SIXTH AMENDMENT TO CREDIT AGREEMENT
SIXTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), dated
as of June 30, 1997, among XXXXXXXX COMMUNICATIONS, INC. ("Communications"),
XXXXXXXX GRAPHICS, INC. (the "Borrower"), the financial institutions party to
the Credit Agreement referred to below (the "Lenders"), BT COMMERCIAL
CORPORATION, as Agent (the "Agent") for the Lenders, and BANKERS TRUST COMPANY,
as Issuing Bank (the "Issuing Bank"). All capitalized terms used herein and not
otherwise defined shall have the respective meanings provided such terms in the
Credit Agreement.
W I T N E S S E T H :
WHEREAS, Communications, the Borrower, the Lenders, the Agent
and the Issuing Bank are parties to a Credit Agreement, dated as of August 15,
1995 (as amended, modified or supplemented to the date hereof, the "Credit
Agreement"); and
WHEREAS, the parties hereto wish to amend the Credit Agreement
as herein provided;
NOW, THEREFORE, it is agreed:
1. The definition of "Borrowing Base" contained in Section 1.1
of the Credit Agreement is hereby amended by (i) deleting the period at the end
of clause (D) thereof and inserting in lieu thereof the phrase ", minus" and
(ii) inserting at the end of said definition the following new clause:
"(E) an amount equal to (i) on any date prior to December 31,
1997, $4,000,000, (ii) on any date from and including December 31 to
and including March 30, 1998, $3,000,000 and (iii) on any date
thereafter, 0.".
2. Section 1.1 of the Credit Agreement is hereby amended by
inserting in the appropriate alphabetical order the following new definitions:
"New Term Loan Agreement" shall mean a term loan agreement to
be entered into among Communications, the Borrower, the financial
institutions a party thereto and Bankers Trust Company, as
Administrative Agent thereunder, providing for the making of up
$25,000,0000 aggregate principal amount of term loans to the Borrower,
as same may be amended, modified or supplemented from time to time. It
is understood that the new Term Loan Agreement shall be on terms and
conditions substantially in accordance with the provisions attached as
Exhibit A to the Sixth Amendment, with such changes as would be
permitted pursuant to Permitted New Term Loan Amendments.
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"New Term Loan Documents" shall mean the New Term Loan
Agreement and all guaranties, security documents and other documents
(including, without limitation, all Credit Documents as defined in the
New Term Loan Agreement) delivered pursuant to the requirements of the
New Term Loan Agreement.
"Permitted New Term Loan Amendments" shall mean any amendment,
modification or waiver to the New Term Loan Agreement and/or any other
New Term Loan Documents (x) which makes such document or documents less
restrictive or waives any provision contained therein or (y) which
makes the covenants, defaults or other provisions contained in the New
Term Loan Agreement more restrictive, provided that any such Permitted
New Term Facility Amendment pursuant to clause (y) of this definition
(i) is deemed necessary or desirable in connection with the syndication
of the New Term Loan Agreement by the lenders thereunder and (ii) does
not make the covenants, defaults or other provisions contained therein
more restrictive than those contained in this Credit Agreement.
"Sixth Amendment" shall mean the Sixth Amendment to this
Credit Agreement, dated as of June 30, 1997, among Communications, the
Borrower, various of the Lenders, the Agent and the Issuing Bank.
3. Section 2.6(f) of the Credit Agreement is hereby Amended by
inserting at the end thereof the following new sentence:
"Notwithstanding anything to the contrary contained above, with respect
to mandatory repayments pursuant to this Section 2.6(f) only as a
result of equity issuances by Communications, at the time of each event
giving rise to a mandatory repayment pursuant to such Section, to the
extent the amount otherwise required to be applied pursuant to the
terms of said Section is used to permanently repay Indebtedness under
the New Term Loan Agreement, the amount so applied shall apply to
reduce the amount of the mandatory repayment otherwise required
pursuant to this Section 2.6(f)."
4. Section 7.1(a) of the Credit Agreement is hereby amended by
inserting the parenthetical "(or, in the case of fiscal year 1997 only, 120
days)" immediately following the phrase "90 days" contained in the first
sentence of said Section.
5. Section 7.1(b) of the Credit Agreement is hereby amended by
inserting immediately following the phrase "in any event within 45 days"
appearing in the first sentence thereof the parenthetical "and in any event not
later than July 20, 1998 in the case of the fiscal quarter ending on, or closest
to, June 30, 1998)".
6. Section 8.2 (c) of the Credit Agreement is hereby amended
by inserting the following parenthetical immediately after the phrase "other
Credit Documents" appearing therein:
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"(it being understood and agreed that, from and after the date of any
extension of loans pursuant to Section 8.3(l), all such loans and
obligations relating thereto may be secured pursuant to the Credit
Documents, on a second-priority basis to the Obligations, in accordance
with the amendments to the various Collateral Documents authorized
pursuant to the Sixth Amendment, and any Collateral Documents
thereafter entered into may likewise secure such Indebtedness and
related obligations pursuant to 8.3(l) on substantially the same
basis)".
7. Section 8.3 of the Credit Agreement is hereby amended by
(i) deleting the period at the end of clause (l) of said Section and inserting a
semicolon in lieu thereof, (ii) redesignating clause (m) of said Section as
clause (n), (iii) deleting the text "(l)" appearing in redesignated clause (n)
of said Section and inserting in lieu thereof the text "(m)" and (iv) inserting
the following new clause (m) immediately after clause (l) of said Section:
"(m) Indebtedness of the Borrower in an aggregate principal
amount not to exceed $25,000,000 (less any payments of principal
thereon) in respect of loans made pursuant to the New Term Loan
Agreement and guarantees thereof by the Guarantors; provided that the
cash proceeds of the loans under the New Term Loan Agreement (net of
any costs, fees and expenses payable in connection therewith) are used
by the Borrower to repay outstanding Revolving Loans hereunder
(although no reduction to the Total Revolving Loan Commitment shall be
required in connection therewith); and".
8. Section 8.9 of the Credit Agreement is hereby amended by
deleting in its entirety the table appearing in said Section and inserting in
lieu thereof the following new table:
"Fiscal Quarter Ended Minimum EBITDA
--------------------- --------------
March 31, 1997 $46,600,000
June 30, 1997 $45,700,000
September 30, 1997 $43,500,000
December 31, 1997 $41,500,000
March 31, 1998 $44,200,000
June 30, 1998 $50,100,000
September 30, 1998 $62,000,000
December 31, 1998 $63,000,000
March 31, 1999 $65,000,000
June 30, 1999 $65,000,000
September 30, 1999 $66,000,000
December 31, 1999 $67,000,000
Each fiscal quarter
ended thereafter $68,000,000
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; provided, that should the Borrower fail to deliver the financial statements
and accompanying information for the fiscal quarter ended June 30, 1998 by July
20, 1998 as required by to Section 7.1(b), EBITDA of the Borrower required to be
achieved (x) for the period ending June 30, 1998 shall be $61,000,000 and (y)
for each period ending after June 30, 1998 shall be respective amount as
provided in the Credit Agreement before giving effect to the Sixth Amendment, in
each case rather than the amount set forth for such period in the table above."
9. Section 8.10 of the Credit Agreement is hereby amended by
inserting immediately prior to the period at the end thereof the following
parenthetical:
"(or, for the three fiscal quarters ended June 30, 1997, December 31,
1997 and June 30, 1998, 1.05:1.0, provided that should the Borrower
fail to deliver the financial statements and accompanying information
for the fiscal quarter ended June 30, 1998 by July 20, 1998 as required
by Section 7.1(b), the minimum Current Ratio for the fiscal quarter
ended June 30, 1998 shall be 1.1:1.0 rather than 1.05:1.0)".
10. Section 8.11 of the Credit Agreement is hereby amended by
deleting the table appearing in said Section in its entirety and inserting in
lieu thereof the following new table:
"Fiscal Quarter Ended Minimum Fixed Charge Ratio
--------------------- --------------------------
March 31, 1997 0.68:1.0
June 30, 1997 0.60:1.0
September 30, 1997 0.60:1.0
December 31, 1997 0.60:1.0
March 31, 1998 0.67:1.0
June 30, 1998 0.72:1.0
Each fiscal quarter
ended thereafter 0.80:1.0
; provided that should the Borrower fail to deliver the financial statements and
accompanying information for the fiscal quarter ended June 30, 1998 by July 20,
1998 as required by to Section 7.1(b), the Minimum Fixed Charge Ratio required
to be achieved (x) for the period ending June 30, 1998 shall be 0.80:1.0 and (y)
for each period ending after June 30, 1998 shall be respective amount as
provided in the Credit Agreement before giving effect to the Sixth Amendment, in
each case rather than the ratio set forth for such period in the table above."
11. Section 8.12 of the Credit Agreement is hereby amended by
(i) deleting the word "or" at the end of clause (iii) of said Section and
inserting in lieu thereof a comma and (ii) inserting immediately prior to the
period at the end of said Section the following new clauses:
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", (v) after any incurrence of Indebtedness pursuant to Section 8.3(l),
make (or give any notice in respect of) any voluntary or optional
payment or prepayment of principal on or voluntary or optional
redemption of or acquisition for value of, exchange or purchase, redeem
or acquire for value (whether as a result of a Change of Control, the
consummation of asset sales or otherwise) any of the Indebtedness
outstanding pursuant to the New Term Loan Agreement except payments or
prepayments with proceeds of sales or issuances of equity of
Communications or (vi) amend or modify, or permit the amendment or
modification of, any provision of the New Term Loan Agreement or the
other New Term Loan Documents other than (a) Permitted New Term
Facility Amendments and (b) modifications to the Collateral Documents
made in accordance with the respective terms and provisions thereof".
12. Section 9.1(c)(i) of the Credit Agreement is hereby
amended by inserting the phrase "or fail to deliver, by July 20, 1998, financial
statements and accompanying information for the fiscal quarter ended June 30,
1998 as required by Section 9.1(b)" immediately prior to the comma at the end
thereof.
13. The Banks hereby agree that if and when the New Term Loan
Agreement is entered into by the parties thereto and loans are made thereunder,
then Communications, the Borrower, the Subsidiary Guarantors and the Collateral
Agent shall be permitted (and are hereby authorized) (i) to enter into
amendments to the Pledge Agreement substantially in the form of Exhibit H-2
hereto, (ii) to enter into amendments to the Security Agreement substantially in
the form of Exhibit I-2 hereto, (iii) to enter into such amendments to the
Mortgages, the Canadian Debenture and the Canadian Pledge Agreement as they may
deem necessary and desirable in light of the New Term Loan Agreement so long as
any such amendments are consistent with the amendments described in clauses (i)
and (ii) of this Section 13, (iv) to enter into revised Lockbox Agreements,
Blocked Account Agreements and Concentration Account Agreements substantially in
the forms of Xxxxxxxx X-0, X-0 and D-3 hereto, respectively, and (v) to obtain
new Collateral Access Agreements in the form of Exhibit N hereto. Furthermore,
from and after the date of the occurrences described above in this Section 13,
and on a prospective basis, all Collateral Assignments of Equipment Purchase
Contracts shall be in the form of Exhibit B hereto, and any new Lockbox
Agreement, Blocked Account Agreement, Concentration Account Agreement or
Collateral Access Agreement shall be entered into in the forms of Xxxxxxxx X,
X-0, X-0, X-0 or N hereto, respectively, rather than in the forms originally
annexed as said Exhibits pursuant to the Credit Agreement.
14. In order to induce the Lenders to enter into this
Amendment, the Borrower hereby represents and warrants that (x) no Default or
Event of Default exists as of the Sixth Amendment Effective Date (as defined
below), both before and after giving effect to this Amendment and (y) all of the
representations and warranties contained in the Credit Agreement and the other
Credit Documents are true and correct in all material respects on the Sixth
Amendment Effective Date, both before and after giving effect to this Amendment,
with the same effect as though such representations and warranties had been made
on and as of the Sixth Amendment Effective Date (it being understood that any
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representation or warranty made as of a specific date shall be true and correct
in all material respects as of such specific date).
15. The Borrower hereby agrees to pay to the Agent for the
account of each Non-Defaulting Lender which has approved, executed and delivered
a copy of this Amendment as set forth in Section 20 hereof a fee equal to 1/5 of
1% of (x) such Lender's Revolving Loan Commitment in effect at the time of such
payment and (y) the principal amount of the Term Loans made by such Lender that
are outstanding at the time of such payment.
16. This Amendment is limited as specified and shall not
constitute a modification, acceptance or waiver of any other provision of the
Credit Agreement or any other Credit Document.
17. This Amendment may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which counterparts when executed and delivered shall be an original, but all
of which shall together constitute one and the same instrument. A complete set
of counterparts shall be lodged with the Borrower and the Agent.
18. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW
OF THE STATE OF NEW YORK.
19. This Amendment shall become effective on the date (the
"Sixth Amendment Effective Date") when each of Communications, the Borrower,
each Subsidiary Guarantor and the Required Lenders shall have signed a copy
hereof (whether the same or different copies) and shall have delivered
(including by way of facsimile transmission) the same to the Agent at 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention: Xxxxx Xxxxxxx.
20. From and after the Sixth Amendment Effective Date, all
references in the Credit Agreement and each of the other Credit Documents to the
Credit Agreement shall be deemed to be references to the Credit Agreement as
amended hereby.
* * *
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IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Amendment as of the date first
above written.
XXXXXXXX COMMUNICATIONS, INC.
By /s/ Xxxxxx Xxxxxx
-----------------------------
Title: Chief Financial Officer
XXXXXXXX GRAPHICS, INC.
By /s/ Xxxxxx Xxxxxx
-----------------------------
Title: Chief Financial Officer
BT COMMERCIAL CORPORATION,
Individually and as Agent
By /s/ Xxxxx Xxxxxxx
-----------------------------
Title: Vice President
BTM CAPITAL CORPORATION
By /s/ Xxxxx Xxxxxxx
-----------------------------
Title: Vice President
BNY FINANCIAL CORPORATION
(successor by merger to THE BANK
OF NEW YORK COMMERCIAL
CORPORATION)
By /s/
-----------------------------
Title:
DEUTSCHE FINANCIAL SERVICES
HOLDING CORP.
By /s/
----------------------------
Title:
FINOVA CAPITAL CORPORATION
By /s/
----------------------------
Title:
GIBRALTAR CORPORATION OF
AMERICA
By /s/
----------------------------
Title:
LASALLE NATIONAL BANK
By /s/
----------------------------
Title:
SANWA BUSINESS CREDIT
CORPORATION
By /s/
----------------------------
Title:
XXXXXX BUSINESS CREDIT
CORPORATION
By /s/
----------------------------
Title:
Each of the undersigned, each being a Subsidiary Guarantor pursuant to the
Credit Agreement referenced in the foregoing Amendment and a party to various
Collateral Documents, hereby acknowledges and agrees to the foregoing provisions
of the Amendment.
Acknowledged and
Agreed this _______ day
of _______, 1997.
AMERICAN IMAGES OF NORTH
AMERICA, INC.
By /s/
--------------------------
Name:
Title:
XXXXXXXX MARKETING, INC.
By /s/
--------------------------
Name:
Title:
XXXXXXXX MEDIA CORPORATION
By /s/
--------------------------
Name:
Title:
EXHIBIT A
SUMMARY OF CERTAIN TERMS
AND CONDITIONS
Borrower: Xxxxxxxx Graphics, Inc.
Agent: BTCo.
Collateral Agent: BTCC
Lenders: A syndicate of lenders (the "Lenders")formed by BTCo.
Term Loan Facility: Term loan facility in an aggregate principal amount
of $25 million (the "Term Loan Facility").
Maturity: The Term Loan Facility will mature on March 31, 2001
(the "Term Loan Maturity Date").
Use of Proceeds: The loans under the Term Loan Facility (the "Term
Loans") shall only be utilized to prepay outstandings
under the revolving loan facility pursuant to the
Existing Credit Agreement described below.
Availability: The Term Loans may only be incurred on the Term Loan
Borrowing Date. No amount of Term Loans once repaid
may be reborrowed.
Guaranties: The Term Loan Facility shall be guaranteed on the
same basis (although such guarantees shall be secured
by second priority security interests as described
under the heading "Security" below) as the Credit
Agreement, dated as of August 15, 1995, among
Communications, the Borrower, various financial
institutions (the "Existing Banks"), BT Commercial
Corporation, as Administrative Agent, and BTCo, as
such agreement is in effect on the date of the
Commitment Letter (the "Existing Credit Agreement"),
with each entity which guaranties the Term Loan
Facility herein called a "Guarantor".
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Security: The obligations of the Borrower and each Guarantor
shall be secured by a second priority perfected
security interest in all tangible and intangible
assets (including, without limitation, receivables,
contracts, contract rights, securities, intellectual
property, inventory, equipment and real estate) of
the Borrower and the Guarantors, which security
interests shall be junior to the security interests
of the lenders under the Existing Credit Agreement.
It is understood that, so long as there are any
outstandings pursuant to the Existing Credit
Agreement, that the lenders thereunder shall
generally control decisions with respect to the
collateral described above and the enforcement of
remedies with respect thereto.
All documentation evidencing the security required
pursuant to the immediately preceding paragraph shall
be in form and substance satisfactory to BTCo, and
shall effectively create second priority security
interests in the property purported to be covered
thereby.
Interest Rates: At the option of the Borrower, Term Loans may be
maintained from time to time as (x) Base Rate Loans
which shall bear interest at the Applicable Margin in
excess of the Base Rate in effect from time to time
or (y) Reserve Adjusted Eurodollar Loans which shall
bear interest at the Applicable Margin in excess of
the Eurodollar Rate (adjusted for maximum reserves)
as determined by BTCo for the respective interest
period, provided that Reserve Adjusted --------
Eurodollar Loans may not be incurred until the
earlier to occur of (x) the 60th day following the
Initial Borrowing Date and (y) that date upon which
BTCo has determined (and notifies the Borrower) that
the primary syndication of the Term Loan Facility
(and the resultant addition of institutions as
Lenders) has been completed; provided further that at
no time shall the per annum interest rate applicable
to any Term Loan exceed 18%.
"Base Rate" shall mean the higher of (x) 1/2 of 1% in
excess of the Federal Reserve reported certificate of
deposit rate and (y) the rate that BTCo announces
from time to time as its prime lending rate, as in
effect from time to time.
"Applicable Margin" shall mean a percentage per annum
which shall initially equal (x) in the case of
Reserve Adjusted Eurodollar Loans, 4.0% and (y) in
the case of Base Rate Loans, 3.0%; provided that the
Applicable Margins for each type of loan shall
increase on each
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three-month anniversary of the Term Loan Borrowing
Date in accordance with the table set forth below:
Applicable
Margin for
Reserve
Adjusted Applicable
Month Eurodollar Margin for
Anniversary Rate Loans Base Rate Loans
----------- ---------- ---------------
0 4.0% 3.0%
3 4.25% 3.25%
6 4.5% 3.5%
9 5.0% 4.0%
12 5.5% 4.5%
15 6.0% 5.0%
18 6.5% 5.5%
21 7.0% 6.0%
24 7.5% 6.5%
Interest periods of 1, 2, 3 or 6 months shall be
available in the case of Reserve Adjusted Eurodollar
Loans.
The Term Loan Facility shall include customary
protective provisions for such matters as defaulting
banks, capital adequacy, increased costs, actual
reserves, funding losses, illegality and withholding
taxes.
Interest in respect of Base Rate Loans shall be
payable quarterly in arrears on the last business day
of each fiscal quarter. Interest in respect of
Reserve Adjusted Eurodollar Loans shall be payable in
arrears at the end of the applicable interest period
and every three months in the case of interest
periods in excess of three months. Interest will also
be payable at the time of repayment of any Term Loans
and at maturity. All calculations of interest on Term
Loans and commitment fees shall be based on a 360-day
year and actual days elapsed.
Default Interest: Overdue principal, interest and other amounts shall
bear interest at a rate per annum equal to the
greater of (i) the rate which is 2% in excess of the
rate otherwise applicable to Base Rate Loans from
time to time and (ii) the rate which is 2% in excess
of the rate then
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borne by such borrowings. Such interest shall be
payable on demand.
Outstandings Fees: In addition to the amounts payable as described
above, if any Term Loans remain outstanding on either
the 12 or 30 month anniversary of the Term Loan
Borrowing Date, then on each such date an additional
cash fee shall be paid to BTCo (and retained by it or
distributed to the Lenders as agreed by them) in an
amount equal to 1.0% of the aggregate principal
amount of Term Loans then outstanding, and if any
Term Loans remain outstanding on either the 6, 9, 18
or 24 month anniversary of the Term Loan Borrowing
Date, then additional cash fees in an amount equal to
1/2 of 1% of the aggregate principal amount of Term
Loans then outstanding shall be paid on such date to
BTCo (and retained by it or distributed to the
Lenders as agreed by them).
Additional Fees: In addition to the foregoing, BTCo shall receive such
fees as have been separately agreed upon.
Mandatory
Prepayments: To be determined.
Documentation: The Lenders' commitments will be subject to the
negotiation, execution and delivery of definitive
financing agreements (and related security
documentation, guaranties, etc.) in connection with
the Term Loan Facility (the "Credit Documents")
reasonably con- sistent with the terms of the
Commitment Letter and this Summary of Terms, in each
case prepared by White & Case, counsel to BTCo.
Conditions
Precedent: In addition to conditions precedent typical for these
types of facilities and any other conditions
appropriate in the context of the proposed
transaction, the following conditions shall apply:
A. To the Initial Loans
(i) The Credit Documents shall have been executed and
delivered reflecting the terms and conditions set
forth in this Summary of Terms and shall otherwise be
in form and substance satisfactory to BTCo and the
Lenders, and all conditions to the making of the Term
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Loans set forth therein shall have been satisfied or
waived on or prior to the Term Loan Borrowing Date.
(ii) All necessary governmental (domestic and foreign) and
third party approvals in connection with the
Transaction shall have been obtained and remain in
effect (including, without limitation, the requisite
consents of the lenders under the Existing Credit
Agreement). Additionally, there shall not exist any
judgment, order, injunction or other restraint
prohibiting or imposing materially adverse conditions
upon, or making economically unfeasible, the
consummation of the Transaction.
(iii) Nothing shall have occurred (and the Lenders shall
have become aware of no facts or conditions not
previously known) which BTCo or the Lenders shall
reasonably determine could have a material ad- verse
effect on the rights or remedies of the Lenders or
BTCo, or on the ability of the Borrower to perform
its obligations to the Lenders or which could have a
materially adverse effect on the busi- ness,
property, assets, nature of assets, liabilities,
condition (xxxxx- cial or otherwise) or prospects of
Communications, the Borrower or Communications and
its subsidiaries taken as a whole.
(iv) No litigation by any entity (private or governmental)
shall be pending or threatened with respect to the
Transaction, the Term Loan Facility or any
documentation executed in connection therewith or
which BTCo or the Lenders shall reasonably determine
could have a materially adverse effect on the
business, property, assets, nature of assets,
liabilities, condition (financial or otherwise) or
prospects of Communications, the Borrower or
Communications and its subsidiaries taken as a whole
after giving effect to the Transaction.
(v) All Loans and other financing to the Borrower shall
be in full compliance with all requirements of
Regulations G, T, U and X of the Board of Governors
of the Federal Reserve System.
(vi) BTCo and the Lenders shall have received legal
opinions from counsel, and in form and substance and
covering matters, acceptable to BTCo and the Lenders,
including, without limitation, opinions from counsel
to the Borrower as to no conflicts with laws or
material agreements, the enforceability of the Credit
Documents and the matters described in clauses (vii)
and (ix) below.
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(vii) The guarantees and security agreements required as
described under the headings "Guarantees" and
"Security" above shall have been executed and
delivered in form, scope and substance reasonably
satisfactory to BTCo, and the Lenders shall have
second priority perfected security interest in all
assets as are required above.
(viii) A satisfactory intercreditor agreement shall have
been entered into, or satisfactory intercreditor
provisions shall have been agreed to, by the Lenders
party to the Existing Credit Agreement.
(ix) All Indebtedness under the Term Loan Facility shall
constitute "Senior Indebtedness" for all purposes
under the Senior Subordinated Note Indenture.
(x) There shall have been no material adverse change
after the date hereof to the syndication market for
credit facilities similar in nature to the Term Loan
Facility contemplated herein and there shall not have
occurred and be continuing a material disruption of
or material adverse change in financial, banking or
capital markets that would have a material adverse
effect on the syndication, in each case as determined
by BTCo in its sole discretion. The Borrower and
Communications and their respective advisors shall
have fully cooperated in the syndication efforts,
including, without limitation, by promptly providing
BTCo with all information deemed necessary by it to
successfully complete the syndication.
(xi) All costs, fees, expenses (including, without
limitation, legal fees and expenses) and other
compensation contemplated hereby or any letter
executed in connection herewith and payable to the
Lenders or BTCo (or their respective affiliates)
shall have been paid to the extent due.
(xii) Absence of default or unmatured default under the
Term Loan Facility, accuracy of representations and
warranties and receipt of such documentation as shall
be required by the Agent.
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Representations
and Warranties: The Term Loan Facility and related documentation
shall contain representations and warranties typical
for these types of facilities, as well as any
additional ones appropriate in the context of the
proposed transaction.
Covenants: Although the covenants have not yet been specifically
determined, we anticipate that, subject to such
deviations therefrom as are described in Annex I
hereto, the covenants shall be substantially similar
as those contained in the Senior Subordinated Note
Indenture, and in any event, will not be more
restrictive than those contained in the Existing
Credit Agreement (and related documentation). BTCo
reserves the right to further modify the covenants,
provided that no such modifications will result in
any covenant contained in the Credit Documents being
more restrictive than those contained in the Existing
Credit Agreement (and related documentation).
Events of Default: Those typical for these types of facilities
including, without limitation, payment, material
misrepresentations, covenant defaults, bankruptcy and
a change of control of Communications or the
Borrower.
Assignments and
Participations: The Borrower may not assign its rights or obligations
under the Term Loan Facility without the prior
written consent of the Agent and the Lenders. Any
Lender may assign, and may sell parti- cipations in,
its rights and obligations under the Term Loan
Facility, subject (x) in the case of participations,
to customary restrictions on the voting rights of the
participants and (y) in the case of assignments, to a
minimum assignment requirement of $2,000,000 (or to
the extent the amount held by such Lender is less
than $2,000,000, such lesser amount) and such other
limitations as may be established by the Agent (which
in any event shall require the consent of the Agent,
not to be unreasonably withheld, to assignments). The
Term Loan Facility shall provide for a mechanism
which will allow for each assignee to become a direct
signatory to the Term Loan Facility and will relieve
the assigning Lender of its obligations with respect
to the assigned portion of its commitment.
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Governing Law: The rights and obligations of the parties under the
Credit Documents shall be construed in accordance
with and governed by the law of the State of New
York.
Required Lenders: Majority; provided that until the first date on or
after the Term Loan Borrowing Date upon which BTCo
and its affiliates own less than a majority of the
outstanding Term Loans, the Required Lenders shall be
required to include (if there are any Lenders other
than BTCo and its affiliates) at least one lender
which is not BTCo or an affiliate thereof.
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ANNEX I TO SUMMARY OF TERMS
COVENANTS
The covenants applicable to the Term Loan Facility will in no event be more
restrictive than those contained in the Existing Credit Agreement. Although the
covenants have not yet been specifically determined, BTCo anticipates that,
subject to the deviations set forth below, the covenants shall be substantially
similar to those contained in the Senior Subordinated Note Indenture as defined
in the Existing Credit Agreement. Subject to the first sentence above, BTCo
reserves the right to further modify the covenants applicable to the Term Loan
Facility. In describing the covenants below, references are to Post-Effective
Amendment No. 2 to Form S-1, as filed by Xxxxxxxx Communications, Inc. and
Xxxxxxxx Graphics, Inc. with the SEC on July 12, 1996.
1. Limitation on Indebtedness -
i) clause (a) to be deleted.
ii) sub-clause (a)(x) in clause (b)(1) to be deleted.
iii) dollar limits to be established for Indebtedness incurred
pursuant to clauses (b)(11), (12) and (13).
iv) the $25 million basket amount provided in clause (b)(14)
to be allocated to Term Loan Facility.
2. Limitation on Restricted Payments - All payments with respect to
subordinated debt to constitute Restricted Payments. Restricted Payments will be
strictly limited, with the precise terms of the covenant to be agreed.
3. Limitation on Sales of Assets and Subsidiary Stock - The covenant
would be modified to require that the Term Loan Facility be repaid in full
before any amounts are applied to repay Senior Subordinated Notes or any other
Subordinated Indebtedness.
4. Change of Control Triggering Event - The Covenant would be modified
to delete the requirement of a Rating Decline in connection with a Change of
Control Triggering Event. As a result, upon a Change of Control, whether or not
a Rating Decline has occurred, the covenant would apply in accordance with its
terms. Additionally, at the option of BTCo, the covenant shall be structured as
a mandatory repayment, rather than an offer to purchase.
ANNEX I TO SUMMARY OF TERMS
Page 2
5. Successor Company - Transactions of the type described in this
covenant shall be strictly limited, with the precise terms of the covenant to be
agreed.
