FIFTH AMENDMENT TO AMENDED
AND RESTATED CREDIT AGREEMENT
THIS FIFTH AMENDMENT TO AMENDED AND RESTATED CREDIT
AGREEMENT (the "Fifth Amendment") is entered into on November
30, 1998, but to be effective as of June 10, 1998 (the
"Effective Date"), by and among XXXXXX XXXXXX, INC., a Tennessee
corporation ("Xxxxxx"), SUNTRUST BANK, NASHVILLE, N.A., a
national banking association ("SunTrust"), the other banks and
lending institutions listed on the signature pages hereof and any
assignees of SunTrust or such other banks and lending
institutions that become "Lenders" (SunTrust and such other
banks, lending institutions and assignees are referred to
collectively herein as the "Lenders"), and SUNTRUST BANK,
NASHVILLE, N.A., in its capacity as agent for the Lenders (the
"Agent").
R E C I T A L S:
WHEREAS, Lenders, Agent and Xxxxxx entered into an Amended
and Restated Credit Agreement dated as of December 13, 1995, as
amended by that certain First Amendment to Amended and Restated
Credit Agreement dated as of January 3, 1996, as further amended
by that certain Second Amendment to Amended and Restated Credit
Agreement dated as of November 15, 1996, as further amended by
that certain Third Amendment to Amended and Restated Credit
Agreement dated as of January 7, 1997, and as further amended by
that certain Fourth Amendment to Amended and Restated Credit
Agreement dated as of March 31, 1998 (the "Fourth Amendment") (as
amended or otherwise modified from time to time, the "Credit
Agreement"), wherein Lenders agreed to extend certain financial
accommodations to Xxxxxx; and
WHEREAS, Xxxxxx has requested that Lenders consent to
Xxxxxx'x repurchasing of a portion of its outstanding common
stock and certain convertible subordinated notes and to use
proceeds of the Credit Agreement for such purpose, and Lenders
are willing to consent to such repurchasing and such use of
proceeds, and to modify the application of certain provisions of
the Credit Agreement with respect to such repurchasing and such
use of proceeds, upon the terms contained herein; and
WHEREAS, Xxxxxx has requested that Lenders consent to an
extension of the Initial Reduction Date, and Lenders are willing
to consent to such request, upon the terms contained herein; and
WHEREAS, Xxxxxx has requested that Lenders consent to a
change in the calculation with respect to adjustments concerning
certain pricing with respect to the Credit Agreement, and Lenders
are willing to consent to such request, upon the terms contained
herein; and
WHEREAS, Xxxxxx has requested that Lenders consent to an
increase in the Revolving Loan Commitment, and Lenders are
willing to consent to such request, upon the terms contained
herein; and
WHEREAS, Xxxxxx has requested that Lenders consent to
certain other changes in the Credit Agreement, as set forth
herein;
NOW, THEREFORE, in consideration of the premises and for
other good and valuable consideration, the receipt and adequacy
of which are mutually acknowledged, the parties hereby agree as
follows:
1. Defined Terms. All defined terms used and not otherwise
defined herein shall have the meaning ascribed to such terms
in the Credit Agreement.
2. Stock Repurchase. Xxxxxx may from time to time purchase up
to 3,000,000 shares (the "Maximum Number of Shares") of the
outstanding common stock of Xxxxxx (the "Stock Repurchase").
Xxxxxx'x common stock to be acquired pursuant to the Stock
Repurchase shall be referred to as the "Repurchased Shares."
Xxxxxx shall accomplish the Stock Repurchase by any of the
following (a) purchasing the Repurchased Shares on the open
market ("Open Market Acquisitions"), or (b) in privately
negotiated transactions ("Private Acquisitions"), or (c)
pursuant to a tender offer in accordance with Rule 13a-4
promulgated under the Securities Exchange Act of 1934 ("Self-
Tender"). The Stock Repurchase shall be completed in
accordance with one of the following schedules, as
applicable (the "Completion Date"): (i) on or before one (1)
year from the Effective Date in the event Xxxxxx utilizes a
Private Acquisition or Open Market Acquisitions to
accomplish the Stock Repurchase, or (ii) on or before ninety
(90) days from the date Xxxxxx initiates the Self-Tender
(the "Initiation Date") in the event Xxxxxx utilizes a Self-
Tender to accomplish the Stock Repurchase. The Initiation
Date may not occur more than one year after the Effective
Date. In the event Xxxxxx elects to accomplish the Stock
Repurchase pursuant to a Self-Tender, Xxxxxx shall give the
Agent written notice of the Initiation Date and the
anticipated Completion Date at least five (5) days prior to
the Initiation Date. Subject to the terms and provisions of
Section 2 and Section 3 hereof, Xxxxxx proposes to fund the
acquisition of the Repurchased Shares by utilizing a
combination of (a) its working capital and available cash,
and (b) borrowings under the Revolving Loan Commitments.
3. Lender's Consent. Xxxxxx has requested that Lenders consent
to the Stock Repurchase as described in this Fifth
Amendment, and that, with respect to the Stock Repurchase
only, Lenders consent to modify certain terms and provisions
of the Credit Agreement to permit the use of funds by Xxxxxx
as set forth in this Fifth Amendment to consummate the Stock
Repurchase. Lenders hereby consent to Xxxxxx'x request with
respect to the Stock Repurchase as described herein. Lenders
further consent to borrowings by Xxxxxx under the Revolving
Loan Commitments to wholly or partially fund the Stock
Repurchase. Xxxxxx shall be entitled to use borrowings under
the Revolving Loan Commitments for the Stock Repurchase
through the Completion Date; it shall make no additional
borrowings thereafter for the Stock Repurchase. After the
Completion Date, Xxxxxx shall not be permitted to borrow
under the Revolving Loan Commitments for the purpose of the
Stock Repurchase.
4. Terms of Stock Repurchase. Xxxxxx hereby covenants with
Lenders that in connection with the Stock Repurchase (a)
Xxxxxx shall purchase no more than the Maximum Number of
Shares, (b) the Stock Repurchase shall be completed on or
before the Completion Date, and (c) the price to be paid for
each Repurchased Share shall not exceed $18 per share
excluding ordinary and customary trading commissions and
fees.
5. Section 2.02 of the Credit Agreement. Lenders hereby agree
that Section 2.02 of the Credit Agreement is hereby modified
to permit the use by Xxxxxx of funds available under the
Revolving Loans to fund the Stock Repurchase. Any borrowing
of such funds shall be made in accordance with the Credit
Agreement as amended by this Fifth Amendment, including
without limitation, Article III and Article IV of the Credit
Agreement.
6. Section 11.04 of the Credit Agreement. Lenders hereby agree
that the provisions of Section 11.04 of the Credit Agreement
restricting the purchase of subordinated debt or capital
stock shall not apply to the Stock Repurchase.
7. Debenture Repurchase. Xxxxxx anticipates purchasing up to
$55,000,000 of its outstanding 5 3/4% Convertible Subordinated
Notes due November 30, 1999 in the total principal amount of
$55,000,000 and dated November 30, 1992 (the "Debenture
Repurchase"). Xxxxxx and Lender agree that at any time prior
to November 30, 1999 Xxxxxx may fund the Debenture
Repurchase by borrowings under the Revolving Loan
Commitment. Any borrowing of such funds shall be made in
accordance with the Credit Agreement, as amended, including
without limitation Articles III and IV of the Credit
Agreement.
8. Consent of Third Parties. Xxxxxx represents and warrants
that any and all consents required to be obtained by Xxxxxx
in connection with the Stock Repurchase and the funding of
same have been obtained and delivered to Agent.
9. Fee to Lender. Lenders and Xxxxxx hereby agree that
simultaneously with the execution of this Fifth Amendment,
Xxxxxx shall pay to Lenders a fee in the amount of Sixty-
Eight Thousand Seven Hundred Fifty and No/100 Dollars
($68,750.00) in consideration of Lenders' execution of this
Fifth Amendment and the agreements set forth herein.
10. Future Transactions. Xxxxxx and Lenders hereby agree that
the waivers and modifications set forth herein shall apply
only to the Stock Repurchase and the Debenture Repurchase,
shall terminate with respect to the Stock Repurchase on June
10, 1999, shall terminate with respect to the Debenture
Repurchase on November 30, 1999 and shall not extend to any
future stock acquisitions or uses of proceeds that may be
contemplated by Xxxxxx without the express written consent
of Lenders.
11. Extension of Initial Reduction Date. Xxxxxx has requested,
and Lenders hereby agree, that the Initial Reduction Date
shall mean December 13, 2001, pursuant to the provisions of
Section 2.08 of the Credit Agreement.
12. Change in Definitions. Xxxxxx and Lenders hereby agree that
the definitions of "Applicable LIBOR Rate Margin" and
"Commitment Percentage" shall be deleted in their entirety
and the following language shall be substituted in lieu of
such definitions:
"Commitment Percentage" shall mean the
relevant percentage indicated below based
upon the percentages indicated for Xxxxxx'x
Interest Coverage Ratio and Senior Funded
Debt to Total Capital as determined on a
quarterly basis, within sixty (60) days after
the end of each fiscal quarter of Xxxxxx and
on that date which is ninety (90) days after
the end of the fiscal year of Xxxxxx, based
upon unaudited financial statements for the
quarters ending June 30, September 30 and
December 31 and based upon audited financial
statements for the fiscal year ending March
31, with such Commitment Percentage to become
effective on the first business day of the
quarter immediately succeeding such date of
determination with respect to all outstanding
amounts under the Revolving Loans:
INTEREST COVERAGE | PERCENTAGE OF SENIOR
RATIO | FUNDED DEBT
| TO TOTAL CAPITAL
| >45% 35%-45% <35%
|---------------------------------
|
<2.5:1:0 | .375% .30% .25%
2.5:1.0 - 3.0:1.0 | .25% .25% .20%
>3.0:1.0 - 5.0:1.0 | .25% .20% .15%
>5.0:1.0 | .20% .15% .125%
Notwithstanding the foregoing, in
the event Xxxxxx does not deliver the
audited financial statements for the
immediately preceding fiscal year, or
unaudited financial statements for the
immediately preceding fiscal quarter, as
applicable, in a manner that permits the
determinations required in the
definition of the Commitment Percentage
within ninety (90) days of the end of
Xxxxxx'x fiscal year or within sixty
(60) days of the end of each fiscal
quarter, as applicable, commencing at
the end of such ninety (90) day or sixty
(60) day period, as applicable, and
continuing until such audited or
unaudited financial statements, as
applicable, are made available, the
Commitment Percentage shall be the
highest percentage set forth in the
preceding chart. At such time as Agent
changes the Commitment Percentage as set
forth in the preceding sentence, it
agrees to give written notice of such
change to Xxxxxx and to reduce the
Commitment Percentage to its appropriate
rate at such time as Xxxxxx delivers the
financial statements as set forth
herein.
"Applicable LIBOR Rate Margin" shall
mean, with respect to all outstanding
Borrowings consisting of LIBOR Advances
hereunder, the relevant percentage
indicated below based upon the
percentages indicated for Xxxxxx'x
Interest Coverage Ratio and Senior
Funded Debt to Total Capital as
determined on the date that is sixty
(60) days after the end of each fiscal
quarter and on the date that is ninety
(90) days after the end of each fiscal
year of Xxxxxx; based, in the case of
the end of any quarter, upon unaudited
financial statements for the immediately
preceding fiscal quarter, and based, in
the case of the fiscal year end, upon
audited financial statements for the
immediately preceding fiscal year, with
such Applicable LIBOR Rate Margin to
become effective on the first business
day of the quarter immediately
succeeding such date of determination
with respect to all outstanding amounts
under the Revolving Loans:
INTEREST COVERAGE | PERCENTAGE OF
RATIO | SENIOR FUNDED DEBT
| TO TOTAL CAPITAL
| >45% 35%-45% <35%
|---------------------------------
|
<2.5:1:10 | 1.00% .875% .75%
2.5:1.0 - 3.0:1.0 | .875% .75% .625%
>3.0:1.0 - 5.0:1.0 | .75% .625% .50%
>5.0:1.0 | .625% .50% .375%
Notwithstanding the foregoing, in the
event Xxxxxx does not deliver the audited or
unaudited financial statements for the
immediately preceding fiscal year or fiscal
quarter, as applicable, in a manner that
permits the determinations required in the
definition of Applicable LIBOR Rate Margin
within ninety (90) days of the end of
Xxxxxx'x fiscal year and within sixty (60)
days of the end of each fiscal quarter, as
applicable, commencing at the end of such
ninety (90) day or sixty (60) day period, as
applicable, and continuing until such audited
or unaudited financial statements, as
applicable, are made available, the
Applicable LIBOR Rate Margin shall be the
highest rate set forth in the preceding
chart. At such time as the Agent changes the
interest rate as set forth in the preceding
sentence, it agrees to give written notice of
such change to Xxxxxx and to reduce the
Commitment Percentage to its appropriate rate
at such time as Xxxxxx delivers the financial
statements as set forth herein.
The table below shall reflect the effective
date(s) with respect to the quarterly
determination(s) required by the definitions of
the "Applicable LIBOR Rate Margin" and "Commitment
Percentage":
DATE OF DELIVERY
OF FINANCIAL EFFECTIVE
PERIOD STATEMENTS DATE
------------------------------------------------------------
Fiscal Year Within 90 days Effective the first
ending March 31 (audited financial business day after
statements June 30
Quarter ending Within 60 days Effective the first
June 30 (unaudited financial business day after
statements) September 30
Quarter ending Within 60 days Effective the first
September 30 (unaudited financial business day after
statements) December 31
Quarter ending Within 60 days Effective the first
December 31 (unaudited financial business day after
statements) March 31
13. Revolving Loan Commitment. The aggregate amount of Revolving
Loan Commitments of the Lenders shall be One Hundred Million
Dollars ($100,000,000) principal amount, and the pro rata
portions of each Lender shall be as set forth in Exhibit A
attached hereto. Xxxxxx shall execute new Revolving Credit
Notes in the amounts set forth in Exhibit A and shall
promptly execute and deliver such Notes to Agent.
14. Final Maturity Date. The parties hereto agree that the
phrase "December 13, 2002" set forth in the definition of
"Final Maturity Date" in the Credit Agreement shall be
deleted and be replaced with "December 13, 2005".
15. Sale of Assets. Lenders consent to the sale of assets by
Xxxxxx of X.X. Xxxxxx Company and hereby waive the
requirements of Section 2.06 of the Credit Agreement with
respect to such asset sales; provided, however, that the
only assets which may be sold pursuant to this section are
those listed on Exhibit B attached hereto, and further
provided that the total amount of proceeds resulting from
such asset sales shall not exceed $14,000,000 in the
aggregate. Lenders acknowledge that Xxxxxx shall not be
required to use proceeds of such asset sales to reduce
amounts outstanding under the Revolving Credit Notes.
16. Effective Date. Although the parties hereto agree that the
effective date of this Fifth Amendment is as of June 10,
1998, the quarterly determinations required by the
definitions of "Applicable LIBOR Rate Margin" and
"Commitment Percentage" shall be effective commencing with
the quarter ending September 30, 1998.
17. Governing Law. This Fifth Amendment shall be governed by and
construed in accordance with the laws of the State of
Tennessee.
18. Full Force and Effect. Except as specifically amended by
this Fifth Amendment, all other terms and provisions of the
Credit Agreement shall remain in full force and effect.
19. No Other Waiver. Except as expressly stated herein, no other
waiver of any term or provision of the Credit Agreement
shall be inferred or implied.
IN WITNESS WHEREOF, the parties have caused this Fifth
Amendment to be duly executed as of the Effective Date.
XXXXXX XXXXXX, INC.
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title: Executive Vice President
-------------------------------
ACCEPTED AND AGREED TO:
SUNTRUST BANK, NASHVILLE, N.A., as Agent
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Title: Senior Vice President
-------------------------------
Acceptance Date: November 30, 1998
---------------------
SUNTRUST BANK, NASHVILLE, N.A.
(Revolving Credit Amount: $26,000,000)
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Title: Senior Vice President
-------------------------------
Acceptance Date: November 30, 1998
---------------------
NATIONSBANK, N.A.
(Revolving Credit Amount: $20,000,000)
By: /s/ Xxxx X. Xxxxx, Xx.
----------------------------------
Title: Senior Vice President
-------------------------------
Acceptance Date: November 30, 1998
---------------------
CREDITANSTALT CORPORATE FINANCE, INC.
(Revolving Credit Amount: $17,000,000)
By: /s/ Xxxx X. Xxxxxx
----------------------------------
Title: Senior Associate
-------------------------------
By: /s/ Xxxxxxx X. XxXxxxxx
----------------------------------
Title: Senior Associate
-------------------------------
Acceptance Date: November 30, 1998
---------------------
NATIONAL CITY BANK, KENTUCKY
(Revolving Credit Amount: $17,000,000)
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------
Title: Vice President
-------------------------------
Acceptance Date: November 30, 1998
---------------------
FIRST AMERICAN NATIONAL BANK
(Revolving Credit Amount: $20,000,000)
By: /s/ Xxxxx Xxxx
----------------------------------
Title: Senior Vice President
-------------------------------
Acceptance Date: November 30, 1998
---------------------
The undersigned join in the execution of this Fifth
Amendment in order to acknowledge their consent to the terms and
provisions of this Fifth Amendment and to confirm that the
execution of this Fifth Amendment by the parties hereto in no way
affects the undersigneds' respective obligations under the
Amended and Restated Guaranty Agreement executed as of December
13, 1995 by Word, Incorporated, a corporation organized and
existing under the laws of the State of Delaware, PPC, Inc., a
corporation organized and existing under the laws of the State of
North Carolina, Editorial Caribe, Inc., a corporation organized
and existing under the laws of the State of Florida, Morningstar
Radio Network, Inc., a corporation organized and existing under
the laws of the State of Texas, Xxxxxx Word Ltd., a corporation
organized and existing under the laws of the United Kingdom, Word
Communications, Ltd., a corporation organized and existing under
the laws of British Columbia, Canada, Word Direct, Inc., a
corporation organized and existing under the laws of the State of
Texas, Word Direct Partners, L.P., a limited partnership
organized and existing under the laws of the State of Texas, The
X.X. Xxxxxx Company, a corporation organized and existing under
the laws of the State of Delaware, 855673 Ontario Limited, a
corporation organized and existing under the laws of Ontario,
Canada, in favor of SunTrust Bank, Nashville, N.A., a national
banking association, in its capacity as agent for banks and other
lending institutions parties to the Credit Agreement and each
assignee thereof becoming a "Lender" as provided therein. Each
person executing this Amendment on behalf of each of the
undersigned is duly authorized to so execute and deliver this
Amendment on behalf of each of the undersigned entities.
WORTHY, INCORPORATED (f/k/a
WORD, INCORPORATED)
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title:
-----------------------------
EDITORIAL CARIBE, INC.
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title:
-----------------------------
X.X. XXXXXX (UK) LIMITED (f/k/a
XXXXXX MEDIA (UK) LTD.
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title:
-----------------------------
XXXXXX MEDIA (CANADA) LTD.
(f/k/a WORD COMMUNICATIONS, LTD.)
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title: President
-----------------------------
XXXXXX DIRECT, INC. (f/k/a WORD
DIRECT, INC.)
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title: Treasurer and Secretary
-----------------------------
XXXXXX DIRECT MARKETING SERVICES,
INC.
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title: Treasurer and Secretary
-----------------------------
XXXXXX DIRECT PARTNERS, L.P.
(f/k/a WORD DIRECT PARTNERS, L.P.)
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title: Treasurer and Secretary
-----------------------------
THE X.X. XXXXXX COMPANY
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title: Treasurer and Secretary
-----------------------------
CRG ACQUISITION, INC.
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title: Treasurer and Secretary
-----------------------------
855763 ONTARIO LIMITED (d/b/a XXXX
DISTRIBUTORS)
By: /s/ Xxx X. Xxxxxx
-------------------------------
Title: Secretary
-----------------------------
EXHIBIT A
REVOLVING LOAN COMMITMENTS
SunTrust Bank, Nashville, N.A. $ 26,000,000
First American National Bank 20,000,000
NationsBank, N.A. 20,000,000
National City Bank, Kentucky 17,000,000
Creditanstalt Corporate Finance, Inc. 17,000,000
----------------
TOTAL $ 100,000,000
EXHIBIT B
ADDRESS DESCRIPTION LOCATION
------- ----------- --------
00 Xxxxxx Xxxxxx Xxxxxxxxxxxxx, Xxxxxxx, XX
warehousing, shipping
and office space
00 Xxxxxx Xxxxxx Factory Outlet Store Norwalk, CT
00 Xxxxxx Xxxxxx .38 acre lot w/unoccupied Norwalk, CT
apartment house
00 Xxxxx Xxxxxx 1.24 acre empty lot Norwalk, CT
00 Xxxxx Xxxxxx Xxxxxxxxx Xxxxxx Xxxxxxx, XX
Including land and buildings, equipment, work in process and raw
materials included in or located at the locations described
above.
