90-DAY REVOLVING LOAN AGREEMENT
EXECUTION
COPY
JPMorgan
Chase Bank, N.A.
000
Xxxx Xxxxxx
Xxx
Xxxx, XX 00000
|
The
Royal Bank of Scotland plc
000
Xxxx Xxxxxx
Xxx
Xxxx, XX 00000
|
September
25, 2006
The
Reader’s Digest Association, Inc.
Reader’s
Xxxxxx Xxxx
Xxxxxxxxxxxxx,
XX 00000-0000
Ladies
and Gentlemen:
The
Reader’s Digest Association, Inc. (the “Borrower”)
has
requested JPMorgan Chase Bank, N.A. (“JPMCB”)
and
The Royal Bank of Scotland plc (“RBS”
and,
together with JPMCB, the “Lenders”)
to
extend commitments under which the Borrower may obtain loans (each such loan,
a
“Loan”
and
collectively, the “Loans”)
on a
revolving credit basis on and after the date hereof and at any time from time
to
time prior to the Maturity Date (as defined below) in an aggregate principal
amount outstanding at any time not to exceed $50,000,000. The Lenders have
agreed to make such Loans on the terms and subject to the conditions set forth
or incorporated by reference herein. The proceeds of the Loans will be used
for
general corporate purposes.
SECTION
1.01. Defined
Terms; Construction.
Subject
to the following sentence, all capitalized terms used in, or incorporated by
reference into, this Agreement but not otherwise defined herein shall be defined
as set forth in the Five-Year Revolving Credit Agreement dated as of April
14,
2005 (as amended, restated, supplemented or otherwise modified from time to
time, the “Existing
Five-Year Credit Agreement”),
among
the Borrower, certain subsidiaries of the Borrower, the lenders party thereto
and JPMorgan Chase Bank, N.A., as administrative agent and collateral
agent, but with the definitions in the Existing Five-Year Credit Agreement
being
modified and construed in accordance with the following sentence. All references
in the Existing Five-Year Credit Agreement, including in the schedules thereto
(or in provisions and schedules incorporated herein from the Existing Five-Year
Credit Agreement or defined terms used in such provisions and schedules) to
(i) the “Lenders”, the “Required Lenders”, the “Administrative Agent”, the
“Collateral Agent” or the “Agents” shall be deemed to be references to the
Lenders party to this Agreement, (ii) the “Borrowers” or the “Company” shall be
deemed to be references to the Borrower (as defined herein), (iii) any
“Borrowing Subsidiary” or “Canadian Subsidiary” shall be disregarded, (iii) the
“Subsidiary Guarantors” shall be deemed to be references to the subsidiaries of
the Borrower identified as “Guarantors” on the signature pages hereto, (iv) the
“Loan Parties” shall be deemed to be references to the Borrower and the
Subsidiary Guarantors, (v) “the “Commitments” shall be deemed to be
references to the commitments of the Lenders hereunder (the initial amounts
of
such Commitments being $25,000,000 for each Lender and $50,000,000 in the
aggregate for both Lenders), (vi) “Loans” shall be deemed to be references to
the Loans (as defined herein), (vii) “Interest Periods” shall be deemed to be
references to “Interest Periods” as defined in the Existing Five-Year Credit
Agreement, but without giving effect to references in such definition to
Interest Periods of three or six months’ duration and with Interest Periods
shorter than one month to be available subject to the consent of all the Lenders
to each such shorter Interest Period, (viii) “the date hereof” or “the date
of this Agreement” shall be deemed to be references to the date of this
Agreement, (ix) “this Agreement” or any “Loan Document” shall be deemed to
be references to this Agreement, (x) the “Maturity Date” shall be deemed to
be November 30, 2006, (xi) the “Transactions” shall mean the execution, delivery
and performance of this Agreement and the borrowings hereunder, (xii) the
“Effective Date” shall be deemed to be a reference to the date on which the
obligations of the Lenders under this Agreement shall become effective, and
(xiii) Articles and Sections shall be deemed to be references to such
Articles and Sections as incorporated by reference herein.
-1-
SECTION
1.02. Commitments.
Subject
to the terms and conditions and relying on the representations and warranties
set forth or incorporated by reference herein, each Lender severally agrees
to
make Loans to the Borrower, at any time and from time to time on and after
the
date hereof and until the earlier of the Maturity Date and the termination
of
the Commitments in accordance with the terms hereof, in an aggregate principal
amount outstanding at any time not to exceed such Lender’s Commitment, as the
same may be reduced from time to time pursuant to the terms hereof; provided,
however,
that
the Borrower shall not request, and Lenders shall not be obligated to make,
any
such Loan if, at the time of making such Loan, the aggregate Commitments (as
defined in the Existing Five-Year Revolving Credit Agreement) of the lenders
under the Existing Five-Year Credit Agreement shall exceed the aggregate
Revolving Credit Exposures (as defined in the Existing Five-Year Revolving
Credit Agreement) of such lenders. Within the limits of the preceding sentence,
the Borrower may borrow, pay or prepay and reborrow Loans on and after the
date
hereof and prior to the Maturity Date, on the terms and subject to the
conditions and limitations set forth herein.
SECTION
1.03. Incorporation
by Reference.
(a) The
provisions of the following Articles and Sections of the Existing Five-Year
Credit Agreement are incorporated herein by reference in their entirety, it
being agreed that (i) such provisions, including the defined terms used
therein and the definitions of such terms in the Existing Five-Year Credit
Agreement, shall be construed in accordance with Section 1.01 hereof, (ii)
all references in such provisions to notices, deliveries or payments to the
Administrative Agent will be deemed to refer to notices or deliveries given
or
made simultaneously to both Lenders or to payments made simultaneously and
ratably to both Lenders, and all references in such provisions to notices to
be
given and actions to be taken by the Administrative Agent will be deemed to
refer to notices jointly given and actions jointly taken by both Lenders and
(iii) in the event of any inconsistency between the provisions incorporated
herein by reference and the provisions expressly set forth herein, the
provisions expressly set forth herein shall control:
Article II:
Sections 2.02, 2.03, 2.04(a) (except that such paragraph shall be deemed to
require that each Lender fund its Loans by wire transfer of funds to the account
specified by the Borrower in the Borrowing Request delivered pursuant to Section
2.03 and the second sentence of such paragraph shall be disregarded), 2.05
(other than paragraph (c) of such Section), 2.06 (other than paragraph (d)
of
such Section), 2.07 (other than paragraph (b) of such Section), 2.08, 2.09,
2.10, 2.11, 2.14, 2.15, 2.16, 2.17, 2.18, 2.19, 2.20, 2.21 and 2.22(a) (with
the
references in Sections 2.11 and 2.14 to $10,000,000 being deemed to be
references to $5,000,000);
Article
III:
All
Sections in Article III (other than Sections 3.01(d), 3.01(f)(ii) and (iii),
3.01(g) and 3.01(i), and with the references in Section 3.01(h)(iii)(A) and
(B)
being deemed to require, in lieu of resolutions of the Board of Directors of
the
Borrower specifically authorizing the transactions contemplated hereby, evidence
satisfactory to the Lenders that the terms of this Agreement are being approved
by the chief executive officer of the Borrower pursuant to a delegation of
authority from the Board of Directors of the Borrower, and that the execution
and delivery of this Agreement have been approved pursuant to such delegation
of
authority);
-2-
Article
IV:
All
Sections in Article IV (except that references to “June 30, 2004” and to “KPMG
LLP” in Section 4.04 will be deemed to refer to June 30, 2006, and to Ernst and
Young LLP, respectively, and Sections 4.04(a)(ii) and 4.14 shall be
disregarded);
Article
V:
All
Sections in Article V (other than Sections 5.09 and 5.10);
Article
VI:
All
Sections in Article VI;
Article
VII:
All
provisions of Article VII;
Article
IX:
Section
9.03 (other than the clause “, and without limiting the provisions of Section
9.01,” in the first sentence thereof); and
Article
X:
Section
10.01(a) and (c) (with such paragraph (c) being deemed to require that notices
be sent to each Lender at the address for notices specified in the Existing
Five-Year Credit Agreement or at such other address as such Lender shall specify
by notice to the Borrower and the other Lender from time to time), 10.02, 10.03,
10.05, 10.06, 10.07, 10.08, 10.09, 10.10, 10.14(a) and (d) and
10.19.
(b)
The
Schedules attached to the Existing Five-Year Credit Agreement (other than
Schedule 2.01, which is replaced by Annex I hereto) will be deemed to
be attached hereto, with the terms used therein being defined as set forth
herein.
SECTION
1.04. Additional
Condition to Effectiveness.
In
addition to the conditions to the effectiveness of this Agreement incorporated
by reference from the Existing Five-Year Credit Agreement, it shall be a
condition to the effectiveness of this Agreement that the “Covenant Effective
Date” (as defined in the Second Amendment and Consent dated on or about
September 28, 2006, to the Existing Five-Year Credit Agreement) shall have
occurred or shall simultaneously occur.
-3-
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the date first above
written.
JPMORGAN
CHASE BANK, N.A., as a Lender,
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by:
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/s/
Xxxxxxxx Xxxxx
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Name:
Xxxxxxxx Xxxxx
Title:
Vice President
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THE
ROYAL BANK OF SCOTLAND PLC,
as a Lender,
|
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by:
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/s/
Xxxxxx Xxxx
|
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Name:
Xxxxxx Xxxx
Title:
Managing Director
|
Accepted
and Agreed to as of the date first appearing above:
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by
|
/s/
Xxxxxxx X. Xxxxxx
|
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Name:
Xxxxxxx X. Xxxxxx
|
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Title:
Vice President and Treasurer
|
BOOKS
ARE FUN, LTD., as a Guarantor,
|
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by
|
/s/
Xxxxxxx X. Xxxxxx
|
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Name:
Xxxxxxx X. Xxxxxx
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Title:
Vice President and Treasurer
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-4-
QSP,
INC., as a Guarantor,
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by
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/s/
Xxxxxxx X. Xxxxxx
|
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Name:
Xxxxxxx X. Xxxxxx
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Title:
Vice President and Treasurer
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XXXXXX
MEDIA GROUP, INC., as a Guarantor,
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by
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/s/
Xxxxxxx X. Xxxxxx
|
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Name:
Xxxxxxx X. Xxxxxx
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Title:
Vice President and Treasurer
|
-5-
Commitments
Lender
|
Allocation
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JPMorgan
Chase Bank, N.A.
|
$25,000,000.00
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The
Royal Bank of Scotland plc
|
$25,000,000.00
|
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Total:
|
$50,000,000.00
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