CONFORMED COPY
FIRST AMENDMENT dated as of
September 17, 1997 (the "Amendment"), to the
US$400,000,000 Competitive Advance and
Revolving Credit Facility Agreement dated as
of November 12, 1996 (the "Agreement"), among
THE READER'S DIGEST ASSOCIATION, INC., as a
Borrower and as the Guarantor (each as
defined therein), the Borrowing Subsidiaries
(as defined therein), the Lenders (as defined
therein), THE CHASE MANHATTAN BANK, as
Administrative Agent, and X.X. XXXXXX
SECURITIES INC., as Syndication Agent.
The Borrowers (as defined in the Agreement) have
requested that the Lenders amend the net worth covenant of
the Agreement, and pursuant to Section 10.02(b) of the
Agreement, the Required Lenders are willing, on the terms
and subject to the conditions set forth below, to amend such
covenant as provided herein. Accordingly, in consideration
of the mutual agreements herein contained and other good and
valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, the parties hereto hereby agree as
follows:
SECTION 1. Definitions. Capitalized terms used
and not otherwise defined herein shall have the meanings
assigned to them in the Agreement.
SECTION 2. Amendments. Section 6.07 of the
Agreement is hereby amended by deleting such section in its
entirety and substituting, as of the Effective Date (as
defined in Section 4 herein), the following:
"SECTION 6.07. Consolidated Tangible Net Worth.
The Company will not permit Consolidated Tangible Net
Worth at any time to be less than the amount set forth
below for the time period set forth below:
Consolidated
Tangible
Time Period Net Worth
Until June 30, 1998: $175,000,000
On and after June 30, 1998
until December 31, 1998: $200,000,000
On and after December 31,
1998 until and on December
31, 1999: $250,000,000
After December 31, 1999: $300,000,000".
SECTION 3. Representations and Warranties. The
Company represents and warrants to each of the Lenders that:
(a) This Amendment has been duly authorized,
executed and delivered by it and constitutes a legal, valid
and binding obligation of the Company, enforceable in
accordance with its terms, except as enforcement thereof may
be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting
the enforceability of creditors' rights generally and by
general principles of equity.
(b) The representations and warranties set forth
in Article IV of the Agreement are true and correct with the
same effect as if made on the date hereof, except to the
extent such representations and warranties expressly relate
to an earlier date, in which case they were true and correct
in all material respects on and as of such earlier date.
(c) Before and after giving effect to this
Amendment, no Default has occurred and is continuing.
SECTION 4. Conditions to Effectiveness. This
Amendment shall become effective when each of the following
conditions is satisfied:
(a) The Administrative Agent (or its counsel)
shall have received counterparts of the Amendment signed by
each of the Company and the Required Lenders (such date
being herein called the "Effective Date").
(b) The Administrative Agent shall have received,
on behalf of itself and the Lenders, a favorable written
opinion of Xxxxxxxx X.X. XxXxxx, Associate General Counsel
of the Company, addressed to the Administrative Agent and
the Lenders, dated the Effective Date and covering such
matters relating to the Company, this Amendment and the
Transactions as the Administrative Agent may reasonably
request.
(c) The Administrative Agent shall have received a
certificate, dated the Effective Date, signed by a Financial
Officer of the Company to the effect set forth in
clauses (b) and (c) of Section 3.
(d) The Administrative Agent shall have received
all documents it may reasonably request relating to the
existence or good standing of the Company or any other
Borrower or the Guarantor, the corporate power and authority
of the Company and any such other Borrower or the Guarantor
to enter into and the validity of this Amendment and the
other Loan Documents, and any other matters relevant hereto,
all in form and substance satisfactory to the Administrative
Agent.
(e) The Lenders shall have received the upfront
fees referred to in clause (a) of Section 7 below.
SECTION 5. Applicable Law. THIS AMENDMENT SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.
SECTION 6. Counterparts. This Amendment may be
executed in any number of counterparts, each of which shall
constitute an original but all of which when taken together
shall constitute but one agreement. Counterparts of this
Amendment may be delivered via telecopy transmission with
the same effect as the delivery of a manually executed
counterpart.
SECTION 7. Fees and Expenses. The Company shall
pay (a) upfront fees to all the Lenders in connection with
this Amendment, allocated pro rata among the Lenders in
accordance with their respective Commitments, as previously
agreed upon by the Lenders and the Company and (b) all
reasonable out-of-pocket expenses incurred by the
Administrative Agent in connection with the preparation,
execution and delivery of this Amendment, including but not
limited to the reasonable fees, charges and disbursements of
Cravath, Swaine & Xxxxx, counsel for the Administrative
Agent.
SECTION 8. Agreement. Except as specifically
amended or modified hereby, the Agreement shall continue in
full force and effect in accordance with the provisions
thereof. As used therein, the terms "Agreement", "herein",
"hereunder", "hereinafter", "hereto", "hereof" and words of
similar import shall, unless the context otherwise requires,
refer to the Amendment.
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be duly executed by their duly authorized
officers, all as of the date first above written.
THE READER'S DIGEST
ASSOCIATION, INC.
By
/s/: Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Vice President &
Treasurer
Guarantor:
THE READER'S DIGEST ASSOCIATION, INC.
By
/s/: Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Vice President &
Treasurer
THE CHASE MANHATTAN BANK,
individually and as
Administrative Agent
By
/s/: Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Vice President
X. X. XXXXXX SECURITIES INC.,
as Syndication Agent
By
/s/: Xxxxxxx Xxxxxxxxx
Name: Xxxxxxx Xxxxxxxxx
Title: Vice President
XXXXXX GUARANTY TRUST COMPANY
By
/s/: Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President
BARCLAYS BANK PLC
By
/s/: Xxxxxxx Xxxxxxx
Name: Xxxxxxxx Xxxxxxx
Title: Associate Director
CITIBANK, N.A.
By
/s/: Xxxxxxxx X. Xxxx
Name: Xxxxxxxx X. Xxxx
Title: Attorney in Fact
COMMERZBANK AG, New York
and/or Grand Cayman Branches
By
/s/: Xxxxxx X. Xxxxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxxxx
Title: Vice President
By
/s/: Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Assitant Treasurer
MELLON BANK, N.A.
By
/s/: Xxxxx XxXxxxx
Name: Xxxxx XxXxxxx
Title: Vice President
ISTITUTO BANCARIO SAN PAOLO DI TORINO
By
/s/: Xxxxxx X. XxXxxxx
Name: Xxxxxx X. XxXxxxx
Title: Vice President
By
/s/: Xxxxxx Xxxxxxx
Name: Xxxxxx Xxxxxxx
Title: 1st Vice President
NATIONAL WESTMINSTER BANK PLC, NEW YORK BRANCH
By /s/: Xxxxxxxxxxx Xxxxx
Name: Xxxxxxxxxxx Xxxxx
Title: Assistant Vice President
By/s/: Xxxxxx Xxxxxxxxx
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
THE SUMITOMO BANK, LIMITED, NEW YORK BRANCH
By/s/: Xxxx X. Xxxxxxxxx
Name: Xxxx X. Xxxxxxxxx
Title: Joint General Manager
SVENSKA HANDELSBANKEN
By/s/: Xxxxxxxx Xxxxxx
Name: Xxxxxxxx Xxxxxx
Title: Senior Vice President
By/s/: Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: Vice President
UNION BANK OF SWITZERLAND, NEW YORK BRANCH
By/s/: Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
Title: Director
By/s/: Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Assitant Vice President
ABN AMRO BANK N.V., NEW YORK BRANCH
By /s/: Xxxxxxx OR Xxxxx
Name: Xxxxxxx OR Xxxxx
Title: Group Vice President
By /s/: R. Xxxxx Xxxxx
Name: R. Xxxxx Xxxxx
Title: Assistant Vice President
THE FUJI BANK, LIMITED, NEW YORK BRANCH
By /s/: Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
Title: Vice President & Manager
ING BANK N.V.
By /s/: X.X. Xxxxx
Name: X.X. Xxxxx
Title: Legal Counsel
By /s/: W.E.J. Stut
Name: W.E.J. Stut
Title: Head Legal Department
CIBC INC.
By /s/: Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Director
