Exhibit 10.4(b)
THIRD AMENDMENT TO LOAN AND PURCHASE AGREEMENT
This Third Amendment to Loan and Purchase Agreement ("Third Amendment")
is entered into as of this 30th day of June, 1997, by and among *
*
*
*
*
* , Applied Printing Technologies, L.P., a Delaware limited partnership with its
principal place of business at 000 Xxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 ("AGT"),
Applied Graphics Technologies, Inc., a Delaware corporation with its principal
place of business at 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("New AGT"),
Xxxxxxxx X. Xxxxxxxxx, an individual residing at
* * ("Xx. Xxxxxxxxx"), Daily News, L.P., a Delaware limited partnership
with its principal place of business at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, and U.S. News & World Report, L.P., a Delaware limited partnership with
its principal place of business at 0000 X Xxxxxx X.X., Xxxxxxxxxx, X.X. 00000
(the Daily News and U.S. News and World Report are collectively referred to as
the "Xxxxxxxxx/Xxxxxxx Properties").
Preliminary Statements
(1) * , Xx. Xxxxxxxxx, AGT, New AGT and Xxxxxxxxx/Xxxxxxx Properties are
parties to a Loan and Purchase Agreement dated as of January 8, 1992 (the
"Agreement") as amended by a First Amendment to Loan and Purchase Agreement
dated as of September 18, 1995 and a Second Amendment to Loan and Purchase
Agreement dated as of April 19, 1996 (the "First Amendment and "Second
Amendment" and collectively with the Agreement, the "Purchase Agreement")
pursuant to which * has extended certain Loans to Xx. Xxxxxxxxx, and * and AGT,
New AGT and Xxxxxxxxx/Xxxxxxx Properties have entered into certain
supply/purchase arrangements (capitalized terms not otherwise defined shall have
the meanings attributable to them in the Purchase Agreement).
(2) The parties desire to extend the supply/purchase arrangements in the
Purchase Agreement through December 31, 2000 and to change the Rebate rates, the
value of the Prebate and the terms of Prebate repayments through such date.
(3) Xx. Xxxxxxxxx has agreed to further extend the term of his Amended and
Restated Guaranty Agreement until such time as all indebtedness including the
Initial Loan as represented by the First Note, the Additional Loan as
represented by the Second Note, any Term Loan into which such Notes may be
converted has been repaid to * by Xx. Xxxxxxxxx and the Prebate has been repaid
to * by AGT and New AGT, jointly and severally.
(4) There is to be no other change in the obligations to pay the First and
Second Notes or any Term Loan in which they are converted or * right to
repayment of any such indebtedness as a consequence of the extension of the
supply/purchase arrangement except for additions to Events of Default under the
Notes contemplated by Sections 10, 10A, 10C and 11; nor is there any change in
Rebate rates, the value of the Prebate and the Prebate repayments; and * right
to repayment of the Prebate except as specifically set forth herein.
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
(5) AGT, New AGT, Xx. Xxxxxxxxx and Xxxxxxxxx/Xxxxxxx Properties
specifically acknowledge that the rebate levels set forth herein are significant
concessions on * part and are highly confidential in all respects, and that they
will not receive further increases in such levels or further enhancements to the
program during the term hereof.
Now Therefore, in consideration of the mutual covenants and agreements set
forth herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
Section 1. Amendments to Purchase Agreement. The Purchase Agreement is amended
as of January 1, 1997 as follows:
(a) Section 10 and 10A are restated in their entirety and new Sections 10B
and 10C are added as follows:
10. Purchase and Use of * Products. So long as the Initial Loan, the
Additional Loan, the Term Loan, the Prebate or any other indebtedness is
outstanding by Xx. Xxxxxxxxx or by AGT or New AGT to * and/or * under the terms
of this Purchase Agreement and in any event through December 31, 2000, AGT and
New AGT agree to make * during each consecutive twelve-month period commencing
on January 1, 1997 in an amount sufficient to cause the * during each such
twelve-month period to equal at least * . AGT, New AGT and Xx. Xxxxxxxxx
represent and warrant to * and * that (i) AGT and New AGT currently purchase no
* products from any * or supplier other than * and those * and suppliers
identified in AGT's and New AGT's most recent quarterly purchase reports to * ,
(ii) except for one existing agreement between AGT and New AGT and another * ,
which agreement is terminable by AGT and/or New AGT at will at any time without
penalty or liability of any kind, there is no contract or other agreement
between AGT, New AGT or Xx. Xxxxxxxxx and any person, except for the Purchase
Agreement, as amended, pursuant to which AGT or New AGT is obligated to purchase
* products or * products, and (iii) the obligations to purchase * products or *
products from * pursuant to this Agreement will not result in a breach of, or
create a default under, any existing agreement between AGT or New AGT and any
other * * and/or * product * , or Xx. Xxxxxxxxx and any other * * and/or *
product * , or among any combination of AGT, New AGT, Xx. Xxxxxxxxx and any
other * or * , or result in a breach of, or create a default under, or interfere
with or otherwise affect any other existing contract or other agreement to which
AGT, New AGT or Xx. Xxxxxxxxx is a party or by which either of them is bound.
AGT, New AGT and Xx. Xxxxxxxxx acknowledge that the breach of AGT's and/or New
AGT's obligations under Sections 10, 10A, 10C and 11 will constitute an Event of
Default under the Notes and will entitle * to accelerate payment of the Loans
and will entitle * to require immediate repayment of the Prebate as provided for
herein and to enforce Xx. Xxxxxxxxx'x Second Amended and Restated Guaranty.
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
10A. Purchases and Use of * Products. So long as the Initial Loan, the
Additional Loan, the Term Loan, the Prebate or any other indebtedness is
outstanding and in any event through December 31, 2000, AGT and New AGT will
make commercially reasonable efforts to purchase * Products for its * Products
requirements rather than similar products from other suppliers so long as the *
Products are consistent with AGT's and New AGT's technical and quality
specifications and are price competitive.
So long as Xx. Xxxxxxxxx is indebted to * and/or Xx. Xxxxxxxxx'x Guaranty
Agreement is in effect, he will cause AGT and Xxxxxxxxx/Drasner Properties to
make and Xxxxxxxxx/Xxxxxxx Properties will make commercially reasonable efforts
to purchase * * Products and * Products for their respective * products and *
product requirements rather than similar products from other suppliers provided
that, in the case of Xxxxxxxxx/Drasner Properties, it is Xxxxxxxxx/Xxxxxxx
Properties' reasonable judgment, that the * Products and * Products are
consistent with the Xxxxxxxxx/Drasner Properties' technical and quality
specifications and are price competitive.
Purchase Tracking. AGT and New AGT at their expense will arrange for AGT
and New AGT or All Star Purchasing, Inc. to track and provide purchase data for
all * Products and * Products purchased by AGT, New AGT and the
Xxxxxxxxx/Xxxxxxx Properties and will provide * with these calculations within
30 days of the end of the relevant quarter.
Section 10B Limited Price Increases on * Products.
As additional consideration for the extension of the obligation to purchase
* Products by AGT and New AGT, * agrees that during the period May 1, 1997
through December 31, 1997 prices charged to AGT and New AGT for * Products will
not increase during such period over those charged on April 30, 1997. * further
agrees that prices for * Products during each of 1998, 1999 and 2000 will not
increase by more than * over those charged on the last day of the year prior to
each of such years, and in no event shall the increases be greater than any
overall price increase implemented by * on such products for the whole or any
portion of each such year.
AGT's and New AGT's only remedy for any breach of this paragraph 10B shall
be to recover any amounts charged by * in prices in excess of those provided for
in this paragraph 10B less applicable rebate paid on account of such excess
amounts, and such breach shall not otherwise operate to cancel, amend or offset
any obligation of AGT, New AGT or Xx. Xxxxxxxxx under the Purchase Agreement
including without limitation the repayment of the Initial Loan, or the
Additional Loan, or any Term Loan, or the Prebate, or interest due on any of the
foregoing, or Xx. Xxxxxxxxx'x Guaranty or the obligations imposed by Sections
10, 10A, 10C and 11.
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
10C Purchase of * . As additional consideration for the extension of terms,
changes in rebate schedules, and other matters set forth in this Third
Amendment, AGT and New AGT jointly and severally agree on or before December 31,
1997 to purchase and pay for * at a price of * per unit plus applicable taxes.
The other terms and conditions of each such purchase shall be as set forth on
the standard * purchase order form attached hereto as Exhibit A.
It is understood and agreed that the immediate purchase of that certain * *
presently at * shall be counted as one of the * units required to be purchased
and paid for before December 31, 1997, and that full payment for such unit will
be due on or before September 30, 1997. It is further understood and agreed that
a failure to meet the obligations under this Section 10C will be an Event of
Default under the Notes and will entitle * to require immediate repayment of the
Prebate provided for herein and to enforce Xx. Xxxxxxxxx'x Second Amended and
Restated Guaranty.
(b) Section 11 is restated in its entirety as follows:
11. Payment of Rebates and Prebate
(a) The parties acknowledge and agree that:
(i) Subject only to an audit of the records maintained by * and
AGT/All Star Purchasing, Inc., all rebates due from
inception of the Purchase Agreement through December 31,
1996 have been properly paid to AGT, New AGT and
Xxxxxxxxx/Xxxxxxx Properties.
(ii) * has paid and AGT and New AGT have received the initial
prebate of * * which at January 1, 1997 had a present value
of * * . In consideration of the extension of payment time
provided hereunder and other changed terms including changes
in the rebate percentage set forth below, the parties agree
now that such sum at January 1, 1997 has a value of * * and
such latter sum is hereinafter referred to as "the Prebate"
for the purpose of the Agreement, as amended hereby and for
the purposes of the Second Amended and Restated Personal
Guarantee of Xx. Xxxxxxxxx.
(b) Payment of Rebates. At the end of each calendar quarter commencing
during the term of this Purchase Agreement, and provided that (x) no Event
of Default shall have occurred and be continuing under the First or Second
Note or the Term Loan (if in place), or (y) there is no default in the
obligation respecting repayment of the Prebate, or (z) there has been no
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
other breach of the obligation to purchase * Products or * Products under
Section 10, 10A, and Section 11 and under Section 10C respecting * of the
Purchase Agreement, then AGT, New AGT and Xxxxxxxxx/Xxxxxxx Properties will
each be entitled to receive a rebate from * on its * during such quarter.
The rebates will each be equal to a percentage of AGT's, New AGT's and
Xxxxxxxxx Drasner's * during the applicable quarter. The percentage used
for these purposes will be determined on the basis of the combined
annualized amount of (i) Xxxxxxxxx/Xxxxxxx Properties' Actual
Xxxxxxxxx/Drasner Purchases; (ii) AGT's and New AGT's * * ; and (iii) AGT's
and New AGT's and Xxxxxxxxx/Xxxxxxx Properties' * * (the amounts described
in clauses (i), (ii) and (iii) hereafter called the "Rebate Purchases")
during the quarter in question, as set forth in the following table:
*
* * *
*
* * *
* * *
*
* *
*
* *
* *
* *
* *
*
* *
*
* *
* *
* *
* *
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
While * are used in computing total volume, no rebate is to be paid on such
purchases. For the purposes of determining the applicable rebate percentage
rate, the Rebate Purchases will be annualized as of the end of each of the first
three calendar quarters of each calendar year, with each such calculation being
based solely on the volume of the Rebate Purchases during the quarter in
question, not for the period from the beginning of the year through the end of
such quarter. For example, if in the third quarter of 1997 the Rebate Purchases
of * totaled * , then the rebate on such purchases would be equal to * (i.e., *
in purchases equates to an annualized rate of * ; accordingly, the rebate would
be equal to * of * ). If, on the other hand, the Rebate Purchases of * in such
quarter totaled * , then the rebate on such purchases would be equal to * (i.e.,
* in purchases equate to an annualized rate of * ; accordingly, the rebate would
be equal to * of * ). At the end of each fourth quarter, the Rebate Purchases
for the year will be totaled, and, in the event of any discrepancy between the
annualized rates used during any of the preceding three quarters and the actual
year-end results, the rebate rates will be recalculated for such quarters and
the fourth quarter rebate adjusted accordingly. Each rebate on * to which AGT,
New AGT and Xxxxxxxxx/Drasner Properties are entitled under this Agreement will
be paid by * within thirty days following * receipt of a properly completed
Claims for Payment executed respectively by (x) the General Partner on behalf of
AGT, (y) the Chief Financial Officer of New AGT, and (z) the Chief Financial
Officer of Xxxxxxxxx/Xxxxxxx Properties, in each case setting forth the volume
of Rebate Purchase.
It is understood that Purchases of * Products or * Products outside the
United States shall not be taken into account for these purposes. At AGT's and
New AGT's request, * will consider entering into a separate arrangement with
respect to AGT's and New AGT's overseas business, but * shall have no rebate
obligations with respect thereto absent a written agreement to the contrary
signed by both parties.
It is understood and agreed that Rebate Purchases by each of AGT, New AGT
and Xxxxxxxxx/Drasner Properties during 1997 will be consistent with and not
exceed historic, usual and customary order flow so as to prevent and limit any
purchases in 1997 for actual use in 1998 or thereafter and to prevent purchases
by any one of them for resale to or use by any party except the ordering party
and a breach of the foregoing shall also be deemed an Event of Default under the
Notes.
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
From January 1, 1997 through December 31, 1997 * agrees to pay AGT and New
AGT their rebate on their * and Xxxxxxxxx/Xxxxxxx Properties on Actual
Xxxxxxxxx/Drasner Purchases, on a monthly basis using an estimate of purchases
that equate to an aggregate * month rebate provided, however, that for each
Quarter of 1997 * will retain * of the amount of the total rebate earned by each
of AGT, New AGT and Xxxxxxxxx/Xxxxxxx Properties on account of * and apply that
amount to reduce the Prebate. Quarterly rebate Claims for Payment filings will
be submitted by AGT, New AGT and Xxxxxxxxx/Drasner Properties or All Star
Purchasing as provided hereinabove and at that time any adjustments based on the
actual volumes will be made, the monthly rebates already paid to AGT, New AGT
and Xxxxxxxxx/Xxxxxxx Properties will be offset against the actual rebate owed,
and any additional rebates owed (which in the case of * by AGT, New AGT and
Xxxxxxxxx/Drasner Properties will be net of the applications to reduce the
Prebate) will be paid to AGT, New AGT and Xxxxxxxxx/Xxxxxxx Properties as
provided above. If * overpaid AGT, New AGT or Xxxxxxxxx/Drasner Properties for
the quarter, the overpaid parties will reimburse * for the amount overpaid
within thirty days of receiving written notice of such overpayment. The Parties
agree that all rebate payments shall be made by * to each of AGT, New AGT and
Xxxxxxxxx/Xxxxxxx Properties on account of its pro rata share thereof, said
payments to be delivered to AGT, New AGT and Xxxxxxxxx/Drasner Properties, or in
the aggregate to All Star Purchasing, Inc. for its distribution to AGT, New AGT
and Xxxxxxxxx/Xxxxxxx Properties and such payment to All Star shall be deemed to
satisfy * payment obligation. * shall provide a record of all reductions in the
amount of the Prebate owed by AGT and New AGT through December 31, 1997 and
provide a statement of the outstanding Prebate on January 1, 1998.
Starting the first quarter of 1998 through the fourth quarter of 2000, the
rebates due to AGT, and New AGT under this Section 11 will be reconciled on a
quarterly basis against the value of the outstanding Prebate at January 1, 1998.
This will be done in the following manner. The amount of rebate earned by AGT
and New AGT for the quarter will be determined. If the amount of rebate earned
by AGT and New AGT during the quarter is in excess of * * of the outstanding
Prebate, * will pay AGT and New AGT the excess rebate for that quarter within 30
days of the end of the quarter. If AGT and New AGT earn less than * * of the
outstanding Prebate on January 1, 1998, AGT and New AGT, jointly and severally,
must pay * the difference between the earned rebate and such * of the
outstanding Prebate. * will invoice AGT and New AGT for the difference and AGT
and New AGT are jointly and severally obligated to pay the invoice within 30
days. * and AGT/All Star will keep the appropriate records and will determine
the appropriate rebate. It is the intent and purpose of this paragraph to reduce
the outstanding Prebate on January 1, 1998 by * during each of the twelve
quarters during the period January 1, 1998 through December 31, 2000.
Should AGT or New AGT or Xxxxxxxxx/Drasner Properties at any time breach
its obligation to purchase * and * as provided in Sections 10, 10A and Section
11 and under Section 10C respecting * , * may, at its option, require that AGT
and New AGT, jointly and severally, immediately pay to * the Adjusted Balance
(as defined below) of the Prebate, together with interest on the Adjusted
Balance at * computed from the date of the breach through the actual date of the
payment of the Adjusted Balance. For purposes of this Section (i) the Adjusted
Balance shall be calculated by adding to the balance of the Prebate on the date
of breach an amount equal to the "unearned" portion of any reduction in the
Prebate credited during 1997 (such reduction, the "1997 Reduction"), and (ii)
the "unearned" portion of the 1997 Reduction shall be computed by multiplying
the 1997 Reduction by a fraction, which shall be determined in accordance with
the following schedule:
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
*
*
* *
* *
* *
* *
* *
* *
* *
* *
* *
* *
* *
* *
If * exercises its option to require payment of the Adjusted Balance, then
such sum shall become "the Prebate" for the purposes of Xx. Xxxxxxxxx'x Guaranty
Agreement and Xx. Xxxxxxxxx acknowledges he has individually guaranteed such
payment. In such event, AGT and New AGT waive any and all defenses (including,
without limit demands for payment, notice and presentment) to such payment
except those defenses which factually dispute any alleged non-compliance with
Section 10 and 10A.
Section 2. Amendment to Guaranty Agreement. Xx. Xxxxxxxxx shall deliver
concurrently with his execution of this Third Amendment an executed copy of the
Second Amended and Restated Guaranty Agreement attached hereto as Exhibit B
which acknowledges and agrees to the changes in the value of the Prebate and the
terms of the repayment of the Prebate.
Section 3. Confirmation of Agreement. Except as expressly amended herein, the
Purchase Agreement is ratified and confirmed in all respects and shall remain in
full force and effect in accordance with its terms. Xx. Xxxxxxxxx and AGT and
New AGT and each of them represent and confirm each and every representation and
warranty previously made is true and correct and continuing as of the date of
this Third Amendment and that there has been no breach thereof by any of them as
of the date of this Third Amendment. It is expressly understood and agreed that
no term, condition or change set forth in this Third Amendment shall operate to
extend or change the maturity or any other term or condition of the First or
Second Note and Xx. Xxxxxxxxx'x absolute obligation to repay such Notes except
the additions to Events of Default under such Notes contemplated by Sections 10,
10A, 10C and 11; nor shall it effect the absolute obligation
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
to repay the Prebate except in so far as this Third Amendment changes the amount
of such Prebate and the time for repayment of such Prebate, nor shall it effect
the absolute guarantee of Xx. Xxxxxxxxx for the repayment of the Prebate except
as expressly set forth in the Second Amended and Restated Guaranty Agreement. It
is the intention of the parties that at all times from inception of the Prebate
through its final payment that Xx. Xxxxxxxxx'x guaranty thereof be continuous
and uninterrupted.
Section 4. Execution in Counterparts. This Third Amendment may be executed in
counterparts, each of which shall be deemed an original, and all of which taken
together shall constitute one and the same instrument.
Section 5. Governing Law. The interpretation and construction of this Third
Amendment to the Loan and Purchase Agreement, and all matters in connection
herewith, shall be governed by the substantive laws of the State of New York,
without regard to the choice of law principles.
Section 6. Effectiveness. This Third Amendment, together with the amendments to
the Purchase Agreement incorporated in this Third Amendment, and the Second
Amended and Restated Guaranty Agreement (the form of which is attached hereto as
Exhibit B) shall be effective as of January 1, 1997 upon receipt by * and * of
the last signed counterpart and the signed Second Amended and Restated Guaranty
Agreement.
(The remainder of this page is intentionally blank)
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
Witness the following signatures:
* *
By: * By:*
(signature) (signature)
* *
(title) (title)
Date: July 24, 1997 Date: July 24,
1997
Xxxxxxxx X. Xxxxxxxxx Daily News, L.P.
By: /s/ Xxxxxxxx X. Xxxxxxxxx By: /s/ Xxxx
Xxxxxxx
(signature) (signature)
Chief Executive Officer
(title)
Date: July 22, 1997 Date: July 22,
1997
U.S. News & World Report, L.P. Applied Printing Technologies, L.P.
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxx
Xxxxxxx
(signature) (signature)
Chief Executive Officer Chairman and Chief Executive Officer
(title) (title)
Date: : July 22, 1997 Date:: July 22,
1997
Applied Graphics Technologies, Inc.
By: /s/ Xxxx Xxxxxxx
(signature)
Chairman and Chief Executive Officer
(title)
Date: : July 22,
1997
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
EXHIBIT B OF THIRD AMENDMENT TO LOAN & PURCHASE AGREEMENT
Second Amended and Restated Guaranty Agreement
June 30, 1997
*
*
*
Gentlemen:
For value received and in order to induce * , with its principal place of
business at * , to have originally provided a prebate ("Prebate") to Applied
Graphics Technologies, L.P., a/k/a/ Applied Printing Technologies, L.P. with its
principal place of business at 000 Xxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 ("AGT")
and Applied Graphic Technologies, Inc. a Delaware corporation with its principal
place of business at 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("New AGT"),
and to extend the time for repayment of the Prebate and an increase in the
rebate percentages, to change certain terms, including the value of the Prebate
and the amount of Prebate to be paid during 1997 and thereafter and relating to
purchases to be made by AGT, New AGT and Xxxxxxxxx/Drasner Properties from * ,
and to execute the Third Amendment of Loan and Purchase Agreement of even date
herewith among * , * * , AGT, New AGT Xxxxxxxx X. Xxxxxxxxx ("Guarantor"), Daily
News, L.P, and U.S. News & World Report, L.P., known collectively as
Xxxxxxxxx/Drasner Properties (the "Third Amendment"), Guarantor, an individual
residing at * * hereby, absolutely, irrevocably and unconditionally, guarantees
unto * , its successors and assigns, the payment of the Prebate in the aggregate
amount of * * with applicable interest, to * pursuant to and under the First
Amendment of Loan and Purchase Agreement dated September l8, 1995 between * ,
AGT and Guarantor, and the Second Amendment thereto between * and AGT, New AGT
and Xxxxxxxxx Properties dated April 19, 1996 and the Third Amendment thereto
and as amended from time to time (including but not limited to as amended by the
Third Amendment), and including any extensions and renewals thereof or part
thereof, together with interest, fees, charges, expenses and costs of collection
or enforcement, including attorneys fees (collectively, the "Liabilities").
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
Guarantor acknowledges and agrees that the Liabilities shall not be reduced
by any "unearned" portion of any reduction in the Prebate credited during 1997
as such "unearned" portion is calculated under the terms of Section 11 of the
Loan and Purchase Agreement respecting the "Adjusted Balance." Thus in the event
that there is any breach by AGT or New AGT or Xxxxxxxxx/Drasner Properties of
any obligation set forth in Section 10, 10A, 10C or 11 of the Loan and Purchase
Agreement as amended, then the Liabilities shall include the Adjusted Balance of
the Prebate together with interest, fees, charges, expenses and costs of
collections and enforcement.
* may without notice or demand of any kind grant any extensions of time to
or make any compromise with or release and discharge AGT or New AGT, or any
other party or parties liable with AGT or New AGT upon any instrument,
indebtedness or obligation, or any other guarantor thereof, and * may release or
omit to collect or enforce or may compromise any collateral security held by it
without regard to any demands or requests by Guarantor and without thereby
releasing Guarantor hereunder or incurring any liability to Guarantor.
* may without notice or demand of any kind realize on and apply any
collateral held by * , whether or not deposited by Guarantor, to such obligation
or obligations as * may elect, whether guaranteed hereby or not, without regard
to any rights of Guarantor in respect to the application thereof. All sums at
any time to the credit of the Guarantor and any property of the Guarantor in *
possession shall be deemed held by * as security for any and all of Guarantor's
obligations hereunder.
If AGT or New AGT fail to pay all or any part of the Liabilities when due,
whether by acceleration or otherwise, Guarantor, immediately upon written demand
of * , will pay to * all Liabilities then due and unpaid by AGT or New AGT as if
such Liabilities constituted direct and primary obligations of Guarantor.
This instrument shall be deemed to be a continuing guaranty of payment and
not of collectability and shall remain in full force and effect until full
performance and payment of all of the Liabilities, whether absolute or
contingent, and any renewals or extensions thereof. * and AGT and/or New AGT may
agree to subsequent changes on the applicable interest rate without impairing
any of * right under this Guaranty. * may release Guarantor without in way
affecting or terminating the obligations of any other guarantors as to then
existing or future Liabilities and notice by Guarantor shall in no way offer or
terminate the obligation of Guarantor or any of the Guarantors as to then
existing or future Liabilities. Guarantor's liability hereunder is in no way
conditional or contingent upon any attempt to collect from AGT or New AGT or
realize upon any collateral security for the Liabilities. Guarantor shall have
no right of subrogation, reimbursement or indemnity whatsoever and no right of
recourse to or with respect to any assets or property of AGT or New AGT or to
any collateral for the Liabilities, unless and until all the Liabilities have
been paid and performed in full.
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
Guarantor agrees to pay its obligations hereunder without deduction by
reason of any set-off, defense or counterclaim of AGT or New AGT, and without
requiring protest, presentment or notice of dishonor or notice of default or
non-payment. Guarantor's obligation shall not be affected by any invalidity or
unenforceability of the Liabilities against AGT and/or New AGT or any other
person or entity, all of which are hereby waived.
Guarantor represents and warrants that the execution, delivery and
performance hereof and of any term, covenant or condition herein provided for
are within his power and are not in conflict with any indenture, contract or
agreement to which Guarantor is a party or by which Guarantor is bound, or with
any statute, rule regulation, decree, judgment or order binding upon Guarantor.
Guarantor covenants that from the date hereof until all obligations owing
to * hereunder have been paid fully, Guarantor shall furnish to * annually,
promptly and as soon as available, but in no event more than 90 days after the
end of each calendar year, financial statements at the end of and for such
calendar year and, promptly after * request, such other financial information as
* may from time to time reasonably request.
Books and records showing the account and amounts outstanding between * on
the one hand and AGT and New AGT on the other shall be admissible in evidence in
any action or proceedings and shall constitute prima facie proof thereof.
Guarantor expressly waives any rights to notice of acceptance from * or to any
other notice or demand upon Guarantor or to any other actions or conditions
prior to * reliance upon or enforcement of this Guaranty. * may take or refrain
from taking any of the actions authorized under this Guaranty without notice of
any kind to Guarantor. Arrangements by and between AGT, New AGT and
Xxxxxxxxx/Xxxxxxx Properties respecting the Liabilities shall not operate to
waive, cancel or amend Guarantor's absolute and unconditional obligations under
this Guaranty.
This Guaranty shall be enforceable as to all of the Liabilities despite any
discharge of AGT or New AGT in bankruptcy and despite adjustment of all or any
part of the Liabilities in insolvency proceedings or pursuant to some other
compromise with creditors. If claim is ever made upon * for repayment or
recovery of any amount or amounts received by * in payment or on account of any
of the Liabilities, and * repays all or part of said amount by reason of (a) any
judgment, decree or order of any court or administrative body, or (b) any
settlement or compromise of any such claim effected by * with any such claimant
(including AGT or New AGT), then and in such event Guarantor agrees that any
such judgment, decree, order, settlement, or compromise shall be binding upon
Guarantor, notwithstanding any termination hereof or the cancellation of any
such Liabilities, and Guarantor shall be and remain liable hereunder for the
amounts so repaid or recovered to the same extent as if such amount had never
originally been received by * .
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
Guarantor's liability hereunder is in addition to and independent of any
other liabilities such Guarantor has incurred or assumed, or may hereafter incur
or assume, by way of endorsement, separate guaranty agreement, or in any other
manner, with respect to all or any part of the Liabilities guaranteed hereby.
This Guaranty does not supersede or limit any such other liabilities of
Guarantor, and * rights and remedies under and pursuant to this Guaranty and any
such other liabilities are cumulative and may be exercised singly or
concurrently.
This instrument shall be binding upon Guarantor, and any heirs, personal
representatives or successors and assigns, and shall inure to * benefit. This
instrument contains the entire agreement between parties hereto and cannot be
changed orally. No failure by * to exercise any right hereunder shall be deemed
a waiver thereof, nor shall any single or partial exercise by * of any right
hereunder preclude any other or further exercise thereof, and no waiver by * of
any right hereunder shall operate as a waiver of any other right.
This Guaranty shall be governed by the laws of the State of New York
without regard to choice of law principles. Any provision of this Guaranty which
found to be prohibited by law will be ineffective to the extent to such
prohibition without invalidating the remaining provisions.
In Witness Whereof, Guarantor has executed this instrument as of the date
first set forth above.
Date: June 30, 1997 /s/ Xxxxxxxx X. Xxxxxxxxx
Xxxxxxxx X. Xxxxxxxxx
On this 30th day of June, 1997, before me personally appeared Xxxxxxxx X.
Xxxxxxxxx who, being by me duly sworn did depose and say that he resides at * *
and that he is the individual who executed the foregoing agreement.
Notary Public
My Commission Expires:
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
SECOND AMENDMENT TO PROMISSORY NOTE
This Second Amendment to Promissory Note ("Second Amendment") is made as of
the 30th day of June, 1997 by and between * ("Lender") and Xxxxxxxx X. Xxxxxxxxx
("Borrower") and amends the Promissory Note of Borrower to Lender, dated January
8, 1992, in the original principal amount of Twelve Million Dollars
($12,000,000) as amended by the First Amendment to Promissory Note between
Lender and Borrower, dated April 19, 1996 (the "Promissory Note"). Capitalized
terms used herein and not otherwise defined shall have the meaning ascribed
thereto in the Promissory Note.
The Promissory Note was issued in connection with the Loan and Purchase
Agreement, dated as of January 8, 1992, among * , Lender, Applied Print-ing
Technologies, L.P. ("AGT"), Borrower and Daily News, L.P. and was amended by a
First Amendment of Loan and Purchase Agreement among such parties dated as of
September 18, 1995, and further amended by a Second Amendment to Loan and
Purchase Agreement to, among other things, add Applied Graphics Technology, Inc.
("New AGT") and U.S. News & World Report, L.P. as parties (the Loan and Purchase
Agreement, as amended by the First and Second Amendments, the "Purchase
Agreement"). (Daily News, L.P. and U.S. News & World Report, L.P. are referred
to herein as the "Xxxxxxxxx/Drasner Properties"). The parties have agreed to
further amend the Purchase Agreement and have entered into a Third Amendment to
Loan and Purchase Agreement (the "Third Amendment"), dated as of June 30, 1997.
NOW, THEREFORE, in consideration of the mutual promises and agreements set
forth in the Purchase Agreement and the Third Amendment and the documents and
instruments issued by the parties in connection therewith and intending to be
legally bound, Lender and Borrower agree as follows:
1. The Events of Default set forth in the Promissory Note are hereby
amended and a new paragraph (e) is hereby added to replace the existing
paragraph (e) in its entirety as follows:
(e) Breach of Purchase Requirements; Termination of Purchase
Agreement or Guaranty.
(i) AGT and/or New AGT fail to make, at the times and in the
amounts specified, * , purchases of * Products, purchases of * *
and such other purchases of * products or otherwise fail to
comply with AGT's and/or New AGT's covenants as set forth in
Section 10, 10A, 10C and 11 of the Purchase Agreement, as amended
by the Third Amendment; or
(ii) Borrower fails to cause any of AGT, New AGT or the
Xxxxxxxxx/Xxxxxxx Properties to make the purchases required under
Sections 10, 10A or 10C of the Pur-chase Agreement, as amended by
the Third Amendment; or
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
(iii) The Purchase Agreement, as amended by the Third Amendment,
or the Second Amended and Restated Guaranty Agreement of Borrower
to * , dated as of June 30, 1997 (the "Guaranty Agreement") shall
cease to be in full force and effect or shall be terminated or
the validity or enforceability thereof shall be contested by
Borrower or by any other person other than * or * .
2. All references to the Promissory Note in the Purchase Agreement or in
the Third Amendment shall be the Promissory Note as amended by this Second
Amendment to Promissory Note. An executed copy of this Second Amendment shall be
affixed to the Promissory Note.
3. This Second Amendment may be executed in one or more counterparts, each
of which shall be deemed an original and all of which, when taken together,
shall constitute one instrument.
4. Except as expressly amended hereby, all of the terms, covenants and
conditions of the Promissory Note shall continue in full force as effect in
accordance with its terms.
IN WITNESS WHEREOF, this Second Amendment has been executed as of the date
first above written.
BORROWER:
-------------------------------
Xxxxxxxx X. Xxxxxxxxx
LENDER:
*
By:________________________________
Title:_______________________________
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
SECOND AMENDMENT TO PROMISSORY NOTE
This Second Amendment to Promissory Note ("Second Amendment") is made as of
the 30th day of June, 1997 by and between * ("Lender") and Xxxxxxxx X. Xxxxxxxxx
("Borrower") and amends the Promissory Note of Borrower to Lender, dated June
23, 1993, in the original principal amount of Three Million Dollars ($3,000,000)
as amended by the First Amendment to Promissory Note between Lender and
Bor-rower, dated April 19, 1996 (the "Promissory Note"). Capitalized terms used
herein and not oth-erwise defined shall have the meaning ascribed thereto in the
Promissory Note.
The Promissory Note was issued in connection with the Loan and Purchase
Agreement, dated as of January 8, 1992, among * , Lender, Applied Print-ing
Technologies, L.P. ("AGT"), Borrower and Daily News, L.P. and was amended by a
First Amendment of Loan and Purchase Agreement among such parties, dated as of
September 18, 1995, and further amended by a Second Amendment to Loan and
Purchase Agreement to, among other things, add Applied Graphics Technology, Inc.
("New AGT") and U.S. News & World Report, L.P. as parties (the Loan and Purchase
Agreement, as amended by the First and Second Amendments, the "Purchase
Agreement"). (Daily News, L.P. and U.S. News & World Report, L.P. are referred
to herein as the "Xxxxxxxxx/Xxxxxxx Properties"). The parties have agreed to
further amend the Purchase Agreement and have entered into a Third Amendment to
Loan and Purchase Agreement (the "Third Amendment"), dated as of June 30, 1997.
NOW, THEREFORE, in consideration of the mutual promises and agreements set
forth in the Purchase Agreement and the Third Amendment and the documents and
instruments issued by the parties in connection therewith and intending to be
legally bound, Lender and Borrower agree as follows:
1. The Events of Default set forth in the Promissory Note are hereby
amended and a new paragraph (e) is hereby added to replace the existing
paragraph (e) in its entirety as follows:
(e) Breach of Purchase Requirements; Termination of Purchase
Agreement or Guaranty.
(i) AGT and/or New AGT fail to make, at the times and in the amounts
specified, * , purchases of * Products, purchases of * * and such
other purchases of * products or otherwise fail to comply with
AGT's and/or New AGT's covenants as set forth in Section 10, 10A,
10C and 11 of the Purchase Agreement, as amended by the Third
Amendment; or
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
(ii) Borrower fails to cause any of AGT, New AGT or the
Xxxxxxxxx/Drasner Properties to make the purchases required under
Sections 10, 10A or 10C of the Pur-chase Agreement, as amended by
the Third Amendment; or
(iii)The Purchase Agreement, as amended by the Third Amendment, or
the Second Amended and Restated Guaranty Agreement of Borrower to
* , dated as of June 30, 1997 (the "Guaranty Agreement"), shall
cease to be in full force and effect or shall be terminated or
the validity or enforceability thereof shall be contested by
Borrower or by any other person other than * or * .
2. All references to the Promissory Note in the Purchase Agreement or in
the Third Amendment to shall be the Promissory Note as amended by this Second
Amendment to Promis-sory Note. An executed copy of this Second Amendment shall
be affixed to the Promissory Note.
3. This Second Amendment may be executed in one or more counterparts, each
of which shall be deemed an original and all of which, when taken together,
shall constitute one instrument.
4. Except as expressly amended hereby, all of the terms, covenants and
conditions of the Promissory Note shall continue in full force as effect in
accordance with its terms.
IN WITNESS WHEREOF, this Second Amendment has been executed as of the date
first above written.
BORROWER:
-------------------------------
Xxxxxxxx X. Xxxxxxxxx
LENDER:
*
By:________________________________
Title:_______________________________
* Text deleted pursuant to application for Confidential Treatment under Rule
24b-2 of the Securities Exchange Act of 1934 and filed separately with the
Securities and Exchange Commission
