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Exhibit 10.1
SPELLING ENTERTAINMENT GROUP INC.
AND ITS SUBSIDIARIES, AS BORROWERS
CREDIT AGREEMENT
Dated as of September 30, 1996
VIACOM INC., AS LENDER
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS: CERTAIN RULES OF CONSTRUCTION
Definitions ................................................ 1
ARTICLE II
AMOUNT AND TERMS OF THE REVOLVING CREDITS
2.1. Revolving Loans ............................................ 9
2.2. Borrowing Requests ......................................... 10
2.3. Revolving Note ............................................. 10
2.4. Application of Proceeds .................................... 10
ARTICLE III
THE TERM LOAN
3.1. Term Loan .................................................. 10
3.2. Term Note .................................................. 11
3.3. Virgin Term Loan ........................................... 11
3.4. Virgin Term Note ........................................... 11
ARTICLE IV
CONVERSION, INTEREST, PAYMENTS, FEES, ETC.
4.1. Conversion/Continuation Option ............................. 11
4.2. Interest ................................................... 12
4.3. Interest on Overdue Amounts ................................ 12
4.4. Limitation by Applicable Law ............................... 12
4.5. Commitment Fee ............................................. 12
4.6. Facility Fee ............................................... 13
4.7. Annual Administrative Fee .................................. 13
4.8. Computations of Interest and Fees .......................... 13
4.9. Break-Funding Costs ........................................ 13
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ARTICLE V
PAYMENTS
5.1. Payment at Maturity ....................................... 13
5.2. Prepayments ............................................... 14
5.3. Reborrowings .............................................. 14
5.4. Payment with Accrued Interest ............................. 14
5.5. Payments .................................................. 14
ARTICLE VI
CONDITIONS OF LENDING
6.1. Conditions to Each Extension of Credit .................... 15
ARTICLE VII
COVENANTS
7.1. Minimum Net Worth ......................................... 15
7.2. Non-Borrower Subsidiaries ................................. 15
7.3. Compliance Statements ..................................... 16
7.4. Disposition of Assets ..................................... 16
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
8.1. Borrower's Representations and Warranties ................. 16
8.2. Lender's Representations and Warranties ................... 17
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ARTICLE IX
EVENTS OF DEFAULT
9.1. Events of Default ........................................... 18
9.2. Certain Actions Following an Event of Default ............... 21
9.3. Annulment of Defaults ....................................... 22
9.4. Waivers ..................................................... 22
ARTICLE X
MISCELLANEOUS
10.1. Expenses .................................................... 22
10.2. General Indemnity ........................................... 23
10.3. Successors and Assigns ...................................... 23
10.4. Notices ..................................................... 24
10.5. Course of Dealing: Amendments and Waivers ................... 24
10.6. Venue: Service of Process ................................... 24
10.7. General ..................................................... 25
10.8. Section Titles .............................................. 25
10.9. Execution in Counterparts ................................... 25
SCHEDULES AND EXHIBITS
Exhibit 2.3 Revolving Note
Exhibit 3.2 Term Note
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SPELLING ENTERTAINMENT GROUP INC.
CREDIT AGREEMENT
This Agreement, dated as of September 30, 1996 is among Spelling
Entertainment Group Inc., a Delaware corporation, its subsidiaries that are from
time to time party hereto and Viacom Inc., a Delaware corporation ("Lender").
The parties agree as follows:
ARTICLE I
DEFINITIONS
1.1. Defined Terms. Except as otherwise explicitly specified to
the contrary, (a) the capitalized term "Section" refers to sections of this
Agreement, (b) the capitalized term "Exhibit" refers to exhibits to this
Agreement, (c) references to a particular Section include all subsections
thereof, (d) the word "including" shall be construed as "including without
limitation", (e) accounting terms not otherwise defined herein shall have the
respective meanings provided under GAAP and (f) terms defined in the UCC and
not otherwise defined herein shall have the respective meanings provided under
the UCC. Certain capitalized terms are used in this Agreement, as specifically
defined as follows:
"Affiliate" means, with respect to any Person (or other specified
Person), any other Person directly or indirectly controlling, controlled by or
under direct or indirect common control with, that Person, and shall include
(a) any officer or director or general partner of that Person and (b) any
Person of which that Person or any Affiliate (as defined in clause (a) above)
of that Person shall, directly or indirectly, beneficially own either (i) at
least 10% of the outstanding equity securities having the general power to vote
or (ii) at least 10% of all equity interests; provided, however, that for
purposes of the Credit Documents, none of Lender or its officers, directors,
shareholders, Affiliates and Subsidiaries (other than Company and its
Subsidiaries) shall be deemed Affiliates of the Company, the other Borrowers or
the Company's other Subsidiaries.
"Agreement" means this Credit Agreement, as amended, supplemented
or modified from time to time.
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"Applicable Eurodollar Rate Margin" shall mean, for any Fiscal Quarter,
the percentage set forth below opposite the Total Debt/EBITDA ratio of the
Borrower, as determined as of the end of the last preceding Fiscal Quarter for
which the Lender has received a compliance certificate:
Total Debt/EBITDA
Ratio Margin
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>7.0x 2.50%
6.0x-7.0x 2.00%
5.5x-6.0x 1.50%
5.0x-5.5x 1.00%
<5.0x .75%
"Applicable Rate" means: (a) with respect to each Eurodollar Rate
Loan hereunder, the Eurodollar Rate and (b) with respect to each Base Rate Loan
hereunder, the Base Rate.
"Articles" means the articles of organization, certificate of
incorporation, trust indenture statute, constitution, joint venture agreement,
partnership agreement or other charter document of any Person other than an
individual, each as from time to time in effect.
"Authorized Officer" shall mean, with respect to the Borrower, its
chief executive officer, executive vice president, senior vice president, chief
financial officer, chief accounting officer or treasurer.
"Banking Day" means any day other than Saturday, Sunday or a day on
which banks in Los Angeles, California or New York City, New York are
authorized or required by law or other governmental action to close.
"Bankruptcy Code" means Title 11 of the United States Code (or any
successor statute) and the rules and regulations thereunder, all as from time
to time in effect.
"Bankruptcy Default" means an Event of Default referred to in
Section 9.1(k)
"Base Rate" means, for any day, a fluctuating interest rate per
annum as shall be in effect for such day, which rate per annum shall be equal
at all times to the higher of:
(a) the rate of interest announced publicly by the Administrative
Agent of the Viacom Credit Facilities in New York, New York as
the Administrative Agent's base rate in effect for such day; or
(b) the Federal Funds Rate for such day plus 1/2 of 1 % per annum.
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"Base Rate Loan" means any Loan or portion thereof that bears
interest with reference to the Base Rate.
"Borrower" or "Borrowers" means the Company and each of the
Company's Subsidiaries indicated as Borrowers on the signature pages hereof (or
pursuant to a joinder hereto) on a joint and several basis.
"By-laws" means all written by-laws, rules, regulations and all
other documents relating to the management, governance or internal regulation
of any Person other than an individual, or interpretive of the Articles of such
Person, all as from time to time in effect.
"Capitalized Leases" means, as applied to any person, any lease of
property by such Person as lessee which should be capitalized on a balance
sheet of such person prepared in accordance with GAAP.
"Closing Date" means each date on which any extension of credit is
made pursuant to Section 2.1.
"Collateral" has the meaning assigned to that term in the Pledge
and Security Agreement or any other Security Document.
"Commitment" means Lender's obligations to extend the credits
contemplated by the Credit Documents.
"Commitment Termination Date" means, the earlier of (i) Final Loan
Maturity Date, or (ii) the date of the earlier termination of the Commitment
pursuant to the terms hereof.
"Company" means Spelling Entertainment Group Inc., a Delaware
corporation.
"Copyright Mortgages and Assignments" has the meaning assigned to
that term in the Pledge and Security Agreement.
"Credit Documents" means:
(a) this Agreement, the Notes, and the Guaranty, each as
from time to time in effect;
(b) all Security Documents, reports, notices, mortgages,
assignments, UCC financing statements or certificates
delivered to the Lender by the Company or any of its
Subsidiaries or Affiliates in connection herewith or
therewith; and
(c) any other present or future agreement or instrument from
time to time entered into among the Company, any of its
Subsidiaries or (so long as the Company
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or its Subsidiary is also party thereto) any Affiliate of
any of them, on one hand, and the Lender, on the other
hand, relating to, amending or modifying this Agreement or
any other Credit Document referred to above or which is
stated to be a Credit Document, each as from time to
time in effect.
"Credit Obligations" means all present and future liabilities,
obligations and Indebtedness of the Company, any of its Subsidiaries or any of
their respective Affiliates party to a Credit Document owing to Lender or any
other Indemnified Party under or in connection with this Agreement or any other
Credit Document, including obligations in respect of principal, interest,
commitment fees, and other fees, charges, indemnities and expenses from time to
time owing hereunder or under any other Credit Document (whether accruing
before or after a Bankruptcy Default).
"Credit Security" means all assets now or from time to time
hereafter subjected to a security interest, mortgage or charge (or intended or
required so to be subjected pursuant to this Agreement, the Security Documents
or any other Credit Document) to secure the payment or performance of any of
the Credit Obligations, including the Collateral described in the Security
Documents.
"Default" means any Event of Default and any event or condition
which with the passage of time or giving of notice, or both, would become an
Event of Default.
"Earnings from Operations" means, at any time, for the Borrower and
its Subsidiaries, revenue plus equity in earnings of affiliated companies, less
(i) operating expenses (ii) selling expenses, (iii) general and administrative
expenses and (iv) depreciation and amortization expenses.
"EBITDA" means, at any time, the Earnings from Operations of the
Borrower and its Subsidiaries on a consolidated basis as set forth in the
statement of operations of the Borrower and its Subsidiaries for the
immediately preceding four Fiscal Quarters (adjusted to account for material
dispositions during such four Fiscal Quarters), plus (to the extent previously
deducted) (a) the sum of the following expenses of the Borrower and its
Subsidiaries for such period: (i) depreciation expense; (ii) amortization
expense (including all amortization expenses recognized in accordance with APB
16 and 17 but excluding all other amortization of programming and production
costs); and (iii) in the event that, during such period, the Borrower or any of
its Subsidiaries acquires all or substantially all of the assets or Equity of
any other Person or any Equity in any other Person that is reported on an equity
basis, the EBITDA of such Person, as determined in accordance with the terms of
this definition, shall be included in the EBITDA of the Borrower for all Fiscal
Quarters during such period, less the proportional EBITDA of the interests held
by any other Person in entities fully consolidated with the Borrower and its
Subsidiaries, as determined in accordance with the terms of this definition.
"Equity" means all shares, options, equity interests, general or
limited partnership interests, joint venture interests or participation or
other equivalents (regardless of how
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designated) of or in a corporation, partnership or other entity, whether voting
or non-voting, and including, without limitation, common stock, preferred
stock, purchase rights, warrants or options for any of the foregoing.
"Eurodollar Rate" means for each day of the applicable Interest
Period for such Loan, the rate of interest per annum determined by the
Administrative Agent of the Viacom Credit Facilities to be the offered rate per
annum at which deposits in dollars appears on the Telerate Page 3750 (or any
successor page) as of 11:00 A.M. (London Time), or in the event such offered
rate is not available from the Telerate Page, the average (rounded upward to
the nearest whole multiple of 1/16 of 1% per annum, if such percentage is not
such a multiple) of the rates offered by the principal office of each of the
Reference Banks (as defined in the Viacom Credit Facilities) in the London
interbank market at 11:00 A.M. (London time), two Banking Days before the first
day of such Interest Period for deposit in dollars in an amount substantially
equal to the aggregate of the Eurodollar Rate Loans to which such Interest
Period relates and for a period equal to such Interest Period.
"Eurodollar Rate Loan" means any Loan or portion thereof that bears
interest at a rate determined with reference to the Eurodollar Rate.
"Event of Default" is defined in Section 9.1.
"Final Loan Maturity Date" means December 31, 1998.
"Financing Debt" means:
(a) Indebtedness in respect of borrowed money;
(b) Indebtedness in respect of notes, debentures or
similar instruments;
(c) Indebtedness in respect of capitalized leases:
(d) Indebtedness in respect of the deferred purchase price
of assets (other than normal trade accounts payable in
the ordinary course of business);
(e) Indebtedness in respect of mandatory redemption or
dividend rights on capital stock (or other equity);
and
(f) Indebtedness in respect of unfunded pension
liabilities.
"Fiscal Quarter" means any three month period ending March 31, June
30, September 30 or December 31 of any fiscal year.
"Fiscal Year" means such twelve month period ending December 31.
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"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
practices as may be in general use by significant segments of the U.S.
accounting profession, which are applicable to the circumstances as of the date
of determination.
"Guarantee" means, with respect to the Company (or other specified
Person):
(a) any guarantee by the Company of the payment or performance of,
or any contingent obligation by the Company in respect of, any
Indebtedness or other obligation of any other Person:
(b) any other arrangement whereby credit is extended to a Person
on the basis of any promise or undertaking of the Company (including
any "comfort letter" or "keep well agreement" written by the
Company to a creditor or prospective creditor of such Person) to
(i) pay the Indebtedness of such Person, (ii) purchase an
obligation owed by such Person, (iii) pay for the purchase or lease
of assets or services regardless of the actual delivery thereof or
(iv) maintain the capital, working capital, solvency or general
financial condition of such Person, in each case whether or not
such arrangement is disclosed in the balance sheet of the Company
or referred to in a footnote thereto;
(c) any liability of the Company as a general partner of a
partnership in respect of Indebtedness or other obligations of such
partnership;
(d) any liability of the Company as a joint venturer of a joint
venture in respect of Indebtedness or other obligations of such
joint venture; and
(e) reimbursement obligations with respect to letters of credit,
surety bonds and other financial guarantees; provided, however,
that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The
amount of any Guarantee and the amount of Indebtedness resulting
from such Guarantee shall be the greater of (i) the amount which
should be carried on the balance sheet of the Guarantor in respect
of such Guarantee or (ii) the amount which should be carried on the
balance sheet of the obligor whose obligations were guaranteed in
respect of such obligations, in each case as determined in
accordance with GAAP.
"Guarantor" means the Company, the Borrowers and each other
Subsidiary of Company from time to time indicated as a Guarantor on the
signature pages to the Guaranty (or pursuant to a joinder thereto).
"Guaranty" means the Guaranty of even date hereof among Lender,
Borrowers and the other Guarantors, as from time to time in effect.
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"Indebtedness" of any Person means at any date, without
duplication, (i) all obligations of such Person for borrowed money (including,
without limitation, in the case of the Borrower, the obligations or the
Borrower for borrowed money under this Agreement), (ii) all obligations of such
Person to pay the deferred purchase price of Property or services, except as
provided below, (iii) all obligations or such Person as lessee under
Capitalized Leases, (iv) all Indebtedness of others secured by a Lien on any
Property of such Person, whether or not such indebtedness is assumed by such
Person, (v) all Indebtedness of others directly or indirectly guaranteed or
otherwise assumed by such Person, including any obligations of others endorsed
(otherwise than for collection or deposit in the ordinary course of business)
or discounted or sold with recourse by such Person, or in respect of which such
Person is otherwise directly or indirectly liable, including, without
limitation any Indebtedness in effect guaranteed by such Person through any
agreement (contingent or otherwise) to purchase, repurchase or otherwise
acquire such obligation or any security therefor, or to provide funds for the
payment or discharge of such obligation, or to maintain the solvency or any
balance sheet or other financial condition of the obligor of such obligation,
provided that Indebtedness of the Borrower and its Subsidiaries shall not
include (a) all obligations of such Person as issuer, customer or account party
under letters of credit or bankers' acceptances that are either drawn or that
back financial obligations that would otherwise be Indebtedness.
"Indemnified Party" is defined in Section 10.2.
"Interest Period" means: (a) in the case of Base Rate Loans, the
period commencing on the date such loans are made or on the date of conversion
from Eurodollar Rate Loans and ending on the last day of each fiscal quarter
and (b) with respect to any Eurodollar Rate Loan, any period, selected as
provided in Section 2.2, of one, two or three months commencing on any Banking
Day and ending on the corresponding date in the subsequent calendar month so
selected or, if such subsequent calendar month has no corresponding date, on
the last date of such subsequent calendar month); provided, however, with
respect to any Base Rate Loans or Eurodollar Rate Loans, that if any Interest
Period so selected would otherwise begin or end on a date which is not a
Banking Day, such Interest Period shall instead begin or end, as the case may
be, on the immediately preceding or succeeding Banking Day as determined by
Lender.
"Lender" means Viacom Inc. and its successors and assignees.
"Loan" or "Loans" means one or more of the Revolving Loans or the
Term Loan or any combination thereof.
"Margin Stock" means "margin stock" within the meaning of
Regulations G, T, U or X (or any successor provisions) of the Board of
Governors of the Federal Reserve System, or any regulations, interpretations or
rulings thereunder, all as from time to time in effect.
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"Material Adverse Change" means a material adverse change since
June 30, 1996 in the business, assets, financial condition, income or prospects
of the Company and its Subsidiaries (on a consolidated basis).
"Material Subsidiary" means a Subsidiary which acquires
substantially all of the stock or assets of a Borrower or a Subsidiary which
the parties agree is a Material Subsidiary.
"Net Worth" means, at anytime, as to the Borrower and its
subsidiaries on a consolidated basis (determined in accordance with GAAP), the
excess of total assets over (i) total liabilities as shown on the Borrower's
then most recent consolidated balance sheet.
"Notes" means the Revolving Note and the Term Note.
"Notice of Borrowing" is defined in Section 2.2.
"Notice of Continuation or Conversion" is defined in Section 4.1.
"Obligor" means the Company, each other Borrower, each other
Guarantor and each other Person guaranteeing or granting collateral to secure
any Credit Obligations.
"Person" means any corporation, association, partnership, joint
venture, company, business trust, trust, organization, business or government
or any governmental agency or political subdivision thereof.
"Pledge and Security Agreement" means the Pledge and Security
Agreement of even date hereof among Lender, Borrowers and the other Guarantors,
as from time to time in effect.
"Product" has the meaning assigned to that term in the Pledge and
Security Agreement.
"Product Rights" has the meaning assigned to that term in the
Pledge and Security Agreement.
"Revolving Loan" is defined in Section 2.1.
"Revolving Note" is defined in Section 2.3.
"Security Documents" means the Pledge and Security Agreement, the
Guaranty, the Copyright Mortgages and Assignments, and any other present or
future agreements, instruments or documents from time to time between any
Borrower, any other Guarantor, any of their respective Subsidiaries or
Affiliates, or any other Person and Lender relating to the guaranty of or
pledge of a security interest or assignment to secure the payment and
performance of the Credit Obligations, as such agreements, instruments or
documents are from time to time in effect.
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"Stated Amount of Revolving Credit" means, at any date, the lesser
of (a) One Hundred and Fifty-five Million Dollars ($155,000,000) or (b) such
lesser amount (in an integral multiple of $1,000,000) specified by irrevocable
written notice from the Borrowers to the Lender permanently reducing the Stated
Amount of Revolving Credit.
"Subsidiary" of any Person means any other Person of which such
Person or other specified Person shall at the time, directly or indirectly
through one or more of its Subsidiaries, (a) own at least 50% of the outstanding
capital stock (or other shares of beneficial interest) entitled to vote
generally, (b) hold at least 50% of the partnership, joint venture or similar
interests or (c) be a general partner or joint venturer; provided, however, that
the term Subsidiary shall not include any joint venture.
"Term Loan" is defined in Section 3.1.
"Term Note" is defined in Section 3.2.
"Total Debt" of the Borrower and its Subsidiaries means, on any
date, the total outstanding Indebtedness of the Borrower and its Subsidiaries
on a consolidated basis.
"Trademark Mortgages and Assignments" has the meaning assigned to
that term in the Pledge and Security Agreement.
"UCC" means the Uniform Commercial Code as in effect in New York on
the date hereof.
"Unused Availability" means, at any date, the excess of the Stated
Amount of Revolving Credit over the Revolving Loan.
"Viacom Credit Facilities" means (i) the $6,489 Billion Credit
Agreement dated as of July 1, 1994, as amended from time to time, among Viacom
Inc. and the banks named therein; (ii) the $1.8 Billion Credit Agreement, dated
as of September 29, 1994, as amended from time to time, among Viacom Inc. and
the banks named therein; (iii) any successor credit facilities obtained by
Viacom.
ARTICLE II
AMOUNT AND TERMS OF REVOLVING CREDIT
2.1. Revolving Loans. Subject to all of the terms and conditions
of this Agreement and so long as no Default exists, the Lender will make loans
to the Borrowers, who shall borrow on a joint and several basis, from time to
time prior to the Commitment Termination Date, in an
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aggregate principal amount equal to the amount requested in accordance with
Section 2.2 but not to exceed at any time an aggregate amount equal to Stated
Amount of Revolving Credit then in effect. The aggregate principal amount of
the loans made pursuant to this Section 2.1 at any time outstanding is referred
to as the "Revolving Loan".
2.2. Borrowing Requests. Revolving Loans will be made to the
Borrowers by the Lender under Section 2.1 on any Banking Day prior to the
Commitment Termination Date. With respect to Eurodollar Rate Loans, not later
than noon (New York time) on the fourth Banking Day prior to the requested
Closing Date for any such Loan, and with respect to Base Rate Loans, not later
than noon (New York time) on the second Banking Day prior to the requested
Closing Date for any such Loan, Company, for and on behalf of all the
Borrowers, will give the Lender notice (either written notice, or telephonic
notice promptly confirmed in writing) of their request (a "Notice of
Borrowing") specifying (a) the amount of the requested loan (not less than
$1,000,000 and in integral multiples of $500,000), (b) whether such Loan shall
be a Base Rate Loan or a Eurodollar Rate Loan, (c) the requested Closing Date
therefor, and (d) with respect to Eurodollar Rate Loans the requested Interest
Period; provided that (i) Interest Periods shall be selected so that there
shall be no more than five (5) Interest Periods outstanding at any time; (ii)
no Interest Period with respect to any Revolving Loan shall expire later than
the Commitment Termination Date; and (iii) in the event Borrowers fail to
specify an Interest Period for any Revolving Loan in the applicable Notice of
Borrowing, Borrowers shall be deemed to have selected an Interest Period of one
month.
2.3. Revolving Note. The Revolving Loan shall be evidenced by a
promissory note in substantially the form of Exhibit 2.3 (the "Revolving Note")
payable by the Borrowers (on a joint and several basis) to the order of the
Lender.
2.4. Application of Proceeds.
(a) The Borrowers will apply the proceeds of the Revolving Loan for
working capital and for other general corporate purposes of the
Company and its Subsidiaries.
(b) The Borrowers will not, directly or indirectly, apply any part
of the proceeds of any extension of credit made pursuant to the
Credit Documents to purchase or to carry Margin Stock or to any
transaction prohibited by any laws or regulations applicable to the
Borrowers.
ARTICLE III
THE TERM LOAN
3.1. Term Loan. On the terms and subject to the conditions
contained in this Agreement, the Lender agrees to make a term loan to the
Borrower on the Closing Date in an
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amount of Two Hundred Million Dollars ($200,000,000). The aggregate principal
amount of the loan made pursuant to Section 3.1 of the Credit Agreement at any
time outstanding is referred to as the "Term Loan".
3.2 Term Note. On the Closing Date, the Borrowers shall deliver to
Lender a promissory note in substantially the form of Exhibit 3.2 (the "Term
Note") payable by the Borrowers (on a joint and several basis) to the order of
the Lender.
3.3. Virgin Term Loan. At the point when that certain credit
facility between Bank of America NT&SA and Virgin Interactive Entertainment,
Inc. (the "Virgin Facility") becomes due and payable and has not otherwise been
refinanced, the Lender shall make a term loan to the Borrower in an amount equal
to One Hundred Million Dollars ($100,000,000) or, if less, the amount
outstanding under the Virgin Facility on the terms and subject to the conditions
contained in this Agreement. The proceeds from this term loan shall be used by
the Borrower to repay all amounts outstanding under the Virgin Facility.
3.4. Virgin Term Note. Upon the making of the Virgin Term Loan,
the Borrowers shall deliver to Lender a promissory note substantially similar
in form to the Term Note payable by the Borrowers (on a joint and several
basis) to the order of the Lender.
ARTICLE IV
CONVERSION, INTEREST, PAYMENTS, FEES, ETC.
4.1. Conversion/Continuation Option. The Borrower may elect (i) at
any time to convert Base Rate Loans or any portion thereof to Eurodollar Rate
Loans or (ii) at the end of any Interest Period with respect thereto, to convert
Eurodollar Rate Loans or any portion thereof into Base Rate Loans, or to
continue such Eurodollar Rate Loans or any portion thereof as Eurodollar Rate
Loans for an additional Interest Period; provided, however, that the aggregate
of the Eurodollar Rate Loans of the Borrower so converted or so continued for
each Interest Period must be not less than $1,000,000 and in integral multiples
of $500,000 in excess thereof. Each such election (a "Notice of Conversion or
Continuation") shall be made by giving the Lender at least two Banking Days, in
the case of a conversion to or a continuation of a Base Rate Loan, and four
Banking Days, in the case of a conversion to or a continuation of a Eurodollar
Rate Loan, prior written notice thereof specifying (A) the amount and type of
conversion or continuation, (B) in the case of a conversion to or a continuation
of Eurodollar Rate Loans, the Interest Period therefor, and (C) in the case of a
conversion, the date of conversion (which date shall be a Banking Day and, if a
conversion from a Eurodollar Rate Loan, shall also be the last day of the
Interest Period therefor). Notwithstanding the foregoing, no conversion in
whole or in part of Base Rate Loans to Eurodollar Rate Loans, and no
continuation in whole or in part of Eurodollar Rate Loans upon the expiration of
any Interest Period therefor, shall be permitted at any time at which an Event
of Default shall have occurred and be continuing. If, within the time
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period required under the terms of this Section 4.1, the Lender does not
receive a Notice of Conversion or Continuation from the Borrower containing an
election to continue all or any portion of the Eurodollar Rate Loans for an
additional Interest Period or to convert all or any portion of such Loans,
then, upon the expiration of the Interest Period therefor, such Loans or the
portions thereof for which an election to continue or convert has not been made
will be automatically continued for a period of one month. Each Notice of
Conversion or Continuation shall be irrevocable. In the case of immediately
successive Interest Periods applicable to a Eurodollar Rate Loan continued
pursuant to a Notice of Conversion or Continuation (or in the absence of a
Notice of Conversion or Continuation as provided in this Section 4.1) each
successive Interest Period shall commence on the day on which the next
preceding Interest Period expires.
4.2. Interest. The Borrower shall pay interest on the unpaid
principal amount of each Loan from the date thereof until the principal amount
thereof shall be paid in full, at the following rates per annum, on such dates
as specified below (each a "Payment Date"):
(a) Base Rate Loans. For Base Rate Loans, at a rate per annum
equal at all times to the Base Rate in effect from time to time, payable
quarterly in arrears on the last day of September, December, March and June, on
the Final Loan Maturity Date and on the date any Base Rate Loan is converted or
paid in full.
(b) Eurodollar Rate Loans. For Eurodollar Rate Loans, at a rate
per annum equal at all times during the Interest Period for each Eurodollar
Rate Loan to the sum of the Eurodollar Rate for such Interest Period plus the
Applicable Eurodollar Rate Margin, payable in arrears on the last day of such
Interest Period.
4.3. Interest on Overdue Amounts. The Borrowers will on demand pay
daily interest (including post-petition interest in any proceeding under
applicable bankruptcy laws) on any overdue installments of principal and, to
the extent not prohibited by applicable law, on any overdue installments of
interest and fees owed under any Credit Document at a rate per annum which
equals the sum of 2% plus the highest Applicable Rate then in effect.
4.4. Limitation by Applicable Law. Anything in this Agreement or
the Notes to the contrary notwithstanding, the interest rates on the Loans
shall in no event be in excess of the maximum permitted by applicable law.
4.5. Commitment Fees. In consideration of the Lender's commitments
to make the extensions of credit provided for in Section 2, while such
commitments are outstanding, the Borrowers jointly and severally will pay to
the Lender, quarterly in arrears on the last day of each fiscal quarter, a
commitment fee equal to daily interest at the rate of .375% per annum on the
amount by which (a) the daily Stated Amount of Revolving Credit during the
three-month period or portion thereof ending on such date exceeded (b) the
daily Revolving Loans outstanding during such period or portion thereof;
provided, however that such commitment fee shall be reduced or increased to
correspond with any reductions or increases in the commitment fees payable by
Lender to its lenders under the Viacom Credit Facilities.
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4.6. Facility Fee. Borrowers (jointly and severally) agree to pay
to Lender, payable annually on January 31 of each year, a facility fee equal to
One Hundred and Fifty Thousand Dollars ($150,000) per annum. If Borrowers
permanently and irrevocably terminate Lender's obligations to make the
Revolving Loans and Term Loan hereunder and Borrowers repay all Credit
Obligations hereunder and under the other Credit Documents, then Lender agrees
to repay to Borrowers a portion of the annual facility fee paid to Lender
pursuant to this Section 4.6 with respect to the applicable one year period,
pro-rated on the basis of a 360-day year for the actual number of days
remaining in the year.
4.7. Annual Administrative Fee. Borrowers (jointly and
severally) agree to pay Lender an annual administrative fee equal to $15,000 on
January 31 of each year prior to the Commitment Termination Date.
4.8. Computations of Interest and Fees. For purposes of this
Agreement, all computations of the Commitment Fee or of interest based on the
rate of interest specified in clause (i) of the definition of Base Rate shall
be made on the basis of a year of 365 or 366 days as the case may be, and all
computations of interest based on the Eurodollar Rate or clause (ii) of the
definition of Base Rate shall be made on the basis of a year of 360 days, in
each case for the actual number of days (including the first day but excluding
the last day) occurring in the period for which such interest and fees are
payable; provided that if a Loan is repaid on the same day on which it is made,
one day's interest shall be paid on that Loan.
4.9. Break-Funding Costs. If Lender receives any payment of
principal of, or is subject to a conversion of, any Eurodollar Rate Loan other
than on the last day of an Interest Period relating to such Loan, as a result
of any payment or conversion made by the Borrower or acceleration of the
maturity of the amounts due under this Agreement pursuant to Section 9.2(c) or
for any other reason, the Borrower shall, upon demand by Lender, pay to the
Lender any amounts required to compensate Lender for any additional losses,
costs or expenses which it may reasonably incur as a result of such payment or
conversion, including, without limitation, any loss (excluding any loss of the
margin payable in accordance with Section 4.2(b) on the amount of principal so
paid, or any loss), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by Lender to fund or maintain
such Loan. The obligations of the Borrower contained in this Section 4.9 shall
survive payment of the Loans.
ARTICLE V
PAYMENTS
5.1. Payment at Maturity. On the stated or any accelerated
maturity of the Notes, the Borrowers will pay to the Lender for credit to the
applicable Note an amount equal to the
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principal evidenced by the applicable Note then due, together with all accrued
and unpaid interest thereon and all other Credit Obligations in respect thereof
then outstanding.
5.2. Prepayments.
(a) Contingent Required. If at any time the aggregate of the
Revolving Loans outstanding exceeds the Stated Amount of Revolving
Credit then in effect, the Borrowers will promptly pay the amount of
such excess to Lender.
(b) Voluntary Prepayments. In addition to the prepayments
required by Section 5.2(a), the Borrowers may from time to time prepay
all or any portion of the Eurodollar Rate Loans or the Base Rate
Loans, without premium; provided, however, that any such prepayments
are made in accordance with Section 4.9 hereof and further provided
that the Borrower, making such a prepayment, shall give the Lender at
least four (4) Banking Days', in the case of Eurodollar Rate Loans, or
two (2) Banking Days', in the case of Base Rate Loans, prior notice of
its intention to prepay, specifying the date of payment, the total
principal amount of the Loan to be paid on such date and the amount
of interest to be paid with such prepayment.
5.3. Reborrowings. The amounts of the Revolving Loan repaid or
prepaid pursuant to Section 5.2(b) may be reborrowed from time to time prior to
the Commitment Termination Date in accordance with Section 2. Amounts of the
Term Loan repaid or prepaid pursuant to Section 5.2(b) may not be reborrowed.
5.4. Payment with Accrued Interest. Upon all prepayments of the
Loans, the Borrower making the prepayment shall pay to the Lender the principal
amount to be prepaid together with unpaid interest in respect thereof accrued
to the date of prepayment. Notice of prepayment having been given in
accordance with Section 5.2(b) and whether or not notice is given of
prepayments pursuant to Section 5.2(a), the amount specified to be prepaid
shall become due and payable on the date specified for prepayment.
5.5. Payments.
(a) The Borrowers shall make each payment of principal, interest
and fees hereunder and under the Notes, without defense, setoff or
counterclaim, not later than 12 noon, New York time, on the day when
due in lawful money of the United States of America to the Lender at
an account of the Lender designated from time to time in immediately
available funds.
(b) Whenever any payment to be made hereunder or under the Notes
shall be stated to be due on a day that is not a Banking Day, such
payment may be made on the next succeeding Banking Day, and with
respect to payments of principal, interest thereon shall be payable at
the then applicable rate during such extension.
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ARTICLE VI
CONDITIONS OF LENDING
6.1 Conditions to Each Extension of Credit. The obligations of
Lender to make any Loan pursuant to Section 2 shall be subject to the
satisfaction, on or before the Closing Date for such Loan, of the following
conditions:
(a) Proper Proceedings. This Agreement, each other Credit Document
and the transactions contemplated hereby and thereby shall have been
authorized by all necessary proceedings of each Obligor and any of
their respective Affiliates party thereto. All necessary consents,
approvals and authorizations of any governmental or administrative
agency or any other Person of any of the transactions contemplated
hereby or by any other Credit Document shall have been obtained and
shall be in full force and effect. Lender shall have received copies
of all documents that Lender may have reasonably requested in
connection with the foregoing.
(b) No Default. No Default shall have occurred and be continuing,
or would result from such borrowing.
(c) Representations and Warranties. All representations and
warranties contained in this Agreement and the other Credit Documents
shall be true and correct in all material respects on the date of such
Loan to the same extent as though made on and as of that date.
ARTICLE VII
COVENANTS
7.1. Minimum Net Worth. On the last day of each Fiscal Quarter,
commencing September 30, 1996, the Net Worth of the Borrower and its
Subsidiaries shall not be less than 75% of the Net Worth of the Borrower and
its Subsidiaries as of June 30, 1996.
7.2 Compliance Statement. The Borrower shall furnish to the
Lender a certificate issued by a Authorized Officer of the Borrower (i)
demonstrating compliance at the end of the accounting period described in such
statements with the financial covenants contained herein and (ii) containing
in reasonable detail the component figures contained in the respective total
figures stated in such certificate.
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7.3. Non-Borrower Subsidiaries. Each of the Borrowers covenants
that, until all of the Credit Obligations shall have been paid in full and
until Lender's commitments to extend credit under this Agreement and any other
Credit Document shall have been irrevocably terminated, it and its respective
present and future Subsidiaries will cause any present and future Material
Subsidiary to become a Borrower hereunder (other than a Material Subsidiary
organized under the laws of a jurisdiction outside of the United States) by
executing a joinder to this Agreement, the Security Documents and such other
documents as the Lender may reasonably request.
7.4. Disposition of Assets. Neither the Company, the Borrowers nor
any Material Subsidiary will sell, lease, license, convey or otherwise dispose
of, in one transaction or a series of transactions, all or a substantial part
of its business or assets whether now owned or hereafter acquired; provided,
however, that Company and its Subsidiaries may sell, distribute or otherwise
exploit Product and Product Rights in the ordinary course of business.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
8.1. Borrower's Representations and Warranties. In order to induce
the Lender to extend credit to the Borrowers hereunder, each of the Borrowers
jointly and severally represents and warrants that:
(a) Organization, Etc. Each Borrower is a duly organized and
validly existing corporation, in good standing under the laws of the
state of its incorporation, with all power and authority, corporate or
otherwise, necessary to (a) enter into and perform this Agreement and
each other Credit Document to which it is party, (b) guarantee the
Credit Obligations, (c) grant the Lender the security interests in
the Credit Security owned by it to secure the Credit Obligations and
(d) own its properties and carry on the business now conducted or
proposed to be conducted by it. Each Borrower has taken all corporate
action required to execute, deliver and perform this Agreement and
each other Credit Document to which it is party.
(b) No Legal Obstacle to Agreements. Neither the execution and
delivery of this Agreement or any other Credit Document, nor the
making of any borrowings hereunder, nor the guaranteeing of the Credit
Obligations, nor the securing of the Credit Obligations with the
Credit Security, nor the fulfillment of the terms hereof or of any
other Credit Document, has constituted or resulted in or will
constitute or result in:
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(i) any breach or termination of the provisions of any
agreement, instrument, deed or lease to which the Company or
any of its Subsidiaries is a party or by which it is bound;
(ii) the violation of any law, statute, judgment, decree
or governmental order, rule or regulation applicable to the
Company or any of its Subsidiaries;
(iii) the creation under any agreement, instrument, deed or
lease of any Lien (other than Liens on the Credit Security
which secure the Credit Obligations) upon any of the assets of
the Company or any of its Subsidiaries; or
(iv) any redemption, retirement or other repurchase
obligation of the Company or any of its Subsidiaries under any
Articles, By-law, agreement, instrument, deed or lease.
Other than filings to perfect the security interests in the Credit Security, no
approval, authorization or other action by, or declaration to or filing with,
any governmental or administrative authority or any other Person is required to
be obtained or made by the Company or any Subsidiary in connection with the
execution, delivery and performance of this Agreement, the Notes or any other
Credit Document, or the making of any borrowing hereunder.
(c) Defaults. Neither the Company nor any of its Subsidiaries is
in default under any provision of its Articles or By-laws or of this
Agreement or any other Credit Document. Neither the Company nor any
of its Subsidiaries is in default under any provision of any
agreement, instrument, deed or lease to which it is party or by which
it or its property is bound, or has violated any law, judgment, decree
or governmental order, rule or regulation, in each case, so as to
result, or pose a material risk of resulting, in any Material Adverse
Change.
(d) Validity. Each of the Credit Documents has been duly executed
and delivered by each Obligor and is the legally valid and binding
obligation of each Obligor, enforceable against each Obligor in
accordance with its respective terms; except in each case as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, liquidation, moratorium or other similar laws of
general application and equitable principles relating to or affecting
creditors' rights.
(e) No Material Adverse Change. No event or change has occurred
that represents, either in any case or in the aggregate, a Material
Adverse Change.
8.2. Lender's Representations and Warranties. In order to
induce the Borrowers to enter into this Agreement and the other Credit
Documents. Lender represents and warrants that:
(a) Organization, Etc. Lender is a duly organized and validly
existing corporation, in good standing under the laws of the state of
its incorporation, with all power and
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authority, corporate or otherwise, necessary to enter into and perform
this Agreement and each other Credit Document to which it is party.
Lender has taken all corporate action required to execute, deliver and
perform this Agreement and each other Credit Document to which it is
party.
(b) Validity. Each of the Credit Documents to which Lender is a
party has been duly executed and delivered by Lender and is the
legally valid and binding obligation of Lender, enforceable against
Lender in accordance with its respective terms, except in each case as
such enforceability may be limited by bankruptcy, insolvency,
reorganization, liquidation, moratorium or other similar laws of
general application and equitable principles relating to or affecting
creditors' rights.
ARTICLE IX
EVENTS OF DEFAULT
9.1. Events of Default. The following events are referred to as
"Events of Default":
(a) Any Borrower shall fail to make any payment in respect of: (a)
interest on any of the Credit Obligations owed by it as the same shall
become due and payable, and such failure shall continue for a period
of five consecutive days, or (b) any fee on, or any expense or
indemnity in respect of, any of the Credit Obligations as the same
shall become due and payable and such failure shall continue for a
period of five consecutive days after notice thereof by the Lender to
the Company, or (c) principal of any of the Credit Obligations owed by
it as the same shall become due, whether at maturity or by
acceleration or otherwise.
(b) The Company or any of its Subsidiaries or any of their
respective Affiliates party to any Credit Document shall fall to
perform or observe any other covenant. agreement or provision to be
performed or observed by it under this Agreement or any other Credit
Document, and such failure shall, not be cured within 30 days after
notice thereof by Lender to the Company.
(c) Any material representation or material warranty of or with
respect to the Company, any of its Subsidiaries or any of their
respective Affiliates party to any Credit Document made to Lender in,
pursuant to or in connection with this Agreement or any other Credit
Document shall be materially false on the date as of which it was
made.
(d) The Company or any of its Subsidiaries shall fail to make any
payment when due (after giving effect to any applicable grace periods)
in respect of any Financing Debt
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(other than the Credit Obligations) outstanding in an aggregate amount
of principal and accrued and unpaid interest exceeding $1,000,000:
(e) The Company or any of its Subsidiaries shall fail to perform
or observe the terms of any agreement relating to such Financing Debt,
and such failure or condition shall continue, without having been duly
cured, waived or consented to, beyond the period of grace, if any,
specified in such agreement, and such failure or condition shall
permit the acceleration of such Financing Debt in an aggregate amount
of principal and accrued and unpaid interest exceeding $1,000,000;
(f) Any such Financing Debt of the Company or any of its
Subsidiaries in an aggregate amount of principal and accrued and
unpaid interest exceeding $1,000,000 shall be accelerated or become
due or payable prior to its stated maturity for any reason whatsoever
(other than voluntary prepayments thereof);
(g) Any lien on any property of the Company or any of its
Subsidiaries securing any such Financing Debt in an aggregate amount
of principal and accrued and unpaid interest exceeding $1,000,000
shall be enforced by foreclosure or similar action, or
(h) Any holder of any such Financing Debt in an aggregate amount
of principal and accrued and unpaid interest exceeding $1,000,000
shall exercise any right of rescission with respect to the issuance
thereof.
(i) Any Credit Document shall cease, for any reason (other than
the scheduled termination thereof in accordance with its terms), to be
in full force and effect: or the Company, any of its Subsidiaries or
any of their respective Affiliates party thereto shall so assert in a
judicial or similar proceeding; or the security interests created by
this Agreement and the other Credit Documents shall cease to be
enforceable and of the same effect and priority purported to be
created hereby, except solely as a result of failure by the Lender to
file continuation statements with respect to financing statements or
to take other similar administrative steps within its sole control.
(j) A final judgment:
(i) which, with other outstanding final judgments against
the Company and any of its Subsidiaries, exceeds an aggregate
of $3,000,000 shall be rendered against the Company or any of
its Subsidiaries or Affiliates party to any Credit Document, or
(ii) which grants injunctive relief that results in, or
poses a material risk of resulting in, a Material Adverse
Change shall be rendered.
and if, within 60 days after entry thereof, such judgment shall not
have been discharged or execution thereof stayed pending appeal, or
if, within 60 days after the expiration of any such stay, such
judgment shall not have been discharged.
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(k) The Company, any of its Material Subsidiaries or any of their
respective Affiliates obligated with respect to any Credit Obligation
shall:
(i) commence a voluntary case under the Bankruptcy Code
or authorize, by appropriate proceedings of its board of
directors or other governing body, the commencement of such a
voluntary case;
(ii) have filed against it a petition commencing an
involuntary case under the Bankruptcy Code which shall not
have been dismissed within 60 days after the date on which
such petition is filed; or file an answer or other pleading
within such 60-day period admitting or failing to deny the
material allegations of such a petition or seeking, consenting
to or acquiescing in the relief therein provided;
(iii) have entered against it an order for relief in any
involuntary case commenced under the Bankruptcy Code;
(iv) seek relief as a debtor under any applicable law,
other than the Bankruptcy Code, of any jurisdiction relating
to the liquidation or reorganization of debtors, or to the
modification or alteration of the rights of creditors, or
consent to or acquiesce in such relief;
(v) have entered against it an order by a court of
competent jurisdiction (i) finding it to be bankrupt or
insolvent, (ii) ordering or approving its liquidation,
reorganization or any modification or alteration of the rights
of its creditors or (iii) assuming custody of, or appointing a
receiver or other custodian for, all or a substantial portion
of its property; or
(vi) make an assessment for the benefit of, or enter into
a composition with, its creditors, or appoint, or consent to
the appointment of, or suffer to exist a receiver or other
custodian for, all or a substantial portion of its property.
(l) Lender and its Affiliates shall cease to beneficially own and
control a majority of the issued and outstanding shares of capital
stock of Company entitled (without regard to the occurrence of any
contingency) to vote for the election of members of the board of
directors of Company.
(m) Lender shall fail to make any payment when due in respect of or
should otherwise be in breach or default of (in each case, after giving
effect to any applicable grace period) the Viacom Credit Facilities.
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9.2. Certain Actions Following an Event of Default. If any one or
more Events of Default shall occur and be continuing, then in each and every
such case:
(a) No Obligation to Extend Credit. Lender may terminate the
obligations of Lender to make any further extensions of credit under
the Credit Documents by furnishing notice thereof to the Borrowers;
provided, however, that the obligations of Lender to make any further
extensions of credit under the Credit Documents shall automatically
terminate without notice to the Borrowers upon the occurrence of a
Bankruptcy Default.
(b) Specific Performance: Exercise of Rights. Lender may proceed
to protect and enforce Lender's rights by suit in equity, action at
law and/or other appropriate proceeding, either for specific
performance of any covenant or condition contained in this Agreement
or any other Credit Document or in any instrument or assignment
delivered to the Lender pursuant to this Agreement or any other Credit
Document, or in aid of the exercise of any power granted in this
Agreement or any other Credit Document or any such instrument or
assignment.
(c) Acceleration. Lender may, by notice in writing to the
Borrowers, declare all or any part of the unpaid balance of the Credit
Obligations then outstanding to be immediately due and payable, and
thereupon such unpaid balance or part thereof shall become so due and
payable without presentation, protest or further demand or notice of
any kind, all of which are hereby expressly waived; provided, however,
that if a Bankruptcy Default shall have occurred, the unpaid balance
of the Credit Obligations shall automatically become immediately due
and payable; provided, however, that if an Event of Default described
in Section 9.1(m) has occurred and is continuing but at the applicable
time of determination the Indebtedness incurred under the Viacom
Credit Facilities has not been accelerated, then Lender may not by
reason of such Event of Default, declare all or any part of the unpaid
balance of the Credit Obligations then outstanding to be immediately
due and payable until such time, if ever, that the Indebtedness under
the Viacom Credit Facilities is accelerated.
(d) Enforcement of Payment; Setoff. Lender may proceed to enforce
payment of the Credit Obligations in such manner as it may elect and
to realize upon any and all rights in the Credit Security. Lender may
offset and apply toward the payment of the Credit Obligations (and/or
toward the curing of any Event of Default) any Indebtedness from
Lender to the respective Obligors, regardless of the adequacy of any
security for the Credit Obligations. Lender shall have no duty to
determine the adequacy of any such security in connection with any
such offset.
(e) Cumulative Remedies. To the extent not prohibited by
applicable law which cannot be waived, all of the Lender's rights
hereunder and under each other Credit Document Shall be cumulative.
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9.3. Annulment of Defaults. Any Default or Event of Default shall
be deemed to exist and to be continuing for any purpose of this Agreement until
such Default or Event of Default has been completely cured in every respect or
the Lender shall have waived such Default or Event of Default in writing or
entered into an amendment to this Agreement which by its express terms cures
such Default or Event of Default. No such action by the Lender shall extend to
or affect any subsequent Default or Event of Default or impair any rights of the
Lender upon the occurrence thereof. The making of any extension of credit
during the existence of any Default or Event of Default shall not constitute a
waiver thereof.
9.4. Waivers. Each of the Borrowers waives to the extent not
prohibited by the provisions of applicable law that cannot be waived:
(a) all presentments, demands for performance, notices of
nonperformance (except to the extent required by the
provisions of this Agreement or any other Credit Document),
protests, notices of protest and notices of dishonor;
(b) any requirement of diligence or promptness in the
part of Lender in the enforcement of its rights under this
Agreement, the Notes or any other Credit Document;
(c) any and all notices of every kind and description
which may be required to be given by any statute or rule of
law.
ARTICLE X
MISCELLANEOUS
10.1. Expenses. Whether or not the transactions contemplated hereby
shall be consummated (unless such transactions are not consummated solely by
reason of the gross negligence or willful misconduct of Lender), the Borrowers
will pay:
(a) all reasonable expenses of Lender (including the
reasonable fees, expenses and disbursements of counsel to
Lender including allocated costs of internal counsel) in
connection with the preparation, negotiation, execution,
delivery and administration of this Agreement, each other
Credit Document, the transactions contemplated hereby and
thereby and operations hereunder and thereunder;
(b) all recording and filing fees and transfer and
documentary stamp and similar taxes at any time payable in
respect of this Agreement, any other
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Credit Document, any Credit Security or the incurrence of the
Credit Obligations; and
(c) to the extent not prohibited by applicable law that
cannot be waived, all other reasonable expenses incurred by
Lender or the holder of any Credit Obligation in connection
with the enforcement of any rights hereunder or under any
other Credit Document, including costs of collection and
reasonable attorneys' fees (including a reasonable allowance
for the hourly cost of attorneys employed by Lender on a
salaried basis) and expenses.
10.2. General Indemnity. The Borrowers will, jointly and severally,
indemnify Lender and hold Lender harmless from any liability, loss or damage
resulting from the violation by the Borrowers of Section 2.4. The Borrowers
will also, jointly and severally, indemnify Lender, each of the Lender's
directors, officers, employees, attorneys, and Affiliates and each Person, if
any, who controls Lender (Lender and each of such directors, officers,
employees and Affiliates and control Persons is referred to as an "Indemnified
Party") and hold each of them harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, claims, costs, expenses and disbursements of any kind or nature
whatsoever (including, without limitation, the reasonable fees and
disbursements of counsel (including allocated costs of internal counsel) for
such Indemnified Party in connection with any investigative, administrative or
judicial proceeding commenced or threatened, whether or not such Indemnified
Party shall be designated a party thereto), that may be imposed on, incurred
by, or asserted against that Indemnified Party, in any manner relating to or
arising out of this Agreement or the other Credit Documents, Lender's agreement
to make the Loans as provided herein, or the use or intended use of the
proceeds of any of the Loans hereunder (the "Indemnified Liabilities");
provided that Borrowers shall have no obligation to an Indemnified Party
hereunder with respect to Indemnified Liabilities arising from (i) the gross
negligence or willful misconduct of that Indemnified Party or (ii) an
investigative proceeding related primarily to the activities of Lender. To the
extent that the undertaking to indemnify, pay and hold harmless set forth in
the preceding sentence may be unenforceable because it is violative of any law
or public policy, and Borrower shall contribute the maximum portion that it is
permitted to pay and satisfy under applicable law, to the payment and
satisfaction of all Indemnified Liabilities incurred by the Indemnified Parties
or any of them. The indemnities contained in this subsection shall survive the
termination of the other provisions of this Agreement, shall constitute
separate and independent obligations of each Borrower from its other
obligations under this Agreement and shall give rise to separate and
independent causes of action against each Borrower.
10.3. Successors and Assigns. Any reference in this Agreement to
any of the parties hereto shall be deemed to include the successors and assigns
of such party, including without limitation any assignee or transferee of any
of the Loans, and all covenants and agreements by or on behalf of the Borrowers
or Lender that are contained in this Agreement shall bind and inure to the
benefit of their respective successors and assigns; provided, however, that the
Company and its Subsidiaries may not assign their rights or obligations under
this Agreement.
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10.4. Notices. Except as otherwise specified in this Agreement, any
notice required to be given pursuant to this Agreement shall be given in
writing. Any notice, demand or other communication in connection with this
Agreement shall be deemed to be given if given in writing (including telex,
telecopy or similar teletransmission) addressed as provided below (or to the
addressee at such other address as the addressee shall have specified by notice
actually received by the addresser), and if either (i) actually delivered in
fully legible form to such address (evidenced in the case of a telex by receipt
of the correct answer back) or (ii) in the case of a letter, five days shall
have elapsed after the same shall have been deposited in the United States
mails, with first-class postage prepaid and registered or certified.
(a) If to the Company or any of its Subsidiaries, to it in care of
the Company at its address set forth on the signature page hereof, to
the attention of the chief financial officer.
(b) If to Lender, to it at its address set forth on the signature
page of this Agreement, to the attention of the chief financial
officer with a copy to the assistant treasurer and director of cash
management.
10.5. Course of Dealing; Amendments and Waivers. No course of
dealing between Lender, on one hand, and the Company or any of its Subsidiaries
or their respective Affiliates, on the other hand, shall operate as a waiver of
any of Lender's rights under this Agreement or any other Credit Document or
with respect to the Credit Obligations. Each of the Company and its
Subsidiaries acknowledges that if the Lender, without being required to do so
by this Agreement or any other Credit Document, gives any notice or information
to, or obtains any consent from, any of the Company and its Subsidiaries or any
of their respective Affiliates, Lender shall not by implication have amended,
waived or modified any provision of this Agreement or any other Credit
Document, or created any duty to give any such notice or information or to
obtain any such consent on any future occasion. No delay or omission on the
part of Lender in exercising any right under this Agreement or any other Credit
Document or with respect to the Credit Obligations shall operate as a waiver of
such right or any other right hereunder or thereunder. A waiver on any one
occasion shall not be construed as a bar to or waiver of any right or remedy on
any future occasion. No waiver, consent or amendment with respect to this
Agreement or any other Credit Document shall be binding unless it is in writing
and signed by Lender.
10.6. Venue: Service of Process. Each of the Borrowers:
(a) Irrevocably submits to the nonexclusive jurisdiction of the
state and federal courts located in the States of New York and
California for the purpose of any suit, action or other proceeding
arising out of or based upon this Agreement or any other Credit
Document or the subject matter hereof or thereof.
(b) Waives to the extent not prohibited by applicable law, and
agrees not to assert, by way of motion, as a defense or otherwise,
in any such proceeding brought in any of
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29
the above-named courts. any claim that it is not subject personally to
the jurisdiction of such court, that its property is exempt or immune
from attachment or execution, that such proceeding is brought in an
inconvenient forum, that the venue of such proceeding is improper, or
that this Agreement or any other Credit Document, or the subject
matter hereof or thereof, may not be enforced in or by such court.
Each of the Borrowers and the Lender consents to service of process in any such
proceeding in any manner permitted by applicable state or federal law and
agrees that service of process by registered or certified mail, return receipt
requested, at its address specified in or pursuant to Section 10.4 is
reasonably calculated to give actual notice.
10.7. General. All covenants, agreements, representations and
warranties made in this Agreement or any other Credit Document or in
certificates delivered pursuant hereto or thereto shall be deemed to have been
relied on by Lender, notwithstanding any investigation made by Lender on its
behalf, and shall survive the execution and delivery to the Lender hereof and
thereof. The invalidity or unenforceability of any other provision hereof
shall not affect the validity or enforceability of any other provision hereof.
The headings in this Agreement are for convenience of reference only and shall
not limit or otherwise affect the meaning hereof. This Agreement and the other
Credit Documents constitute the entire understanding of the parties with
respect to the subject matter hereof and thereof and supersede all prior and
current understandings and agreements, whether written or oral. Sections 10.1
and 10.2 shall survive the termination of this Agreement. This Agreement may
be executed in any number of counterparts which together shall constitute one
instrument. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS (OTHER THAN THE CONFLICT OF LAWS RULES) OF THE STATE OF
NEW YORK.
10.8. Section Titles. The Section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.
10.9. Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
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30
IN WITNESS WHEREOF, each of the undersigned has caused this Agreement to be
executed and delivered by its duly authorized officer as an agreement under seal
as of the date first above written.
BORROWERS
SPELLING ENTERTAINMENT GROUP INC.
SPELLING ENTERTAINMENT INC.
XXXXX XXXXXXXX PRODUCTIONS, INC.
LAUREL ENTERTAINMENT, INC.
SPELLING FILMS INC.
SPELLING TELEVISION INC.
TORAND PRODUCTIONS INC.
WORLDVISION ENTERPRISES, INC.
XXXXXXXX PROJECTS, INC.
WILSHIRE ENTERTAINMENT INC.
SPELLING SATELLITE NETWORKS, INC.
BIG TICKET TELEVISION INC.
REPUBLIC ENTERTAINMENT INC.
REPUBLIC DISTRIBUTION CORPORATION
VIRGIN INTERACTIVE ENTERTAINMENT, INC.
VIE HOLDING COMPANY
WESTWOOD STUDIOS INC.
By: /S/ XXXXX XXXXXXXX
-----------------------------------------
XXXXX XXXXXXXX
As an authorized officer of each
of the foregoing corporations
Address: 0000 Xxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
LENDER
VIACOM INC.
By: /s/ XXXXXX X. XXXXXX
----------------------------------------
XXXXXX X. XXXXXX
Title: Senior Vice President, Treasurer
Address: 0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
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31
Exhibit 2.3.
REVOLVING NOTE
$155,000,000 as of September 30, 1996
FOR VALUE RECEIVED, each of the undersigned, Spelling Entertainment
Group Inc., a Delaware corporation (the "Company"), and certain of its
subsidiaries listed on the signature page hereof (together with the Company,
the "Borrowers"), jointly and severally, hereby promises to pay Viacom Inc.
(the "Lender") or order, on the Final Loan Maturity Date (as defined in the
Credit Agreement referred to below), the aggregate unpaid principal amount of
the loans made by the Lender to the Borrowers pursuant to the Credit Agreement.
The Borrowers jointly and severally promise to pay daily interest, computed as
provided in such Credit Agreement, on the aggregate principal amount of such
loans from time to time unpaid at the per annum rate applicable to such unpaid
principal amount as provided in such Credit Agreement and to pay interest on
overdue principal and, to the extent not prohibited by applicable law, on
overdue installments of interest and fees at the rate specified in such Credit
Agreement, all such interest being payable at the times specified in such
Credit Agreement, except that all accrued interest shall be paid at the stated
or accelerated maturity hereof or upon the prepayment in full hereof.
Payments hereunder shall be made to Lender at such account of Lender
as is specified by Lender in writing from time to time.
This Revolving Note evidences borrowings under, and is entitled to the
benefits and security of, and is subject to the provisions of, the Credit
Agreement dated as of September 30, 1996, as from time to time in effect (the
"Credit Agreement"), among the Borrowers and Lender and the Security Documents
(as defined in the Credit Agreement). The principal of this Revolving Note is
prepayable in the amounts and under the circumstances set forth in the Credit
Agreement, and may be prepaid in whole or from time to time in part, all as set
forth in the Credit Agreement. Terms defined in the Credit Agreement and not
otherwise defined herein are used herein with the meanings so defined.
In case an Event of Default shall occur and be continuing, the entire
principal of this Revolving Note may become or be declared due and payable in
the manner and with the effect provided in the Credit Agreement.
THIS REVOLVING NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS (OTHER THAN THE CONFLICT OF LAWS RULES) OF THE STATE OF NEW YORK.
The parties hereto including the Borrowers and all guarantors and
endorsers, hereby waive presentment, demand, notice, protest and all other
demands and notices in connection with the
32
delivery, acceptance, performance and enforcement of this Revolving Note,
except as specifically otherwise provided in the Credit Agreement, and assent
to extensions of time of payment, or forbearance or other indulgence without
notice.
BORROWERS
SPELLING ENTERTAINMENT GROUP INC.
SPELLING ENTERTAINMENT INC.
XXXXX XXXXXXXX PRODUCTIONS, INC.
LAUREL ENTERTAINMENT, INC.
SPELLING FILMS INC.
SPELLING TELEVISION INC.
TORAND PRODUCTIONS INC.
WORLDVISION ENTERPRISES, INC.
XXXXXXXX PROJECTS, INC.
WILSHIRE ENTERTAINMENT INC.
SPELLING SATELLITE NETWORKS, INC.
BIG TICKET TELEVISION INC.
REPUBLIC ENTERTAINMENT INC.
REPUBLIC DISTRIBUTION CORPORATION
VIRGIN INTERACTIVE ENTERTAINMENT, INC.
VIE HOLDING COMPANY
WESTWOOD STUDIOS INC.
By: /s/ XXXXX XXXXXXXX
---------------------------------
XXXXX XXXXXXXX
As an authorized officer of each
of the foregoing corporations
Address: 0000 Xxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
LENDER
VIACOM INC.
By: /s/ XXXXXX X. XXXXXX
---------------------------------
XXXXXX X. XXXXXX
Title: Senior Vice President, Treasurer
Address: 0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
33
Exhibit 3.2.
TERM NOTE
$200,000,000 as of September 30, 1996
FOR VALUE RECEIVE, each of the undersigned, Spelling Entertainment Group
Inc., a Delaware corporation (the "Company"), and certain of its subsidiaries
listed on the signature page hereof (together with the Company, the
"Borrowers"), jointly and severally, hereby promises to pay Viacom Inc. (the
"Lender") or order, on the Final Loan Maturity Date (as defined in the Credit
Agreement referred to below), the aggregate unpaid principal amount of the Term
Loan made by the Lender to the Borrowers pursuant to the Credit Agreement. The
Borrowers jointly and severally promise to pay daily interest, computed as
provided in such Credit Agreement, on the aggregate principal amount of such
loans from time to time unpaid at the per annum rate applicable to such unpaid
principal amount as provided in such Credit Agreement and to pay interest on
overdue principal and, to the extent not prohibited by applicable law, on
overdue installments of interest and fees at the rate specified in such Credit
Agreement, all such interest being payable at the times specified in such
Credit Agreement, except that all accrued interest shall be paid at the stated
or accelerated maturity hereof or upon the prepayment in full hereof.
Payments hereunder shall be made to Lender at such account of Lender
as is specified by Lender in writing from time to time.
This Term Note evidences borrowings under, and is entitled to the
benefits and security of, and is subject to the provisions of, the Credit
Agreement dated as of September 30, 1996, as from time to time in effect (the
"Credit Agreement"), among the Borrowers and Lender and the Security Documents
(as defined in the Credit Agreement). The principal of this Term Note is
prepayable in the amounts and under the circumstances set forth in the Credit
Agreement, and may be prepaid in whole or from time to time in part, all as set
forth in the Credit Agreement. Terms defined in the Credit Agreement and not
otherwise defined herein are used herein with the meanings so defined.
In case an Event of Default shall occur and be continuing, the entire
principal of this Term Note may become or be declared due and payable in the
manner and with the effect provided in the Credit Agreement.
THIS TERM NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS (OTHER THAN THE CONFLICT OF LAWS RULES) OF THE STATE
OF NEW YORK.
The Parties hereto including the Borrowers and all guarantors and
endorsers, hereby waive presentment, demand, notice, protest and all other
demands and notices in connection with
34
the delivery acceptance performance and enforcement of this Term Note, except
as specifically otherwise provided in the Credit Agreement, and assent to
extensions of time of payment, or forbearance or other indulgence without
notice.
BORROWERS
SPELLING ENTERTAINMENT GROUP INC.
SPELLING ENTERTAINMENT INC.
XXXXX XXXXXXXX PRODUCTIONS, INC.
LAUREL ENTERTAINMENT, INC.
SPELLING FILMS INC.
SPELLING TELEVISION INC.
TORAND PRODUCTIONS INC.
WORLDVISION ENTERPRISES, INC.
XXXXXXXX PROJECTS, INC.
WILSHIRE ENTERTAINMENT INC.
SPELLING SATELLITE NETWORKS, INC.
BIG TICKET TELEVISION INC.
REPUBLIC ENTERTAINMENT INC.
REPUBLIC DISTRIBUTION CORPORATION
VIRGIN INTERACTIVE ENTERTAINMENT, INC.
VIE HOLDING COMPANY
WESTWOOD STUDIOS INC.
By: /s/ XXXXX XXXXXXXX
----------------------------------
XXXXX XXXXXXXX
As an authorized officer of each
of the foregoing corporations
Address: 0000 Xxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
LENDER
VIACOM INC.
By: /s/ XXXXXX X. XXXXXX
----------------------------------
XXXXXX X. XXXXXX
Title: Senior Vice President, Treasurer
Address: 0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
