Exhibit 10.1
WAIVER AND THIRD AMENDMENT TO CREDIT AGREEMENT
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This WAIVER AND THIRD AMENDMENT TO CREDIT AGREEMENT (the "Waiver") is
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entered into as of November 15, 2001, among Xxxxxx Communications, Inc.,
formerly known as Xxxxxx Companies Inc., a Washington corporation (the
"Company"), the several financial institutions from time to time party to the
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Credit Agreement described below (collectively, the "Lenders"; individually, a
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"Lender") and Bank of America, N.A., formerly known as Bank of America National
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Trust and Savings Association, as administrative agent for the Lenders (the
"Agent").
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RECITALS
WHEREAS, the Lenders, the Company, the Agent and Credit Suisse First
Boston, as syndication agent, are parties to that certain Credit Agreement dated
as of June 24, 1999, as amended by that certain First Amendment to Credit
Agreement dated as of August 24, 1999 and by that certain Second Amendment to
Credit Agreement dated as of September 30, 1999 (as the same has been or may be
amended, modified or extended from time to time the "Credit Agreement");
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WHEREAS, the Credit Agreement contains certain financial covenants binding
upon the Company, and it is known that the Company was in breach of the Adjusted
Leverage Ratio and Interest Coverage Ratio set forth in the Credit Agreement as
of its fiscal quarter ended September 30, 2001 and was in breach of the Net
Capital Expenditure limitation set forth in the Credit Agreement for the fiscal
year ending December 31, 2001;
WHEREAS, the Company has requested that the Agent and the Lenders waive
such defaults, which the Agent and Majority Lenders have agreed to do upon the
terms and conditions set forth in this Waiver;
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the parties agree as follows:
AGREEMENT
1. Definitions. Unless otherwise defined herein, capitalized terms used
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herein shall have the meanings, if any, assigned to them in the Credit
Agreement.
2. Waiver of Defaults.
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(a) Financial Covenants. Subject to the terms and conditions of this
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Waiver, the Agent and Majority Lenders hereby waive the Company's compliance
with its obligations under Section 6.15(a) and Section 6.15(b) of the Credit
Agreement as of the Company's fiscal quarter ended September 30, 2001.
(b) Capital Expenditures. Subject to the terms and conditions of this
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Waiver, the Agent and Majority Lenders hereby waive the Company's compliance
with its obligations under Section 7.12 of the Credit Agreement for the period
commencing January 1, 2001 through the Closing Date.
3. Consent to Dividends. The Agent and Majority Lenders hereby
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acknowledge that the Company has paid cash dividends in the approximate amount
of $6,750,000 in the calendar year 2001 prior to the date of this Waiver and
intends to pay additional cash dividends in the approximate amount of $2,250,000
on or about December 7, 2001. To the extent required, the Agent and Majority
Lenders hereby consent to the declaration and payment of such dividends.
4. Amendments to Credit Agreement. The Credit Agreement is amended as
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follows:
(a) Amendment to Definitions. In Section 1.01, the definition of
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"Applicable Margin" is hereby deleted and the following substituted in its
stead:
"Applicable Margin" means on any date, a per annum interest rate
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determined in accordance with the following table:
Applicable Applicable
Company's Margin For Margin For
Leverage Rating Offshore Rate Base Rate
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Xxxxx 0 2.25% 0.00%
Xxxxx 0 2.50% 0.00%
Xxxxx 0 2.75% 0.25%
Xxxxx 0 3.00% 0.50%
Xxxxx 0 3.25% 0.75%
Xxxxx 0 3.50% 1.00%
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(b) Amendment to Section 7.12. In Section 7.12, the table therein
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contained is hereby deleted and the following substituted in its stead:
Fiscal Year Ending Amount
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December 31, 1999 $20,000,000
December 31, 2000 $30,000,000
December 31, 2001 $27,000,000
December 31, 2002 $25,000,000
and each fiscal year
ending thereafter
And the last sentence of Section 7.12 is hereby deleted and the following
substituted in its stead:
Notwithstanding the foregoing to the contrary, the Company and its
Subsidiaries shall be permitted to (a) make additional expenditures solely
for the construction of the Xxxxxx Plaza in the aggregate amount of
Eighty-five Million Dollars ($85,000,000) during the fiscal years ending
December 31, 1999, December 31, 2000 and December 31, 2001 and (b) make
additional Net Capital Expenditures during the fiscal year ending December
31, 2001 in an amount not to exceed the amount by which (i) the sum of the
maximum expenditure amounts for the fiscal years ending December 31, 1999
and December 31, 2000 set forth in the above table exceeds (ii) the actual
amount of the Net Capital Expenditures made in the fiscal years ending
December 31, 1999 and December 31, 2000.
5. Amendment to Pledge Agreement. The Pledge Agreement is amended as
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follows:
(a) Amendment to Section 5. In Section 5, the first sentence of
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subsection (n) is hereby deleted and the following substituted in its stead:
The authorized capital stock of Broadcasting consists of 35,000
shares of participating preferred stock, par value of $30.00, of which
32,343.5 shares are issued and outstanding; and 35,000 shares of common
stock, par value of $30.00, all of which are issued and outstanding.
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(b) Amendment to Schedule 1. Schedule 1 attached to the Pledge
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Agreement is hereby deleted and Schedule 1 attached hereto is substituted in
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its stead
6. Delivery of Compliance Certificate. The Company hereby agrees to
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furnish to the Agent on or before January 31, 2002, with sufficient copies for
the Agent and each Lender, a Compliance Certificate executed by a Responsible
Officer substantially in the form of Exhibit A certifying that as of the fiscal
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year ended December 31, 2001 no Default or Event of Default had occurred and was
continuing, and, further, setting forth calculations demonstrating compliance as
at the end of such fiscal year with the financial covenants set forth in Section
6.15 and 7.12. The Company expressly agrees that it shall be an additional Event
of Default under the Credit Agreement if any representation or warranty made
hereunder shall prove to have been incorrect in any material respect when made.
7. Payment of Fees.
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(a) Waiver Fee. The Company hereby agrees to pay to the Agent for the
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account of each Lender that executes and delivers to the Agent a counterpart of
this Waiver (each, a "Waiver Lender") a waiver fee equal to one-tenth of one
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percent (0.10%) of the amount of such Lender's Commitment. The waiver fee
described in this Section 7(a) shall be payable (a) to each Waiver Lender (other
than BofA) on the Closing Date (as defined below) and (b) to BofA on January 31,
2002 if on such date any Lender shall have any Commitment under the Credit
Agreement, or any Loan or other Obligation (other than Permitted Swap
Obligations) shall remain unpaid or unsatisfied. The waiver fees payable under
this Section 7(a) shall be deemed fully earned when due and non-refundable when
paid.
(b) Arrangement Fee. The Company hereby agrees to pay to the Lead
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Arranger and Sole Book Manager for the Lead Arranger and Sole Book Manager's own
account, an arrangement fee as set forth in the letter agreement between the
Company and the Lead Arranger and Sole Book Manager dated November 15, 2001. The
arrangement fee described in this Section 7(b) shall be payable to the Lead
Arranger and Sole Book Manager on the Closing Date. The arrangement fee payable
under this Section 7(b) shall be deemed fully earned when due and non-refundable
when paid.
8. Representations and Warranties. The Company hereby represents and
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warrants to the Agent and the Lenders as follows:
(a) No Default or Event of Default (other than those
waived by this Amendment) has occurred and is continuing.
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(b) The execution, delivery and performance by the Company of this
Waiver do not and will not require any registration with, consent or approval
of, notice to or action by, any Person (including any Governmental Authority) in
order to be effective and enforceable. The Credit Agreement as amended by this
Waiver constitutes the legal, valid and binding obligations of the Company,
enforceable against it in accordance with its respective terms, without defense,
counterclaim or offset.
(c) All representations and warranties of the Company contained in
the Credit Agreement (as amended by this Waiver) are true and correct.
(d) The Company is entering into this Waiver on the basis of its own
investigation and for its own reasons, without reliance upon the Agent and the
Lenders or any other Person.
9. Effective Date. This Waiver will become effective as of November 1,
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2001 (the "Closing Date"); provided that each of the following conditions
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precedent is satisfied:
(a) Delivery of Waiver. The Agent has received from the Company and
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Lenders constituting Majority Lenders a duly executed original (or, if elected
by the Agent, an executed facsimile copy) of this Waiver;
(b) Payment of Fees. The Agent (for the account of the Lenders) has
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received from the Company the waiver fees payable on the Closing Date as set
forth in Section 7 hereof;
(c) Guarantor Consent. Xxxxxx Broadcasting Inc., Xxxxxx Xxxxx, Inc.
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and Xxxxxx Properties Inc. shall have each executed the subjoined Guarantor
Acknowledgment and Consent; and
(d) Other Documents. The Agent and each Lender a party hereto shall
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have received such other documents, instruments, and undertakings as the Agent
and such Lender may reasonably request.
10. Company Resolutions. The Company agrees to deliver to the Agent on or
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before December 11, 2001 a copy of a resolution passed by the board of directors
of the Company, certified by the Secretary or an Assistant Secretary of the
Company, ratifying the execution, delivery and performance of this Waiver. The
Company further agrees that it shall be an additional Event of Default under the
Credit Agreement if the Company shall fail to deliver such resolutions to the
Agent on or before such date.
11. Reservation of Rights. The Company acknowledges and agrees that the
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execution and delivery by the Agent and the Lenders of this Waiver shall not be
deemed to create a course of dealing or otherwise obligate the Agent or any
Lender to forbear or execute similar amendments under the same or similar
circumstances in the future.
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12. Miscellaneous.
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(a) No Further Amendment. Except as herein expressly amended, all
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terms, covenants and provisions of the Credit Agreement are and shall remain in
full force and effect and all references therein to such Credit Agreement shall
henceforth refer to the Credit Agreement as amended by that certain First
Amendment to Credit Agreement dated as of August 24, 1999, by that certain
Second Amendment to Credit Agreement dated as of September 30, 1999 and by this
Waiver.
(b) Successors and Assigns. This Waiver shall be binding upon and
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inure to the benefit of the parties hereto and their respective successors and
assigns. No third party beneficiaries are intended in connection with this
Waiver.
(c) Governing Law. This Waiver shall be governed by and construed
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in accordance with the law of the State of Washington, excluding its conflict of
laws rules.
(d) Counterparts. This Waiver may be executed in any number of
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counterparts, each of which shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument. Each of
the parties hereto understands and agrees that this document (and any other
document required herein) may be delivered by any party thereto either in the
form of an executed original or an executed original sent by facsimile
transmission to be followed promptly by mailing of a hard copy original, and
that receipt by the Agent of a facsimile transmitted document purportedly
bearing the signature of a Lender or the Company shall bind such Lender or
Company, respectively, with the same force and effect as the delivery of a hard
copy original. Any failure by the Agent to receive the hard copy executed
original of such document shall not diminish the binding effect of receipt of
the facsimile transmitted executed original of such document of the party whose
hard copy page was not received by the Agent.
(e) Entire Agreement. The Waiver, together with the Credit
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Agreement, contains the entire and exclusive agreement of the parties hereto
with reference to the matters discussed herein and therein. This Waiver
supercedes all prior drafts and communications with respect thereto. This Waiver
may not be amended except in accordance with the provisions of Section 10.01 of
the Credit Agreement.
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(f) Severability. If any term or provision of this Waiver shall be
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deemed prohibited by or invalid under any applicable law, such provision shall
be invalidated without affecting the remaining provisions of this Waiver or the
Credit Agreement, respectively.
(g) Payment of Expenses. The Company covenants to pay or to
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reimburse the Agent and the Lenders, upon demand, for all reasonable costs and
expenses (including allocated costs of in-house counsel) incurred in connection
with the development, preparation, negotiation, execution and delivery of this
Waiver, including without limitation appraisal, audit, search and filing fees
incurred in connection therewith.
12. Oral Agreements Not Enforceable.
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ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR TO
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FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER
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WASHINGTON LAW.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Seattle, Washington by their proper and duly
authorized officers as of the day and year first above written.
XXXXXX COMMUNICATIONS, INC.,
formerly known as Xxxxxx Companies Inc.
By:____________________________________________
Title:_________________________________________
BANK OF AMERICA, N.A., formerly known as Bank
of America National Trust and Savings
Association, as Agent
By:____________________________________________
Title:_________________________________________
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BANK OF AMERICA, N.A., formerly known as
Bank of America National Trust and
Savings Association, as Lender
By:____________________________________
Title:_________________________________
U.S. BANK NATIONAL ASSOCIATION, as a
Lender
By:____________________________________
Title:_________________________________
CREDIT SUISSE FIRST BOSTON, as a Lender
By:____________________________________
Title:_________________________________
By:____________________________________
Title:_________________________________
FLEET NATIONAL BANK, formerly known as
BankBoston, N.A., as a Lender
By:____________________________________
Title:_________________________________
THE BANK OF NOVA SCOTIA, as a Lender
By:____________________________________
Title:_________________________________
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BANK OF MONTREAL, as a Lender
By:____________________________________
Title:_________________________________
KEY CORPORATE CAPITAL INC., as a Lender
By:____________________________________
Title:_________________________________
THE BANK OF NEW YORK, as a Lender
By:____________________________________
Title:_________________________________
UNION BANK OF CALIFORNIA, N.A., as a
Lender
By:____________________________________
Title:_________________________________
THE FUJI BANK, LIMITED,
LOS ANGELES AGENCY, as a Lender
By:____________________________________
Title:_________________________________
CITY NATIONAL BANK, as a Lender
By:____________________________________
Title:_________________________________
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CREDIT SUISSE FIRST BOSTON,as
Syndication Agent
By:____________________________________
Title:_________________________________
By:____________________________________
Title:_________________________________
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GUARANTOR ACKNOWLEDGMENT AND CONSENT
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The undersigned, each a guarantor with respect to the Company's
obligations to the Agent and the Lenders under the Credit Agreement, each hereby
(i) acknowledge and consent to the execution, delivery and performance by
Company of the foregoing Waiver and Third Amendment to Credit Agreement (the
"Waiver"), and (ii) reaffirm and agree that the respective guaranty, third party
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pledge or security agreement to which the undersigned is party and all other
documents and agreements executed and delivered by the undersigned to the Agent
and the Lenders in connection with the Credit Agreement are in full force and
effect, without defense, offset or counterclaim. (Capitalized terms used herein
have the meanings specified in the Waiver.)
XXXXXX BROADCASTING COMPANY,
formerly known as Xxxxxx
Broadcasting Inc.
Dated: ______________________ By: _______________________________
Title: ____________________________
XXXXXX XXXXX INC.
Dated: ______________________ By: _______________________________
Title: ____________________________
XXXXXX PROPERTIES INC.
Dated: ______________________ By: _______________________________
Title: ____________________________
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SCHEDULE 1
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TO
AUTHORIZED SHARES OF XXXXXX BROADCASTING COMPANY.
(successor by name change to Xxxxxx'x Blend Station, Inc.)
Number Number Number
Class of of of Shares
Of Shares Shares Owned by
Stock Issued Outstanding Pledgor
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Common 35,000 35,000 35,000
Partic- 32,343.5 32,343.5 32,343.5
ipating
Preferred
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EXHIBIT A
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XXXXXX COMMUNICATIONS INC.
COMPLIANCE CERTIFICATE
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Financial
Statement Date: December 31, 2001
Reference is made to that certain Credit Agreement dated as of June 24,
1999 (as extended, renewed, amended or restated from time to time, the "Credit
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Agreement") among XXXXXX COMMUNICATIONS INC., formerly known as Xxxxxx Companies
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Inc., a Washington corporation (the "Company"), the several financial
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institutions from time to time parties to this Credit Agreement (the "Lenders")
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and Bank of America, N.A., formerly known as Bank of America National Trust and
Savings Association, as agent for the Banks (in such capacity, the "Agent").
Unless otherwise defined herein, capitalized terms used herein have the
respective meanings assigned to them in the Credit Agreement.
The undersigned Responsible Officer of _______________, hereby
certifies as of the date hereof that he/she is the ________________ of the
Company, and that, as such, he/she is authorized to execute and deliver this
Certificate to the Lenders and the Agent on the behalf of the Company and its
consolidated Subsidiaries, and that:
[1. Attached as Schedule 1 hereto are (a) a true and correct copy of
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the unaudited consolidated balance sheet of the Company and its consolidated
Subsidiaries as of the end of the fiscal year ended December 31, 2001, and (b)
the related unaudited consolidated statements of income, shareholders' equity
and retained earnings for such fiscal year, and certified by a Responsible
Officer that such financial statements were prepared in accordance with GAAP
(subject only to ordinary, good faith year-end audit adjustments and the absence
of footnotes) and fairly present, in all material respects, the financial
position and the results of operations of the Company and its consolidated
Subsidiaries.]
2. The undersigned has reviewed and is familiar with the terms of the
Credit Agreement and has made, or has caused to be made under his/her
supervision, a detailed review of the transactions and conditions (financial or
otherwise) of the Company during the accounting period covered by the attached
financial statements.
3. The undersigned has no knowledge of any Default or Event of Default.
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4. The following financial covenant analyses and information set forth on
Schedule 2 attached hereto are true and accurate on and as of the date of
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this Certificate.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
January _____, 2002.
XXXXXX COMMUNICATIONS INC., formerly
known as Xxxxxx Companies Inc.
By: ______________________________________
Title: ___________________________________
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Date: January _____, 2002
For the fiscal year ended
December 31, 2001
SCHEDULE 2
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to the Compliance Certificate
($ in 000's)
[Calculations demonstrating compliance as at the end
of the 2001 fiscal year with the financial covenants set
forth in Section 6.15 and 7.12 of the Credit Agreement]
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