EXHIBIT 10.1
FOURTH AMENDMENT TO CREDIT AGREEMENT
AND REAFFIRMATION AGREEMENT
THIS FOURTH AMENDMENT TO CREDIT AGREEMENT AND REAFFIRMATION AGREEMENT
(this "Amendment") is entered into as of July 13, 2001, by and among Ziff Xxxxx
Media Inc., a Delaware corporation (the "Borrower"), CIBC World Markets Corp.,
as lead arranger and bookrunner (the "Lead Arranger"), Bankers Trust Company, as
syndication agent (the "Syndication Agent"), Fleet National Bank, as
documentation agent (the "Documentation Agent"), Canadian Imperial Bank of
Commerce, as administrative agent (the "Administrative Agent") and the other
Credit Parties signatory hereto (the "Credit Parties").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Borrower, the Lead Arranger, the Syndication Agent, the
Documentation Agent, the Administrative Agent and the Credit Parties are parties
to that certain Credit Agreement dated as of April 5, 2000, as amended by that
certain First Amendment to Credit Agreement dated as of June 12, 2000, as
amended by that certain Second Amendment to Credit Agreement dated as of July
19, 2000, as amended by that certain Third Amendment to Credit Agreement dated
as of January 22, 2001 (as the same may be amended, restated, supplemented or
otherwise modified from time to time, the "Credit Agreement"); and
WHEREAS, the Borrower has requested, and the Lead Arranger, the
Syndication Agent, the Documentation Agent, the Administrative Agent and the
Credit Parties have agreed, (a) to waive certain Defaults and Events of Default
and (b) to amend the Credit Agreement, in each case, to the extent set forth
herein;
NOW THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree that all capitalized terms used herein shall have the meanings ascribed
thereto in the Credit Agreement, as amended hereby, except as otherwise defined
or limited herein, and further agree, subject to the conditions precedent to
this Amendment hereinafter set forth, as follows:
1. Amendments to Article 1.
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(a) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by adding the following new definitions in appropriate
alphabetical order:
"'Amendment Period' shall mean the period from and including June 30,
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2001 through and including September 30, 2002.
"'*Joint Venture' shall mean any directly-owned joint venture
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Subsidiary formed by the Borrower or any of its Subsidiaries with respect
to one or more of the *Publications and of which a portion of the Equity
Interests therein are owned by one or more Persons other than the Borrower,
any of its Subsidiaries or any member of management.
"'*Publications' shall mean, collectively*.
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"'eTesting Labs' shall mean eTesting Labs, Inc., Inc., a Delaware
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corporation.
"'Expedia Travels Joint Venture' shall mean any directly-owned joint
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venture Subsidiary formed by LaunchCo or any of its Subsidiaries with
respect to the assets and liabilities of LaunchCo relating to the Expedia
Travels publication and of which a portion of the Equity Interests therein
are owned by one or more Persons other than the Borrower, any of its
Subsidiaries or any member of management.
"'Fourth Amendment Date' shall mean July 13, 2001.
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"InternetCo Release Date' shall have the meaning set forth in Section
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5.16 hereof.
"'Joint Venture Subsidiaries' shall mean, collectively, the *Joint
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Ventures, the Permitted InternetCo Joint Ventures and the LaunchCo Joint
Ventures.
"'Permitted InternetCo Joint Ventures' shall have the meaning set
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forth in Section 5.16 hereof.
"'Specified Dispositions' shall have the meaning set forth in the
----------------------
definition of `Permitted Dispositions.'
"'Specified Equity Contributions' shall mean, with respect to any
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Investment, Restricted Payment or Acquisition, the sum of any cash amounts
invested (a) in Holdco and contributed to the Borrower or (b) in any Joint
Venture Subsidiary by any Person other than the Borrower or any of its
Subsidiaries, in either case in the form of an equity contribution or
issuance, for the sole purpose of financing such Investment, Restricted
Payment or Acquisition and to the extent not used for any other purpose."
(b) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the definition of "Available Revolving
Commitment" in its entirety and by substituting the following in lieu thereof:
"'Available Revolving Commitment' shall mean, on any calculation date,
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the excess of (a) (i) during the Amendment Period, (x) if the Borrower
shall have
______________
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
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maintained a Total Leverage Ratio less than or equal to * to 1.00 for each
month during the two (2) consecutive fiscal quarters immediately preceding
such date, the Revolving Commitment on such date, and (y) if the Borrower
shall not have maintained a Total Leverage Ratio less than or equal to
* to 1.00 for each month during the two (2) consecutive fiscal quarters
immediately preceding such date, $10,000,000, and (ii) after expiration of
the Amendment Period, the Revolving Commitment on such date, over (b) the
sum (without duplication) of (i) the aggregate principal amount of the
Revolving Loans then outstanding, (ii) the stated amount of Letters of
Credit then outstanding, and (iii) obligations under Letters of Credit
which the Borrower has not reimbursed."
(c) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Borrower Parties"
in its entirety and by substituting the following in lieu thereof:
"'Borrower Parties' shall mean, collectively, Holdco, Intermediate
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Holdco, any Permitted Intermediate Holdco Subsidiary, the Borrower, the
Guarantors and the Foreign Subsidiaries (other than, after the InternetCo
Release Date, any foreign members of the InternetCo Group)."
(d) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the reference to "sixty-five percent (65%)" in
the definition of "Borrower Pledge Agreement" and by substituting "sixty-six
percent (66%)" in lieu thereof.
(e) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by deleting clauses (i) and (l) from the definition of
"Change of Control" in their entirety and by substituting the following,
respectively, in lieu thereof:
"(i) other than in connection with any Specified Disposition or any
other disposition of 100% of the Equity Interests of any Subsidiary of the
Borrower permitted under Section 7.5 hereof, the failure of the Borrower to
own and control, directly or indirectly, free of any Lien or encumbrance,
other than Liens in favor of the Administrative Agent and Permitted Liens
of the type described in clauses (b) and (k) of the definition of
`Permitted Liens', (i) one hundred percent (100%) of the issued and
outstanding Equity Interests of each of its Subsidiaries (other than the
members of the InternetCo Group, the members of the LaunchCo Group, PubCo
and the *Joint Ventures), (ii) (x) during the Amendment Period and prior to
the InternetCo Release Date, at least eighty percent (80%) of the issued
and outstanding Equity Interests of each member of the InternetCo Group
(other than any Permitted InternetCo Joint Venture), provided that the
remaining Equity Interests of each member of the InternetCo Group (other
than any Permitted InternetCo Joint Venture) not owned, directly or
indirectly, by the Borrower are Management Shares, (y) after the Amendment
Period and prior to the InternetCo Release Date, directly or indirectly, at
least fifty and one-tenth percent (50.1%) of InternetCo, and (z) after the
InternetCo Release Date, directly or
______________
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
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indirectly, (I) at least forty percent (40%) and (II) together with
Management Shares, at least fifty percent (50%), of the issued and
outstanding Equity Interests of InternetCo, and (iii) at least ninety
percent (90%) of the issued and outstanding Equity Interests in
LaunchCo, provided that the remaining Equity Interests of LaunchCo not
owned by the Borrower are Management Shares; or"
"(l) other than in connection with any Specified Disposition or
any other disposition of 100% of the Equity Interests of any
Subsidiary of the Borrower permitted under Section 7.5 hereof, (i) the
failure of LaunchCo to own and control, free and clear of any Lien or
encumbrance, other than Liens in favor of the Administrative Agent and
Permitted Liens of the type described in clauses (b) and (k) of the
definition of `Permitted Liens', (x) at least ninety percent (90%) of
the issued and outstanding Equity Interests of Subsidiaries of
LaunchCo (except the Expedia Travels Joint Venture and, after
expiration of the Amendment Period, the LaunchCo Joint Ventures), or
(y) at least seventy-five percent (75%) of the issued and outstanding
Equity Interests of LaunchCo Joint Ventures, provided that, in each
case, if any of the Equity Interests not owned by LaunchCo are owned
by members of management of LaunchCo or members of management of
LaunchCo Joint Venture, such Equity Interests shall comply with the
requirements for Management Shares, or (ii) during the Amendment
Period, the failure by InternetCo to own and control, free and clear
of any Lien or encumbrance, other than Liens in favor of the
Administrative Agent and Permitted Liens of the type described in
clauses (b) and (k) of the definition of `Permitted Liens', directly
or indirectly, (I) at least forty percent (40%) and (II) together with
Management Shares, at least fifty percent (50%), of the issued and
outstanding Equity Interests of each Permitted InternetCo Joint
Venture."
(f) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Collateral" in its
entirety and by substituting the following in lieu thereof:
"'Collateral' shall mean all property pledged as collateral security
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for the Obligations pursuant to the Security Documents or otherwise, to the
extent set forth in the Security Documents, and all other property of
Holdco, Intermediate Holdco, the Borrower or any of its Subsidiaries that
is now or hereafter in the possession or control of any Credit Party in
which any Credit Party has been granted a Lien."
(g) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "EBITDA" in its
entirety and by substituting the following in lieu thereof:
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"'EBITDA' shall mean, for any period of determination, for the Borrower
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and its Restricted Subsidiaries on a consolidated basis, an amount equal to
the sum of (without duplication) (a) Net Income for such period, plus (b)
to the extent deducted in determining Net Income, the sum of each of the
following for such period: (i) Interest Expense, (ii) income, franchise and
withholding tax expense, (iii) depreciation and amortization, (iv)
extraordinary, unusual or non-recurring expenses, charges or losses (less
extraordinary, unusual or non-recurring gains), (v) any other non-cash
charges, (vi) non-recurring transaction expenses and fees (including,
without limitation, underwriters' fees), and (vii) the Specified Add-Backs;
provided, however, for purposes of determining the Senior Leverage Ratio
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and the Total Leverage Ratio (including, without limitation, under Section
2.3 and Section 2.4 hereof) and for purposes of determining compliance with
the limitations set forth in clause (e) of the definition of `Permitted
Dispositions', (A) with respect to any person that became a Restricted
Subsidiary of, or was merged with or consolidated into, the Borrower during
such period, or the Acquisition by the Borrower or any of its Restricted
Subsidiaries of a substantial part of the assets of any Person during such
period, `EBITDA' shall also include the EBITDA of such Person or
attributable to such assets, as applicable, during such period as if such
Acquisition, merger or consolidation had occurred on the first day of such
period, and (B) with respect to any Person that ceased to be a Restricted
Subsidiary of the Borrower during such period, or any material assets of
the Borrower or any of its Restricted Subsidiaries sold or otherwise
disposed of by the Borrower or any such Restricted Subsidiary during such
period, `EBITDA' shall exclude the EBITDA of such Person or attributable to
such assets, as applicable, during such period as if such sale or
disposition of such Restricted Subsidiary or such assets had occurred on
the first day of such period; provided further, however, that 'EBITDA'
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shall be calculated with respect to months or quarters, as applicable,
ending after April 1, 2001, without giving effect to the interests of the
Borrower or any Restricted Subsidiary in MacWorld or in any Joint Venture
Subsidiary except to the extent of the greater of (x) (A) the amount of
cash received by the Borrower or any of its Restricted Subsidiaries from
MacWorld or such Joint Venture Subsidiary, as applicable, during such
period, less (B) the aggregate amount of any Investments (other than
Investments funded by Specified Equity Contributions) in MacWorld or such
Joint Venture Subsidiary, as applicable, made by the Borrower or any of its
Restricted Subsidiaries during such period or (y) zero (0)."
(h) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by deleting clause (e) from the definition of "Fixed
Charges" and by substituting the following in lieu thereof:
"(e) Investments in or loans to LaunchCo and InternetCo (other than
any such Investments or loans funded by Specified Equity Contributions or
by the Net Proceeds of the Specified Dispositions);"
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(i) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by deleting clause (b) from the definition of "Funded Debt"
and by substituting the following in lieu thereof:
"(b) the principal amount of all Indebtedness for money borrowed of
another Person (other than, with respect to the Borrower, a Restricted
Subsidiary) Guaranteed by such Person;"
(j) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Guarantors" in
its entirety and by substituting the following in lieu thereof:
"'Guarantors' shall mean, collectively, each domestic Restricted
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Subsidiary of the Borrower, each domestic member of the LaunchCo Group and,
prior to the InternetCo Release Date, each domestic member of the
InternetCo Group, in each case that guaranties payment of the Obligations
hereunder and under the other Loan Documents."
(k) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by adding the following proviso at the end of the
definition of "Interest Expense":
"; provided, however, solely for purposes of calculating the amount of
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Fixed Charges and determining the amount of Interest Expense set forth in
clause (b) of the definition of `Interest Coverage Ratio', `Interest
Expense' shall exclude the amount of any Restricted Payment due on or after
July 16, 2001, with respect to the Permitted High-Yield Securities or the
Refinancing Securities, but only to the extent that such Restricted Payment
has been pre-funded with Specified Equity Contributions."
(l) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by adding "(other than the Expedia Travels Joint Venture)"
at the end of the definition of "LaunchCo Group".
(m) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "LaunchCo Joint
Ventures" in its entirety and by substituting the following in lieu thereof:
"'LaunchCo Joint Ventures' shall mean any directly-owned joint venture
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Subsidiary formed by LaunchCo (other than the Expedia Travels Joint
Venture) with respect to which a portion of the Equity Interests therein
are owned by one or more Persons other than the Borrower, any of the
Restricted Subsidiaries, any wholly-owned member of the LaunchCo Group, any
wholly-owned member of the InternetCo Group or any member of management."
(n) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by adding the following proviso at the end of the
definition of "MacWorld":
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"; provided, however, that notwithstanding anything to the contrary
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contained in this Agreement, in the event that PubCo shall sell or
otherwise dispose of the Equity Interest owned by it in MacWorld, all
references to 'MacWorld' in this Agreement shall no longer have any force
or effect"
(o) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by deleting the existing definition of "Management
Redemption Debt" in its entirety and by substituting the following in lieu
thereof:
"'Management Redemption Debt' shall mean any Indebtedness issued by
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Holdco or any of its Subsidiaries in favor of any officers, directors or
employees of the Borrower or any of its Subsidiaries in connection with the
purchase or redemption of Management Shares from such Person."
(p) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by deleting the existing definition of "Management Shares"
in its entirety and by substituting the following in lieu thereof:
"'Management Shares' shall mean the Equity Interests, if any, of PubCo,
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any member of the LaunchCo Group or any member of the InternetCo Group
issued by such Person to its employees; provided that such Equity Interests
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shall be issued pursuant to an agreement, in form and substance
satisfactory to the Agents (it being understood that any such agreement
shall include a grant by the recipients of such Equity Interests to the
other holders of the Equity Interests of such issuer and to the
Administrative Agent, on behalf of the Credit Parties, to require that in
the event of the sale of all or substantially all of the Equity Interests
of such issuer to a third party, such employee shall be required to sell
such Equity Interests to such third party)."
(q) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by deleting the existing definition of "Permitted
Dispositions" in its entirety and by substituting the following in lieu thereof:
"'Permitted Dispositions' shall mean the sale, lease, abandonment,
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transfer, trade or other disposition of, in a single transaction or in a
series of related transactions, any Assets, in each case at not less than
the fair market value thereof and subject to the following conditions: (a)
the Borrower shall provide to the Administrative Agent and the Lenders a
Performance Certificate setting forth the arithmetical calculations
required to establish the Borrower's pro forma compliance with Sections 8.1
and 8.2 of this Agreement; (b) with respect to any disposition having a
Purchase Price (with respect to a single transaction or a series of related
transactions) in excess of $10,000,000, the Borrower shall provide to the
Administrative Agent and the Lenders (i) revised Projections assuming
consummation of such disposition and demonstrating pro forma compliance
with the terms of this Agreement through, in the case of dispositions (x)
during the Amendment Period, the expiration of the Amendment Period, and
(y) after expiration of the Amendment Period, the Final Maturity Date, and
(ii) evidence satisfactory to the Agents and their
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counsel that the board of directors of the applicable Borrower Party shall
have certified in good faith as to the fair market value determination of
the Purchase Price with respect to such disposition; (c) at least
seventy-five percent (75%) of the Purchase Price with respect to such
disposition shall be in the form of cash; (d) the aggregate Purchase Price
for Assets (other than the International Publications) disposed of by the
Borrower and its Restricted Subsidiaries, (i) with respect to a single
transaction or a series of related transactions, shall not exceed
$20,000,000, and (ii) during the period from the Agreement Date through the
Final Maturity Date, shall not exceed $50,000,000, and (e) during the
Amendment Period, each of the Lenders shall have consented to such
disposition except to the extent that the assets subject to such
disposition, together with the assets subject to all other Permitted
Dispositions (other than the Specified Dispositions (as defined below))
consummated since the Fourth Amendment Date, shall not exceed fifteen
percent (15%) of EBITDA for the twelve (12) month period most recently
ended for which financial statements are required to have been provided
pursuant to Section 6.1 hereof; provided, however, that *(II) the
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disposition by PubCo of its Equity Interests in MacWorld, *(IV) the
disposition of the stream of royalty payments (other than the $3,000,000
payment due in August, 2001) owing to the Borrower in connection with the
sale of the International Publications for a cash Purchase Price of at
least $7,000,000 ((I), (II), (III) and (IV) being herein referred to
collectively as the 'Specified Dispositions'), (V) after expiration of the
----------------------
Amendment Period and prior to the InternetCo Release Date, the disposition
by the Borrower of up to 49.9% of the issued and outstanding Equity
Interests in InternetCo, (VI) subject to the restrictions on Change of
Control contained in this Agreement, the disposition by any member of the
InternetCo Group of the Equity Interests in any Permitted InternetCo Joint
Venture, and (VII) subject to the restrictions on Change of Control
contained in this Agreement, (A) during the Amendment Period and prior to
the InternetCo Release Date, the disposition of up to twenty percent (20%)
of the issued and outstanding Equity Interests of each member of the
InternetCo Group (other than the Permitted InternetCo Joint Ventures), (B)
after the InternetCo Release Date, (x) the disposition by the Borrower of
up to sixty percent (60%) of the issued and outstanding Equity Interests in
InternetCo and (y) the disposition of assets and liabilities of InternetCo,
and (C) after the earlier of the expiration of the Amendment Period and the
InternetCo Release Date, (x) the disposition by any member of the
InternetCo Group of the Equity Interests of any of its Subsidiaries (other
than any Permitted InternetCo Joint Ventures) and (y) the disposition of
assets and liabilities by any Subsidiaries of InternetCo."
(r) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by deleting clauses (i) and (s) from the definition of
"Permitted Liens" and by substituting the following, respectively, in lieu
thereof:
______________
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
8
"(i) after expiration of the Amendment Period, Liens granted to secure
Indebtedness of any member of the InternetCo Group or any member of the
LaunchCo Group permitted to be incurred under Section 7.1(h) and 7.1(i),
respectively;"
"(s) after expiration of the Amendment Period, Liens on the Equity
Interests of InternetCo's Subsidiaries to secure Indebtedness permitted
under Section 7.1(h) hereof;"
(s) Article 1 of the Credit Agreement, Definitions, is hereby
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modified and amended by deleting clause (a) from the definition of
"Restricted Payment" and by substituting the following in lieu thereof:
"(a) any direct or indirect distribution, dividend, redemption or other
payment to any Person on account of any Equity Interests, or other
securities of or equity interests, in Holdco, Intermediate Holdco, the
Borrower or any of the Borrower's Subsidiaries;"
(t) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Restricted
Purchase" and by substituting the following in lieu thereof:
"'Restricted Purchase' shall mean any payment on account of the
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purchase, redemption or other acquisition or retirement of any Equity
Interests, or other securities of or equity interests, in Holdco,
Intermediate Holdco, the Borrower or any of the Borrower's Subsidiaries,
including, without limitation, any warrants or other rights or options to
acquire Equity Interests of Holdco, Intermediate Holdco, the Borrower or
any of the Borrower's Subsidiaries."
(u) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Restricted
Subsidiaries" and by substituting the following in lieu thereof:
"'Restricted Subsidiaries' shall mean all Subsidiaries of the Borrower
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other than the Unrestricted Subsidiaries and *Joint Ventures, if any."
(v) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the reference to "$50,000,000" in the
definition of "Revolving Commitment" and by substituting "$30,000,000" in lieu
thereof.
(w) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Senior Leverage
Ratio" and by substituting the following in lieu thereof:
______________
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
9
"'Senior Leverage Ratio' shall mean, on any calculation date, the ratio
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of (a) Senior Debt, to (b) (i) on and after the Fourth Amendment Date
through December 31, 2002, EBITDA for the immediately preceding twelve (12)
month period, and (ii) thereafter, EBITDA for the immediately preceding
four (4) fiscal quarter period."
(x) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Subsidiary
Guaranty" and by substituting the following in lieu thereof:
"'Subsidiary Guaranty' shall mean that certain Amended and Restated
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Subsidiary Guaranty Agreement issued by each Subsidiary of the Borrower
(other than (a) any of the Foreign Subsidiaries, (b) after the InternetCo
Release Date, any members of the InternetCo Group and (c) with respect to
any of the Joint Venture Subsidiaries, only to the extent required
hereunder) in favor of the Administrative Agent, for the benefit of the
Credit Parties, dated as of the Fourth Amendment Date, in substantially the
form of Exhibit M attached hereto, and any similar guaranty or any guaranty
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supplement delivered pursuant to Section 5.15 hereof."
(y) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Subsidiary Pledge
Agreement" and by substituting the following in lieu thereof:
"'Subsidiary Pledge Agreement' shall mean that certain Amended and
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Restated Subsidiary Pledge Agreement between each Subsidiary of the
Borrower (other than (a) any of the Foreign Subsidiaries, (b) after the
InternetCo Release Date, any members of the InternetCo Group and (c) with
respect to any of the Joint Venture Subsidiaries, only to the extent
required hereunder) having one or more of its own Subsidiaries and the
Administrative Agent, for the benefit of the Credit Parties, dated as of
the Fourth Amendment Date, in substantially the form of Exhibit N attached
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hereto, and any similar pledge agreement or any pledge agreement supplement
delivered pursuant to Section 5.15 hereof."
(z) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Subsidiary Security
Agreement" and by substituting the following in lieu thereof:
"'Subsidiary Security Agreement' shall mean that certain Amended and
-----------------------------
Restated Subsidiary Security Agreement between each of the Borrower's
Subsidiaries (other than (a) any of the Foreign Subsidiaries, (b) after the
InternetCo Release Date, any members of the InternetCo Group and (c) with
respect to any of the Joint Venture Subsidiaries, only to the extent
required hereunder) and the Administrative Agent, for the benefit of the
Credit Parties, dated as of the Fourth Amendment Date, in substantially the
form of Exhibit O attached hereto, and any similar security agreement or
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any security agreement supplement delivered pursuant to Section 5.15
hereof."
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(aa) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the reference to "$100,000,000" in the
definition of "Term A Commitment" and by substituting "$46,938,571.70" in lieu
thereof.
(bb) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the reference to "$255,000,000" in the
definition of "Term B Commitment" and by substituting "$125,363,043.16" in lieu
thereof.
(cc) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "Total Leverage
Ratio" and by substituting the following in lieu thereof:
"'Total Leverage Ratio' shall mean, on any calculation date, the
--------------------
ratio of (a) Borrower Debt, to (b) (i) on and after the Fourth
Amendment Date through December 31, 2002, EBITDA for the immediately
preceding twelve (12) month period, and (ii) thereafter, EBITDA for
the immediately preceding four (4) fiscal quarter period."
(dd) Article 1 of the Credit Agreement, Definitions, is hereby
-----------
modified and amended by deleting the existing definition of "ZD Labs" in its
entirety and all references in the Credit Agreement to "ZD Labs" shall hereafter
be deemed to be references to "eTesting Labs".
2. Amendments to Section 2.1.
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(a) Section 2.1 of the Credit Agreement, The Loans, is hereby
---------
modified and amended by deleting the reference to "$405,000,000" in the
introductory paragraph and by substituting "$202,301,614.86" in lieu thereof.
(b) Section 2.1 of the Credit Agreement, The Loans, is hereby
---------
modified and amended by adding the following proviso to the end of the last
sentence of clause (a) thereof:
"; provided, however, with respect to each year during the Amendment
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Period, the Borrower shall not be permitted to borrow any additional
Advances under the Revolving Commitment for the fifteen (15) day
period from and including March 31st through April 14th"
3. Amendments to Section 2.3.
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(a) Section 2.3 of the Credit Agreement, Interest and
------------
Determination of Dollar Equivalent Amount, is hereby modified and amended by
adding the following proviso to the end of the first sentence of clause (a)
thereof:
"; provided, however, during the Amendment Period, interest on each
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Base Rate Advance shall be payable monthly in arrears, commencing on
July 31, 2001"
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(b) Section 2.3 of the Credit Agreement, Interest and Determination
--------------------------
of Dollar Equivalent Amount, is hereby modified and amended by adding the
----------------------------
following proviso to the end of the first sentence of clause (b) thereof:
"; provided, however, during the Amendment Period, interest on each
-------- -------
Eurodollar Advance shall be payable monthly in arrears, commencing on July
31, 2001"
(c) Section 2.3 of the Credit Agreement, Interest and Determination
--------------------------
of Dollar Equivalent Amount, is hereby modified and amended by adding the
----------------------------
following sentence at the end of clause (d) thereof:
"Notwithstanding anything to the contrary contained herein, during the
Amendment Period, immediately upon the occurrence of a Default with
respect to either Section 8.1 or Section 8.2 hereof and regardless of
whether such Default shall constitute an Event of Default under
Section 9.1(c) hereof, interest on the Obligations shall accrue at the
Default Rate from the date of such Default until the earliest to occur
of (I) the date of any of the events described in clauses (A) or (B)
of the immediately preceding sentence or (II) the date of compliance
with both Section 8.1 and Section 8.2 hereof."
(d) Section 2.3 of the Credit Agreement, Interest and Determination
---------------------------
of Dollar Equivalent Amount, is hereby modified and amended by adding the
---------------------------
following sentence at the end of clause (f)(i) thereof:
"Notwithstanding anything to the contrary contained in the foregoing,
during the Amendment Period, with respect to any Advance under the
Revolving Commitment, or any Advance of the Term A Loans, the
Applicable Margin shall be (A) 3.750% per annum with respect to any
Eurodollar Advance and (B) 2.500% per annum with respect to any Base
Rate Advance."
(e) Section 2.3 of the Credit Agreement, Interest and Determination
--------------------------
of Dollar Equivalent Amount, is hereby modified and amended by adding the
---------------------------
following sentence at the end of clause (f)(ii) thereof:
"Notwithstanding anything to the contrary contained in the foregoing,
during the Amendment Period, with respect to any Advance of the Term B
Loans, the Applicable Margin shall be (A) 4.250% per annum with
respect to any Eurodollar Advance and (B) 3.000% per annum with
respect to any Base Rate Advance."
4. Amendments to Section 2.7.
-------------------------
(a) Section 2.7 of the Credit Agreement, Mandatory Repayments, is
--------------------
hereby modified and amended by adding "After expiration of the Amendment
Period," at the beginning of each of clauses (i), (ii), (iii), (iv) and (v) of
clause (b) thereof.
12
(b) Section 2.7 of the Credit Agreement, Mandatory Repayments, is
--------------------
hereby further modified and amended by adding the following new clause (viii) at
the end of clause (b) thereof:
"(viii) Notwithstanding anything to the contrary contained in this
Section 2.7(b), during the Amendment Period, one hundred percent (100%) of
any Net Proceeds from the sale or other disposition of Assets (including,
without limitation, any Equity Interests in MacWorld or LaunchCo, but not
including (A) the issuance of Equity Interests in InternetCo or any of its
Subsidiaries, (B) the sale by the Borrower or any of its Subsidiaries of
Equity Interests in InternetCo or any of its Subsidiaries to the extent
that the Borrower shall have certified to the Agents that the Net Proceeds
received by the Borrower or any of its Subsidiaries in connection therewith
shall have simultaneously been re-invested in InternetCo or such Subsidiary
of InternetCo, as applicable, (C) the sale of obsolete equipment and
inventory, (D) the sale, transfer or other disposition of fixed Assets that
are replaced by property of substantially equivalent value in the ordinary
course of business, (E) the sale or lease of databases, software,
subscriber lists or office or laboratory space, or the licensing of
intellectual property, in each case in the ordinary course of business, (F)
the sale of Cash Equivalents, or (G) the sale or discount of accounts
receivable in connection with compromise or collection (but not in
connection with accounts receivable securitizations or similar
transactions)) received by the Borrower, InternetCo, LaunchCo or any of
their respective Subsidiaries, or distributed by MacWorld to the Borrower,
InternetCo, LaunchCo or any of their respective Subsidiaries, shall, in the
case of InternetCo, LaunchCo or any applicable Subsidiaries of the
Borrower, be promptly distributed on a pro rata basis to all of such
Person's equity holders and upon the Borrower receipt of its pro rata
share, shall be applied to permanently reduce the Loans pursuant to Section
2.7(e) hereof; provided, however, that to the extent InternetCo shall
-------- -------
distribute to the Borrower any Net Proceeds received by it in connection
with the issuance of Equity Interests in InternetCo or any of its
Subsidiaries, such Net Proceeds shall be applied to permanently reduce the
Loans pursuant to Section 2.7(e) hereof; provided, further however, that
-------- ------- -------
during the Amendment Period, Net Proceeds received in connection with the
Specified Dispositions in an aggregate amount not to exceed $50,000,000 may
be re-invested in the Borrower, InternetCo, LaunchCo or any of their
respective Subsidiaries (but not in MacWorld) to the extent permitted under
Section 7.2 hereof and in the manner set forth in clause (vi) above."
(c) Section 2.7 of the Credit Agreement, Mandatory Repayments, is
--------------------
hereby modified and amended by deleting clause (f) in its entirety and by
substituting the following in lieu thereof:
"(f) Revolving Loans. The Borrower shall make a prepayment of the
---------------
Revolving Loans (without any corresponding permanent reduction in the
Revolving Commitment) (i) in an amount equal to the excess, if any, of the
aggregate principal amount of the Revolving Loans over the Available
Revolving Commitment and (ii)
13
on each March 31st during the Amendment Period, in an amount
sufficient to reduce the aggregate outstanding principal amount of the
Revolving Loans to zero (0)."
5. Amendments to Section 5.15.
--------------------------
(a) Section 5.15 of the Credit Agreement, Covenants Regarding
-------------------
Formation of Subsidiaries, the Making of Acquisitions and Investments, is hereby
---------------------------------------------------------------------
modified and amended by deleting first two sentence thereof in their entirety
and substituting the following therefor:
"At the time of any Acquisition by any of the Borrower Parties, or the
formation of any new Subsidiary of any of the Borrower Parties, the
Borrower will, and will cause each of the other Borrower Parties, as
applicable and subject to Section 5.16 hereof, to (a) (other than in the
case of the Foreign Subsidiaries and the Joint Venture Subsidiaries)
provide to the Administrative Agent a duly executed supplement to the
Subsidiary Security Agreement for any new Subsidiary, together with
appropriate UCC_1 financing statements (provided that, with respect to the
LaunchCo Joint Ventures, the Borrower shall use commercially reasonable
efforts to obtain a supplement to the Subsidiary Security Agreement), (b)
(other than in the case of the Foreign Subsidiaries and the Joint Venture
Subsidiaries), provide to the Administrative Agent a duly executed
supplement to the Subsidiary Guaranty and a loan certificate for any such
new Subsidiary, substantially in the form of Exhibit T attached hereto,
together with appropriate attachments thereto (provided that, with respect
to the LaunchCo Joint Ventures, the Borrower shall use commercially
reasonable efforts to obtain a supplement to the Subsidiary Guaranty); (c)
(other than in the case of the Foreign Subsidiaries and the Joint Venture
Subsidiaries) pledge to the Administrative Agent all (or in the case of the
Foreign Subsidiaries, sixty-six percent (66%)) of the Equity Interests (or
other instruments or securities evidencing ownership) of any Subsidiary or
Person which is acquired or formed, beneficially owned by any of the
Borrower Parties (including, without limitation, the Equity Interests of
any Joint Venture Subsidiary), as additional Collateral for the Obligations
to be held by the Administrative Agent in accordance with the terms of the
Borrower Pledge Agreement or the Subsidiary Pledge Agreement, as
applicable, and execute and deliver to the Administrative Agent all such
documentation for such pledge (including, without limitation, a supplement
to the Subsidiary Pledge Agreement, original certificates representing the
pledged Equity Interests and corresponding certificate powers duly executed
in blank) as, in the reasonable opinion of the Administrative Agent, is
appropriate; and (d) provide all other documentation, including, without
limitation, an Intellectual Property Security Agreement or any other
security agreement covering any additional intellectual property obtained
by such Borrower Party (other than in the case of the Foreign Subsidiaries
and the Joint Venture Subsidiaries), additional UCC-1 financing statements,
and one or more opinions of counsel reasonably satisfactory to the
Administrative Agent which in the reasonable opinion of the Administrative
Agent is appropriate with respect to such Acquisition or the formation of
such new Subsidiary (provided that, in the case of the LaunchCo Joint
Ventures, the Borrower shall use commercially reasonable efforts to
14
obtain such other documentation). In addition, subject to Section 5.16
hereof, if the Borrower or any of the Subsidiaries of the Borrower (other
than the Foreign Subsidiaries and the Joint Venture Subsidiaries) shall at
any time obtain any interest in any registered patent, trademark or
copyright, or application for any of the foregoing, the Borrower or the
applicable Subsidiary shall, as soon as reasonably practicable thereafter,
execute and deliver to the Administrative Agent an Intellectual Property
Security Agreement (or amendment thereto), such UCC-1 financing statements
and one or more opinions of counsel reasonably satisfactory to the
Administrative Agent which in the reasonable opinion of the Administrative
Agent is appropriate for the pledge of such interests to the Administrative
Agent (provided that, in the case of the LaunchCo Joint Ventures, the
Borrower shall use commercially reasonable efforts to obtain an
Intellectual Property Security Agreement and such related documentation as
would otherwise be required hereunder)."
(b) Section 5.15 of the Credit Agreement, Covenants Regarding
-------------------
Formation of Subsidiaries, the Making of Acquisitions and Investments, is hereby
---------------------------------------------------------------------
further modified and amended by deleting the penultimate sentence thereof and by
substituting the following therefor:
"Investments made by any of the Borrower Parties (other than the
Foreign Subsidiaries and the Joint Venture Subsidiaries) after the
Agreement Date shall also be treated as additional Collateral and shall be
subject to the provisions of appropriate Security Documents (provided that,
in the case of the LaunchCo Joint Ventures, the Borrower shall use
commercially reasonable efforts to obtain a pledge of any Investment to the
extent otherwise required to be provided hereunder)."
6. Amendment to Article 5. Article 5 of the Credit Agreement,
----------------------
General Covenants, is hereby modified and amended by adding the following new
-----------------
Section 5.16 at the end thereof:
"Section 5.16 Release of Certain Collateral. Notwithstanding
-----------------------------
anything to the contrary contained in this Agreement or in any other Loan
Document, so long as no Default or Event of Default then exists or would be
caused thereby, (a) the Borrower may request that the Required Lenders
agree, in their sole discretion, to the release of any Guaranties issued by
and any Collateral pledged by any member of the InternetCo Group (but not
any Equity Interests owned by the Borrower or any of its Subsidiaries
(other than InternetCo or any of its Subsidiaries) in any member of the
InternetCo Group) (the effective date of such release of Guaranties and
Collateral being herein referred to as the "InternetCo Release Date");
provided, however, that so long as the aggregate amount of Investments by
-------- -------
the Borrower and its Subsidiaries (other than InternetCo and its
Subsidiaries) in the members of the InternetCo Group have been less than
$15,000,000 from and after the Fourth Amendment Date, the consent of the
Required Lenders shall not be required and the Administrative Agent may
release the Guaranties and the Collateral upon the Borrower's request, and
(b) InternetCo may form joint ventures (the "Permitted InternetCo Joint
--------------------------
Ventures") with respect to not more than five (5) web sites, provided that
--------
the aggregate amount of
15
Investments made by the Borrower and its Subsidiaries in any
individual web site subject to such joint venture arrangements shall
not be more than $500,000 or $2,500,000 in the aggregate for all such
joint venture web sites since the Fourth Amendment Date, and the
Administrative Agent may release the Guaranties and the Collateral
related to any Permitted InternetCo Joint Venture upon the Borrower's
request. In the event that the Borrower or any of its Subsidiaries
shall form any *Joint Venture and so long as no Default or Event of
Default then exists or would be caused thereby, the Collateral
relating to the applicable *Joint Venture (but not any Equity
Interests owned by the Borrower or any of its Subsidiaries therein)
shall be released by the Administrative Agent at the request of the
Borrower."
7. Amendment to Section 6.1. Section 6.1 of the Credit Agreement,
------------------------
Monthly Financial Statements and Information, is hereby deleted in its entirety
---------------------------------------------
and the following substituted in lieu thereof:
"Section 6.1 Monthly Financial Statements and Information. With
--------------------------------------------
respect to each month ending during the Amendment Period (including, without
limitation, September 30, 2002) and with respect to the month ending November
30, 2002, within thirty (30) days after the last day of each such month, the
unaudited income statement of the Borrower, on a consolidated basis with the
Restricted Subsidiaries, and the related revenue and EBITDA on a consolidating
(by publication) basis, for such month and for the elapsed portion of the year
ended with the last day of such month, which shall set forth in comparative form
such figures as at the end of and for such month and the corresponding month
during the preceding fiscal year and as against the figures set forth for such
month in the Borrower's business plan provided to the Credit Parties pursuant to
Section 6.5(c) hereof, and shall be certified by a Principal Officer to be, in
his or her opinion, complete and correct in all material respects and to present
fairly in all material respects, in accordance with GAAP, the financial position
of the Borrower, on a consolidated and consolidating (by publication) basis, as
at the end of such period and the results of operations for such period, and for
the elapsed portion of the year ended with the last day of such period, subject
only to normal year-end adjustments and the absence of footnotes, cash flow
statements and balance sheets."
8. Amendment to Section 6.4. Section 6.4 of the Credit Agreement,
------------------------
Performance Certificates, is hereby deleted in its entirety and the following
------------------------
substituted in lieu thereof:
"Section 6.4 Performance Certificates.
------------------------
"(a) At the time the financial statements are furnished pursuant
to Section 6.1 hereof, a Performance Certificate:
"(i) setting forth as at the end of such fiscal month, (A)
the arithmetical calculations required to establish whether the Borrower
was in
______________
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
16
compliance with the requirements of Section 8.1 and Section 8.2 hereof, and
(B) to the extent that the Borrower or any of the Restricted Subsidiaries
shall have made any payment during such fiscal month to cover operating
expenses incurred in the ordinary course of business which are allocable to
the operations of any Unrestricted Subsidiary, evidence that the Borrower
shall have received (whether during or prior to such fiscal month) (I) Net
Proceeds from any Specified Dispositions or (II) Specified Equity
Contributions, in either case in an amount sufficient to cover such
operating expenses and not used for other purposes;
"(ii) stating that, to the best of his or her knowledge, no
Default or Event of Default has occurred as at the end of such period, or,
if a Default or an Event of Default has occurred, disclosing each such
Default or Event of Default and its nature, when it occurred, whether it is
continuing and the steps being taken by the Borrower with respect to such
Default or Event of Default; and
"(iii) accompanied by a forecast of weekly cash receipts and
disbursements for the immediately succeeding fiscal month certified as
reasonable by a Principal Officer of the Borrower.
"(b) At the time the financial statements are furnished pursuant to
Section 6.2 hereof, a Performance Certificate:
"(i) setting forth as at the end of such fiscal quarter, the
arithmetical calculations required to establish (A) whether the Borrower
was in compliance with the requirements of the Financial Covenants, and (B)
after the expiration of the Amendment Period, the Applicable Margin; "
(ii) setting forth a summary of all Investments received by (x)
any member of the InternetCo Group (other than from any other member of the
InternetCo Group), (y) any member of the LaunchCo Group (other than from
any other member of the LaunchCo Group) and (z) any *Joint Venture, in each
case during the applicable fiscal quarter, which summary shall (A) include
the total amount of all such Investments received from and after the
Agreement Date, (B) identify the Person making such Investment, and (C)
with respect to Investments made by the Borrower or any of its
Subsidiaries, indicate whether each such Investment was funded with
Specified Equity Contributions or Net Proceeds received in connection with
a Specified Disposition; and
"(iii) stating that, to the best of his or her knowledge, no
Default or Event of Default has occurred as at the end of such period, or,
if a Default or an Event of Default has occurred, disclosing each such
Default or Event of Default and its nature, when it occurred, whether it is
continuing and the steps being taken by the Borrower with respect to such
Default or Event of Default."
______________
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
17
9. Amendment to Section 6.5. Section 6.5 of the Credit Agreement,
-------------------------
Other Reports, is hereby modified and amended by adding the following new'
-------------
subsection (j) at the end thereof:
"(j) Promptly, and in no event later than five (5) Business Days,
following the consummation thereof, written notice to the Arrangers of
(i) any capital contribution made to the Borrower and (ii) any use of
Net Proceeds received in connection with any Specified Dispositions
permitted to be reinvested under Section 2.7 hereof."
10. Amendments to Section 7.1.
-------------------------
(a) Section 7.1 of the Credit Agreement, Indebtedness, is hereby
------------
modified and amended by deleting subsection (f) and substituting the following
in lieu thereof:
"(f) (i) during the Amendment Period, Indebtedness that
constitutes an Investment permitted under Section 7.2 hereof (provided
that, to the extent any such Funded Debt shall be evidenced by a promissory
note in favor of any Guarantor, such note shall be collaterally assigned to
the Administrative Agent and, if such Funded Debt is secured, each security
agreement or other collateral document relating thereto shall also be
collaterally assigned to the Administrative Agent), and (ii) after the
Amendment Period, Indebtedness that constitutes an Investment permitted
under Section 7.2(a), (d) or (m) hereof;
(b) Section 7.1 of the Credit Agreement, Indebtedness, is hereby
further modified and amended by deleting subsection (q) and substituting the
following in lieu thereof:
"(q) (i) prior to the InternetCo Release Date, Indebtedness of
any member of the InternetCo Group to any other member of the InternetCo
Group (other than the Permitted InternetCo Joint Ventures) and Indebtedness
of any Permitted InternetCo Joint Venture to any other Permitted InternetCo
Joint Venture and (ii) after the InternetCo Release Date, Indebtedness of
any member of the InternetCo Group to any other member of the InternetCo
Group;"
(c) Section 7.1 of the Credit Agreement, Indebtedness, is hereby
------------
further modified and amended by deleting subsection (s) and substituting the
following in lieu thereof:
"(s) (i) after the expiration of the Amendment Period or (ii)
with the consent of the Required Lenders, non-Recourse Indebtedness
incurred by the Borrower and its Restricted Subsidiaries in an aggregate
amount not to exceed $5,000,000 at any one time outstanding;"
(d) Section 7.1 of the Credit Agreement, Indebtedness, is hereby
------------
modified and amended by deleting subsection (u) and substituting the following
in lieu thereof:
18
"(u) (i) after the expiration of the Amendment Period or (ii)
with the consent of the Required Lenders, other Indebtedness not
expressly permitted above in an aggregate principal amount not to
exceed $5,000,000 at any one time outstanding."
(e) Section 7.1 of the Credit Agreement, Indebtedness, is hereby
------------
modified and amended by adding the following at the end of thereof:
"Notwithstanding anything to the contrary contained herein, during the
Amendment Period, each of the Foreign Subsidiaries, each member of the
InternetCo Group and each member of the LaunchCo Group shall not incur
any Funded Debt without the consent of the Required Lenders (other
than (i) any intercompany Indebtedness within each such specified
group to the extent otherwise permitted in this Section 7.1 and (ii)
Indebtedness permitted under clause (f) of this Section 7.1 (provided
that, in each case, to the extent any such Funded Debt shall be
evidenced by a promissory note in favor of any Guarantor, such note
shall be collaterally assigned to the Administrative Agent and, if
such Funded Debt is secured, each security agreement, each security
agreement or other collateral document relating thereto shall also be
collaterally assigned to the Administrative Agent)); provided,
--------
however, that following the earlier of (A) the expiration of the
-------
Amendment Period and (B) the InternetCo Release Date, members of the
InternetCo Group may incur Indebtedness to the extent otherwise
permitted under this Section 7.1 without the consent of the Required
Lenders."
11. Amendments to Section 7.2.
-------------------------
(a) Section 7.2 of the Credit Agreement, Investments, is hereby
-----------
modified and amended by deleting the parenthetical "(other than InternetCo)" and
substituting "(other than, after the InternetCo Release Date, InternetCo and its
Subsidiaries)" in lieu thereof.
(b) Section 7.2 of the Credit Agreement, Investments, is hereby
-----------
further modified and amended by deleting clause (e) and by substituting the
following in lieu thereof.
"(e) so long as the Administrative Agent and the other Credit
Parties, or any of them, have not accelerated the payments due in respect
of the Loans under Section 9.2 hereof following an Event of Default, make
Investments in the Restricted Subsidiaries, the Unrestricted Subsidiaries,
the Joint Venture Subsidiaries (other than, except to the extent permitted
pursuant to clause (x) of the last paragraph of this Section 7.2, the
*Joint Ventures) and MacWorld with Specified Equity Contributions;"
(c) Section 7.2 of the Credit Agreement, Investments, is hereby
-----------
further modified and amended by deleting subsection (r) and substituting the
following in lieu thereof:
"(r) (i) after the expiration of the Amendment Period or (ii)
with the consent of the Required Lenders, make other Investments, and issue
Guarantees, not expressly permitted above in an aggregate amount not to
exceed $1,000,000 at any
------------------
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
19
time outstanding; provided, however, that Investments in, and Guarantees
for the benefit of, any Permitted InternetCo Joint Venture and, after the
InternetCo Release Date, any other member of the InternetCo Group shall not
be permitted pursuant to this clause (r)."
(d) Section 7.2 of the Credit Agreement, Investments, is hereby
-----------
further modified and amended by adding the following proviso at the end of
thereof:
"Notwithstanding anything to the contrary contained in this Agreement, the
following shall apply:
"(v) during the Amendment Period, all Investments or loans made by the
Restricted Group in or to any member of the InternetCo Group, any member of
the LaunchCo Group, MacWorld or any Foreign Subsidiary shall be subject to
consent of the Required Lenders; provided, however, that so long as the
-------- -------
Administrative Agent and the other Credit Parties, or any of them, have not
accelerated the payments due in respect of the Loans under Section 9.2
hereof following an Event of Default,
"(I) the Borrower and its Restricted Subsidiaries may make
Investments in the Unrestricted Subsidiaries and in the Joint Venture
Subsidiaries (other than, except to the extent permitted pursuant to
clause (x) below, the *Joint Ventures) with Specified Equity
Contributions;
"(II) the Borrower and its Subsidiaries may make Investments
funded by the Net Proceeds received from asset sales to the extent
such proceeds are not required to repay the Loans pursuant to Section
2.7 hereof and have not been used for any other purpose; and
"(III) the Borrower may make Investments in any Unrestricted
Subsidiary to cover operating expenses incurred in the ordinary course
of business which are allocable to the operations of such Unrestricted
Subsidiary to the extent that the Borrower shall have received (A) Net
Proceeds from any Specified Dispositions or (B) Specified Equity
Contributions, in either case in an amount sufficient to cover such
operating expenses and not used for other purposes;
"(w) except for Investments made with Specified Equity Contributions
to the extent permitted under Section 7.2(e) hereof, (A) Investments in the
Joint Venture Subsidiaries (other than the *Joint Ventures), and (B)
following the InternetCo Release Date, Investments by the Borrower or any
of its Subsidiaries (other than InternetCo and its Subsidiaries) in members
of the InternetCo Group, shall, in each case, require the consent of the
Required Lenders;
______________
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
20
"(x) following the sale of all or any material portion of the
assets and liabilities of any of the *Publications or any of the
Equity Interests in any *Joint Ventures, Investments by the Borrower
or any of its Subsidiaries in such *Publications and in such *Joint
Ventures shall require the consent of the Required Lenders; provided,
--------
however, that such Investments made with Specified Equity
-------
Contributions in an amount not to exceed $5,000,000 in the aggregate
during the term of this Agreement shall be permitted without the
consent of the Required Lenders;
"(y) InternetCo and its Subsidiaries shall be permitted to make
Investments without restriction to the extent such Investments shall
be funded by Specified Equity Contributions; and
"(z) during the Amendment Period, the Unrestricted Subsidiaries
shall be permitted to make Investments in MacWorld (whether directly
or through a member of the Restricted Group) only with the consent of
the Required Lenders."
12. Amendments to Section 7.5.
-------------------------
(a) Section 7.5 of the Credit Agreement, Liquidation; Merger;
-------------------
Acquisition or Disposition of Assets, is hereby modified and amended by deleting
------------------------------------
the reference to "Restricted Subsidiaries" in subsections (iii) and (xiii)
thereof and substituting "Subsidiaries" therefor.
(b) Section 7.5 of the Credit Agreement, Liquidation; Merger;
--------------------
Acquisition or Disposition of Assets, is hereby modified and amended by deleting
------------------------------------
the introductory paragraph to subsection (v) thereof and substituting the
following therefor:
"(v) subject to compliance with Section 5.15, the Borrower and
its Restricted Subsidiaries may form Subsidiaries, and (A) after
expiration of the Amendment Period or (B) with the consent of the
Required Lenders, may make Acquisitions and Investments of Assets or
businesses, within their respective lines of business, subject to the
following conditions:"
(c) Section 7.5 of the Credit Agreement, Liquidation; Merger;
-------------------
Acquisition or Disposition of Assets, is hereby modified and amended by deleting
------------------------------------
subsection (vi) thereof and substituting the following therefor:
"(vi) subject to compliance with Sections 2.7 and 5.15,
"(A) during the Amendment Period, (I) the Unrestricted
Subsidiaries make Investments as permitted under Section 7.2 hereof,
(II) members of the InternetCo Group may transfer Assets to other
members of the InternetCo Group (other than Permitted InternetCo Joint
Ventures), members of the Restricted Group or members of the LaunchCo
Group (other than LaunchCo Joint Ventures), (III) members of the
LaunchCo Group may transfer Assets to other members of the LaunchCo
Group
______________
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
21
(other than LaunchCo Joint Ventures) or members of the Restricted
Group, (IV) members of the InternetCo Group may enter into any merger,
consolidation or other business combination with other members of the
InternetCo Group (other than Permitted InternetCo Joint Ventures), (V)
members of the LaunchCo Group may enter into any merger, consolidation
or other business combination with other members of the LaunchCo Group
(other than LaunchCo Joint Ventures), (VI) the Unrestricted
Subsidiaries (other than LaunchCo Joint Ventures) may create or
acquire any Subsidiary, (VII) subject to Section 8.5 hereof, the
Unrestricted Subsidiaries may make Capital Expenditures in the
ordinary course of their respective businesses, and (VIII) InternetCo
and its Subsidiaries may acquire Equity Interests or assets, or make
any Acquisition, to the extent funded by Specified Equity
Contributions;
"(B) after the Amendment Period, the Unrestricted Subsidiaries
may (I) enter into any merger, consolidation or other business
combination, (II) acquire Equity Interests or assets, or make any
Acquisition, or (III) create or acquire any Subsidiary or sell, lease,
abandon, transfer, trade or otherwise dispose of any of its Assets,
property or business; provided, however, that no LaunchCo Joint
Venture may form a Subsidiary; and"
(d) Section 7.5 of the Credit Agreement, Liquidation; Merger;
--------------------
Acquisition or Disposition of Assets, is hereby modified and amended by adding
------------------------------------
"after expiration of the Amendment Period," at the beginning of each of
subsections (ix), (x) and (xi) thereof.
(e) Section 7.5 of the Credit Agreement, Liquidation; Merger;
--------------------
Acquisition or Disposition of Assets, is hereby modified and amended by adding
------------------------------------
the following proviso to subsection (viii) thereof and substituting the
following therefor:
"provided, however, that during the Amendment Period, LaunchCo
-------- -------
shall be permitted to form the Expedia Travels Joint Venture;"
(f) Section 7.5 of the Credit Agreement, Liquidation; Merger;
--------------------
Acquisition or Disposition of Assets, is hereby modified and amended by deleting
------------------------------------
subsection (xii) and substituting "(xii) [Intentionally Omitted]" therefor.
(g) Section 7.5 of the Credit Agreement, Liquidation; Merger;
--------------------
Acquisition or Disposition of Assets, is hereby modified and amended by deleting
------------------------------------
subsection (xiv) and substituting the following therefor:
"(xiv) the Borrower and its Subsidiaries may sell (A) up to ten
percent (10%) of the Equity Interests owned by the Borrower in
LaunchCo to management as Management Shares, (B) during the Amendment
Period and prior to the InternetCo Release Date, up to twenty percent
(20%) of the issued and outstanding Equity Interests in InternetCo and
its Subsidiaries (other than any Permitted InternetCo Joint Venture)
to management as Management Shares, (C) after the Amendment Period
22
and prior to the InternetCo Release Date, up to 49.9% of the issued
and outstanding Equity Interests in InternetCo, (D) after the
InternetCo Release Date and subject to the restrictions on Change of
Control contained in this Agreement, up to sixty percent (60%) of the
issued and outstanding Equity Interests in InternetCo, and (E) any of
the Equity Interests of any of the *Joint Ventures;"
(h) Section 7.5 of the Credit Agreement, Liquidation; Merger;
--------------------
Acquisition or Disposition of Assets, is hereby modified and amended by adding
------------------------------------
"(A) after expiration of the Amendment Period or (B) during the Amendment Period
with the consent of the Required Lenders and" at the beginning of subsection
(xv) thereof.
(i) Section 7.5 of the Credit Agreement, Liquidation; Merger;
--------------------
Acquisition or Disposition of Assets, is hereby modified and amended by (i)
------------------------------------
adding "(A) after expiration of the Amendment Period or (B) during the Amendment
Period with the consent of the Required Lenders and" at the beginning of
subsection (xvii) thereof and (B) adding the following proviso at the end of
subsection (xvii) thereof:
"provided, however, that notwithstanding the foregoing, during
-------- -------
the Amendment Period, in the event MacWorld or any member of the
InternetCo Group transfers assets to the Borrower or any of its
Subsidiaries, such Person receiving such assets may further transfer
such assets in a substantially contemporaneous transaction to the
Borrower or any other Subsidiary of the Borrower;"
(j) Section 7.5 of the Credit Agreement, Liquidation; Merger;
--------------------
Acquisition or Disposition of Assets, is hereby modified and amended by deleting
------------------------------------
the word "and" at the end of subsection (xvii), by replacing the period at the
end of subsection (xviii) with "; and" and by adding the following new
subsection at the end thereof:
"(xix) subject to compliance with Section 2.7 and Section 5.15
hereof, (A) InternetCo and its Subsidiaries may form any Permitted
InternetCo Joint Venture and may sell up to fifty percent (50%) of the
Equity Interest owned by it therein, and (B) the Borrower and its
Subsidiaries may form any *Joint Venture and may sell any of the
Equity Interests owned by it therein."
13. Amendment to Section 7.7. Section 7.7 of the Credit Agreement,
-------------------------
Restricted Payments and Purchases, is hereby deleted in its entirety and the
---------------------------------
following substituted therefor:
"Section 7.7 Restricted Payments and Purchases. The Borrower
---------------------------------
shall not, and shall cause each of its Subsidiaries not to, directly
or indirectly, declare or make any Restricted Payment or Restricted
Purchase except that (a) the Borrower may make regularly scheduled
payments of interest when due on the Permitted High-Yield Securities
or the Refinancing Securities, (b) the Borrower may make Restricted
Payments to Holdco to permit Holdco to pay taxes, salaries, directors
fees, indemnities and expenses and other corporate expenses in the
ordinary course of its
------------------
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
23
business, (c) the Subsidiaries of the Borrower may make distributions
to the holders of their respective Equity Interests, (d) the Borrower
and its Subsidiaries may declare and pay dividends solely in common
stock or Preferred Stock (other than Disqualified Capital Stock), and
(e) so long as no Default or Event of Default then exists or would be
caused thereby, the Borrower and its Subsidiaries may (i) make
Restricted Payments to Holdco, Intermediate Holdco or any Permitted
Intermediate Holdco Subsidiary to enable such Person to make, and such
Person may make, regularly scheduled payments of interest when due on
any Permitted High-Yield Securities (or the Refinancing Securities, as
applicable), after expiration of a five (5) year period following the
issuance of such securities (during which time such securities may
accrue interest in kind), (ii) in connection with any refinancing of
Permitted High-Yield Securities with Refinancing Securities, make
Restricted Payments to the holders of the Permitted High-Yield
Securities in an aggregate amount not to exceed the amount of then
outstanding principal and accrued interest of the Permitted High-Yield
Securities, plus related premiums, fees and expenses with respect to
the refinancing of the Permitted High-Yield with such Refinancing
Securities, (iii) make Restricted Payments or Restricted Purchases in
connection with the repurchase, redemption or other acquisition or
retirement for value of any Equity Interests of Holdco or any of its
Subsidiaries held by any employee, former employee, spouse, former
spouse of any employee or former employee and any of their respective
estates, or make payments on notes evidencing any Management
Redemption Debt, in an aggregate amount not to exceed the sum of (A)
$1,000,000 during any fiscal year (with unused amounts in any fiscal
year being carried over to succeeding fiscal years), plus (B) the
Borrower's fifty percent (50%) share of the aggregate cash Net
Proceeds received from any `key-man' life insurance policies, (iv)
repurchase Equity Interests by the issuance of Management Redemption
Debt permitted under Section 7.1 hereof, (v) repurchase Equity
Interests or make payments with respect to Management Redemption Debt
with Specified Equity Contributions expressly made for such purpose,
and (vi) repurchase Equity Interests in consideration for the
cancellation of any Management Notes issued in connection with the
original purchase thereof. Notwithstanding anything to the contrary
contained in this Agreement or the other Loan Documents, the
Borrower's share of all Restricted Payments made by the direct
Unrestricted Subsidiaries shall be paid to the Borrower."
14. Amendment to Section 7.8. Section 7.8 of the Credit Agreement,
------------------------
Affiliate Transactions, is hereby modified and amended by deleting clause (a)
----------------------
thereof and by substituting "(a) Investments and loans (other than loans made by
any of the Unrestricted Subsidiaries to any member of the Restricted Group)
permitted under Section 7.1 and Section 7.2 (other than loans made by any of the
Unrestricted Subsidiaries to any member of the Restricted Group)" therefor.
15. Amendment to Article 8.
----------------------
24
(a) Section 8.1 of the Credit Agreement, Total Leverage Ratio, is
--------------------
hereby deleted in its entirety and the following substituted in lieu thereof:
"Section 8.1 Total Leverage Ratio. (a) The Borrower shall not
--------------------
permit for any calendar month end (other than October 31, 2002) during
the periods set forth below, or as of the date of any Advance
(including, without limitation, October 31, 2002) during such periods,
the Total Leverage Ratio, after giving effect to such Advance (if
applicable), to exceed the applicable ratio for such date during the
periods as set forth below:
Applicable Period Ratio
----------------- -----
June 30, 2001 *to 1.00
July 1, 2001 through August 31, 2001 *to 1.00
September 1, 2001 through September 30, 2001 *to 1.00
October 1, 2001 through October 31, 2001 *to 1.00
November 1, 2001 through November 30, 2001 *to 1.00
December 1, 2001 through December 31, 2001 *to 1.00
January 1, 2002 through January 31, 2002 *to 1.00
February 1, 2002 through February 28, 2002 *to 1.00
March 1, 2002 through March 31, 2002 *to 1.00
April 1, 2002 through April 30, 2002 *to 1.00
May 1, 2002 through May 31, 2002 *to 1.00
June 1, 2002 through June 30, 2002 *to 1.00
July 1, 2002 through September 30, 2002 *to 1.00
October 1, 2002 through December 31, 2002 *to 1.00
"(b) The Borrower shall not permit for each fiscal quarter end
during the periods set forth below, or as of the date of any Advance
during such periods, the Total Leverage Ratio, after giving effect to
such Advance (if applicable), to exceed the applicable ratio for such
date during the periods as set forth below:
Applicable Period Ratio
----------------- -----
January 1, 2003 through December 31, 2003 *to 1.00
January 1, 2004 and thereafter *to 1.00"
(b) Section 8.2 of the Credit Agreement, Senior Leverage Ratio,
---------------------
is hereby deleted in its entirety and the following substituted in lieu thereof:
"Section 8.2 Senior Leverage Ratio. (a) The Borrower shall not
---------------------
permit for any calendar month end (other than October 31, 2002) during
the periods set forth below, or as of the date of any Advance
(including, without limitation, October 31, 2002), the Senior Leverage
Ratio, after giving effect to such Advance (if applicable), to exceed
the applicable ratio for such date during the periods as set forth
below:
------------------
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
25
Applicable Period Ratio
----------------- -----
June 30, 2001 through December 31, 2001 *to 1.00
January 1, 2002 through March 31, 2002 *to 1.00
April 1, 2002 through September 30, 2002 *to 1.00
October 1, 2002 through December 31, 2002 *to 1.00
"(b) The Borrower shall not permit for each fiscal quarter end
during the periods set forth below, or as of the date of any Advance
during such periods, the Senior Leverage Ratio, after giving effect to
such Advance (if applicable), to exceed the applicable ratio for such
date during the periods as set forth below:
Applicable Period Ratio
----------------- -----
January 1, 2003 through December 31, 2003 *to 1.00
January 1, 2004 and thereafter *to 1.00"
(c) Section 8.3 of the Credit Agreement, Interest Coverage Ratio,
-----------------------
is hereby deleted in its entirety and the following substituted in lieu thereof:
"Section 8.3 Interest Coverage Ratio. For each fiscal quarter end
-----------------------
set forth below, the Borrower shall not permit the Interest Coverage
Ratio to be less than the ratio specified below with respect to such
fiscal quarter end:
Quarters Ending Ratio
--------------- -----
June 30, 2001 and September 30, 2001 *to 1.00
December 31, 2001 *to 1.00
March 31, 2002 *to 1.00
June 30, 2002 *to 1.00
September 30, 2002 *to 1.00
December 31, 2002 *to 1.00
January 1, 2003 through December 31, 2003 *to 1.00
January 1, 2004 and thereafter *to 1.00"
(d) Section 8.4 of the Credit Agreement, Fixed Charge Coverage
---------------------
Leverage Ratio, is hereby deleted in its entirety and the following substituted
--------------
in lieu thereof:
"Section 8.4 Fixed Charge Coverage Ratio. For each fiscal quarter
---------------------------
end specified below, the Borrower shall not permit the Fixed Charge
Coverage Ratio to be less than the ratio specified below with respect
to such fiscal quarter end:
Quarters Ending Ratio
--------------- -----
June 30, 2001 *to 1.00
September 30, 2001 Not Tested
------------------
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
26
December 31, 2001 Not Tested
March 31, 2002 *to 1.00
June 30, 2002 *to 1.00
September 30, 2002 *to 1.00
December 31, 2002 and thereafter *to 1.00
(e) Section 8.5 of the Credit Agreement, Capital Expenditures, is
--------------------
hereby deleted in its entirety and the following substituted in lieu thereof:
"Section 8.5 Capital Expenditures. The Borrower and its
--------------------
Restricted Subsidiaries shall not make Capital Expenditures (other
than in connection with the reinvestment of asset sale Net Proceeds to
the extent set forth in Section 2.7(b)(viii) and Section 7.5 hereof)
(a) during the period from April 1, 2001 through March 31, 2002, in
excess of $12,000,000, and (b) during the period from April 1, 2002
through September 30, 2002, in excess of the sum of (i) $6,000,000,
plus (ii) up to $1,000,000 to be carried over from the prior period to
the extent not used during such prior period."
(f) Article 8 of the Credit Agreement, Financial Covenants, is
-------------------
hereby modified and amended by adding the following new Section 8.6 at the end
thereof:
"Section 8.6 Minimum Cash On-Hand. The Borrower shall be required
--------------------
to maintain cash on-hand of at least $15,000,000 during the period
from the Fourth Amendment Date until July 16, 2001, for the purpose of
making the payment of interest due on July 16, 2001, with respect to
the Permitted High Yield Securities."
16. Amendment to Section 9.1. Section 9.1 of the Credit Agreement,
------------------------
Events of Default, is hereby modified and amended by deleting clause (c) thereof
-----------------
and substituting the following therefor:
"(c) The Borrower shall default in the performance or observance
of any agreement or covenant contained in Section 5.1(a), 5.5, 5.7 or
5.8 or in Article 6 or Article 7 or Article 8 of this Agreement or in
any Security Documents; provided, however, that in the case of Article
-------- -------
6, the Administrative Agent shall have given the Borrower written
notice of such Default; provided further, however, that in the case of
-------- ------- -------
Section 8.1 and 8.2 with respect to compliance with such covenants for
any fiscal month (other than November and May) during the Amendment
Period, such Event of Default shall only be deemed to have occurred if
(i) the Borrower shall have failed to demonstrate compliance with such
Financial Covenants for two (2) consecutive calendar months, or (ii)
the Total Leverage Ratio shall exceed the applicable ratio set forth
in Section 8.1 with respect to such calendar month by greater than
0.50 to 1.00, or (iii) the Senior Leverage Ratio shall exceed the
applicable ratio set forth in Section 8.2 with respect to such
calendar month by greater than 0.50 to 1.00;"
17. Amendments to Exhibits.
----------------------
(a) Exhibit M to the Credit Agreement, Form of Subsidiary
------------------
Guaranty, is hereby deleted in its entirety and Exhibit M attached hereto is
substituted in lieu thereof.
------------------
*Certain terms have been omitted pursuant to a request for confidential
treatment, and the omitted portions have been filed separately with the
Securities and Exchange Commission.
27
(b) Exhibit N to the Credit Agreement, Form of Subsidiary Pledge
-------------------------
Agreement, is hereby deleted in its entirety and Exhibit N attached hereto is
---------
substituted in lieu thereof.
(c) Exhibit O to the Credit Agreement, Form of Subsidiary
------------------
Security Agreement, is hereby deleted in its entirety and Exhibit O attached
------------------
hereto is substituted in lieu thereof.
18. Amendment to Schedules to the Credit Agreement. Schedule 2 to the
----------------------------------------------
Credit Agreement, Allocation of Commitments among Lenders and Lenders' Addresses
--------------------------------------------------------------
for Notice, is hereby modified and amended by deleting the existing schedule in
----------
its entirety and by substituting Schedule 2 attached hereto in lieu thereof.
19. Waiver. The Lead Arranger, the Syndication Agent, the
------
Documentation Agent, the Administrative Agent and the Credit Parties hereby
waive (a) (i) the Defaults and Events of Default existing as of June 30, 2001,
under the Financial Covenants set forth in Sections 8.1 through 8.4 of the
Credit Agreement, (ii) the Default existing under Section 6.5(c) of the Credit
Agreement resulting from the Borrower's failure to deliver a copy of the
Borrower's annual business plan and updated financial projections for itself and
the Restricted Subsidiaries by April 30, 2001, and (iii) the Default existing
under Section 6.3 of the Credit Agreement resulting from the Borrower's failure
to deliver audited financials, together with related opinions and certificates,
with respect to the fiscal year ending March 31, 2001, within 105 days of the
end of such fiscal year (the "Financial Statement Default") (the foregoing
clauses (i), (ii) and (iii) being hereinafter collectively referred to as the
"Existing Defaults") and (b) their rights and remedies under the Credit
Agreement and the other Loan Documents which may arise as a result of any
Existing Default. Notwithstanding anything to the contrary contained in the
foregoing, the waiver of the Financial Statement Default hereunder shall be
limited in time and shall thereupon only be effective through July 23, 2001. In
the event that the Borrower shall have failed to deliver the financial
statements required by Section 6.3 of the Credit Agreement on or before July 23,
2001, an Event of Default shall be deemed to have occurred under the Credit
Agreement. The waivers contained in the foregoing sentence shall not waive any
other requirement or hinder, restrict or otherwise modify the rights and
remedies of the Lead Arranger, the Syndication Agent, the Documentation Agent,
the Administrative Agent and the Credit Parties following the occurrence of any
other present or future Default or Event of Default (whether or not related to
any Default or Event of Default described in this Section 19) under the Credit
Agreement or any other Loan Document.
20. No Other Amendments or Waivers. Except for the amendments and
------------------------------
waivers set forth above, the text of the Credit Agreement and the other Loan
Documents shall remain unchanged and in full force and effect, and the Lead
Arranger, the Syndication Agent, the Documentation Agent, the Administrative
Agent and the Credit Parties hereby reserve the right to require strict
compliance with the terms of the Credit Agreement and the other Loan Documents
in the future.
21. Reaffirmation. Each of the Borrower and the Guarantors (each a
-------------
"Pledge Party") acknowledges and agrees that the security and other interests
granted to the Administrative Agent and the other Credit Parties pursuant to the
Loan Documents to which each respective Pledge Party is a signatory prior to the
date hereof shall remain outstanding and in full force and effect in accordance
with the Loan Documents, and shall continue to secure the Obligations, and that
the security and other interests granted to the Administrative Agent and the
other Credit Parties thereby are hereby ratified, confirmed and continued by
execution and delivery hereof. The Loan Documents shall remain extant and in
full force and effect following
28
the execution and delivery of this Amendment and the other Loan Documents
executed in connection therewith, and each of the Pledge Parties hereby ratifies
and confirms its respective obligations thereunder.
22. Amendment Fee. The Borrower hereby agrees to pay, upon the
-------------
Effective Date (as defined in Section 23 below), to each Lender delivering its
consent to this Amendment on or before July 10, 2001, an amendment fee in the
amount of 25 basis points on the amount of such Lender's Revolving Commitment
and Term Loans after giving effect to this Amendment and any repayment of the
Loans made in connection herewith. The amendment fee referred to herein shall be
fully earned when due and non-refundable when paid.
23. Conditions to Effectiveness. This Agreement shall be effective as
---------------------------
of the date first written above (the "Effective Date") upon (a) the
Administrative Agent's receipt of a counterpart hereof duly executed by the
Borrower, the Guarantors and the Required Lenders and (b) upon the occurrence of
each of the following terms and conditions:
(a) The Administrative Agent shall have received each of the
following in form and substance satisfactory to the Administrative Agent and its
counsel:
(i) the duly executed Subsidiary Guaranty executed and
delivered by each Subsidiary of the Borrower (other than any of the
Foreign Subsidiaries and the LaunchCo Joint Ventures existing as of
the Fourth Amendment Date);
(ii) the duly executed Subsidiary Pledge Agreement from
each Subsidiary of the Borrower (other than any of the Foreign
Subsidiaries and the LaunchCo Joint Ventures existing as of the Fourth
Amendment Date) which has one or more Subsidiaries, together with
appropriate original certificates representing the Equity Interests
pledged thereunder and corresponding undated certificate powers with
respect thereto executed in blank;
(iii) the duly executed Subsidiary Security Agreement
executed and delivered by each Subsidiary of the Borrower (other than
any of the Foreign Subsidiaries and the LaunchCo Joint Ventures
existing as of the Fourth Amendment Date), together with appropriate
UCC-1 financing statement forms; and
(iv) a loan certificate from each new Guarantor in
substantially the form attached to the Credit Agreement as Exhibit T,
including a certificate of incumbency with respect to each officer
authorized to execute Loan Documents on behalf of such Guarantor,
together with appropriate attachments which shall include, without
limitation, the following items if such Guarantor is a corporation,
and the analogous items if such Guarantor is a partnership or a
limited liability company: (A) a copy of the articles or certificate
of incorporation of such Guarantor, certified to be true, complete and
correct by the Secretary of State of the state of such Guarantor's
organization, and a true, complete and correct copy of the by-laws of
such Guarantor; (B) a true, complete and correct copy of the
resolutions of the board of directors of such Guarantor authorizing
the execution, delivery and performance by such Guarantor of the Loan
Documents to which it is a party; and (C) true, correct and complete
copies of any agreements to which such Guarantor is a party in effect
with respect to the voting rights, ownership interests, or management
of such Guarantor.
(b) The Credit Parties shall have received payment of all fees
and expenses (including, without limitation, the amendment fees referred to in
Section 22 above) due and payable on the
29
Fourth Amendment Date in respect of the Credit Agreement, this Amendment and the
transactions contemplated hereby and thereby.
(c) No event shall have occurred since April 30, 2001, which
shall have had a Materially Adverse Effect on the Borrower and its Restricted
Subsidiaries taken as a whole except as set forth in Section 19 above.
(d) The Agents shall have received evidence satisfactory to them
that the Borrower shall have received additional equity contributions of at
least $50,000,000 from the Controlling Shareholders and the Co-Investors, on
terms reasonably acceptable in all respects to the Agents, and at least
$35,000,000 shall have been used to permanently reduce the Loans pursuant to
Section 2.7(e) of the Credit Agreement.
(e) The Agents shall have received a Performance Certificate,
which certificate shall demonstrate that, as of the Effective Date and based on
the financial statements of the Borrower delivered with respect to the month
ending May 31, 2001, the Borrower has, after giving effect to this Amendment and
pro forma for the pay-down of the Loans in connection herewith, (i) a Total
Leverage Ratio of 5.45 to 1.00 or less and (ii) a Senior Leverage Ratio of 2.30
to 1.00 or less, in each case based upon the Borrower's financial performance
for the twelve (12) month period ended May 31, 2001.
(f) The Agents shall have received such other information,
documents, instruments or approvals as the Agents or their counsel may
reasonably require by July 10, 2001.
24. Conditions Subsequent. As a condition subsequent to the
---------------------
amendments set forth in this Amendment, the Borrower shall deliver to the
Administrative Agent on or before August 15, 2001, certificates of good standing
for each new Guarantor issued by the Secretary of State of such Guarantor's
organization and by the Secretary of State or similar state official for each
state in which such Guarantor is required to or has qualified to do business.
25. Representations and Warranties. The Borrower, for itself and on
------------------------------
behalf of each of its Subsidiaries, agrees, represents and warrants in favor of
the Lead Arranger, the Syndication Agent, the Documentation Agent, the
Administrative Agent and the Credit Parties that:
(a) This Amendment has been executed and delivered by duly
authorized representatives of the Borrower, and the Credit Agreement, as
modified and amended by this Amendment, constitutes a legal, valid and binding
obligation of the Borrower and is enforceable against the Borrower in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights generally
and by the application of general equitable principles;
(b) After giving effect to this Amendment, no Default or Event of
Default with respect to the Borrower shall have occurred and be continuing; and
(c) No event contemplated in connection with this Amendment has
occurred, which has not been consented to or waived, the occurrence of which
constitutes, or with the passage of time or giving of notice or both would
constitute, a material default by the Borrower or any of its Subsidiaries under
any material indenture, agreement or other instrument, or any judgment, decree
or order, to which the Borrower
30
or any of its Subsidiaries is a party or by which the Borrower or any of its
Subsidiaries or any of their respective properties may be bound or affected.
26. Effect on the Credit Agreement. Except as specifically provided
------------------------------
herein, the Credit Agreement shall remain in full force and effect, and is
hereby ratified, reaffirmed and confirmed. This Amendment shall be deemed to be
a Loan Document for all purposes.
27. Counterparts. This Amendment may be executed in any number of
------------
separate counterparts and by the different parties hereto on separate
counterparts, each of which shall be deemed an original and all of which, taken
together, shall be deemed to constitute one and the same instrument. In proving
this Amendment in any judicial proceedings, it shall not be necessary to produce
or account for more than one such counterpart signed by the party against whom
such enforcement is sought. Any signatures delivered by a party by facsimile
transmission shall be deemed an original signature hereto.
28. Law of Contract. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE
---------------
WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED WHOLLY WITHIN SUCH STATE.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
31
IN WITNESS WHEREOF, this Amendment has been duly executed as of the
day and year first written above.
BORROWER: ZIFF XXXXX MEDIA INC.
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President and Conroller
LEAD ARRANGER: CIBC WORLD MARKETS CORP.
By: /s/ Xxxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Managing Director
SYNDICATION AGENT: BANKERS TRUST COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
DOCUMENTATION
AGENT: FLEET NATIONAL BANK
By: /s/ Xxxxxxx Xxxxxxxxx
Name: Xxxxxxx Xxxxxxxxx
Title: Vice President
ADMINISTRATIVE CANADIAN IMPERIAL BANK OF
AGENT: COMMERCE
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Managing Director, CIBC World Markets
Corp., as Agent
LENDERS: FIRSTAR BANK, N.A.
By: /s/ Xxxxxxx X. Best
-----------------------------------------
Name: XXXXXXX X. BEST
---------------------------------------
Title: BANKING OFFICER
--------------------------------------
KZH STERLING LLC
By: /s/ Xxxxx Xxx
-----------------------------------------
Name: Xxxxx Xxx
--------------------------------------------
Title: Authorized Agent
--------------------------------------
KATONAH I LTD.
By: /s/ Xxxxx Xxxxx Xxxxx
-----------------------------------------
Name: XXXXX XXXXX XXXXX
---------------------------------------
Title: AUTHORIZED OFFICER
--------------------------------------
KATONAH CAPITAL, L.L.C
AS MANAGER
KATONAH II LTD
By: /s/ Xxxxx Xxxxx Xxxxx
-----------------------------------------
Name: XXXXX XXXXX XXXXX
---------------------------------------
Title: AUTHORIZED OFFICER
--------------------------------------
KATONAH CAPITAL, L.L.C
AS MANAGER
PILGRIM CLO 1999-1 LTD.
By: ING Pilgrim Investments,
as its investment manager
By: /s/ Xxxxxx X. Xxx
-----------------------------------------
Name: Xxxxxx X. Xxx
---------------------------------------
Title: Senior Vice President
--------------------------------------
SEQUILS-PILGRIM I LTD
By: ING Pilgrim Investments,
as its investment manager
By: /s/ Xxxxxx X. Xxx
-----------------------------------------
Name: Xxxxxx X. Xxx
---------------------------------------
Title Senior Vice President
---------------------------------------
PILGRIM AMERICA HIGH INCOME
INVESTMENTS LTD, (as assignee)
By: ING Pilgrim Investments,
as its investment manager
By: /s/ Xxxxxx X. Xxx
-----------------------------------------
Name: Xxxxxx X. Xxx
---------------------------------------
Title: Senior Vice President
--------------------------------------
ML CLO XV PILGRIM AMERICA
(CAYMAN) LTD.
By: ING Pilgrim investments,
as its investment manager
By: /s/ Xxxxxx X. Xxx
-----------------------------------------
Name: Xxxxxx X. Xxx
---------------------------------------
Title: Senoir Vice President
--------------------------------------
PILGRIM PRIME RATE TRUST
By: ING Pilgrim investments,
as its investment manager
By: /s/ Xxxxxx X. Xxx
-----------------------------------------
Name: Xxxxxx X. Xxx
---------------------------------------
Title: Senior Vice President
--------------------------------------
CHEVY CHASE BANK FSB
By: /s/[ILLEGIBLE]
-----------------------------------------
Name: [ILLEGIBLE]
---------------------------------------
Title: Assistant Vice President
--------------------------------------
XXXXXX XXXXXXX PRIME INCOME TRUST,
By: /s/ [ILLEGIBLE]
--------------------------------------------
Name: [ILLEGIBLE]
---------------------------------------
Title: Vice President
--------------------------------------
THE BANK OF NOVA SCOTIA
By: /s/ XXX X. XXXXXXX
-----------------------------------------
Name: XXX X. XXXXXXX
---------------------------------------
Title: AUTHORIZED SIGNATORY
--------------------------------------
ORIX USA CORPORATION
By: /s/ XXXXXXXX XXXXXXXX
-----------------------------------------
Name: XXXXXXXX XXXXXXXX
---------------------------------------
Title: Executive Vice President
--------------------------------------
SEABOARD CLO 2000 LTD.
By: /s/ X. X. Xxxxx
-----------------------------------------
Name: Xxxxxxxx X X Xxxxx, Xx.
---------------------------------------
Title: CEO of Seaboard & Co.
--------------------------------------
Its Collateral Manager
THE BANK OF NEW YORK
By: /s/ Xxxxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxxxx X. Xxxxxx
---------------------------------------
Title: Senior Vice President
--------------------------------------
SUNAMERICA LIFE INSURANCE COMPANY
By: /s/ Xxxx X. Xxxxxx III
-----------------------------------------
Name: Xxxx X. Xxxxxx III
---------------------------------------
Title: Authorized Agent
--------------------------------------
LENDERS: CIBC INC.
By: /s/ Xxxxxxx Xxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxx
---------------------------------------
Title: Managing Director, CIBC World Markets
Corp, as Agent
GLENEAGDES TRADING LLC
By: /s/ Xxx X. Xxxxxx
-----------------------------------------
Name: Xxx X. Xxxxxx
---------------------------------------
Title: Asst. Vice President
--------------------------------------
BLUE SQAURE FUNDING LIMITED
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
---------------------------------------
Title: Vice President
--------------------------------------
THERMOPYLAE FUNDING CORP.
By: /s/ Xxxxx X Xxxxxxx
-----------------------------------------
Name: XXXXX X XXXXXXX
---------------------------------------
Title: VICE PRESIDENT
--------------------------------------
Highland Loan Funding V Ltd.
By: Highland Capital Management, L.P.
As Collateral Manager
Name: /s/ Xxxx X Xxxxx CFA
-------------------------------
By: Xxxx X Xxxxx CFA
Title: Executive Vice President
Highland Capital Management L.P.
Highland Legacy Limited
By: Highland Capital Management, L.P.
As Collateral Manager
Name: /s/ Xxxx X Xxxxx CFA
-------------------------------
By: Xxxx X Xxxxx CFA
Title: Executive Vice President
Highland Capital Management X.X.
XXXXXXX HIGH YIELD PARTNERS L.P.
By: /s/ Xxxx Xxxxx
-----------------------------------------
Name: XXXX XXXXX
---------------------------------------
Title: PRINCIPAL
--------------------------------------
CARLYLE HIGH YIELD PARTNERS III L.P.
By: /s/ Xxxx Xxxxx
-----------------------------------------
Name: XXXX XXXXX
---------------------------------------
Title: PRINCIPAL
--------------------------------------
CARLYLE HIGH YIELD PARTNERS II LTD
By: /s/ Xxxx Xxxxx
-----------------------------------------
Name: XXXX XXXXX
---------------------------------------
Title: PRINCIPAL
--------------------------------------
XXXX XXXXXXX LIFE INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxx
-----------------------------------------
Name: XXXXXX XXXXX
---------------------------------------
Title: Managing Director
--------------------------------------
GOLDENTREE HIGH YIELD OPPORTUNITIES LLP
By: /s/ Xxxxxxxxx Xxxxxx
-----------------------------------------
Name: XXXXXXXXX XXXXXX
---------------------------------------
Title: PARTNER
--------------------------------------
CAPTIVA FINANCE LIMITED
By: /s/ Xxxxx Eggllshaw
-----------------------------------------
Name: Xxxxx Eggllshaw
---------------------------------------
Title: Director
--------------------------------------
XXX XXXXXX CLO II LTD
By: Xxx Xxxxxx Management Inc, As
Collateral Manager
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: XXXXXX X. XXXXXX
---------------------------------------
Title: PRINCIPAL
---------------------------------------
XXX XXXXXX CLO I LTD
By: Xxx Xxxxxx Management Inc., as
Collateral Agent
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: XXXXXX X. XXXXXX
---------------------------------------
Title: PRINCIPAL
--------------------------------------
XXX XXXXXX SENIOR INCOME TRUST
By: Xxx Xxxxxx Investment Advisory Corp.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: XXXXXX X. XXXXXX
---------------------------------------
Title: PRINCIPAL
--------------------------------------
XXX XXXXXX SENIOR FLOATING RATE FUND
By: Xxx Xxxxxx Investment Advisory Corp.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: XXXXXX X. XXXXXX
---------------------------------------
Title: PRINCIPAL
--------------------------------------
XXX XXXXXX PRIME RATE INCOME TRUST
By: Xxx Xxxxxx Investment Advisory Corp.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: XXXXXX X. XXXXXX
---------------------------------------
Title: PRINCIPAL
--------------------------------------
AERIES FINANCE II LTD.
By: INVESCO Senior Secured Management, Inc.
as Sub-Managing Agent
By: /s/ Xxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
AMARA - 1 FINANCE LTD.
By: INVESCO Senior Secured Management, Inc,
as Subadvisor
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
AMARA 2 FINANCE LTD.
By: INVESCO Senior Secured Management, Inc.,
as Subadvisor
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
AVALON CAPITAL LTD.
By: INVESCO Senior Secured Management, Inc.,
as Portfolio Advisor
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
OASIS COLLATERALIZED HIGH INCOME
PORTFOLIO - 1, LTD.
By: INVESCO Senior Secured Management, Inc.,
as Subadvisor
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
AVALON CAPITAL LTD. 2
By: INVESCO Senior Secured Management, Inc.
as Portfolio Advisor
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
AIM FLOATING RATE FUND
By: INVESCO Senior Secured Management, Inc.
As Attorney in fact
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
CHARTER VIEW PORTFOLIO
By: INVESCO Senior Secured Management, Inc.
As Investment Advisor
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
XXXXXXX XXX 0000-0 LTD.
By: INVESCO Senior Secured Management, Inc.
As Portfolio Advisor
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
TRITON CBO III, LIMITED
By: INVESCO Senior Secured Management, Inc.
As Investment Advisor
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------
Title: Authorized Signatory
--------------------------------------
CERES II FINANCE LTD.
By: INVESCO Senior Secured Management,
Inc. as Sub-Managing Agent (Financial)
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------------------
Title: Authorized Signatory
--------------------------------------------
PROMETHEUS INVESTMENT FUNDING NO. 1 LTD.
By: CPF Asset Advisory, LLC, as Investment Manager
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------------
Name: XXXXXXX X. XXXXXX
---------------------------------------------
Title: MANAGING DIRECTOR
--------------------------------------------
FIRST DOMINION FUNDING I
By: /s/ XXXXXX X. XXXXXXX
-----------------------------------------------
Name: XXXXXX X. XXXXXXX
---------------------------------------------
Title: AUTHORIZED SIGNATORY
--------------------------------------------
XXXXXX FINANCIAL, INC.
By: /s/ Xxxxxx X. Rag
-----------------------------------------------
Name: Xxxxxx X. Rag
---------------------------------------------
Title: Assistant Vice President
--------------------------------------------
NOVA CDO 2001 LTD.(formerly known [ILLEGIBLE]
Assc. Ltd)
By: [ILLEGIBLE]
-----------------------------------------------
Name: [ILLEGIBLE]
---------------------------------------------
Title: [ILLEGIBLE]
--------------------------------------------
SIGNATURE 1A (CAYMAN) LTD.
By: Xxxx Xxxxxxx Life Insurance Company,
Portfolio Advisor
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------------
Name: Xxxxxx X. Xxxxx
---------------------------------------------
Title: Senior Managing Director
--------------------------------------------
SIGNATURE 3 LIMITED
By: Xxxx Xxxxxxx Life Insurance Company, as
Portfolio Advisor
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------------
Name: Xxxxxx X. Xxxxx
---------------------------------------------
Title: Senior Managing Director
--------------------------------------------
MOUNTAIN CAPITAL CLO II
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------------
Name: XXXXXX X. XXXXX
-----------------------------------------------
Title: DIRECTOR
--------------------------------------------
XXXXXXX XXXXX MASTER SENIOR
FLOATING RATE FUND, INC.
By: /s/ XXXXXX XXXXX
-----------------------------------------------
Name: XXXXXX XXXXX
---------------------------------------------
Title: AUTHORIZED SIGNATORY
--------------------------------------------
MASTER SENIOR FLOATING RATE TRUST
By: /s/ XXXXXX XXXXX
------------------------------------------------
Name: XXXXXX XXXXX
----------------------------------------------
Title: AUTHORIZED SIGNATORY
---------------------------------------------
