EXHIBIT 10.37
FIFTH AMENDMENT
TO
REVOLVING CREDIT AGREEMENT
Fifth Amendment dated as of September 30, 1998 to Revolving Credit
Agreement (the "Fifth Amendment"), by and among CMG INFORMATION SERVICES, INC.,
a Delaware corporation (the "Borrower"), BANKBOSTON, N.A. (FORMERLY KNOWN AS THE
FIRST NATIONAL BANK OF BOSTON) and the other lending institutions listed on
Schedule 1 to the Credit Agreement (as hereinafter defined) (the "Banks"),
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amending certain provisions of Revolving Credit Agreement dated as of May 14,
1997 (as amended and in effect from time to time, the "Credit Agreement") by and
among the Borrower, the Banks and BankBoston, N.A. as agent for the Banks (the
"Agent"). Terms not otherwise defined herein which are defined in the Credit
Agreement shall have the same respective meanings herein as therein.
WHEREAS, the Borrower and the Banks have agreed to modify certain terms and
conditions of the Credit Agreement as specifically set forth in this Fifth
Amendment;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
(S)1. AMENDMENT TO SECTION 1 OF THE CREDIT AGREEMENT. Section 1 of the
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Credit Agreement is hereby amended by inserting the following definition in the
appropriate alphabetical order:
Hollywood Entertainment Acquisition. The acquisition by the Borrower of
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approximately 2,327,934 shares of the capital stock of Hollywood
Entertainment Corporation for a cash purchase price of approximately $13.50
per share for a total cash consideration of not more than $31,623,020.20,
with the terms of such acquisition all to be on substantially the terms and
conditions contained in the Stock Purchase Agreement dated July 30, 1998
among Hollywood Entertainment Corporation, the Borrower and certain other
parties thereto, as amended and the Transfer Agreement dated on or about
October 1, 1998 among Xxxxx Xxxx, the Borrower and certain other parties
thereto and satisfactory to the Agent.
(S)2. AMENDMENT TO SECTION 7 OF THE CREDIT AGREEMENT. Section 7 of the
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Credit Agreement is hereby amended as follows:
(a) Section 7.2(c)(iv) of the Credit Agreement is hereby amended by
deleting the text of (S)7.2(c)(iv) in its entirety and restating it as follows:
"(iv) Investments made by the Borrower in compliance with its Investment Policy,
Investments consisting of acquisitions permitted by (S)7.2(e) hereof, the
Investment by the Borrower in Open Market, Inc. provided such Investment is made
on or prior to July 31, 1998 and is in the aggregate amount of not more than
$5,000,000 and the Investment made by the Borrower on or about July 16, 1998 in
Magnitude Network, LLC provided such Investment is in the aggregate amount of
not more than $500,000."
(b) Section 7.2(e) of the Credit Agreement is hereby amended by deleting
(S)7.2(e) in its entirety and restating it as follows:
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(e) become party to a merger or sale-leaseback transaction, or to
effect any disposition of assets other than in the ordinary course, and
other than the sale of shares of a wholly-owned Subsidiary of the Borrower
so long as the net cash proceeds of such sale received by the Borrower are
equal to or greater than the carrying costs of the remaining shares of such
Subsidiary after giving effect to such sale, or to purchase, lease or
otherwise acquire assets other than in the ordinary course (with the
parties hereto hereby acknowledging that minority Investments by the
Borrower in CMG @ Ventures 1, CMG @ Ventures II and CMG @ Ventures III,
L.P. shall be considered acquisitions of assets in the ordinary course);
provided, however, the Borrower shall be permitted to (1) merge Accipiter,
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Inc. with and into Engage Technology, Inc.; (2) sell or otherwise transfer
the shares of the capital stock of each of InSolutions Incorporated and On-
Demand Solutions, Inc. to SalesLink; and (3) acquire assets and/or stock of
another entity so long as (i) such entity is in the same or a similar line
of business as the Borrower; (ii) other than in connection with the
Accipiter Acquisition and the Servercast Acquisition, the Borrower has
provided the Bank with five (5) Business Days prior written notice of such
acquisition, which notice shall include a reasonably detailed description
of such acquisition; (iii) the business and/or entity to be acquired would
not subject the Agent or any Bank to regulatory or third party approvals in
connection with the exercise of its rights and remedies under this
Agreement or the other Loan Documents; (iv) other than in connection with
the Accipiter Acquisition, the InSolutions Acquisition or the Servercast
Acquisition, the Borrower has demonstrated to the satisfaction of the Agent
and the Banks, based on a pro forma Compliance Certificate, compliance with
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(S)7.3 on a pro forma basis immediately prior to and after giving effect to
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any such acquisition; (v) the business and assets so acquired in each such
acquisition shall be acquired by the Borrower free and clear of all liens
and Indebtedness, except those expressly permitted by the Agent pursuant to
that certain consent letter dated as of July 31, 1998 pertaining to the
OnDemand Acquisition; and (vi) the aggregate purchase price of all
acquisitions permitted hereunder does not exceed the greater of (1)
$11,000,000 and (2) the aggregate purchase price of each of the Accipiter
Acquisition, the Servercast Acquisition, the InSolutions Acquisition, the
OnDemand Acquisition and the Hollywood Entertainment Acquisition during the
term of this Agreement.
(S)3. AMENDMENT TO JULY 31, 1998 CONSENT LETTER. The letter dated as of
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July 31, 1998 from the Agent and the Banks to the Borrower consenting to the
OnDemand Acquisition is hereby amended by deleting the reference to "sixty (60)
days" which appears in subparagraphs (e) and (f) of such letter and substituting
in place thereof a reference to "ninety (90) days".
(S)4. LIMITED WAIVER. The Agent and the Banks hereby waive as of the date
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hereof, to the limited extent necessary to permit any noncompliance for the
period of July 16, 1998 through the date hereof, any Default or Event of Default
of (S)7.2(c)(iv) of the Credit Agreement which occurred as a result of the
Borrower's $500,000 Investment on or about July 16, 1998 in Magnitude Network,
LLC.
(S)5. CONDITIONS TO EFFECTIVENESS. This Fifth Amendment shall not become
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effective until the Agent receives a counterpart of this Fifth Amendment,
executed by the Borrower and the Banks.
(S)6. REPRESENTATIONS AND WARRANTIES. The Borrower hereby repeats, on and
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as of the date hereof, each of the representations and warranties made by it in
(S)5 of the Credit Agreement, and such representations and warranties remain
true as of the date hereof (except to the extent of changes resulting from
transactions contemplated or permitted by the Credit Agreement and the other
Loan Documents and
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changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and to the extent that such
representations and warranties relate expressly to an earlier date),
provided, that all references therein to the Credit Agreement shall refer to
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such Credit Agreement as amended hereby. In addition, the Borrower hereby
represents and warrants that the execution and delivery by the Borrower of this
Fifth Amendment and the performance by the Borrower of all of its agreements and
obligations under the Credit Agreement as amended hereby are within the
corporate authority of each the Borrower and has been duly authorized by all
necessary corporate action on the part of the Borrower.
(S)7. RATIFICATION, ETC. Except as expressly amended hereby, the Credit
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Agreement and all documents, instruments and agreements related thereto are
hereby ratified and confirmed in all respects and shall continue in full force
and effect. The Credit Agreement and this Fifth Amendment shall be read and
construed as a single agreement. All references in the Credit Agreement or any
related agreement or instrument to the Credit Agreement shall hereafter refer to
the Credit Agreement as amended hereby.
(S)8. NO WAIVER. Nothing contained herein shall constitute a waiver of,
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impair or otherwise affect any Obligations, any other obligation of the Borrower
or any rights of the Agent or the Banks consequent thereon.
(S)9. COUNTERPARTS. This Fifth Amendment may be executed in one or more
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counterparts, each of which shall be deemed an original but which together shall
constitute one and the same instrument.
(S)10. GOVERNING LAW. THIS FIFTH AMENDMENT SHALL BE GOVERNED BY, AND
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CONSTRUED IN ACCORDANCE WITH, THE LAWS OF COMMONWEALTH OF MASSACHUSETTS (WITHOUT
REFERENCE TO CONFLICT OF LAWS).
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IN WITNESS WHEREOF, the parties hereto have executed this Fifth Amendment
as a document under seal as of the date first above written.
CMG INFORMATION SERVICES, INC.
By:
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Title:
BANKBOSTON, N.A.
By:
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Title:
