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EXHIBIT 10.21
EXECUTION COPY
AMENDMENT NO. 1 TO AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDMENT NO. 1 ("Amendment No. 1") is made as of the 8th day of
May, 1997 by and among MEMBERWORKS INCORPORATED (formerly known as CardMember
Publishing Corporation), a Delaware corporation (the "Company"), the lenders
signatory hereto (the "Lenders") and XXXXX BROTHERS XXXXXXXX & CO., as agent
(in such capacity, the "Agent") for the Lenders.
W I T N E S S E T H:
WHEREAS, the parties hereto have entered into an Amended and Restated
Credit Agreement dated as of April 8, 1996 (the "Credit Agreement"); and
WHEREAS, the parties desire to amend the Credit Agreement as
hereinafter set forth;
NOW, THEREFORE, the parties hereby agree as follows:
SECTION 1. DEFINITIONS. Except as otherwise defined herein, capitalized
terms used herein have the meanings provided in the Credit Agreement.
SECTION 2. AMENDMENT. Subject to the satisfaction of the conditions
precedent specified below, but effective as of the date hereof, the Credit
Agreement shall be amended as follows:
(a) All references in the Credit Agreement to "CardMember
Publishing Corporation" shall mean "MemberWorks Incorporated."
(b) Section 1.1 of the Credit Agreement shall be amended as
follows:
(1) The following definition shall be added after the
definition of "Closing Date": "'CMC' shall mean CardMember Marketing
Corporation, a Delaware corporation."
(2) The following definition shall be added after the
definition of "control": "'CPC' shall mean CardMember Publishing Corporation, a
Delaware corporation."
(3) The following definition shall be added after the
definition of "CPC": "'CSC' shall mean CardMember Services Corporation, a
Delaware corporation."
(4) The definition of "Maximum Amount" shall be amended
by deleting the reference therein to "$3,000,000" and replacing it with
"$7,000,000."
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(5) The definition of "Related Documents" shall be
amended by deleting the reference therein to ", the Shareholder Guaranty, the
Shareholder Pledge Agreement."
(6) The definitions of "Shareholder Guarantee" and
"Shareholder Pledge Agreement" are hereby deleted in their entirety.
(7) The following definition shall be added after the
definition of "Subsidiary Security Agreement": "'Travel Too' shall mean Travel
Too Ltd., a Delaware corporation."
(c) Section 2.6 of the Credit Agreement shall be amended by
deleting the words "plus the applicable margin" in the first sentence thereof
and by deleting the second sentence thereof in its entirety.
(d) Section 3.1(b) of the Credit Agreement shall be amended by
deleting the reference therein to "1.0%" and replacing it with ".5%".
(e) Section 5.1 of the Credit Agreement shall be amended as
follows:
(1) Section 5.1(a) of the Credit Agreement is hereby
amended by deleting the first word of such Section and adding the words "Except
as set forth on Schedule 5.1, the" before the second word thereof.
(2) Section 5.1(c) is hereby amended by deleting the
first word of such Section and inserting the words "Except as set forth on
Schedule 5.1, the" before the second word thereof.
(f) Section 5.3 of the Credit Agreement shall be amended by
deleting the last three sentences thereof in their entirety and replacing them
with "The Company has no subsidiaries except IMPAQ, Countrywide Dental, Inc.,
Travel Too and CPC. None of IMPAQ, Countrywide Dental, Inc. or Travel Too have
any Subsidiaries. CPC has two wholly owned Subsidiaries, CSC and CMC. IMPAQ
owns a 50% interest in RSVP".
(g) Section 5.8 of the Credit Agreement shall be amended by
deleting the first word of such Section and adding the words "Except as set
forth on Schedule 5.8, neither" before the second word thereof.
(h) Section 5.9(a) of the Credit Agreement shall be amended by
deleting the first word of such Section and adding the words "Except as set
forth on Schedule 5.9, the" before the second word thereof and by deleting the
words "and none of such property is subject to any Lien" in their entirety.
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(i) Section 5.17 shall be amended by deleting the reference to
the Shareholder Pledge Agreement in the first sentence thereof.
(j) Section 5.19 of the Credit Agreement shall be amended by
deleting the first word of such Section and adding the words "Except as set
forth on Schedule 5.19, since" immediately before "June 30, 1994."
(k) Schedule 5.1, attached hereto, is hereby added to the
Credit Agreement.
(l) Schedule 5.7 to the Credit Agreement is hereby deleted in
its entirety and replaced with Schedule 5.7 attached hereto.
(m) Schedule 5.8, attached hereto is hereby added to the Credit
Agreement.
(n) Schedule 5.9, attached hereto, is hereby added to the
Credit Agreement.
(o) Schedule 5.18 to the Credit Agreement is hereby deleted in
its entirety and replaced with Schedule 5.18 attached hereto.
(p) Schedule 5.19, attached hereto, is hereby added to the
Credit Agreement.
(q) Exhibits D and E to the Credit Agreement are hereby deleted
in their entirety.
SECTION 3. RELEASE OF SHAREHOLDER GUARANTEE AND SHAREHOLDER PLEDGE
AGREEMENT. The Collateral Agent hereby confirms that it has, with the
permission of all of the Lenders, released the Shareholders from the
Shareholder Guarantee and the Shareholder Pledge Agreement and returned all
collateral pledged under the Shareholder Pledge Agreement.
SECTION 4. REPRESENTATIONS AND WARRANTIES; NO DEFAULT. The Company
represents and warrants to the Lenders and the Agent that (i) the
representations and warranties set forth in the Credit Agreement (as amended
hereby) are true and complete on the date hereof as if made on and as of the
date hereof (or, if any such representation or warranty is expressly stated to
have been made as of a specific date, as of such specific date).
SECTION 5. CONDITIONS PRECEDENT. As provided in Section 2 above, the
amendment to the Credit Agreement set forth in said Section 2 shall become
effective, as of the date hereof, upon the satisfaction of the following
conditions precedent:
(a) Execution by All Parties. This Amendment No. 1 shall have been
executed and delivered by each of the parties hereto.
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(b) Note. A Note payable to the order of Xxxxx Brothers Xxxxxxxx & Co.
in the principal amount of $7,000,000 shall have been executed and delivered by
the Company.
(c) Subsidiary Guarantee. A Subsidiary Guarantee, in the form of
Exhibit F to the Credit Agreement, shall be executed by each of CPC, CMC, CSC
and Travel Too guaranteeing, on a joint and several basis, the payment of the
Obligations.
(d) Subsidiary Security Agreement. Subsidiary Security Agreements, in
the form of Exhibit G to the Credit Agreement, shall be executed by each of
CPC, CMC, CSC and Travel Too securing each such Subsidiaries' obligations under
the Subsidiary Guarantee.
(e) Amendment No. 2 to Security Agreement. Amendment No. 2 to the
Security Agreement shall have been executed and delivered by the parties hereto.
(f) Supporting Documents. The Agent shall have received, with
sufficient copies for each Lender, the following documents, each of which shall
be satisfactory to the Agent and the Lenders in form and substance:
(1) Corporate Documents. The following documents, each certified
as indicated below:
(A) a copy of any amendments to the charter of the
Company since April 8, 1996, certified by the Secretary of State
of Delaware; and
(B) a certificate of the Secretary or an Assistant
Secretary of the Company dated as of a recent date and
certifying (i) that attached thereto is a true and complete copy
of resolutions duly adopted by the board of directors of the
Company authorizing the execution, delivery and performance of
this Amendment No. 1 and the Credit Agreement as amended hereby
and that such resolutions have not been modified, rescinded or
amended and are in full force and effect, (ii) that the charter
of the Company has not been amended since the date of the
certification thereto furnished pursuant to clause (A) above and
that the by-laws of the Company have not been amended since the
date a certified copy thereof was delivered pursuant to
subsection 4.1(f) of the Credit Agreement, and (iii) as to the
incumbency and specimen signature of each officer of the Company
executing this Amendment No. 1.
(C) a certificate of the Secretary or an Assistant
Secretary of each of CPC, CMC, CSC and Travel Too certifying as
to the incumbency and specimen signatures of each officer
authorized to sign on its behalf the related Documents to which
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it is a party and to which are attached copies, certified to be
true, correct and complete and in full force and effect of (i)
its charter, (ii) its by-laws and (iii) resolutions of its Board
of Directors authorizing its execution delivery and performance
of the Related Documents to which it is a party.
(D) Good Standing certificates for the Company, and each
of CPC, CMC, CSC and Travel Too from the Secretary of the State
of their respective jurisdictions of incorporation.
(E) an opinion of counsel to each of the Company, CPC,
CMC, CSC and Travel Too that this Amendment and each of the
Related Documents being executed in connection herewith to which
it is a party are within its corporate power and authority, have
been duly authorized, executed and delivered and constitute its
legal, valid, binding and enforceable obligation.
(2) Other Documents. Such other documents (including any Form
UCC Financing Statements) as the Agent or any Lender may reasonably
request.
(g) Fees and Expenses.
(1) Upon execution of this Amendment No. 1, the Company shall
pay to the Agent for its own account a closing fee of $20,000.
(2) The Company shall have paid to the Agent all reasonable
out-of-pocket expenses, including the fees and disbursements of Xxxxxx &
Xxxxx, counsel to the Agent, incurred by the Agent in connection with
the preparation, execution and delivery of Amendment No. 1 and each of
the other documents and instruments contemplated hereby
SECTION 6. MISCELLANEOUS. Except as herein provided, the Credit
Agreement shall remain unchanged and in full force and effect. This Amendment
No. 1 may be executed in any number of counterparts, all of which taken
together shall constitute one and the same amendatory instrument and any of the
parties hereto may execute this Amendment No. 1 by signing any such
counterpart. THIS AMENDMENT NO. 1 SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1
to be duly executed and delivered as of the day and year first above written.
MEMBERWORKS INCORPORATED
By: /s/ Xxxxx X. Xxxxx
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Name: Xxxxx X. Xxxxx
Title: Treasurer and Secretary
per pro XXXXX BROTHERS XXXXXXXX & CO.,
as Agent, Collateral Agent and Lender
/s/ X. Xxxxxx Xxxxxxxx III
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Name: X. Xxxxxx Xxxxxxxx III
Title: Senior Manager
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FINANCIAL CONDITION
(a) The Company restated is financial statements in 1996 (the "1996
Restatement") which restatement affected the financial statements for years
1992 - 1995.
(b) The projections were affected as a result of the 1996 Restatement and should
not be relied upon.
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SCHEDULE 5.7
MATERIAL LITIGATION
The lawsuit involving Xxxxxx St. Denis was settled and dismissed.
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SCHEDULE 5.8
NO DEFAULT
The representation and warranties in the Related Documents are not being updated
for purposes of this Amendment No. 1 to the Amended and Restated Credit
Agreement.
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SCHEDULE 5.9
LIENS
1. Liens disclosed by UCC-1 Financing Statements of record.
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SCHEDULE 5.18
LIST OF EMPLOYMENT AGREEMENTS
The Agreement dated as of July 31, 1989 between the Company and Xxxxxx St. Xxxxx
was terminated and the Company was released from further obligations thereunder
pursuant to the settlement of the litigation referenced in SCHEDULE 5.7.
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DIVIDENDS
In connection with the Company's initial public offering, the Company redeemed
the Series E and F Preferred Stock and paid all dividends accrued and unpaid
thereon.
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