the owner or holder of any primary obligation of the ability of the
primary obligor with respect to such primary obligation to make payment thereof,
or (iv) otherwise to assure or hold harmless the owner or holder of such primary
obligation against loss in respect thereof.
"INCREMENTAL FACILITY COMMITMENT" shall mean the commitment of any of
the Incremental Facility Lenders to make Incremental Facility Loans to the
Borrowers in accordance with Section 2.14 hereof. The Borrowers may obtain
Incremental Facility Commitments on a joint and several basis from more than one
Incremental Facility Lender, which commitments shall be several obligations of
each such Incremental Facility Lender.
"INCREMENTAL FACILITY INDEBTEDNESS" shall mean all principal,
interest, fees, and other amounts from time to time due or accrued in connection
with the Incremental Facility Loans.
12
"INCREMENTAL FACILITY LENDERS" shall mean any lenders having an
Incremental Facility Commitment or making Incremental Facility Loans pursuant
thereto.
"INCREMENTAL FACILITY LOANS" shall mean the amounts advanced by the
Incremental Facility Lenders to either of the Borrower as Incremental Facility
Loans under the Incremental Facility Commitment, not to exceed the amount of the
Incremental Facility Commitment, and evidenced by the Incremental Facility
Notes.
"INCREMENTAL FACILITY NOTES" shall mean those certain Incremental
Facility Notes described in Section 2.14 hereof.
"INDEBTEDNESS" shall mean, with respect to any Person, (a) all items
(except items of shareholders' and partners' equity or capital stock or surplus
or general contingency or deferred tax reserves) which in accordance with GAAP
would be included in determining total liabilities as shown on the liability
side of a balance sheet of such Person, (b) all direct or indirect obligations
secured by any Lien to which any property or asset owned by such Person is
subject, whether or not the obligation secured thereby shall have been assumed,
(c) to the extent not otherwise included, all Capitalized Lease Obligations of
such Person, (d) all reimbursement obligations with respect to outstanding
letters of credit, and (e) all net obligations in respect of Interest Hedge
Agreements.
"INDEBTEDNESS FOR MONEY BORROWED" shall mean, with respect to any
Person, all money borrowed by such Person and all Indebtedness represented by
notes payable by such Person and drafts accepted representing extensions of
credit to such Person, all obligations of such Person evidenced by bonds,
debentures, notes, or other similar instruments, all net obligations in respect
of Interest Hedge Agreements, all reimbursement obligations with respect to
letters of credit, all Indebtedness of such Person upon which interest charges,
commitment fees or letter of credit fees are customarily paid, and all
Indebtedness of such Person issued or assumed as full or partial payment for
property or services, whether or not any such notes, drafts, obligations, or
Indebtedness represent Indebtedness for money borrowed (excluding accounts
payable and other accruals incurred in the ordinary cause of business). For
purposes of this definition, interest which is accrued but not paid on the
original due date or within any applicable cure or grace period as provided by
the underlying contract for such interest shall be deemed Indebtedness For Money
Borrowed.
"INDEMNIFIED PARTIES" shall have the meaning given thereto in Section
6.13 hereof.
"INSOLVENCY PROCEEDING" shall mean, with respect to any Person, any
insolvency, receivership, bankruptcy, dissolution, liquidation or reorganization
proceeding, or any other proceeding, whether voluntary or involuntary, by or
against such Person, under the Bankruptcy Code or any other bankruptcy or
insolvency law or laws, federal or state, relating to the relief of debtors of
any jurisdiction, whether now or hereafter in effect, and any out-of-court
composition, assignment for the benefit of
13
creditors, readjustment of Indebtedness, reorganization, extension or other debt
arrangement of any kind.
"INTEREST COVERAGE RATIO" shall mean, on any calculation date, the
ratio of (a) Six Month Cash Flow to (b) Trailing Six Month Interest Expense.
"INTEREST EXPENSE" shall mean, for any period with respect to any
Person, an amount equal to the sum of (a) the interest and commitment fees
accrued during such period with respect to the aggregate amount of Indebtedness
For Money Borrowed and (b) the interest component of Capitalized Lease
Obligations.
"INTEREST HEDGE AGREEMENT" shall mean any interest rate swap, cap,
collar, floor, caption or swaption agreement, or any similar arrangement
designed to hedge the risk of variable interest rate volatility or to reduce
interest costs, arising at any time between any of the Borrower Parties, on the
one hand, and any other Person, on the other hand, as such agreement or
arrangement may be modified, supplemented, amended, and in effect from time to
time.
"INVESTMENT" shall mean any capital contributions to, loans to,
repurchase agreements with or investments in securities of, or Guaranties issued
for the benefit of, a Person (including, without limitation, any Affiliates of
the Borrower Parties), but in any case shall not include any Acquisition.
"LENDER AFFILIATE" shall mean with respect to any Lender, (i) an
Person directly or indirectly controlling, controlled by or under common control
with such Lender or (ii) any entity (whether a corporation, partnership, trust
or otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the ordinary course
of its business and is wholly-owned by a Lender or a Lender Affiliate of such
Lender.
"LENDERS" shall mean those lenders whose names are set forth on the
signature pages hereof under the heading "Lenders" (including the Swing Loan
Lender) and any assignees of the Lenders which hereafter become parties hereto
pursuant to and in accordance with Section 12.5 hereof, and "LENDER" shall mean
any one of the foregoing Lenders.
"LEVERAGE RATIO" shall mean, on any calculation date, the ratio of (a)
Total Debt to (b) Annualized Cash Flow.
"LIEN" shall mean, with respect to any property, any mortgage, lien,
pledge, assignment, charge, security interest, title retention agreement, levy,
execution, seizure, attachment, garnishment, or other encumbrance of any kind in
respect of such property, whether or not xxxxxx, vested, or perfected.
14
"LOAN DOCUMENTS" shall mean this Agreement, the Notes, the Fee
Letters, the Security Documents, the Subordination of Fees Agreement, the
Subordination of Tax Liabilities Agreement, all Incremental Facility Notes and
other documents executed in connection with the Incremental Facility Loans, all
Requests for Advance, all documents executed by any of the Borrower Parties
pursuant to Section 6.14 hereof, and all other documents, instruments,
certificates and agreements executed or delivered in connection with or
contemplated by this Agreement.
"LOANS" shall mean, collectively, the Revolving Loans and the Swing
Loans and, if any Incremental Facility Commitments have been issued hereunder,
the Incremental Facility Loans made under such Incremental Facility Commitments,
and "LOAN" shall mean any of the foregoing.
"MAJORITY LENDERS" shall mean, at any time, (a) prior to the
occurrence of an Event of Default and termination of the Commitments, Lenders
the sum of whose Undrawn Commitments plus Loans then outstanding equals or
exceeds fifty and one-tenth percent (50.1%) of the sum of the Undrawn
Commitments plus Loans then outstanding for all Lenders, or (b) at any time that
there exists an Event of Default hereunder, and the Commitments have been
terminated, Lenders the total of whose Loans outstanding equals or exceeds fifty
and one-tenth percent (50.1%) of the total principal amount of the Loans then
outstanding hereunder.
"MANAGING PARTNERS" shall mean (a) with respect to AMC, American Movie
Classics Holding Corporation, a New York corporation, and (b) with respect to
Bravo, Bravo Holding Corporation, a Delaware corporation.
"MANDATORY BORROWING" shall have the meaning given thereto in Section
2.8(b) hereof.
"MANDATORY COMMITMENT REDUCTIONS" shall mean, as of any calculation
date, the excess, if any, of (a) the aggregate principal amount of the Revolving
Loans and the Swing Loans outstanding at the beginning of the period being
measured, over (b) the lowest amount of the Revolving Loan Commitment during the
period being measured.
"MATERIAL FILM RIGHTS AGREEMENTS" shall mean any Film Rights Agreement
of any Borrower Party pursuant to which such Borrower Party is obligated to make
payments of $5,000,000 or more in the aggregate.
"MATERIAL MSO AGREEMENT" shall mean any MSO Agreement covering
1,000,000 or more subscribers.
"MATERIALLY ADVERSE EFFECT" shall mean any materially adverse effect
upon the business, assets, financial condition or results of operations of the
Borrower Parties, taken as a whole on a consolidated basis in accordance with
GAAP, or upon the ability of
15
the Borrower Parties, taken as a whole, to perform their respective Obligations
under this Agreement or any other Loan Document.
"MATURITY DATE" shall mean December 31, 2006, or such earlier date as
payment of the Loans shall be due (whether by acceleration or otherwise);
PROVIDED, HOWEVER, in the event that, on or before September 1, 2005, (a) MGM's
option to put to RMHI the equity interest in the Borrowers held by the MGM
Partner shall not have been terminated or extended until after December 31,
2006, or (b) RMHI and the RMG Partners shall not have entered into an agreement,
in form and substance reasonably satisfactory to the Arrangers, in favor of the
Credit Parties providing that RMHI and the RMG Partners will satisfy the MGM put
solely in either Cablevision-NY Group Stock or RMG Tracking Stock, the Maturity
Date shall be accelerated to November 1, 2005.
"MAXIMUM BORROWER LIABILITY" shall have the meaning ascribed thereto
in Section 2.16(a) hereof.
"MGM" shall mean Metro-Xxxxxxx-Xxxxx Inc., a Delaware corporation.
"MGM OPERATING COMPANIES" shall mean all Borrower Parties which are
designated as of the Agreement Date as MGM Operating Companies on SCHEDULE
5.1(C) hereto, and "MGM OPERATING COMPANY" shall mean any one of the foregoing
MGM Operating Companies; PROVIDED, HOWEVER, that so long as no Default or Event
of Default then exists or would be caused thereby, the Borrowers may designate
additional Borrower Parties as MGM Operating Companies after the Agreement Date,
upon five (5) Business Days' prior written notice to the Administrative Agent;
PROVIDED FURTHER, HOWEVER, that notwithstanding the foregoing, no Company which
is or becomes a MGM Operating Company shall cease to be a MGM Operating Company
for purposes of this Agreement without the consent of the Majority Lenders.
"MGM PARTNER" shall mean MGM Networks, U.S., Inc., a Delaware
corporation.
"MSO AGREEMENT" shall mean any agreement between any Borrower Party
and a cable television operator pursuant to which such operator agrees, among
other things, to distribute and exhibit to its subscribers programming of such
Borrower Party.
"MULTIEMPLOYER PLAN" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"NECESSARY AUTHORIZATIONS" shall mean all authorizations, consents,
permits, approvals, licenses and exemptions from, and all filings and
registrations with, and all reports to, any governmental or other regulatory
authority whether federal, state or local, and all agencies thereof necessary
for the conduct of the businesses and the ownership (or lease) of the properties
and assets of the Borrower Parties.
16
"NET CASH PROCEEDS" shall mean, with respect to any issuance or sale
by any Person of Indebtedness or stock or other equity interests, and with
respect to any sale, lease, transfer or other disposition of assets, the amount
equal to (a) the gross cash consideration (including, without limitation, any
payments received in respect of covenants not to compete, consulting or
management fees, and any portion of the amount received in cash upon payment of
a buyer promissory note or other evidence of Indebtedness) in connection with
such issuance, sale, lease, transfer or other disposition, minus (b) the sum of
(i) any underwriting or commitment fees or sales commissions required to be paid
on the closing of such transaction, (ii) any attorneys fees incurred by such
Person in connection with such transaction, and (iii) cash taxes related to the
transaction to the extent payable by such Person.
"NET INCOME" shall mean, with respect to any Person for any period,
the aggregate amount of net income of such Person, after taxes (unless such
Person is a partnership or limited liability company), for such period as
determined in accordance with GAAP.
"NEW AFFILIATED EQUITY" shall mean any infusion of equity by RMG,
RMHI, CSC, MGM, any affiliate of any of them or any other Person satisfactory to
the Majority Lenders into either of the Borrowers after the Agreement Date
whether the amount of such equity shall have been obtained by any such Person in
connection with the public issuance of stock or other equity interests by such
Person (including, without limitation, the issuance of any RMG Tracking Stock)
or otherwise.
"NOTES" shall mean, collectively, the Revolving Notes and the Swing
Loan Notes.
"NOTICE OF CONTINUATION/CONVERSION" shall mean a notice in
substantially the form of EXHIBIT D attached hereto.
"OBLIGATIONS" shall mean (a) all payment and performance obligations
of the Borrowers and all other obligors to the Lenders, the Swing Loan Lender,
the Incremental Facility Lenders, the Administrative Agent and the other Credit
Parties under this Agreement and the other Loan Documents, as they may be
amended from time to time, or as a result of making the Loans or the Incremental
Facility Loans, and (b) the obligation to pay an amount equal to the amount of
any and all damages which the Lenders, the Swing Loan Lender, the Incremental
Facility Lenders, the Administrative Agent or the other Credit Parties, or any
of them, or any of their Lender Affiliates, may suffer by reason of a breach by
either of the Borrowers or any other obligor of any obligation, covenant or
undertaking with respect to this Agreement or any other Loan Document.
"OTHER DEBTOR RELIEF LAW" shall have the meaning ascribed thereto in
Section 2.16(a) hereof.
17
"PARTNERSHIP PLEDGE AGREEMENT" shall mean that certain Partnership
Pledge Agreement among RMHI, the RMG Partners and the Administrative Agent, for
the ratable benefit of the Credit Parties, dated as of the Agreement Date, in
substantially the form of EXHIBIT E attached hereto, pursuant to which RMHI and
the RMG Partners have pledged to the Administrative Agent, for the ratable
benefit of the Credit Parties, all of their respective rights in and to the
Constituent Documents of AMC and Bravo, including, without limitation, the
equity interests owned by each of the RMG Partners in AMC and Bravo, which
pledge shall be subordinated to a Lien on such Collateral in favor of the RMG
Credit Parties.
"PAYING AFFILIATED BASIC SUBSCRIBERS" shall mean any Person which is a
subscriber carried and paid for pursuant to (a) any MSO Agreement existing on
the Agreement Date or arising after the Agreement Date or (b) any such MSO
Agreement which expires or has expired, provided that negotiations are
continuing in good faith to renew or extend such expired MSO Agreement and
following the expiration of such MSO Agreement, the programming of the Borrower
Parties continues to be exhibited, distributed and paid for by the applicable
pay television distributor under its existing terms or under terms no less
favorable to the Borrower Parties than such existing terms.
"PAYMENT DATE" shall mean the last day of each Eurodollar Advance
Period.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor thereto.
"PERMITTED INVESTMENTS" shall mean Investments described in and
permitted to be made under Section 8.2 hereof.
"PERMITTED LIENS" shall mean, as applied to any Person:
(a) Any Lien in favor of any Credit Party given to secure the
Obligations;
(b) Liens in favor of the RMG Credit Parties on the rights of RMHI
and the RMG Partners under the Constituent Documents of the Borrowers and on the
equity interests owned by the RMG Partners in the Borrowers, all of which Liens
are senior to the Liens on such Collateral granted to the Administrative Agent
pursuant to the Partnership Pledge Agreement;
(c) (i) Liens on real estate for real estate taxes not yet delinquent
and (ii) Liens for taxes, assessments, judgments, governmental charges or
levies, or claims the non-payment of which is being contested in good faith by
appropriate proceedings and for which adequate reserves have been set aside on
such Person's books, but only so long as no foreclosure, distrait, sale, or
similar proceedings have been commenced with
18
respect thereto and remain unstayed for a period of thirty (30) days after
their commencement;
(d) Liens of carriers, warehousemen, mechanics, laborers, and
materialmen incurred in the ordinary course of business for sums not yet due or
being contested in good faith, if such reserve or appropriate provision, if any,
as shall be required by GAAP shall have been made therefor;
(e) Liens incurred in the ordinary course of business in connection
with worker's compensation and unemployment insurance;
(f) Restrictions on the transfer of assets imposed by any agreement
(other than any agreement relating to Indebtedness), or by any federal, state or
local statute, regulation or ordinance applicable to such Person;
(g) Easements, rights-of-way, restrictions, and other similar
encumbrances on the use of real property which do not interfere with the
ordinary conduct of the business of such Person, or Liens on real property
incidental to the conduct of the business of such Person or to the ownership of
its real properties which were not incurred in connection with Indebtedness or
other extensions of credit and which do not in the aggregate materially detract
from the value of such properties or materially impair their use in the
operation of the business of such Person; and
(h) Liens in respect of Capitalized Lease Obligations permitted under
this Agreement.
"PERSON" shall mean an individual, Company, unincorporated
organization, or a government or any agency or political subdivision thereof.
"PLAN" shall mean, with respect to the Borrower Parties, an employee
benefit plan within the meaning of Section 3(3) of ERISA sponsored or maintained
by or contributed to by any of the Borrower Parties for the benefit of employees
of such Borrower Parties, as the case may be, but excluding any Multiemployer
Plan.
"PRIME RATE" shall mean, at any time, the rate of interest adopted by
The Toronto-Dominion Bank, New York Branch, as its reference rate for the
determination of interest rates for loans of varying maturities in United States
dollars to United States residents of varying degrees of creditworthiness and
being quoted at such time by such bank as its "prime rate." The Prime Rate is
not necessarily the lowest rate of interest charged to borrowers of The
Toronto-Dominion Bank, New York Branch.
"PRIOR LOAN AGREEMENT" shall have the meaning ascribed thereto in the
recitals to this Agreement.
19
"PRO RATA SHARE" shall have the meaning ascribed thereto in Article 3
hereof.
"REGULATORY CHANGE" shall mean, with respect to any Lender, any change
on or after the Agreement Date in United States Federal, state or foreign laws
or regulations (including, without limitation, Regulation D of the Board of
Governors of the Federal Reserve System) or the adoption or making on or after
such date of any interpretations, directives or requests applying to a class of
banks including such Lender of or under any United States Federal or state, or
any foreign, laws or regulations (whether or not having the force of law) by any
court or governmental or monetary authority charged with the interpretation or
administration thereof.
"REPORTABLE EVENT" shall have the meaning set forth in Section 4043 of
ERISA, other than an event for which the reporting requirement has been waived
by regulations promulgated under such Section.
"REQUEST FOR ADVANCE" shall mean any certificate signed by an
Authorized Signatory of a Borrower requesting an Advance (other than a Swing
Loan) hereunder, which certificate shall be in substantially the form of EXHIBIT
F attached hereto.
"RESTRICTED PAYMENT" shall mean (a) any direct or indirect
distribution, dividend or other payment to any Person on account of any shares
of capital stock or other securities of any of the Borrower Parties, (b) any
payment of consulting or management fees, or any interest thereon, by any of the
Borrower Parties to CSC or to any other Affiliate of the Borrower Parties, or to
any other Person, including, without limitation, payments under the Consulting
Agreement or the Services Agreement, and (c) any payment of amounts due in
respect of Accrued Tax Liabilities pursuant to the Tax Sharing Policy.
"RESTRICTED PURCHASE" shall mean any payment on account of the
purchase, redemption, or other acquisition or retirement of any shares of
capital stock or other securities of any of the Borrower Parties, including,
without limitation, any warrants or other rights or options to acquire shares of
capital stock or other securities of any of the Borrower Parties.
"REVOLVING LOAN COMMITMENT" shall mean the several obligations of the
Lenders to advance the sum of up to $200,000,000 to the Borrowers, on or after
the Agreement Date, in accordance with their respective Commitment Percentages
and as such amount may be reduced from time to time, all pursuant to the terms
hereof.
"REVOLVING LOANS" shall mean, collectively, the amounts advanced by
the Lenders to the Borrowers under the Revolving Loan Commitment, not to exceed
the amount of the Revolving Loan Commitment, and evidenced by the Revolving
Notes.
20
"REVOLVING NOTES" shall mean those certain promissory notes in the
aggregate original principal amount of $200,000,000, one such note issued by the
Borrowers, on a joint and several basis, to each of the Lenders in accordance
with such Lender's Commitment Percentage, each one in substantially the form of
EXHIBIT G attached hereto, and any extensions, modifications, renewals or
replacements of or amendments to any of the foregoing.
"RMG" shall mean Rainbow Media Group, LLC, a Delaware limited
liability company.
"RMG CREDIT PARTIES" shall mean "Credit Parties" as such term is
defined in the RMG Loan Agreement.
"RMG LOAN AGREEMENT" shall mean that certain Loan Agreement dated as
of the Agreement Date among RMG, as borrower, TD Securities (USA) Inc. and Banc
of America Securities LLC, as co-lead arrangers and co-book runners, Bank of
America, N.A., as syndication agent, Toronto Dominion (Texas), Inc., as
administrative agent and the other RMG Credit Parties party thereto.
"RMG PARTNERS" shall mean, collectively, American Movie Classics
Holding Corporation, a New York corporation, AMC II Holding Corporation, a
Delaware corporation, Bravo Holding Corporation, a Delaware corporation, and
Bravo II Holding Corporation, a Delaware corporation, and "RMG PARTNER" shall
mean any one of the foregoing RMG Partners.
"RMG TRACKING STOCK" shall mean capital stock of CSC designated as
"Cablevision Systems Corporation-Rainbow Media Group Class A Common Stock."
"RMHI" shall mean Rainbow Media Holdings, Inc., a Delaware
corporation.
"SECURITY DOCUMENTS" shall mean the Borrower Pledge Agreement, the
Borrower Security Agreement, the Partnership Pledge Agreement, the Subsidiary
Pledge Agreement, the Subsidiary Security Agreement, the Trademark Security
Agreement, any other agreement or instrument providing Collateral for the
Obligations whether now or hereafter in existence, and any filings, instruments,
agreements and documents related thereto and providing the Administrative Agent,
for the ratable benefit of the Credit Parties, with Collateral for the
Obligations.
"SERVICES AGREEMENT" shall mean, collectively, those certain Services
Agreements identified on SCHEDULE 8.10 attached hereto.
"SIX MONTH CASH FLOW" shall mean the result of (a) Annualized Cash
Flow, divided by (b) two (2).
21
"SOLVENT" shall mean, with respect to any Person on any date, that on
such date (a) the fair value of the property (tangible or intangible) of such
Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person, (b) the amount that will be
required to pay the probable liabilities of such Person on its debts as they
become absolute and matured will not be greater than the fair salable value of
the assets of such Person at such time, (c) such Person is able to realize upon
its assets and pay its debts and other liabilities, contingent obligations and
other commitments as they mature in the normal course of business, and (d) such
Person is not engaged in a business or a transaction, and is not about to engage
in a business or a transaction, for which such Person's property would
constitute unreasonably small capital after giving due consideration to
prevailing practices in the industry in which such Person is engaged. In
computing the amount of any contingent liability at any time, it is intended
that such liability will be computed at the amount which, in light of all the
facts and circumstances existing at such time, represents the amount that might
reasonably be expected to become an actual or matured liability.
"SUBORDINATED TAX LIABILITIES" shall mean payments accrued prior to
January 1, 2002, and allocable to the Borrowers in accordance with the Tax
Sharing Policy, which payments shall be determined on the basis of the financial
income, taxable income, credits and other amounts directly related to the
members of the RMG Tracking Stock Group which would generally be comparable to
those payments that would have resulted if the Borrowers had filed separate tax
returns, which payments have been subordinated to the Obligations pursuant to
the Subordination of Tax Liabilities Agreement.
"SUBORDINATION OF FEES AGREEMENT" shall mean that certain
Subordination of Fees Agreement, dated as of the Agreement Date, among the
Administrative Agent, CSC Holdings, AMC, WE and any other affiliate of CSC
Holdings that is a party to the Consulting Agreement or the Services Agreement,
pursuant to which the payment of fees and reimbursement of expenses under the
Consulting Agreement and the Services Agreement have been subordinated to the
Obligations as provided therein, which shall be in substantially the form of
EXHIBIT H attached hereto.
"SUBORDINATION OF TAX LIABILITIES AGREEMENT" shall mean that certain
Subordination of Tax Liabilities Agreement, dated as of the Agreement Date,
among the Administrative Agent, the Borrowers, RMG and RMHI in form and
substance satisfactory to the Arrangers.
"SUBSIDIARY" shall mean, as applied to any Person, (a) any corporation
of which fifty percent (50%) or more of the outstanding stock (other than
directors' qualifying shares) having ordinary voting power to elect a majority
of its board of directors, regardless of the existence at the time of a right of
the holders of any class or classes of securities of such corporation to
exercise such voting power by reason of the happening of any contingency, or any
partnership or other Company of which fifty
22
percent (50%) or more of the outstanding partnership or other equity interests,
is at the time owned directly or indirectly by such Person, or by one or more
Subsidiaries of such Person, or by such Person and one or more Subsidiaries of
such Person, and (b) any other entity which is controlled or capable of being
controlled by such Person, or by one or more Subsidiaries of such Person, or by
such Person and one or more Subsidiaries of such Person.
"SUBSIDIARY PLEDGE AGREEMENT" shall mean that certain Subsidiary
Pledge Agreement between each Guarantor having one or more Subsidiaries and the
Administrative Agent, for the ratable benefit of the Credit Parties, dated as of
the Agreement Date, in substantially in the form of EXHIBIT I attached hereto,
and any similar pledge agreement or any pledge agreement supplement delivered
pursuant to Section 6.14 hereof, pursuant to which each such Guarantor has
pledged to the Administrative Agent, for the ratable benefit of the Credit
Parties, all of the stock and other equity interests owned by it.
"SUBSIDIARY SECURITY AGREEMENT" shall mean that certain Subsidiary
Security Agreement between each Guarantor and the Administrative Agent, for the
ratable benefit of the Credit Parties, dated as of the Agreement Date, in
substantially the form of EXHIBIT J attached hereto, and any similar security
agreement or any security agreement supplement delivered pursuant to Section
6.14 hereof.
"SUPER-MAJORITY LENDERS" shall mean, at any time, (a) prior to the
occurrence of an Event of Default and termination of the Commitments, Lenders
the sum of whose Undrawn Commitments plus Loans then outstanding equals or
exceeds sixty-six and two-thirds percent (66-2/3%) of the sum of the Undrawn
Commitments plus Loans then outstanding for all Lenders, or (b) at any time
there exists an Event of Default hereunder, and the Commitments have been
terminated, Lenders the total of whose Loans outstanding equals or exceeds
sixty-six and two-thirds percent (66-2/3%) of the total principal amount of the
Loans then outstanding hereunder.
"SWING LOAN COMMITTED AMOUNT" shall mean $5,000,000.
"SWING LOANS" shall mean revolving loans made to the Borrowers by the
Swing Loan Lender from time to time in the Swing Loan Lender's sole discretion
and for the Swing Loan Lender's account, which revolving loans shall be made in
accordance with Sections 2.1(b) and 2.8 hereof.
"SWING LOAN LENDER" shall mean any Lender or the Administrative Agent
as agreed to at any time by the Borrowers and such Lender or the Administrative
Agent, in either case as designated in accordance with this Agreement. The
initial Swing Loan Lender shall be Toronto Dominion (Texas), Inc..
"SWING LOAN NOTE" shall mean that certain Swing Loan Note dated as of
the Agreement Date, in the principal amount of $5,000,000, issued by the
Borrowers, on
23
a joint and several basis, to the Swing Loan Lender, substantially in the form
of EXHIBIT K attached hereto, and any amendments, replacements, extensions or
renewals thereof.
"SWING LOAN REQUEST" shall have the meaning set forth in Section
2.8(a)(i) hereof.
"SYNDICATION AGENT" shall mean Bank of America, N.A., in its capacity
as syndication agent under this Agreement.
"TAX SHARING POLICY" shall mean the policy applicable to CSC, RMHI,
RMG and the Borrowers, among others, with respect to the allocation of tax
liabilities and other tax-related items between the "Cablevision NY Group" and
the "Rainbow Media Group", based principally upon the financial income, taxable
income, credits and other amounts directly related to the respective parties as
set forth in the Cablevision Systems Corporation Proxy Statement dated October
10, 2000, as amended and supplemented.
"TAXES" shall have the meaning set forth in Section 2.10(c)(i) hereof.
"TOTAL DEBT" shall mean, as of any date without duplication, with
respect to the MGM Operating Companies on a consolidated basis (a) all
outstanding Indebtedness For Money Borrowed, (b) all obligations Guaranteed by
the MGM Operating Companies in respect of Indebtedness for Money Borrowed, (c)
all Capitalized Lease Obligations (other than obligations under Film Rights
Agreements), and (d) all Accrued Tax Liabilities.
"TRADEMARK SECURITY AGREEMENT" shall mean that certain Trademark
Security Agreement between each Borrower Party owning any trademarks or
trademark applications and the Administrative Agent, for the ratable benefit of
the Credit Parties, dated as of the Agreement Date, substantially in the form of
EXHIBIT L attached hereto, and any similar pledge agreement or any pledge
agreement supplement delivered pursuant to Section 6.14 hereof.
"TRAILING SIX MONTH INTEREST EXPENSE" shall mean Interest Expense for
the MGM Operating Companies on a consolidated basis for the most recently
completed six (6) month period.
"TRANSPONDER LEASE AGREEMENT" shall mean any agreement by and between
any of the Borrower Parties and any other Person for the license, lease or other
agreement to use telecommunications satellites for purposes of broadcasting the
programming of such Borrower Parties and any other agreement related to the
transmission, origination and production of such programming and the related
technical services.
24
"UNDRAWN COMMITMENTS" shall mean, collectively, the undrawn amount of
the Revolving Loan Commitment, together with the undrawn amount of all
Incremental Facility Commitments.
"UNUSED PERCENTAGE" shall mean, on any date, the ratio, expressed as a
percentage, of (a) the Available Revolving Loan Commitment to (b) the Revolving
Loan Commitment.
"WE" shall mean WE: Women's Entertainment LLC, a Delaware limited
liability company, formerly Romance Classics, LLC.
Each definition of an agreement in this Article 1 shall include such
agreement as amended, restated, supplemented or otherwise modified (and, to the
extent applicable, as renewed or extended) from time to time provided that, if
required pursuant to the terms of this Agreement, the prior written consent of
the Majority Lenders (or such other composition of Lenders as may be required
under Section 12.12 hereof) shall have been given with respect to such
amendment, restatement, supplement or other modification. Except where the
context otherwise requires, definitions imparting the singular shall include the
plural and vice versa. Except where otherwise specifically restricted, reference
to a party to a Loan Document includes that party and its successors and
assigns. An Event of Default shall "exist", "continue" or be "continuing" until
such Event of Default has been waived in writing in accordance with Section
12.12 hereof. All terms used herein which are defined in Article 9 of the
Uniform Commercial Code in effect in the State of New York on the date hereof
and which are not otherwise defined herein shall have the same meanings herein
as set forth therein.
All accounting terms used herein without definition shall be used as
defined under GAAP. In the event that changes in GAAP during the term of this
Agreement would result in the defined terms set forth in this Article 1 or the
Financial Covenants being calculated in a different manner or with different
components or rendering the same not meaningful criteria for evaluating the MGM
Operating Companies, financial condition, the Borrowers and the Arrangers agree
to propose to the Credit Parties, and to vote affirmatively with respect to, any
amendments to this Agreement that the Borrowers and the Arrangers shall
determine are reasonably necessary to conform the defined terms set forth in
this Article 1 and the Financial Covenants so that the criteria for evaluating
the matters contemplated by Sections 8.8 and 8.9 hereof are substantially the
same criteria as were effective prior to such change in GAAP. Unless otherwise
expressly stated herein, all references to financial information and results of
the MGM Operating Companies shall be determined on a consolidated basis.
ARTICLE 2 - LOANS.
Section 2.1 THE LOANS. Subject to the terms and conditions of, and in
reliance upon the representations and warranties made in, this Agreement and the
other
25
Loan Documents, the Lenders have extended the Revolving Loan Commitment and
agree, severally in accordance with their respective Commitment Percentages and
not jointly, to make Loans to the Borrowers in an aggregate principal amount not
to exceed Two Hundred Million Dollars ($200,000,000).
(a) THE REVOLVING LOANS. The Lenders agree, severally in
accordance with their respective Commitment Percentages and not jointly, upon
the terms and subject to the conditions of this Agreement, to lend and re-lend
to the Borrowers, on and after the Agreement Date, but prior to the Maturity
Date, amounts which, in the aggregate, together with the principal amount of any
Swing Loans outstanding at any time, do not exceed the Revolving Loan
Commitment. Subject to the terms and conditions hereof and prior to the Maturity
Date, Advances under the Revolving Loan Commitment may be repaid and reborrowed
from time to time on a revolving basis or may be continued or converted pursuant
to a Notice of Continuation/Conversion as provided in Section 2.2 hereof.
(b) THE SWING LOANS. Subject to the terms and conditions
hereinafter set forth, including, without limitation, Section 2.8 hereof, the
Swing Loan Lender, in its individual capacity, may in its sole discretion make
revolving loans to the Borrowers (each a "SWING LOAN" and, collectively, the
"SWING LOANS") from time to time on and after the Agreement Date, but prior to
the Maturity Date, for the purposes hereinafter set forth; PROVIDED, HOWEVER,
that (i) the aggregate amount of Swing Loans outstanding at any time shall not
exceed the Swing Loan Committed Amount, and (ii) the sum of Revolving Loans,
plus Swing Loans outstanding at any time shall not exceed the Revolving Loan
Commitment. Swing Loans hereunder may be repaid and reborrowed in accordance
with the provisions hereof.
(c) USE OF PROCEEDS. The proceeds of the Loans may be used
solely (i) to make Restricted Payments to the RMG Partners and the MGM Partner
to the extent permitted under this Agreement, (ii) to make Permitted Investments
and Acquisitions to the extent permitted under this Agreement, and (iii) for
working capital and other general corporate purposes of the Borrower Parties.
Section 2.2 MANNER OF BORROWING AND DISBURSEMENT.
(a) CHOICE OF INTEREST RATE, ETC. Any Advance of the Revolving
Loans shall, at the option of the Borrowers, be made as a Base Rate Advance or a
Eurodollar Advance; PROVIDED, HOWEVER, that (i) if the Borrowers fail to give
the Administrative Agent telephonic notice specifying whether a Eurodollar
Advance is to be repaid, continued or converted on a Payment Date, such
Eurodollar Advance shall be converted to a Base Rate Advance on such Payment
Date, and (ii) the Borrowers may not select a Eurodollar Advance if, at the time
of such selection, a Default or Event of Default has occurred and is continuing.
Eurodollar Advances shall in all cases be subject to Article 11 hereof. Any
notice given to the Administrative Agent in connection with a requested Advance
hereunder shall be given to the Administrative Agent prior to 11:00
26
a.m. (New York time) in order for such Business Day to count toward the minimum
number of Business Days required.
(b) BASE RATE ADVANCES.
(i) INITIAL AND SUBSEQUENT ADVANCES. A Borrower shall
give the Administrative Agent in the case of Base Rate Advances, irrevocable
notice not later than 11:00 a.m. (New York time) on the date of the requested
Advance by telephone followed immediately by a Request for Advance. Upon receipt
of such notice, the Administrative Agent shall promptly notify each Lender by
telephone or telecopy of the contents thereof.
(ii) REPAYMENTS AND CONVERSIONS. A Borrower may (A) repay
or prepay a Base Rate Advance upon prior irrevocable telephonic notice to the
Administrative Agent not later than 11:00 a.m. (New York time) on the date of
repayment or prepayment, or (B) convert all or a portion of the principal amount
of a Base Rate Advance to one or more Eurodollar Advances upon prior irrevocable
written notice to the Administrative Agent not later than 11:00 a.m. (New York
time) on the date three (3) Business Days prior to such conversion in the form
of a Notice of Conversion/Continuation, or notice by telephone or telecopy
followed immediately by a Notice of Conversion/Continuation. On the date
indicated by the applicable Borrower, such Base Rate Advance shall be so repaid
or, as applicable, converted.
(iii) MISCELLANEOUS. Notwithstanding any term or provision
of this Agreement which may be construed to the contrary, each Base Rate Advance
shall be in a principal amount of at least $1,000,000 and in integral multiples
of $500,000 in excess thereof, or the remaining amount of the Revolving Loan
Commitment.
(c) EURODOLLAR ADVANCES.
(i) INITIAL AND SUBSEQUENT ADVANCES. A Borrower shall
give the Administrative Agent, in the case of Eurodollar Advances, irrevocable
telephonic notice followed by a Request for Advance prior to 11:00 a.m. (New
York time) on the date three (3) Business Days prior to the date of the
requested Advance. The Administrative Agent, whose determination shall be
conclusive, shall determine the available Eurodollar Basis and shall notify the
applicable Borrower of such Eurodollar Basis. A Borrower shall promptly notify
the Administrative Agent by telecopy or by telephone, and shall immediately
confirm any such telephonic notice in writing, of its selection of a Eurodollar
Basis and a Eurodollar Advance Period for such Advance. Upon receipt of such
notice, the Administrative Agent shall promptly notify each Lender by telephone
or telecopy of the contents thereof.
(ii) REPAYMENTS, CONTINUATIONS AND CONVERSIONS. A
Borrower shall give the Administrative Agent irrevocable written notice in the
form of a
27
Notice of Conversion/Continuation, or notice by telephone or telecopy followed
immediately by a Notice of Conversion/Continuation, (A) not later than 11:00
a.m. (New York time) at least three (3) Business Days prior to each applicable
Payment Date, specifying whether all or a portion of any Eurodollar Advance
outstanding on such Payment Date is to be continued in whole or in part as a
Eurodollar Advance, in which case such notice shall also specify the Eurodollar
Advance Period which such Borrower shall have selected for such continued
Eurodollar Advance, (B) not later than 11:00 a.m. (New York time) on each
applicable Payment Date, specifying whether all or any portion of any Eurodollar
Advance outstanding on such Payment Date, is to be converted in whole or in part
to a Base Rate Advance, or (C) not later than 11:00 a.m. (New York time) on each
applicable Payment Date, specifying whether all or any portion of any Eurodollar
Advance outstanding on such Payment Date, is to be repaid and not continued or
converted. Upon such Payment Date, such Eurodollar Advance will, subject to the
provisions hereof, be so repaid, continued or converted, as applicable.
(iii) MISCELLANEOUS. Notwithstanding any term or provision
of this Agreement which may be construed to the contrary, each Eurodollar
Advance shall be in a principal amount of at least $1,000,000 and in integral
multiples of $500,000 in excess thereof, and at no time shall the aggregate
number of all Eurodollar Advances exceed twelve (12).
(d) TELEPHONE NOTICE. The failure by a Borrower to confirm any
notice by telephone or telecopy with a Request for Advance or a Notice of
Conversion/Continuation, as applicable, shall not invalidate any notice so
given. The Administrative Agent may rely upon telephonic instructions reasonably
believed given by any Authorized Signatory of a Borrower and shall have no
obligation to inquire into the propriety of any such instructions.
(e) NOTIFICATION OF LENDERS. Upon receipt of a Request for
Advance or a Notice of Conversion/Continuation under this Section 2.2 from a
Borrower, the Administrative Agent shall promptly notify each Lender by
telephone or telecopy of the contents thereof and the amount of such Lender's
portion of the applicable Advance. Each Lender shall, not later than 1:00 p.m.
(New York time) on the date specified in such notice, make available to the
Administrative Agent at the Administrative Agent's Office, or at such account as
the Administrative Agent shall designate, the amount of its portion of the
applicable Advance in immediately available funds.
(f) DISBURSEMENT. Prior to 3:00 p.m. (New York time) on the date
of an Advance hereunder, the Administrative Agent shall, subject to the
satisfaction of the conditions set forth in this Section 2.2 and in Article 4
hereof, disburse the amounts made available to the Administrative Agent by the
Lenders in immediately available funds by (i) transferring the amounts so made
available by wire transfer pursuant to the instructions of the Borrower
requesting such Advance, or (ii) in the absence of such instructions, crediting
the amounts so made available to the account of the Borrowers
28
maintained with the Administrative Agent or an affiliate of the Administrative
Agent. Unless the Administrative Agent shall have received notice from a Lender
prior to 2:00 p.m. (New York time) on the date of any Advance that such Lender
will not make available to the Administrative Agent such Lender's ratable
portion of such Advance, and so long as notice has been given as provided in
Section 2.2(e) hereof, the Administrative Agent may assume that such Lender has
made such portion available to the Administrative Agent on the date of such
Advance and the Administrative Agent may, in its sole discretion and in reliance
upon such assumption, make available to the Borrowers on such date a
corresponding amount. If and to the extent such Lender shall not have so made
such ratable portion available to the Administrative Agent, such Lender agrees
to repay to the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount is
made available to the Borrowers until the date such amount is repaid to the
Administrative Agent, at a rate equal to the daily average Federal Funds Rate
for such period. If such Lender shall repay to the Administrative Agent such
corresponding amount, such amount so repaid shall constitute such Lender's
portion of the applicable Advance for purposes of this Agreement. If such Lender
does not repay such corresponding amount immediately upon the Administrative
Agent's demand therefor, the Administrative Agent shall notify the Borrowers,
and the Borrowers shall immediately pay such corresponding amount to the
Administrative Agent, on a joint and several basis, together with all interest
accrued thereon at the interest rate that would have applied to such Advance had
such Lender funded its portion thereof. The failure of any Lender to fund its
portion of any Advance shall not relieve any other Lender of its obligation, if
any, hereunder to fund its respective portion of the Advance on the date of such
borrowing, but no Lender shall be responsible for any such failure of any other
Lender. In the event that, at any time when the Borrowers are not in Default and
have otherwise satisfied all of the conditions to funding set forth in this
Agreement, a Lender for any reason fails or refused to fund its portion of an
Advance, then, until such time as such Lender has funded its portion of such
Advance, or all other Lenders have received payment in full (whether by
repayment or prepayment) of the principal and interest due in respect to such
advance, such non-funding Lender shall (i) have no right to vote regarding any
issue on which voting is required or advisable under this Agreement or any other
Loan Document and the calculation of Majority Lenders with respect solely to
such votes shall be adjusted as if such non-funding Lender has no Revolving Loan
Commitment and no Loans outstanding, and (ii) be entitled to receive no payments
of principal, interest or fees from the Borrowers in respect of such Loans which
such Lender failed to make. Nothing in this subsection shall be deemed to
prejudice any rights that the Borrowers may have against any Lender as a result
of any failure by such Lender to fund its portion of any Advance.
Section 2.3 INTEREST.
(a) ON BASE RATE ADVANCES. Interest on each Base Rate Advance
shall be computed on the basis of a year of 365/366 days when the Base Rate is
determined by reference to the Prime Rate and on the basis of a year of 360 days
when
29
the Base Rate is determined by reference to the Federal Funds Rate, in each case
for the actual number of days elapsed and shall be payable in arrears on the
last Business Day of each calendar quarter during the term of this Agreement.
Interest on Base Rate Advances then outstanding shall also be due and payable on
the date of any repayment made under Sections 2.5, 2.6 or 2.7 hereof and on the
Maturity Date. Interest shall accrue and be payable on each Base Rate Advance at
the simple per annum interest rate equal to the sum of (i) the Base Rate and
(ii) the Base Rate Applicable Margin.
(b) ON EURODOLLAR ADVANCES. Interest on each Eurodollar Advance
shall be computed on the basis of a 360-day year for the actual number of days
elapsed and shall be payable in arrears (i) on the applicable Payment Date for
such Eurodollar Advance, and (ii) if the Eurodollar Advance Period for such
Eurodollar Advance exceeds three (3) months, on each three (3) month anniversary
of the making of such Eurodollar Advance. Interest on Eurodollar Advances then
outstanding shall also be due and payable on the date of any repayment made
under Sections 2.5, 2.6 or 2.7 hereof and on the Maturity Date. Interest shall
accrue and be payable on each Eurodollar Advance at the simple per annum
interest rate equal to the sum of (A) the Eurodollar Basis applicable to such
Eurodollar Advance and (B) the Eurodollar Applicable Margin.
(c) INTEREST IF NO NOTICE OF SELECTION OF INTEREST RATE. If a
Borrower fails to give the Administrative Agent timely notice of its selection
of a Eurodollar Basis, or if for any reason a determination of a Eurodollar
Basis for any Eurodollar Advance is not timely concluded, the Base Rate shall
apply to such Advance and if a Borrower fails to elect to repay, continue or
convert any Eurodollar Advance then outstanding prior to the last Payment Date
applicable thereto in accordance with the provisions of Section 2.2 hereof, as
applicable, the Base Rate shall apply to such Advance commencing on and after
such Payment Date.
(d) INTEREST UPON DEFAULT. Upon the occurrence and during the
continuance of an Event of Default, the Majority Lenders shall have the option
(but shall not be required to give prior notice thereof to the Borrowers,
accelerate the maturity of the Loans or exercise any other rights or remedies
hereunder in connection with the exercise of this right) to charge interest on
the outstanding principal balance of the Loans at the Default Rate from the date
of such Event of Default. Such interest shall be payable on the earlier of
demand or the Maturity Date and shall accrue until the earlier of (i) waiver or
cure (to the satisfaction of the Majority Lenders) of the applicable Event of
Default, (ii) agreement by the Majority Lenders to rescind the charging of
interest at the Default Rate, or (iii) payment in full of the Obligations.
(e) COMPUTATION OF INTEREST. In computing interest on any
Advance, the date of making the Advance shall be included and the date of
payment shall be excluded; PROVIDED, HOWEVER, that if an Advance is repaid on
the date that it is made, one (1) day's interest shall be due with respect to
such Advance.
30
Section 2.4 FEES.
(a) FEES PAYABLE UNDER THE FEE LETTERS. The Borrowers, jointly
and severally, agree to pay such fees as are described in the Fee Letters.
(b) COMMITMENT FEE. The Borrowers, jointly and severally, agree
to pay to the Administrative Agent on behalf of the Lenders, in accordance with
their respective Commitment Percentages, a commitment fee on the Available
Revolving Loan Commitment for each day from (and including) the Agreement Date
to the Maturity Date, at a rate of (i) in the event that the Unused Percentage
shall be greater than or equal to fifty percent (50%), five-eighths of one
percent (0.625%) per annum and (ii) in the event that the Unused Percentage
shall be less than fifty percent (50%), three-eighths of one percent (0.375%)
per annum. Such commitment fees shall be computed on the basis of a year of
365/366 days for the actual number of days elapsed, shall be payable quarterly
in arrears on the last Business Day of each quarter, commencing with respect to
the quarter ending March 31, 2002 (for the period from the Agreement Date to
such Business Day), and continuing on the last Business Day of each successive
quarter, and shall be fully earned when due and nonrefundable when paid.
Section 2.5 OPTIONAL PREPAYMENTS AND REDUCTIONS.
(a) PREPAYMENT OF ADVANCES UNDER THE REVOLVING LOAN COMMITMENT.
The principal amount of any Base Rate Advance under the Revolving Loan
Commitment may be prepaid in full or in part at any time, without penalty, upon
prior written notice prior to 11:00 a.m. (New York time) to the Administrative
Agent on the date of such prepayment, and the principal amount of any Eurodollar
Advance under the Revolving Loan Commitment may be prepaid prior to the
applicable Payment Date, upon telephonic notice to the Administrative Agent
(promptly confirmed in writing) prior to 11:00 a.m. (New York time) on the date
three (3) Business Days prior thereto, provided that the Borrowers shall,
jointly and severally, reimburse the Lenders and the other Credit Parties, on
the earlier of demand or the Maturity Date, for any loss or out-of-pocket
expense incurred by the Lenders or the other Credit Parties in connection with
such prepayment as set forth in Section 2.11 hereof. Each notice of prepayment
shall be irrevocable. Partial prepayments shall be in a principal amount of not
less than $500,000 or an integral multiple of $100,000 in excess thereof. Upon
receipt of any notice of prepayment, the Administrative Agent shall promptly
notify each Lender of the contents thereof by telephone or telecopy and of such
Lender's portion of the prepayment.
(b) PERMANENT REDUCTIONS. Optional permanent reductions of the
Revolving Loan Commitment hereunder may be made by the Borrowers, at any time
and from time to time, following irrevocable written notice to the
Administrative Agent prior to 11:00 a.m. (New York time) on the date three (3)
Business Days prior thereto, without premium or penalty, on a pro rata basis
among the Lenders, provided that the Borrowers shall, jointly and severally,
reimburse the Lenders and the other Credit Parties, on the earlier of demand or
the Maturity Date, for any loss or out-of-pocket expense
31
incurred by the Lenders or the other Credit Parties in connection with such
reduction as set forth in Section 2.11 hereof. Each notice of reduction shall be
irrevocable. Partial reductions shall be in a principal amount of not less than
$500,000 or an integral multiple of $100,000 in excess thereof. Upon receipt of
any notice of reduction, the Administrative Agent shall promptly notify each
Lender of the contents thereof by telephone or telecopy and of such Lender's
portion of the reduction.
(c) APPLICATION OF REDUCTIONS. As of the date of cancellation or
reduction of the Revolving Loan Commitment pursuant to Section 2.5(b) hereof set
forth in any notice thereof, (i) the Revolving Loan Commitment shall be
permanently reduced to the amount stated in the Borrowers' notice for all
purposes herein, (ii) the amount of such reduction shall be applied to reduce
the remaining scheduled reductions of the Revolving Loan Commitment as set forth
in Section 2.7 hereof in the inverse order of reduction, and (iii) the Borrowers
shall, subject to Section 2.11 hereof, jointly and severally, pay to the
Administrative Agent, for the account of the applicable Lenders, the amount
necessary to reduce the principal amount of the Revolving Loans and the Swing
Loans then outstanding to not more than the amount of the Revolving Loan
Commitment as so reduced, together with accrued interest on the amount so
prepaid and the commitment fee set forth in Section 2.4(b) hereof accrued
through the date of the reduction with respect to the amount reduced.
Section 2.6 MANDATORY PREPAYMENTS. In addition to the repayments
provided for in Section 2.7 hereof, if at any time the aggregate principal
amount of Revolving Loans and Swing Loans outstanding shall exceed the Revolving
Loan Commitment for any reason whatsoever, the Borrowers shall, jointly and
severally, immediately make a payment of the Revolving Loans in the amount of
such excess, together with accrued interest on the amount so prepaid.
Section 2.7 REPAYMENT. The Revolving Loan Commitment shall be reduced
automatically and permanently on the last Business Day of each quarter and on
the Maturity Date (which reduction shall be inclusive of any reduction pursuant
to Section 2.5 hereof during such quarter) as set forth below:
32
AMOUNT OF QUARTERLY
REDUCTION(WHICH SHALL
INCLUDE ANY REDUCTIONS
MADE DURING SUCH QUARTER TOTAL ANNUAL
QUARTERS ENDED PURSUANT TO SECTION 2.5) REDUCTION PERCENTAGE
-------------- ------------------------ --------------------
September 30, 2004 and $ 5,000,000 5.00%
December 31, 2004
March 31, 2005 through $ 20,000,000 40.00%
December 31, 2005
March 31, 2006 through $ 27,500,000 55.00%
December 31, 2006
As of the date of each reduction of the Revolving Loan Commitment as set forth
above, the Borrowers shall, jointly and severally, pay to the Administrative
Agent, for the benefit of the Lenders, the amount necessary to reduce the
principal amount of the Revolving Loans, plus Swing Loans, then outstanding to
not more than the amount of the Revolving Loan Commitment as so reduced,
together with accrued interest on the amount so prepaid and the commitment fee
set forth in Section 2.4(b) hereof accrued through the date of the reduction
with respect to the amount reduced. Any unpaid principal and accrued interest of
the Revolving Loans and the Swing Loans and any other outstanding Obligations
shall be due and payable in full on the Maturity Date.
Section 2.8 SWING LOANS.
(a) SWING LOAN ADVANCES.
(i) NOTICES; DISBURSEMENT. Whenever the Borrowers
desire an Advance of the Swing Loans hereunder a Borrower shall give irrevocable
notice to the Swing Loan Lender not later than 1:00 p.m. (New York time) on the
date of the requested Advance by telephone, followed immediately by a
confirmation of such request in writing in the form of EXHIBIT M hereto (a
"SWING LOAN REQUEST"). The Swing Loan Lender shall initiate the transfer of
funds representing the Swing Loan advance to the Borrowers by 3:00 p.m. (New
York time) on the Business Day specified in the applicable Swing Loan Request.
(ii) MINIMUM AMOUNTS. Each Advance of the Swing Loans
shall be in a minimum principal amount of $500,000 and integral multiples of
$250,000, in excess thereof.
(b) REPAYMENT OF SWING LOANS. Each Advance of the Swing Loans
shall be due and payable on the earliest of (i) seven (7) days from the date of
such Advance, (ii) the date of the next Advance of the Revolving Loans, or (iii)
the Maturity Date; PROVIDED, HOWEVER, the Borrowers may prepay any Swing Loan
Advance prior to the date it is due upon notice to the Swing Loan Lender not
later than 1:00 p.m. (New
33
York time) on the date of prepayment of such Advance. If such notice is given by
a Borrower, the Borrowers shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein,
together with accrued interest to such date on the amount prepaid. If, and to
the extent, any Swing Loans shall be outstanding on the date of any Advance of
the Revolving Loans, such Swing Loans shall be repaid from the proceeds of such
Advance of the Revolving Loans prior to any distribution of such proceeds to the
Borrowers. If, and to the extent, an Advance of the Revolving Loans is not
requested prior to earlier of (A) the Maturity Date or (B) the last day of any
such seven (7) day period from the date of any Advance of the Swing Loans, the
Borrowers shall be deemed to have requested a Base Rate Loan on the Business Day
immediately preceding the Maturity Date or the last day of such seven (7) day
period, as applicable, in the amount of the Swing Loans then outstanding, the
proceeds of which shall be used to repay the Swing Loan Lender for such Swing
Loans. In addition, the Swing Loan Lender may, at any time, in its sole
discretion by written notice to the Borrowers and the Administrative Agent,
require repayment of its Swing Loans by way of a Revolving Loan, in which case
the Borrowers shall be deemed to have requested a Base Rate Advance of the
Revolving Loans in the amount of such Swing Loans; PROVIDED, HOWEVER, that any
such demand shall be deemed to have been given one (1) Business Day prior to the
Maturity Date and upon the occurrence of any Event of Default described in
Section 9.1(j) or 9.1 (k) hereof and also upon acceleration of the Obligations,
whether on account of an Event of Default described in Section 9.1(j) or 9.1(k)
hereof or any other Event of Default, in accordance with the provisions of
Section 9.2 hereof following an Event of Default (each such Revolving Loan made
on account of any such deemed request therefor as provided herein being
hereinafter referred to as a "MANDATORY BORROWING"). Each Lender hereby
irrevocably agrees to make its Commitment Percentage of such Revolving Loans
promptly upon any such request or deemed request on account of each Mandatory
Borrowing in the amount and in the manner specified in the preceding sentence
and on the same such date, notwithstanding (I) the amount of Mandatory Borrowing
may not comply with the minimum amount for advances of Revolving Loans otherwise
required hereunder, (II) whether any conditions specified in Article 4 are then
satisfied, (III) whether a Default or an Event of Default then exists, (IV)
failure for any such request or deemed request for Revolving Loans to be made by
the time otherwise required in Section 2.2, (V) the date of such Mandatory
Borrowing, or (VI) any reduction in the Revolving Loan Commitment or termination
of the Revolving Loan Commitment relating thereto immediately prior to such
Mandatory Borrowing or contemporaneously therewith; PROVIDED, HOWEVER, that no
Lender shall be required to make such Revolving Loans if, at the time that the
Swing Loan Lender agreed to fund any Swing Loan Request, the Swing Loan Lender
had knowledge of the existence of an Event of Default or such Mandatory
Borrowing would cause a Lender to exceed its Revolving Loan Commitment. In the
event that any Mandatory Borrowing cannot for any reason be made on the date
otherwise required above (including, without limitation, as a result of the
commencement of any Insolvency Proceeding with respect to either of the
Borrowers or any other obligor hereunder), then each Lender hereby agrees that
it shall forthwith purchase (as of the date the Mandatory Borrowing would
otherwise have
34
occurred, but adjusted for any payments received from the Borrowers on or after
such date and prior to such purchase) from the Swing Loan Lender such
participations in the outstanding Swing Loans as shall be necessary to cause
each such Lender to share in such Swing Loans ratably based upon its respective
Commitment Percentage (determined before giving effect to any termination of the
Commitments pursuant to Section 9.2), provided that (A) all interest payable on
the Swing Loans shall be for the account of the Swing Loan Lender until the date
as of which the respective participation is purchased, and (B) at the time any
purchase of participations pursuant to this sentence is actually made, the
purchasing Lender shall be required to pay (to the extent not paid by the
Borrowers) to the Swing Loan Lender interest on the principal amount of
participation purchased for each day from and including the day upon which the
Mandatory Borrowing would otherwise have occurred but excluding the date of
payment for such participation, at the rate equal to, if paid within two (2)
Business Days of the date of the Mandatory Borrowing, the Federal Funds Rate,
and thereafter at a rate equal to the Base Rate.
(c) INTEREST ON SWING LOANS. Swing Loans shall bear interest at
the simple per annum interest rate equal to the sum of (x) the Base Rate and (y)
the Base Rate Applicable Margin, computed on the basis of a year of 365/366 days
when the Base Rate is determined by reference to the Prime Rate and on the basis
of a year of 360 days when the Base Rate is determined by reference to the
Federal Funds Rate, in each case for the actual number of days elapsed;
PROVIDED, HOWEVER, that (i) from and after any failure to make any payment of
principal or interest in respect of any of the Loans hereunder when due (after
giving effect to any applicable grace period), whether at scheduled or
accelerated maturity or on account of any mandatory prepayment or (ii) while any
Swing Loans in which the Lenders have acquired participations pursuant to
Section 2.8(b) hereof remain outstanding, the principal of and, to the extent
permitted by law, interest on, Swing Loans shall bear interest, payable on
demand, at the Default Rate. Interest on each Swing Loan shall be payable in
arrears on the date payment of such Swing Loan is due pursuant to Section 2.8(b)
hereof.
(d) REPORTING. Unless the Swing Loan Lender is the
Administrative Agent, the Swing Loan Lender shall provide to the Administrative
Agent, on Friday of each week and on each date the Administrative Agent notifies
the Swing Loan Lender that the Borrowers have made a Request for Advance or the
Administrative Agent otherwise requests the same, an accounting for the
outstanding Swing Loans in form reasonably satisfactory to the Administrative
Agent.
(e) TERMINATION OF SWING LOANS; DESIGNATION OF SWING LOAN
LENDER. Unless a Default or an Event of Default then exists, the Swing Loan
Lender shall give the Borrower and the Administrative Agent at least seven (7)
days prior written notice before exercising its discretion herein not to make
Swing Loans. The Borrower must give ten (10) days prior written notice to the
Administrative Agent of any change in designation of the Swing Loan Lender. The
replaced Swing Loan Lender shall continue
35
to be a "Swing Loan Lender" for purposes of repayment of any Swing Loans made
prior to such replacement and outstanding after such replacement.
Section 2.9 NOTES; LOAN ACCOUNTS.
(a) The Loans shall be repayable in accordance with the
terms and provisions set forth herein, and shall be evidenced by the Notes. One
Revolving Note shall be payable to the order of each Lender in accordance with
such Lender's Commitment Percentage. The Swing Loan Note shall be payable to the
order of the Swing Loan Lender in the amount of the Swing Loan Committed Amount.
The Revolving Notes shall be issued by the Borrowers, on a joint and several
basis, to each of the Lenders, and the Swing Loan Note shall be issued by the
Borrowers, on a joint and several basis, to the Swing Loan Lender. Each of the
Notes shall be duly executed and delivered by Authorized Signatories of each of
the Borrowers.
(b) Each Lender may open and maintain on its books in the
name of the Borrowers a loan account with respect to the Loans and interest
thereon. Each Lender which opens such loan account or accounts shall debit the
applicable loan account for the principal amount of each Advance made by it and
accrued interest thereon, and shall credit such loan account for each payment on
account of principal of or interest on the Loans. The records of each Lender
with respect to the loan accounts maintained by it shall be prima facie evidence
of the Loans and accrued interest thereon, but the failure to maintain such
records shall not impair the joint and several obligation of the Borrowers to
repay Indebtedness hereunder.
(c) Each Advance from the Lenders (other than the Swing
Loan Lender) under this Agreement shall be made pro rata by the Lenders on the
basis of their respective Commitment Percentages.
Section 2.10 MANNER OF PAYMENT.
(a) Each payment (including any prepayment) by the
Borrowers on account of the principal of or interest on the Loans, commitment
fees, and any other amount owed to the Lenders and the Administrative Agent
under this Agreement, the Notes or the other Loan Documents shall be made not
later than 2:00 p.m. (New York time) on the date specified for payment under
this Agreement or such other Loan Document to the Administrative Agent to an
account designated by the Administrative Agent for the account of the Lenders or
the Administrative Agent, as the case may be, in lawful money of the United
States of America in immediately available funds. Any payment received by the
Administrative Agent after 2:00 p.m. (New York time) shall be deemed received on
the next Business Day for purposes of interest accrual. In the case of a payment
for the account of a Lender, the Administrative Agent will promptly thereafter
distribute the amount so received in like funds to such Lender. If the
Administrative Agent shall not have received any payment from the Borrowers as
and when due, the Administrative Agent will promptly notify the Lenders
accordingly.
36
(b) If any payment under this Agreement or any of the Notes
shall be specified to be made upon a day which is not a Business Day, it shall
be made on the next succeeding day which is a Business Day, and such extension
of time shall in such case be included in computing interest and fees, if any,
in connection with such payment.
(c) Except as otherwise provided below, any and all
payments by the Borrowers to the Administrative Agent or any other Credit Party
under this Agreement or the Notes shall be made without set-off or counterclaim
or deduction whatsoever.
(i) Unless otherwise required by Applicable Law, any
and all payments by the Borrowers to the Administrative Agent and the other
Credit Parties, or any of them, under this Agreement or the Notes shall be made
without any deduction or withholding for present or future income, excise, stamp
or franchise taxes and other taxes, fees, duties, withholdings or other charges
of any nature whatsoever imposed by any taxing authority, excluding, however,
franchise, withholding, branch or other similar Taxes, duties, fees or charges
imposed on or measured by any Credit Party's net income or receipts (such
non-excluded items being called "TAXES").
(ii) If either of the Borrowers shall be required by
Applicable Law to deduct any Taxes from or in respect of any amounts payable
hereunder or under any Note to the Administrative Agent or any other Credit
Party, (A) except as otherwise provided in this Section, the sum payable shall
be increased ("ADDITIONAL AMOUNTS") as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.10(c)), the Administrative Agent or such other Credit
Party, as the case may be, receives an amount equal to the sum it would have
received had no deductions been made, (B) the applicable Borrower shall make
such deductions, and (C) the applicable Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with Applicable Law. Moreover, if any Taxes (which for purposes of this sentence
shall include taxes and charges imposed on or measured by net income or receipts
of any Credit Party by any jurisdiction to the extent imposed on Additional
Amounts) are directly asserted against any Credit Party with respect to any
payment received by such Credit Party hereunder, such Credit Party may pay such
Taxes, and, except as otherwise provided in this Section, the Borrowers, jointly
and severally, will promptly pay such additional amount (including any
penalties, interest or expenses) as is necessary in order that the net amount
received and retained by such Credit Party after the payment of such Taxes
(including any Taxes on such additional amount) shall equal the amount such
Credit Party would have received and retained had no such Taxes been asserted;
PROVIDED, HOWEVER, such Credit Party shall give written notice to the Borrowers,
accompanied by, to the extent provided by the relevant taxing authority, a
calculation in reasonable detail of the amount demanded and evidence of the
Taxes imposed on such Credit Party, after such Credit Party has actual knowledge
of the imposition of any Taxes.
37
Where notice is not given to the Borrowers within forty-five (45) days after the
Credit Party receives written notice of the assertion of Taxes and the Borrowers
do not otherwise have notice of such assertion, the Borrowers shall not be
required to pay penalties, additions to taxes, expenses, and interest accruing
on such Taxes from the date forty-five (45) days after the receipt by the Credit
Party of written notice of the assertion of such Taxes until the date that the
Borrowers receive such notice. The Borrowers shall furnish to such Credit Party
within forty-five (45) days (or as soon thereafter as available) after the date
the payment of any Taxes is due pursuant to Applicable Law true and correct
copies of tax receipts evidencing payment by either of the Borrowers. Except as
otherwise provided in this Section , if either of the Borrowers fails to pay any
Taxes that it is required to pay pursuant to the terms of this Agreement when
due to the appropriate taxing authority or fail to remit to any of the Credit
Parties the required receipts or other required documentary evidence, the
Borrowers shall, jointly and severally, indemnify the Credit Parties for any
incremental Taxes, interest or penalties that may become payable by the Credit
Parties primarily as a result of any such failure.
(iii) Each Lender that is not a United States person
within the meaning of Section 7701 of the Code (a "FOREIGN LENDER") shall
deliver to the Borrowers and the Administrative Agent, no later than the date
hereof (or if such Foreign Lender becomes a party to this Agreement (whether by
assignment or otherwise) after the date hereof, the date upon which such Foreign
Lender becomes a party hereto), (A) two (2) complete, duly executed original IRS
Forms W-8ECI or IRS Forms W-8BEN, or any successors thereto, establishing that
such Foreign Lender is on the date of delivery thereof entitled to receive any
and all payments from the Borrowers under this Agreement free from withholding
of United States federal income tax or (B) in the case of such Foreign Lender
that is not legally entitled to deliver either form listed in clause
(b)(iii)(A), (I) a certificate of a duly authorized officer of such Foreign
Lender to the effect that such Foreign Lender is not (x) a "bank" within the
meaning of Section 881(c)(3)(A) of the Code, (y) a "10 percent shareholder" of a
Borrower within the meaning of Section 881(c)(3)(B) of the Code or (z) a
controlled foreign corporation receiving interest from a related person within
the meaning of Section 881(c)(3)(C) of the Code (such certificate, an "EXEMPTION
CERTIFICATE") and (II) two (2) duly completed copies of Internal Revenue Service
Form W-8BEN or successor applicable form, certifying that such Foreign Lender is
entitled to an exemption from United States federal withholding tax on payments
of interest. Each Foreign Lender shall, from time to time, deliver updated or
corrected IRS Forms W-8ECI, IRS Forms W-8BEN or Exemption Certificates, or any
successors thereto, to the Borrowers and the Administrative Agent to the extent
and in the manner required under United States federal tax law. The Borrowers
shall not be required to pay any Additional Amounts under Section 2.10(c)(ii)
hereof to a Foreign Lender if such Foreign Lender (I) fails to comply with the
requirements of this Section 2.10(c)(iii) hereof or, (II) fails to qualify for a
complete reduction or exemption of United States federal tax withholding for any
reason other than a change in the United States federal tax law, or the official
interpretation thereof, in each case, after the delivery of IRS Forms W-8ECI,
IRS Forms W-8BEN or an Exemption
38
Certificate, or any successors thereto, or (III) is treated as a "conduit
entity" within the meaning of U.S. Treasury Regulations Section 1.881-3 or any
successor provision. Notwithstanding the foregoing, if at the date of an
assignment pursuant to which a Foreign Lender becomes a party to this Agreement,
the assignor was entitled to payments under Section 2.10(c)(ii) hereof, then, to
such extent, the assignee, shall not be required to deliver IRS Forms W-8ECI,
IRS Forms W-8BEN or an Exemption Certificate, or any successors thereto,
establishing a withholding rate for such Foreign Lender that is less than the
rate the assignor was subject to, and the assignee shall be entitled to receive
Additional Amounts to such extent the assignor was so entitled.
(iv) Each of the Credit Parties agrees that it will,
to the extent reasonable and without material cost or risk to it, (A) take all
actions reasonably requested by the Borrowers to maintain all exemptions, if
any, available to it from United States federal withholding taxes (whether
available by treaty, statute, or existing administrative waiver) and (B)
otherwise cooperate with the Borrowers to minimize any amounts payable by the
Borrowers under this Section 2.10(c), including the contest of any asserted tax
liability.
(v) Any Credit Party that becomes aware that it is
entitled to receive a refund (whether by way of a direct payment or by offset)
in respect of Additional Amounts paid by the Borrowers, which refund, would
reasonably be considered allocable to or resulting from such payment or
indemnification made pursuant to this Section 2.10, shall promptly notify the
Borrowers of the availability of such refund and shall, within thirty (30) days
after the receipt of a request from the Borrowers, apply for such refund with
the Borrowers being responsible for any incremental costs associated with such
refund request; PROVIDED, HOWEVER, that (A) neither of the Borrowers shall be
entitled to any damages as a result of the failure of such Credit Party to so
notify the Borrowers of the availability of such refund and (B) neither of the
Borrowers shall have the right to examine the books or records of any Credit
Party. If any Credit Party receives any such refund (as described in the
preceding sentence), it shall promptly repay the amount of such refund (together
with any interest received thereon) to the Borrowers; PROVIDED, HOWEVER, that
the Borrowers, upon the request of the applicable Credit Party, shall, jointly
and severally, repay the amount paid over to the Borrowers in the event such
Credit Party is required to repay such refund to the applicable authority.
(vi) If the Borrowers are or become required to pay any
Additional Amounts to a Credit Party pursuant to this Section 2.10, the
Borrowers shall have the right, upon notice to the Administrative Agent and such
Credit Party to (A) prepay without penalty, on non-pro rata basis, all or any
portion of a Loan held by such Credit Party plus all interest and Additional
Amounts owing to such Credit Party as of the date of such prepayment, (B)
require such Credit Party to use reasonable efforts to designate a different
lending office for funding or booking its Loan under this Agreement or to assign
its rights and obligations under this Agreement to another of its offices,
branches or affiliates, or (C) require such Credit Party to effect an assignment
all of its
39
rights and obligations under this Agreement to another Credit Party
designated by the Borrowers if, in the case of clause (B) or (C) such
designation or assignment (x) would eliminate or reduce amounts payable pursuant
to this Section 2.10 in the future and (y) would not cause the imposition on
such Credit Party of any additional costs or legal or regulatory burdens deemed
by such Credit Party to be material or otherwise disadvantageous to such Credit
Party.
Section 2.11 REIMBURSEMENT. Whenever any Lender shall actually incur
any losses or out-of-pocket expenses in connection with (a) the failure by a
Borrower to convert, continue or borrow any Eurodollar Advance after having
given notice of its intention to convert, continue or borrow such Eurodollar
Advance in accordance with Section 2.2 hereof (whether by reason of the election
of a Borrower not to proceed or the non-fulfillment of any of the conditions set
forth in Article 4 hereof) other than a failure to borrow resulting from an
unavailability which occurs after notice from the Administrative Agent to the
Borrowers pursuant to Section 11.1 or 11.2 hereof, (b) the prepayment of any
Eurodollar Advance in whole or in part (including a prepayment pursuant to
Sections 11.2 and 11.3(b) hereof), or (c) the failure by the Borrowers to prepay
any Advance after notice of prepayment has been given by a Borrower to the
Administrative Agent in accordance with Section 2.5 hereof, the Borrowers,
jointly and severally, agree to pay to such Lender, upon the earlier of such
Lender's demand or the Maturity Date, an amount sufficient to compensate such
Lender for all such losses and out-of-pocket expenses. Such Lender's good faith
determination of the amount of such losses and out-of-pocket expenses, absent
manifest error, shall be binding and conclusive. Upon request of the Borrowers,
any Lender seeking reimbursement under this Section 2.11 shall provide a
certificate setting forth the amount to be paid to it by the Borrowers hereunder
and calculations therefor.
Section 2.12 APPLICATION OF PAYMENTS.
(a) Other than with respect to payments required to be made
pursuant to Section 2.5 hereof (which shall be applied, as applicable, as set
forth in Section 2.5), payments made to any Credit Party, or otherwise received
by any Credit Party (from realization on Collateral or otherwise), shall be
distributed as follows: FIRST, to the costs and expenses, if any, incurred by
the Credit Parties, or any of them, to the extent permitted by Section 12.2
hereof, in the collection of such amounts under this Agreement or any of the
other Loan Documents, including, without limitation, any reasonable costs
incurred in connection with the sale or disposition of any collateral for the
Obligations; SECOND, pro rata among the Credit Parties based on the total amount
of fees then due and payable, to any fees then due and payable hereunder or
under any other Loan Document and to any other fees then due and payable to the
Lenders under this Agreement or any other Loan Document; THIRD, to the Swing
Loan Lender, to any unpaid interest which may have accrued on the Swing Loans;
FOURTH, pro rata among the Lenders based on the principal amount of the
Revolving Loans outstanding immediately prior to such payment, to any unpaid
interest which may have accrued on
40
the Revolving Loans; FIFTH, to the Swing Loan Lender, to any unpaid principal of
the Swing Loans; SIXTH, pro rata among the Lenders based on the principal amount
of the Revolving Loans outstanding immediately prior to such payment, to any
unpaid principal of the Revolving Loans (with such payment to permanently reduce
the Revolving Loan Commitment in inverse order of scheduled reduction); SEVENTH,
to any other Obligations not otherwise referred to in this Section 2.12(a) until
all such Obligations are paid in full; EIGHTH, pro rata among the Credit Parties
based on the amount of damages outstanding immediately prior to such payment, to
damages incurred by the Credit Parties, or any of them, by reason of any breach
hereof or of any other Loan Documents; and NINTH, to the Borrowers or as
otherwise required by law.
(b) If any Lender shall obtain any payment on any date
(whether involuntary or otherwise) on account of the Loans (excluding any Swing
Loans) made by it in excess of its ratable share of the payments made by the
Borrower to the Credit Parties on such date (in the aggregate), such that, after
giving effect thereto, such Lender's outstanding Loans (excluding any Swing
Loans) are less than such Lender's ratable share of all the Loans then
outstanding (in the aggregate) in accordance with such Lender's Commitment
Percentage, such Lender shall forthwith purchase from the other Lenders such
participations in the Loans made by such other Lenders as shall be necessary to
cause such purchasing Lender to share the excess payment ratably with each of
them; PROVIDED, HOWEVER, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and such Lender shall repay to each purchasing Lender the
purchase price to the extent of such recovery. The Borrowers agree that any
Lender so purchasing a participation from another Lender pursuant to this
Section 2.12(b) may, to the fullest extent permitted by law, exercise all its
rights of payment with respect to such participation as fully as if such Lender
were the direct creditor of the Borrowers in the amount of such participation so
long as the Obligations are not increased as a result of such participation. If
the Swing Loan Lender shall receive any payment on any date on account of its
Swing Loans in excess the amount to which it is entitled in accordance with
Section 2.8(a), the Swing Loan Lender shall remit the amount of such excess to
the other Lenders as the Administrative Agent may direct in accordance with
Section 2.8(a).
Section 2.13 CAPITAL ADEQUACY. In the event that any Lender shall
have determined that a Regulatory Change has the effect of reducing the rate of
return on such Lender's capital as a consequence of its obligations hereunder to
a level below that which such Lender could have achieved but for such adoption,
change or compliance (taking into consideration such Lender's policies with
respect to capital adequacy) by an amount deemed by such Lender to be material,
then from time to time, ten (10) days after submission by such Lender to the
Borrowers (with a copy to the Administrative Agent) of a written request
therefor, together with a certificate (which shall be conclusive absent manifest
error), setting forth the calculations evidencing such requested additional
amount, and the law or regulation with respect thereto and certifying that such
request is consistent with such Lender's treatment of other similar customers
having similar
41
provisions generally in their agreements with such Lender and that such request
is being made on the basis of a reasonable allocation of the costs resulting
from such law or regulation, the Borrowers shall, jointly and severally, pay to
such Lender such additional amount or amounts as will compensate such Lender for
such reduction. Allocations shall not be deemed reasonable unless made ratably,
to the extent practicable, to all affected assets, commitments, activities or
other relevant aspects of such Lender's business, whether or not the Lender is
entitled to compensation with respect thereto. Notwithstanding the foregoing,
the Borrowers shall only be obligated to compensate such Lender for any amount
under this subsection arising or occurring during (a) in the case of each such
request for compensation, any time or period commencing not more than ninety
(90) days prior to the date on which such Lender submits such request and (b)
any other time or period during which, because of the unannounced retroactive
application of such law, regulation, interpretation, request or directive, such
Lender reasonably could not have known that the resulting reduction in return
might arise. Each Lender will notify the Borrowers that it is entitled to
compensation pursuant to this subsection as promptly as practicable after it
determines to request such compensation; PROVIDED, HOWEVER, that the failure to
provide such notice shall not restrict the ability of such Lender to be
reimbursed under this Section 2.13.
Section 2.14 INCREMENTAL FACILITY LOANS.
(a) Subject to the terms and conditions of this Agreement,
the Borrowers may request Incremental Facility Commitments on any Business Day;
PROVIDED, HOWEVER, that the Borrowers may not request Incremental Facility
Commitments or an Incremental Facility Loan during the continuance of a Default
or Event of Default, including, without limitation, any Default or Event of
Default that would result after giving effect to any Incremental Facility Loan;
and PROVIDED FURTHER, that the Borrowers may request an Incremental Facility
Commitment (which commitment may be from more than one Lender) which may be no
more than $35,000,000 in the aggregate. The final maturity date for all
Incremental Facility Loans shall be no earlier than the Maturity Date. In
requesting Incremental Facility Commitments, the Borrowers shall offer each of
the Lenders an opportunity to provide an Incremental Facility Commitment;
PROVIDED that none of the Lenders shall be required to issue an Incremental
Facility Commitment and the decision of any Lender to issue or not issue an
Incremental Facility Commitment to the Borrowers shall be at such Lender's sole
discretion after being offered such right of first refusal (and the failure to
respond to any such offer by the requested deadline shall be deemed a refusal).
Persons not then Lenders may be included as Lenders having Incremental Facility
Commitments with the written approval of the Borrowers and the Administrative
Agent. The Incremental Facility Commitments (i) may be in the form of a
revolving or a term credit facility and may be structured as an institutional
tranche, (ii) must not (A) have scheduled amortization providing for principal
repayments or commitment reductions earlier than, or in an amount on a
percentage basis larger than, those dates or amounts set forth in the reduction
schedule for the Revolving Loan Commitment set forth herein, or (B) be secured
by more or
42
different collateral than the Loans hereunder, and (iii) must be governed by
this Agreement and the other Loan Documents and be subject to terms and
conditions not more restrictive than those set forth herein and therein for the
Loans.
(b) Prior to the effectiveness of any Incremental Facility
Commitment, the Borrowers shall (i) deliver to the Administrative Agent and the
Lenders a notice, in form and substance satisfactory to the Administrative
Agent, setting forth terms and provisions with respect to interest rates and
scheduled amortization with respect to the proposed Incremental Facility Loan
and (ii) provide revised projections to the Administrative Agent and the
Lenders, which shall be in form and substance reasonably satisfactory to the
Administrative Agent and which shall demonstrate the Borrowers' ability to
timely repay such Incremental Facility Commitment and any Incremental Facility
Loans thereunder and to comply with the terms and conditions of this Agreement
and the other Loan Documents.
(c) No Incremental Facility Commitment shall by itself
result in any reduction of the Revolving Loan Commitment or of the Commitment
Percentage with respect to the Revolving Loans of such Lender issuing such
Incremental Facility Commitment.
(d) Incremental Facility Loans (i) shall bear interest at
the Base Rate or the Eurodollar Rate or such other reasonable rate agreed to by
the Lenders making such Incremental Facility Loans; (ii) subject to Section
2.14(a) hereof, shall be repaid on a joint and several basis as agreed to by the
Borrowers and the Lenders making such Incremental Facility Loans; (iii) shall
for all purposes be Obligations hereunder and under the Loan Documents; (iv)
shall be represented by promissory notes which set forth terms and provisions
with respect to interest rates and scheduled amortization with respect to such
Incremental Facility Loans and are in form and substance acceptable to the
Administrative Agent and the Borrowers (each, an "INCREMENTAL FACILITY NOTE"),
and (v) shall rank pari passu with the Loans for purposes of Sections 2.12 and
9.2 hereof (unless the applicable Incremental Facility Lender shall otherwise
agree in writing to have its Incremental Facility Loans be junior to the Loans).
(e) Incremental Facility Loans shall be requested by the
Borrowers pursuant to a request (which shall be substantially in the form of a
Request for Advance) delivered in the same manner as a Request for Advance, but
shall be funded pro rata only by those Lenders that hold the Incremental
Facility Commitments.
Section 2.15 ALL OBLIGATIONS TO CONSTITUTE JOINT AND SEVERAL
OBLIGATIONS.
(a) All Obligations shall constitute joint and several
obligations of the Borrowers and shall be secured by the Administrative Agent's
security interest (on behalf of the Credit Parties) and Lien upon all of the
Collateral, and by all other security interests and Liens heretofore, now or at
any time hereafter granted by either of the Borrowers to the Administrative
Agent and the other Credit Parties, to the
43
extent provided in the Security Documents under which such Lien arises. Each
Borrower expressly represents and acknowledges that (i) with respect to this
Agreement, it is part of a common enterprise with the other Borrower and (ii)
any financial accommodations by the Credit Parties to either Borrower hereunder
and under the other Loan Documents are and will be of direct and indirect
interest, benefit and advantage to both Borrowers. Each Borrower acknowledges
that any Request for Advance, Notice of Conversion/Continuation or other notice
given by either of the Borrowers to the Administrative Agent or any other Credit
Party shall bind both Borrowers, and that any notice given by the Administrative
Agent or any other Credit Party to either Borrower shall be effective with
respect to both Borrowers. Each Borrower acknowledges its liability without
regard to which Borrower actually may have directly received the proceeds of any
of the Loans or other extensions of credit hereunder or the manner in which the
Administrative Agent or any of the other Credit Parties accounts for such Loans
or other extensions of credit on its books and records, and further acknowledges
that the Credit Parties are relying on the joint and several liability of the
Borrowers in extending the Loans and other financial accommodations hereunder.
(b) Each Borrower represents that, except as provided in
Section 2.16 hereof, it has not waived or modified any subrogation and
contribution rights to which it may be entitled from and against the other
Borrower to the extent it is required to pay to the Credit Parties any amount in
excess of the Loans advanced hereunder directly to it.
Section 2.16 MAXIMUM BORROWER LIABILITY.
(a) It is the intent of the Borrowers and the Credit
Parties and any other Person holding any of the Obligations that each Borrower's
maximum obligations hereunder (such Borrower's "MAXIMUM BORROWER LIABILITY") in
any case or proceeding referred to below (but only in such a case or proceeding)
shall not be in excess of:
(i) in a case or proceeding commenced by or against
such Borrower under the Bankruptcy Code on or within one (1) year from the date
on which any of the Obligations of such Borrower are incurred, the maximum
amount that would not otherwise cause the obligations of such Borrower hereunder
(or any other obligations of such Borrower to the Credit Parties and any other
Person holding any of the Obligations) to be avoidable or unenforceable against
such Borrower under (A) Section 548 of the Bankruptcy Code or (B) any state
fraudulent transfer or fraudulent conveyance act or statute applied in such case
or proceeding by virtue of Section 544 of the Bankruptcy Code; or
(ii) in a case or proceeding commenced by or against
such Borrower under the Bankruptcy Code subsequent to one (1) year from the date
on which any of the Obligations of such Borrower are incurred, the maximum
amount that would not otherwise cause the obligations of such Borrower hereunder
(or any other
44
obligations of such Borrower to the Credit Parties and any other Person holding
any of the Obligations) to be avoidable or unenforceable against such Borrower
under any state fraudulent transfer or fraudulent conveyance act or statute
applied in any such case or proceeding by virtue of Section 544 of the
Bankruptcy Code; or
(iii) in a case or proceeding commenced by or against
such Borrower under any law, statute or regulation other than the Bankruptcy
Code relating to dissolution, liquidation, conservatorship, bankruptcy,
moratorium, readjustment of debt, compromise, rearrangement, receivership,
insolvency, reorganization or similar debtor relief from time to time in effect
affecting the rights of creditors generally (collectively, "OTHER DEBTOR RELIEF
LAW"), the maximum amount that would not otherwise cause the obligations of such
Borrower hereunder (or any other obligations of such Borrower to the Credit
Parties and any other Person holding any of the Obligations) to be avoidable or
unenforceable against such Borrower under such Other Debtor Relief Law,
including, without limitation, any state fraudulent transfer or fraudulent
conveyance act or statute applied in any such case or proceeding. (The
substantive state or federal laws under which the possible avoidance or
unenforceability of the obligations of either Borrower hereunder (or any other
obligations of such Borrower to the Credit Parties and any other Person holding
any of the Obligations) shall be determined in any such case or proceeding shall
hereinafter be referred to as the "AVOIDANCE PROVISIONS").
(b) To the extent set forth in Section 2.16(a), but only
to the extent that the Obligations of either Borrower incurred hereunder would
otherwise be subject to avoidance under any Avoidance Provisions, then the
obligations of such Borrower hereunder shall be reduced to that amount which,
after giving effect thereto, would not cause the Obligations of such Borrower
hereunder (or any other obligations of such Borrower to the Credit Parties or
any other Person holding any of the Obligations), as so reduced, to be subject
to avoidance under such Avoidance Provisions. The reduction effected by this
Section 2.16(b) is intended solely to preserve the rights hereunder of the
Credit Parties and any other Person holding any of the Obligations to the
maximum extent that would not cause the obligations of the Borrowers hereunder
to be subject to avoidance under any Avoidance Provisions, and neither of the
Borrowers nor any other Person shall have any right, defense, offset, or claim
under this Section 2.16(b) as against the Credit Parties or any other Person
holding any of the Obligations that would not otherwise be available to such
Person under the Avoidance Provisions.
(c) In the event either Borrower (the "FUNDING BORROWER")
shall make any payment or payments under this Agreement or shall suffer any loss
as a result of any realization upon any Collateral granted by it to secure its
obligations hereunder, the other Borrower (the "CONTRIBUTING BORROWER") shall
contribute to the Funding Borrower an amount equal to such payment or payments
made, or losses suffered, by the Funding Borrower determined as of the date on
which such payment or loss was made multiplied by the ratio of (i) the Maximum
Borrower Liability of the
45
Contributing Borrower (without giving effect to any right to receive any
contribution or other obligation to make any contribution hereunder), to (ii)
the aggregate Maximum Borrower Liability of both Borrowers (including the
Funding Borrower) hereunder (without giving effect to any right to receive, or
obligation to make, any contribution hereunder). Nothing in this Section 2.16(d)
shall affect either Borrower's joint and several liability to the Credit Parties
for the entire amount of its Obligations. Each Borrower covenants and agrees
that its right to receive any contribution hereunder from the Contributing
Borrower shall be subordinate and junior in right of payment to all of the
Obligations.
(d) Neither Borrower will exercise any rights which it may
acquire by way of subrogation hereunder or under any other Loan Document or at
law by any payment made hereunder or otherwise, nor shall either Borrower seek
or be entitled to seek any contribution or reimbursement from the other Borrower
in respect of payments made by such Borrower hereunder or under any other Loan
Document, until all amounts owing on account of the Obligations are indefeasibly
paid in full in cash and the Revolving Loan Commitment is terminated. If any
amounts shall be paid to either Borrower on account of such subrogation or
contribution rights at any time when all of the Obligations shall not have been
indefeasibly paid in full in cash, such amount shall be held by such Borrower in
trust for the Credit Parties, segregated from other funds of such Borrower, and
shall, forthwith upon receipt by such Borrower, be turned over to the
Administrative Agent in the exact form received by such Borrower (duly endorsed
by such Borrower to the Administrative Agent, if required), to be applied
against the Obligations, whether matured or unmatured, as provided for herein.
ARTICLE 3 - GUARANTEE
Section 3.1 GUARANTEE. Each of the Guarantors, jointly and
severally, hereby unconditionally guarantees to the Credit Parties and their
respective permitted successors and assigns and the subsequent holders of the
Obligations (including, without limitation, any interest on the Loans accruing
after the filing of a petition initiating any Insolvency Proceeding, whether or
not such interest accrues or is recoverable, against either Borrower after the
filing of such petition for purposes of the Bankruptcy Code or is an allowed
claim in such proceeding), irrespective of the validity and enforceability of
this Agreement, the Notes or the other Loan Documents or the Obligations of any
of the Borrower Parties hereunder or thereunder, the value or sufficiency of any
Collateral or any other circumstance that might otherwise affect the liability
of a guarantor, that: (a) the principal of and interest on the Loans, the Notes
and all other Obligations of the Borrower Parties to the Credit Parties under
this Agreement, the Notes and the other Loan Documents shall be promptly paid in
full when due, whether at stated maturity, by acceleration or otherwise, in
accordance with the terms hereof and thereof; and (b) in case of
any extension of time of payment or renewal of any Notes or any of such other
Obligations, the same shall be promptly paid in full when due in accordance with
the terms of the extension or renewal, whether at stated maturity, by
acceleration or
46
otherwise. The foregoing guaranty is a guaranty of payment and not of
collection. Failing payment when due of any amount so guaranteed for whatever
reason, the Guarantors will be obligated, jointly and severally, to pay the same
immediately.
Section 3.2 WAIVERS AND RELEASES. Each of the Guarantors hereby
waives notice of, and consents to, any extension of time of payment, renewals,
releases of Collateral, delays in obtaining or realizing upon or failures to
obtain, perfect, or maintain perfection of, or realize upon Collateral or other
indulgence from time to time granted by any of the Credit Parties in respect of
this Agreement, the Notes or any other Loan Document. Each of the Guarantors
hereby releases each of the Borrowers from all, and agrees not to assert or
enforce (whether by or in a legal or equitable proceeding or otherwise), any
"claims" (as defined in 11 U.S.C. ss. 101(4)), whether arising under Applicable
Law or otherwise, to which such Guarantors are or would be entitled by virtue of
their obligations hereunder, any payment made pursuant hereto or the exercise by
the Credit Parties of their rights with respect to any Collateral, including any
such claims to which such Guarantors may be entitled as a result of any right of
subrogation, exoneration or reimbursement. To the extent not released by such
Guarantors under this Article 3, each of the Guarantors agrees that it shall not
be entitled to any right of subrogation, exoneration, reimbursement or
contribution in respect of any Obligations guaranteed hereby. With respect to
this Agreement and the Notes, each of the Guarantors hereby waives presentment,
protest, demand of payment, notice of dishonor and all other notices and demands
whatsoever. Each of the Guarantors further agrees that, as between such
Guarantor, on the one hand, and the Credit Parties, on the other hand, (a) the
maturity of the Obligations guaranteed hereby may be accelerated as provided in
Section 9.2 hereof for the purposes of this Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Obligations guaranteed hereby, and (b) in the event of any declaration of
acceleration of such Obligations as provided in Section 9.2 hereof, such
Obligations (whether or not due and payable) shall forthwith become due and
payable by each of the Guarantors for purposes of this guarantee. The
obligations of the Guarantors under this Article 3 shall be automatically
reinstated if and to the extent that for any reason any payment by or on behalf
of the Borrowers is rescinded or must otherwise be restored by any holder of any
of the Obligations guaranteed hereunder, whether as a result of any Insolvency
Proceeding or otherwise, and each Guarantor agrees that it will, jointly and
severally, indemnify the Credit Parties on demand for reasonable costs and
expenses (including, without limitation, reasonable fees and expenses of
counsel) incurred by the Credit Parties in connection with such rescission or
restoration. Each Guarantor further agrees with the Borrowers for the benefit of
each of their respective creditors (including, without limitation, the Credit
Parties) that any payment referred to in this Article 3 by a Guarantor shall
constitute a contribution of capital by such Guarantor to such Borrower (or an
investment in the equity capital of such Borrower by such Guarantor).
47
Section 3.3 MISCELLANEOUS.
(a) Upon the bankruptcy or winding up or other distribution
of assets of any Borrower Party or of any surety or guarantor of any of the
Obligations of the Borrowers to the Credit Parties, the rights of the Credit
Parties against the Guarantors shall not be affected or impaired by the omission
of any Credit Party to prove its claim, or to prove its full claim, and the
Administrative Agent may prove such claims as it sees fit and may refrain from
proving any claim and in its discretion may value as it sees fit or refrain from
valuing any security held by it without in any way releasing, reducing or
otherwise affecting the liability to the Credit Parties of any Guarantor.
(b) Each of the Guarantors absolutely, unconditionally and
irrevocably waives any and all right to assert any defense, set-off,
counterclaim or cross-claim of any nature whatsoever with respect to this
Article 3 or the obligations of the Guarantors hereunder or the obligations of
any other Person or party (including, without limitation, either Borrower)
relating to this Article 3 or the obligations of any other guarantor with
respect to the Obligations in any action or proceeding brought by any Credit
Party to collect the Obligations or any portion thereof, or to enforce the
obligations of the Guarantors under this Article 3.
(c) If a claim is ever made upon any of the Credit Parties
for the repayment or recovery of any amount or amounts received by such Person
in payment of any of the Obligations and such Person repays all or part of such
amount by reason of (i) any judgment, decree or order of any court or
administrative body having jurisdiction over such Person or any of its property,
or (ii) any settlement or compromise of any such claim effected by such Person
with any such claimant, including either Borrower, then in such event the
Guarantors agree that any such judgment, decree, order, settlement or compromise
shall be binding upon the Guarantors, notwithstanding any revocation hereof or
the cancellation of any promissory note or other instrument evidencing any of
the Obligations, and the Guarantors shall be and remain obligated to such Person
hereunder for the amount so repaid or recovered to the same extent as if such
amount had never originally been received by such Person.
(d) The Guarantors expressly represent and acknowledge that
any financial accommodations by the Credit Parties, or any of them, to the
Borrowers, including, without limitation, the extension of the Loans, are and
will be of direct interest, benefit and advantage to the Guarantors.
(e) The Guarantors hereby agree among themselves that if
any Guarantor shall become an Excess Funding Guarantor by reason of the payment
by such Guarantor of any Obligations, each other Guarantor shall, on demand of
such Excess Funding Guarantor (but subject to the next sentence), pay to such
Excess Funding Guarantor an amount equal to such Guarantor's Pro Rata Share (as
determined, for this purpose, without reference to the properties, debts and
liabilities of such Excess Funding Guarantor) of the Excess Payment in respect
of such Obligations. The payment
48
obligation of a Guarantor to any Excess Funding Guarantor under this Section
3.3(e) shall be subordinate and subject in right of payment to the prior payment
in full of the obligations of such Guarantor under the other provisions of this
Article 3, and such Excess Funding Guarantor shall not exercise any right or
remedy with respect to such excess until payment and satisfaction in full of all
Obligations. For purposes of this Section 3.3(e), (i) "EXCESS FUNDING GUARANTOR"
shall mean, in respect of any Obligations, a Guarantor that has paid an amount
in excess of its Pro Rata Share of such Obligations, (ii) "Excess Payment" shall
mean, in respect of any Obligations, the amount paid by an Excess Funding
Guarantor in excess of its Pro Rata Share of such Obligations, and (iii) "PRO
RATA SHARE" shall mean, for any Guarantor, the ratio (expressed as a percentage)
of (A) the amount by which the aggregate present fair saleable value of all
properties of such Guarantor (excluding any shares of stock of any other
Guarantor) exceeds the amount of all the debts and liabilities of such Guarantor
(including contingent, subordinated, unmatured and unliquidated liabilities, but
excluding the obligations of such Guarantor hereunder and any obligations of any
other Guarantor that have been guaranteed by such Guarantor) to (B) the amount
by which the aggregate fair saleable value of all properties of all of the
Borrower Parties exceeds the amount of all the debts and liabilities (including
contingent, subordinated, unmatured and unliquidated liabilities, but excluding
the obligations of the Borrower Parties hereunder) of all of the Borrower
Parties, all as of the Agreement Date. If any Subsidiary becomes a Guarantor
hereunder subsequent to the Agreement Date, then for purposes of this Section
3.3(e) such subsequent Guarantor shall be deemed to have been a Guarantor as of
the Agreement Date and the aggregate present fair saleable value of the
properties, and the amount of the debts and liabilities, of such subsequent
Guarantor as of the Agreement Date shall be deemed to be equal to such value and
amount on the date such subsequent Guarantor becomes a Guarantor hereunder.
(f) Pursuant to Section 6.14 hereof, any new Subsidiary of
the Borrower is required to enter into this Agreement for purposes of joining in
this Guarantee by executing and delivering in favor of the Credit Parties a
Guarantee Supplement. Upon the execution and delivery of a Guaranty Supplement
by such new Subsidiary, such Subsidiary shall become a Guarantor hereunder with
the same force and effect as if originally named as a Guarantor herein. The
execution and delivery of any instrument adding an additional Guarantor
hereunder shall not require the consent of any party of this Agreement. The
rights and obligations of each Guarantor hereunder shall remain in full force
and effect notwithstanding the addition of any new Guarantor hereunder.
ARTICLE 4 - CONDITIONS PRECEDENT
Section 4.1 CONDITIONS PRECEDENT TO CLOSING. The obligation of each
of the Lenders to undertake its respective Revolving Loan Commitment and to make
the initial Advance of the Loans hereunder is subject to the prior fulfillment
of each of the following conditions:
49
(a) The Administrative Agent shall have received each of
the following, in form and substance reasonably satisfactory to the Arrangers
and their counsel and to the Majority Lenders:
(i) this duly executed Agreement;
(ii) the duly executed Notes;
(iii) the duly executed Borrower Security Agreement,
together with evidence of the filing of appropriate UCC-1 financing statements
forms;
(iv) the duly executed Borrower's Pledge Agreement,
together with appropriate original securities certificates and undated
securities powers with respect thereto executed in blank and evidence of the
filing of appropriate UCC-1 financing statement forms;
(v) a loan certificate of each Borrower, including a
certificate of incumbency with respect to the signature of each Authorized
Signatory of such Borrower, which loan certificate shall be in substantially the
form of EXHIBIT N attached hereto, together with appropriate attachments which
shall include, without limitation, the following items: (A) true, complete and
correct copies of the Constituent Documents of such Borrower, (B) a true,
complete and correct copy of the Consulting Agreement, (C) a copy of the
partnership resolutions of such Borrower, authorizing such Borrower with respect
to the borrowing hereunder and the execution, delivery and performance by such
Borrower of this Agreement and the other Loan Documents to which it is a party,
and (D) certificates of existence for such Borrower issued by the Secretary of
State or similar state official for the State of New York and for each state in
which such Borrower is, or is required to be, qualified to do business;
(vi) the duly executed Partnership Pledge Agreement,
together with evidence of the filing of appropriate UCC-1 financing statement
forms;
(vii) a loan certificate of each RMG Partner,
including a certificate of incumbency with respect to the signature of each
Authorized Signatory of such RMG Partner, which loan certificate shall be in
substantially the form of EXHIBIT O attached hereto, together with appropriate
attachments which shall include, without limitation, the following items: (A) a
true, complete and correct copy of the articles of incorporation of such RMG
Partner, certified by the Secretary of State of such RMG Partner's
incorporation, (B) a true, complete and correct copy of the bylaws of such RMG
Partner, (C) a copy of the resolutions of the board of directors of such RMG
Partner, authorizing such RMG Partner with respect to the execution, delivery
and performance by such RMG Partner of the Loan Documents to which it is a
party, and (D) certificates of existence for such RMG Partner issued by the
Secretary of State or similar state official for the State of such RMG Partner's
incorporation, and for each state in which such RMG Partner is, or is required
to be, qualified to do business;
50
(viii) a loan certificate of RMHI, including a
certificate of incumbency with respect to the signature of each Authorized
Signatory of RMHI, which loan certificate shall be in substantially the form of
EXHIBIT P attached hereto, together with appropriate attachments which shall
include, without limitation, the following items: (A) a true, complete and
correct copy of the articles of incorporation of RMHI, certified by the
Secretary of State of Delaware, (B) a true, complete and correct copy of the
bylaws of RMHI, (C) a copy of the resolutions of the board of directors of RMHI,
authorizing RMHI with respect to the execution, delivery and performance by RMHI
of the Loan Documents to which it is a party, and (D) certificates of existence
for RMHI issued by the Secretary of State or similar state official for the
State of Delaware and for each state in which RMHI is, or is required to be,
qualified to do business;
(ix) the duly executed Subsidiary Pledge Agreement
from each Guarantor which has one or more Subsidiaries, together with
appropriate original securities certificates and undated securities powers with
respect thereto executed in blank and evidence of the filing of appropriate
UCC-1 financing statement forms;
(x) the duly executed Subsidiary Security Agreement
from each Guarantor, together with evidence of the filing appropriate UCC-1
financing statement forms;
(xi) a certificate of each Guarantor, including a
certificate of incumbency with respect to the signature of each Authorized
Signatory of such Subsidiary, which loan certificate shall be in substantially
the form of EXHIBIT Q attached hereto, together with appropriate attachments
which shall include, without limitation, the following items: (A) a true,
complete and correct copy of the articles of incorporation, certificate of
limited partnership or certificate of organization of such Guarantor, certified
by the Secretary of State of such Guarantor's organization, (B) a true, complete
and correct copy of by-laws, partnership agreement or limited liability company
or operating agreement of such Guarantor, (C) a copy of the resolutions of the
board of directors, or other appropriate entity, of such Guarantor, authorizing
such Guarantor with respect to the execution, delivery and performance by such
Guarantor of this Agreement and the other Loan Documents to which it is a party,
(D) certificates of existence for such Guarantor issued by the Secretary of
State or similar state official for the state of such Guarantor's organization
and for each state in which such Guarantor is, or is required to be, qualified
to do business, and (E) a true, complete and correct copy of any agreement in
effect with respect to the voting rights, ownership interests or management of
such Guarantor;
(xii) the duly executed Trademark Security Agreement,
together with an appropriate filing coversheet and evidence of the filing of
appropriate UCC-1 financing statement forms;
51
(xiii) the duly executed Fee Letters, together with
evidence of receipt of all fees due on the Agreement Date from the Borrowers to
the Credit Parties in accordance therewith;
(xiv) opinions of counsel to the Borrowers, RMHI, the
RMG Partners and the Guarantors addressed to each Credit Party and in form and
substance satisfactory to the Arrangers and their counsel;
(xv) a copy of the organizational chart of the
Borrowers and their respective Subsidiaries;
(xvi) a copy of (A) the audited combined balance
sheets and income statements for the MGM Companies and (B) the unaudited
combining balance sheets and income statements for the MGM Companies, in each
case for the year ended December 31, 2000, and a copy of the unaudited combined
balance sheets and income statements for the MGM Companies for the quarter ended
September 30, 2001;
(xvii) the duly executed Subordination of Fees
Agreement and the duly executed Subordination of Tax Liabilities Agreement; and
(xviii)copies of insurance binders or certificates
covering the assets of the Borrower Parties, and otherwise meeting the
requirements of, and to the extent required by, Section 6.5 hereof.
(b) All of the representations and warranties of the
Borrowers under this Agreement shall be true and correct in all material
respects, and the Administrative Agent shall have received a certificate of an
Authorized Signatory of each of the Borrowers so stating.
(c) No litigation shall have been commenced against any of
the Borrower Parties since December 31, 2000, which, if such litigation could
reasonably be expected to be determined adversely to such Borrower Parties,
could reasonably be expected to have a Materially Adverse Effect.
(d) There shall have been no material adverse change in the
business, assets or financial condition of the Borrower Parties from that
reflected in the audited financial statements, provided pursuant to Section
4.1(a)(xvi) hereof.
(e) The Arrangers shall have received the results of lien
searches against each of the Borrower Parties from all applicable jurisdictions
which shall be reasonably satisfactory to them and their counsel.
(f) The Administrative Agent shall have received a
certificate of an Authorized Signatory of each of the Borrowers demonstrating,
on a pro forma basis, as of the Agreement Date, that the Leverage Ratio
calculated as of the Agreement Date,
52
based on Annualized Cash Flow as of the last day of the fiscal quarter ending
September 30, 2001, and Total Debt after giving effect to the initial Advance of
the Loans hereunder, is less than or equal to 2.00 to 1.00.
Section 4.2 CONDITIONS PRECEDENT TO EACH ADVANCE. The obligations
of the Lenders to make each Advance (including the initial Advance hereunder) of
the Loans (including the Swing Loans) is subject to the fulfillment of each of
the following conditions immediately prior to or contemporaneously with such
Advance:
(a) The Administrative Agent, or in the case of a Swing
Loan, the Swing Loan Lender, shall have received a duly executed and completed
Request for Advance or Swing Loan Request, as applicable, signed by an
Authorized Signatory of a Borrower, which Request for Advance or Swing Loan
Request, as applicable, shall (i) certify that, after giving effect to the
requested Advance, no Default or Event of Default shall then exist, (ii) certify
that, as of the date of the requested Advance and after giving effect to the
application of proceeds thereof, the representations and warranties in Section
5.1 hereof shall be true and correct in all material respects, except to the
extent any representation or warranty is made solely as of the Agreement Date,
(iii) certify that, as of the date of the requested Advance, there shall exist
no litigation commenced against any of the Borrower Parties since December 31,
2000, which, if such litigation could reasonably be expected to be determined
adversely to such Borrower Parties, could reasonably be expected to have a
Materially Adverse Effect, and (iv) provide calculations demonstrating the
Borrowers' compliance with Section 8.8 hereof before and after giving effect to
the requested Advance;
(b) There shall have occurred no event which has had or
could reasonably be expected to have a Materially Adverse Effect since the date
of the most recent audited financial statements provided to the Credit Parties;
and
(c) Each Request for Advance and each Swing Loan Request
shall constitute a representation and warranty by the Borrowers made as of the
time of requesting such Advance that the conditions specified in this Section
4.2 have been fulfilled as of the time of such Advance.
ARTICLE 5 - REPRESENTATIONS AND WARRANTIES
Section 5.1 REPRESENTATIONS AND WARRANTIES. Each of the Borrowers
hereby agrees, represents, and warrants that:
(a) ORGANIZATION; POWER; QUALIFICATION. Each of the
Borrowers is a general partnership duly organized and validly existing under the
laws of the State of New York, having the RMG Partners and the MGM Partner as
its only partners. The Managing Partners are the only managing partners of each
of the Borrowers. Each of the Guarantors is duly organized and validly existing
under the laws of the jurisdiction of its organization. Each of the Borrower
Parties has the power and authority to own or lease
53
and operate its properties and to carry on its business as now being and
hereafter proposed to be conducted, and is duly qualified and authorized to do
business in each jurisdiction in which such qualification is necessary in view
of the character of its properties or the nature of its business requires such
qualification or authorization, except for qualifications and authorizations,
the lack of which, singly or in the aggregate, has not had and is not likely to
have a Materially Adverse Effect.
(b) AUTHORIZATION; ENFORCEABILITY. Each of the Borrower
Parties has all power, corporate or otherwise, and has taken all necessary
action to authorize it to execute, deliver, and perform this Agreement and each
of the other Loan Documents to which it is a party in accordance with the terms
thereof and to consummate the transactions contemplated hereby and thereby. This
Agreement has been duly executed and delivered by each of the Borrower Parties,
and is, and the Notes, when issued for value received will be, and each of the
other Loan Documents to which any Borrower Party is a party is, a legal, valid
and binding obligation of such Borrower Party enforceable in accordance with its
terms, subject to limitations on enforceability under bankruptcy,
reorganization, insolvency and similar laws affecting creditors' rights
generally and limitations on the availability of the remedy of specific
performance imposed by the application of general equity principles.
(c) SUBSIDIARIES. Except as listed on SCHEDULE 5.1(c)
attached hereto (as amended by the Borrowers after the Agreement Date upon
written notice to the Lenders from time to time to the extent permitted
hereunder), neither of the Borrowers has any Subsidiaries. With respect to each
of the Borrower Parties, SCHEDULE 5.1(c) also sets forth, as of the Agreement
Date, the following: (i) whether such Borrower Party is a MGM Operating Company;
(ii) the direct owners of such Borrower Party and the extent of such ownership;
(iii) the state of such Borrower Party's incorporation or organization; (iv) all
jurisdictions in which such Borrower Party is qualified to do business as a
foreign corporation, limited liability company or partnership, as the case may
be; and (v) the federal tax identification number, the state organizational
identification number (if issued by the state of such Borrower Party's
incorporation or organization), the address of the chief executive office and
principal place of business of such Borrower Party, and the name and registered
office of the registered agent appointed by such Borrower Party.
(d) COMPLIANCE WITH LAWS, OTHER LOAN DOCUMENTS, AND
CONTEMPLATED TRANSACTIONS. The execution, delivery, and performance of this
Agreement and each of the other Loan Documents in accordance with the terms and
the consummation of the transactions contemplated hereby and thereby do not and
will not (i) violate any Applicable Law, (ii) result in a breach of, or
constitute a default under the certificate or articles of incorporation, by-laws
or other governing documents, as the case may be and as amended, of any of the
Borrower Parties, or under any Material MSO Agreement, or under any indenture,
agreement, or other instrument to which any of the Borrower Parties is a party
or by which it or any of its properties may be bound, or (iii) result in or
require the creation or imposition of any Lien upon or with respect to any
54
property now owned or hereafter acquired by any of the Borrower Parties except
Permitted Liens; except, with respect to items (i) and (ii) above, where such
violations, breaches or defaults, if any, singly or in the aggregate, has not
had and is not likely to have a Materially Adverse Effect.
(e) NECESSARY AUTHORIZATIONS. No approval or consent of, or
filing or registration with, any federal, state or local commission or other
regulatory authority is required in connection with (i) the execution, delivery
and performance by either of the Borrowers of this Agreement, the Notes and the
other Loan Documents to which such Borrower is a party, or (ii) the execution,
delivery and performance by any Guarantor of this Agreement and the other Loan
Documents to which such Guarantor is a party. All such described action required
to be taken as a condition to the execution and delivery of each of this
Agreement, the Notes and other Loan Documents to which any Borrower Party is a
party has been duly taken by all such commissions and authorities or other
Persons, as the case may be, and all such action required to be taken as a
condition to the initial Advance of the Loans hereunder has been or will be duly
taken prior to such initial Advance.
(f) TITLE TO PROPERTIES. Each of the Borrower Parties has
good and legal title to, or a valid leasehold interest in, all of their
respective material properties and assets free and clear of all Liens, except
Permitted Liens.
(g) COLLECTIVE BARGAINING. None of the Borrower Parties has
entered into any collective bargaining agreement with any trade or labor union
or other employee collective bargaining agent.
(h) TAXES. All federal, state, and other tax returns of
each of the Borrower Parties required by law to be filed have been duly filed,
and all federal, state, and other taxes, assessments, and other governmental
charges or levies upon each Borrower Party, and any of its respective
properties, income, profits, and assets, which are due and payable, have been
paid, except any such tax payment of which such Borrower Party is contesting in
good faith by appropriate proceedings, and as to which neither any Lien other
than a Permitted Lien has attached nor any foreclosure, distraint, sale, or
similar proceedings have been commenced, and except any such tax payments which
the failure to pay, singly or in the aggregate, has not had and is not likely to
have a Materially Adverse Effect. The charges, accruals, and reserves on the
books of each of the Borrower Parties in respect of taxes are, in the reasonable
judgment of the Borrowers, adequate.
(i) FINANCIAL STATEMENTS. The Borrowers have furnished, or
caused to be furnished, to the Credit Parties the financial statements required
pursuant to Section 4.1(a)(xvi), all of which are complete and correct in all
material respects and present fairly in accordance with GAAP the financial
position of the Borrower Parties as at the dates thereof, and the results of
operations for the periods ended as of such dates, subject to normal year-end
adjustments with respect to such unaudited statements.
55
Except as disclosed in such financial statements or in SCHEDULE 5.1(i) attached
hereto, none of the Borrower Parties had any material liabilities, contingent or
otherwise, and there are no material unrealized or anticipated losses of any of
the Borrower Parties which have not heretofore been disclosed in writing to the
Credit Parties.
(j) NO ADVERSE CHANGE. Since December 31, 2000, there has
occurred no event which has had or could reasonably be expected to have a
Materially Adverse Effect.
(k) INVESTMENTS AND GUARANTIES. None of the Borrower
Parties has made Investments in, advances to or guaranties of the obligations of
any Person, except as reflected in the financial statements referred to in
Section 5.1(i) above or disclosed in SCHEDULE 5.1(k) attached hereto.
(l) LIABILITIES, LITIGATION, ETC. Except (i) for
liabilities incurred in the normal course of business, (ii) as disclosed or
referred to in the financial statements described in Section 5.1(i) above, or
(iii) as disclosed on SCHEDULE 5.1(l) attached hereto, none of the Borrower
Parties has any material (individually or in the aggregate) direct or contingent
liabilities. Except as disclosed on SCHEDULE 5.1(l) attached hereto, there is no
litigation, legal or administrative proceeding, investigation, or other action
of any nature pending or, to the knowledge of either of the Borrowers,
threatened against or affecting any of the Borrower Parties or any of their
respective properties which involves the possibility of any judgment or
liability not fully covered by insurance that, singly or in the aggregate, could
reasonably be expected to have a Materially Adverse Effect.
(m) ERISA. Each Plan maintained, or contributed to, by any
of the Borrower Parties or any of their ERISA Affiliates is listed on SCHEDULE
5.1(m) attached hereto. Each of such Plans is in compliance in all material
respects with their terms, ERISA and the Code. None of such Plans has a material
"accumulated funding deficiency" within the meaning of ERISA or the Code. None
of the Borrower Parties nor any of their respective ERISA Affiliates has
incurred any material liability to the PBGC in connection with any such Plan.
The assets of each such Plan which is subject to Title IV of ERISA are
sufficient to provide the benefits under such Plan if such Plan were determined
on an ongoing basis. No Reportable Event, for which the thirty (30) day notice
provision has not been waived in accordance with ERISA Section 4043(a), has
occurred with respect to any such Plan. No party in interest, fiduciary, trustee
or administrator of any such Plan or trust created thereunder has engaged in a
"prohibited transaction" (as such term is defined in Section 406 of ERISA or
Section 4975 of the Code which is not statutorily or administratively exempt
under Sections 407 or 408 of ERISA or Section 4975 of the Code, each of which
exemptions are disclosed on SCHEDULE 5.1(m)) which would subject any of the
Borrower Parties or any of their respective ERISA Affiliates to a material tax
on "prohibited transactions" imposed by Section 4975 of the Code; provided that
this representation and warranty is based upon the Borrowers' understanding
provided by Lenders that the source of the Loans will not at any time
56
constitute assets of any such Plan. No party in interest, fiduciary, trustee or
administrator of any such Plan or trust created thereunder has committed a
material breach of its fiduciary duty or knowingly participated in any violation
of ERISA which would subject any of the Borrower Parties or any of their
respective ERISA Affiliates to a material penalty under Section 502 of ERISA.
Except as set forth on SCHEDULE 5.1(m), none of the Borrower Parties nor any of
their respective ERISA Affiliates is a participant in or obliged to make any
payment to a Multiemployer Plan. Except as required by Sections 601 through 609
of ERISA or as disclosed on SCHEDULE 5.1(m), Section 4980(b) of the Code and
applicable state law, none of the Borrower Parties has made any oral or written
commitments to provide post-employment health or life insurance coverage with
respect to any former or current employee. The Borrower Parties and the ERISA
Affiliates have properly classified individuals providing services to any of the
Borrower Parties or ERISA Affiliates as employees and non-employees, except to
the extent that a misclassification would not result in a Materially Adverse
Effect.
(n) PATENTS, TRADEMARKS, ETC. SCHEDULE 5.1(n) attached
hereto sets forth all registered trademarks and pending applications for
trademarks of each of the Borrower Parties. Except as disclosed on SCHEDULE
5.1(n) attached hereto (as amended by the Borrowers upon written notice to the
Lenders from time to time, together with, if necessary, an amendment to the
Trademark Security Agreement reflecting the addition of any new trademarks or
trademark applications), each of the Borrower Parties owns, possesses or has the
right to use all licenses and rights to all patents, trademarks, trademark
rights, trade names, trade name rights, service marks, and copyrights, and
rights with respect thereto, necessary to conduct its business in all material
respects as now conducted, without known conflict with any patent, trademark,
trade name, service xxxx, license or copyright of any other Person, and in each
case, with respect to patents, trademarks, trademark rights, trade names, trade
name and copyrights and licenses with respect thereto owned by the Borrower
Parties, subject to no mortgage, pledge, lien, lease, encumbrance, charge,
security interest, title retention agreement or option other than as otherwise
permitted hereunder. Except to the extent that there is not likely to be a
Materially Adverse Effect resulting from such ineffectiveness or non-compliance,
all such licenses and rights with respect to patents, trademarks, trademark
rights, trade names, trade name rights, service marks and copyrights are in full
force and effect, and to the extent applicable, each of the Borrower Parties is
in full compliance in all material respects with all of the provisions thereof.
Except as set forth on SCHEDULE 5.1(n) attached hereto (as amended by the
Borrowers upon written notice to the Lenders from time to time), no such patent,
trademark, trademark rights, trade names, trade name rights, service marks,
copyrights or licenses is subject to any pending or, to the best of the
Borrowers' knowledge, threatened attack or revocation. Except as set forth on
SCHEDULE 5.1(n) attached hereto, (i) none of the Borrower Parties owns any
registered copyrights or patents and (ii) the business of the Borrower Parties
is not subject to any license issued by the FCC.
57
(o) COMPLIANCE WITH LAW; ABSENCE OF DEFAULT. Each of the
Borrower Parties is in compliance with all Applicable Laws the non-compliance
with which is likely to have a Materially Adverse Effect and with all of the
provisions of its articles or certificate of incorporation and by-laws, or other
governing documents, as applicable, which would adversely affect any Borrower
Party's ability to perform the Obligations, and no event has occurred or has
failed to occur which has not been remedied or waived, the occurrence or
non-occurrence of which constitutes (i) a Default or (ii) a default by any
Borrower Party under any other indenture, agreement, or other instrument, or
under any Material MSO Agreement or Material Film Rights Agreement, or any
judgment, decree, or order to which such Borrower Party is a party or by which
such Borrower Party, or any of its properties, may be bound, which default,
judgment, decree or order could reasonably be considered to have a Materially
Adverse Effect.
(p) CASUALTIES; TAKING OF PROPERTIES, ETC. Since the date
of the most recent financial statements provided to the Credit Parties by the
Borrower, neither the business nor the properties of any of the Borrower Parties
has been materially and adversely affected as a result of any fire, explosion,
earthquake, flood, drought, windstorm, accident, strike or other labor
disturbance, embargo, requisition or taking of property or cancellation of
contracts, permits or concessions by any domestic or foreign government or any
agency thereof, riot, activities of armed forces, or acts of God or of any
public enemy.
(q) ACCURACY AND COMPLETENESS OF INFORMATION. None of the
financial statements or any written statements delivered to any of the Credit
Parties pursuant to this Agreement contains, as at the date of delivery thereof,
any untrue statement of material fact nor do such financial statements, and such
written statements, taken as a whole, omit to state a material fact or any fact
necessary to make the statements contained therein not misleading. As of the
Agreement Date and as supplemented by the Borrowers from time to time pursuant
to Section 7.4(f), SCHEDULE 5.1(q) attached hereto sets forth certain summary
information with respect to each Material Film Rights Agreement and each
Material MSO Agreement to which any of the Borrower Parties is a party.
(r) COMPLIANCE WITH REGULATIONS U AND X. None of the
Borrower Parties is engaged principally or as one of its important activities in
the business of extending credit for the purpose of purchasing or carrying, and
neither of the Borrowers owns or presently intends to acquire, any "margin
security" or "margin stock" as defined in Regulations U and X (12 C.F.R. Parts
221 and 224) of the Board of Governors of the Federal Reserve System (herein
called "margin stock"). None of the proceeds of the Loans will be used, directly
or indirectly, for the purpose of purchasing or carrying any margin stock or for
the purpose of reducing or retiring any Indebtedness which was originally
incurred to purchase or carry margin stock or for any other purpose which would
constitute this transaction a "purpose credit" within the meaning of said
Regulations U and X. Neither of the Borrowers nor any bank acting on its or
their behalf
58
has taken or will take any action which would cause this Agreement or the Notes
to violate Regulation U or X or any other regulation of the Board of Governors
of the Federal Reserve System or to violate the Securities Exchange Act of 1934.
If so requested by the Administrative Agent, the Borrowers will furnish the
Administrative Agent with (i) a statement or statements in conformity with the
requirements of Federal Reserve Form U-1 referred to in Regulation U of said
Board of Governors and (ii) other documents evidencing its compliance with the
margin regulations, including, without limitation, an opinion of counsel in form
and substance reasonably satisfactory to the Lenders.
(s) SOLVENCY. Each of the Borrowers is, and after giving
effect to the transactions contemplated hereby and by the Loan Documents will
be, Solvent.
(t) BROKER'S OR FINDER'S COMMISSIONS. No broker's or
finder's fee or commission will be payable with respect to the issuance of the
Notes, and no other similar fees or commissions will be payable by either of the
Borrowers for any other services rendered to either or both of the Borrowers
ancillary to the transactions contemplated herein.
(u) BUSINESS. The business of the Borrower Parties includes
producing and acquiring various types of programming and distributing such
programming to cable and other non-broadcast delivery systems.
(v) NAME OF BORROWERS. Except as set forth on
SCHEDULE 5.1(v) attached hereto, none of the Borrower Parties has (i) changed
its name within the five (5) year period immediately preceding the Agreement
Date nor (ii) transacted business under any other name or trade name or acquired
any assets except for valid consideration.
(w) INVESTMENT COMPANY ACT. None of the Borrower Parties is
required to register under the provisions of the Investment Company Act of 1940,
as amended, and neither the entering into or performance by either of the
Borrowers of this Agreement nor the issuance of the Notes violates any provision
of such Act or requires any consent, approval, or authorization of, or
registration with, any governmental or public body or authority pursuant to any
of the provisions of such Act.
Section 5.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC. All
representations and warranties made under this Agreement shall be deemed to be
made, and shall be true and correct in all material respects, at and as of the
Agreement Date and on the date of each Advance, except to the extent any
representation or warranty is made solely as of the Agreement Date in accordance
with the terms hereof. All representations and warranties made under this
Agreement shall survive, and not be waived by, the execution hereof by the
Credit Parties, any investigation or inquiry by any of the Credit Parties or the
making of any Advance under this Agreement.
59
ARTICLE 6 - GENERAL COVENANTS
So long as any of the Obligations is outstanding and unpaid or the
Borrowers shall have the right to borrow hereunder (whether or not the
conditions to borrowing have been or can be fulfilled), and unless the Majority
Lenders shall otherwise consent in writing:
Section 6.1 PRESERVATION OF EXISTENCE AND SIMILAR MATTERS. Each of
the Borrowers will, and will cause each of the Guarantors to, (a) preserve and
maintain their respective existence, rights, licenses and privileges in their
respective jurisdictions of organization and (b) qualify and remain qualified
and authorized to do business in each jurisdiction in which such qualification
is necessary in view of the character of their respective properties or in which
the nature of their respective businesses requires such qualification or
authorization, except for qualifications and authorizations, the lack of which,
singly or in the aggregate, has not had and is not likely to have a Materially
Adverse Effect; PROVIDED, HOWEVER, any of the Borrower Parties may liquidate or
dissolve, or cause the liquidation or dissolution of, any Subsidiary of either
of the Borrowers that holds no assets and conducts no business activities.
Section 6.2 COMPLIANCE WITH APPLICABLE LAW. Each of the Borrowers
will comply, and will cause each of the Guarantors to comply, with the
requirements of all Applicable Law, except where failure to comply has not had
and is not likely to have a Materially Adverse Effect.
Section 6.3 MAINTENANCE OF PROPERTIES. Each of the Borrowers will
maintain, and will cause each of the Guarantors to maintain, or cause to be
maintained in the ordinary course of business in good repair, working order, and
condition all properties necessary in their respective businesses (whether owned
or held under lease).
Section 6.4 ACCOUNTING METHODS AND FINANCIAL RECORDS. Each of the
Borrowers will maintain, and will cause each of the Guarantors to maintain, or
will maintain on their behalf, a system of accounting established and
administered in accordance with GAAP, and will, keep and cause each of the
Guarantors to keep adequate records and books of account in which complete
entries will be made in accordance with such accounting principles consistently
applied and reflecting all transactions required to be reflected by such
accounting principles.
Section 6.5 INSURANCE. Each of the Borrowers will, and will cause
each of the Guarantors to:
(a) maintain or cause to be maintained (i) insurance on the
assets and properties and on its operations including, but not limited to,
public liability, business interruption and fidelity coverage insurance, from
responsible insurance companies in such amounts and against such risks as shall
be reasonably acceptable to the Majority Lenders and (ii) maintain insurance
coverage comparable to that in place on the
60
Agreement Date, taking into account the growth of their respective businesses
and operations after the Agreement Date; and
(b) maintain insurance coverage with respect to the
Collateral, comparable to that in place on the Agreement Date (taking into
account any increase in value with respect to the Collateral) insuring against
loss or damage by fire, theft, burglary, pilferage, loss in transit, explosions
and hazards insured against by extended coverage, all premiums thereon to be
paid, jointly and severally, by the Borrowers; and
(c) require that each insurance policy on its assets and
properties name the Administrative Agent, as administrative agent for the Credit
Parties, as additional insured and loss payee to the extent of the Obligations,
and provide for at least thirty (30) days' prior written notice to the
Administrative Agent of any default under, termination of or proposed
cancellation or nonrenewal of, such policy.
Section 6.6 PAYMENT OF TAXES AND CLAIMS. Each of the Borrowers will
pay and discharge, and will cause each of the Guarantors to pay and discharge,
all taxes, assessments, and governmental charges or levies imposed upon them or
upon their respective incomes or profits or upon any properties belonging to
them prior to the date on which penalties attach thereto, and all lawful claims
for labor, materials, and supplies which, if unpaid, would become a Lien other
than a Permitted Lien upon any of their respective properties; except that no
such tax, assessment, charge, levy, or claim need be paid which is being
contested in good faith by appropriate proceedings and for which adequate
reserves shall have been set aside on the appropriate books, but only so long as
such tax, assessment, charge, levy, or claim does not become a Lien or charge
other than a Permitted Lien and no foreclosure, distraint, sale, or similar
proceedings shall have been commenced and remain unstayed for a period of thirty
(30) days after such commencement.
Section 6.7 VISITS AND INSPECTIONS. Each of the Borrowers will
permit, and will cause each of the Guarantors to permit, representatives of (a)
prior to a Default, the Arrangers upon three (3) Business Days written notice to
the Borrowers, and (b) subsequent to a Default, each Credit Party, upon notice
prior to 10:00 a.m. (New York time) on such date, to (a) visit and inspect the
properties of each of the Borrower Parties during normal business hours, (b)
inspect and make extracts from and copies of their respective books and records,
and (c) discuss with their respective principal officers their respective
businesses, assets, liabilities, financial positions, results of operations, and
business prospects relating to each of the Borrower Parties.
Section 6.8 PAYMENT OF INDEBTEDNESS. Each of the Borrowers will
pay, and will cause each of the Guarantors to pay, subject to any provisions
therein regarding subordination, any and all of their respective Indebtedness
For Money Borrowed when and as the same becomes due, other than amounts duly
disputed in good faith, the non-payment of which is not likely to have a
Materially Adverse Effect.
61
Section 6.9 USE OF PROCEEDS. The Borrowers will use the proceeds of
the Loans solely as provided in Section 2.1(c).
Section 6.10 ERISA. Each of the Borrowers shall, and shall cause
each of the Guarantors to, at all times make, or cause to be made, prompt
payment of all material contributions required under the terms of their Plans
and to meet the minimum funding standards set forth in ERISA with respect to
such Plans. Each of the Borrowers shall maintain, and shall cause each of the
Guarantors to maintain, each of their respective Plans in material compliance
with the terms of such Plans and the applicable provisions of ERISA and the
Code.
Section 6.11 FURTHER ASSURANCES. Each of the Borrowers will promptly
cure, or cause to be cured, defects in the creation and issuance of the Notes
and the execution and delivery of the Loan Documents (including, without
limitation, this Agreement), resulting from any act or failure to act by any of
the Borrower Parties or any employee or officer thereof. Each of the Borrowers
at its expense will promptly execute and deliver to the Credit Parties, or cause
to be executed and delivered to the Credit Parties, all such other and further
documents, agreements, and instruments in compliance with or for the
accomplishment of the covenants and agreements of the Borrowers in the Loan
Documents (including, without limitation, this Agreement), or to correct any
omissions in the Loan Documents, or more fully to state the obligations set out
herein or in any of the Loan Documents, or to obtain any consents, all as may be
necessary or appropriate in connection therewith and as may be reasonably
requested.
Section 6.12 BROKER'S CLAIMS. The Borrowers hereby, jointly and
severally, indemnify and agree to hold each of the Credit Parties harmless from
and against any and all losses, liabilities, damages, costs and expenses which
may be suffered or incurred by the Credit Parties, or any of them, in respect of
any claim, suit, action or cause of action now or hereafter asserted by a broker
or any Person acting in a similar capacity arising from or in connection with
the execution and delivery of this Agreement or any other Loan Document or the
consummation of the transactions contemplated herein or therein.
Section 6.13 INDEMNITY. Each of the Borrower Parties, jointly and
severally, will indemnify and hold harmless each of the Credit Parties and each
of their respective Lender Affiliates, employees, representatives, officers and
directors (collectively, the "INDEMNIFIED PARTIES") from and against any and all
claims, liabilities, losses, damages, actions, and demands by any party (other
than with respect to any claims, actions or demands made by other such
indemnified parties or any liabilities, losses or damages caused thereby)
against such Credit Party, resulting from any breach or alleged breach by any of
the Borrower Parties of any representation or warranty made hereunder or
otherwise arising out of the Commitments or the making, administration or
enforcement of the Loan Documents and the Loans; unless, with respect to any of
the
62
above, such Credit Party is finally judicially determined to have acted or
failed to act with gross negligence or willful misconduct.
Section 6.14 COVENANTS REGARDING FORMATION OF SUBSIDIARIES,
INVESTMENTS AND ACQUISITIONS. In connection with the consummation of any
Acquisition or any Investment made by any of the Borrower Parties, or the
formation of any new Subsidiary of any of the Borrower Parties, as soon as
available and in any event on or before the effective date thereof, the
Borrowers will, and will cause each of the Guarantors to, provide to the
Administrative Agent the following (all of which shall be in such form and
substance as shall be acceptable to the Arrangers): (a) a duly executed joinder
and supplement to this Agreement, in the form of Exhibit R attached hereto (each
a "GUARANTEE SUPPLEMENT"), pursuant to which each new Guarantor shall agree to
join as a Guarantor of the Obligations under Article 3 hereof; (b) a duly
executed supplement to the Subsidiary Security Agreement for each new Guarantor,
together with appropriate UCC-1 financing statement forms; (c) a loan
certificate for each new Guarantor, substantially in the form of Exhibit Q
attached hereto, together with appropriate attachments thereto; (d) in the case
of any new Guarantor holding any issued and outstanding shares of capital stock
(or other instruments or securities evidencing ownership) of any other Borrower
Party, a duly executed supplement to the Subsidiary Pledge Agreement, pursuant
to which such new Guarantor shall pledge to the Administrative Agent all of such
capital stock (or other instruments or securities evidencing ownership) held by
it, whether now owned or hereafter acquired; (e) a duly executed amendment to
the Borrower Pledge Agreement or the Subsidiary Pledge Agreement, as applicable,
pursuant to which (i) all of the issued and outstanding capital stock (or other
instruments or securities evidencing ownership)of each new Guarantor shall be
pledged to the Administrative Agent as additional Collateral for the
Obligations, and (ii) to the extent, except with respect to any Investment made
pursuant to Section 8.2(c) hereof, that the pledge of any such shares or other
interests in or with respect to any Company that is not wholly-owned directly or
indirectly by the Borrower will not (A) violate the Constituent Documents
applicable to such Company (and, if the pledge of any such shares or other
interests will violate any of such Constituent Documents, such shares or other
interests shall be held by the Borrower Parties subject to the terms and
conditions of this Agreement and the other Loan Documents) and (B) require the
consent of any unaffiliated third party (which consent the Borrowers are unable
to obtain after taking reasonable steps to do so), all shares of capital stock
(or other instruments or securities evidencing ownership) with respect to any
Investment (including, without limitation, any Investment made pursuant to
Section 8.2(c) hereof) beneficially owned or held by any of the Borrower Parties
shall be pledged to the Administrative Agent as additional Collateral for the
Obligations, together with all original securities certificates, duly executed
securities powers and appropriate UCC-1 financing statement forms; and (f) all
other documentation, including, without limitation, (i) an amendment to the
Trademark Security Agreement covering any additional registered trademarks or
trademark applications owned by any of the Borrower Parties, (ii) to the extent
reasonably available, financial information with respect to the designation of
any new
63
MGM Operating Company for the most recent period ending immediately prior to the
date of such designation, and other financial information, to the extent
available, which in the reasonable opinion of the Arrangers and the Majority
Lenders is appropriate with respect to such designation of a new MGM Operating
Company to confirm compliance with the terms and conditions of this Agreement,
and (iii) to the extent reasonably requested by the Administrative Agent one or
more opinions of counsel satisfactory to the Administrative Agent which in the
reasonable opinion of the Administrative Agent is appropriate with respect to
the Acquisition or formation of any new Guarantor or the addition of any new
Collateral as security for the Obligations. Any document, agreement or
instrument executed or issued pursuant to this Section 6.14 shall be and
constitute a "Loan Document" for purposes of this Agreement.
ARTICLE 7 - INFORMATION COVENANTS
So long as any of the Obligations is outstanding and unpaid or the
Borrowers have a right to borrow hereunder (whether or not the conditions to
borrowing have been or can be fulfilled) and unless the Majority Lenders shall
otherwise consent in writing, the Borrowers will furnish or cause to be
furnished to each of the Credit Parties at their respective offices:
Section 7.1 QUARTERLY FINANCIAL STATEMENTS AND INFORMATION. On or
before each applicable Financial Statements Delivery Date, with respect to each
fiscal quarter of the Borrowers, a copy of the unaudited combined balance sheet
of the Borrower Parties as at the end of such quarter, and the related unaudited
combined statements of income, retained earnings and cash flows for the Borrower
Parties, setting forth, in the case of the statements of income, the financial
performance of the MGM Operating Companies by footnote, for such quarter and for
the elapsed portion of the year ended with the last day of such quarter, which
financial statements shall set forth in comparative form such figures for the
same period for the prior fiscal year and shall be certified by an Authorized
Signatory of each of the Borrowers to, in his or her opinion, present fairly, in
accordance with GAAP, the financial position of the Borrower Parties, on a
combined basis, as at the end of such period, and the results of operations for
such period, and for the elapsed portion of the year ended with the last day of
such period, subject only to normal year-end adjustments.
Section 7.2 ANNUAL FINANCIAL STATEMENTS AND INFORMATION;
CERTIFICATE OF NO DEFAULT. On or before each applicable Financial Statements
Delivery Date, with respect to each fiscal year of the Borrowers, a copy of (a)
the audited combined balance sheet, and the related audited combined statements
of income, retained earnings and cash flows, of the Borrower Parties as at the
end of the fiscal year then ended, and (ii) the unaudited combining balance
sheet, and the related unaudited combining statements of income, retained
earnings and cash flows, of the Borrower Parties as at the end of the fiscal
year then ended, which financial statements shall set forth in comparative form
such figures for the same period for the prior fiscal year and shall be
accompanied by an
64
opinion of KPMG Peat Marwick or a firm of independent certified public
accountants of recognized standing selected by the Borrowers and satisfactory to
the Majority Lenders, together with a statement of such accountants certifying
that no Default or Event of Default, including, without limitation, any Default
under Sections 8.8, 8.9 and 8.10 hereof, was detected during the examination of
the Borrower Parties and that such accountants have authorized the Borrowers to
deliver such financial statements and opinion thereon to the Credit Parties
pursuant to this Agreement.
Section 7.3 PERFORMANCE CERTIFICATES. Together with the delivery of
the financial statements pursuant to Section 7.1 hereof, a certificate of an
Authorized Signatory of each the Borrowers, in substantially the form of EXHIBIT
S attached hereto:
(a) setting forth as at the end of such quarter or year,
as the case may be, the arithmetical calculations required to establish whether
or not the Borrowers were in compliance with the requirements of the Financial
Covenants;
(b) stating that, to the best of his or her knowledge, no
Default or Event of Default has occurred as at the end of such quarter or year,
as the case may be, or, if a Default or an Event of Default has occurred,
disclosing each such Default or Event of Default and its nature, when it
occurred, whether it is continuing, and the steps being taken by the Borrowers
with respect to such Default or Event of Default;
(c) setting forth a list updating the information set forth
on SCHEDULE 5.1(c) with respect to the Borrower Parties to the extent that
either of the Borrowers shall have formed or acquired any new Subsidiaries or
designated any new MGM Operating Companies during such quarter;
(d) setting forth a list and description of all Restricted
Payments and Restricted Purchases made by any of the Borrower Parties during
such quarter; and
(e) setting forth a list and description of, together with
applicable financial statements, if available, for any Acquisition, formation or
designation of any new MGM Operating Company during the period for which such
performance certificate is being given.
Section 7.4 COPIES OF OTHER REPORTS.
(a) Promptly upon receipt thereof, copies of all reports,
if any, submitted to either of the Borrowers by its independent public
accountants regarding any of the Borrower Parties, including, without
limitation, any management report prepared in connection with the annual audit
referred to in Section 7.2 hereof.
(b) Within sixty (60) days after the end of each fiscal
year of the Borrowers, the annual budget for the Borrower Parties for the
current fiscal year.
65
(c) Promptly after the sending thereof, copies of all
material statements, reports and other financial information relating to the
Borrower Parties that is sent to any of the RMG Partners or the MGM Partner or
any of the shareholders of RMHI or CSC.
(d) Promptly after the preparation of the same, copies of
all material reports or financial information filed with any governmental
agency, department, bureau, division or other governmental authority or
regulatory body, or evidencing facts or containing information which could have
a Materially Adverse Effect.
(e) From time to time and promptly upon each request, such
data, certificates, reports, statements, documents, or further information
regarding the business, assets, liabilities, financial position, projections or
results of operations of the Borrower Parties as the Arrangers or the Majority
Lenders may reasonably request.
(f) At the time audited financial statements are required
to be provided under Section 7.2 hereof, summary information of the type set
forth in SCHEDULE 5.1(q) with respect to each Material MSO Agreement and each
Material Film Rights Agreement then in effect to which any of the Borrower
Parties is a party (noting any such Material MSO Agreements or Material Film
Rights Agreements that have been either added or deleted with respect to the
prior year).
(g) At the time audited financial statements are required
to be provided under Section 7.2 hereof, a written summary detailing any changes
with respect to the relative ownership interests held by the RMG Partners and
the MGM Partner in each of the Borrowers.
Section 7.5 NOTICE OF LITIGATION AND OTHER MATTERS. Prompt notice
of the following events as to which either Borrower has received notice or
otherwise become aware thereof:
(a) The commencement of all material proceedings and
investigations by or before any governmental body and all actions and
proceedings in any court or before any arbitrator (i) against or, (ii) to the
extent known to either Borrower, in any other way relating adversely and
directly to any of the Borrower Parties, or any of their respective properties,
assets or businesses, or which calls into question the validity of this
Agreement or any other Loan Document, except where the adverse outcome of such
proceeding or investigation is not likely to have a Materially Adverse Effect;
(b) The commencement of any proceeding by or before any
governmental body and all actions and proceedings in any court or before any
arbitrator with respect to the ownership or use of "American Movie Classics";
(c) Any notice of termination, partial termination or
expiration of any MSO Agreement which results in a reduction of fifteen percent
(15%) or more of
66
the number of Paying Affiliated Basic Subscribers of the Borrower Parties in the
aggregate during any calendar quarter when added to all other terminations or
expirations during such quarter;
(d) Any material adverse change with respect to the
business, assets, liabilities, financial position, or results of operations of
any of the Borrower Parties, other than changes in the ordinary course of
business which have not had and are not likely to have a Materially Adverse
Effect;
(e) Any Default or Event of Default, or any default by any
of the Borrower Parties under any agreement (other than this Agreement) to which
any of the Borrower Parties is party or by which any of their respective
properties is bound, or the occurrence of any other event which could have a
Materially Adverse Effect, giving in each case the details thereof and
specifying the action proposed to be taken with respect thereto; and
(f) The occurrence of any Reportable Event or "prohibited
transaction" (as such term is defined in Section 406 of ERISA or Section 4975 of
the Code) which is not statutorily or administratively exempt under Sections 407
or 408 of ERISA or Section 4975 of the Code with respect to any Plan of any of
the Borrower Parties or any of their respective ERISA Affiliates or the
institution or threatened institution by the PBGC of proceedings under Section
4042 of ERISA to terminate or to partially terminate any such Plan or the
commencement or, to either Borrower's knowledge, threatened commencement of any
litigation regarding any such Plan or naming it or the trustee of any such Plan
with respect to such Plan.
ARTICLE 8 - NEGATIVE COVENANTS
So long as any of the Obligations is outstanding and unpaid or the
Borrowers have a right to borrow hereunder (whether or not the conditions to
borrowing have been or can be fulfilled) and unless the Majority Lenders shall
otherwise give their prior consent in writing:
Section 8.1 INDEBTEDNESS. Neither of the Borrowers shall, nor
permit any of the Guarantors to, create, assume, incur or otherwise become or
remain obligated in respect of, or permit to be outstanding any Indebtedness
except:
(a) Indebtedness under this Agreement, the Notes and the
other Loan Documents (including, without limitation, any Incremental Facility
Indebtedness);
(b) accounts payable, accrued expenses, customer advance
payments and other current liabilities (other than Indebtedness For Money
Borrowed) incurred in the ordinary course of business;
67
(c) Capitalized Lease Obligations of the Borrower Parties
in an aggregate amount over the remainder of the term of such obligations not to
exceed $30,000,000 at any one time outstanding;
(d) intercompany Indebtedness among any of the Borrower
Parties; and
(e) any Accrued Tax Liabilities and any Subordinated Tax
Liabilities.
Section 8.2 INVESTMENTS. Neither of the Borrowers shall, nor permit
any of the Guarantors to, make any Investment, except that:
(a) the Borrowers may purchase or otherwise acquire and own
Cash Equivalents;
(b) the Borrower Parties may make Investments in any of the
other Borrower Parties; and
(c) so long as no Default or Event of Default then exists
or would be caused thereby and subject to compliance with Section 6.14 hereof,
the Borrower Parties may (i) make cash Investments in an aggregate amount not to
exceed, together with the amount of any Acquisitions made during such year under
Section 8.5(c)(v)(A) hereof, the Available Basket Amount, (ii) make cash
Investments funded by Net Cash Proceeds received in connection with the issuance
of any New Affiliated Equity to the extent such Net Cash Proceeds are not used
by the Borrower Parties for any other purpose, and (iii) make Investments solely
in exchange for RMG Tracking Stock or Cablevision-NY Group Stock.
Section 8.3 LIMITATION ON LIENS. Neither of the Borrowers shall,
nor permit any of the Guarantors to, create, assume, incur or permit to exist or
to be created, assumed, incurred or permitted to exist, directly or indirectly,
any Lien on any of its properties or assets, whether now owned or hereafter
acquired, except for Permitted Liens. Except for the agreement set forth in the
foregoing sentence, none of the Borrower Parties shall agree with any other
Person not to xxxxx x Xxxx on any material portion of their respective assets to
secure Indebtedness.
Section 8.4 AMENDMENT AND WAIVER. Neither of the Borrowers shall
enter into any amendment, or agree to or accept any waiver, which would
materially adversely affect the rights of the Borrowers and the Credit Parties,
or any of them, of any of the provisions of, (a) its Constituent Documents
(including, without limitation, any amendment which would effectively accelerate
the exercise of MGM's put right thereunder or limit the option of RMHI and the
RMG Partners to satisfy such put right, in their sole discretion, with shares of
RMG Tracking Stock or shares of Cablevision-NY
68
Group Stock), (b) the Constituent Documents of any of the Guarantors, (c) the
Consulting Agreement, (d) the Services Agreement or (e) the Tax Sharing Policy.
Section 8.5 LIQUIDATION; DISPOSITION OR ACQUISITION OF ASSETS.
(a) Neither of the Borrowers shall, nor permit any of the
Guarantors to, at any time, (i) liquidate or dissolve itself (or suffer any
liquidation or dissolution) or otherwise wind up, or (ii) sell, lease, abandon,
transfer, exchange or otherwise dispose of any assets (including, without
limitation, any capital stock, partnership interests or other equity interests)
or business in excess of $5,000,000 in the aggregate during the term of this
Agreement, or (iii) enter into any merger or consolidation, except, in each
case, for (x) sales, dispositions, mergers, consolidations or exchanges by any
Guarantor of its businesses, assets or rights to or with any other Borrower
Party and (y) sales or dispositions in the ordinary course of business by any of
the Borrower Parties of obsolete or worn-out property or other property
reasonably determined by the management of the disposing Company to be not used
or useful in its business.
(b) Neither of the Borrowers shall, nor permit any of the
Guarantors to, at any time, issue any capital stock, partnership interests or
other equity interests in any of the Borrower Parties, except, so long as no
Default or Event of Default then exist or would be caused thereby, for the
issuance of additional partnership interests in either of the Borrowers in
connection with the issuance of any New Affiliated Equity.
(c) Neither of Borrowers shall, nor permit any of the
Guarantors to, at any time, acquire assets, property, stock or the business of
any other Person except for (i) Capital Expenditures in the ordinary course of
such Borrower Party's business, (ii) purchases of assets in the ordinary course
of such Borrower Party's business, (iii) Film Rights Agreements, (iv) Permitted
Investments and (v) so long as no Default or Event of Default then exists or
would be caused thereby and subject to compliance with Section 6.14 hereof, (A)
Acquisitions consummated solely in exchange for RMG Tracking Stock or
Cablevision-NY Group Stock, (B) Acquisitions in an aggregate amount not to
exceed, together with the amount of any Investments made under Section 8.2(c)(i)
hereof, the Available Basket Amount, and (C) Acquisitions funded by Net Cash
Proceeds received in connection with the issuance of any New Affiliated Equity
to the extent such Net Cash Proceeds are not used by the Borrower Parties for
any other purpose.
Section 8.6 LIMITATION ON GUARANTIES. Neither of the Borrowers
shall, nor permit any of the Guarantors to, at any time Guaranty, or assume, be
obligated with respect to, or permit to be outstanding any Guaranty of, any
obligation of any other Person other than (a) under any Loan Document, (b)
obligations under agreements to indemnify Persons who have issued bid or
performance bonds or letters of credit issued in lieu of such bonds in the
ordinary course of business of such Borrower Party securing performance by any
Borrower Party of activities otherwise permissible hereunder, (c) a
69
guaranty by endorsement of negotiable instruments for collection in the ordinary
course of business, and (d) those Guaranties described on SCHEDULE 8.6 attached
hereto (as such schedule may be amended by the Borrowers from time to time),
undertaken in the ordinary course of business of the Borrower Parties,
including, without limitation, Guaranties issued for purposes of securing (i)
programming or transponder rights, (ii) production, sports team and product
related arrangements, (iii) affiliation agreements, (iv) advertising
representation agreements, marketing and service arrangements, or (v) real
estate leases, and extensions, replacements and modifications of the foregoing
PROVIDED that the aggregate amount of all such Guaranties under this subsection
8.6(d) at any time outstanding does not exceed $20,000,000.
Section 8.7 RESTRICTED PAYMENTS AND PURCHASES. Neither of the
Borrowers shall, nor permit any of the Guarantors to, directly or indirectly,
declare or make any Restricted Payment or Restricted Purchase, except that (a)
the Guarantors may make Restricted Payments to the Borrowers, (b) the Borrower
may make payments in respect of Employee Stock Incentive Expense, and (c) so
long as no Default or Event of Default then exists or would be caused thereby,
the Borrowers may (i) make Restricted Payments, subject to the terms of the
Subordination of Fees Agreement, for payment of fees under the Consulting
Agreement and for reimbursement of services to the extent set forth in the
Services Agreement, (ii) make Restricted Payments to the RMG Partners and the
MGM Partners in accordance with their pro rata share of the partnership
interests in the Borrowers, and (iii) pay to RMG, RMHI or CSC amounts due in
respect of Accrued Tax Liabilities pursuant to, and in accordance with, the Tax
Sharing Policy.
Section 8.8 LEVERAGE RATIO. The Borrowers shall not permit, (a) as
of the end of any fiscal quarter or (b) as of the date of any Advance increasing
the Obligations hereunder, the Leverage Ratio (after giving effect to such
Advance, if applicable), to exceed 2.00 to 1.00.
Section 8.9 INTEREST COVERAGE RATIO. The Borrowers shall not
permit, as of the end of any fiscal quarter ending during the term of this
Agreement, the Interest Coverage Ratio to be less than 3.50 to 1.00.
Section 8.10 DEBT SERVICE RATIO. The Borrowers shall not permit, as
of the end of any fiscal quarter ending during the term of this Agreement, the
Debt Service Ratio to be less than 2.00 to 1.00.
Section 8.11 AFFILIATE TRANSACTIONS. Neither of the Borrowers shall,
nor permit any of the Guarantors to, at any time engage in any transaction with
an Affiliate, or make an assignment or other transfer of any of its assets to
any Affiliate, on terms less advantageous to such Borrower Party than would be
the case if such transaction had been effected with a non-Affiliate, in each
case other than as set forth on SCHEDULE 8.11 attached hereto or as otherwise
permitted under this Agreement.
70
Section 8.12 REAL ESTATE. None of the Borrower Parties shall
purchase, or become obligated to purchase, real estate in an amount in excess of
$10,000,000 in the aggregate during the term of this Agreement.
Section 8.13 ERISA LIABILITIES. Neither of the Borrowers shall fail,
nor permit any of the Guarantors to, to make all material contributions in
accordance with the terms of their respective Plans and to meet all of the
applicable minimum funding requirements of ERISA and the Code, and, to the
extent that the assets of such Plans would be less than an amount sufficient to
provide all accrued benefits payable under such Plans determined on an ongoing
basis, shall make the maximum deductible contributions allowable under the Code.
None of the Borrower Parties shall incur any material withdrawal liability with
respect to any Multiemployer Plan. None of the Borrower Parties shall make any
commitment to provide post-employment health or life insurance benefits, except
as required by Section 601 through 609 of ERISA, Section 4980(B) of the Code and
applicable state law, nor terminate any Plan if its termination would reasonably
be expected to have a Materially Adverse Effect.
Section 8.14 SALES AND LEASEBACKS. None of the Borrower Parties will
enter into any arrangement, directly or indirectly, with any Person whereby any
Borrower Party shall sell or transfer any property, real or personal, whether
now owned or hereafter acquired, and whereby any Borrower Party shall then or
thereafter rent or lease as lessee such property or any part thereof or other
property which any Borrower Party intends to use for substantially the same
purpose or purposes as the property sold or transferred, unless in each case,
the sale or transfer of such property is permitted by Section 8.5 hereof.
Section 8.15 NEGATIVE PLEDGE. Neither of the Borrowers shall, nor
permit any of the Guarantors to, directly or indirectly, enter into any
agreement (other than the Loan Documents) with any Person that prohibits or
restricts or limits the ability of any Borrower Party to create, incur, pledge
or suffer to exist any Lien upon any of its respective assets, or restricts the
ability of any Guarantor to make Restricted Payments to its parent Company.
ARTICLE 9 - DEFAULT
Section 9.1 EVENTS OF DEFAULT. Each of the following shall
constitute an Event of Default, whatever the reason for such event and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment or order of any court or any order, rule, or regulation
of any governmental or non-governmental body:
(a) Any representation or warranty made under this
Agreement shall prove incorrect or misleading in any material respect when made
or deemed to have been made;
71
(b) The Borrowers shall default (i) in the payment of any
interest and fees payable hereunder or under the Notes or the Incremental
Facility Notes, or under the other Loan Documents and such Default shall not
have been cured by payment of such overdue amounts in full within five (5) days
from the date such payment became due, or (ii) in the payment of any principal
when due hereunder or under the Notes or the Incremental Facility Notes;
(c) Any of the Borrower Parties shall default in the
performance or observance of any agreement or covenant contained in Article 8;
(d) There shall occur any Default in the performance or
observance of any agreement or covenant or breach of any representation or
warranty contained in any of the Loan Documents (other than this Agreement or as
otherwise provided in Section 9.1 of this Agreement), which shall not be cured
to the Majority Lenders' satisfaction within the applicable cure period, if any,
provided for in such Loan Document;
(e) Any of the Borrower Parties shall default in the
performance or observance of any other agreement or covenant contained in this
Agreement not specifically referred to elsewhere in this Section 9.1, and such
Default shall not be cured to the Majority Lenders' satisfaction within a period
of thirty (30) days from the occurrence of such default;
(f) The RMG Partners shall, at any time, cease to own and
vote, directly or indirectly, at least eighty percent (80%) of the partnership
interests of each of the Borrowers, or the Managing Partners shall, at any time,
cease to have management control over the business and operations of the
Borrower Parties, or any Person other than RMHI, the RMG Partners or a direct or
wholly-owned Subsidiary of the RMG Partners shall obtain the legal or
contractual right to own, or to cause the transfer of the ownership of, all or
any portion of the eighty percent (80%) of the partnership interests of each of
the Borrowers held by the RMG Partners on the Agreement Date, without regard to
any required approval of any other Person;
(g) Either of the Borrowers shall, at any time, cease to
own and vote directly or indirectly one hundred percent (100%) of the capital
stock, partnership interests or other equity interests of each of its
Subsidiaries (except to the extent that (i) the capital stock, partnership
interests or other equity interests of any such Subsidiary are permitted to be
disposed of and (ii) any such Subsidiary is permitted to issue any additional
capital stock, partnership interests or other equity interests, in each case,
pursuant to the terms and conditions of this Agreement);
(h) Subject to subsection (i) below, the aggregate number
of Paying Affiliated Basic Subscribers of the Borrower Parties shall at any time
be less than seventy-five percent (75%) of the aggregate number of such Paying
Affiliated Basic Subscribers as of March 31, 2002 if such loss of Paying Basic
Affiliated Subscribers
72
would have a Materially Adverse Effect and if such loss of Paying Affiliated
Basic Subsidiaries is not cured by the creation of new Paying Affiliated Basic
Subscribers of the Borrower Parties within sixty (60) days after the occurrence
thereof;
(i) The aggregate number of Paying Affiliated Basic
Subscribers of the Borrower Parties shall at any time be less than seventy
percent (70%) of the aggregate number of such Paying Affiliated Basic
Subscribers as of March 31, 2002 if such loss of Paying Affiliated Basic
Subscribers would have a Materially Adverse Effect;
(j) There shall be entered a decree or order for relief in
respect of any of the RMG Partners or any of the Borrower Parties under the
Bankruptcy Code, or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator, or similar official of any of the RMG Partners or any
of the Borrower Parties, or of any substantial part of their respective
properties, or ordering the winding-up or liquidation of the affairs of any of
the RMG Partners or any of the Borrower Parties, or an involuntary petition
shall be filed against any of the RMG Partners or any of the Borrower Parties
and a temporary stay entered, and (i) such petition and stay shall not be
diligently contested, or (ii) any such petition and stay shall continue
undismissed for a period of thirty (30) consecutive days;
(k) Any of the RMG Partners or any of the Borrower Parties
shall file a petition, answer, or consent seeking relief under the Bankruptcy
Code, or any of the RMG Partners or any of the Borrower Parties shall consent to
the institution of proceedings thereunder or to the filing of any such petition
or to the appointment or taking of possession of a receiver, liquidator,
assignee, trustee, custodian, sequestrator, or other similar official of any of
the RMG Partners or any of the Borrower Parties, or of any substantial part of
their respective properties, or any of the RMG Partners or any of the Borrower
Parties shall fail generally to pay their respective debts as they become due,
or any of the RMG Partners or any of the Borrower Parties shall take any action
in furtherance of any such action;
(l) A final judgment shall be entered by any court against
any of the Borrower Parties for the payment of money which exceeds $5,000,000,
or a warrant of attachment or execution or similar process shall be issued or
levied against property of any of the Borrower Parties which, together with all
other property of the Borrower Parties subject to other such process, exceeds in
value $5,000,000 in the aggregate, and if, within thirty (30) days after the
entry, issue, or levy thereof, such judgment, warrant, or process shall not have
been paid or discharged or stayed pending appeal, or if, after the expiration of
any such stay, such judgment, warrant, or process shall not have been paid or
discharged;
(m) There shall be at any time (i) any "accumulated funding
deficiency" (as defined in Section 302 of ERISA or in Section 412 of the Code)
with respect to any Plan maintained by any of the Borrower Parties, or to which
any of the
73
Borrower Parties, has any material liabilities, or any trust created thereunder,
or (ii) a trustee appointed by a United States District Court to administer any
such Plan under Section 4042 of ERISA, or (iii) proceedings instituted by the
PBGC to terminate any such Plan under Section 4042 of ERISA, or (iv) incurred by
any of the Borrower Parties any liability to the PBGC in connection with the
distress termination of any such Plan under Section 4041(c) of ERISA; or any
fiduciary of, or party in interest to, any Plan or trust created under any Plan
of any of the Borrower Parties shall engage in a "prohibited transaction" (as
such term is defined in Section 406 of ERISA or Section 4975 of the Code) which
would subject any of the Borrower Parties to a tax on "prohibited transactions"
imposed by Section 4975 of the Code, or (v) any fiduciary of, or party in
interest to, any Plan or trust created under any Plan of any of the Borrower
Parties shall engage in a breach of fiduciary responsibility or knowingly
participate in any violation of ERISA; or any Plan of any of the Borrower
Parties which is intended to qualify under Section 401(a) of the Code shall have
its application for or a favorable IRS determination with respect to the
qualification requirements under such section of the Code denied by the IRS, or
have the IRS revoke its previously issued determination; and in each case, such
event or condition, together with other such events or conditions, if any, would
subject the Borrower Parties to any tax, liability or penalty in excess of
$5,000,000 in the aggregate;
(n) There shall occur any default under any material
indenture, agreement, or instrument evidencing Indebtedness For Money Borrowed
of any of the Borrower Parties;
(o) All or any portion of any Loan Document shall at any
time and for any reason be declared to be null and void by a court of competent
jurisdiction in a suit with respect to such Loan Document or otherwise
unenforceable, or a proceeding shall be commenced by any governmental authority
having jurisdiction over any of the Borrower Parties in either case, involving a
legitimate dispute or a proceeding shall be commenced by any of the Borrower
Parties, seeking to establish the invalidity or unenforceability of any Loan
Documents (exclusive of questions of interpretation of any provision thereof),
or any of the Borrower Parties shall deny that it has any liability or
obligation for the payment of principal or interest purported to be created
under any Loan Document;
(p) There shall occur a default by any of the Borrower
Parties (if such default is not cured or waived within any applicable grace
period) under any Material MSO Agreement, which default would have a Materially
Adverse Effect; or
(q) There shall exist any default under, or any
cancellation of (without a contemporaneous replacement, or if interim substitute
arrangements have been made with respect thereto, replacement within forty-five
(45) days, of), any Transponder Lease Agreement if such default is not cured
within any applicable cure period and if such default or cancellation, as
applicable, would have a Materially Adverse Effect.
74
Section 9.2 REMEDIES. If an Event of Default shall have occurred
and shall be continuing:
(a) With the exception of an Event of Default specified in
Sections 9.1(j) or (k) hereof, the Administrative Agent, at the direction of the
Majority Lenders, shall (i) terminate the Revolving Loan Commitment and any
obligations of the Swing Loan Lender to advance the Swing Loan Committed Amount
hereunder and (ii) declare the principal of and interest on the Loans and the
Notes and all other obligations to be forthwith due and payable without
presentment, demand, protest, or notice of any kind, all of which are hereby
expressly waived, anything in this Agreement or in the Notes to the contrary
notwithstanding, or both.
(b) Upon the occurrence and continuance of an Event of
Default specified in Sections 9.1(j) or (k) hereof, such principal, interest,
and other obligations shall thereupon and concurrently therewith become due and
payable, and the Revolving Loan Commitment shall forthwith terminate and any
obligations of the Swing Loan Lender to advance the Swing Loan Committed Amount
shall forthwith terminate, all without any action by the Credit Parties or the
Majority Lenders or the holders of the Notes and without presentment, demand,
protest, or other notice of any kind, all of which are expressly waived,
anything in this Agreement or in the Notes to the contrary notwithstanding.
(c) The Arrangers and the Administrative Agent, with the
concurrence of the Majority Lenders, shall exercise all of the post-default
rights granted to it and to them under the Loan Documents or under Applicable
Law.
(d) The rights and remedies of the Arrangers and the
Administrative Agent and the Lenders hereunder shall be cumulative, and not
exclusive.
ARTICLE 10 - THE AGENTS
Section 10.1 APPOINTMENT AND AUTHORIZATION. Each Lender hereby
irrevocably appoints and authorizes, and hereby agrees that it will require any
transferee of any of its interest in its Loan and in its Notes irrevocably to
appoint and authorize, each of the Agents to take such actions as its agent on
its behalf and to exercise such powers hereunder and under the Security
Documents as are delegated by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto and as may be provided by any Loan
Document. Any action taken by any of the Agents under this Agreement or any Loan
Document shall be taken for itself and for the ratable benefit of each of the
other Credit Parties, except as may be otherwise expressly provided in this
Agreement or in any other Loan Document. None of the Agents nor any of their
respective Lender Affiliates, directors, officers, employees, or agents shall be
liable for any action taken or omitted to be taken by any of them hereunder or
in connection herewith, except for its or their own gross negligence or willful
misconduct. The
75
Syndication Agent and the co-Documentation Agents shall have no obligations
under this Agreement in such capacities.
Section 10.2 DELEGATION OF DUTIES. The Agents may execute any of
their respective duties under the Loan Documents by or through agents or
attorneys selected by them, respectively, using reasonable care and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
None of the Agents shall be responsible to any of the Lenders for the negligence
or misconduct of any agents or attorneys selected by any of them, respectively,
with reasonable care.
Section 10.3 INTEREST HOLDERS. The Agents may treat each Lender, or
the Person designated in the last notice filed with the Administrative Agent
under this Section 10.3, as the holder of all of the interests of such Lender in
its Loans and in its Notes until written notice of transfer, signed by such
Lender (or the Person designated in the last notice filed with the
Administrative Agent) and by the Person designated in such written notice of
transfer, in form and substance satisfactory to the Administrative Agent, shall
have been filed with the Administrative Agent.
Section 10.4 CONSULTATION WITH COUNSEL. Each of the Agents may
consult with legal counsel selected by it and shall not be liable for any action
taken or suffered by it in good faith in reliance thereon.
Section 10.5 DOCUMENTS. None of the Agents shall be under any duty
to examine, inquire into, or pass upon the validity, effectiveness, or
genuineness of this Agreement, any Note, or any instrument, document, or
communication furnished pursuant hereto or in connection herewith, and each of
the Agents shall be entitled to assume that they are valid, effective, and
genuine, have been signed or sent by the proper parties, and are what they
purport to be.
Section 10.6 SECURITY DOCUMENTS. The Administrative Agent, as
administrative agent hereunder and under the Security Documents, is hereby
authorized to act on behalf of the Credit Parties, in its own capacity and
through other agents and sub-agents appointed by it with due care, under the
Security Documents and to file UCC-1 financing statement forms in connection
therewith, provided that, unless otherwise expressly provided in this Agreement,
the Administrative Agent shall not agree to the release of any Collateral except
in compliance with Section 12.12 hereof. In connection with its role as secured
party with respect to the Collateral hereunder, the Administrative Agent shall
act as administrative agent, for itself and for the benefit of the Credit
Parties, and such role as administrative agent shall be disclosed on all
appropriate accounts, certificates, filings, mortgages, and other collateral
documentation.
Section 10.7 ARRANGERS AND AFFILIATES. With respect to the Revolving
Loan Commitment and the Loans, any Lender which is a Lender Affiliate of any
Agent shall have the same rights and powers hereunder as any other Lender, and
each Agent and its respective Lender Affiliates may accept deposits from, lend
money to, and generally
76
engage in any kind of business with either Borrower or any Lender Affiliates of,
or Persons doing business with, either Borrower, as if it were not affiliated
with such Agent and without any obligation to account therefor.
Section 10.8 RESPONSIBILITY OF THE AGENTS. The duties and
obligations of the Agents under this Agreement are only those expressly set
forth in this Agreement. Each of the Agents shall be entitled to assume that no
Default or Event of Default has occurred and is continuing unless it has actual
knowledge, or has been notified by the Borrowers, of such fact, or has been
notified by a Lender that such Lender considers that a Default or an Event of
Default has occurred and is continuing, and such Lender shall specify in detail
the nature thereof in writing. None of the Agents shall be liable to any of the
Lenders hereunder for any action taken or omitted to be taken except for its own
gross negligence or willful misconduct. The Administrative Agent shall provide
each Lender with copies of such documents received from the Borrowers as such
Lender may reasonably request.
Section 10.9 ACTION BY AGENTS.
(a) Except for action requiring the approval of the
Majority Lenders, the Super-Majority Lenders or all of the Lenders, as the case
may be, each Agent shall be entitled to use its discretion with respect to
exercising or refraining from exercising any rights which may be vested in it
by, and with respect to taking or refraining from taking any action or actions
which it may be able to take under or in respect of, this Agreement, unless such
Agent shall have been instructed by the Majority Lenders, the Super-Majority
Lenders or all the Lenders, as the case may be, to exercise or refrain from
exercising such rights or to take or refrain from taking such action, provided
that such Agent shall not exercise any rights under Section 9.2(a) of this
Agreement without the request of the Majority Lenders. None of the Agents shall
incur any liability under or in respect of this Agreement with respect to
anything which it may do or refrain from doing in the reasonable exercise of its
judgment or which may seem to it to be necessary or desirable in the
circumstances, except for its own gross negligence or willful misconduct.
(b) None of the Agents shall be liable to the Lenders, or
any of them, in acting or refraining from acting under this Agreement in
accordance with the instructions of the Majority Lenders, the Super-Majority
Lenders or all the Lenders, as the case may be, and any action taken or failure
to act pursuant to such instructions shall be binding on all Lenders.
Section 10.10 NOTICE OF DEFAULT OR EVENT OF DEFAULT. In the event
that any of the Credit Parties shall acquire actual knowledge, or shall have
been notified in writing, of any Default or Event of Default, such Credit Party
shall promptly notify the other Credit Parties, and each Agent shall take such
action and assert such rights under this Agreement as the Majority Lenders shall
request in writing, and none of the Agents shall be subject to any liability by
reason of its acting pursuant to any such request. If the
77
Majority Lenders shall fail to request an Agent to take action or to assert
rights under this Agreement in respect of any Default or Event of Default within
ten (10) days after their receipt of the notice of any Default or Event of
Default from any Credit Party, or shall request inconsistent action with respect
to such Default or Event of Default, such Agent may, but shall not be required
to, take such action and assert such rights (other than rights under Article 9
hereof) as it deems in its discretion to be advisable for the protection of the
Lenders, except that, if the Majority Lenders have instructed such Agent not to
take such action or assert such right, in no event shall such Agent act contrary
to such instructions.
Section 10.11 RESPONSIBILITY DISCLAIMED. None of the Agents shall be
under any liability or responsibility whatsoever as such:
(a) To either Borrower or any other Person or entity as a
consequence of any failure or delay in performance by or any breach by, any
Lender or Lenders of any of its or their obligations under this Agreement;
(b) To any Lender or Lenders, as a consequence of any
failure or delay in performance by, or any breach by, either Borrower or any
other obligor of any of its obligations under this Agreement or the Notes or any
of the other Loan Documents; or
(c) To any Lender or Lenders for any statements,
representations, or warranties in this Agreement, or any other document
contemplated by this Agreement or any information provided pursuant to this
Agreement, any of the other Loan Documents, or any other document contemplated
by this Agreement, or for the validity, effectiveness, enforceability, or
sufficiency of this Agreement, the Notes, any of the other Loan Documents, or
any other document contemplated by this Agreement.
Section 10.12 INDEMNIFICATION. Each of the Lenders agrees to
indemnify each of the Agents in their respective capacities as such (to the
extent not reimbursed by the Borrowers and without limiting the obligation of
the Borrowers to do so) pro rata according to their respective Commitment
Percentages, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses (including fees
and expenses of experts, agents, consultants and counsel), or disbursements of
any kind or nature whatsoever which may be imposed on, incurred by, or asserted
against such Agent in any way relating to or arising out of this Agreement, any
of the other Loan Documents, or any other document contemplated by this
Agreement or any action taken or omitted by such Agent under this Agreement, any
of the other Loan Documents, or any other document contemplated by this
Agreement, except that no Lender shall be liable to such Agent for any portion
of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses, or disbursements resulting from the gross
negligence or willful misconduct of such Agent.
78
Section 10.13 CREDIT DECISION. Each Lender represents and warrants to
each other and to each Agent that:
(a) In making its decision to enter into this Agreement
and to make Advances, it has independently taken whatever steps it considers
necessary to evaluate the financial condition and affairs of the Borrowers and
that it has made an independent credit judgment, and that it has not relied upon
information provided by any Agent; and
(b) So long as any portion of the Loans remains
outstanding, it will continue to make its own independent evaluation of the
financial condition and affairs of the Borrowers.
Section 10.14 SUCCESSOR AGENTS. Subject to the appointment and
acceptance of a successor Agent (which shall be any Lender or a commercial
lender organized under the laws of the United States of America or any political
subdivision thereof which has a combined capital and reserves in excess of
$250,000,000) as provided below, any Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrowers and may be removed at
any time for cause by the Majority Lenders. Upon any such resignation or
removal, the Majority Lenders shall have the right to appoint, subject to such
Lender's consent in its sole discretion, a successor Agent from among the
Lenders or the Lender Affiliates. If no successor Agent shall have been so
appointed by the Majority Lenders, and shall have accepted such appointment
within thirty (30) days after the retiring Agent's giving of notice of
resignation or the Majority Lenders' removal of the retiring Agent, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent which
shall be any Lender or a Lender Affiliates or a commercial bank organized under
the laws of the United States of America or any political subdivision thereof
which has combined capital and reserves in excess of $250,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges, duties, and obligations of the retiring Agent, and
the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation or removal hereunder as Agent,
the provisions of this Section 10.14 shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
an Agent.
ARTICLE 11 - CHANGE IN CIRCUMSTANCES
AFFECTING EURODOLLAR ADVANCES
Section 11.1 EURODOLLAR BASIS DETERMINATION INADEQUATE OR UNFAIR.
Notwithstanding anything contained herein which may be construed to the
contrary, if with respect to any proposed Eurodollar Advance for any Eurodollar
Advance Period, the Administrative Agent determines after consultation with the
Lenders that deposits in Dollars (in the applicable amount) are not being
offered to each of the Lenders in the relevant market for such Eurodollar
Advance Period, the Administrative Agent shall
79
forthwith give notice thereof to the Borrowers and the Lenders, whereupon until
the Administrative Agent notifies the Borrowers that the circumstances giving
rise to such situation no longer exist, the obligations of the Lenders to make
Eurodollar Advances shall be suspended.
Section 11.2 ILLEGALITY. If any Applicable Law, or any change
therein, or any interpretation or change in interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Lender
with any request or directive (whether or not having the force of law) of any
such governmental authority, central bank or comparable agency, shall make it
unlawful or impossible for any Lender to make, maintain or fund its Eurodollar
Advances, such Lender shall so notify the Administrative Agent, and the
Administrative Agent shall forthwith give notice thereof to the other Lenders
and the Borrowers. Before giving any notice to the Administrative Agent pursuant
to this Section 11.2, such Lender shall designate a different lending office if
such designation will avoid the need for giving such notice and will not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender. Upon
receipt of such notice, notwithstanding anything contained in Article 2 hereof,
the Borrowers shall, jointly and severally, repay in full the then outstanding
principal amount of each Eurodollar Advance of such Lender so affected, together
with accrued interest thereon, either (a) on the last day of the then current
Eurodollar Advance Period applicable to such Advance if such Lender may lawfully
continue to maintain and fund such Eurodollar Advance to such day or (b)
immediately if such Lender may not lawfully continue to fund and maintain such
Eurodollar Advance to such day. Concurrently with repaying each Eurodollar
Advance of such Lender, notwithstanding anything contained in Article 2 or
Article 4 hereof, the Borrowers shall borrow a Base Rate Advance from such
Lender, and such Lender shall make such Base Rate Advance in an amount such that
the outstanding principal amount of the Note held by such Lender shall equal the
outstanding principal amount of such Note immediately prior to such repayment.
Section 11.3 INCREASED COSTS AND TAXES.
(a) If any Regulatory Change:
(i) Shall subject any Lender to any tax, duty or
other charge with respect to its obligation to make Eurodollar Advances, or its
Eurodollar Advances, or shall change the basis of taxation of payments to any
Lender of the principal of or interest on its Eurodollar Advances or in respect
of any other amounts due under this Agreement in respect of its Eurodollar
Advances or its obligation to make Eurodollar Advances (except for changes in
the rate of tax on the overall net income of such Lender imposed by the
jurisdiction in which such Lender's principal executive office is located); or
(ii) Shall impose, modify, or deem applicable any
reserve (including, without limitation, any imposed by the Board of Governors of
the
80
Federal Reserve System, but excluding any included in an applicable Eurodollar
Reserve Percentage), special deposit, assessment or other requirement or
condition against assets of, deposits with or for the account of, or commitments
or credit extended by any Lender, or shall impose on any Lender or the
eurodollar interbank borrowing market any other condition affecting such
Lender's obligation to make such Eurodollar Advances or its Eurodollar Advances;
and the result of any of the foregoing is to increase the cost to such
Lender of making, converting into, continuing or maintaining any such Eurodollar
Advances, or to reduce the amount of any sum received or receivable by such
Lender under this Agreement or under its Notes with respect thereto, then, in
any such case, on the earlier of demand by such Lender or the Maturity Date, the
Borrowers, jointly and severally, agree to pay to such Lender such additional
amount or amounts as will compensate such Lender for such increased costs. Each
Lender requesting compensation will promptly notify the Borrowers and the
Administrative Agent of any event of which it has knowledge, occurring after the
date hereof, which will entitle such Lender to compensation pursuant to this
Section 11.3 and will designate a different lending office if such designation
will avoid the need for, or reduce the amount of, such compensation and will
not, in the sole judgment of such Lender, be otherwise disadvantageous to such
Lender.
(b) A certificate of any Lender claiming compensation under
this Section 11.3 and setting forth the additional amount or amounts to be paid
to it hereunder and calculations therefor shall be conclusive in the absence of
manifest error. In determining such amount, such Lender may use any reasonable
averaging and attribution methods. If any Lender demands compensation under this
Section 11.3, the Borrowers may at any time, upon at least five (5) Business
Days prior notice to such Lender, prepay in full the then outstanding Eurodollar
Advances of such Lender, together with accrued interest thereon to the date of
prepayment, along with any reimbursement required under Section 2.11 hereof.
Concurrently with prepaying such Eurodollar Advances, the Borrowers shall borrow
a Base Rate Advance from such Lender, and such Lender shall make such Base Rate
Advance in an amount such that the outstanding principal amount of the Notes
held by such Lender shall equal the outstanding principal amount of such Notes
immediately prior to such prepayment.
Section 11.4 EFFECT ON OTHER ADVANCES. If notice has been given
pursuant to Section 11.1, 11.2 or 11.3 hereof suspending the obligation of any
Lender to make Eurodollar Advances, or requiring Eurodollar Advances of any
Lender to be repaid or prepaid, then, unless and until such Lender notifies the
Borrowers that the circumstances giving rise to such repayment no longer apply,
all Advances which would otherwise be made by such Lender as Eurodollar Rate
Advances shall be made instead as Base Rate Advances.
81
ARTICLE 12 - MISCELLANEOUS
Section 12.1 NOTICES.
(a) Unless otherwise specifically provided herein, all
notices and other communications under this Agreement shall be in writing and
shall be deemed to have been given three (3) days after deposit in the mail,
designated as certified mail, return receipt requested, postage-prepaid, or one
(1) day after being entrusted to a reputable commercial overnight delivery
service, or when sent by telecopy addressed to the party to which such notice is
directed at its address determined as provided in this Section 12.1 All notices
and other communications under this Agreement shall be given to the parties
hereto at the following addresses:
(i) If to the Borrowers, to each of them at:
American Movie Classics Company
Bravo Company
c/o Rainbow Media Group, LLC
000 Xxxxxxx Xxxxxxxxxx
Xxxxxxx, Xxx Xxxx 00000-0000
Attn: President
Telecopy No.: (000) 000-0000
with copies to:
Rainbow Media Group, LLC
000 Xxxxxxx Xxxxxxxxxx
Xxxxxxx, Xxx Xxxx 00000-0000
Attn: General Counsel
Telecopy No.: (000) 000-0000
and
Rainbow Media Group, LLC
000 Xxxxxxx Xxxxxxxxxx
Xxxxxxx, Xxx Xxxx 00000-0000
Attn: Senior Vice President - Finance
Telecopy No.: (000) 000-0000
82
and
Cablevision Systems Corporation
0000 Xxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attn: General Counsel
Telecopy No.: (000) 000-0000
(ii) If to the Administrative Agent, to it at:
Toronto Dominion (Texas), Inc.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Manager, Syndications and Credit
Administration
Telecopy No.: (000) 000-0000
with a copy to:
TD Securities (USA) Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxx Xxxxxxxxx, Managing Director
Telecopy No.: (000) 000-0000
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
000 Xxxxxxxxx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxx, Esq.
Telecopy No.: (000) 000-0000
(iii) If to any Arranger, to each of them at the
addresses set forth for them in SCHEDULE 1 attached hereto and with a copy to:
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
000 Xxxxxxxxx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxx, Esq.
Telecopy No.: (000) 000-0000
(iv) If to the Lenders, to them at the addresses set
forth for them in SCHEDULE 1 attached hereto.
Copies shall be provided to Persons other than parties hereto only in
the case of notices under Article 8 hereof.
83
(b) Any party hereto may change the address to which
notices shall be directed under this Section 12.1 by giving ten (10) days'
written notice of such change to the other parties.
Section 12.2 EXPENSES. The Borrowers, jointly and severally, agree
to promptly pay:
(a) All reasonable out-of-pocket expenses of the Arrangers
and the Administrative Agent on the Agreement Date in connection with the
preparation, negotiation, execution, and delivery of this Agreement and the
other Loan Documents executed on the Agreement Date the transactions
contemplated hereunder and thereunder, and the making of the initial Advance
hereunder, including, but not limited to, the reasonable fees and disbursements
of counsel for the Administrative Agent;
(b) All reasonable out-of-pocket expenses of the Arrangers
and the Administrative Agent in connection with the preparation and negotiation
of any waiver, modification, amendment, or consent by the Lenders relating to
this Agreement or the other Loan Documents whether or not executed, including,
but not limited to, the reasonable fees and disbursements of counsel for the
Administrative Agent;
(c) All reasonable out-of-pocket expenses of the Arrangers
and the Administrative Agent in connection with the syndication of the Loans;
and
(d) From and after the occurrence of an Event of Default,
all reasonable out-of-pocket costs and expenses of the Agents and the Lenders in
respect of such Event of Default, irrespective of whether suit or other
proceeding has commenced in respect thereto, which shall include reasonable fees
and out-of-pocket expenses of counsel for the Agents and the Lenders, and the
reasonable fees and out-of-pocket expenses of any experts, agents, or
consultants engaged by the Agents and the Lenders.
Section 12.3 WAIVERS. The rights, remedies, powers and privileges of
the Credit Parties under this Agreement and the other Loan Documents shall be
cumulative and not exclusive of any rights, remedies, powers or privileges which
they would otherwise have. No failure or delay by the Credit Parties or the
Majority Lenders, or any of them, in exercising any right, remedy, power or
privilege shall operate as a waiver thereof. The Credit Parties expressly
reserve the right to require strict compliance with the terms of this Agreement
in connection with any funding of a request for an Advance. In the event the
Lenders decide to fund a request for an Advance at a time when the Borrowers are
not in strict compliance with the terms of this Agreement, such decision by the
Lenders shall not be deemed to constitute an undertaking by the Lenders to fund
any further requests for Advances or preclude the Lenders from exercising any
rights available to the Lenders under the Loan Documents or at law or equity.
Any waiver or indulgence granted by the Credit Parties or the Majority Lenders,
or any of them, shall not constitute a modification of this Agreement, except to
the extent expressly provided in such waiver or indulgence, or constitute a
course of dealing by the Credit
84
Parties or the Majority Lenders, or any of them, at variance with the terms of
the Agreement such as to require further notice of their intent to require
strict adherence to the terms of the Agreement in the future.
Section 12.4 SET-OFF. In addition to any rights and remedies now or
hereafter granted under Applicable Law and not by way of limitation of any such
rights, after the Maturity Date (whether by acceleration or otherwise), the
Lenders and any subsequent holder or holders of the Notes are hereby authorized
by each of the Borrowers at any time or from time to time, without notice to
such Borrower 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, time or demand, provisional or final, including, but not limited to,
Indebtedness evidenced by certificates of deposit, in each case whether matured
or unmatured) and any other Indebtedness at any time held or owing by the
Lenders or such holder to or for the credit or the account of any of the
Borrower Parties, against and on account of the obligations and liabilities of
the Borrower Parties, or any of them, to the Lenders or such holder under this
Agreement, the Notes and any other Loan Document, including, but not limited to,
all claims of any nature or description arising out of or connected with this
Agreement, the Notes or any other Loan Document, irrespective of whether or not
(a) the Lenders or the holders of the Notes shall have made any demand hereunder
or (b) the Lenders shall have declared the principal of and interest on the
Loans and the Notes and other amounts due hereunder to be due and payable as
permitted by Section 9.2 hereof and although said obligations and liabilities,
or any of them, shall be contingent or unmatured. Any sums obtained by any
Lender or by any subsequent holder of the Notes shall be subject to the
application of payments provisions of Article 2 hereof. Upon direction by the
Administrative Agent, with the consent of the Majority Lenders, after the
Maturity Date (whether by acceleration or otherwise), each Lender holding
deposits of any of the Borrower Parties shall exercise its set-off rights as so
directed.
Section 12.5 ASSIGNMENT.
(a) Neither of the Borrowers may assign or transfer any of
its rights or obligations hereunder or under the Notes without the prior written
consent of each of the Lenders.
(b) Each of the Lenders (other than the Swing Loan Lender
with respect to the Swing Loans) may at any time enter into assignment
agreements or participations with respect to its interest hereunder and under
the other Loan Documents with one or more other banks or other Persons (other
than either of the Borrowers or any of their respective Affiliates), provided
that (i) such Lender shall concurrently transfer to the proposed assignee a pro
rata share of its commitments and loans under the RMG Loan Agreement, and (ii)
any such assignment, together with the concurrent assignment under the RMG Loan
Agreement related thereto, shall be in an aggregate amount of not less than
$5,000,000 (unless such assignment is to another Lender or a Lender Affiliate
85
thereof). All of the foregoing assignments and participations shall be subject
to the following:
(i) Except for (A) assignments made to any Federal
Reserve Bank or which are otherwise permitted under Section 12.5(d) below and
(B) assignments made between any Lender and any Lender Affiliate of such Lender
or to another Lender or a Lender Affiliate of another Lender, no assignment
shall be made or sold without the consent of the Administrative Agent, which
consent shall not be unreasonably withheld or delayed and, if no Default or
Event of Default then exists, the consent of the Borrowers, which consent shall
not be unreasonably withheld or delayed.
(ii) Any Person purchasing a participation or an
assignment of the Loans from any Lender shall be required to represent and
warrant that its purchase shall not constitute a "prohibited transaction" (as
defined in Section 5.1(m) hereof).
(iii) The Borrowers and the Credit Parties agree that
assignments permitted hereunder (including the assignment of any Advance or
portion thereof) may be made with all voting rights, and shall be made pursuant
to an Assignment and Assumption Agreement. An administrative fee of $3,500 shall
be payable to the Administrative Agent by the assigning Lender at the time of
any assignment hereunder, including, without limitation, any assignment to a
Lender.
(iv) No participation agreement shall confer any
rights under this Agreement or any other Loan Document to any purchaser thereof,
or relieve any issuing Lender from any of its obligations under this Agreement,
and all actions hereunder shall be conducted as if no such participation had
been granted; PROVIDED, HOWEVER, that any participation agreement may confer on
the participant the right to approve or disapprove changes in the interest rate
and principal amount, fees and the Maturity Date.
(v) Each Lender agrees to provide the Administrative
Agent and the Borrowers with prompt written notice of any assignments of its
interests hereunder.
(vi) No assignment, participation or other transfer
of any rights hereunder or under the Notes shall be effected that would result
in any interest requiring registration under the Securities Act of 1933, as
amended, or qualification under any state securities law.
(vii) No such assignment, participation or transfer of
any rights hereunder may be made to any bank or other financial institution (A)
with respect to which a receiver or conservator (including, without limitation,
the Federal Deposit Insurance Corporation or the Office of Thrift Supervision)
has been appointed or (B) that has failed to meet any of the capital
requirements of its primary regulator or insurer.
86
(viii) If applicable, each Foreign Lender shall, and
shall cause each of its assignees that becomes a Foreign Lender to provide to
the Administrative Agent on or prior to the Agreement Date or the effective date
of any assignment, as the case may be, all appropriate Internal Revenue Service
forms required to be delivered by such Foreign Lender pursuant to Section
2.10(c)(iii) hereof.
(c) Except as specifically set forth in Section 12.5(b)
hereof, nothing in this Agreement or the Notes, expressed or implied, is
intended to or shall confer on any Person other than the respective parties
hereto and thereto and their successors and assignees permitted hereunder and
thereunder any benefit or any legal or equitable right, remedy or other claim
under this Agreement or the Notes.
(d) Notwithstanding anything contained herein to the
contrary, any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement and the Notes issued to such
Lender to secure obligations of such Lender, including, without limitation, any
pledge or assignment to secure obligations to a Federal Reserve Bank or its
trustee in support of its obligations thereto; PROVIDED, HOWEVER, that no such
pledge assignment shall release such Lender from any of its obligations
hereunder or under the Notes or substitute any such pledgee or assignee for such
Lender as a party hereto.
(e) An assigning Lender shall retain such indemnification
and expense reimbursement rights to which such Lender was entitled pursuant to
this Agreement to the effective date of the assignment of its rights hereunder.
Section 12.6 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such separate counterparts shall together constitute but one and the same
instrument. In proving this Agreement or any other Loan Document in any judicial
proceedings, it shall not be necessary to produce or account for more than one
such counterpart signed by the party against whom such enforcement is sought.
Any signatures delivered by a party by facsimile transmission shall be deemed an
original signature hereto.
Section 12.7 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK, INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF
THE NEW YORK GENERAL OBLIGATIONS LAW AND SECTION 327(b) OF THE NEW YORK CIVIL
PRACTICE LAWS AND RULES AND WITHOUT REFERENCE TO THE CONFLICT OR CHOICE OF LAW
PRINCIPLES THEREOF EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE
SECURITY INTEREST UNDER THE LOAN DOCUMENTS, OR REMEDIES UNDER THE LOAN
DOCUMENTS, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK.
87
Section 12.8 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof in that jurisdiction or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 12.9 HEADINGS. Headings and footnotes used in this Agreement
are for convenience only and shall not be used in connection with the
interpretation of any provision hereof.
Section 12.10 INTEREST.
(a) In no event shall the amount of interest due or payable
hereunder or under the Notes exceed the maximum rate of interest allowed by
Applicable Law, and in the event any such payment is inadvertently made by any
Borrower Party or is inadvertently received by any Lender, then such excess sum
shall be credited as a payment of principal, unless such Borrower Party shall
notify such Lender in writing that it elects to have such excess sum returned
forthwith. It is the express intent hereof that the Borrower Parties not pay and
the Lenders not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower Parties
under Applicable Law.
(b) Notwithstanding the use by the Lenders of the Prime
Rate, the Eurodollar Rate and the Federal Funds Rate as reference rates for the
determination of interest on the Loans, the Lenders shall be under no obligation
to obtain funds from any particular source in order to charge interest to the
Borrowers at interest rates tied to such reference rates.
Section 12.11 ENTIRE AGREEMENT. Except as otherwise expressly
provided herein, this Agreement, the Notes and the other Loan Documents embody
the entire agreement and understanding among the parties hereto and thereto and
supersede all prior agreements, understandings, and conversations relating to
the subject matter hereof and thereof.
Section 12.12 AMENDMENT AND WAIVER. Neither this Agreement nor any
Loan Document, nor any term or provision hereof or thereof, may be amended or
waived orally, but only by an instrument in writing signed by the Majority
Lenders (or, in the case of Security Documents executed by the Administrative
Agent, signed by the Administrative Agent and approved by the Majority Lenders)
and, in the case of an amendment, also by the Borrowers, except that (a) any
decrease (other than pro rata) or increase in the amount of the Commitment of
any Lender shall require the consent of such Lender, (b) any issuance of an
Incremental Facility Commitment shall require only the consent of the
Incremental Facility Lenders, the Borrowers and the Administrative Agent, (c)
any amendment of Section 12.5(b) hereof shall require the consent of the
Super-Majority Lenders, and (d) in the event of (i) any postponement in the
scheduled time as set forth in Section 2.7 hereof for the payment of, or any
reduction of, any
88
scheduled payments of principal or the rate of interest or fees due hereunder,
or any extension of the Maturity Date, (ii) any change in the definitions of
"Base Rate Applicable Margin" or "Eurodollar Applicable Margin," (iii) any
release or impairment of any Collateral or Guaranties relating to any MGM
Operating Company or any release or impairment of substantially all of the other
Collateral or Guaranties issued in favor of the Administrative Agent (other than
in connection with a disposition permitted under Section 8.5(a) or (b) hereof,
which may be released by the Administrative Agent without additional consent),
(iv) any waiver of any Event of Default due to the failure by the Borrower to
pay any sum due hereunder, (v) except in connection with the implementation of
the Incremental Facility to the extent necessary to accord the various types of
Incremental Facility Loans treatment similar to the treatment accorded Loans of
a similar type thereunder, any change to the application of payments made to the
Administrative Agent and the other Credit Parties described in Section 2.12(a)
hereof, or any change in the sharing of payment procedures described in Section
2.12(b) hereof, (vi) any amendment of the definition of "MGM Operating
Companies" or (vii) any amendment of this Section 12.12 or of the definitions of
"Majority Lenders" or "Super-Majority Lenders" or of any provision of this
Agreement which refers to "Majority Lenders" or "Super-Majority Lenders" if the
effect thereof would be to amend the definition of "Majority Lenders" or
"Super-Majority Lenders" as used in such provision, any amendment or waiver may
be made only by an instrument in writing signed by each of the Lenders and, in
the case of an amendment, also by the Borrowers; PROVIDED, HOWEVER,
notwithstanding anything to the contrary contained herein, any amendment of
Section 2.14 or any other term or provision of this Agreement or any other Loan
Document required in connection with the implementation of the Incremental
Facility shall require only the consent of the Majority Lenders and Borrowers.
Section 12.13 OTHER RELATIONSHIPS. No relationship created hereunder
or under any other Loan Document shall in any way affect the ability of any of
the Credit Parties to enter into or maintain business relationships with either
of the Borrowers or any of its Lender Affiliates beyond the relationships
specifically contemplated by this Agreement and the other Loan Documents.
Section 12.14 CONFIDENTIALITY. The parties hereto shall preserve in a
confidential manner all information received from any other party pursuant to
the Loan Documents and the transactions contemplated thereunder, and shall not
disclose such information except to any Agent, any Lender or any Persons with
which a confidential relationship is maintained (including designated agents,
legal counsel, accountants and regulators), or where required by law.
Section 12.15 LIABILITY OF PARTNERS, MEMBERS AND OTHER PERSONS.
Notwithstanding anything else in this Agreement to the contrary, the parties
hereto expressly agree that no partner, member, officer, director or other
holder of an ownership interest of or in any Borrower Party, RMHI or CSC, or any
partnership, limited liability company, corporation or other entity which is a
partner, member, stockholder or holder of
89
an ownership interest of or in any Borrower Party, RMHI or CSC shall have any
personal or individual liability or responsibility in respect of Obligations of
any Borrower Party, RMHI or CSC pursuant to this Agreement or any other Loan
Document solely by reason of his or her status as such partner, member, officer,
director, stockholder or holder.
Section 12.16 SURVIVAL. The provisions of this Agreement set forth in
Sections 2.10(c)(ii), 2.11, 6.12, 6.13, 10.11 and 11.3 hereof shall survive any
termination or expiration of this Agreement.
ARTICLE 13 - WAIVER OF JURY TRIAL
Section 13.1 WAIVER OF JURY TRIAL. EACH OF THE BORROWER PARTIES AND
EACH OF THE CREDIT PARTIES HEREBY AGREE TO WAIVE THE RIGHT TO A TRIAL BY JURY IN
ANY COURT AND IN ANY ACTION OR PROCEEDING OF ANY TYPE IN WHICH ANY OF THE
BORROWER PARTIES, ANY OF THE CREDIT PARTIES OR ANY OF THEIR RESPECTIVE
SUCCESSORS OR ASSIGNS IS A PARTY, AS TO ALL MATTERS AND THINGS ARISING DIRECTLY
OR INDIRECTLY OUT OF THIS AGREEMENT, ANY OF THE NOTES OR ANY OF THE OTHER LOAN
DOCUMENTS AND THE RELATIONS AMONG THE PARTIES LISTED IN THIS SECTION 13.1.
Section 13.2 CONSENT TO JURISDICTION. EACH OF THE BORROWER PARTIES
AND EACH OF THE CREDIT PARTIES HEREBY AGREE THAT ANY SUIT FOR THE ENFORCEMENT OF
THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS
OF THE STATE OF NEW YORK OR ANY FEDERAL COURT SITTING THEREIN AND EACH CONSENTS
TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND THE SERVICE OF PROCESS IN ANY
SUCH SUIT BEING MADE UPON THE BORROWERS BY MAIL AT THE ADDRESS SPECIFIED IN
SECTION 12.1. EACH OF THE BORROWER PARTIES HEREBY WAIVES ANY OBJECTIONS THAT IT
MAY NOW OR HEREAFTER HAVE TO THE VENUE OF SUCH SUIT OR ANY SUCH COURT OR THAT
SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
90
IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused it to be executed under seal by their duly authorized officers, all as of
the day and year first above written.
PAGE
BORROWERS: AMERICAN MOVIE CLASSICS COMPANY
By: American Movie Classics Holding Corporation,
as managing general partner
By: /s/ Xxxx Xxxx
------------------------------------------
Name: Xxxx Xxxx
-------------------------------------
Title: Authorized Signatory
------------------------------------
BRAVO COMPANY
By: Bravo Holding Corporation,
as managing general partner
By: /s/ Xxxx Xxxx
------------------------------------------
Name: XXxx Xxxx
-------------------------------------
Title: Authorized Signatory
------------------------------------
GUARANTORS: AMC PRODUCTIONS, INC.
WE: WOMEN'S ENTERTAINMENT PRODUCTIONS, INC.
BRAVO PROGRAMMING, INC.
IFC PROGRAMMING, INC.
By: /s/ Xxxx Xxxx
------------------------------------------
Name: Xxxx Xxxx
-------------------------------------
Title: Authorized Signatory
------------------------------------
of each of the above-named corporations
Signatures continue on next page
- ii -
PAGE
AMERICAN POP, LLC
WE: WOMEN'S ENTERTAINMENT LLC
AMC NEW MEDIA LLC
AMC VOD SERVICES LLC
By: American Movie Classics Company,
as sole member of each of the above-named
limited liability companies
By: American Movie Classics Holding Corporation,
as managing general partner of American Movie
Classics Company
By: /s/ Xxxx Xxxx
------------------------------------------
Name: Xxxx Xxxx
------------------------------------
Title: Authorized Signatory
------------------------------------
BRAVO ACQUISITION COMPANY LLC
THE INDEPENDENT FILM CHANNEL LLC
BRAVO NETWORKS VOD SERVICES LLC
BRAVO NETWORKS DIGITAL MEDIA LLC
By: Bravo Company, as sole member of each
of the above-named limited liability companies
By: Bravo Holding Corporation, as managing general
partner of American Movie Classics Company
By: /s/ Xxxx Xxxx
------------------------------------------
Name: Xxxx Xxxx
-------------------------------------
Title: Authorized Signatory
------------------------------------
Signatures continue on next page
- iii -
PAGE
ADMINISTRATIVE
AGENT AND LENDER: TORONTO DOMINION (TEXAS), INC.
By: /s/ Xxxx Xxxxxxx
------------------------------------------
Name: Xxxx Xxxxxxx
-------------------------------------
Title: Vice President
------------------------------------
Signatures continue on next page
- iv -
PAGE
SYNDICATION AGENT
AND LENDER: BANK OF AMERICA, N.A.
By: /s/ Xxxx Xxxxxxx
------------------------------------------
Name: Xxxx Xxxxxxx
-------------------------------------
Title: Managing Director
------------------------------------
Signatures continue on next page
- v -
PAGE
CO-LEAD ARRANGERS
AND CO-BANK RUNNERS: TD SECURITIES (USA) INC.
By: /s/ Xxxxx Xxxxxxx
------------------------------------------
Name: Xxxxx Xxxxxxx
-------------------------------------
Title: Managing Director
------------------------------------
BANC OF AMERICA SECURITIES LLC
By: /s/ Xxxxxxx Xxxxxxxxx
------------------------------------------
Name: Xxxxxxx Xxxxxxxxx
-------------------------------------
Title: Managing Director
------------------------------------
Signatures continue on next page
- vi -
LENDER: THE BANK OF NOVA SCOTIA
By: /s/ Xxxx X. Xxxxxxxxxxxxx
-----------------------------------------
Name: P. A. Xxxxxxxxxxxxx
------------------------------------
Title: Authorized Signatory
-----------------------------------
Signatures continue on next page
- vii -
PAGE
LENDER: BARCLAYS BANK PLC
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------------
Name: Xxxxxxx Xxxxxxxx
-------------------------------------
Title: Director
------------------------------------
Signatures continue on next page
- viii -
PAGE
LENDER: FLEET NATIONAL BANK
By: /s/ Xxxxxxx Xxxxxx
------------------------------------------
Name: Xxxxxxx Xxxxxx
-------------------------------------
Title: Managing Director
------------------------------------
Signatures continue on next page
- ix -
PAGE
CO-DOCUMENTATION AGENT
AND LENDER: GENERAL ELECTRIC CAPITAL
CORPORATION
By: /s/ Xxx Xxxxxxxx
--------------------------------------
Name: Xxx Xxxxxxxx
------------------------------------
Title: Senior Vice President
------------------------------------
Signatures continue on next page
- x -
PAGE
CO-DOCUMENTATION AGENT
AND LENDER:
CITICORP USA, INC.
By: /s/ Xxxxxxx Xxxxxxx
------------------------------------------
Name: Xxxxxxx Xxxxxxx
-------------------------------------
Title: Director
------------------------------------
Signatures continue on next page
- xi -
PAGE
LENDER:
BANK OF MONTREAL
By: /s/ Bin Xxxxxxxx
------------------------------------------
Name: Bin Xxxxxxxx
-------------------------------------
Title: Director
------------------------------------
Signatures continue on next page
- xii -
PAGE
LENDER:
THE BANK OF NEW YORK
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------------
Name: Xxxxxxx X. Xxxxx
-------------------------------------
Title: Senior Vice President
------------------------------------
Signatures continue on next page
- xiii -
PAGE
LENDER:
CREDIT LYONNAIS -NEW YORK BRANCH
By: /s/ Xxxxxx X. Xxxx
------------------------------------------
Name: Xxxxxx X. Xxxx
-------------------------------------
Title: Vice President
------------------------------------
Signatures continue on next page
- xiv -
PAGE
LENDER:
SOCIETE GENERALE
By: /s/ Xxxx Xxxxx
------------------------------------------
Name: Xxxx Xxxxx
-------------------------------------
Title: Managing Director
------------------------------------
Signatures continue on next page
- xv -
LENDER:
SUNTRUST BANK
By: /s/ Xxx Xxxx
-----------------------------------------
Name: Xxx Xxxx
-------------------------------------
Title: Vice President
------------------------------------
Signatures continue on next page
- xvi -
PAGE
LENDER:
XX XXXXXX XXXXX BANK
By: /s/ Xxxx X. Xxxxxxxxxx
------------------------------------------
Name: Xxxx X. Xxxxxxxxxx
-------------------------------------
Title: Managing Director
------------------------------------
Signatures continue on next page
- xvii -
PAGE
LENDER:
XXXXXXX XXXXX CAPITAL CORPORATION
By: /s/ Xxxxx X.X. Xxxxxx
------------------------------------------
Name: Xxxxx X.X. Xxxxxx
-------------------------------------
Title: Vice President
------------------------------------
Signatures continue on next page
- xviii -
PAGE
LENDER:
BEAR XXXXXXX CORPORATE LENDING, INC.
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxxx
-------------------------------------
Title: Executive Vice President
------------------------------------
Signatures continue on next page
- xix -
PAGE
LENDER:
THE FUJI BANK, LIMITED
By: /s/ Xxxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxxx Xxxxxxx
------------------------------------
Title: Senior Vice President
------------------------------------
- xx -
