<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 17, 1995
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------
AMENDMENT NO. 21 -- FINAL AMENDMENT
TO
SCHEDULE 14D-1*
Tender Offer Statement Pursuant to Section 14(d)(1)
of the Securities Exchange Act of 1934
QVC, INC.
(Name of Subject Company)
COMCAST CORPORATION
TELE-COMMUNICATIONS, INC.
(Bidders)
COMMON STOCK, $.01 PAR VALUE PER SHARE
(Title of Class of Securities)
747262 10 3
(CUSIP Number of Class of Securities)
Stanley L. Wang Stephen M. Brett
Comcast Corporation Tele-Communications, Inc.
1500 Market Street 5619 DTC Parkway
Philadelphia, PA 19102 Englewood, CO 80111
(215) 665-1700 (303) 267-5500
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of Bidder)
------------------------
Copies to:
Dennis S. Hersch Frederick H. McGrath
Davis Polk & Wardwell Baker & Botts, L.L.P.
450 Lexington Avenue 885 Third Avenue
New York, NY 10017 New York, NY 10022
(212) 450-4000 (212) 705-5000
* This Statement also constitutes Amendment No. 22 to the Schedule
13D filed by Tele-Communications, Inc. and Amendment No. 43 to the
Schedule 13D filed by Comcast Corporation in each case with respect
to the securities of the Subject Company.
Page 1 of __ Pages
<PAGE> 2
Comcast Corporation and Tele-Communications, Inc. hereby amend and
supplement the Tender Offer Statement on Schedule 14D-1 of QVC Programming
Holdings, Inc., Comcast Corporation and Tele-Communications, Inc. filed with the
Securities and Exchange Commission on August 11, 1994 (as previously amended and
supplemented, the "Schedule 14D-1") with respect to Bidders' Offer to Purchase
for cash all outstanding shares of Common Stock and Preferred Stock of the
Company.
Information contained in the Schedule 14D-1 as hereby amended and
supplemented with respect to Comcast, Liberty, TCI and the Purchaser and their
respective executive officers, directors and controlling persons is given solely
by such person, and no other person has responsibility for the accuracy or
completeness of information supplied by such other persons.
Capitalized terms used but not defined herein have the meaning assigned to
them in the Offer to Purchase and the Schedule 14D-1.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) and (b) The information set forth under "Special Factors -- Financing
of the Transaction" in the Offer to Purchase and "Financing of the Transaction"
in the Supplement is hereby amended and supplemented to include the following
information:
Immediately following the consummation of the Merger, the Surviving
Corporation executed definitive documentation for the Permanent facility. The
Credit Agreement, dated as of February 15, 1995, among the Surviving Corporation
and the Banks listed on the signature pages thereof relating to the Permanent
Facility is attached hereto as Exhibit (b)(6).
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF
THE BIDDERS.
(f) and (g) The information set forth under "Special Factors -- Certain
Effects of the Transaction" in the Offer to Purchase is hereby amended and
supplemented to include the information set forth in Item 6 of this Amendment.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a) and (b) The information set forth under "Introduction", "Special
Factors - Background of the Transaction", "- Interests of Certain Persons in the
Transaction" and "The Tender Offer - 7. Certain Information Concerning the
Purchaser and Parent Purchasers" in the Offer to Purchase is hereby amended and
supplemented to include the following information:
Page 2 of __ Pages
<PAGE> 3
The Offer expired at 12:00 Midnight, New York City Time, on Thursday,
February 9, 1995. As of the close of business on February 16, 1995,
approximately 33,400,352 shares of QVC Common Stock, 468 shares of QVC Series B
Preferred Stock and 31,639 shares of QVC Series C Preferred Stock, including
Shares for which certificates were delivered pursuant to the guaranteed delivery
procedure described in the Offer the Purchase and the related Letters of
Transmittal, had been validly tendered and not previously withdrawn prior to the
Expiration Date. The Purchaser has accepted for purchase all such Shares.
As a result of the consummation of the Transaction, the Common Stock became
eligible for termination of registration pursuant to Section 12(g)(4) of the
Exchange Act. On February 16, 1995, the Surviving Corporation filed a
certification on Form 15 with the Commission, suspending its obligation to file
reports pursuant to Section 13 or Section 15(d) under the Exchange Act. As
previously disclosed, the Common Stock has ceased to be traded on the Nasdaq
National Market.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(33) Notice of Merger dated February 17, 1995.
(a)(34) Letter of Transmittal to accompany Notice of Merger (including
Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9).
(b)(6) Credit Agreement, dated as of February 15, 1995, among the Surviving
Corporation and the Banks listed on the signature pages thereof.
Page 3 of __ Pages
<PAGE> 4
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: February 17, 1995
COMCAST CORPORATION
By: /s/ JULIAN A. BRODSKY
----------------------------
Name: Julian A. Brodsky
Title: Vice Chairman
TELE-COMMUNICATIONS, INC.
By: /s/ STEPHEN M. BRETT
----------------------------
Name: Stephen M. Brett
Title: Executive Vice
President
Page 4 of __ Pages
<PAGE> 5
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIALLY
NUMBER DESCRIPTION NUMBERED PAGE
- ------- ----------- -------------
<S> <C> <C>
(a)(33) Notice of Merger dated
February 17, 1995.
(a)(34) Letter of Transmittal to
accompany Notice of Merger
(including Guidelines for
Certification of Taxpayer
Identification Number on
Substitute Form W-9).
(b)(6) Credit Agreement, dated as of
February 15, 1995, among the
Surviving Corporation and the
Banks listed on the signature
pages thereof.
</TABLE>
Page 5 of __ Pages
<PAGE> 1
QVC, INC.
1365 ENTERPRISE DRIVE
WEST CHESTER, PA 19380
NOTICE OF MERGER
OF
QVC PROGRAMMING HOLDINGS, INC.
WITH AND INTO
QVC, INC.
To the Former Holders of Common Stock,
Series B Preferred Stock and
Series C Preferred Stock
of QVC, INC.:
NOTICE IS HEREBY GIVEN pursuant to Sections 253(d) and 262(d)(2) of the
General Corporation Law of the State of Delaware (the "GCL") that the merger
(the "Merger") of QVC Programming Holdings, Inc., a Delaware corporation (the
"Purchaser"), with and into QVC, Inc., a Delaware corporation ("QVC"), became
effective on February 15, 1995 (the "Effective Date of the Merger"). The
Purchaser was jointly owned by Comcast Corporation, a Pennsylvania corporation
(57.4%), and Liberty Media Corporation (together with Comcast Corporation, the
"Parent Purchasers"), a Delaware corporation (42.6%) and a wholly-owned
subsidiary of Tele-Communications, Inc., a Delaware corporation. Immediately
prior to the Effective Date of the Merger, the Purchaser owned at least 90% of
the shares of Common Stock, par value $.01 per share (the "Common Stock"), at
least 90% of the shares of Series B Preferred Stock, par value $.10 per share,
and at least 90% of the shares of Series C Preferred Stock, par value $.10 per
share (together with the Series B Preferred Stock, the "Preferred Stock"), of
the Company. This notice is first being mailed on February 17, 1995 to holders
of shares of Common Stock and Preferred Stock (together, the
"Shares")immediately prior to the Effective Date of the Merger (the "Former
Stockholders").
As described below, under the terms of the Merger and the applicable
provisions of Delaware law, the Shares ceased to be outstanding at the Effective
Date of the Merger, and each such Share (other than Shares held by the Purchaser
or any subsidiary of the Purchaser or held in the treasury of QVC or any wholly
owned subsidiary of QVC, all of which were cancelled (the "Cancelled Shares"),
and Shares held by stockholders who properly exercise the dissenters' rights
referred to below) now represents solely a right to receive $46.00 (in the case
of shares of Common Stock) or $460.00 (in the case of shares of Preferred Stock)
per Share in cash without interest. TO RECEIVE PAYMENT OF THE $46.00 OR $460.00
PER SHARE IN CASH PAYABLE PURSUANT TO THE MERGER, FORMER STOCKHOLDERS MUST
COMPLETE THE ENCLOSED LETTER OF TRANSMITTAL AND MUST PRESENT THE LETTER OF
TRANSMITTAL AND THE STOCK CERTIFICATES FORMERLY REPRESENTING SHARES TO THE BANK
OF NEW YORK, AS EXCHANGE AGENT, IN THE MANNER DESCRIBED BELOW AND IN THE LETTER
OF TRANSMITTAL THAT ACCOMPANIES THIS NOTICE.
The Purchaser acquired its ownership of at least 90% of each class of the
outstanding Shares following the consummation of its tender offer for all
outstanding Shares of QVC that expired on February 9, 1995 (the "Tender Offer"),
at a price of $46.00 (in the case of shares of Common Stock) or $460.00 (in the
case of shares of Preferred Stock) per Share, net to the seller in cash and
without interest. The Tender Offer was made pursuant to an Agreement and Plan of
Merger dated as of August 4, 1994 (as amended, the "Merger Agreement") among the
Parent Purchasers, TCI Cable Investments, Inc. (f/k/a Liberty Media
Corporation), the Purchaser and QVC. Each of the conditions to the Tender Offer
or the Merger was satisfied or waived prior to the consummation thereof. For
more information concerning the Tender Offer, the Merger Agreement and other
related agreements, Former Stockholders should consult the Tender Offer
Statement on Schedule 14D-1 filed by the Purchaser and the Parent Purchasers and
the Rule 13e-3 Transaction Statement on Schedule 13E-3 filed by the Purchaser,
the Parent Purchasers and QVC with the Securities and Exchange Commission (the
"SEC") on August 11, 1994, in each case together with the amendments and
exhibits thereto (the "Schedule 14D-1" and the "Schedule 13E-3", respectively).
For a description of certain federal tax consequences to Former Stockholders in
connection with the Merger, Former Stockholders should consult the Offer to
Purchase dated August 11, 1994 (as amended by the Supplement to Offer to
Purchase dated February 3, 1995, the "Offer
1
<PAGE> 2
to Purchase") prepared in connection with the Tender Offer, a copy of which
accompanies this Notice of Merger. For information with respect to the interest
of certain executive officers and directors of QVC in connection with the Tender
Offer and the Merger, Former Stockholders should consult the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by QVC with the
SEC on August 11, 1994 (the "Solicitation/Recommendation Statement"), a copy of
which accompanies this Notice of Merger, together with any amendments and
exhibits thereto (the "Schedule 14D-9").
Until the Effective Date of the Merger, QVC filed information with the SEC
under the Securities Exchange Act of 1934, as amended, relating to its business,
financial condition and other matters. Such reports and other information
(including proxy statements distributed to QVC's stockholders and filed with the
SEC), and the Schedule 14D-1, the Schedule 13E-3 and the Schedule 14D-9, may be
inspected and copied at the public reference facilities maintained by the SEC at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and should also
be available for inspection and copying at the regional offices of the SEC in
New York (Jacob K. Javits Federal Building, 26 Federal Plaza, New York, New York
10278) and Chicago (Everett McKinley Dirksen Building, 219 South Dearborn
Street, Chicago, Illinois 60604). Copies of such material can also be obtained
from the Public Reference Section of the Commission in Washington, D.C. 20549,
at prescribed rates.
Because the Purchaser held in excess of 90% of each class of Shares
outstanding, no action was required by any QVC stockholders other than the
Purchaser under applicable Delaware law, in order for the Merger to become
effective. On the Effective Date of the Merger, the separate corporate existence
of the Purchaser terminated and QVC, as the surviving corporation in the Merger
(sometimes referred to in this notice as "Surviving QVC"), became jointly owned
by the Parent Purchasers in the same proportion as their ownership of the
Purchaser prior to the Merger.
Under the terms of the Merger and the applicable provisions of Delaware
law, the Shares ceased to be outstanding at the Effective Date of the Merger,
and each such Share (other than the Cancelled Shares and Shares as to which
appraisal rights are properly exercised) now represents solely a right to
receive $46.00 or $460.00, as the case may be, per Share in cash without
interest. In addition, under the terms of the Merger and the applicable
provisions of Delaware law, each share of common stock, par value $.01 per
share, of the Purchaser outstanding at the Effective Date of the Merger (all of
which were owned by the Parent Purchasers) was converted into one share of
common stock, par value $.001 per share, of Surviving QVC. As a result, all of
the outstanding common stock of Surviving QVC is now owned by the Parent
Purchasers.
The conversion of Shares (other than the Cancelled Shares and Shares as to
which appraisal rights are properly exercised) into the right solely to receive
$46.00 or $460.00, as the case may be, per Share in cash occurred at the
Effective Date of the Merger. The Bank of New York has been appointed Exchange
Agent (the "Exchange Agent") for the purposes of receiving the certificates
formerly representing Shares and transmitting cash payments to Former
Stockholders. A Letter of Transmittal accompanies this Notice of Merger for your
use in surrendering your certificates for Shares to the Exchange Agent.
Certificates for Shares, accompanied by a properly completed Letter of
Transmittal, should be presented to the Exchange Agent promptly in order to
obtain payment of $46.00 or $460.00, as the case may be, per Share pursuant to
the Merger. At the Effective Date of the Merger, the Share transfer books of QVC
were closed and no transfers of Shares could thereafter be made. In the event of
a transfer of ownership of Shares which is not registered in the transfer
records of QVC, the $46.00 or $460.00, as the case may be, per share in cash may
be paid to a transferee if the certificate evidencing such Shares is presented
to the Exchange Agent accompanied by all documents required to evidence and
effect such transfer and by evidence that any applicable stock transfer taxes
have been paid. At any time following six months after the Effective Date of the
Merger, any funds (including the proceeds of any investments thereof) that have
been made available to the Exchange Agent and that have not been disbursed to
holders of certificates for Shares shall be repaid to Surviving QVC, and
thereafter such holders will be entitled to look to Surviving QVC (subject to
abandoned property, escheat or other similar laws) only as general creditors
there with respect to the cash payable upon due surrender of such certificates.
Until a certificate that formerly represented Shares (other than the
Cancelled Shares and Shares as to which appraisal rights are properly exercised)
is actually surrendered for exchange, it shall represent solely the right to
receive the cash into which the Shares it theretofore represented were
converted, without interest. Upon the surrender and exchange of such a
certificate to the Exchange Agent along with a properly completed Letter of
Transmittal, the holder thereof shall be paid as soon as practicable, without
interest, by check mailed to the address specified by such holder in the Letter
of Transmittal, for the Shares held by it at the Effective Date of the Merger.
2
<PAGE> 3
Under Sections 253(d) and 262 of the GCL, the Former Stockholders on the
Effective Date of the Merger who do not wish to accept the cash payment to which
they became entitled pursuant to the Merger have the right to seek appraisal of
the value of their Shares in the Delaware Court of Chancery. Former Stockholders
who do not wish to accept the $46.00 or $460.00, as the case may be, in cash per
Share and who wish to assert their rights to an appraisal as to such Shares must
so notify Surviving QVC in writing at: Secretary, QVC, Inc., 1365 Enterprise
Drive, West Chester, PA 19380, within 20 days after the date of mailing of this
Notice of Merger, as indicated by the postmark on the envelope containing this
Notice of Merger. Surviving QVC recommends that such notification to it be sent
by registered or certified mail, with return receipt requested. Such written
notice from a Former Stockholder wishing to assert appraisal rights must
reasonably inform QVC of the identity of such stockholder, and that such
stockholder intends thereby to demand appraisal of its Shares. IN ADDITION, TO
PERFECT THEIR APPRAISAL RIGHTS, DISSENTING FORMER STOCKHOLDERS MUST COMPLY WITH
ALL OF THE CONDITIONS AND OTHER PROCEDURES EXPLAINED UNDER "RIGHTS OF DISSENTING
STOCKHOLDERS" IN ANNEX I TO THIS NOTICE AND SET FORTH IN THE TEXT OF SECTIONS
253(D) AND 262 OF THE GCL, COPIES OF WHICH ARE ATTACHED TO THIS NOTICE AS ANNEX
II AND ANNEX III, RESPECTIVELY.
For more information concerning the Tender Offer and the Merger, Former
Stockholders are directed to the Offer to Purchase and the
Solicitation/Recommendation Statement, copies of which accompany this Notice of
Merger.
UNDER DELAWARE LAW, THE PROCEDURES TO OBTAIN APPRAISAL RIGHTS MUST BE
CARRIED OUT BY AND IN THE NAME OF HOLDERS OF RECORD OF SHARES. Former
Stockholders who are the beneficial but not the record owners of Shares (such as
Shares held by a broker in "street name" rather than in the name of the
beneficial owner thereof) and who wish to exercise such appraisal rights, are
advised to consult promptly with the record owners as to the timely exercise of
such rights and to cause such record owner to make the appropriate demand.
FAILURE TO STRICTLY FOLLOW THE PROCEDURES SET FORTH IN SECTION 262 OF THE
GCL MAY RESULT IN A TERMINATION OR LOSS OF APPRAISAL RIGHTS UNDER SECTION 262 OF
THE GCL.
The foregoing description does not purport to be a complete summary of the
applicable provisions of Sections 253(d) and 262 of the GCL, and is qualified in
its entirety by reference to such provisions, which are attached hereto in full
as Annex II and Annex III, and the summary of Section 262, which is attached
hereto as Annex I.
QVC, INC.
Dated: February 17, 1995
3
<PAGE> 4
ANNEX I
RIGHTS OF DISSENTING STOCKHOLDERS
Under Section 262 of the GCL, any Former Stockholder who does not wish to
accept the per Share cash consideration pursuant to the Merger has the right to
seek an appraisal and be paid the "fair value" of its Shares at the Effective
Date of the Merger (exclusive of any element of value arising from the
accomplishment or expectation of the Merger) judicially determined and paid to
it in cash provided that such holder complies with the provisions of such
Section 262 of the GCL. QVC is required to send a notice to that effect to each
Former Stockholder within ten days after the Effective Date of the Merger. This
Notice of Merger constitutes such notice.
The following is a brief summary of the statutory procedures to be followed
by a Former Stockholder in order to dissent from the Merger and perfect
appraisal rights under Delaware law. THIS SUMMARY IS NOT INTENDED TO BE COMPLETE
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SECTION 262 OF THE GCL, THE
TEXT OF WHICH IS SET FORTH IN ANNEX III. ANY FORMER STOCKHOLDER CONSIDERING
DEMANDING APPRAISAL IS ADVISED TO CONSULT LEGAL COUNSEL.
Former Stockholders of record who desire to exercise their appraisal rights
must fully satisfy all of the following conditions. A written demand for
appraisal of Shares must be delivered to the Secretary of QVC within 20 days
after the date of mailing of this Notice of Merger.
A demand for appraisal must be executed by or for the stockholder of
record, fully and correctly, as such stockholder's name appears on the stock
certificates. If Shares are owned of record in a fiduciary capacity, such as by
a trustee, guardian or custodian, such demand must be executed by the fiduciary.
If Shares are owned of record by more than one person, as in a joint tenancy or
tenancy in common, such demand must be executed by all joint owners. An
authorized agent, including an agent for two or more joint owners, may execute
the demand for appraisal for a stockholder of record; however, the agent must
identify the record owner and expressly disclose the fact that in exercising the
demand, it is acting as agent for the record owner.
A record owner, such as a broker, who holds Shares as a nominee for others,
may exercise appraisal rights with respect to the Shares held for all or less
than all beneficial owners of Shares as to which the holder is the record owner.
In such case the written demand must set forth the number of Shares covered by
such demand. Where the number of Shares is not expressly stated, the demand will
be presumed to cover all Shares outstanding at the Effective Time of the Merger
in the name of such record owner. Beneficial owners who are not record owners
and who intend to exercise appraisal rights should instruct the record owner to
comply strictly with the statutory requirements with respect to the exercise of
appraisal rights before the expiration of the 20-day period.
Former Stockholders who elect to exercise appraisal rights must mail or
deliver their written demands to: Secretary, QVC, Inc., 1365 Enterprise Drive,
West Chester, Pennsylvania 19380. The written demand for appraisal should
specify the stockholder's name and mailing address, the number and class of
Shares covered by the demand and that the stockholder is thereby demanding
appraisal of such Shares.
Within 120 days after the Effective Date of the Merger, either QVC or any
stockholder who has complied with the required conditions of Section 262 of the
GCL and who is otherwise entitled to appraisal rights may file a petition in the
Delaware Court of Chancery demanding a determination of the fair value of the
Shares of the dissenting stockholders. If a petition for an appraisal is timely
filed, after a hearing on such petition, the Delaware Court of Chancery will
determine which stockholders are entitled to appraisal rights and thereafter
will appraise the Shares owned by such stockholders, determining the fair value
of such Shares, exclusive of any element of value arising from the
accomplishment or expectation of the Merger, together with a fair rate of
interest to be paid, if any, upon the amount determined to be the fair value. In
determining fair value, the Delaware Court of Chancery is to take into account
all relevant factors. In Weinberger v. UOP, Inc., et al., the Delaware Supreme
Court discussed the factors that could be considered in determining fair value
in an appraisal proceeding, stating that "proof of value by any techniques or
methods which are generally considered acceptable in the financial community and
otherwise admissible in court" should be considered and that "[f]air price
obviously requires consideration of all relevant factors involving the value of
a company." The Delaware Supreme Court stated that in making this determination
of fair value the court must consider "market value, asset value, dividends,
earning prospects, the nature of the enterprise and any other facts which were
known or which could be ascertained as of the date of merger which throw any
light on future prospects of the merged corporation. . ."
I-1
<PAGE> 5
The Delaware Supreme Court has construed Section 262 of the GCL to mean
that "elements of future value, including the nature of the enterprise, which
are known or susceptible of proof as of the date of the merger and not the
product of speculation, may be considered." However, the court noted that
Section 262 of the GCL provides that fair value is to be determined "exclusive
of any element of value arising from the accomplishment or expectation of the
merger."
Former Stockholders who in the future consider seeking appraisal should
have in mind that the fair value of their Shares determined under Section 262 of
the GCL could be more than, the same as, or less than the per Share cash
consideration paid pursuant to the Merger if they do seek appraisal of their
Shares, and that opinions of investment banking firms as to fairness from a
financial point of view are not necessarily opinions as to fair value under
Section 262 of the GCL. Moreover, the Parent Purchasers intend to cause
Surviving QVC to argue in any appraisal proceeding that, for purposes thereof,
the "fair value" of the Shares is less than that paid in the Offer. The cost of
the appraisal proceeding may be determined by the Delaware Court of Chancery and
taxed upon the parties as the Delaware Court of Chancery deems equitable in the
circumstances. Upon application of a dissenting stockholder, the Delaware Court
of Chancery may order that all or a portion of the expenses incurred by any
dissenting stockholder in connection with the appraisal proceeding, including,
without limitation, reasonable attorneys' fees and the fees and expenses of
experts, be charged pro rata against the value of all Shares entitled to
appraisal. In the absence of such determination or assessment, each party bears
its own expenses.
Any Former Stockholder who has duly demanded appraisal in compliance with
Section 262 of the GCL will not, after the Effective Date of the Merger, be
entitled to vote for any purpose the Shares subject to such demand or to receive
payment of dividends or other distributions on such Shares, except for dividends
or other distributions payable to stockholders of record at a date prior to the
Effective Date of the Merger.
At any time within 60 days after the Effective Date of the Merger, any
Former Stockholder shall have the right to withdraw its demand for appraisal and
to accept the per Share cash consideration pursuant to the Merger. After this
period, such holder may withdraw its demand for appraisal only with the consent
of Surviving QVC. If no petition for appraisal is filed with the Delaware Court
of Chancery within 120 days after the Effective Date of the Merger,
stockholders' rights to appraisal shall cease and all stockholders shall be
entitled to receive the per Share cash consideration pursuant to the Merger.
Inasmuch as QVC has no obligation to file such a petition, and the Parent
Purchasers have no present intention to cause or permit Surviving QVC to do so,
any stockholder who desires such a petition to be filed is advised to file it on
a timely basis. However, no petition timely filed in the Delaware Court of
Chancery demanding appraisal shall be dismissed as to any stockholder without
the approval of the Delaware Court of Chancery, and such approval may be
conditioned upon such terms as the Delaware Court of Chancery deems just.
Failure to take any required step in connection with the exercise of
appraisal rights may result in the termination or waiver of such rights.
THE FOREGOING IS A BRIEF SUMMARY OF SECTION 262 OF THE GCL WHICH SETS FORTH
THE PROCEDURES FOR DISSENTING FROM THE MERGER AND DEMANDING STATUTORY APPRAISAL
RIGHTS. THIS SUMMARY IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SECTION 262 OF
THE GCL, A COPY OF THE TEXT OF WHICH IS ATTACHED HERETO AS ANNEX III.
I-2
<PAGE> 6
ANNEX II
GENERAL CORPORATION LAW OF DELAWARE
SEC. 253 MERGER OF PARENT CORPORATION AND SUBSIDIARY OR SUBSIDIARIES
(a) In any case in which at least 90% of the outstanding shares of each
class of the stock of a corporation or corporations is owned by another
corporation and 1 of the corporations is a corporation of this State and the
other or others are corporations of this State, or any other state or states, or
the District of Columbia and the laws of other state or states, or the District
permit a corporation of such jurisdiction to merge with a corporation of another
jurisdiction, the corporation having such stock ownership may either merge the
other corporation or corporations into itself and assume all of its or their
obligations, or merge itself, or itself and 1 or more of such other
corporations, into 1 of the other corporations by executing, acknowledging and
filing, in accordance with sec. 103 of this title, a certificate of such
ownership and merger setting forth a copy of the resolution of its board of
directors to so merge and the date of the adoption; provided, however, that in
case the parent corporation shall not own all the outstanding stock of all the
subsidiary corporations, parties to a merger as aforesaid, the resolution of the
board of directors of the parent corporation shall state the terms and
conditions of the merger, including the securities, cash, property, or rights to
be issued, paid, delivered or granted by the surviving corporation upon
surrender of each share of the subsidiary corporation or corporations not owned
by the parent corporation. If the parent corporation be not the surviving
corporation, the resolution shall include provision for the pro rata issuance of
stock of the surviving corporation to the holders of the stock of the parent
corporation on surrender of any certificates therefor, and the certificate of
ownership and merger shall state that the proposed merger has been approved by a
majority of the outstanding stock of the parent corporation entitled to vote
thereon at a meeting duly called and held after 20 days' notice of the purpose
of the meeting mailed to each such stockholder at his address as it appears on
the records of the corporation if the parent corporation is a corporation of
this State or state that the proposed merger has been adopted, approved,
certified, executed and acknowledged by the parent corporation in accordance
with the laws under which it is organized if the parent corporation is not a
corporation of this State. A certified copy of the certificate shall be recorded
in the office of the recorder of the county in this State in which the
registered office of each constituent corporation which is a corporation of this
State is located. If the surviving corporation exists under the laws of the
District of Columbia or any state or jurisdiction other than this State,
subsection (d) of sec. 252 of this title shall also apply to a merger under this
section.
(b) If the surviving corporation is a Delaware corporation, it may change
its corporate name by the inclusion of a provision to that effect in the
resolution of merger adopted by the directors of the parent corporation and set
forth in the certificate of ownership and merger, and upon the effective date of
the merger, the name of the corporation shall be so changed.
(c) Subsection (d) of sec. 251 of this title shall apply to a merger under
this section, and subsection (e) of sec. 251 of this title shall apply to a
merger under this section in which the surviving corporation is the subsidiary
corporation and is a corporation of this State. References to "agreement of
merger" in subsections (d) and (e) of sec. 251 of this title shall mean for
purposes of this subsection the resolution of merger adopted by the board of
directors of the parent corporation. Any merger which effects any changes other
than those authorized by this section or made applicable by this subsection
shall be accomplished under sec. 251 or sec. 252 of this title. Section 262 of
this title shall not apply to any merger effected under this section, except as
provided in subsection (d) of this section.
(d) In the event all of the stock of a subsidiary Delaware corporation
party to a merger effected under this section is not owned by the parent
corporation immediately prior to the merger, the stockholders of the subsidiary
Delaware corporation party to the merger shall have appraisal rights as set
forth in sec. 262 of this title.
(e) A merger may be effected under this section although 1 or more of the
corporations parties to the merger is a corporation organized under the laws of
a jurisdiction other than 1 of the United States; provided that the laws of such
jurisdiction permit a corporation of such jurisdiction to merge with a
corporation of another jurisdiction.
II-1
<PAGE> 7
ANNEX III
GENERAL CORPORATION LAW OF DELAWARE
SEC. 262 APPRAISAL RIGHTS
(a) Any stockholder of a corporation of this State who holds shares of
stock on the date of the making of a demand pursuant to subsection (d) of this
section with respect to such shares, who continuously holds such shares through
the effective date of the merger or consolidation, who has otherwise complied
with subsection (d) of this section and who has neither voted in favor of the
merger or consolidation nor consented thereto in writing pursuant to sec. 228 of
this title shall be entitled to an appraisal by the Court of Chancery of the
fair value of his shares of stock under the circumstances described in
subsections (b) and (c) of this section. As used in this section, the word
"stockholder" means a holder of record of stock in a stock corporation and also
a member of record of a nonstock corporation; the words "stock" and "share" mean
and include what is ordinarily meant by those words and also membership or
membership interest of a member of a nonstock corporation; and the words
"depository receipt" mean a receipt or other instrument issued by a depository
representing an interest in one or more shares, or fractions thereof, solely of
stock of a corporation, which stock is deposited with the depository.
(b) Appraisal rights shall be available for the shares of any class or
series of stock of a constituent corporation in a merger or consolidation to be
effected pursuant to sec. 251, 252, 254, 257, 258, 263 or 264 of this title:
(1) Provided, however, that no appraisal rights under this section
shall be available for the shares of any class or series of stock, which
stock, or depository receipts in respect thereof, at the record date fixed
to determine the stockholders entitled to receive notice of and to vote at
the meeting of stockholders to act upon the agreement of merger or
consolidation, were either (i) listed on a national securities exchange or
designated as a national market system security on an interdealer quotation
system by the National Association of Securities Dealers, Inc. or (ii) held
of record by more than 2,000 holders; and further provided that no
appraisal rights shall be available for any shares of stock of the
constituent corporation surviving a merger if the merger did not require
for its approval the vote of the holders of the surviving corporation as
provided in subsection (f) of sec. 251 of this title.
(2) Notwithstanding paragraph (1) of this subsection, appraisal rights
under this section shall be available for the shares of any class or series
of stock of a constituent corporation if the holders thereof are required
by the terms of an agreement of merger or consolidation pursuant to
sec.sec. 251, 252, 254, 257, 258, 263 and 264 of this title to accept for
such stock anything except:
a. Shares of stock of the corporation surviving or resulting from
such merger or consolidation, or depository receipts in respect thereof;
b. Shares of stock of any other corporation, or depository receipts
in respect thereof, which shares of stock or depository receipts at the
effective date of the merger or consolidation will be either listed on a
national securities exchange or designated as a national market system
security on an interdealer quotation system by the National Association
of Securities Dealers, Inc. or held of record by more than 2,000
holders;
c. Cash in lieu of fractional shares or fractional depository
receipts described in the foregoing subparagraphs a. and b. of this
paragraph; or
d. Any combination of the shares of stock depository receipts and
cash in lieu of fractional shares or fractional depository receipts
described in the foregoing subparagraphs a., b. and c. of this
paragraph.
(3) In the event all of the stock of a subsidiary Delaware corporation
party to a merger effected under sec. 253 of this title is not owned by the
parent corporation immediately prior to the merger, appraisal rights shall
be available for the shares of the subsidiary Delaware corporation.
(c) Any corporation may provide in its certificate of incorporation that
appraisal rights under this section shall be available for the shares of any
class or series of its stock as a result of an amendment to its certificate of
incorporation, any merger or consolidation in which the corporation is a
constituent corporation or the sale of all or substantially all of the assets of
the corporation. If the certificate of incorporation contains such a provision,
the procedures of this section, including those set forth in subsections (d) and
(e) of this section, shall apply as nearly as is practicable.
III-1
<PAGE> 8
(d) Appraisal rights shall be perfected as follows:
(1) If a proposed merger or consolidation for which appraisal rights
are provided under this section is to be submitted for approval at a
meeting of stockholders, the corporation, not less than 20 days prior to
the meeting, shall notify each of its stockholders who was such on the
record date for such meeting with respect to shares for which appraisal
rights are available pursuant to subsections (b) or (c) hereof that
appraisal rights are available for any or all of the shares of the
constituent corporations, and shall include in such notice a copy of this
section. Each stockholder electing to demand the appraisal of his shares
shall deliver to the corporation, before the taking of the vote on the
merger or consolidation, a written demand for appraisal of his shares. Such
demand will be sufficient if it reasonably informs the corporation of the
identity of the stockholder and that the stockholder intends thereby to
demand the appraisal of his shares. A proxy or vote against the merger or
consolidation shall not constitute such a demand. A stockholder electing to
take such action must do so by a separate written demand as herein
provided. Within 10 days after the effective date of such merger or
consolidation, the surviving or resulting corporation shall notify each
stockholder of each constituent corporation who has complied with this
subsection and has not voted in favor of or consented to the merger or
consolidation of the date that the merger or consolidation has become
effective; or
(2) If the merger or consolidation was approved pursuant to sec. 228
or 253 of this title, the surviving or resulting corporation, either before
the effective date of the merger or consolidation or within 10 days
thereafter, shall notify each of the stockholders entitled to appraisal
rights of the effective date of the merger or consolidation and that
appraisal rights are available for any or all of the shares of the
constituent corporation, and shall include in such notice a copy of this
section. The notice shall be sent by certified or registered mail, return
receipt requested, addressed to the stockholder at his address as it
appears on the records of the corporation. Any stockholder entitled to
appraisal rights may, within 20 days after the date of mailing of the
notice, demand in writing from the surviving or resulting corporation the
appraisal of his shares. Such demand will be sufficient if it reasonably
informs the corporation of the identity of the stockholder and that the
stockholder intends thereby to demand the appraisal of his shares.
(e) Within 120 days after the effective date of the merger or
consolidation, the surviving or resulting corporation or any stockholder who has
complied with subsections (a) and (d) hereof and who is otherwise entitled to
appraisal rights, may file a petition in the Court of Chancery demanding a
determination of the value of the stock of all such stockholders.
Notwithstanding the foregoing, at any time within 60 days after the effective
date of the merger or consolidation, any stockholder shall have the right to
withdraw his demand for appraisal and to accept the terms offered upon the
merger or consolidation. Within 120 days after the effective date of the merger
or consolidation, any stockholder who has complied with the requirements of
subsections (a) and (d) hereof, upon written request, shall be entitled to
receive from the corporation surviving the merger or resulting from the
consolidation a statement setting forth the aggregate number of shares not voted
in favor of the merger or consolidation and with respect to which demands for
appraisal have been received and the aggregate number of holders of such shares.
Such written statement shall be mailed to the stockholder within 10 days after
his written request for such a statement is received by the surviving or
resulting corporation or within 10 days after expiration of the period for
delivery of demands for appraisal under subsection (d) hereof, whichever is
later.
(f) Upon the filing of any such petition by a stockholder, service of a
copy thereof shall be made upon the surviving or resulting corporation, which
shall within 20 days after such service file in the office of the Register in
Chancery in which the petition was filed a duly verified list containing the
names and addresses of all stockholders who have demanded payment for their
shares and with whom agreements as to the value of their shares have not been
reached by the surviving or resulting corporation. If the petition shall be
filed by the surviving or resulting corporation, the petition shall be
accompanied by such a duly verified list. The Register in Chancery, if so
ordered by the Court, shall give notice of the time and place fixed for the
hearing of such petition by registered or certified mail to the surviving or
resulting corporation and to the stockholders shown on the list at the addresses
therein stated. Such notice shall also be given by 1 or more publications at
least 1 week before the day of the hearing, in a newspaper of general
circulation published in the City of Wilmington, Delaware or such publication as
the Court deems advisable. The forms of the notices by mail and by publication
shall be approved by the Court, and the costs thereof shall be borne by the
surviving or resulting corporation.
(g) At the hearing on such petition, the Court shall determine the
stockholders who have complied with this section and who have become entitled to
appraisal rights. The Court may require the stockholders who have demanded an
appraisal for their shares and who hold stock represented by certificates to
submit their certificates of stock to the Register
III-2
<PAGE> 9
in Chancery for notation thereon of the pendency of the appraisal proceedings;
and if any stockholder fails to comply with such direction, the Court may
dismiss the proceedings as to such stockholder.
(h) After determining the stockholders entitled to an appraisal, the Court
shall appraise the shares, determining their fair value exclusive of any element
of value arising from the accomplishment or expectation of the merger or
consolidation, together with a fair rate of interest, if any, to be paid upon
the amount determined to be the fair value. In determining such fair value, the
Court shall take into account all relevant factors. In determining the fair rate
of interest, the Court may consider all relevant factors, including the rate of
interest which the surviving or resulting corporation would have had to pay to
borrow money during the pendency of the proceeding. Upon application by the
surviving or resulting corporation or by any stockholder entitled to participate
in the appraisal proceeding, the Court may, in its discretion, permit discovery
or other pretrial proceedings and may proceed to trial upon the appraisal prior
to the final determination of the stockholder entitled to an appraisal. Any
stockholder whose name appears on the list filed by the surviving or resulting
corporation pursuant to subsection (f) of this section and who has submitted his
certificates of stock to the Register in Chancery, if such is required, may
participate fully in all proceedings until it is finally determined that he is
not entitled to appraisal rights under this section.
(i) The Court shall direct the payment of the fair value of the shares,
together with interest, if any, by the surviving or resulting corporation to the
stockholders entitled thereto. Interest may be simple or compound, as the Court
may direct. Payment shall be so made to each such stockholder, in the case of
holders of uncertificated stock forthwith, and the case of holders of shares
represented by certificates upon the surrender to the corporation of the
certificates representing such stock. The Court's decree may be enforced as
other decrees in the Court of Chancery may be enforced, whether such surviving
or resulting corporation be a corporation of this State or of any state.
(j) The costs of the proceeding may be determined by the Court and taxed
upon the parties as the Court deems equitable in the circumstances. Upon
application of a stockholder, the Court may order all or a portion of the
expenses incurred by any stockholder in connection with the appraisal
proceeding, including, without limitation, reasonable attorney's fees and the
fees and expenses of experts, to be charged pro rata against the value of all
the shares entitled to an appraisal.
(k) From and after the effective date of the merger or consolidation, no
stockholder who has demanded his appraisal rights as provided in subsection (d)
of this section shall be entitled to vote such stock for any purpose or to
receive payment of dividends or other distributions on the stock (except
dividends or other distributions payable to stockholders of record at a date
which is prior to the effective date of the merger or consolidation); provided,
however, that if no petition for an appraisal shall be filed within the time
provided in subsection (e) of this section, or if such stockholder shall deliver
to the surviving or resulting corporation a written withdrawal of his demand for
an appraisal and an acceptance of the merger or consolidation, either within 60
days after the effective date of the merger or consolidation as provided in
subsection (e) of this section or thereafter with the written approval of the
corporation, then the right of such stockholder to an appraisal shall cease.
Notwithstanding the foregoing, no appraisal proceeding in the Court of Chancery
shall be dismissed as to any stockholder without the approval of the Court, and
such approval may be conditioned upon such terms as the Court deems just.
(l) The shares of the surviving or resulting corporation to which the
shares of such objecting stockholders would have been converted had they
assented to the merger or consolidation shall have the status of authorized and
unissued shares of the surviving or resulting corporation.
III-3
<PAGE> 1
LETTER OF TRANSMITTAL
TO ACCOMPANY CERTIFICATES WHICH REPRESENTED SHARES
OF
COMMON STOCK,
SERIES B PREFERRED STOCK
AND
SERIES C PREFERRED STOCK
OF
QVC, INC.
SURRENDERED IN EXCHANGE FOR CASH
To: The Bank of New York, EXCHANGE AGENT
<TABLE>
<S> <C>
By Mail: By Hand or Overnight Courier:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, NY 10286-1248 New York, NY 10286
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED
In connection with the merger (the "Merger") of QVC Programming Holdings,
Inc. (the "Purchaser"), a Delaware corporation jointly-owned by Comcast
Corporation ("Comcast"), a Pennsylvania corporation (57.4%), and Liberty Media
Corporation ("Liberty" and, together with Comcast, the "Parent Purchasers"), a
Delaware corporation (42.6%) and a wholly-owned subsidiary of
Tele-Communications, Inc. ("TCI"), a Delaware corporation, with and into QVC,
Inc. ("QVC" and, following the Merger, "Surviving QVC"), a Delaware corporation,
pursuant to the terms of the Agreement and Plan of Merger, dated as of August 4,
1994, among the Parent Purchasers, TCI Cable Investments, Inc. (f/k/a/ Liberty
Media Corporation), the Purchaser and QVC (as amended by the First Amendment to
Agreement and Plan of Merger, dated as of February 3, 1995, the "Merger
Agreement"), which occurred on February 15, 1995 (the "Effective Time"), I
hereby surrender the following certificate(s) which represented shares of Common
Stock (the "Common Stock"), par value $.01 per share, of the Company, Series B
Preferred Stock (the "Series B Preferred Stock") or Series C Preferred Stock
(the "Series C Preferred Stock" and, together with the Series B Preferred Stock,
the "Preferred Stock" and, together with the Series B Preferred Stock and the
Common Stock, the "Shares"), each par value $.10 per share, of the Company, in
exchange for $46.00 per share of Common Stock (the "Common Stock Cash
Consideration") or $460.00 per share of Preferred Stock (the "Preferred Stock
Cash Consideration"), as the case may be. The Common Stock Cash Consideration
and the Preferred Stock Cash Consideration may hereinafter be collectively
referred to as the "Cash Consideration".
1
<PAGE> 2
- --------------------------------------------------------------------------------
DESCRIPTION OF ENCLOSED CERTIFICATES
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES)
OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK,
EXACTLY AS NAME(S) APPEAR(S)
ON SHARE CERTIFICATE(S))
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
- --------------------------------------------------------------------------------------------------------
SHARE CERTIFICATE(S) ENCLOSED
(ATTACH ADDITIONAL LIST IF NECESSARY)
- --------------------------------------------------------------------------------------------------------
CLASS AND SERIES TOTAL NUMBER
SHARE OF SHARES OF SHARES
CERTIFICATE REPRESENTED BY REPRESENTED BY
NUMBER(S) SHARE CERTIFICATE(S) SHARE CERTIFICATE(S)
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
TOTAL SHARES OF COMMON STOCK......
----------------------------------
TOTAL SHARES OF SERIES B PREFERRED
STOCK.............................
----------------------------------
TOTAL SHARES OF SERIES C PREFERRED
STOCK.............................
- --------------------------------------------------------------------------------------------------------
</TABLE>
Please issue, subject to the terms and conditions provided herein, upon
surrender of certificates which represented Shares of Common Stock or Preferred
Stock, a check for the aggregate Common Stock Cash Consideration and/or
Preferred Stock Cash Consideration to which I am entitled, in the name and to
the address indicated above unless I have provided other instructions under
"Special Issuance Instructions" or "Special Delivery Instructions" below.
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, personal representatives, successors
and assigns of the undersigned.
LOST CERTIFICATES
/ / I have lost my certificate(s) that represented shares of
Common Stock, shares of Series B Preferred Stock and
shares of Series C Preferred Stock and require assistance in
obtaining replacement certificate(s). I understand that I must contact
the Exchange Agent to obtain instructions for replacing lost
certificates. (See Instruction 7.)
2
<PAGE> 3
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 5)
To be completed ONLY if the check is to be issued in the name of someone
other than the undersigned.
Issue check to:
Name............................................................................
(Please Print)
...............................................................................
Address.........................................................................
...............................................................................
(Zip Code)
...............................................................................
(Taxpayer Identification No.)
(Note: if this box is completed, endorsement on surrendered certificate(s) or
signature(s) on the accompanying instrument of transfer MUST BE GUARANTEED in
the usual form by a bank or an eligible guarantor institution (see Instruction
4). PLEASE ALSO COMPLETE THE SUBSTITUTE FORM W-9 BELOW.)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 5)
To be completed ONLY if the check is to be mailed to someone other than the
registered owner(s) or to an address other than the address of record indicated
on this form (see Instruction 4).
Mail check to:
Name............................................................................
(Please Print)
...............................................................................
Address.........................................................................
...............................................................................
(Zip Code)
3
<PAGE> 4
<TABLE>
<C> <S> <C>
SIGN HERE
(ALSO COMPLETE SUBSTITUTE FORM W-9 BELOW)
ALL HOLDERS OF COMMON STOCK MUST SIGN BELOW
IMPORTANT -- Please endorse certificates ONLY if the check is to be issued in a different name, as
provided by Instructions 4 and 5 herein. Sign in the space below in either case. If this Letter
of Transmittal is signed by someone other than the registered holder appearing on the surrendered
stock certificates, such signature must be guaranteed. See Instruction 4. The undersigned
represents that he or she has read and agrees to all the terms and conditions set forth herein.
............................................................................
............................................................................
Signature(s) of Owner(s)
Name(s) ....................................................................
(Please Print)
............................................................................
Capacity (full title) ......................................................
Address ....................................................................
............................................................................
............................................................................
(Include Zip Code)
Daytime Area Code and Telephone Number .....................................
Dated ................................................................. 1995
</TABLE>
(Must be signed by registered holder(s) exactly as name(s) appear(s) on stock
certificate(s). If a signature is by a trustee, executor, or other person acting
in a fiduciary or representative capacity, please set forth full title and see
Instruction 4.)
4
<PAGE> 5
PAYER'S NAME: THE BANK OF NEW YORK
<TABLE>
<S> <C> <C>
- --------------------------------------------------------------------------------
SUBSTITUTE PART I -- PLEASE PROVIDE YOUR ----------------------------------
FORM W-9 TIN IN THE BOX AT THE RIGHT AND Social Security Number
DEPARTMENT OF THE CERTIFY BY SIGNING AND DATING or
TREASURY INTERNAL BELOW. ----------------------------------
REVENUE SERVICE Employer Identification Number
PAYER'S REQUEST FOR
TAXPAYER IDENTIFICATION
NUMBER (TIN)
</TABLE>
- --------------------------------------------------------------------------------
PART II
- --------------------------------------------------------------------------------
CERTIFICATION. Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct taxpayer identification number
(or I am waiting for a number to be issued to me);
(2) I am not subject to backup withholding either because (a) I am exempt from
backup withholding, or (b) I have not been notified by the Internal
Revenue Service ("IRS") that I am subject to backup withholding as a
result of a failure to report all interest or dividends, or (c) the IRS
has notified me that I am no longer subject to backup withholding.
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you
have been notified by the IRS that you are currently subject to backup
withholding because of underreporting interest or dividends on your tax
return. However, if after being notified by the IRS that you were subject
to backup withholding you received another notification from the IRS that
you are no longer subject to backup withholding, do not cross out such
item (2).
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
SIGNATURE DATE , PART III
1995 Awaiting TIN / /
</TABLE>
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF
SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and either (1) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office
or (2) I intend to mail or deliver an application in the near future. I
understand that if I do not provide a taxpayer identification number by
the time of payment, 31% of all reportable payments made to me will be
withheld, but that such amounts will be refunded to me if I then provide a
Taxpayer Identification Number within sixty (60) days.
Signature Date , 1995
5
<PAGE> 6
INSTRUCTIONS
FOR SURRENDERING CERTIFICATES WHICH REPRESENTED SHARES OF COMMON STOCK
OR PREFERRED STOCK IN EXCHANGE FOR CASH
1. EXECUTION AND DELIVERY
To receive the Cash Consideration, this Letter of Transmittal or a
facsimile hereof must be properly completed, dated, and signed, and must be
received together with your certificate(s) that represented Shares by the
Exchange Agent at either of the addresses set forth on the front cover of the
Letter of Transmittal. Delivery of this Letter of Transmittal to an address
other than as set forth on the face hereof will not constitute a valid delivery.
The method of delivery to the Exchange Agent is at your option and risk; if sent
by mail, certified mail is suggested. A pre-addressed envelope is enclosed for
your convenience.
THE CHECK FOR ANY CASH PAYMENT TO WHICH A HOLDER MAY BE ENTITLED WILL BE
MAILED AS SOON AS PRACTICABLE FOLLOWING THE PROCESSING BY THE EXCHANGE AGENT OF
THE PROPERLY COMPLETED LETTER OF TRANSMITTAL PURSUANT TO AND IN ACCORDANCE WITH
THE PROVISIONS OF THIS LETTER OF TRANSMITTAL. IF SPECIAL ISSUANCE INSTRUCTIONS
ARE PROVIDED IN THIS LETTER OF TRANSMITTAL, OR IF THESE INSTRUCTIONS ARE NOT
PROPERLY FOLLOWED, THE MAILING OF THE CHECK AND ANY SHARE CERTIFICATES MAY BE
DELAYED.
2. INADEQUATE SPACE
If there is insufficient space on this Letter of Transmittal to list all
your share certificates being submitted to the Exchange Agent, please attach a
separate list.
3. SIGNATURES
THE SIGNATURE (OR SIGNATURES, IN THE CASE OF CERTIFICATES OWNED BY TWO OR
MORE JOINT HOLDERS) ON THIS LETTER OF TRANSMITTAL SHOULD CORRESPOND EXACTLY WITH
THE NAME AS WRITTEN ON THE FACE OF THE SHARE CERTIFICATE(S) TRANSMITTED UNLESS
THE SHARES DESCRIBED ON THIS LETTER OF TRANSMITTAL HAVE BEEN ASSIGNED BY THE
REGISTERED HOLDER OR HOLDERS. IN THAT CASE, THIS LETTER OF TRANSMITTAL SHOULD BE
SIGNED IN EXACTLY THE SAME FORM AS THE NAME OF THE LAST TRANSFEREE INDICATED ON
THE TRANSFERS ATTACHED TO OR ENDORSED ON THE CERTIFICATE(S).
If this Letter of Transmittal is signed by a trustee, executor,
administrator, guardian, officer of a corporation, or attorney-in-fact, or by a
person acting in any other representative or fiduciary capacity, the person
signing must give his or her full title, and appropriate evidence of authority
to act in such capacity must be forwarded with this Letter of Transmittal. If
additional documents are required by the Exchange Agent, you will be so advised.
If this Letter of Transmittal is signed on behalf of a partnership, each general
partner must sign this Letter of Transmittal and include each partner's name,
address and telephone number.
If any stockholder's shares are registered in different ways on different
stock certificates, it will be necessary for the stockholder to complete, sign,
and submit as many separate Letters of Transmittal as there are different
registrations, or the stockholder may provide only one Letter of Transmittal and
sign it each way his or her name appears on different stock certificates.
However, each signature must be guaranteed as described in Instruction 4.
4. SPECIAL ISSUANCE INSTRUCTIONS AND SPECIAL DELIVERY INSTRUCTIONS
A holder of a certificate(s) that represented Shares should indicate in the
applicable space provided the name and address to which a check is to be sent,
if different from the name and address of the person signing this Letter of
Transmittal. In the case of issuance to a person other than the registered
holder appearing on the surrendered stock certificates, the Tax Identification
or Social Security Number of that person named must also be indicated.
If this Letter of Transmittal is signed by someone other than the
registered holder appearing on the surrendered share certificate(s), or if this
registered holder signs this Letter of Transmittal but requests that a check be
issued to someone other than the registered holder, then (i) the surrendered
certificate(s) that represented Shares must be endorsed on the reverse thereof
or accompanied by separate stock powers for each registration and must be signed
by the registered holder and (ii) the person submitting this Letter of
Transmittal shall pay to the Exchange Agent any transfer or other taxes
6
<PAGE> 7
required as a result of the requested issuance or establish to the satisfaction
of the Exchange Agent that such tax either has been paid or is not payable. The
signature must be medallion guaranteed by an eligible guarantor institution.
Generally an eligible guarantor institution, as defined in Rule 17Ad-15 of the
regulations of the Securities and Exchange Commission under the Securities
Exchange Act of 1934, means: (i) banks (as that term is defined in Section 3(a)
of the Federal Deposit Insurance Act); (ii) brokers, dealers, municipal
securities dealers, municipal securities brokers, government securities dealers,
and government securities brokers (as those terms are defined under the
Securities Exchange Act of 1934); (iii) credit unions (as that term is defined
in Section 19(b)(1)(A) of the Federal Reserve Act); (iv) national securities
exchanges, registered securities associates, clearing agencies (as those terms
are used under the Securities Exchange Act of 1934); and (v) savings
associations (as that term is defined in Section 3(b) of the Federal Deposit
Insurance Act). In that case, the signature on this Letter of Transmittal must
correspond exactly with the name of the person to whom the check is to be
issued, as shown on the assignment from the registered holder of certificate(s)
that represented Shares.
5. CORRECTION OR CHANGE OF NAME OR ADDRESS
For correction of name or for a change in name that does not involve a
change of ownership, proceed as described in this Instruction 5. For a change in
name by marriage or comparable change, the surrendered stock certificate should
be endorsed, e.g. "Mary Doe, now by marriage Mary Smith," with the signature
guaranteed as described in Instruction 4 above. For a correction in name, the
surrendered certificate should be endorsed, e.g. "James E. Jones, incorrectly
inscribed J.B. Jones," with the signature guaranteed as described in Instruction
4 above. A correction of or change in address of the registered holder should be
indicated by crossing out the address shown on the label and writing in the new
or correct address.
6. SUBSTITUTE FORM W-9
Under the federal income tax laws, the Exchange Agent will be required to
withhold 31% of the amount of any reportable payments made to certain holders of
certificates that represented Shares. In order to avoid backup withholding, each
surrendering stockholder and, if applicable, each other payee must provide the
Exchange Agent with such stockholder's or payee's correct Taxpayer
Identification Number (TIN) and certify that such stockholder or payee is not
subject to such backup withholding by completing the Substitute Form W-9 set
forth above. In general, if a stockholder or payee is an individual, the TIN is
the Social Security Number of such individual. If the Exchange Agent is not
provided with the correct TIN, the stockholder or payee may be subject to a $50
penalty imposed by the Internal Revenue Service. Certain stockholders or payees
(including, among others, all corporations and certain foreign individuals) are
not subject to these backup withholding and reporting requirements. In order to
satisfy the Exchange Agent that a foreign individual qualifies as an exempt
recipient, the stockholder or payee must submit a statement, signed under
penalties of perjury, attesting to that individual's exempt status. Forms of
such statements can be obtained from the Exchange Agent. FOR FURTHER INFORMATION
CONCERNING BACKUP WITHHOLDING AND INSTRUCTIONS FOR COMPLETING THE SUBSTITUTE
FORM W-9 (INCLUDING HOW TO OBTAIN A TIN IF YOU DO NOT HAVE ONE AND HOW TO
COMPLETE THE SUBSTITUTE FORM W-9 IF SHARES WERE HELD IN MORE THAN ONE NAME),
CONSULT THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9.
Failure to complete the Substitute Form W-9 will not, by itself, cause a
stockholder's Shares to be deemed invalidly surrendered, but may require the
Exchange Agent to withhold 31% of cash proceeds with respect to the surrender of
Shares. Backup withholding is not an additional federal income tax. Rather, the
federal income tax liability of a person subject to backup withholding will be
reduced by the amount of tax withheld. If withholding results in an overpayment
of taxes, a refund may be obtained provided that the required information is
furnished to the Internal Revenue Service.
7. MUTILATED, LOST, STOLEN OR DESTROYED CERTIFICATES
Any holder of a certificate(s) that represented Shares whose certificate(s)
has been mutilated, lost, stolen, or destroyed should (i) complete this Letter
of Transmittal and check the appropriate box above and (ii) contact the Exchange
Agent immediately. The Exchange Agent will provide such holder with all
necessary forms and instructions to replace any mutilated, lost, stolen or
destroyed certificates. The holder may also be required to give the Company a
bond as indemnity against any claim that may be made against it with respect to
the certificate(s) alleged to have been mutilated, lost, stolen, or destroyed.
7
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8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES
Questions relating to the exchange, as well as requests for assistance or
for additional copies of this Letter of Transmittal may be directed to the
Exchange Agent at the address set forth on the front cover of the Letter of
Transmittal, by telephone at (800) 507-9357 or by facsimile at (212) 815-6213.
9. TERMINATION OF APPOINTMENT OF EXCHANGE AGENT
Following the termination of the appointment of the Exchange Agent, holders
of certificates that represented Shares should contact: Secretary, QVC, Inc.,
1365 Enterprise Drive, West Chester, PA 19380.
10. CERTIFICATES NOT SURRENDERED
None of the Purchaser, the Parent Purchasers, TCI, QVC or Surviving QVC
corporation in the Merger will be liable to any holder for any amount paid to a
public official pursuant to applicable abandoned property laws. Six months after
the Effective Time, cash made available to the Exchange Agent shall be returned
to Surviving QVC upon its request, and thereafter holders of certificates that
represented Shares shall look only to Surviving QVC for cash to which they are
entitled.
8
<PAGE> 1
_________________________________________________________________
$1,200,000,000
CREDIT AGREEMENT
Dated as of February 15, 1995
Among
QVC PROGRAMMING HOLDINGS, INC.
THE BANKS LISTED ON THE
SIGNATURE PAGES HEREOF,
THE BANK OF NEW YORK COMPANY, INC.,
BARCLAYS BANK PLC,
CHEMICAL BANK,
NATIONSBANK, N.A. (CAROLINAS)
AND
THE TORONTO-DOMINION BANK
as Managing Agents
and
THE BANK OF NEW YORK,
as Administrative Agent
_________________________________________________________________
<PAGE> 2
SCHEDULES AND EXHIBITS
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Annex A - Banks, Lending Offices and Notice Addresses
Schedule 1.02 - Form of Notice of Borrowing or Issuance of Letter of Credit
Schedule 1.04(c)(iv) - Form of Notice of Conversion or Continuation
Schedule 1.06 - Form of Notice of Prepayment
Schedule 2.01(a) - Form of Certificate as to Resolutions, etc.
Schedule 2.01(d)-1 - Form of Opinion of Counsel for Borrower and Subsidiaries
Schedule 2.01(d)-2 - Form of Opinion of Counsel for Each Transaction Party other than Borrower
Schedule 2.01(e) - Form of Opinion of Special Counsel for Administrative Agent
Schedule 2.01(l) - Form of Certificate as to Solvency and Adequacy of Capital, etc.
Schedule 3.02 - Capitalization and Subsidiaries
Schedule 3.03 - Required Consents and Governmental Approvals
Schedule 3.04 - Material Litigation
Schedule 3.13 - Existing Benefit Plans
Schedule 4.04 - Existing Guaranties
Schedule 4.05 - Existing Liens
Schedule 4.12 - Permitted Restrictive Covenants
Schedule 4.14 - Existing Investments
Schedule 4.22 - Material Subsidiaries
Schedule 5.01(a) - Form of Certificate as to Quarterly Financial Statements
Schedule 5.01(b) - Form of Certificate as to Year-End Financial Statements
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Schedule 5.02(a) - Historical Financial Statements
Schedule 9.10(a) - Form of Notice of Assignment
Exhibit A-1 - Form of Term A Note
Exhibit A-2 - Form of Term B Note
Exhibit A-3 - Form of RC Note
Exhibit A-4 - Form of Working Capital Note
Exhibit A-5 - Form of Swing Note
Exhibit B - Assumption Agreement
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TABLE OF CONTENTS
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ARTICLE 1
CREDIT FACILITY
Section 1.01. Commitment to Lend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
(a) Term Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
(b) RC Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
(c) Working Capital Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
(d) Swing Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
(e) Type of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.02. Manner of Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.03. Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 1.04. Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(a) Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(b) Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(c) Conversion and Continuation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(d) Maximum Interest Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 1.05. Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(a) Term A Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(b) Term B Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(c) RC Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
(d) Working Capital Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
(e) Drawings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
(f) Swing Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 1.06. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
(a) Optional Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
(b) Mandatory Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 1.07. Limitation on Types of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 1.08. Reductions of Total RC Commitment and Total Working Capital Commitment . . . . . . . . . . . . . . . 16
(a) Scheduled Reductions of Total RC Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
(b) Optional Reductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
(c) Mandatory Reductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(d) Adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(e) No Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 1.09. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(a) Commitment Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(b) Letter of Credit Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 1.10. Computation of Interest and Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 1.11. Payments by the Borrower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(a) Time, Place and Manner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(b) No Reductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
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(c) Authorization to Charge Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(d) Extension of Payment Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 1.12. Distribution of Payments by the Administrative Agent . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 1.13. Taxes on Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(a) Taxes Payable by the Borrower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(b) Taxes Payable by the Issuing Bank, any Bank or Agent . . . . . . . . . . . . . . . . . . . . . . . . . 21
(c) Credits and Deductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(d) Exemption from U.S. Withholding Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 1.14. Evidence of Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 1.15. Pro Rata Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE 2
CONDITIONS TO LOANS AND LETTERS OF CREDIT
Section 2.01. Conditions to Initial Loans or Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 2.02. Conditions to Each Loan and Letter of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE 3
CERTAIN REPRESENTATIONS AND WARRANTIES
Section 3.01. Organization; Power; Qualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 3.02. Capitalization; Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 3.03. Authorization; Enforceability; Required Consents; Absence of Conflicts . . . . . . . . . . . . . . . . 30
Section 3.04. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 3.05. Burdensome Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 3.06. No Adverse Change or Event . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 3.07. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 3.08. No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 3.09. Not an Investment Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 3.10. Hazardous Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 3.11. Solvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 3.12. Senior Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 3.13. Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 3.14. Security Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE 4
CERTAIN COVENANTS
Section 4.01. Preservation of Existence and Properties, Scope of Business, Compliance with Law, Payment of Taxes
and Claims, Preservation of Enforceability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 4.02. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 4.03. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
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Section 4.04. Guaranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 4.05. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 4.06. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 4.07. Merger or Consolidation; Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 4.08. Disposition of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 4.09. Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 4.10. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 4.11. Management Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 4.12. Limitation on Restrictive Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 4.13. Issuance or Disposition of Capital Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 4.14. Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 4.15. Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 4.16. Fixed Charge Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.17. Interest Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.18. Pro Forma Debt Service Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.19. Interest Rate Protection Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.20. Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.21. Carriage and Related Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.22. Material Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 4.23. Taxes of Other Persons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE 5
FINANCIAL STATEMENTS AND INFORMATION
Section 5.01. Financial Statements and Information to Be Furnished . . . . . . . . . . . . . . . . . . . . . . . . . 43
(a) Quarterly Financial Statements; Officer's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . 44
(b) Year End Financial Statements; Accountants' and Officer's Certificates . . . . . . . . . . . . . . . . 44
(c) Reports and Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
(d) Requested Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
(e) Notice of Events of Defaults and Other Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 5.02. Accuracy of Financial Statements and Information . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
(a) Historical Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
(b) Future Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
(c) Historical Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
(d) Future Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 5.03. Additional Covenants Relating to Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(a) Accounting Methods and Financial Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
(b) Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
(c) Visits, Inspections and Discussions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 5.04. Authorization of Third Parties to Deliver Information . . . . . . . . . . . . . . . . . . . . . . . . . 48
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ARTICLE 6
DEFAULT
Section 6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 6.02. Remedies upon Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 6.03. Certain Cure Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
ARTICLE 7
ADDITIONAL CREDIT FACILITY PROVISIONS
Section 7.01. Mandatory Suspension and Conversion of Eurodollar Rate Loans . . . . . . . . . . . . . . . . . . . . . 55
Section 7.02. Regulatory Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 7.03. Capital and Reserve Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 7.04. Funding Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 7.05. Determinations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 7.06. Change of Lending Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Section 7.07. Replacement of Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
ARTICLE 8
THE AGENTS
Section 8.01. Appointment and Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 8.02. Limitation on Agents' Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 8.03. Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 8.04. Rights as a Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 8.05. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 8.06. Non Reliance on Agents and Other Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 8.07. Resignation of the Administrative Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
ARTICLE 9
MISCELLANEOUS
Section 9.01. Notices and Deliveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
(a) Manner of Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
(b) Addresses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
(c) Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 9.02. Expenses; Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 9.03. Amounts Payable Due upon Request for Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 9.04. Remedies of the Essence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 9.05. Rights Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 9.06. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 9.07. Amendments; Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 9.08. Set Off; Suspension of Payment and Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 9.09. Sharing of Recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 9.10. Assignments and Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
(a) Assignments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
(b) Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
</TABLE>
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<PAGE> 8
<TABLE>
<S> <C>
(c) Rights of Assignees and Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 9.11. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 9.12. Judicial Proceedings; Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 9.13. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 9.14. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.15. Survival of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.16. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.17. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.18. Reference Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.19. Cash Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
ARTICLE 10
INTERPRETATION
Section 10.01. Definitional Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
(a) Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
(b) Other Definitional Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Section 10.02. Accounting Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
Section 10.03. Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
Section 10.04. Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
</TABLE>
SCHEDULES AND EXHIBITS
<TABLE>
<S> <C> <C>
Annex A - Banks, Lending Offices and Notice Addresses
Schedule 1.02 - Form of Notice of Borrowing or Issuance of Letter of Credit
Schedule 1.04(c)(iv) - Form of Notice of Conversion or Continuation
Schedule 1.06 - Form of Notice of Prepayment
Schedule 2.01(a) - Form of Certificate as to Resolutions, etc.
Schedule 2.01(d)-1 - Form of Opinion of Counsel for Borrower and Subsidiaries
Schedule 2.01(d)-2 - Form of Opinion of Counsel for Each Transaction Party other than Borrower
Schedule 2.01(e) - Form of Opinion of Special Counsel for Administrative Agent
Schedule 2.01(l) - Form of Certificate as to Solvency and Adequacy of Capital, etc.
</TABLE>
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<PAGE> 9
<TABLE>
<S> <C> <C>
Schedule 3.02 - Capitalization and Subsidiaries
Schedule 3.03 - Required Consents and Governmental Approvals
Schedule 3.04 - Material Litigation
Schedule 3.13 - Existing Benefit Plans
Schedule 4.04 - Existing Guaranties
Schedule 4.05 - Existing Liens
Schedule 4.12 - Permitted Restrictive Covenants
Schedule 4.14 - Existing Investments
Schedule 4.22 - Material Subsidiaries
Schedule 5.01(a) - Form of Certificate as to Quarterly Financial Statements
Schedule 5.01(b) - Form of Certificate as to Year-End Financial Statements
Schedule 5.02(a) - Historical Financial Statements
Schedule 9.10(a) - Form of Notice of Assignment
Exhibit A-1 - Form of Term A Note
Exhibit A-2 - Form of Term B Note
Exhibit A-3 - Form of RC Note
Exhibit A-4 - Form of Working Capital Note
Exhibit A-5 - Form of Swing Note
Exhibit B - Assumption Agreement
</TABLE>
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<PAGE> 10
CREDIT AGREEMENT
Dated as of February 15, 1995
QVC PROGRAMMING HOLDINGS, INC., a Delaware corporation, the
BANKS listed on the signature pages hereof, THE BANK OF NEW YORK COMPANY, INC.,
BARCLAYS BANK PLC, CHEMICAL BANK, NATIONSBANK, N.A. (CAROLINAS) and THE
TORONTO-DOMINION BANK, as Managing Agents, and THE BANK OF NEW YORK, as
Administrative Agent, agree as follows (with certain terms used herein being
defined in Article 10):
ARTICLE 1
CREDIT FACILITY
Section 1.01. Commitment to Lend. (a) Term Loans. (i)
Term A Loans. Upon the terms and subject to the conditions of this Agreement,
each Term A Bank agrees to make, on the Merger Date, a Term A Loan to the
Borrower in the amount of such Bank's Term A Commitment. The Total Term A
Commitment on the Agreement Date is $600,000,000.
(ii) Term B Loans. Upon the terms and subject to the
conditions of this Agreement, each Term B Bank agrees to make, on the Merger
Date, a Term B Loan to the Borrower in the amount of such Bank's Term B
Commitment. The Total Term B Commitment on the Agreement Date is $200,000,000.
(b) RC Loans. Upon the terms and subject to the conditions
of this Agreement, each RC Bank agrees to make, from time to time during the
period from and including the Merger Date to but excluding the RC Maturity
Date, one or more RC Loans to the Borrower in an aggregate unpaid principal
amount not exceeding at any time such Bank's RC Commitment at such time. The
Total RC Commitment on the Agreement Date is $325,000,000.
(c) Working Capital Loans. Upon the terms and subject to the
conditions of this Agreement, each Working Capital Bank agrees to make, from
time to time during the period from and including the Merger Date to but
excluding the Working Capital Maturity Date, one or more Working Capital Loans
to the Borrower in an aggregate unpaid principal amount not exceeding at any
time such Bank's Working Capital Commitment at such time minus the sum of (i)
the aggregate amount of such Bank's Letter of Credit Participations at such
time and (ii) such Bank's Swing Loan Percentage of the aggregate principal
amount of the Swing Loans outstanding at such time. The Total Working Capital
Commitment on the Agreement Date is $75,000,000.
<PAGE> 11
(d) Swing Loans. (i) Upon the terms and subject to the
conditions of this Agreement, the Swing Loan Lender agrees to make, from time
to time from and including the Merger Date to but excluding the Working Capital
Maturity Date, make one or more Swing Loans to the Borrower, in an aggregate
unpaid principal amount not exceeding at any time the lesser of (A) the Total
Working Capital Commitment at such time minus the sum of the aggregate
principal amount of all Working Capital Loans outstanding at such time and the
aggregate amount of the Letter of Credit Participations outstanding at such
time and (B) $25,000,000. All Swing Loans shall be in an amount not less than
$1,000,000 and shall be in an integral multiple of $1,000,000 and shall be made
and maintained as Base Rate Loans. All Swing Loans shall be disbursed by the
Swing Loan Lender in Dollars in funds immediately available to the Borrower by
credit to an account of the Borrower at the Swing Loan Lender's Domestic
Lending Office, or in such other manner as may have been specified in the
applicable notice of borrowing and as shall be acceptable to the Swing Loan
Lender, on the day requested, if such request is received not later than 2:00
p.m. (New York time) on such day, and if received thereafter on any Business
Day, on the next Business Day. Each request by the Borrower for the making of
Swing Loans shall constitute a Representation and Warranty by the Borrower as
of the time of the making of such Swing Loans that the conditions specified in
Sections 2.02(b) and (c) have been fulfilled at such time. The Swing Loan
Lender shall provide prompt notice to the Administrative Agent and the Banks of
the making of any Swing Loans to the Borrower.
(ii) The Borrower shall repay each Swing Loan no later
than 3:00 p.m. (New York time) on the date specified in the notice of borrowing
delivered under Section 1.01(d)(i) (which shall be a date not later than the
earlier of (A) the third Business Day after the date on which such Swing Loan
is to be made and (B) the Working Capital Maturity Date). The Swing Loan
Lender shall provide prompt notice to the Administrative Agent and the Banks of
any repayment of Swing Loans by the Borrower.
(iii) Upon demand made to all of the Banks by the Swing Loan
Lender, which demand may be made before or after a Default (including a Default
arising under Section 1.01(d)(ii)), but subject to the provisions of Section
1.01(d)(iv), each Bank (other than the Swing Loan Lender) shall irrevocably and
unconditionally purchase from the Swing Loan Lender, without recourse or
warranty, an undivided interest and participation in the Swing Loans then
outstanding, by paying to the Swing Loan Lender, without reduction or deduction
of any kind, including but not limited to reductions or deductions for set-off,
recoupment or counterclaim, in Dollars immediately available to the Swing Loan
Lender at the Swing Loan Lender's Domestic Lending Office, an amount equal to
such Bank's Swing Loan Percentage of the principal amount of all Swing Loans
then outstanding, and thereafter, except as otherwise provided in the second
succeeding sentence, the Banks' respective interests in such Swing Loans,
2
<PAGE> 12
and the remaining interest of the Swing Loan Lender in such Swing Loans, shall
in all respects be treated as Working Capital Loans under this Agreement, but
such Swing Loans shall continue to be evidenced by the Swing Note, and shall
continue to be due and payable by the Borrower in accordance with Section
1.01(d)(ii). If any Bank does not pay any amount which it is required to pay
after giving effect to the provisions of Section 1.01(d)(iv) forthwith upon the
Swing Loan Lender's demand therefor, the Swing Loan Lender shall be entitled to
recover such amount on demand from such Bank, together with interest thereon,
at the Federal Funds Rate for the first three Business Days, and thereafter at
the Base Rate, for each day from the date of such demand, if made prior to 2:00
p.m. (New York time) on any Business Day, or, if made at any other time, from
the next Business Day following the date of such demand, until the date such
amount is paid to the Swing Loan Lender by such Bank. If such Bank does not
pay such amount forthwith upon the Swing Loan Lender's demand therefor, and
until such time as such Bank makes the required payment, the Swing Loan
Lender's remaining interest in the applicable Swing Loan shall continue to
include the amount of such unpaid participation obligation.
(iv) No Bank shall be obligated to purchase a participation
in any Swing Loan unless (A) the Swing Loan Lender believed in good faith that
the conditions specified in Sections 2.02(b) and (c) were satisfied at the time
such Swing Loan was made or (B) such Bank had actual knowledge, by receipt of
information furnished to it pursuant to Section 5.01(e) hereof, or otherwise,
that any such condition had not been satisfied and failed to notify the Swing
Loan Lender in a writing received by the Swing Loan Lender one Business Day
prior to the time that it made such Swing Loan that the Swing Loan Lender was
not authorized to make such Swing Loan or (C) the satisfaction of such
condition that was not satisfied had been waived in accordance with the
provisions of this Agreement.
(e) Type of Loans. Subject to Section 1.06 and the other
terms and conditions of this Agreement, the Loans may, at the option of the
Borrower, be made as, and from time to time continued as or converted into,
Base Rate Loans or Eurodollar Rate Loans of any permitted Type, or any
combination thereof.
Section 1.02. Manner of Borrowing. (a) The Borrower shall
give the Administrative Agent notice (which shall be irrevocable) no later than
10:00 a.m. (New York time) on, in the case of Base Rate Loans (other than Swing
Loans), the requested day for the making of such Loans and, in the case of
Eurodollar Rate Loans, the third Eurodollar Business Day before the requested
date for the making of such Loans. Each such notice shall be in the form of
Schedule 1.02 and shall specify (i) whether the requested Loans are to be Term
A Loans, Term B Loans, RC Loans or Working Capital Loans, (ii) the requested
date for the making of the requested Loans, which shall be, in the case of Base
Rate Loans, a Business Day and, in the case of Eurodollar
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<PAGE> 13
Rate Loans, a Eurodollar Business Day, (iii) the Type or Types of Loans
requested and (iv) the amount of each such Type of Loan, which amount shall be
$5,000,000 or any integral multiple of $1,000,000 in excess thereof or the
amount of the unused Total RC Commitment or Total Working Capital Commitment,
as the case may be. Upon receipt of any such notice, the Administrative Agent
shall promptly notify each Bank of the contents thereof and of the amount and
Type of each Loan to be made by such Bank on the requested date specified
therein.
(b) Not later than 12:00 noon (New York time) on each
requested date for the making of Loans (other than Swing Loans), each Bank
shall make available to the Administrative Agent, in Dollars in funds
immediately available to the Administrative Agent at the Administrative Agent's
Office, the Loans to be made by such Bank on such date. The obligations of the
Banks hereunder are several and, accordingly, any Bank's failure to make any
Loan to be made by it on the requested date therefor shall not relieve any
other Bank of its obligation to make any Loan to be made by such other Bank on
such date, but such other Bank shall not be liable for such failure.
(c) Unless the Administrative Agent shall have received
notice from a Bank prior to 12:00 noon (New York time) on the requested date
for the making of any Loan by such Bank that such Bank will not make available
to the Administrative Agent the Loans requested to be made by such Bank on such
date, the Administrative Agent may assume that such Bank has made such Loans
available to the Administrative Agent on such date in accordance with Section
1.02(b) and the Administrative Agent in its sole discretion may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount on behalf of such Bank. If and to the extent such Bank
shall not have so made available to the Administrative Agent the Loans
requested to be made by such Bank on such date and the Administrative Agent
shall have so made available to the Borrower a corresponding amount on behalf
of such Bank, such Bank shall, on demand, pay to the Administrative Agent such
corresponding amount together with interest thereon, for each day from the date
such amount shall have been so made available by the Administrative Agent to
the Borrower until the date such amount shall have been paid to the
Administrative Agent, at the Federal Funds Rate until (and including) the third
Business Day after demand is made and thereafter at the Base Rate. If such
Bank does not pay such corresponding amount promptly upon the Administrative
Agent's demand therefor, the Administrative Agent shall promptly notify the
Borrower and the Borrower shall promptly repay such corresponding amount to the
Administrative Agent together with accrued interest thereon at the applicable
rate or rates provided in Section 1.04(a); provided, however, that, with
respect to such repayment, the Borrower shall have no liability with respect to
losses, costs or expenses otherwise compensable under Section 7.04 in
connection therewith.
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<PAGE> 14
(d) All Loans made available to the Administrative Agent in
accordance with Section 1.02(b) shall be disbursed by the Administrative Agent
promptly but in any event not later than 3:00 p.m. (New York time) on the
requested date therefor in Dollars in funds immediately available to the
Borrower by credit to an account of the Borrower at the Administrative Agent's
Office or in such other manner as may have been specified in the applicable
notice and as shall be acceptable to the Administrative Agent.
Section 1.03. Letters of Credit. (a) Upon the terms and
subject to the conditions of this Agreement, the Issuing Bank shall, from time
to time, on or prior to the tenth Business Day preceding the Working Capital
Maturity Date, issue one or more Letters of Credit for the account of the
Borrower, provided that (A) the aggregate principal amount of all Letter of
Credit Participations shall not exceed the LC Commitment at any time and (B)
the aggregate amount of all Letter of Credit Participations together with the
aggregate unpaid principal amount of all Working Capital Loans and Swing Loans
shall not at any time exceed the Total Working Capital Commitment at such time.
Each Letter of Credit shall be in a form and shall contain such terms as shall
be reasonably satisfactory to the Issuing Bank. The letters of credit issued
in connection with the Predecessor Indebtedness and outstanding on the Closing
Date shall, from and after the Closing Date, constitute Letters of Credit for
all purposes hereunder.
(b) Each Letter of Credit shall be denominated only in
Dollars and shall expire on or before the first anniversary of the issuance
thereof and in any event not later than the fifth Business Day preceding the
Working Capital Maturity Date. Any extension of the expiry date of a Letter of
Credit to a date beyond the first anniversary of the issuance thereof shall
constitute an "issuance" of such Letter of Credit for all purposes hereof.
(c) Letters of Credit shall be issued only on a Business Day,
and shall be used for the general corporate purposes of the Borrower and the
Subsidiaries.
(d) The Borrower shall request the issuance of a Letter
of Credit by furnishing to the Administrative Agent and the Issuing Bank, at
least one Business Day before the requested date of such issuance, in the case
of standby letters of credit, or on the requested date of such issuance, in the
case of trade letters of credit, notice thereof in the form of Schedule 1.02 or
such other notice as shall be reasonably satisfactory to the Issuing Bank (and,
in the case of any such notice, the Borrower shall be deemed to have made the
Representation and Warranty with respect to such issuance provided for in the
final paragraph of the form of notice set forth in Schedule 1.02).
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<PAGE> 15
(e) Upon the date of issuance of a Letter of Credit (or,
in the case of the Letters of Credit referred to in the last sentence of
Section 1.03(a), on the Closing Date), the Issuing Bank shall be deemed to have
granted to each Participating Bank (other than the Issuing Bank), and each
Participating Bank (other than the Issuing Bank) shall be deemed to have
acquired from the Issuing Bank without further action by any party hereto, a
participation in such Letter of Credit and any Drawings that may at any time be
made thereunder, to the extent of such Bank's Participating Bank Percentage
thereof.
(f) The Issuing Bank shall promptly notify the Borrower
of its receipt of each Drawing request with respect to a Letter of Credit,
stating the date and amount of the Drawing requested thereby and the date and
amount of each Drawing disbursed pursuant to such request. The failure of the
Issuing Bank to give, or delay in giving, any such notice shall not release or
diminish the obligations hereunder of the Borrower in respect of such Drawing.
(g) The Borrower shall, on the day it receives notice of
each Drawing, if such notice is received prior to 10:00 a.m. (New York time) on
such day, and on the Business Day following the day it receives such notice, if
such notice is received after 10:00 a.m. (New York time) on such day, reimburse
such Drawing by paying to the Issuing Bank in immediately available funds the
amount of the payment made by the Issuing Bank with respect to such Drawing,
together with interest thereon at a rate per annum equal to the Base Rate as in
effect from time to time plus the Applicable Margin until the day such
reimbursement is made if such Drawing is not reimbursed on the day notice is
received. In the event that the Borrower shall fail to make any such payment
when due and for so long as such failure shall be continuing, the Issuing Bank
may give notice of such failure to the Administrative Agent and each
Participating Bank, which notice shall include, in the case of a Participating
Bank, the amount of such Participating Bank's Participating Bank Percentage of
such Drawing, whereupon each such Participating Bank (other than the Issuing
Bank) shall promptly remit such amount to the Administrative Agent for the
account of the Issuing Bank as provided in Section 1.03(h).
(h) Each Participating Bank (other than the Issuing Bank)
shall, in the event it receives the notice from the Issuing Bank pursuant to
Section 1.03(g) at or before 12:00 noon (New York time) on any Business Day,
fund its participation in any unreimbursed Drawing by remitting to the
Administrative Agent, no later than 2:00 p.m. (New York time) on such day, in
immediately available funds its Participating Bank Percentage of the
reimbursement obligation in respect of each Drawing. The Administrative Agent
shall, in the event it receives such funds from such Participating Bank at or
before 2:00 p.m. (New York time) on any day, no later than 4:00 p.m. (New York
time) on such day, make available the amount thereof to the Issuing Bank, in
-6-
<PAGE> 16
immediately available funds. Any amount payable by any Participating Bank to
the Administrative Agent for the account of the Issuing Bank under this Section
1.03(h), and any amount payable by the Administrative Agent to the Issuing Bank
under this Section 1.03(h), shall bear interest for each day from the date due
(and including such day if paid after 2:00 p.m. (New York time), in the case of
any such payment by a Participating Bank to the Administrative Agent, or 4:00
p.m. (New York time), in the case of any such payment by the Administrative
Agent to the Issuing Bank, on such day) in accordance with this Section 1.03(h)
until the date it is received by the Issuing Bank at a rate equal to the
Federal Funds Rate until (and including) the third Business Day after the date
due and thereafter at the Base Rate. Each Participating Bank shall, upon the
demand of the Issuing Bank, reimburse the Issuing Bank, to the extent the
Issuing Bank has not been reimbursed by the Borrower after demand therefor, for
the reasonable costs and expenses (including reasonable legal fees) incurred by
it (other than as a result of its willful misconduct or gross negligence) in
connection with the collection of amounts due under, the administration of, and
the preservation and enforcement of any rights conferred by, the Letters of
Credit or the performance of the Issuing Bank's obligations under this
Agreement in respect thereof (other than its obligation to make Loans in its
capacity as a Bank or Swing Loans in its capacity as the Swing Loan Lender), to
the extent of such Participating Bank's Participating Bank Percentage (as of
the time such costs and expenses are incurred) of the amount of such costs and
expenses. The Issuing Bank shall refund any costs and expenses reimbursed by
such Participating Bank that are subsequently recovered from the Borrower in an
amount equal to such Participating Bank's Participating Bank Percentage
thereof.
(i) On or before the tenth Business Day of each month,
the Issuing Bank shall provide to the Administrative Agent and each Bank a
notice setting forth, with respect to the previous calendar month, the average
daily aggregate amount of Contingent Reimbursement Obligations under each
Letter of Credit that was a standby letter of credit during such month and the
average daily aggregate amount of Contingent Reimbursement Obligations under
each Letter of Credit that was a trade letter of credit during such month.
(j) The obligation of each Participating Bank to make
available to the Issuing Bank the amounts set forth in this Section 1.03 shall
be absolute, unconditional and irrevocable under any and all circumstances
without reduction for any set-off or counterclaim of any nature whatsoever, and
may not be terminated, suspended or delayed for any reason whatsoever, shall
not be subject to any qualification or exception and shall be made in
accordance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
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<PAGE> 17
(i) any lack of validity or enforceability of
this Agreement or any of the other Loan Documents;
(ii) the existence of any claim, setoff, defense or
other right which the Borrower may have at any time against a
beneficiary named in a Letter of Credit, any transferee of any Letter
of Credit (or any Person for whom any such transferee may be acting),
any Agent, the Issuing Bank, any Participating Bank or any other
Person, whether in connection with this Agreement, any Letter of
Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transaction between the Borrower
and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document
presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security
for the performance or observance of any of the terms of any of the
Loan Documents; or
(v) the occurrence of any Default.
(k) (i) Without affecting any rights the Participating
Banks may have under Applicable Law, the Borrower agrees that none of the
Participating Banks, the Issuing Bank, the Agents or their respective officers
or directors shall be liable or responsible for, and the obligations of the
Borrower to the Participating Banks, the Issuing Bank and the Agents hereunder
shall not in any manner be affected by: (A) the use that may be made of any
Letter of Credit or the proceeds thereof by the beneficiary thereof or any
other Person or any acts or omissions of such beneficiary or any other Person;
(B) the validity, sufficiency or genuineness of documents presented in
connection with any Drawing, or of any endorsements thereon, even if such
documents should, in fact, prove to be in any or all respects, invalid,
insufficient, fraudulent or forged; or (C) any other circumstances whatsoever
in making or failing to make payment under any Letter of Credit or any other
action taken or omitted to be taken by any Person under or in connection with
any Letter of Credit, except that the Borrower shall have a claim against the
Issuing Bank and the Issuing Bank shall be liable to the Borrower, in each case
to the extent and only to the extent of any damages suffered by the Borrower
that are caused by (1) the Issuing Bank's willful misconduct or gross
negligence (as determined by a court of competent jurisdiction) in determining
whether documents presented under any Letter of Credit issued by the Issuing
Bank complied with the terms of such Letter of Credit or (2) the Issuing Bank's
willful failure (as determined by a court of competent jurisdiction) to pay
under such Letter of Credit after the presentation to it of documents strictly
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<PAGE> 18
complying with the terms and conditions of such Letter of Credit. In
furtherance and not in limitation of the foregoing, in determining whether to
pay under any Letter of Credit, the Issuing Bank shall not have any obligation
relative to the other Banks other than to determine that any documents required
to be delivered under such Letter of Credit appear to have been delivered and
that they appear to comply on their face with the requirements of such Letter
of Credit, regardless of any notice or information to the contrary. Any action
taken or omitted to be taken by the Issuing Bank under or in connection with
any Letter of Credit if taken or omitted in the absence of gross negligence or
willful misconduct, shall not create for the Issuing Bank any resulting
liability to any Bank.
(ii) In addition to any other amounts payable
under this Agreement, the Borrower agrees to protect, indemnify, pay and hold
the Issuing Bank harmless from and against any and all claims, costs, charges
and expenses (including reasonable attorneys' fees) which the Issuing Bank may
incur or be subject to as a consequence, direct or indirect, of (A) the
issuance of, or payment of any drawing under, any Letter of Credit, other than
as a result of the gross negligence or willful misconduct of the Issuing Bank
as determined by a court of competent jurisdiction or (B) the failure of the
Issuing Bank to honor a drawing under any Letter of Credit as a result of any
act or omission of any present or future government or governmental authority.
(iii) The Issuing Bank shall not be responsible for:
(A) the form, validity, sufficiency,
accuracy, genuineness or legal effect of any document submitted by any
party in connection with the issuance of Letters of Credit,
(B) the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or
assign a Letter of Credit or the rights or benefits thereunder or
proceeds thereof in whole or in part,
(C) errors, omissions, interruptions, or
delays in transmissions or delivery of any messages, by mail, cable,
telecopy, telex or otherwise, whether or not in cipher,
(D) the misapplication by the
beneficiary of any Letter of Credit or the proceeds of any drawing
under such Letter of Credit, and
(E) any consequence arising from causes
beyond the control of the Issuing Bank, including, without limitation,
any governmental acts.
-9-
<PAGE> 19
(l) If any Bank Nonparticipation occurs with respect to
any Bank, (A) the Administrative Agent and such Bank agree, if requested by the
Borrower, to attempt to locate a bank or other financial institution that
desires to accept the assignment of the Loans, Letter of Credit Participations,
Commitments and other rights and obligations hereunder of such Bank and (B) if
such bank or other financial institution is located, such Bank agrees to assign
its interest in its Loans, Letter of Credit Participations, Commitments and
other rights and obligations hereunder to such bank or other financial
institution in accordance with Section 9.10.
Section 1.04. Interest. (a) Rates. Each Loan shall bear
interest on the outstanding principal amount thereof until due at a rate per
annum equal to, (i) so long as it is a Base Rate Loan, the Base Rate as in
effect from time to time plus the Applicable Margin and (ii) so long as it is a
Eurodollar Rate Loan, the applicable Eurodollar Rate plus the Applicable
Margin. If all or any part of a Loan, reimbursement of a Drawing or any other
amount due and payable under the Borrower Loan Documents is not paid when due
(whether at maturity, by reason of notice of prepayment or acceleration or
otherwise), such unpaid amount shall, to the maximum extent permitted by
Applicable Law, bear interest for each day during the period from the date such
amount became so due until it shall be paid in full (whether before or after
judgment) at a rate per annum equal to the applicable Post-Default Rate.
(b) Payment. Interest shall be payable, (i) in the case of
Base Rate Loans, on each Interest Payment Date, (ii) in the case of Eurodollar
Rate Loans, on the last day of each applicable Interest Period (and, in the
case of a Eurodollar Rate Loan having an Interest Period longer than three
months, on each three month anniversary of the first day of such Interest
Period) and (iii) in the case of any Loan, when such Loan shall be due (whether
at maturity, upon mandatory prepayment, by reason of notice of prepayment or
acceleration or otherwise) or converted, but only to the extent then accrued on
the amount then so due or converted. Interest at the Post-Default Rate shall
be payable on demand.
(c) Conversion and Continuation. (i) All or any part of the
principal amount of Loans of any Type may, on any Business Day, be converted
into any other Type or Types of Loans, except that (A) Eurodollar Rate Loans
may be converted only on the last day of the applicable Interest Periods
therefor, (B) Base Rate Loans may be converted into Eurodollar Rate Loans only
on a Eurodollar Business Day and (C) Swing Loans shall be maintained as Base
Rate Loans at all times.
(ii) Base Rate Loans shall continue as Base Rate Loans
unless and until such Loans are converted into Loans of another Type.
Eurodollar Rate Loans of any Type shall continue as Loans of such Type until
the end of the then current Interest
-10-
<PAGE> 20
Period therefor, at which time they shall be automatically converted into Base
Rate Loans unless the Borrower shall have given the Administrative Agent notice
in accordance with Section 1.04(c)(iv) requesting either that such Loans
continue as Loans of such Type for another Interest Period or that such Loans
be converted into Loans of another Type at the end of such Interest Period.
(iii) Notwithstanding anything to the contrary contained
in Section 1.04(c)(i) or (ii), so long as an Event of Default shall have
occurred and be continuing, the Administrative Agent may (and, at the request
of Banks having more than 66-2/3% of the Loans and Letter of Credit
Participations outstanding (or, if there are not Loans or Letter of Credit
Participations then outstanding, more than 66-2/3% of the aggregate amount of
the Commitments), shall) notify the Borrower that Loans may only be converted
into or continued upon the expiration of the applicable current Interest Period
therefor as Loans of certain specified Types and, thereafter, until no Event of
Default shall continue to exist, Loans may not be converted into or continued
as Loans of any Type other than one or more of such specified Types.
(iv) The Borrower shall give the Administrative Agent
notice (which shall be irrevocable) of each conversion of Loans or continuation
of Eurodollar Rate Loans no later than 11:00 a.m. (New York time) on, in the
case of a conversion into Base Rate Loans, the requested date of such
conversion and, in the case of a conversion into or continuation of Eurodollar
Rate Loans, the third Eurodollar Business Day before the requested date of such
conversion or continuation. Each notice of conversion or continuation shall be
in the form of Schedule 1.04(c)(iv) and shall specify (A) the requested date of
such conversion or continuation, (B) the amount and Type and, in the case of
Eurodollar Rate Loans, the last day of the applicable Interest Period for the
Loans to be converted or continued and (C) the amount and Type or Types of
Loans into which such Loans are to be converted or as which such Loans are to
be continued. Upon receipt of any such notice, the Administrative Agent shall
promptly notify each Bank of (x) the contents thereof, (y) the amount and Type
and, in the case of Eurodollar Rate Loans, the last day of the applicable
Interest Period for each Loan to be converted or continued by such Bank and (z)
the amount and Type or Types of Loans into which such Loans are to be converted
or as which such Loans are to be continued.
(d) Maximum Interest Rate. Nothing contained in the Loan
Documents shall require the Borrower at any time to pay interest at a rate
exceeding the Maximum Permissible Rate. If interest payable by the Borrower on
any date would exceed the maximum amount permitted by the Maximum Permissible
Rate, such interest payment shall automatically be reduced to such maximum
amount permitted, and interest for any subsequent period, to the extent less
than the maximum amount permitted for such period by the Maximum Permissible
Rate, shall be increased by the unpaid
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<PAGE> 21
amount of such reduction. Any interest actually received for any period in
excess of such maximum amount permitted for such period shall be deemed to have
been applied as a prepayment of the corresponding Loans.
Section 1.05. Repayment. (a) Term A Loans. The Term A
Loans shall mature and become due and payable and shall be repaid by the
Borrower in quarterly installments, payable on successive Installment Payment
Dates commencing with April 30, 1996 and ending with the Term A Maturity Date
(whether or not such date would otherwise be an Installment Payment Date).
Each such installment shall be in an amount equal to one quarter of the amount
set forth below for the applicable year, provided that the final installment
shall be in an amount equal to the amount of Term A Loans then outstanding.
<TABLE>
<CAPTION>
Year Ending Amount
----------- ------
<S> <C>
January 31, 1997 $25,000,000
January 31, 1998 $50,000,000
January 31, 1999 $75,000,000
January 31, 2000 $100,000,000
January 31, 2001 $100,000,000
January 31, 2002 $120,000,000
January 31, 2003 $130,000,000
</TABLE>
(b) Term B Loans. The Term B Loans shall mature and
become due and payable and shall be repaid by the Borrower in quarterly
installments, payable on successive Installment Payment Dates commencing with
April 30, 1996 and ending with the Term B Maturity Date (whether or not such
date would otherwise be an Installment Payment Date). Each such installment
shall be in an amount equal to one quarter of the amount set forth below for
the applicable year, provided that the final installment shall be in an amount
equal to the amount of Term B Loans then outstanding.
<TABLE>
<CAPTION>
Year Ending Amount
----------- ------
<S> <C>
January 31, 1997 $1,000,000
January 31, 1998 $1,000,000
January 31, 1999 $1,000,000
January 31, 2000 $1,000,000
January 31, 2001 $1,000,000
January 31, 2002 $1,000,000
January 31, 2003 $15,000,000
</TABLE>
-12-
<PAGE> 22
<TABLE>
<S> <C>
January 31, 2004 $179,000,000
</TABLE>
(c) RC Loans. The aggregate outstanding principal amount of
the RC Loans shall mature and become due and payable, and shall be repaid by
the Borrower, on the RC Maturity Date.
(d) Working Capital Loans. The aggregate outstanding
principal amount of the Working Capital Loans shall mature and become due and
payable, and shall be repaid by the Borrower, on the Working Capital Maturity
Date.
(e) Drawings. The Borrower shall reimburse the Issuing
Bank for each Drawing under a Letter of Credit on the date determined with
respect to such Drawing in the manner set forth in Section 1.03(g).
(f) Swing Loans. Each Swing Loan shall mature and become
due and payable, and shall be repaid by the Borrower, on the date determined
with respect to such Swing Loan in the manner set forth in Section 1.01(d)(ii).
Section 1.06. Prepayments. (a) Optional Prepayments. The
Borrower may, at any time and from time to time, prepay the Loans in whole or
in part, without premium or penalty, except that any optional partial
prepayment (other than Swing Loans) shall be in an aggregate principal amount
of $5,000,000 or any integral multiple of $1,000,000 in excess thereof, and any
prepayment of Term Loans shall be made pro rata between the Term A Loans and
the Term B Loans at the time outstanding in accordance with the relative
aggregate principal amounts thereof. Prepayments of the Term A Loans and the
Term B Loans shall be applied to each of the respective remaining installments
thereof pro rata in accordance with the relative amounts thereof. Any
prepayment of Eurodollar Rate Loans made on a day other than the last day of
the applicable Interest Periods therefor shall be accompanied by the amount, if
any, required to be paid in respect thereof pursuant to Section 7.04. The
Borrower shall give the Administrative Agent notice of each prepayment no later
than 11:00 a.m. (New York time) on, in the case of a prepayment of Base Rate
Loans (other than Swing Loans), the first Business Day before and, in the case
of a prepayment of Eurodollar Rate Loans, the third Eurodollar Business Day
before, the date of such prepayment and, in the case of a prepayment of Swing
Loans, the day of such prepayment. Each such notice of prepayment shall be in
the form of Schedule 1.06 and shall specify (i) the date such prepayment is to
be made and (ii) whether the Loans to be prepaid are Term A Loans, Term B
Loans, RC Loans, Working Capital Loans or Swing Loans and the amount and Type
and, in the case of Eurodollar Rate Loans, the last day of the applicable
Interest Periods for the Loans to be prepaid. Upon receipt of any such notice,
the Administrative Agent shall promptly notify each Bank of the contents
thereof and the amount and Type and, in the case of Eurodollar Rate Loans, the
last day of the applicable Interest Periods for the Loans of such Bank to be
prepaid. Amounts to be
-13-
<PAGE> 23
so prepaid shall irrevocably be due and payable on the date specified in the
applicable notice of prepayment, together with interest thereon as provided in
Section 1.04(b).
(b) Mandatory Prepayments. (i) Excess Cash Flow.
Commencing with the fiscal year of the Borrower ending January 31, 1997, upon
the earlier of the date on which the Administrative Agent receives the
financial statements specified in Section 5.01(b) hereof with respect to the
most recently ended fiscal year of the Borrower and the date by which the
Borrower is required to provide the Administrative Agent with such financial
statements, the Borrower shall prepay the Loans in an amount equal to, in the
case of the fiscal year ending January 31, 1997, 75% of Excess Cash Flow for
such fiscal year and, in the case of each subsequent fiscal year, 50% of Excess
Cash Flow for such fiscal year; provided, however that no prepayments under
this Section 1.06(b)(i) shall be required with respect to Excess Cash Flow for
any fiscal year if the Leverage Ratio is less than or equal to 3.50 as of the
time that such prepayment would otherwise be required to be made.
(ii) Dispositions. Promptly upon, but in any event within
five Business Days following, the receipt by the Borrower or any Subsidiary of
any Net Proceeds of any sale or disposition contemplated by Section 4.08(h)
(other than the disposition by the Borrower of up to 50% of its interest in
QVC, an English unlimited liability company) the amount of which, together with
the aggregate amount of Net Proceeds of all other such sales or dispositions
contemplated by Section 4.08(h) (other than the disposition by the Borrower of
up to 50% of its interest in QVC, an English unlimited liability company) made
since the Agreement Date (including all such Net Proceeds that were the basis
of a previous mandatory prepayment pursuant to this Section 1.06(b)(ii)), are
in excess of $15,000,000, the Borrower shall prepay the Loans in an amount
equal to 75% of such newly-received Net Proceeds.
(iii) Permitted Replacement Debt. Immediately upon the
receipt by (A) the Borrower of net proceeds of Permitted Borrower Replacement
Debt or (B) Holdco of net proceeds of Permitted Holdco Replacement Debt, the
Borrower shall prepay the Term B Loans in a principal amount equal to such net
proceeds, together with interest thereon as provided in Section 1.04(b).
(iv) Clean-Up Prepayments. The Borrower shall prepay
Working Capital Loans and Swing Loans at such times and in such amounts so that
there shall be no Working Capital Loans or Swing Loans outstanding for a period
of 30 consecutive days during the period of 365 days immediately preceding the
date of determination, other than one Swing Loan made during such 30 day period
that is repaid within two Business Days of the date on which such Swing Loan
was made.
-14-
<PAGE> 24
(v) Reduction of RC Availability. If, after giving
effect to any reduction of the Total RC Commitment pursuant to Section 1.08,
the aggregate outstanding principal amount of the RC Loans exceeds the Total RC
Commitment, the Borrower shall prepay the RC Loans in an aggregate amount equal
to the amount of such excess, together with interest thereon as provided in
Section 1.04(b), on the date of such reduction.
(vi) Reduction of Working Capital Availability. If, after
giving effect to any reduction of the Total Working Capital Commitment pursuant
to Section 1.08, the sum of the aggregate outstanding principal amount of the
Working Capital Loans and Swing Loans and the aggregate amount of Letter of
Credit Participations exceeds the Total Working Capital Commitment, the
Borrower shall prepay the Working Capital Loans, the Swing Loans and the
Contingent Reimbursement Obligations in an aggregate amount equal to the amount
of such excess, together with interest thereon as provided in Section 1.04(b),
on the date of such reduction.
(vii) Application and Timing. Amounts prepaid pursuant to
Section 1.06(b)(i) or (ii) shall be applied to prepay (A) the Term Loans, (B)
to the extent that the amount of any such prepayment exceeds the then
outstanding aggregate principal amount of the Term Loans, the RC Loans and (C)
to the extent that the amount of such prepayment exceeds the then outstanding
aggregate principal amount of the Term Loans and the RC Loans, the Working
Capital Loans, the Swing Loans and the Contingent Reimbursement Obligations.
Prepayments of the Term Loans pursuant to Section 1.06(b)(i) or (ii) shall be
applied pro rata to the Term A Loans and the Term B Loans in accordance with
the relative aggregate principal amounts thereof then outstanding and the
resulting prepayment of the Term A Loans and the Term B Loans, respectively,
shall be applied to each of the respective remaining installments thereof pro
rata in accordance with the relative amounts thereof. Prepayments of Loans
made pursuant to this Section 1.06(b) shall, unless the Borrower shall have
given a notice setting forth the Eurodollar Rate Loans to be prepaid by no
later than 11:00 a.m. (New York time) on the third Eurodollar Business Day
before the date of such prepayment, be applied first to prepay Base Rate Loans
and then to prepay Eurodollar Rate Loans in the order that the Interest Periods
for such Loans end. Amounts to be so prepaid shall be paid on the date
specified therefor, whether or not such payment would require a prepayment of
any Eurodollar Rate Loans prior to the last day of the applicable Interest
Periods therefor or would result in losses, costs or expenses compensable under
Section 7.04. Any prepayment of the Contingent Reimbursement Obligations shall
be held as cash collateral in accordance with Section 9.19.
Section 1.07. Limitation on Types of Loans. Notwithstanding
anything to the contrary contained in this Agreement, the Borrower shall
borrow, prepay, convert and continue Loans in a manner such that (a) the
aggregate principal
-15-
<PAGE> 25
amount of Eurodollar Rate Loans of the same Type shall at all times be not less
than $10,000,000 and (b) there shall not be, at any one time, more than ten
Interest Periods in effect with respect to Eurodollar Rate Loans of all Types.
Section 1.08. Reductions of Total RC Commitment and Total
Working Capital Commitment. (a) Scheduled Reductions of Total RC Commitment.
Subject to the adjustments described in Section 1.08(d), the Total RC
Commitment shall be automatically reduced on a quarterly basis, on successive
Installment Payment Dates commencing with April 30, 1996 and ending with the RC
Maturity Date (whether or not such date would otherwise be an Installment
Payment Date). Each such reduction shall be in an amount equal to one quarter
of the amount set forth below for the applicable year, provided that the final
reduction shall be in an amount equal to the Total RC Commitment then
outstanding.
<TABLE>
<CAPTION>
Year Ending Amount
----------- ------
<S> <C>
January 31, 1997 $10,000,000
January 31, 1998 $26,250,000
January 31, 1999 $26,250,000
January 31, 2000 $35,000,000
January 31, 2001 $61,250,000
January 31, 2002 $78,750,000
January 31, 2003 $87,500,000
</TABLE>
(b) Optional Reductions. (i) Total RC Commitment. The
Borrower may reduce the Total RC Commitment by giving the Administrative Agent
notice (which shall be irrevocable) thereof no later than 11:00 a.m. (New York
time) on the third Business Day before the requested date of such reduction,
except that each partial reduction thereof shall be in an amount equal to
$5,000,000 or any integral multiple of $1,000,000 in excess thereof and that no
reduction shall reduce the Total RC Commitment to an amount less than the
aggregate of the principal amount of all RC Loans outstanding on such date
(after giving effect to any repayment or prepayment of RC Loans to be made on
or prior to such date). Upon receipt of any such notice, the Administrative
Agent shall promptly notify each RC Bank of the contents thereof and the amount
to which such RC Bank's RC Commitment is to be reduced.
(ii) Total Working Capital Commitment. The
Borrower may reduce the Total Working Capital Commitment by giving the
Administrative Agent notice (which shall be irrevocable) thereof no later than
11:00 a.m. (New York time) on the third Business Day before the requested date
of such reduction, except that each partial reduction thereof shall be in an
amount equal to $5,000,000 or any integral multiple of
-16-
<PAGE> 26
$1,000,000 in excess thereof and that no reduction shall reduce the Total
Working Capital Commitment to an amount less than the sum of the aggregate
principal amount of all Working Capital Loans and Swing Loans and the amount of
all Letter of Credit Participations outstanding on such date (after giving
effect to any repayment or prepayment of Working Capital Loans or Swing Loans
to be made, and any expiration or termination of any Letters of Credit to
occur, on or prior to such date). Upon receipt of any such notice, the
Administrative Agent shall promptly notify each Working Capital Bank of the
contents thereof and the amount to which such Working Capital Bank's Working
Capital Commitment is to be reduced.
(c) Mandatory Reductions. (i) Total RC Commitment. The
Total RC Commitment shall be reduced at the time of each mandatory prepayment
of Loans required to be made (or that would have been required to be made if
Loans had been outstanding at such time) (A) pursuant to Section 1.06(b)(i) by
an amount equal to the excess, if any, of (x) 75% of Excess Cash Flow for the
fiscal year of the Borrower ending January 31, 1997 and 50% of Excess Cash Flow
for the applicable subsequent fiscal year over (y) the aggregate principal
amount of Term Loans outstanding at such time and (B) pursuant to Section
1.06(b)(ii) by an amount equal to the excess, if any, of (x) 75% of the
newly-received Net Proceeds referred to in Section 1.06(b)(ii) over (y) the
aggregate principal amount of Term Loans outstanding at such time.
(ii) Total Working Capital Commitment. The Total
Working Capital Commitment shall be reduced at the time of each mandatory
prepayment of Loans required to be made (or that would have been required to be
made if Loans had been outstanding at such time) (A) pursuant to Section
1.06(b)(i) by an amount equal to the excess, if any, of (x) 75% of Excess Cash
Flow for the fiscal year of the Borrower ending January 31, 1997 and 50% of
Excess Cash Flow for the applicable subsequent fiscal year over (y) the sum of
(I) the aggregate principal amount of Term Loans outstanding at such time and
(II) the Total RC Commitment at such time and (B) pursuant to Section
1.06(b)(ii) by an amount equal to the excess, if any, of (x) 75% of the
newly-received Net Proceeds referred to in Section 1.06(b)(ii) over (y) the sum
of (I) the aggregate principal amount of Term Loans outstanding at such time and
(II) the Total RC Commitment at such time.
(d) Adjustments. Upon each reduction of the Total RC
Commitment pursuant to Section 1.08(b) or 1.08(c), the remaining scheduled
reductions thereof set forth in Section 1.08(a) shall be adjusted, after giving
effect to any prior adjustments thereto pursuant to this Section 1.08(d), by
reducing the scheduled reductions in their direct chronological order.
(e) No Reinstatement. No reduction of the Total RC
Commitment or the Total Working Capital Commitment may be reinstated.
-17-
<PAGE> 27
Section 1.09. Fees. (a) Commitment Fees. (i) RC
Commitment. The Borrower shall pay to the Administrative Agent, for the
account of each RC Bank, a commitment fee on the daily unused amount of such RC
Bank's RC Commitment for each day from and including the Agreement Date to but
excluding the RC Maturity Date at a rate per annum equal to (i) for each day
that the Leverage Ratio is greater than or equal to 3.00 to 1, 0.375% or (ii)
for each day that the Leverage Ratio is less than 3.00 to 1, 0.300%, payable in
arrears on successive Interest Payment Dates, on the date of any reduction of
such Commitment (to the extent accrued and unpaid on the amount of such
reduction) and on the RC Maturity Date.
(ii) Working Capital Commitment. The Borrower shall pay to
the Administrative Agent, for the account of each Working Capital Bank, a
commitment fee on the daily unused amount of such Working Capital Bank's
Working Capital Commitment for each day from and including the Agreement Date
to but excluding the Working Capital Maturity Date at a rate per annum equal to
(i) for each day that the Leverage Ratio is greater than or equal to 3.00 to 1,
0.375% or (ii) for each day that the Leverage Ratio is less than 3.00 to 1,
0.300%, payable in arrears on successive Interest Payment Dates, on the date of
any reduction of such Commitment (to the extent accrued and unpaid on the
amount of such reduction) and on the Working Capital Maturity Date.
(b) Letter of Credit Fees. The Borrower shall pay to the
Administrative Agent, for the respective accounts of the Participating Banks,
(i) a letter of credit fee on the daily aggregate amount of the Contingent
Reimbursement Obligations under each Letter of Credit which is a standby letter
of credit at a rate per annum equal to the Applicable Margin that would be
applicable to Working Capital Loans that are Eurodollar Rate Loans at such
time, and (ii) a letter of credit fee on the daily aggregate amount of the
Contingent Reimbursement Obligations under each Letter of Credit which is a
trade letter of credit at a rate per annum equal to 50% of the Applicable
Margin that would be applicable to Working Capital Loans that are Eurodollar
Rate Loans at such time. Such fees shall be payable in arrears on successive
Interest Payment Dates.
Section 1.10. Computation of Interest and Fees. Interest
calculated on the basis of the Eurodollar Rate or the Federal Funds Rate shall
be computed on the basis of a year of 360 days and paid for the actual number
of days elapsed. Commitment fees, letter of credit fees and interest
calculated on the basis of the Prime Rate shall be computed on the basis of a
year of 365 or 366 days, as applicable, and paid for the actual number of days
elapsed. Interest, commitment fees and letter of credit fees for any period
shall be calculated from and including the first day thereof to but excluding
the last day thereof.
Section 1.11. Payments by the Borrower. (a) Time, Place and
Manner. All payments due to the Administrative Agent,
-18-
<PAGE> 28
the Swing Loan Lender or the Issuing Bank under the Borrower Loan Documents
shall be made to the Administrative Agent at the Administrative Agent's Office
or to such other Person or at such other address as the Administrative Agent,
the Swing Loan Lender or the Issuing Bank, respectively, may designate by
notice to the Borrower. All payments due to any Bank under the Borrower Loan
Documents shall, in the case of payments on account of principal of or interest
on the Loans or fees, be made to the Administrative Agent at the Administrative
Agent's Office and, in the case of all other payments, be made directly to such
Bank at its Domestic Lending Office or at such other address as such Bank may
designate by notice to the Borrower. All payments due to any Bank under the
Borrower Loan Documents, whether made to the Administrative Agent or directly
to such Bank, shall be made for the account of, in the case of payments in
respect of Eurodollar Rate Loans, such Bank's Eurodollar Lending Office and, in
the case of all other payments, such Bank's Domestic Lending Office. A payment
shall not be deemed to have been made on any day unless such payment has been
received by the required Person, at the required place of payment, in Dollars
in funds immediately available to such Person, no later than 1:00 p.m. (New
York time) on such day; provided, however, that the failure of the Borrower to
make any such payment by such time shall not constitute a Default hereunder so
long as such payment is received no later than 3:00 p.m. (New York time) on
such day, but any such payment received later than 1:00 p.m. (New York time) on
such day shall be deemed to have been made on the next Business Day for the
purpose of calculating interest on the amount paid, which interest, in the case
of any such payment received later than 3:00 p.m. (New York time), shall be
calculated for such one-day period on the basis of the applicable Post- Default
Rate; provided further, however, that any such payment made with the proceeds
of Loans under Section 1.01(b), (c) or (d) shall be deemed to have been made on
the date of the making of such Loans, so long as such proceeds are immediately
so applied and are not otherwise disbursed to the Borrower.
(b) No Reductions. All payments due to the Administrative
Agent, the Issuing Bank, the Swing Loan Lender or any Bank under the Borrower
Loan Documents, and all other terms, conditions, covenants and agreements to be
observed and performed by the Borrower thereunder, shall be made, observed or
performed by the Borrower without any reduction or deduction whatsoever,
including any reduction or deduction for any set-off, recoupment, counterclaim
(whether sounding in tort, contract or otherwise) or Tax, except for, so long
as the Borrower is in compliance with Section 1.13, any withholding or
deduction for Taxes required to be withheld or deducted under Applicable Law.
(c) Authorization to Charge Accounts. The Borrower hereby
authorizes the Administrative Agent, the Issuing Bank, the Swing Loan Lender
and each Bank, if and to the extent any amount payable by the Borrower under
the Borrower Loan Documents (whether payable to such Person or to any other
Person that is
-19-
<PAGE> 29
the Administrative Agent, the Issuing Bank, the Swing Loan Lender or a Bank) is
not otherwise paid when due, to charge such amount against any or all of the
demand deposit or other transaction accounts of the Borrower with such Person
or, to the extent permitted under Applicable Law, with any of such Person's
Affiliates (whether maintained at a branch or office located within or without
the United States), with the Borrower remaining liable for any deficiency. The
Person so charging any such account shall give the Borrower prompt notice
thereof, but any failure to give or delay in giving such notice shall not
affect such Person's right to effect such charge.
(d) Extension of Payment Dates. Whenever any payment to the
Administrative Agent, the Issuing Bank, the Swing Loan Lender or any Bank under
the Borrower Loan Documents would otherwise be due (except by reason of
acceleration) on a day that is not a Business Day or, in the case of payments
of the principal of Eurodollar Rate Loans, a Eurodollar Business Day, such
payment shall instead be due on the next succeeding Business or Eurodollar
Business Day, as the case may be, unless, in the case of a payment of the
principal of Eurodollar Rate Loans, such extension would cause payment to be
due in the next succeeding calendar month, in which case such due date shall be
advanced to the next preceding Eurodollar Business Day. If the due date for
any payment under the Borrower Loan Documents is extended (whether by operation
of any Borrower Loan Document, Applicable Law or otherwise), such payment shall
bear interest for such extended time at the rate of interest applicable
hereunder.
Section 1.12. Distribution of Payments by the Administrative
Agent. (a) The Administrative Agent shall promptly distribute to the Issuing
Bank, the Swing Loan Lender and each Bank its ratable share of each payment
received by the Administrative Agent under the Loan Documents for the account
of the Issuing Bank, the Swing Loan Lender and the Banks by credit to an
account of such Bank, the Swing Loan Lender or the Issuing Bank at the
Administrative Agent's Office or by wire transfer to an account of such Bank,
the Swing Loan Lender or the Issuing Bank at an office of any other commercial
bank located in the United States or at any Federal Reserve Bank, in each case
as may be specified by such Bank.
(b) Unless the Administrative Agent shall have received
notice from the applicable Loan Party prior to the date on which any payment is
due to the Banks under the Loan Documents that such Loan Party will not make
such payment in full, the Administrative Agent may assume that such Loan Party
has made such payment in full to the Administrative Agent on such date and the
Administrative Agent in its sole discretion may, in reliance upon such
assumption, cause to be distributed to the Issuing Bank, the Swing Loan Lender
and each Bank on such due date a corresponding amount with respect to the
amount then due the Issuing Bank, the Swing Loan Lender and such Bank. If and
to the extent such Loan Party shall not have so made such payment in
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full to the Administrative Agent and the Administrative Agent shall have so
distributed to the Issuing Bank, the Swing Loan Lender or any Bank a
corresponding amount, the Issuing Bank, the Swing Loan Lender or such Bank
shall, on demand, repay to the Administrative Agent the amount so distributed
together with interest thereon, for each day from the date such amount is
distributed to the Issuing Bank, the Swing Loan Lender or such Bank until the
date the Issuing Bank, the Swing Loan Lender or such Bank repays such amount to
the Administrative Agent, at the Federal Funds Rate until (and including) the
third Business Day after demand is made and thereafter at the Base Rate.
Section 1.13. Taxes on Payments. (a) Taxes Payable by the
Borrower. If any Tax is required to be withheld or deducted from, or is
otherwise payable by the Borrower in connection with, any payment due to the
Issuing Bank, the Swing Loan Lender, any Bank or any Agent that is not a
"United States person" (as such term is defined in Section 7701(a)(30) of the
Code) hereunder, the Borrower (i) shall, if required, withhold or deduct the
amount of such Tax from such payment and, in any case, pay such Tax to the
appropriate taxing authority in accordance with Applicable Law and (ii) except
in the case of any Bank Tax, shall pay to the Issuing Bank, the Swing Loan
Lender, such Bank or Agent such additional amounts as may be necessary so that
the net amount received by the Issuing Bank, the Swing Loan Lender, such Bank
or Agent with respect to such payment, after withholding or deducting all Taxes
required to be withheld or deducted, is equal to the full amount payable
hereunder. If any Tax is withheld or deducted from, or is otherwise payable by
the Borrower in connection with, any payment due to the Issuing Bank, the Swing
Loan Lender, such Bank or Agent hereunder, the Borrower shall furnish to the
Issuing Bank, the Swing Loan Lender, such Bank or Agent the original or a
certified copy of a receipt (if any) for such Tax from the applicable taxing
authority or other evidence of payment thereof satisfactory to such Bank or
Agent within 30 days after the date of such payment (or, if such receipt shall
not have been made available by such taxing authority within such time, the
Borrower shall use reasonable efforts to promptly obtain and furnish such
receipt). If the Borrower fails to pay any such Taxes when due to the
appropriate taxing authority or fails to remit to the Issuing Bank, the Swing
Loan Lender, such Bank or Agent the required receipts or other evidence of
payment thereof satisfactory to such Bank or Agent, the Borrower shall
indemnify the Issuing Bank, the Swing Loan Lender, such Bank or Agent for any
Taxes, interest, penalties or additions to Tax that may become payable by the
Issuing Bank, the Swing Loan Lender, such Bank or Agent as a result of any such
failure.
(b) Taxes Payable by the Issuing Bank, any Bank or Agent.
The Borrower shall, promptly upon request by the Issuing Bank, the Swing Loan
Lender, any Bank or Agent that is not a United States person for the payment
thereof, pay to the Issuing Bank, the Swing Loan Lender, any such Bank or Agent
an amount
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equal to (i) all Taxes (other than Bank Taxes and without duplication of
amounts paid pursuant to Section 1.13(a)) payable by the Issuing Bank, the
Swing Loan Lender, such Bank or Agent with respect to any payment due to the
Issuing Bank, the Swing Loan Lender, such Bank or Agent hereunder and (ii) all
Taxes (other than Bank Taxes) payable by the Issuing Bank, the Swing Loan
Lender, such Bank or Agent as a result of payments made by the Borrower
(whether made to a taxing authority or to the Issuing Bank, the Swing Loan
Lender, such Bank or Agent) pursuant to Section 1.13(a) or this Section
1.13(b).
(c) Credits and Deductions. If the Issuing Bank, the Swing
Loan Lender, any Agent or Bank is, in its sole opinion, able to apply for any
refund, offset, credit, deduction or other reduction in Taxes by reason of any
payment made by the Borrower under Section 1.13(a) or (b), the Issuing Bank,
the Swing Loan Lender, such Agent or Bank, as the case may be, shall use
reasonable efforts to obtain such refund, offset, credit, deduction or other
reduction and, upon receipt thereof, will pay to the Borrower such amount, not
exceeding the increased amount paid by the Borrower, as is equal to the net
after-tax value to the Issuing Bank, the Swing Loan Lender, such Agent or Bank,
in its sole opinion, of such part of such refund, offset, credit, deduction or
other reduction as it considers to be allocable to such payment by the
Borrower, having regard to all of the Issuing Bank's, the Swing Loan Lender's,
such Agent's or Bank's dealings giving rise to similar refunds, offsets,
credits, deductions or other reductions in relation to the same tax period and
to the cost of obtaining the same; provided, however, that if the Issuing Bank,
the Swing Loan Lender, any Agent or Bank has made a payment to the Borrower
pursuant to this Section 1.13(c) and the applicable refund, offset, credit,
deduction or other reduction in Tax is subsequently disallowed, the Borrower
shall, promptly upon request by the Issuing Bank, the Swing Loan Lender, any
Agent or Bank, refund to the Issuing Bank, the Swing Loan Lender, such Agent or
Bank that portion of such payment determined by the Issuing Bank, the Swing
Loan Lender, such Agent or Bank, in its sole opinion, relating to such
disallowance; and provided, further that (i) the Issuing Bank, the Swing Loan
Lender, such Agent or Bank, as the case may be, shall not be obligated to
disclose to the Borrower any information regarding its Tax affairs or
computations and (ii) nothing in this Section 1.13(c) shall interfere with the
right of the Issuing Bank, the Swing Loan Lender, such Agent or Bank to arrange
its Tax affairs as it deems appropriate.
(d) Exemption from U.S. Withholding Taxes. (i) Each Bank
that is not a United States person shall submit to the Borrower and the
Administrative Agent, on or before the fifth day prior to the first Interest
Payment Date occurring after the Closing Date (or, in the case of a Person that
is not a United States person and that became a Bank by assignment, promptly
upon such assignment), two duly completed and signed copies of either (A) Form
1001 of the United States Internal Revenue Service
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entitling such Bank to a complete exemption from withholding on all amounts to
be received by such Bank pursuant to this Agreement and the Loans or (B) Form
4224 of the United States Internal Revenue Service relating to all amounts to
be received by such Bank pursuant to this Agreement and the Loans. Each such
Bank shall, from time to time after submitting either such Form, submit to the
Borrower and the Administrative Agent such additional duly completed and signed
copies of one or the other such Forms (or any successor forms as shall be
adopted from time to time by the relevant United States taxing authorities) as
may be (A) requested in writing by the Borrower or the Administrative Agent and
(B) appropriate under the circumstances and under then current United States
law or regulations to avoid or reduce United States withholding taxes on
payments in respect of all amounts to be received by such Bank pursuant to this
Agreement or the Loans. Upon the request of the Borrower or the Administrative
Agent, each Bank that is a United States person shall submit to the Borrower
and the Administrative Agent a certificate to the effect that it is a United
States person.
(ii) If any Bank determines that it is unable to submit
to the Borrower or the Administrative Agent any form or certificate that such
Bank is obligated to submit pursuant to the preceding paragraph, or that it is
required to withdraw or cancel any such form or certificate, or that any such
form or certificate previously submitted has otherwise become ineffective or
inaccurate, such Bank shall promptly notify the Borrower and the Administrative
Agent of such fact.
(iii) Notwithstanding anything to the contrary contained
herein, the Borrower shall not be required to pay any additional amount in
respect of United States withholding taxes pursuant to Section 1.13(a) or
Section 7.02 to any Bank that (A) is not, on the date this Agreement is
executed by such Bank (or, in the case of a Person that became a Bank by
assignment, on the date of such assignment), either (x) entitled to submit Form
1001 of the United States Internal Revenue Service entitling such Bank to a
complete exemption from withholding on all amounts to be received by such Bank
pursuant to this Agreement and the Loans or Form 4224 of the United States
Internal Revenue Service relating to all amounts to be received by such Bank
pursuant to this Agreement and the Loans or (y) a United States person, (B) is
no longer entitled or, in the case of a Bank that is no longer a United States
person, is not entitled, to submit either such Form (or any successor form as
shall be adopted from time to time by the relevant United States taxing
authorities) as a result of any change in circumstances or other event other
than a Regulatory Change or (C) with respect to any affected interest payments,
fails to fulfill its requirements set forth in Section 1.13(d)(i).
(iv) All references to any "Bank" contained in this
Section 1.13(d) shall be deemed to be a reference to, in addition
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to any Bank, the Issuing Bank, the Swing Loan Lender or any Agent.
Section 1.14. Evidence of Indebtedness. Each Bank's Loans
and the Borrower's obligation to repay such Loans with interest in accordance
with the terms of this Agreement shall be evidenced by this Agreement, the
records of such Bank and, in the case of Term A Loans, a single Term A Note
payable to the order of such Bank, in the case of Term B Loans, a single Term B
Note payable to the order of such Bank, in the case of RC Loans, a single RC
Note payable to the order of such Bank and, in the case of Working Capital
Loans, a single Working Capital Note payable to the order of such Bank. The
Swing Loans and the Borrower's obligation to repay the Swing Loans with
interest in accordance with the terms of this Agreement shall be evidenced by
this Agreement, the records of the Swing Loan Lender, and a single Swing Loan
Note payable to the order of the Swing Loan Lender. Each Bank's Letter of
Credit Participations shall be evidenced by this Agreement, the records of such
Bank and the Letters of Credit. The records of each Bank and the Swing Loan
Lender shall be prima facie evidence of such Bank's Loans and Letter of Credit
Participations, of the Swing Loan Lender's Swing Loans and, in each case, of
accrued interest thereon and all payments made in respect thereof.
Section 1.15. Pro Rata Treatment. Except to the extent
otherwise provided herein, (a) Loans (other than Swing Loans) shall be made by
the Banks pro rata in accordance with their respective Commitments, (b) Loans
of the Banks shall be converted and continued pro rata in accordance with their
respective amounts of Loans of the Type being so converted or continued, (c)
each reduction of the Total RC Commitment or the Total Working Capital
Commitment shall be applied to the RC Commitments or the Working Capital
Commitments, as the case may be, pro rata in accordance with the respective
amounts thereof and (d) each payment of the principal of or interest on the
Loans, reimbursement of Drawings under Letters of Credit or of commitment or
letter of credit fees shall be made for the account of the Banks and, if
applicable, the Issuing Bank or the Swing Loan Lender pro rata in accordance
with their respective amounts thereof then due and payable.
ARTICLE 2
CONDITIONS TO LOANS AND LETTERS OF CREDIT
Section 2.01. Conditions to Initial Loans or Letters of
Credit. The obligation of each Bank to make its initial Loan (or, if no Loans
have been made at such time, the obligation of the Issuing Bank to issue the
initial Letter of Credit) is subject to the Managing Agents' receipt of each of
the following, in form and substance and, in the case of the materials referred
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to in clause (f) below, certified in a manner satisfactory to the Managing
Agents:
(a) a certificate of the Secretary or an Assistant Secretary
or a Responsible Officer of each of the Transaction Parties, dated the
requested date for the making of such Loan or issuance of such Letter of
Credit, substantially in the form of Schedule 2.01(a), to which shall be
attached copies of the resolutions and by-laws referred to in such certificate;
(b) copies of the certificate of incorporation of each of the
Transaction Parties, in each case certified, as of a recent date, by the
Secretary of State or other appropriate official of the jurisdiction of
incorporation of such Transaction Party;
(c) a good standing certificate with respect to each
Transaction Party, issued as of a recent date by the Secretary of State or
other appropriate official of such Person's jurisdiction of incorporation,
together with a telegram from such Secretary of State or other official,
updating the information in such certificate;
(d) an opinion of counsel for the Borrower and an opinion of
counsel for each other Transaction Party, each dated the requested date for the
making of such Loan or the issuance of such Letter of Credit, in the form of
Schedules 2.01(d)-1 and 2.01(d)-2, respectively, with such changes as the
Managing Agents shall approve;
(e) an opinion of Winthrop, Stimson, Putnam & Roberts,
special counsel for the Managing Agents, dated the requested date for the
making of such Loan or the issuance of such Letter of Credit, in the form of
Schedule 2.01(e);
(f) except as set forth therein, a copy of each Governmental
Approval and other consent or approval listed on Schedule 3.03;
(g) a certificate of a Responsible Officer of the Borrower,
dated the requested date for the making of such Loan or issuance of such Letter
of Credit, with respect to the conditions set forth in Sections 2.02(b) and (c)
and setting forth the calculation of the Leverage Ratio in effect immediately
after giving effect to the making of the initial Loans and the application of
the proceeds thereof;
(h) a duly executed Term A Note for each Term A Bank, a duly
executed Term B Note for each Term B Bank, a duly executed RC Note for each RC
Bank, a duly executed Working Capital Note for each Working Capital Bank, a
duly executed Swing Note for the Swing Loan Lender and a duly executed copy of
each of the other Loan Documents;
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(i) such instruments and other documents as the Managing
Agents may request, the possession of which is necessary or appropriate in the
Managing Agents' determination to create or perfect a security interest in the
Collateral under Applicable Law, including but not limited to the certificates
representing the Pledged Securities, together with undated stock powers for
such certificates duly executed in blank, and duly executed UCC-1 financing
statements;
(j) evidence that, prior to or substantially simultaneously
with the making of such Loan, (i) the Predecessor Indebtedness will be repaid,
(ii) all commitments to lend in respect of the Predecessor Indebtedness shall
have been effectively terminated and (iii) all UCC-3 termination statements and
all other documents necessary in the determination of the Managing Agents to
effectively terminate of record all security interests related to the
Predecessor Indebtedness shall have been duly executed by the proper parties
and shall have been delivered to the Administrative Agent;
(k) a certificate of a Responsible Officer of Acquisition
Corp., dated the date of the making of the initial Tender Offer Loans, to which
shall be attached a pro forma balance sheet of and projections for the Borrower
and the Consolidated Subsidiaries reflecting the making of the initial Loans,
the application of the proceeds thereof and the consummation of the Merger and
the other transactions contemplated to occur at such time, including the
repayment of the Predecessor Indebtedness (including a pro forma balance sheet
as at a date satisfactory to the Managing Agents), which shall be in reasonable
detail and in form satisfactory to the Managing Agents;
(l) a certificate of the chief financial officer of the
Borrower, substantially in the form of Schedule 2.01(l), with respect to the
solvency, ability to pay debts and adequacy of capital of the Borrower after
giving effect to the making of the initial Loans, the application of the
proceeds thereof and the consummation of the Merger and the other transactions
contemplated to occur at such time;
(m) copies of the Tender Offer Documents, the Joint Ownership
and Management Agreements and the Merger Agreement, together with evidence
reasonably satisfactory to the Managing Agents that the Joint Ownership and
Management Agreements and the Merger Agreement remain in full force and effect
and that no default shall have occurred and be continuing thereunder;
(n) evidence reasonably satisfactory to the Managing Agents
that the Borrower shall have received a capital contribution of the amount of
cash as will enable the Borrower, when added to the proceeds of the initial
Loans hereunder, to consummate the Merger and to do so in compliance with
Regulations G, T, U and X;
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(o) evidence reasonably satisfactory to the Managing
Agents that all Governmental Approvals necessary in connection with the Merger
have been obtained and remain in full force and effect, and all applicable
waiting periods shall have expired without any action being taken by any
competent authority which restrains, prevents or imposes materially adverse
conditions upon the consummation of the Merger;
(p) evidence reasonably satisfactory to the Managing Agents
that all conditions to the consummation of the Merger provided for in the
Merger Agreement shall have been satisfied (unless waived with the consent of
the Managing Agents) to the reasonable satisfaction of the Managing Agents;
(q) evidence reasonably satisfactory to the Managing Agents
that there shall not exist any judgment, order, injunction or other restraint
prohibiting or imposing materially adverse conditions upon the consummation of
the Merger, and that no actions, suits or proceedings shall be pending or
threatened with respect to the Borrower or its Subsidiaries that could
reasonably be expected to (i) have a Materially Adverse Effect on the Borrower
and its Consolidated Subsidiaries, taken as a whole or (ii) have a Materially
Adverse Effect on the Merger, the rights and remedies of the Banks hereunder or
on the ability of the Borrower to perform its obligations hereunder;
(r) copies of all other agreements relating to the corporate
and capital structure of the Borrower and its Subsidiaries and all
organizational documents of the Borrower and its Subsidiaries, which structure,
agreements and documents shall be consistent with the provisions of Section
6.01(j), and evidence satisfactory to the Managing Agents that there shall
exist no options, warrants or other rights to acquire Capital Securities of the
Borrower or any of its Subsidiaries except for those owned by or in favor of
Comcast, Liberty or Barry Diller, or any of their respective Affiliates, or
owned by or in favor of other officers, directors or employees of QVC with
respect to an aggregate amount of common stock not in excess of 1,950,000
shares thereof, or those otherwise satisfactory to the Managing Agents;
(s) evidence reasonably satisfactory to the Managing Agents
that, except for changes affecting the cable television industry generally,
since the making of the Tender Offer Loans, no change in the business, assets,
Liabilities, financial condition or results of operations of the Borrower and
its Consolidated Subsidiaries, taken as a whole, has occurred, and no event has
occurred or failed to occur, that has had or could reasonably be foreseen as
having, either alone or in conjunction with all other such changes, events and
failures, a Materially Adverse Effect on the Borrower and its Consolidated
Subsidiaries, taken as a whole;
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(t) a duly executed copy of the Assumption Agreement; and
(u) evidence that the Borrower shall have paid all of the
fees and expenses required to be paid in connection herewith on the date of the
initial Loans or Letter of Credit.
Section 2.02. Conditions to Each Loan and Letter of Credit.
The obligation of each Bank to make each Loan requested to be made by it,
including its initial Loan, and the obligation of the Issuing Bank to issue
each Letter of Credit requested to be issued by it (including any request to
extend the expiry date of any Letter of Credit to a date beyond the first
anniversary of the issuance thereof), is subject to the fulfillment of each of
the following conditions:
(a) the Administrative Agent or, in the case of a Swing Loan,
the Swing Loan Lender, shall have received a notice of borrowing with respect
to such Loan complying with the requirements of Section 1.02 or, in the case of
a Swing Loan, a notice of borrowing complying with the requirements of Section
1.01(d)(i) or a notice of issuance with respect to such Letter of Credit
complying with the requirement of Section 1.03;
(b) each Loan Document Representation and Warranty shall be
true and correct in all material respects at and as of the time such Loan is to
be made or such Letter of Credit is to be issued, both with and without giving
effect to such Loan or Letter of Credit and all other Loans or Letters of
Credit to be made or issued at such time and to the application of the proceeds
thereof, except, in the case of Loans and Letters of Credit other than the
initial Loans or Letters of Credit, to the extent waived by the Required Banks;
(c) no Default (other than a Default that shall have been
waived by the Required Banks) shall have occurred and be continuing at the time
such Loan is to be made or such Letter of Credit is to be issued or would
result from the making of such Loan or the issuance of such Letter of Credit
and all other Loans and Letters of Credit to be made or issued at such time or
from the application of the proceeds thereof;
(d) in the case of any such Letter of Credit, the Issuing
Bank shall have received such other instruments and agreements relating thereto
as the Issuing Bank shall have reasonably requested; and
(e) in the case of any such Loan, such Loan will not
contravene any Applicable Law applicable to such Bank, including Regulation U.
Except to the extent that the Borrower shall have disclosed in
the notice of borrowing, or in a subsequent notice given to the Banks prior to
5:00 p.m. (New York time) on the
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Business Day before the requested date for the making of the requested Loans or
the issuance of the requested Letter of Credit, that a condition specified in
Section 2.02(b) or (c) will not be fulfilled as of the requested time for the
making of such Loans, the Borrower shall be deemed to have made a
Representation and Warranty as of the time of the making of such Loans or
issuance of such Letter of Credit that the conditions specified in such clauses
have been fulfilled as of such time. No such disclosure by the Borrower that a
condition specified in Section 2.02(b) or (c) will not be fulfilled as of the
requested time for the making of the requested Loans shall affect the right of
each Bank to not make the Loans requested to be made by it or of the Issuing
Bank not to issue the Letter of Credit requested to be issued by it if such
condition has not been fulfilled at such time.
ARTICLE 3
CERTAIN REPRESENTATIONS AND WARRANTIES
In order to induce each Agent, each Bank, the Swing Loan
Lender and the Issuing Bank to enter into this Agreement and to make each Loan
or issue each Letter of Credit requested to be made or issued by it, the
Borrower represents and warrants as follows:
Section 3.01. Organization; Power; Qualification. Each of
the Borrower and the Subsidiaries is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation, has full corporate power and authority to own its properties and
to carry on its business as now being and hereafter proposed to be conducted
and is duly qualified and in good standing as a foreign corporation, and is
authorized to do business, in all jurisdictions in which the character of its
properties or the nature of its business requires such qualification or
authorization, except for qualifications and authorizations the lack of which,
singly or in the aggregate, has not had and is not reasonably likely to have a
Materially Adverse Effect on (a) the Borrower and the Consolidated Subsidiaries
taken as a whole, (b) any Material Loan Document or (c) the Collateral.
Section 3.02. Capitalization; Subsidiaries. Schedule 3.02
sets forth, immediately after consummation of the Merger, (a) all of the
Capital Securities of the Borrower and the Persons owning such Capital
Securities, the jurisdictions of organization of such Persons (other than
individuals) and the percentages of such Capital Securities so owned and (b)
all of the Subsidiaries, their jurisdictions of incorporation and the
percentages of the various classes of their Capital Securities owned by the
Borrower or another Subsidiary and indicates which Subsidiaries are
Consolidated Subsidiaries. The Borrower or another Subsidiary, as the case may
be, has the unrestricted right to vote, and
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(subject to limitations imposed by Applicable Law) to receive dividends and
distributions on, all Capital Securities of the Subsidiaries indicated on
Schedule 3.02 as owned by the Borrower or such Subsidiary, other than any such
Capital Securities sold, transferred or otherwise disposed of, or canceled,
terminated or extinguished, pursuant to a transaction otherwise permitted
hereunder. All such Capital Securities have been duly authorized and issued
and are fully paid and nonassessable.
Section 3.03. Authorization; Enforceability; Required
Consents; Absence of Conflicts. Each of the Borrower and the Loan Parties has
the power, and has taken all necessary action (including, if a corporation, any
necessary stockholder action) to authorize it, to execute, deliver and perform
in accordance with their respective terms the Loan Documents to which it is a
party and, in the case of the Borrower, to borrow hereunder in the amount of
the unused Total Term A Commitment, Total Term B Commitment, Total RC
Commitment and Total Working Capital Commitment. This Agreement has been, and
each of the other Loan Documents to which the Borrower is a party when
delivered to the Administrative Agent will have been, duly executed and
delivered by the Borrower and is, or when so delivered will be, a legal, valid
and binding obligation of the Borrower, enforceable against the Borrower in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and equitable principles of general application.
The execution, delivery and performance in accordance with their respective
terms by the Borrower of the Loan Documents to which it is a party, and each
borrowing hereunder, whether or not in the amount of the unused Total Term A
Commitment, Total Term B Commitment, Total RC Commitment and Total Working
Capital Commitment, and the transactions contemplated by the Merger Agreement,
including the Tender Offer and the Merger, do not and (absent any change in any
Applicable Law or applicable Contract) will not (a) require any Governmental
Approval or any other consent or approval, including any consent or approval of
any Subsidiary or any consent or approval of the stockholders of the Borrower
or any Subsidiary, other than Governmental Approvals and other consents and
approvals that have been obtained, are in full force and effect and are final
and, in the case of Governmental Approvals, not subject to review on appeal or
to collateral attack or, with respect to the transactions contemplated by the
Merger Agreement, the absence of which could not reasonably be expected to have
a Materially Adverse Effect on (i) the Borrower and the Consolidated
Subsidiaries taken as a whole, (ii) any Material Loan Document or (iii) the
Collateral, and, in the case of any such Governmental Approval or other consent
or approval required under any Applicable Law or Contract as in effect on the
Agreement Date, are listed on Schedule 3.03 or (b) violate, conflict with,
result in a breach of, constitute a default under, or result in or require the
creation of any Lien upon any assets of the Borrower or any Subsidiary under,
(i) any Contract to which the Borrower or any Subsidiary is a party or by which
the
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Borrower or any Subsidiary or any of their respective properties may be bound
or (ii) any Applicable Law, except for such violations, breaches or defaults of
or under Contracts or Applicable Law (A) so long as, in the case of any
Contract, such Contract is not expressly identified or contemplated herein or
in any other Loan Document, and no Loan Party is party thereto, or, in the case
of Applicable Law, such Applicable Law is not applicable to the Borrower, (B)
that could not reasonably be expected to expose any Agent or Bank to any
liability, loss, cost or expense and (C) that, either alone or in conjunction
with all other such violations, breaches or defaults, could not have a
Materially Adverse Effect on (x) the Borrower and the Consolidated Subsidiaries
taken as a whole, (y) any Material Loan Document or (z) the Collateral.
Section 3.04. Litigation. Except as set forth on Schedule
3.04, there are not, in any court or before any arbitrator of any kind or
before or by any governmental or non-governmental body, any actions, suits or
proceedings pending or, to the knowledge of the Borrower and the Subsidiaries,
threatened against or in any other way relating to or affecting (i) the
Borrower or any Subsidiary or any of their respective businesses or properties,
(ii) any Material Loan Document to which the Borrower or any Subsidiary is a
party or (iii) the Collateral (except actions, suits or proceedings that may
affect the cable television industry generally but with respect to which
neither the Borrower nor any Subsidiary nor any other Loan Party is a party)
with respect to which there is a reasonable probability of a determination
adverse to the interests of the Borrower or any Subsidiary that, if adversely
determined, would, singly or in the aggregate, have a Materially Adverse Effect
on (A) the Borrower and the Consolidated Subsidiaries taken as a whole, (B) any
Material Loan Document or (C) the Collateral.
Section 3.05. Burdensome Provisions. As of the Agreement
Date and as of the Closing Date, neither the Borrower nor any Subsidiary is a
party to or bound by any Contract or Applicable Law (other than Applicable Law
affecting the cable television industry generally), compliance with which could
reasonably be expected to have a Materially Adverse Effect on (a) the Borrower
and the Consolidated Subsidiaries taken as a whole, (b) any Material Loan
Document or (c) the Collateral.
Section 3.06. No Adverse Change or Event. Except for events
affecting the cable television industry generally, since the date of the making
of the initial Tender Offer Loans, no change in the business, assets,
Liabilities, financial condition or results of operations of the Borrower or
any Subsidiary has occurred, and no event has occurred or, in the case of
events anticipated by the Borrower to have occurred prior to the making of this
representation and warranty, failed to occur, that has had or could reasonably
be expected to have, either alone or in conjunction with all other such
changes, events and failures, a Materially Adverse Effect on (a) the Borrower
and the
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Consolidated Subsidiaries taken as a whole, (b) any Material Loan Document or
(c) the Collateral. Such an adverse change may have occurred, and such an
event may have occurred or failed to occur, within the meaning of this Section
3.06 at any particular time without regard to whether such change, event or
failure constitutes a Default or whether any other Default shall have occurred
and be continuing.
Section 3.07. Taxes. Each of the Borrower and the
Subsidiaries has filed (either directly or indirectly through the Affiliate of
the Borrower or such Subsidiary responsible (whether as common parent or agent
of a filing group or otherwise) under Applicable Law for such filing) all
United States Federal income tax returns and all other material Tax returns
that are required to be filed by such Person and have paid (either directly or
indirectly through the Affiliate of the Borrower or such Subsidiary responsible
(whether as common parent or agent of a filing group or otherwise) under
Applicable Law for such payment) all Taxes due pursuant to such returns or
pursuant to any assessment received by the Borrower or any of its Affiliates
and relating to the Borrower or any Subsidiary, except (i) such Taxes, if any,
as are being contested in good faith by appropriate proceedings, if any, and as
to which reserves have been provided to the extent required by Generally
Accepted Accounting Principles and (ii) such tax returns and Taxes the failure
to file or pay which could not reasonably be expected to have a Materially
Adverse Effect on (A) the Borrower and the Consolidated Subsidiaries taken as a
whole, (B) any Material Loan Document or (C) the Collateral. There is
currently in effect no tax sharing, tax allocation or similar agreement to
which the Borrower or any Subsidiary is a party, other than the First Amended
and Restated Joint Venture Agreement dated as of February 1, 1995 among QVC,
QVC Britain, British Sky Broadcasting Limited, Precis (1192) and QVC, an
English unlimited liability company.
Section 3.08. No Default. Neither the Borrower nor any of
the Subsidiaries is in default in the payment or performance or observance of
any Contract to which it is a party or by which it or its properties or assets
may be bound that, individually or together with all other such defaults, could
have a Materially Adverse Effect on (a) the Borrower and the Consolidated
Subsidiaries taken as a whole, (b) any Material Loan Document or (c) the
Collateral.
Section 3.09. Not an Investment Company. Neither the
Borrower nor any of the Subsidiaries is an "investment company" within the
meaning of the Investment Company Act of 1940.
Section 3.10. Hazardous Materials. The Borrower and each of
the Subsidiaries have obtained all permits, licenses and other authorizations
which are required under all Environmental Laws, except to the extent failure
to have any such permit, license or authorization would not reasonably be
expected to have a Materially Adverse Effect on (a) the Borrower and the
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Consolidated Subsidiaries taken as a whole, (b) any Material Loan Document or
(c) the Collateral. The Borrower and each of the Subsidiaries are in
compliance with the terms and conditions of all such permits, licenses and
authorizations, and are also in compliance with all other limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in any applicable Environmental Law or in
any regulation, code, plan, order, decree, judgment, injunction, notice or
demand letter issued, entered, promulgated or approved thereunder, except to
the extent failure to comply would not reasonably be expected to have a
Materially Adverse Effect on (i) the Borrower and the Consolidated Subsidiaries
taken as a whole, (ii) any Material Loan Document or (iii) the Collateral. In
addition, to the knowledge of the Borrower, no notice, notification, demand,
request for information, citation, summons or order has been issued, no
complaint has been filed, no penalty has been assessed and no investigation or
review is pending or threatened by any governmental or other entity with
respect to any alleged failure by the Borrower or any of the Subsidiaries to
have any permit, license or authorization required in connection with the
conduct of the business of the Borrower or any of the Subsidiaries or with
respect to any generation, treatment, storage, recycling, transportation,
discharge, disposal or "release" (as such term is defined in 42 U.S.C. Section
9601(22)) of Hazardous Materials generated by the Borrower or any of the
Subsidiaries, the consequences of any of which would not reasonably be expect
to have a Materially Adverse Effect on (x) the Borrower and the Consolidated
Subsidiaries taken as a whole, (y) any Material Loan Document or (z) the
Collateral.
Section 3.11. Solvency. As of the Closing Date, and after
giving effect to the making of the initial Loans and the application of the
proceeds thereof (a) the Fair Saleable Value of the assets of the Borrower
exceeds the amount that will be required to be paid on or in respect of the
existing debts and other liabilities (including contingent liabilities) of the
Borrower, as such debts and liabilities become absolute and mature, (b) the
property of the Borrower does not constitute unreasonably small capital for it
to carry on its business as now conducted and as proposed to be conducted,
including the capital needs of the Borrower, taking into account the particular
capital requirements of the business conducted by it and projected capital
requirements and capital availability and (c) the Borrower does not intend to
incur debts or liabilities beyond its ability to pay such debts and liabilities
as they mature, taking into account the timing and amounts of cash to be
received by it and of amounts to be payable on or in respect of debts and
liabilities of it. The Borrower believes that its cash flow, after taking into
account all anticipated uses of its cash, will at all times be sufficient to
pay all such amounts on or in respect of debt and liabilities of the Borrower
when such amounts are scheduled to be paid. For purposes of this Section 3.11,
"Fair Saleable Value" means, with respect to any asset at any time, the amount
that a willing buyer would pay a willing seller
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for such asset on the assumption that the sale of such asset must take place
within a reasonable period after such time.
Section 3.12. Senior Debt. The obligations of the Borrower
under the Borrower Loan Documents and under any Interest Rate Protection
Agreement entered into with any Bank constitute "Senior Debt" within the
meaning and pursuant to the terms of the Affiliate Subordination Agreement.
Section 3.13. Benefit Plans. As of the Agreement Date,
neither the Borrower nor any Subsidiary has any Benefit Plans other than
Existing Benefit Plans.
Section 3.14. Security Interest. The Security Interest
constitutes a valid and perfected security interest in the Collateral, which is
subject to no other Lien except for Permitted Liens.
ARTICLE 4
CERTAIN COVENANTS
From the Agreement Date until the Repayment Date,
A. The Borrower shall and shall cause each Subsidiary to:
Section 4.01. Preservation of Existence and Properties, Scope
of Business, Compliance with Law, Payment of Taxes and Claims, Preservation of
Enforceability. (a) Except for transactions to which Sections 4.07 and 4.08
hereof are by their express terms inapplicable, preserve and maintain its
corporate existence and all of its other franchises, licenses, rights and
privileges, (b) preserve, protect and obtain all Intellectual Property, and
preserve and maintain in good repair, working order and condition all other
properties, required for the conduct of its business, (c) comply with
Applicable Law, (d) pay or discharge when due all Taxes and all Liabilities
that might become a Lien on any of its properties and (e) take all action and
obtain all consents and Governmental Approvals required so that its obligations
under the Loan Documents will at all times be legal, valid and binding and
enforceable in accordance with their respective terms, except that this Section
4.01 (other than clause (a) above (insofar as it requires any Loan Party to
preserve its corporate existence) and clause (e) above) shall not apply in any
circumstance where noncompliance, together with all other noncompliances with
this Section 4.01, will not have a Materially Adverse Effect on (i) the
Borrower and the Consolidated Subsidiaries taken as a whole, (ii) any Material
Loan Document or (iii) the Collateral.
Section 4.02. Insurance. Maintain insurance with responsible
insurance companies against at least such risks and in at least such amounts
(a) as is customarily maintained by
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similar businesses or (b) as may be required by Applicable Law, except, in the
case of clause (b) above, to the extent that the failure to maintain such
insurance could not have a Materially Adverse Effect on (i) the Borrower and
the Consolidated Subsidiaries taken as a whole, (ii) any Material Loan Document
or (iii) the Collateral. Whether or not customarily maintained by similar
businesses, the Borrower shall, and shall cause the Subsidiaries to, maintain
business interruption insurance.
Section 4.03. Use of Proceeds. (a) Use the proceeds of the
Loans only to (i) repay in full the Predecessor Indebtedness and any accrued
and unpaid interest and fees related thereto, (ii) pay transaction costs in
connection herewith, (iii) pay amounts due and payable pursuant to the Merger
Agreement, and pay any related fees and transaction costs, and (iv) fund
working capital and capital expenditure requirements and other general
corporate purposes, and (b) use the Letters of Credit only for the purpose
specified in Section 1.03(c). None of the proceeds of any of the Loans shall
be used to purchase or carry, or to reduce or retire or refinance any credit
incurred to purchase or carry, any margin stock (within the meaning of
Regulations U and X) or to extend credit to others for the purpose of
purchasing or carrying any margin stock, in any such case in violation of
Regulation U. If requested by any Bank, the Borrower shall complete and sign
Part I of a copy of Federal Reserve Form U-1 referred to in Regulation U and
deliver such copy to such Bank.
B. The Borrower shall not, and shall not permit or suffer any
Subsidiary to, directly or indirectly:
Section 4.04. Guaranties. Be obligated, at any time, in
respect of any Guaranty, except that this Section 4.04 shall not apply to (a)
Existing Guaranties, (b) Permitted Guaranties or and (c) other Guaranties of
obligations which do not constitute Indebtedness and which are in an aggregate
amount not in excess of $5,000,000 for any fiscal year of the Borrower.
Section 4.05. Liens. Permit to exist, at any time, any Lien
upon any of its properties or assets of any character, whether now owned or
hereafter acquired, or upon any income or profits therefrom, except that this
Section 4.05 shall not apply to Permitted Liens; provided, however, that if,
notwithstanding this Section 4.05, any Lien prohibited by this Section 4.05
shall be created or arise, the Liabilities of the Loan Parties under the Loan
Documents shall, to the extent such Lien attaches to any asset that does not
constitute Collateral or to any asset with respect to which such Lien would be
prior to the Security Interest, automatically be secured by such Lien to the
full extent permitted by Applicable Law equally and ratably with the other
Liabilities secured thereby, and the holder of such other Liabilities, by
accepting such Lien, shall, to such extent, be deemed to have agreed thereto
and to share with the Banks, on that basis, the proceeds of such Lien, whether
or not the Banks'
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security interest shall be perfected; provided further, however, that
notwithstanding such equal and ratable securing and sharing, the existence of
such Lien shall constitute a default by the Borrower in the performance or
observance of this Section 4.05.
Section 4.06. Restricted Payments. Make or declare or
otherwise become obligated to make any Restricted Payment, except that, so long
as, at both the time of any such Restricted Payment and immediately after
giving effect thereto, no Default shall have occurred and be continuing, this
Section 4.06 shall not apply to (a) any Restricted Payment made after the
receipt by the Administrative Agent of the financial statements and other
materials required to be delivered under Section 5.01(b) for the fiscal year
ended January 31, 1998 and each fiscal year thereafter, in an amount, together
with the amount of all other Restricted Payments made with respect to such
fiscal year pursuant to this Section 4.06(a), not in excess of 50% of Excess
Cash Flow for such fiscal year, less the portion, if any, of Excess Cash Flow
for such fiscal year used to make acquisitions or investments pursuant to
Sections 4.07(f)(ii)(A) and 4.14(m)(ii)(A), respectively, so long as, in all
such cases, (i) no Default under Section 4.15, 4.16, 4.17 or 4.18 shall have
occurred at any time during the most recently ended two fiscal quarters of the
Borrower that shall have been cured pursuant to Section 6.03 hereof and (ii)
the Borrower shall have made the prepayment, if any, required to be made
pursuant to Section 1.06(b)(i) with respect to such Excess Cash Flow for such
fiscal year, or (b) any Restricted Payment paid to Holdco in an amount equal to
the amount of cash debt service payments required to be made at such time
pursuant to the terms of any Permitted Holdco Replacement Debt.
Section 4.07. Merger or Consolidation; Acquisitions. Merge
or consolidate with any Person, or acquire substantially all the assets or any
business, business unit or division from or substantially all the Capital
Securities of any Person, except that, if after giving effect thereto no
Default would exist, this Section 4.07 shall not apply to (a) the Merger, (b)
any merger or consolidation of the Borrower with any one or more Wholly Owned
Subsidiaries, provided that the Borrower shall be the continuing Person, (c)
any merger or consolidation of any Subsidiary with any one or more other
Subsidiaries so long as the continuing Person is a Wholly-Owned Subsidiary, and
so long as, if such Subsidiary is a Loan Party, such Subsidiary shall be the
continuing Person unless the other Subsidiary is also a Loan Party and it is
the continuing Person, or the continuing Person shall have assumed the
obligations of the Loan Party under the Loan Documents in a manner satisfactory
to the Managing Agents, provided that any consideration paid to minority
shareholders of any such Subsidiary shall be considered an acquisition made
pursuant to Section 4.07(f), and shall comply with the provisions of such
subsection, (d) any merger or consolidation of any Subsidiary that is not a
Material Subsidiary into any one or more other Subsidiaries that are not
Material Subsidiaries, so long as
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the continuing Person is not a Material Subsidiary, (e) any investment that is
contemplated by Section 4.14 (other than under clause (i) thereof) and (f) any
other acquisition, so long as the purchase price of all such acquisitions
contemplated by this Section 4.07(f), together with all investments
contemplated by Section 4.14(m), is not in excess of the sum of (i) (A) if at
the time of such acquisition the Leverage Ratio is greater than 3.50 to 1, (x)
$30,000,000 in any fiscal year of the Borrower plus, in any fiscal year of the
Borrower after the fiscal year ending January 31, 1996, the lesser of (1) the
difference between $30,000,000 and the aggregate purchase price of all such
acquisitions and investments made in the previous fiscal year of the Borrower
and (2) $10,000,000, and (y) $90,000,000 in the aggregate for all such
acquisitions and investments or (B) if at the time of such acquisition the
Leverage Ratio is less than or equal to 3.50 to 1, $160,000,000 in the
aggregate for all such acquisitions and investments and (ii) the sum of (A) the
amount of any Restricted Payment that the Borrower would be permitted to make
at such time pursuant to, and subject to the terms and conditions of, Section
4.06(a) but that has in fact not been made and (B) if at the time of such
acquisition the Leverage Ratio is less than or equal to 3.50 to 1, 50% of
Excess Cash Flow for all preceding fiscal years of the Borrower (commencing
with the fiscal year ending January 31, 1996) on the last days of which the
Leverage Ratio was less than or equal to 3.50 to 1.
Section 4.08. Disposition of Assets. Sell, lease, license,
transfer or otherwise dispose of any asset or any interest therein, except that
this Section 4.08 shall not apply to (a) any disposition of inventory in the
ordinary course of business, (b) any disposition of any obsolete or retired
property not used or useful in its business, (c) any disposition of any asset
or any interest therein by a Subsidiary to the Borrower or a Wholly Owned
Subsidiary or any disposition of any asset or any interest therein by the
Borrower to a Wholly Owned Subsidiary, (d) any sale or assignment of delinquent
accounts receivable or other trade receivables (or notes evidencing such
receivables) to a collection agency or similar service in the ordinary course
of business, (e) any sale of credit card receivables pursuant to a Permitted
Receivables Program, (f) any transaction to which any of the other provisions
of this Agreement (other than Section 4.10) is by its express terms
inapplicable, (g) licenses of intellectual property and computer software in
the ordinary course of business and (h) any other disposition of (i) any
Subsidiary that is not, or any asset of any Subsidiary that is not, a Material
Subsidiary at the time of such disposition and (ii) any other asset, the fair
market value or sale price of which (whichever is greater), together with the
fair market value or sale price (whichever is greater) of all other assets sold
or disposed of pursuant to this Section 4.08(h)(ii), is not in excess of
$75,000,000.
Section 4.09. Indebtedness. Incur, create, assume or suffer
to exist any Indebtedness, except that this Section 4.09
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shall not apply to (a) Indebtedness under the Loan Documents, (b) Junior
Subordinated Indebtedness, (c) Permitted Mortgage Indebtedness, (d) Permitted
Borrower Replacement Debt, (e) Indebtedness to which Section 4.14 is by its
express terms inapplicable by virtue of clause (h) thereof, (f) Indebtedness
arising under a Permitted Receivables Program and (g) other Indebtedness in an
aggregate principal amount at any time not in excess of (i) so long as the
Leverage Ratio is greater than 4.00 to 1, $30,000,000 and (ii) so long as the
Leverage Ratio is less than or equal to 4.00 to 1, $50,000,000.
Section 4.10. Transactions with Affiliates. Effect any
transaction with any Affiliate (other than the Borrower or any Subsidiary) on a
basis less favorable than would at the time be obtainable for a comparable
transaction in arms-length dealing with an unrelated third party, except that
this Section 4.10 shall not apply to (a) transactions to which this Agreement
is by its express terms inapplicable, (b) the Shareholders Agreement, (c) the
Merger Agreement, (d) the affiliation agreements contemplated by Section 4.21
and (e) the waiver by the Borrower of "Company Repurchase Rights," as
contemplated by Section 1 of the Joint Bidding Agreement.
Section 4.11. Management Fees. (a) Make payments or accrue
obligations to any Person for the supervision and management of the Borrower
and the Subsidiaries other than Management Fees, and (b) make payments in
respect of, or accrue, Management Fees at any time other than Permitted
Management Fees. For purposes of this Agreement, "Permitted Management Fees"
means, at any time during any fiscal year of the Borrower, (i) Management Fees
in an amount equal to 4% of Total Revenue at such time, which may be paid in
cash or accrued to the extent not currently paid in cash as provided below, and
(ii) the accrued and unpaid portion of Management Fees from prior fiscal years,
commencing with the fiscal year in which the Closing Date shall have occurred.
Notwithstanding the foregoing, Permitted Management Fees shall not be paid in
cash (i) prior to January 31, 1998, (ii) at any time a Default exists or,
immediately after giving effect thereto, would exist or (iii) if the amount of
such payment, together with the aggregate amount of all other payments of
Management Fees made during the same fiscal quarter of the Borrower, would, if
deducted from Cash Flow at such time, result in the Leverage Ratio, the Fixed
Charge Coverage Ratio, the Interest Coverage Ratio or the Pro Forma Debt
Service Ratio at such time being in an amount that does not comply with the
requirements at such time of Section 4.15, 4.16, 4.17 or 4.18, as applicable.
For purposes of this Section 4.11, "Total Revenue" means, at any time during
any fiscal year of the Borrower, consolidated net sales of the Borrower and the
Subsidiaries during the period commencing with the first day of such fiscal
year and ending at such time.
Section 4.12. Limitation on Restrictive Covenants. Permit to
exist, at any time, any consensual restriction limiting
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the ability (whether by covenant, event of default, subordination or otherwise)
of any Subsidiary to (a) pay dividends or make any other distributions on
shares of its Capital Securities held by the Borrower or any other Subsidiary,
(b) pay any obligation owed to the Borrower or any other Subsidiary, (c) make
any loans or advances to or investments in the Borrower or in any other
Subsidiary, (d) transfer any of its property or assets (other than property or
assets subject to Permitted Liens) to the Borrower or any other Subsidiary,
except for contracts, leases or licenses which by their terms are
non-assignable or (e) create any Lien upon its property or assets (other than
property or assets subject to Permitted Liens) whether now owned or hereafter
acquired or upon any income or profits therefrom (other than contracts, leases
or other licenses which by their terms may not be pledged or otherwise
encumbered), except that this Section 4.12 shall not apply to Permitted
Restrictive Covenants.
Section 4.13. Issuance or Disposition of Capital Securities.
Issue any of its Capital Securities or sell, transfer or otherwise dispose of
any Capital Securities of any Subsidiary, except that this Section 4.13 shall
not apply to (a) any issuance by a Subsidiary of any of its Capital Securities
to the Borrower or a Wholly Owned Subsidiary, (b) any issuance by a Subsidiary
of any of its Capital Securities to the holders of the common stock or other
ownership interests of such Subsidiary made pro rata to the relative amounts of
such common stock or other ownership interests, respectively, held by such
holder, (c) any disposition by the Borrower or any Subsidiary of any Capital
Securities of a Subsidiary to the Borrower or a Wholly Owned Subsidiary, (d)
any disposition of Capital Securities of any Subsidiary pursuant to Section
4.08(h) or in consideration of the acquisition of an investment pursuant to
Section 4.14, (e) any issuance by the Borrower of its Capital Securities so
long as such issuance shall not constitute or result in an Event of Default
under Section 6.01(j) and so long as any such Capital Securities so issued are
subject to the Security Interest and (f) prior to the formation of Holdco, any
issuance by the Borrower of its Capital Securities to any of its officers,
directors and other employees, so long as such issuance shall not constitute or
result in an Event of Default under Section 6.01(j) and so long as (i) if the
Leverage Ratio at the time of such issuance is less than or equal to 4.50 to 1,
such Capital Securities, together with all other Capital Securities issued
pursuant to this Section 4.13(f), constitute no more than 2.5% of the total
equity value of the Borrower, (ii) if the Leverage Ratio at the time of such
issuance is less than or equal to 4.00 to 1, such Capital Securities, together
with all other Capital Securities issued pursuant to this Section 4.13(f),
constitute no more than 5.0% of the total equity value of the Borrower, or
(iii) if the Leverage Ratio at the time of such issuance is less than or equal
to 3.25 to 1, such Capital Securities, together with all other Capital
Securities issued pursuant to this Section 4.13(f), constitute no more than
10.0% of the total equity value of the Borrower.
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Section 4.14. Investments. Purchase or acquire obligations
or Capital Securities of, or any other interest in, or make loans to, or
otherwise enter into joint venture or similar arrangements with, any Person,
except that this Section 4.14 shall not apply to any such obligation, Capital
Security, interest, loan or arrangement consisting of (a) obligations issued or
guaranteed by the United States of America with a remaining maturity not
exceeding one year, (b) commercial paper with maturities of not more than 270
days and a published rating of not less than A-1 by Standard & Poor's Ratings
Group ("S&P") or P-1 by Moody's Investors Service, Inc. ("Moody's") (or the
equivalent rating), (c) certificates of time deposit and bankers' acceptances
having maturities of not more than one year of any Bank or other commercial
bank if (i) such other bank has a combined capital and surplus of at least
$100,000,000 and (ii) its unsecured long-term debt obligations, or those of a
holding company of which it is a Subsidiary, are rated not less than A- or A3
(or the equivalent rating) by a nationally recognized investment rating agency,
(d) repurchase agreements with any Bank for periods not in excess of 180 days
fully collateralized by securities constituting obligations issued or
guaranteed by the United States of America, (e) notes and other instruments
that are exempt from Federal income taxation with a remaining maturity not
exceeding one year, provided that such notes and other instruments are rated in
the highest safety category (MIG1 or equivalent) by Moody's or S&P, (f)
purchases of foreign currencies in amounts not in excess of anticipated
purchases from foreign suppliers and other anticipated expenses incurred in
such currencies, and investments thereof in instruments, loans or arrangements
generally considered to be cash equivalents in the home country of such
currencies, pending the funding of such purchases and expenses, (g) advances
and loans to officers, directors and other employees in an aggregate amount not
in excess of $2,000,000 at any time, (h) stock or interests in, loans or
advances to, or transfers of assets to, the Borrower or any of the Consolidated
Subsidiaries, provided that no such loans or advances to a Consolidated
Subsidiary shall remain outstanding after any sale, exchange or disposition of
such Subsidiary, (i) acquisitions referred to in Section 4.07, (j) Interest
Rate Protection Agreements having a designated notional amount not exceeding,
at the time entered into, 100% of the Total Term A Commitment, Total Term B
Commitment, Total RC Commitment and Total Working Capital Commitment then in
effect, having a maturity not later than the RC Maturity Date and that provide
for regularly scheduled net settlement payments based upon nominal interest
amounts computed on the basis of fixed or floating rates of interest, (k)
Existing Investments, (l) foreign currency exchange agreements, exchange rate
hedging arrangements or other agreements or arrangements entered into by the
Borrower in the ordinary course of business in order to protect the Borrower or
any Subsidiary against fluctuations in currency rates and (m) other
investments, including investments in international joint ventures, at any time
owned by the Borrower and the Subsidiaries and acquired for a purchase price
not in excess of, together with
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the purchase price of all other such investments acquired pursuant to this
Section 4.14(m) and all acquisitions permitted pursuant to Section 4.07(f), the
sum of (i) (A) if at the time of such investment the Leverage Ratio is greater
than 3.50 to 1, (x) $30,000,000 in any fiscal year of the Borrower plus, in any
fiscal year of the Borrower after the fiscal year ending January 31, 1996, the
lesser of (1) the difference between $30,000,000 and the aggregate purchase
price of all such acquisitions and investments made in the previous fiscal year
of the Borrower and (2) $10,000,000, and (y) $90,000,000 in the aggregate for
all such acquisitions and investments or (B) if at the time of such investment
the Leverage Ratio is less than or equal to 3.50 to 1, $160,000,000 in the
aggregate for all such acquisitions and investments and (ii) the sum of (A) the
amount of any Restricted Payment that the Borrower would be permitted to make
at such time pursuant to, and subject to the terms and conditions of, Section
4.06(a) but that has in fact not been made and (B) if at the time of such
investment the Leverage Ratio is less than or equal to 3.50 to 1, 50% of Excess
Cash Flow for all preceding fiscal years of the Borrower (commencing with the
fiscal year ending January 31, 1996) on which the last days of which the
Leverage Ratio was less than or equal to 3.50 to 1.
C. The Borrower shall not:
Section 4.15. Leverage Ratio. Permit the Leverage Ratio to
be greater than the following respective amounts at any time during the
following respective periods:
<TABLE>
<CAPTION>
Leverage
Period Ratio
------ --------
<S> <C>
Closing Date through April 30, 1996 5.50 to 1
May 1, 1996 through October 31, 1996 5.00 to 1
November 1, 1996 through April 30, 1997 4.75 to 1
May 1, 1997 through April 30, 1998 4.50 to 1
May 1, 1998 through April 30, 1999 4.00 to 1
May 1, 1999 and thereafter 3.50 to 1
</TABLE>
; provided, however, that if the Borrower shall have made an acquisition
pursuant to Section 4.07(f)(i)(B) or (ii)(B), or an investment pursuant to
Section 4.14(m)(i)(B) or (ii)(B), at any time prior to May 1, 1999, the
Borrower shall not permit the Leverage Ratio to be greater than 3.75 to 1 at
any time from the date of the making of such acquisition or investment through
April 30, 1999; provided further, however, that if the Borrower issues any of
its Capital Securities pursuant to Section 4.13(f), (i) if all Capital
Securities so issued constitute no more than 2.5% of the total equity value of
the Borrower, the Borrower shall not permit the Leverage Ratio to be greater
than 4.75 to 1 at any time from the first such issuance of such Capital
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Securities through October 31, 1996, (ii) if all Capital Securities so issued
constitute more than 2.5% but no more than 5.0% of the total equity value of
the Borrower, the Borrower shall not permit the Leverage Ratio to be greater
than 4.25 to 1 at any time from the first date upon which such Capital
Securities so issued constitute more than 2.5% of the total equity value of the
Borrower through April 30, 1998, and (iii) if all Capital Securities so issued
constitute more than 5.0% of the total equity value of the Borrower, the
Borrower shall not permit the Leverage Ratio to be greater than 3.50 to 1 at
any time from and after the first date upon which all Capital Securities so
issued constitute more than 5.0% of the total equity value of the Borrower.
Section 4.16. Fixed Charge Coverage Ratio. Permit the Fixed
Charge Coverage Ratio to be less than 1.00 to 1 at any time.
Section 4.17. Interest Coverage Ratio. Permit the Interest
Coverage Ratio to be less than 1.75 to 1 at any time prior to February 1, 1996,
and 2.00 to 1 at any time on or after February 1, 1996.
Section 4.18. Pro Forma Debt Service Ratio. Permit the Pro
Forma Debt Service Ratio to be less than 1.10 to 1 at any time.
Section 4.19. Interest Rate Protection Agreements. At any
time on and after the date that is 180 days after the Closing Date, fail to
maintain in full force and effect Interest Rate Protection Agreements or other
similar arrangements satisfactory in form and substance to a majority of the
Managing Agents with respect to a notional principal amount equal to or greater
than 40% of the sum of (a) the aggregate principal amount of the Loans
outstanding at such time plus (b) the aggregate principal amount of
Indebtedness incurred pursuant to Section 4.09(d) or permitted under Section
6.01(l) (other than Junior Subordinated Indebtedness) outstanding at such time;
provided, however, that the Borrower shall not be bound by the requirements of
this Section 4.19 at any time that the Leverage Ratio is less than or equal to
4.00 to 1.
Section 4.20. Revenues. Permit at any time the portion of
consolidated gross revenues of the Borrower and the Consolidated Subsidiaries
for any fiscal quarter of the Borrower derived from the businesses engaged in
by the Borrower and the Consolidated Subsidiaries on the Agreement Date and
related businesses to be less than 90% of the total consolidated gross revenues
of the Borrower and its Consolidated Subsidiaries for such fiscal quarter.
Section 4.21. Carriage and Related Matters. Permit the
affiliation agreements or other arrangements with Comcast or any of its
Subsidiaries or TCI or any of its Subsidiaries (to the
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extent such Subsidiaries were Subsidiaries of Comcast or TCI on the Agreement
Date) in effect on the date on which the Tender Offer was commenced and
pertaining to carriage or distribution of the Borrower's or any Subsidiary's
programming ("Existing Carriage Agreements"), the payment of commissions and
related matters to be altered or modified in any way that is materially adverse
to the Borrower, or agree to, or otherwise cause, the termination of any such
Existing Carriage Agreements, except for (a) the waiver of "Company Repurchase
Rights" as contemplated by Section 1 of the Joint Bidding Agreement and (b)
alterations and modifications of any Existing Carriage Agreements to
incorporate the terms of similar agreements made by the Borrower with Persons
who are not Affiliates of the Borrower, so long as such incorporation is
required pursuant to the terms of such Existing Carriage Agreements as in
effect on the date on which the Tender Offer was commenced.
D. The Borrower shall, and shall cause each Wholly-Owned Subsidiary
(other than a Subsidiary organized under the laws of a jurisdiction
other than the United States or any State or other political
subdivision thereof or therein) to:
Section 4.22. Material Subsidiaries. (a) Enter into a
Guaranty Agreement, and deliver any opinions of counsel and related closing
documents reasonably requested by the Administrative Agent in connection with
such Guaranty Agreement, at any time such Subsidiary becomes a Material
Subsidiary, and (b) enter into a Pledge Agreement, and deliver any opinions of
counsel and related closing documents reasonably requested by the
Administrative Agent in connection with such Pledge Agreement, at any time a
Subsidiary of such Person becomes a Material Subsidiary.
E. The Borrower shall not, and shall not permit or suffer any
Subsidiary to, directly or indirectly:
Section 4.23. Taxes of Other Persons. File a consolidated
tax return with any other Person other than, in the case of the Borrower, a
Consolidated Subsidiary and, in the case of any Subsidiary, the Borrower or a
Consolidated Subsidiary, or, except as required by Applicable Law, pay or enter
into any Contract to pay any Taxes owing by any Person other than the Borrower
or a Consolidated Subsidiary, unless, in each case, the Borrower shall have
entered into a tax sharing agreement with such Person satisfactory in form and
substance to no fewer than four of the Managing Agents.
ARTICLE 5
FINANCIAL STATEMENTS AND INFORMATION
Section 5.01. Financial Statements and Information to Be
Furnished. From the Agreement Date until the Repayment Date,
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the Borrower shall furnish to the Administrative Agent, with sufficient copies
for each of the Banks:
(a) Quarterly Financial Statements; Officer's Certificate.
As soon as available and in any event within 60 days after the close of each of
the first three quarterly accounting periods in each fiscal year of the
Borrower, commencing with the quarterly period ending April 30, 1995:
(i) a consolidated balance sheet of the Borrower and
the Consolidated Subsidiaries as at the end of such quarterly period
and the related consolidated statements of income, retained earnings
and cash flows of the Borrower and the Consolidated Subsidiaries for
such quarterly period and for the elapsed portion of the fiscal year
of the Borrower ended with the last day of such quarterly period,
setting forth in each case in comparative form the figures for the
corresponding periods of the previous fiscal year of the Borrower; and
(ii) a certificate with respect thereto of a
Responsible Officer of the Borrower in the form of Schedule 5.01(a).
(b) Year-End Financial Statements; Accountants' and Officer's
Certificates. As soon as available and in any event within 120 days after the
end of each fiscal year of the Borrower, commencing with the fiscal year ended
January 31, 1995:
(i) a consolidated balance sheet of the Borrower and
the Consolidated Subsidiaries as at the end of such fiscal year and
the related consolidated statements of income, retained earnings and
cash flows of the Borrower and the Consolidated Subsidiaries for such
fiscal year, setting forth in each case in comparative form the
figures as at the end of and for the previous fiscal year of the
Borrower;
(ii) an audit report of KPMG Peat Marwick, or other
independent certified public accountants of nationally recognized
standing, on the consolidated financial statements referred to in
clause (i) above, which report shall state that such consolidated
financial statements fairly present the consolidated financial
condition and results of operations of the Borrower and the
Consolidated Subsidiaries in conformity with Generally Accepted
Accounting Principles as at the end of and for such fiscal year;
(iii) a certificate of the accountants referred to
in clause (ii) above addressed to the Banks and in form satisfactory
to the Managing Agents stating that in making the examination
necessary for their report on such consolidated financial statements
nothing came to their attention that caused them to believe that, as
of the date
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<PAGE> 54
of such financial statements, any Default exists or, if such is not
the case, specifying such Default and its nature, when it occurred and
whether it is continuing; provided, however, that the furnishing of
such certificate shall not require any expansion of the scope of the
audit conducted by such accountants; and
(iv) a certificate of a Responsible Officer of the
Borrower in the form of Schedule 5.01(b).
(c) Reports and Filings. (i) During any period while the
most recent financial statements of the Borrower and the Consolidated
Subsidiaries delivered pursuant to Sections 5.01(a) or (b) shall have been
accompanied by a qualified opinion of the Borrower's independent public
accountants or by a similar written statement of material inadequacy with
respect to such financial statements, then, promptly upon receipt thereof,
copies of all reports, if any, submitted to the Borrower or any Subsidiary, or
the Board of Directors of the Borrower or any Subsidiary, by such independent
certified public accountants, including any management letter; and (ii)
together with the financial statements next required to be furnished pursuant
to Section 5.01(a) or (b), copies of all financial statements and reports as
the Borrower or any Subsidiary shall send to its stockholders (other than, in
the case of the Borrower or any Subsidiary, its Affiliates) and of all
registration statements and all regular or periodic reports that the Borrower
or any Subsidiary shall file with the Securities and Exchange Commission.
(d) Requested Information. From time to time and with
reasonable promptness upon request of any Bank, such Information regarding the
Loan Documents, the Loans or the business, assets, Liabilities, financial
condition, results of operations or business prospects of Holdco, the Borrower
and the Subsidiaries as such Bank may reasonably request.
(e) Notice of Events of Defaults and Other Matters. Prompt
notice of: (i) any Event of Default, after a Responsible Officer of the
Borrower shall have become aware thereof, describing such Event of Default and
the action, if any, that the Borrower is proposing to take with respect
thereto, (ii) the occurrence or non-occurrence of any change or event that
would cause the Representation and Warranty contained in Section 3.09 to be
incorrect if made at such time and (iii) any material amendment to the
certificate of incorporation or by-laws of the Borrower.
Section 5.02. Accuracy of Financial Statements and
Information.
(a) Historical Financial Statements. The Borrower hereby
represents and warrants that (i) Schedule 5.02(a) sets forth a complete and
correct list of the financial statements (other than projections) submitted by
the Borrower to the Banks
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<PAGE> 55
in order to induce them to execute and deliver this Agreement, (ii) such
financial statements present fairly, in accordance with Generally Accepted
Accounting Principles (except for pro forma balance sheets and, in the case of
quarterly financial statements, the absence of footnotes and normal year-end
audit adjustments), the consolidated financial position of QVC and its
Consolidated Subsidiaries as at their respective dates and the consolidated
results of operations, retained earnings and cash flows of QVC and its
Consolidated Subsidiaries for the respective periods to which such statements
relate and (iii) except as disclosed or reflected in such financial statements,
or otherwise set forth herein (including the Schedules hereto), as at January
31, 1994, neither QVC nor any of its Subsidiaries had any Liability, contingent
or otherwise, or any unrealized or anticipated loss, that, singly or in the
aggregate, has had or could reasonably be expected to have a Materially Adverse
Effect on the Borrower and the Consolidated Subsidiaries taken as a whole.
(b) Future Financial Statements. The financial statements
delivered pursuant to Section 5.01(a) or (b) shall present fairly, in
accordance with Generally Accepted Accounting Principles (except for changes
therein or departures therefrom, subject to satisfaction of the exception set
forth in Section 10.02), the consolidated financial position of the Borrower
and the Consolidated Subsidiaries as at their respective dates and the
consolidated results of operations, retained earnings and cash flows of the
Borrower and such Subsidiaries for the respective periods to which such
statements relate. The furnishing of the financial statements pursuant to
Section 5.01(a) and (b) shall constitute a representation and warranty by the
Borrower made on the date the same are furnished to the Administrative Agent to
that effect and to the further effect that, except as disclosed or reflected in
such financial statements, as at the respective dates thereof, neither the
Borrower nor any Subsidiary had any Liability, contingent or otherwise, or any
unrealized or anticipated loss, that, singly or in the aggregate, has had or
could reasonably be expected to have a Materially Adverse Effect on the
Borrower and the Consolidated Subsidiaries taken as a whole.
(c) Historical Information. The Borrower hereby represents
and warrants that all Information (other than the financial statements listed
on Schedule 5.02(a) and financial projections) furnished to the Administrative
Agent or the Banks in writing by or on behalf of the Borrower or any Subsidiary
and concerning such Person, and not the cable television industry generally,
prior to the Agreement Date in connection with or pursuant to the Loan
Documents and the relationships established thereunder, at the time the same
was so furnished, but in the case of Information dated as of a prior date, as
of such date, when taken together (giving effect to Information so furnished
that corrects, supplements or supersedes Information previously furnished), (i)
in the case of any Information prepared in the
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<PAGE> 56
ordinary course of business, was correct in all material respects in the light
of the purpose for which it was prepared and (ii) in the case of any
Information the preparation of which was requested by any Bank, (A) did not
contain any untrue statement of a material fact and (B) did not omit to state a
material fact necessary in order to make the statements contained therein not
misleading in the light of the circumstances under which they were made. The
Borrower hereby represents and warrants that the final financial projections
furnished to the Administrative Agent or the Banks in writing by or on behalf
of the Borrower or any Subsidiary prior to the Agreement Date, which are not to
be construed as guaranties of the financial performance of the Borrower and the
Consolidated Subsidiaries for the period or periods to which such projections
relate, were based on reasonable estimates and assumptions made by the Borrower
in good faith and are the projections used in the capitalization and financial
planning of the Borrower and the Consolidated Subsidiaries for such period or
periods, and no fact is known to the Borrower on the Agreement Date that has
not been disclosed in writing to the Banks that would result in any material
change in any such projections or in any estimate or assumption reflected
therein.
(d) Future Information. All Information (other than
financial statements delivered pursuant to Section 5.01(a) or (b)) furnished to
the Administrative Agent or the Banks in writing by or on behalf of the
Borrower or any Subsidiary and concerning such Person, and not the cable
television industry generally, on or after the Agreement Date in connection
with or pursuant to the Loan Documents or in connection with or pursuant to any
amendment or modification of, or waiver of rights under, the Loan Documents,
shall, at the time the same is so furnished, but in the case of Information
dated as of a prior date, as of such date, when taken together (giving effect
to Information so furnished that corrects, supplements or supersedes
Information previously so furnished) (i) in the case of any Information
prepared in the ordinary course of business, be correct in all material
respects in the light of the purpose for which it was prepared and (ii) in the
case of any Information required by the terms of the Loan Documents or the
preparation of which was requested by any Bank, not contain any untrue
statement of a material fact, and not omit to state a material fact necessary
in order to make the statements contained therein not misleading in the light
of the circumstances under which they were made, and the furnishing of the same
to the Administrative Agent or any Bank shall constitute a representation and
warranty by the Borrower made on the date the same are so furnished to the
effect specified in clauses (i) and (ii) above.
Section 5.03. Additional Covenants Relating to Disclosure.
From the Agreement Date until the Repayment Date, the Borrower shall and shall
cause each Subsidiary to:
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(a) Accounting Methods and Financial Records. Maintain a
system of accounting, and keep such books, records and accounts (which shall be
true and complete) as may be required or necessary to permit (i) the
preparation of financial statements required to be delivered pursuant to
Sections 5.01(a) and (b) and (ii) the determination of the compliance of the
Borrower and the Subsidiaries with the terms of the Loan Documents.
(b) Fiscal Year. Maintain the same opening and closing dates
for each fiscal year as for the fiscal year reflected in the Base Financial
Statements or, if the opening and closing dates for the fiscal year reflected
in the Base Financial Statements were determined pursuant to a formula,
determine the opening and closing dates for each fiscal year pursuant to the
same formula; provided that if the Borrower becomes a consolidated Subsidiary
of any Person that has a fiscal year ending on December 31, the Borrower and
the Subsidiaries may change their fiscal year to end on December 31, and in
such event the Borrower and the Banks agree to enter into any amendments to
this Agreement and the other Borrower Loan Documents reasonably requested by
the Managing Agents in order to reflect such change of fiscal year in a manner
designed to preserve the intent of the provisions hereof.
(c) Visits, Inspections and Discussions. Permit
representatives (whether or not officers or employees) of any Bank, from time
to time, as often as may be reasonably requested and upon reasonable notice,
but, unless an Event of Default shall have occurred and be continuing, at such
Bank's expense, to (i) visit any of its premises or property or any premises or
property of others on which any of its property or books and records (or books
and records of others relating to it) may be located, (ii) inspect, and verify
the amount, character and condition of, any of its property, (iii) review and
make extracts from its books and records and books and records of others
relating to it and (iv) discuss its affairs, finances and accounts with its
officers, employees and, upon prior notice to the Borrower and subject to the
Borrower's right, unless an Event of Default shall have occurred and be
continuing, to have a representative present at such discussion, its
independent public accountants (and by this provision the Borrower authorizes
such accountants to discuss the finances and affairs of the Borrower and the
Subsidiaries).
Section 5.04. Authorization of Third Parties to Deliver
Information. The Borrower hereby agrees that any opinion, report or other
Information delivered to the Administrative Agent, the Managing Agents or the
Banks pursuant to the Loan Document (including under Article 2 or this Article
5) is hereby deemed to have been authorized and directed by the Borrower to be
delivered for the benefit of the Administrative Agent, the Managing Agents and
the Banks.
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ARTICLE 6
DEFAULT
Section 6.01. Events of Default. Each of the following shall
constitute an Event of Default, whatever the reason for such event and whether
it shall be voluntary or involuntary, or within or without the control of the
Borrower, any Subsidiary or any other Loan Party, or be effected by operation
of law or pursuant to any judgment or order of any court or any order, rule or
regulation of any governmental or nongovernmental body:
(a) Any payment of principal of or interest on any of the
Loans or the Notes, any reimbursement of any Drawing or any payment of any fee,
or any cash collateralization of any Contingent Reimbursement Obligation shall
not be made when and as due (whether at maturity, upon mandatory prepayment, by
reason of notice of prepayment or acceleration or otherwise) and in accordance
with the terms of this Agreement and the Notes and, except in the case of
payments of principal or reimbursements of Drawings, such failure shall
continue for three Business Days;
(b) Any Loan Document Representation and Warranty shall at
any time prove to have been incorrect or misleading in any material respect
when made;
(c) (i) The Borrower shall default in the performance or
observance of:
(A) any term, covenant, condition or
agreement contained in (x) Section 4.01(a) (insofar as such
Section requires the preservation of the corporate existence
of each of the Loan Parties), 4.03 through 4.18, 4.20, 4.21,
4.23, 5.01(e)(i) or 5.03(b) of this Agreement or (y) Sections
2 and 3 of the Pledge Agreement to which it is a party; or
(B) any term, covenant, condition or
agreement contained in any Borrower Loan Document (other than
a term, covenant, condition or agreement a default in the
performance or observance of which is elsewhere in this
Section 6.01 specifically dealt with) and, if capable of being
remedied, such default shall continue unremedied for a period
of 30 days; or
(ii) Any Transaction Party (other than the Borrower)
shall default in the performance or observance of:
(A) any term, covenant, condition or
agreement contained in (x) the Guaranty Agreement to which it
is a party or (y) Sections 2 and 3 of the Pledge Agreement to
which it is a party; or
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<PAGE> 59
(B) any term, covenant, condition or
agreement contained in any Loan Document to which it is a
party (other than a term, covenant, condition or agreement a
default in the performance or observation of which is
elsewhere in this Section 6.01 specifically dealt with) and,
if capable of being remedied, such default shall continue
unremedied for a period of 30 days;
(d) (i) The Borrower, any Subsidiary or Holdco shall fail to
pay, in accordance with its terms and when due and payable (after giving effect
to any applicable grace period), any of the principal of or interest on any
Indebtedness (other than the Loans and Affiliate Subordinated Indebtedness)
having a then outstanding principal amount in excess of $20,000,000, (ii) the
maturity of any such Indebtedness shall, in whole or in part, have been
accelerated, or any such Indebtedness shall, in whole or in part, have been
required to be prepaid or purchased prior to the stated maturity thereof (other
than pursuant to any customary due- on-sale clause or any provision requiring
prepayment of such Indebtedness based on excess cash flow or other similar
arrangement), in accordance with the provisions of any Contract evidencing,
providing for the creation of or concerning such Indebtedness or (iii) (A) any
event shall have occurred and be continuing that, after giving effect to any
applicable waivers or amendments, permits (or, with the passage of time or the
giving of notice or both, would permit) any holder or holders of such
Indebtedness, any trustee or agent acting on behalf of such holder or holders
or any other Person so to accelerate such maturity or require any such
prepayment or purchase and (B) if the Contract evidencing, providing for the
creation of or concerning such Indebtedness provides for a cure period for such
event, such event shall not be cured prior to the end of such cure period;
(e) A default by the Borrower or any Subsidiary shall be
continuing under any Contract (other than a Contract relating to Indebtedness
to which clause (d) of this Section 6.01 is applicable) binding upon the
Borrower or any Subsidiary, except a default that, together with all other such
defaults, has not had and will not have a Materially Adverse Effect on (i) the
Borrower and the Consolidated Subsidiaries taken as a whole, (ii) any Material
Loan Document or (iii) the Collateral;
(f) (i) The Borrower, any Material Subsidiary or any other
Loan Party shall (A) commence a voluntary case under the Federal bankruptcy
laws (as now or hereafter in effect), (B) file a petition seeking to take
advantage of any other laws, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, winding up or composition or adjustment of debts,
(C) consent to or fail to contest in a timely and appropriate manner any
petition filed against it in an involuntary case under such bankruptcy laws or
other laws, (D) apply for, or consent to, or fail to contest in a timely and
appropriate manner, the
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appointment of, or the taking of possession by, a receiver, custodian, trustee,
liquidator or the like of itself or of a substantial part of its assets,
domestic or foreign, (E) generally not be paying its debts (other than those
that are the subject of bona fide disputes) as they become due, (F) make a
general assignment for the benefit of creditors or (G) take any corporate
action for the purpose of effecting any of the foregoing, except that no event
or condition referred to in clauses (A) through (G) above with respect to any
Pledgor which is not the Borrower or a Subsidiary shall constitute an Event of
Default if it, together with all other such events or conditions at the time
existing, has not had and could not reasonably be expected to have a Materially
Adverse Effect on (x) the Borrower and the Consolidated Subsidiaries taken as a
whole, (y) any Material Loan Document (other than the Pledge Agreement to which
such Pledgor is a party) or (z) the Collateral (other than the Collateral
subject to the Lien created by the Pledge Agreement to which such Pledgor is a
party); or
(ii) (A) A case or other proceeding shall be commenced
against the Borrower, any Material Subsidiary or any other Loan Party seeking
(x) relief under the Federal bankruptcy laws (as now or hereafter in effect) or
under any other laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition or adjustment of debts or (y) the
appointment of a trustee, receiver, custodian, liquidator or the like of the
Borrower, any Material Subsidiary or any other Loan Party, or of all or any
substantial part of the assets, domestic or foreign, of the Borrower, any
Material Subsidiary or any other Loan Party, and such case or proceeding shall
continue undismissed or unstayed for a period of 60 days or (B) an order
granting the relief requested in such case or proceeding against the Borrower,
any Material Subsidiary or any other Loan Party (including an order for relief
under such Federal bankruptcy laws) shall be entered, except that no event or
condition referred to in clauses (A) through (B) above with respect to any
Pledgor which is not the Borrower or a Subsidiary shall constitute an Event of
Default if it, together with all other such events or conditions at the time
existing, has not had and could not reasonably be expected to have a Materially
Adverse Effect on (x) the Borrower and the Consolidated Subsidiaries taken as a
whole, (y) any Material Loan Document (other than the Pledge Agreement to which
such Pledgor is a party) or (z) the Collateral (other than the Collateral
subject to the Lien created by the Pledge Agreement to which such Pledgor is a
party);
(g) A judgment or order shall be entered against the Borrower
or any Material Subsidiary by any court and (i) in the case of a judgment or
order for the payment of money, such judgment or order shall continue
undismissed, unbonded, undischarged or unstayed for a period of 30 days in
which the aggregate amount of all such judgments and orders exceeds $10,000,000
and (ii) in the case of any judgment or order for other than the payment of
money, such judgment or order could, in
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the reasonable judgment of the Required Banks, together with all other such
judgments or orders, have a Materially Adverse Effect on the Borrower and the
Consolidated Subsidiaries taken as a whole;
(h) (i) any Termination Event shall occur with respect to any
Benefit Plan of the Borrower or any Material Subsidiary or any of their
respective ERISA Affiliates, (ii) any Accumulated Funding Deficiency, whether
or not waived, shall exist with respect to any such Benefit Plan, (iii) any
Person shall engage in any Prohibited Transaction involving any such Benefit
Plan, (iv) the Borrower, any Material Subsidiary or any of their respective
ERISA Affiliates shall be in "default" (as defined in Section 4219(c)(5) of
ERISA) with respect to payments owing to any such Benefit Plan that is a
Multiemployer Benefit Plan as a result of such Person's complete or partial
withdrawal (as described in Section 4203 or 4205 of ERISA) therefrom, (v) the
Borrower, any Material Subsidiary or any of their respective ERISA Affiliates
shall fail to pay when due an amount that is payable by it to the PBGC or to
any such Benefit Plan under Title IV of ERISA, (vi) a proceeding shall be
instituted by a fiduciary of any such Benefit Plan against the Borrower, any
Material Subsidiary or any of their respective ERISA Affiliates to enforce
Section 515 of ERISA and such proceeding shall not have been dismissed within
30 days thereafter or (vii) any other event or condition shall occur or exist
with respect to any such Benefit Plan, except that no event or condition
referred to in clauses (i) through (vii) above shall constitute an Event of
Default if it, together with all other such events or conditions at the time
existing, has not subjected and is not reasonably likely to subject the
Borrower or any Subsidiary to any Liability that, alone or in the aggregate,
has had or could have a Materially Adverse Effect on (x) the Borrower and the
Consolidated Subsidiaries taken as a whole, (y) any Material Loan Document or
(z) the Collateral;
(i) Any Transaction Party asserts, or any Loan Party
institutes any proceedings seeking to establish, that (i) any provision of the
Loan Documents is invalid, not binding or unenforceable or (ii) the Security
Interest is not a valid and perfected first priority security interest in the
Collateral subject only to Permitted Liens;
(j) (i) Comcast and Liberty, collectively, shall at any time
cease to beneficially own issued and outstanding capital stock and other issued
and outstanding Capital Securities of the Borrower having not less than 51% of
the total equity value of the Borrower, or Comcast, any of its Affiliates,
Liberty or any of its Affiliates, collectively, shall at any time cease to have
at least 51% control over the Borrower or (ii) either Comcast or Liberty,
individually, shall at any time prior to February 9, 2000 cease to beneficially
own issued and outstanding capital stock and other issued and outstanding
Capital Securities of the Borrower having at least 19.9% of the total equity
value of the
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Borrower; provided, however, that all references to the Borrower in this
Section 6.01(j) shall be deemed to be references to Holdco following the
formation of Holdco;
(k) The Joint Ownership and Management Agreements shall have
been amended, modified or supplemented in any respect material to the Banks,
other than any such amendment, modification or supplement that has been
consented to in writing by the Required Banks (such consent not to be
unreasonably withheld); and
(l) Holdco shall incur, create, assume or suffer to exist any
Indebtedness, except for Permitted Holdco Replacement Debt and Junior
Subordinated Indebtedness.
As used in Section 6.01(j), the term "beneficially own" refers to a Person's
proportionate direct and indirect attributable economic interest in another
Person's Capital Securities, and the term "51% control" refers to a Person's or
group of Persons' direct ownership of another Person's Capital Securities
having 51% or more of the ordinary voting power for the election of directors
(or other persons having similar functions) of such other Person.
Section 6.02. Remedies upon Event of Default. During the
continuance of any Event of Default (other than one specified in Section
6.01(f) with respect to the Borrower) and in every such event, the
Administrative Agent, upon notice to the Borrower, may (but shall not be
obligated to), and if so directed by the Required Banks shall, do either or
both of the following: (a) declare, in whole or, from time to time, in part,
the principal of and interest on the Loans and the Notes and all other amounts
owing under the Borrower Loan Documents to be, and the Loans and the Notes and
all such other amounts shall thereupon and to that extent become, due and
payable, (b) demand that the Borrower deliver cash collateral to the
Administrative Agent in an amount equal to the aggregate amount of Contingent
Reimbursement Obligations then outstanding to be held in accordance with
Section 9.19 and such amount shall thereupon become due and payable to the
Administrative Agent and (c) terminate, in whole or, from time to time, in
part, the Commitments. Upon the occurrence of an Event of Default specified in
Section 6.01(f) with respect to the Borrower, automatically and without any
notice to the Borrower, (i) the principal of and interest on the Loans and the
Notes and all other amounts owing under the Borrower Loan Documents shall be
due and payable and (ii) the Commitments shall terminate. Presentment, demand,
protest or notice of any kind (other than the notice provided for in the first
sentence of this Section 6.02) are hereby expressly waived.
Section 6.03. Certain Cure Rights. Notwithstanding the
provisions of Sections 6.01 and 6.02, but without limiting the obligations of
the Borrower under Sections 4.15, 4.16, 4.17
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and 4.18, if the Borrower shall default in the performance or observance of any
term, covenant, condition or agreement contained in Section 4.15, 4.16, 4.17 or
4.18, such default shall not constitute an Event of Default (but shall
constitute a Default) until the Cure Date, and if on or before the Cure Date
the respective actions set forth below shall have been taken and evidence
thereof shall have been delivered to the Banks, then such default shall be
deemed to have been cured:
(a) With respect to Section 4.15, the Borrower shall have
prepaid Loans, either from cash on hand or the proceeds of new capital
contributions or Junior Subordinated Indebtedness in an aggregate amount
sufficient so that, after giving effect to the application of such prepayments
and the reduction of Consolidated Indebtedness by the amount thereof for the
purpose of determining compliance with Section 4.15, the Borrower would be in
compliance therewith as recalculated at the date of receipt of such proceeds;
and
(b) With respect to Section 4.16, 4.17 or 4.18, the Borrower
shall have prepaid Loans, either from the proceeds of new capital contributions
or the proceeds of Junior Subordinated Indebtedness, in an aggregate amount
sufficient so that, if the respective ratios set forth in Section 4.16, 4.17 or
4.18 as at the date of receipt of such proceeds were recalculated in a manner
which would include as additional Cash Flow of the Borrower and the
Consolidated Subsidiaries the amount of such proceeds, the Borrower would be in
compliance with Section 4.16, 4.17 or 4.18, as applicable, as at such date;
provided, however, that (i) any such default may not be deemed to be cured
pursuant to this Section 6.03 more than an aggregate of four times during the
term of this Agreement or with respect to consecutive fiscal quarters of the
Borrower and, for purposes of this proviso, in the event that the receipt and
application by the Borrower of the proceeds of any Junior Subordinated
Indebtedness shall at any time have the effect of enabling the Borrower to
avoid any such default, the Borrower shall be deemed to have cured any such
default pursuant to this Section 6.03 and (ii) the recalculations described in
this Section 6.03 shall not be deemed to constitute a recalculation for any
other purpose of this Agreement, including the determination of the Applicable
Margin. For purposes of this Section 6.03, "Cure Date" means, with respect to
any breach of the covenants contained in Sections 4.15, 4.16, 4.17 and 4.18,
the date that is 30 days after the earlier of (A) the day on which financial
statements for the fiscal quarter (or fiscal year, in the case of any such
breach occurring in the fourth quarter of any fiscal year) in which such breach
occurred are delivered to the Banks pursuant to Section 5.01 and (B) the day by
which such financial statements are required to be delivered pursuant to
Section 5.01.
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ARTICLE 7
ADDITIONAL CREDIT FACILITY PROVISIONS
Section 7.01. Mandatory Suspension and Conversion of
Eurodollar Rate Loans. A Bank's obligations to make, continue or convert into
Eurodollar Rate Loans of any Type shall be suspended, all such Bank's
outstanding Loans of such Type shall be converted on the last day of their
applicable Interest Periods (or, if earlier, in the case of clause (c) below,
on the last day such Bank may lawfully continue to maintain Loans of such Type
or, in the case of clause (d) below, on the day determined by such Bank to be
the last Business Day before the effective date of the applicable restriction)
into, and all pending requests for the making or continuation of or conversion
into Loans of such Type by such Bank shall be deemed requests for, Base Rate
Loans, if:
(a) on or prior to the determination of an interest rate for
a Eurodollar Rate Loan of such Type for any Interest Period, the Administrative
Agent determines that for any reason appropriate information is not available
to it for purposes of determining the Eurodollar Rate for such Interest Period;
(b) on or prior to the first day of any Interest Period for a
Eurodollar Rate Loan of such Type, the Required Banks have informed the
Administrative Agent of their determination that the Eurodollar Rate as
determined by the Administrative Agent for such Interest Period would not
accurately reflect the cost to such Banks of making, continuing or converting
into a Eurodollar Rate Loan of such Type for such Interest Period;
(c) at any time such Bank determines that any Regulatory
Change makes it unlawful or impracticable for such Bank or its applicable
Lending Office to make, continue or convert into a Eurodollar Rate Loan of such
Type, or to comply with its obligations hereunder in respect thereof; or
(d) such Bank notifies the Administrative Agent of its
determination that (i) by reason of any Regulatory Change, such Bank or its
applicable Lending Office is restricted, directly or indirectly, in the amount
that it may hold of (A) a category of liabilities that includes deposits by
reference to which, or on the basis of which, the interest rate applicable to
Eurodollar Rate Loans of such Type is directly or indirectly determined or (B)
the category of assets that includes Eurodollar Rate Loans of such Type and
(ii) such Bank has elected that this Section 7.01(d) shall apply to its
Eurodollar Rate Loans of such Type.
If, as a result of this Section 7.01, any Loan of any Bank that would otherwise
be made or maintained as or converted into a Eurodollar Rate Loan of any Type
for any Interest Period is instead made or maintained as or converted into a
Base Rate Loan,
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then, unless the corresponding Loan of each of the other Banks is also to be
made or maintained as or converted into a Base Rate Loan, such Loan shall be
treated as being a Eurodollar Rate Loan of such Type for such Interest Period
for all purposes of this Agreement (including the timing, application and
proration among the Banks of interest payments, conversions and prepayments)
except for the calculation of the interest rate borne by such Loan. The
Administrative Agent shall promptly notify the Borrower and each Bank of the
existence or occurrence of any condition or circumstance specified in clause
(a) or (b) above, and each Bank shall promptly notify the Borrower and the
Administrative Agent of the existence, occurrence or termination of any
condition or circumstance specified in clause (c) or (d) above applicable to
such Bank's Loans, but the failure by the Administrative Agent or such Bank to
give any such notice shall not affect such Bank's rights hereunder.
Section 7.02. Regulatory Changes. If in the determination of
any Bank or, in the case of any Letter of Credit or Drawing, the Issuing Bank
(a) any Regulatory Change shall directly or indirectly (i) reduce the amount of
any sum received or receivable by (A) such Bank with respect to any Eurodollar
Rate Loan or Letter of Credit Participation or the return to be earned by such
Bank on any Eurodollar Rate Loan or Letter of Credit Participation or (B) the
Issuing Bank with respect to any Letter of Credit or Drawing, (ii) impose a
cost on (A) such Bank or any Affiliate of such Bank that is attributable to the
making or maintaining of, or such Bank's commitment to make or acquire, any
Eurodollar Rate Loan or Letter of Credit Participation or (B) the Issuing Bank
or any of its Affiliates that is attributable to the issuance or maintaining
of, or the commitment to issue, any Letter of Credit or the making or
maintaining of any Drawing, (iii) require (A) such Bank or any Affiliate of
such Bank to make any payment on or calculated by reference to the gross amount
of any amount received by such Bank under any Loan Document in respect of its
Eurodollar Rate Loans or its obligations to make Eurodollar Rate Loans or (B)
the Issuing Bank or any of its Affiliates to make any payment on or calculated
by reference to the gross amount of any amount received by the Issuing Bank or
any of its Affiliates in respect of any Letter of Credit or its commitment to
issue any Letter of Credit or Drawing or (iv) reduce, or have the effect of
reducing, the rate of return on any capital of (A) such Bank or any Affiliate
of such Bank that such Bank or such Affiliate is required to maintain on
account of any Eurodollar Rate Loan or Letter of Credit Participation or such
Bank's commitment to make any Eurodollar Rate Loan or Letter of Credit
Participation or (B) the Issuing Bank or any of its Affiliates that the Issuing
Bank or such Affiliate is required to maintain on account of any Letter of
Credit or Drawing or the Issuing Bank's commitment to issue any Letter of
Credit and (b) such reduction, increased cost or payment shall not be fully
compensated for by an adjustment in the applicable rates of interest payable
under the Loan Documents, then the Borrower shall pay to such Bank or the
Issuing Bank, as the case may be,
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such additional amounts as such Bank or the Issuing Bank, as the case may be,
determines will, together with any adjustment in the applicable rates of
interest payable hereunder, fully compensate for such reduction, increased cost
or payment. Such additional amounts shall be payable, in the case of those
applicable to prior periods, within 15 Business Days after request by such Bank
or the Issuing Bank, as the case may be, for such payment accompanied by the
certificate described in Section 7.05 and, in the case of those applicable to
future periods, on the dates specified, or determined in accordance with a
method specified, by such Bank or the Issuing Bank, as the case may be. Each
Bank and the Issuing Bank will promptly notify the Borrower of any
determination made by it referred to in clauses (a) and (b) above, but the
failure to give such notice shall not affect such Bank's, or the Issuing
Bank's, as the case may be, right to such compensation; provided, however, that
the Borrower shall not be required to pay such additional amounts in respect of
any Regulatory Change for any period ending prior to the date that is 90 days
prior to the giving of the notice of the determination of such additional
amounts (unless such period shall have commenced after the date that such Bank
or the Issuing Bank, as the case may be, notified the Borrower of the
possibility that additional amounts may be payable as a result of such
Regulatory Change), except, if such Regulatory Change shall have been imposed
retroactively, for the period from the effective date of such Regulatory Change
to the date that is 90 days after the first date on which such Bank or the
Issuing Bank, as the case may be, reasonably should have had knowledge of such
Regulatory Change.
Section 7.03. Capital and Reserve Requirements. If, in the
determination of any Bank or the Issuing Bank, as the case may be, such Bank,
the Issuing Bank or any Affiliate of such Bank or the Issuing Bank is required,
under Applicable Law (including Regulation D), interpretations, directives,
requests and governmental or regulatory guidelines (whether or not having the
force of law), to maintain capital or deposit any reserve on account of any
Loan, any Letter of Credit (whether drawn or undrawn) or such Bank's, or the
Issuing Bank's, as the case may be, commitment to make any Loan or issue any
Letter of Credit, then, upon request by such Bank or the Issuing Bank, as the
case may be, the Borrower shall from time to time thereafter pay to such Bank
or the Issuing Bank, as the case may be, such additional amounts as such Bank
or the Issuing Bank, as the case may be, determines will fully compensate for
any reduction in the rate of return on the capital that such Bank, the Issuing
Bank or such Affiliate is so required to maintain on account of such Loan,
Letter of Credit or commitment suffered as a result of such capital requirement
or for the cost imposed on such Bank, the Issuing Bank or such Affiliate by
such reserve requirement. Such additional amounts shall be payable, in the
case of those applicable to prior periods, within 15 Business Days after
request by such Bank or the Issuing Bank, as the case may be, for such payment
accompanied by the certificate described in Section 7.05 and, in the case of
those relating to future periods, on the
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dates specified, or determined in accordance with a method specified, by such
Bank or the Issuing Bank, as the case may be; provided, however, that the
Borrower shall not be required to pay such additional amounts in respect of any
capital or reserve requirement for any period ending prior to the date that is
90 days prior to the making of such Bank's or the Issuing Bank's, as the case
may be, initial request for such additional amounts (unless such period shall
have commenced after the date that such Bank or the Issuing Bank, as the case
may be, notified the Borrower of the possibility that additional amounts may be
payable as a result of such capital or reserve requirement), except, if such
capital or reserve requirement shall have been imposed retroactively, for the
period from the effective date of such capital or reserve requirement to the
date that is 90 days after the first date on which such Bank or the Issuing
Bank, as the case may be, reasonably should have had knowledge of such capital
or reserve requirement.
Section 7.04. Funding Losses. The Borrower shall pay to each
Bank, upon request, such amount or amounts as such Bank determines are
necessary to compensate it for any loss, cost or expense (excluding loss of the
Applicable Margin) incurred by it as a result of (a) any payment, prepayment or
conversion of a Eurodollar Rate Loan on a date other than the last day of an
Interest Period for such Eurodollar Rate Loan or (b) a Eurodollar Rate Loan for
any reason not being made or converted, or any payment of principal thereof or
interest thereon not being made, on the date therefor determined in accordance
with the applicable provisions of this Agreement. At the election of such
Bank, and without limiting the generality of the foregoing, but without
duplication, such compensation on account of losses may include an amount equal
to the excess of (i) the interest that would have been received from the
Borrower under this Agreement (excluding the Applicable Margin) on any amounts
to be reemployed during an Interest Period or its remaining portion over (ii)
the interest component of the return that such Bank determines it could have
obtained had it placed such amount on deposit in the interbank Dollar market
selected by it for a period equal to such Interest Period or remaining portion.
Section 7.05. Determinations. In making the determinations
contemplated by Sections 7.01, 7.02, 7.03 and 7.04, each Bank and the Issuing
Bank may make such estimates, assumptions, allocations and the like that such
Person in good faith determines to be appropriate, and such Person's selection
thereof in accordance with this Section 7.05, and the determinations made by
such Person on the basis thereof, shall be final, binding and conclusive upon
the Borrower, except, in the case of such determinations, for manifest errors.
Each Bank and the Issuing Bank shall furnish to the Borrower, at the time of
any request for compensation under Section 7.02 or 7.03 and otherwise upon
request, a certificate outlining in reasonable detail the computation of any
amounts claimed by it under this Article 7 and the assumptions underlying such
computations, which
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shall include a statement of an officer of such Person certifying that such
request for compensation is being made pursuant to a policy adopted by such
Person to seek such compensation generally from customers similar to the
Borrower and having similar provisions in agreements with such Person.
Section 7.06. Change of Lending Office. If an event occurs
with respect to a Lending Office of any Bank or, in the case of any Letter of
Credit or Drawing, the Issuing Bank, that obligates the Borrower to pay any
amount under Section 1.13, makes operable the provisions of Section 7.01(c) or
(d) or entitles such Bank or the Issuing Bank, as the case may be, to make a
claim under Section 7.02 or 7.03, such Bank or the Issuing Bank, as the case
may be, shall, if requested by the Borrower, use reasonable efforts to
designate another Lending Office or Offices the designation of which will
reduce the amount the Borrower is so obligated to pay, eliminate such
operability or reduce the amount such Bank or the Issuing Bank, as the case may
be, is so entitled to claim, provided that such designation would not, in the
sole and absolute discretion of such Bank or the Issuing Bank, as the case may
be, be disadvantageous to such Bank or the Issuing Bank, as the case may be, in
any manner or contrary to such Bank's or the Issuing Bank's, as the case may
be, policies. Each Bank and the Issuing Bank may at any time and from time to
time change any Lending Office and shall give notice of any such change to the
Administrative Agent and the Borrower. Except in the case of a change in
Lending Offices made at the written request of the Borrower, the designation of
a new Lending Office by any Bank or the Issuing Bank shall not obligate the
Borrower to pay any amount to such Bank under Section 1.13, make operable the
provisions of Section 7.01(c) or (d) or entitle such Bank or the Issuing Bank
to make a claim under Section 7.02 or 7.03 if such obligation, the operability
of such clause or such claim results solely from such designation and not from
a subsequent Regulatory Change.
Section 7.07. Replacement of Banks. If any Bank requests
compensation pursuant to Section 1.13, 7.02 or 7.03, or such Bank's obligation
to make or continue, or to convert Loans of any other Type into, any Type of
Eurodollar Rate Loan shall be suspended pursuant to Section 7.01, the Borrower,
upon three Business Days' notice, may require that such Bank transfer all of
its right, title and interest under this Agreement and such Bank's Notes to any
bank or financial institution identified by the Borrower with the consent of
the Administrative Agent (which consent shall not be unreasonably withheld) (a)
if such proposed transferee agrees to assume all of the obligations of such
Bank for consideration equal to the outstanding principal amount of such Bank's
Loans and such Bank's pro rata share of Drawings with respect to which it has
made its required payments under Section 1.03(g), together with interest
thereon to the date of such transfer, and satisfactory arrangements are made
for payment to such Bank of all other amounts payable hereunder to such Bank on
or prior to the date of such transfer (including any fees
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accrued hereunder and any amounts that would be payable under Section 7.04 as
if all of such Bank's Loans were being prepaid in full on such date) and (b) if
such Bank being replaced has requested compensation pursuant to Section 1.13,
7.02 or 7.03, such proposed transferee's aggregate requested compensation, if
any, pursuant to Section 1.13, 7.02 or 7.03 with respect to such replaced
Bank's Loans is lower than that of the Bank replaced. Without prejudice to the
survival of any other agreement of the Borrower hereunder, the agreements of
the Borrower contained in Sections 1.13, 7.02, 7.03, 7.04 and 9.02 (without
duplication of any payments made to such Bank by the Borrower or the proposed
transferee) shall survive for the benefit of any Bank replaced under this
Section 7.07 with respect to the time prior to such replacement.
ARTICLE 8
THE AGENTS
Section 8.01. Appointment and Powers. Each Bank hereby
irrevocably appoints and authorizes the Agents, individually in their
respective capacities as Agents, to act as the agents for such Bank under the
Loan Documents with such powers as are delegated to the respective Agents by
the terms thereof, together with such other powers as are reasonably incidental
thereto. The Agents' duties shall be purely ministerial and they shall have no
duties or responsibilities except those expressly set forth in the Loan
Documents. None of the Agents shall be required under any circumstances to
take any action that, in its judgment, (a) is contrary to any provision of the
Loan Documents or Applicable Law or (b) would expose it to any Liability or
expense against which it has not been indemnified to its satisfaction. None of
the Agents shall, by reason of its serving as an Agent, be a trustee or other
fiduciary for any Bank. By its execution and delivery hereof, each Bank, in
its capacity as a Bank and in its capacity, if any, as a party to an Interest
Rate Protection Agreement, authorizes the Administrative Agent to act as its
agent under, and to execute and deliver, in its name and on its behalf, the
Security Agreement, the Pledge Agreements, the Subsidiary Security Agreements,
the Guaranty Agreements and the Affiliate Subordination Agreement. The
Administrative Agent shall consent to any amendment of any term, covenant,
agreement or condition of, or to any waiver of any right under, the Pledge
Agreements, the Guaranty Agreements or the Affiliate Subordination Agreement
if, but only if, the Administrative Agent is directed to do so in writing by
the Required Banks; provided, however, that the Administrative Agent shall not
(i) be required to consent to any such amendment or waiver that affects its
rights or duties and (ii) unless directed to do so in writing by each Bank, or
unless pursuant to a transaction that is expressly permitted under the Loan
Documents, consent to any assignment by any other Person party to the Pledge
Agreements, the Guaranty Agreements or the
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Affiliate Subordination Agreement of any of such Person's rights or obligations
thereunder or release such Person from its obligations thereunder or release
any portion of the Collateral from the Security Interest.
Section 8.02. Limitation on Agents' Liability. None of the
Agents nor any of their respective directors, officers, employees or agents
shall be liable or responsible for any action taken or omitted to be taken by
them under or in connection with the Loan Documents, except for its or their
own gross negligence or willful misconduct. None of the Agents shall be
responsible to any Bank for (a) any recitals, statements, representations or
warranties contained in the Loan Documents or in any certificate or other
document referred to or provided for in, or received by any of the Banks under,
the Loan Documents, (b) the validity, effectiveness or enforceability of the
Loan Documents or any such certificate or other document, (c) the value or
sufficiency of the Collateral or (d) any failure by the Loan Parties to perform
any of their obligations under the Loan Documents. Each of the Agents may
employ agents and attorneys-in-fact and shall not be responsible for the
negligence or misconduct of any such agents or attorneys-in-fact so long as
such Agent was not grossly negligent in selecting or directing such agents or
attorneys-in- fact. Each of the Agents shall be entitled to rely upon any
certification, notice or other communication (including any thereof by
telephone, telex, telecopier, telegram or cable) believed by it to be genuine
and correct and to have been signed or given by or on behalf of the proper
Person or Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by such Agent. As to any matters not
expressly provided for by the Loan Documents, each of the Agents shall in all
cases be fully protected in acting, or in refraining from acting, under the
Loan Documents in accordance with instructions signed by the Required Banks,
and such instructions of the Required Banks and any action taken or failure to
act pursuant thereto shall be binding on all of the Banks.
Section 8.03. Defaults. The Administrative Agent shall not
be deemed to have knowledge of the occurrence of a Default (other than the
non-payment to it of fees or principal of or interest on Loans) unless the
Administrative Agent has received notice from a Bank or the Borrower specifying
such Default and stating that such notice is a "Notice of Default." In the
event that the Administrative Agent receives such a notice of the occurrence of
a Default, the Administrative Agent shall give prompt notice thereof to the
Banks. In the event of any Default, the Administrative Agent shall (a) in the
case of a Default that constitutes an Event of Default, take any or all of the
actions referred to in Section 6.02(a), Section 6.02(b) and Section 6.02(c) if
so directed by the Required Banks and (b) in the case of any Default, take such
other action with respect to such Default as shall be reasonably directed by
the Required Banks. Unless and until the Administrative Agent shall have
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received such directions, in the event of any Default, the Administrative Agent
may (but shall not be obligated to) take such action, or refrain from taking
such action, with respect to such Default as it shall deem advisable in the
best interests of the Banks.
Section 8.04. Rights as a Bank. Each Person acting as an
Agent that is also a Bank shall, in its capacity as a Bank, have the same
rights and powers under the Loan Documents as any other Bank and may exercise
the same as though it were not acting as an Agent, and the term "Bank" or
"Banks" shall include such Person in its individual capacity. Each Person
acting as an Agent and its Affiliates may (without having to account therefor
to any Bank) accept deposits from, lend money to and generally engage in any
kind of banking, trust or other business with the Loan Parties and their
Affiliates as if it were not acting as an Agent, and such Person and its
Affiliates may accept fees and other consideration from the Borrower and its
Affiliates for services in connection with the Loan Documents or otherwise
without having to account for the same to the Banks.
Section 8.05. Indemnification. The Banks agree to indemnify
each of the Agents (to the extent not reimbursed by the Loan Parties under the
Loan Documents), ratably on the basis of the respective principal amounts of
the Loans outstanding made by the Banks (or, if no Loans are at the time
outstanding, ratably on the basis of their respective Commitments), for any and
all Liabilities, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind and nature whatsoever that may be imposed
on, incurred by or asserted against such Agent in its capacity as an Agent
(including the costs and expenses that the Loan Parties are obligated to pay
under the Loan Documents) in any way relating to or arising out of the Loan
Documents or any other documents contemplated thereby or referred to therein or
the transactions contemplated thereby or the enforcement of any of the terms
thereof or of any such other documents, provided that no Bank shall be liable
for any of the foregoing to the extent they arise from gross negligence or
willful misconduct by such Agent.
Section 8.06. Non-Reliance on Agents and Other Banks. Each
Bank agrees that it has made and will continue to make, independently and
without reliance on any of the Agents or any other Bank, and based on such
documents and information as it deems appropriate, its own credit analysis of
the Loan Parties, its own evaluation of the Collateral and its own decision to
enter into the Loan Documents and to take or refrain from taking any action in
connection therewith. None of the Agents shall be required to keep itself
informed as to the performance or observance by the Loan Parties of the Loan
Documents or any other document referred to or provided for therein or to
inspect the properties or books of any Loan Party or any Subsidiary thereof or
the Collateral. Except for notices, reports and other documents and
information expressly required to be furnished to
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the Banks by the Administrative Agent under the Loan Documents, none of the
Agents shall have any obligation to provide any Bank with any information
concerning the business, status or condition of any Loan Party or any
Subsidiary thereof, the Loan Documents or the Collateral that may come into the
possession of such Agent or any of its Affiliates.
Section 8.07. Resignation of the Administrative Agent.
Subject to the appointment and acceptance of a successor Administrative Agent
as provided below, the Administrative Agent may resign at any time by giving
notice thereof to the Banks and the Borrower. Upon receipt of any such notice
of resignation, the Required Banks may, with the consent of the Borrower (which
consent shall not be unreasonably withheld), appoint any bank or financial
institution as the successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Required Banks and
shall have accepted such appointment within 30 days after the retiring
Administrative Agent's giving of notice of resignation, then the retiring
Administrative Agent may, on behalf of the Banks and with the consent of the
Borrower (which consent shall not be unreasonably withheld), appoint any bank
or financial institution as the successor Administrative Agent. Upon the
acceptance by any Person of its appointment as a successor Administrative
Agent, such Person shall thereupon succeed to and become vested with all the
rights, powers, privileges, duties and obligations of the retiring
Administrative Agent and the retiring Administrative Agent shall be discharged
from its duties and obligations as Administrative Agent under the Loan
Documents. After any retiring Administrative Agent's resignation as
Administrative Agent, the provisions of this Article 8 shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as the Administrative Agent.
ARTICLE 9
MISCELLANEOUS
Section 9.01. Notices and Deliveries.
(a) Manner of Delivery. All notices, communications and
materials (including all Information) to be given or delivered pursuant to the
Borrower Loan Documents shall, except in those cases where giving notice by
telephone is expressly permitted, be given or delivered in writing (which shall
include telecopy transmissions). Notices under Sections 1.02, 1.04(c), 1.06,
1.08 and 6.02 may be by telephone, promptly confirmed in writing. In the event
of a discrepancy between any telephonic notice and any written confirmation
thereof, such written confirmation shall be deemed the effective notice except
to the extent that the Administrative Agent has acted in reliance on such
telephonic notice.
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(b) Addresses. All notices, communications and materials to
be given or delivered pursuant to the Borrower Loan Documents shall be given or
delivered at the following respective addresses and telecopier and telephone
numbers and to the attention of the following individuals or departments:
(i) if to the Borrower, to it at:
1365 Enterprise Drive
West Chester, PA 19380
Telecopier No.: (610) 701-8974
Telephone No.: (610) 701-1380
Attention: General Counsel
with a copy to:
Comcast Corporation
1500 Market Street
Philadelphia, PA 19102-4735
Telecopier No.: (215) 981-7744
Telephone No.: (215) 981-7503
Attention: John R. Alchin, Senior
Vice President and Treasurer
and:
Tele-Communications, Inc.
5619 DTC Parkway
Englewood, CO 80111
Telecopier No.: (303) 488-3216
Telephone No.: (303) 267-5500
Attention: Chief Financial Officer
and:
Liberty Media Corporation
8101 E. Prentice Avenue, Suite 500
Englewood, CO 80111
Telecopier No.: (303) 721-5415
Telephone No.: (303) 721-5400
Attention: David Koff
(ii) if to the Administrative Agent or the Secured Party,
to it at:
One Wall Street
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16th Floor
New York, New York 10286
Telecopier No.: (212) 635-8593 or 8595
Telephone No.: (212) 635-8843
Attention: James W. Whitaker
with a copy to:
The Bank of New York
One Wall Street
18th Floor
New York, New York 10286
Telecopier No.: (212) 635-6365 or 6366
Telephone No.: (212) 635-4696
Attention: Patricia Clancy
(iii) if to any Bank (including any Bank in its capacity as
the Issuing Bank or the Swing Loan Lender), to it at
the address or telecopier or telephone number and to
the attention of the individual or department set
forth below such Bank's name under the heading
"Notice Address" on Annex A or, in the case of a Bank
that becomes a Bank pursuant to an assignment, set
forth under the heading "Notice Address" in the
Notice of Assignment given to the Borrower and the
Administrative Agent with respect to such assignment;
or at such other address or telecopier or telephone number or to the attention
of such other individual or department as the party to which such information
pertains may hereafter specify for the purpose in a notice specifically
captioned "Notice of Change of Address" given to (x) if the party to which such
information pertains is the Borrower, the Administrative Agent and each Bank,
(y) if the party to which such information pertains is the Administrative
Agent, the Borrower and each Bank and (z) if the party to which such
information pertains is a Bank, the Borrower and the Administrative Agent.
(c) Effectiveness. Each notice and communication and any
material to be given or delivered pursuant to the Borrower Loan Documents shall
be deemed so given or delivered (i) if sent by registered or certified mail,
postage prepaid, return receipt requested, on the third Business Day after such
notice, communication or material, addressed as above provided, is delivered to
a United States post office and a receipt therefor is issued thereby, (ii) if
sent by any other means of physical delivery, when such notice, communication
or material is delivered to the appropriate address as above provided, (iii) if
sent by telecopier, when such notice, communication or material
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is transmitted to the appropriate telecopier number as above provided and is
received at such number and (iv) if given by telephone, when communicated to
the individual or any member of the department specified as the individual or
department to whose attention notices, communications and materials are to be
given or delivered, or, in the case of notice by the Administrative Agent to
the Borrower under Section 6.02 given by telephone as above provided, if any
individual or any member of the department to whose attention notices,
communications and materials are to be given or delivered is unavailable at the
time, to any other officer of the Borrower, except that notices of a change of
address, telecopier or telephone number or individual or department to whose
attention notices, communications and materials are to be given or delivered
shall not be deemed given until received.
Section 9.02. Expenses; Indemnification. Whether or not any
Loans are made hereunder, the Borrower shall:
(a) pay or reimburse the Administrative Agent, the Issuing
Bank, the Swing Loan Lender and each Bank for all transfer, documentary, stamp
and similar taxes, and all recording and filing fees and taxes, payable in
connection with, arising out of, or in any way related to, the execution,
delivery and performance of the Loan Documents or the making of the Loans,
excluding any such taxes imposed as a result of the assignment of any Loan or
portion thereof;
(b) pay or reimburse the Administrative Agent for all
reasonable out-of-pocket costs and expenses (including reasonable fees and
disbursements of legal counsel collectively retained by the Managing Agents or,
other than with respect to clause (i) below, appraisers, accountants and other
experts employed or retained collectively by the Managing Agents or the
Administrative Agent) incurred by the Administrative Agent (or, in the case of
fees and disbursements of legal counsel, the Managing Agents) in connection
with, arising out of, or in any way related to (i) the negotiation,
preparation, execution and delivery of (A) the Loan Documents and (B) whether
or not executed, any waiver, amendment or consent thereunder or thereto, (ii)
the administration of and any operations under the Loan Documents, (iii)
consulting with respect to any matter in any way arising out of, related to, or
connected with, the Loan Documents, including (A) the protection or
preservation of the Collateral, (B) the protection, preservation, exercise or
enforcement of any of the rights of the Administrative Agent, the Issuing Bank,
the Swing Loan Lender or the Banks in, under or related to the Collateral or
the Loan Documents during a Default or (C) the performance of any of the
obligations of the Administrative Agent, the Issuing Bank, the Swing Loan
Lender or the Banks under or related to the Loan Documents, (iv) protecting or
preserving the Collateral or (v) protecting, preserving, exercising or
enforcing any of the rights of the Administrative Agent, the Issuing Bank, the
Swing Loan Lender or the Banks in,
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under or related to the Collateral or the Loan Documents during a Default,
including defending the Security Interest as a valid, perfected, first priority
security interest in the Collateral subject only to Permitted Liens;
(c) pay or reimburse each Bank, the Swing Loan Lender and the
Issuing Bank for all reasonable costs and expenses (including reasonable fees
and disbursements of legal counsel and other experts employed or retained by
such Bank) incurred by such Bank, the Swing Loan Lender or the Issuing Bank in
connection with, arising out of, or in any way related to protecting,
preserving, exercising or enforcing during a Default any of its rights in,
under or related to the Collateral or the Loan Documents; and
(d) indemnify and hold each Indemnified Person harmless from
and against all losses (including judgments, penalties and fines) suffered, and
pay or reimburse each Indemnified Person for all costs and reasonable expenses
(including reasonable fees and disbursements of legal counsel and other experts
employed or retained by such Indemnified Person) incurred, by such Indemnified
Person in connection with, arising out of or in any way related to (i) any Loan
Document Related Claim (whether asserted by such Indemnified Person or the
Borrower or any other Person), including the prosecution or defense thereof and
any litigation or proceeding with respect thereto (whether or not, in the case
of any such litigation or proceeding, such Indemnified Person is a party
thereto), or (ii) any investigation, governmental or otherwise, arising out of,
related to, or in any way connected with, the Loan Documents or the
relationships established thereunder, except that the foregoing indemnity shall
not be applicable to (A) any loss suffered by any Indemnified Person to the
extent such loss is determined by a judgment of a court that is binding on the
Borrower and such Indemnified Person, final and not subject to review on appeal
to be the result of acts or omissions on the part of such Indemnified Person
constituting gross negligence or willful misconduct or (B) any such losses,
costs and expenses incurred in connection with any examination of such
Indemnified Person by governmental authorities and arising other than with
respect to this Agreement and the Loans specifically.
Section 9.03. Amounts Payable Due upon Request for Payment.
All amounts payable by the Borrower under Section 9.02 and under the other
provisions of the Borrower Loan Documents shall, except as otherwise expressly
provided, be immediately due upon request for the payment thereof accompanied
by a certificate of the requesting Bank setting forth the basis for the request
and the computation for the amount thereof in reasonable detail.
Section 9.04. Remedies of the Essence. The various rights
and remedies of the Administrative Agent, the Issuing Bank, the Swing Loan
Lender and the Banks under the Borrower Loan Documents are of the essence of
those agreements, and, to the
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extent permitted under Applicable Law, the Administrative Agent, the Issuing
Bank, the Swing Loan Lender and the Banks shall be entitled to obtain a decree
requiring specific performance of each such right and remedy.
Section 9.05. Rights Cumulative. Each of the rights and
remedies of the Administrative Agent, the Issuing Bank, the Swing Loan Lender
and the Banks under the Loan Documents shall be in addition to all of their
other rights and remedies under the Loan Documents and Applicable Law, and
nothing in the Loan Documents shall be construed as limiting any such rights or
remedies.
Section 9.06. Confidentiality. Each Bank agrees to exercise
all reasonable efforts to keep any information delivered or made available by
any Transaction Party confidential from anyone other than persons employed or
retained by such Bank or an Affiliate of such Bank who are or are expected to
become engaged in evaluating, approving, structuring or administering the
Loans; provided, however, that nothing herein shall prevent any Bank from
disclosing such information (a) to any other Bank, (b) upon the order of any
court or administrative agency, (c) upon the request or demand of any
regulatory agency or authority having jurisdiction over such Bank, (d) that has
been publicly disclosed other than in breach hereof, (e) in connection with any
litigation relating to the Loans, this Agreement or any transaction
contemplated hereby to which any Bank, any Loan Party, the Issuing Bank, the
Swing Loan Lender or any Agent may be a party, (f) to the extent reasonably
required in connection with the exercise of any remedy hereunder, (g) to such
Bank's legal counsel and independent auditors and (h) to any actual or proposed
participant or assignee of all or any part of its Loans hereunder, if such
other Person, prior to such disclosure, agrees for the benefit of the
Transaction Parties to comply with the provisions of this Section 9.06.
Section 9.07. Amendments; Waivers. Any term, covenant,
agreement or condition of any Loan Document to which the Banks are party may be
amended, and any right under the Loan Documents may be waived, if, but only if,
such amendment or waiver is in writing and is signed by the Required Banks and,
if the rights and duties of the Administrative Agent, the Swing Loan Lender or
the Issuing Bank are affected thereby, by the Administrative Agent, the Swing
Loan Lender or the Issuing Bank, as the case may be, and by each Loan Party
that is a party thereto; provided, however, that no such amendment or waiver
shall be effective, unless in writing and signed by each Bank affected thereby,
to the extent it (a) changes the amount or extends the term of such Bank's
Commitment, (b) reduces the principal of or the rate of interest on such Bank's
Loans or Notes, the amount of such Bank's Letter of Credit Participations or
any fees payable to such Bank hereunder, (c) postpones any date fixed under
Sections 1.04(b), 1.05, 1.08 or 1.09 for, or reduces the amount of, any
scheduled reduction of Commitments or
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any scheduled payment of principal of or interest on such Bank's Loans, Notes
or Letter of Credit Participations or any fees payable to such Bank hereunder,
(d) releases any portion of the Collateral from the Security Interest or
releases any Guarantor from any of its obligations under the Guaranty
Agreement, (e) waives any material condition precedent under Section 2.01 or
2.02 (as Section 2.02 applies to the initial Loans hereunder) or (f) amends
this Section 9.07 or any provision of this Agreement requiring the consent or
other action of all of the Banks; provided further, however, that no amendment
or waiver of Sections 1.06(b), 1.15 or 9.07 that would have an effect on the
Term B Banks that is (x) adverse to the Term B Banks and (y) disproportionate
to the effect that such waiver or amendment would have on the Term A Banks, the
RC Banks and the Working Capital Banks shall be effective unless in writing and
signed by the Required Term B Banks. Unless otherwise specified in such
waiver, a waiver of any right under the Borrower Loan Documents shall be
effective only in the specific instance and for the specific purpose for which
given. No election not to exercise, failure to exercise or delay in exercising
any right, nor any course of dealing or performance, shall operate as a waiver
of any right of the Administrative Agent, the Issuing Bank, the Swing Loan
Lender or any Bank under the Borrower Loan Documents or Applicable Law, nor
shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right of the
Administrative Agent, the Issuing Bank, the Swing Loan Lender or any Bank under
the Borrower Loan Documents or Applicable Law.
Section 9.08. Set-Off; Suspension of Payment and Performance.
The Administrative Agent, the Issuing Bank, the Swing Loan Lender and each Bank
is hereby authorized by the Borrower, to the extent permitted under Applicable
Law, at any time and from time to time, without notice, (a) during any Event of
Default, to set off against, and to appropriate and apply to the payment of,
the Liabilities of the Borrower under the Borrower Loan Documents (whether
owing to such Person or to any other Person that is the Administrative Agent,
the Issuing Bank, the Swing Loan Lender or a Bank and whether matured or
unmatured, fixed or contingent or liquidated or unliquidated and including
amounts to which a Bank is entitled with respect to its Letter of Credit
Participations) any and all Liabilities owing by such Person to the Borrower
(whether payable in Dollars or any other currency, whether matured or unmatured
and, in the case of Liabilities that are deposits, whether general or special,
time or demand and however evidenced and whether maintained at a branch or
office located within or without the United States) and (b) during any Event of
Default, to suspend the payment and performance of such Liabilities owing by
such Person and, in the case of Liabilities that are deposits, to return as
unpaid for insufficient funds any and all checks and other items drawn against
such deposits.
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Section 9.09. Sharing of Recoveries. (a) Each Bank agrees
that, if, for any reason, including as a result of (i) the exercise of any
right of counterclaim, set-off, banker's lien or similar right, (ii) its claim
in any applicable bankruptcy, insolvency or other similar proceeding being
deemed secured by a Debt owed by it to any Loan Party, including a claim deemed
secured under Section 506 of the Bankruptcy Code, or (iii) the allocation of
payments by the Administrative Agent or any Loan Party in a manner contrary to
the provisions of Section 1.15, such Bank shall receive payment of a proportion
of the aggregate amount due and payable to it hereunder as principal, interest
or fees that is greater than the proportion received by any other Bank in
respect of the aggregate of such amounts due and payable to such other Bank
hereunder, then the Bank receiving such proportionately greater payment shall
purchase participations (which it shall be deemed to have done simultaneously
upon the receipt of such payment) in the rights of the other Banks hereunder so
that all such recoveries with respect to such amounts due and payable hereunder
(net of costs of collection) shall be pro rata; provided, however, that if all
or part of such proportionately greater payment received by the purchasing Bank
is thereafter recovered by or on behalf of any Loan Party from such Bank, such
purchases shall be rescinded and the purchase prices paid for such
participation shall be returned to such Bank to the extent of such recovery,
but without interest (unless the purchasing Bank is required to pay interest on
the amount recovered to the Person recovering such amount, in which case the
selling Bank shall be required to pay interest at a like rate). The Borrower
expressly consents to the foregoing arrangements and agrees that any holder of
a participation in any rights hereunder so purchased or acquired pursuant to
this Section 9.09(a) shall, with respect to such participation, to the extent
permitted under Applicable Law, be entitled to all of the rights of a Bank
under Sections 7.02, 9.02 and 9.08 and may exercise any and all rights of
set-off with respect to such participation as fully as though the Borrower were
directly indebted to the holder of such participation for Loans in the amount
of such participation.
(b) Notwithstanding anything to the contrary contained
herein, Section 9.09(a) shall not be deemed to limit each Bank's entitlement to
exercise any right of counterclaim, set-off, banker's lien or similar right
that it may have in respect of any Loan Party in any manner as it may choose
and to apply the amount subject to such exercise to the payment of Liabilities
of such Loan Party other than obligations subject to the sharing provisions of
Section 9.09(a).
Section 9.10. Assignments and Participations. (a)
Assignments. (i) The Borrower may not assign any of its rights or obligations
under the Borrower Loan Documents without the prior written consent of the
Administrative Agent, the Issuing Bank, the Swing Loan Lender and each Bank,
and no assignment of any such obligation shall release the Borrower therefrom
unless the Administrative Agent, the Issuing Bank, the Swing Loan Lender
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or each Bank, as applicable, shall have consented to such release in a writing
specifically referring to the obligation from which the Borrower is to be
released.
(ii) Each Bank may from time to time assign any or all of
its rights and obligations under the Loan Documents and with respect to the
Collateral to one or more banks or other financial institutions with the
consent of the Borrower, the Administrative Agent, the Swing Loan Lender and
the Issuing Bank (which consents shall not be unreasonably withheld); provided,
however, that no such assignment shall be effective unless and until (A) a
Notice of Assignment with respect thereto, duly executed by the assignor and
the assignee, shall have been given to the Borrower, the Administrative Agent,
the Swing Loan Lender and the Issuing Bank and (B) except in the case of an
assignment by the Bank or an Affiliate thereof that is the Administrative Agent
or an assignment by any Bank to an Affiliate of such Bank, the Administrative
Agent shall have been paid an assignment fee of $2,500; provided further,
however, that (A) no such partial assignment, other than a partial assignment
by any Bank to an Affiliate of such Bank, shall be made or shall be effective
unless (x) if such assignment is made other than to another Bank, the amount
thereof is not less than $5,000,000 (so long as, in the case of any such
assignment to an assignee that is not already a Bank, the aggregate amount
assigned to such assignee at such time is not less than $10,000,000) and (y)
after giving effect to such assignment and all other assignments made and
participations granted by such Bank, the Commitment (or, if the Commitments
shall have terminated, the Loans), net of the amount of such participations,
retained by such Bank is not less than (1) in the case of each Managing Agent,
20% of the Commitment of such Managing Agent in effect on the Agreement Date
and (2) in the case of each other Bank, the lesser of (I) $25,000,000 and (II)
the greater of (aa) 50% of the Commitment of such Bank in effect on the
Agreement Date or, if such Bank became a Bank pursuant to an assignment, on the
day it became a Bank and (bb) $10,000,000 and (B) any assignment of any Term A
Loans, Term A Commitments, RC Loans, RC Commitments, Working Capital Loans or
Working Capital Commitments to any assignee shall include a pro rata portion of
all of the Term A Loans, Term A Commitments, RC Loans, RC Commitments, Working
Capital Loans and Working Capital Commitments of the assignor, unless otherwise
consented to by the Borrower (such consent not to be unreasonably withheld).
Any such assignment by a Bank of any or all of its obligations under the
Borrower Loan Documents shall release such Bank from the obligations so
assigned. In the event of any such assignment by a Bank, the Borrower shall,
against receipt of the existing Notes of the assignor Bank, issue new Notes to
the assignee Bank and, in the case of a partial assignment, to the assignor
Bank, appropriately reflecting such assignment. Nothing in this Section 9.10
shall limit the right of any Bank to assign its interest in the Loans and Notes
to a Federal Reserve Bank as collateral security under Regulation A of the
Board of Governors
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of the Federal Reserve System, but no such assignment shall release such Bank
from its obligations hereunder.
(b) Participations. Each Bank may from time to time sell or
otherwise grant participations in any or all of its rights and obligations
under the Borrower Loan Documents and with respect to the Collateral without
the consent of the Borrower, the Administrative Agent, the Issuing Bank, the
Swing Loan Lender or any other Bank; provided, however, that (A) no such
participation, other than a participation sold or granted by any Bank to an
Affiliate of such Bank, shall be made or shall be effective unless (x) the
amount thereof is not less than $5,000,000 and (y) after giving effect to such
participation and all other participations granted and assignments made by such
Bank, the Commitment (or, if the Commitments shall have terminated, the Loans),
net of the amount of such participations, retained by such Bank is not less
than (1) in the case of each Managing Agent, 20% of the Commitment of such
Managing Agent in effect on the Agreement Date and (2) in the case of each
other Bank, the lesser of (I) $25,000,000 and (II) the greater of (aa) 50% of
the Commitment of such Bank in effect on the Agreement Date or, if such Bank
became a Bank pursuant to an assignment, on the day it became a Bank and (bb)
$10,000,000. No sale by a Bank of any participation shall relieve such Bank of
any of its obligations to the Borrower hereunder.
(c) Rights of Assignees and Participants. Each assignee of,
and each holder of a participation in, the rights of any Bank under the
Borrower Loan Documents and with respect to the Collateral, if and to the
extent the applicable assignment or participation agreement so provides, (i)
shall, in the case of assignees and with respect to its assignment, be entitled
to all of the rights of a Bank and (ii) may, to the extent permitted under
Applicable Law, exercise any and all rights of set-off or banker's lien with
respect thereto (as fully, in the case of a holder of a participation, as
though the Borrower were directly indebted to such holder for amounts payable
under the Borrower Loan Documents to which such holder is entitled under the
applicable participation agreement); provided, however, that each such
participation agreement shall provide that the Bank that shall have sold or
granted the participation shall retain the sole right to take or refrain from
taking any action under the Loan Documents except that such participation
agreement may provide that such Bank shall not, without the consent of the
participant, agree to any amendment or waiver that would have any of the
effects described in the proviso to the first sentence of Section 9.07, to the
extent that the participant would be affected thereby. All amounts payable to
any Bank under Section 1.13 or Article 7 shall be determined as if such Bank
had not sold any participations. Each Bank that sells or grants a
participation shall (A) withhold or deduct from each payment to the holder of
such participation the amount of any Tax required under Applicable Law to be
withheld or deducted from such payment and not withheld or deducted therefrom
by the Borrower or the
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Administrative Agent, (B) pay any Tax so withheld or deducted by it to the
appropriate taxing authority in accordance with Applicable Law and (C)
indemnify the Borrower and the Administrative Agent for any losses, costs and
expenses that they may incur as a result of any failure to so withhold or
deduct and pay such Tax.
Section 9.11. Governing Law. This Agreement and the Notes
(including matters relating to the Maximum Permissible Rate) shall be construed
in accordance with and governed by the law of the State of New York (without
giving effect to its choice of law principles, other than Sections 5-1401 and
5-1402 of the General Obligations Law of the State of New York).
Section 9.12. Judicial Proceedings; Waiver of Jury Trial.
Any judicial proceeding brought against the Borrower with respect to any Loan
Document Related Claim may be brought in any court of competent jurisdiction in
the City of New York, and, by execution and delivery of this Agreement, the
Borrower (a) accepts, generally and unconditionally, the nonexclusive
jurisdiction of such courts and any related appellate court and irrevocably
agrees to be bound by any judgment rendered thereby in connection with any Loan
Document Related Claim and (b) to the extent permitted under Applicable Law,
irrevocably waives any objection it may now or hereafter have as to the venue
of any such proceeding brought in such a court or that such a court is an
inconvenient forum. The Borrower hereby waives personal service of process and
consents that service of process upon it may be made by certified or registered
mail, return receipt requested, at its address specified or determined in
accordance with the provisions of Section 9.01(b)(i), and service so made shall
be deemed completed on the third Business Day after such service is deposited
in the mail. Nothing herein shall affect the right of any Agent, Bank, the
Swing Loan Lender or the Issuing Bank or any other Indemnified Person to serve
process in any other manner permitted by law or shall limit the right of any
Agent, Bank, the Swing Loan Lender or the Issuing Bank or any other Indemnified
Person to bring proceedings against the Borrower in the courts of any other
jurisdiction. To the extent permitted in accordance with Applicable Law
(including Applicable Law relating to jurisdiction and venue), any judicial
proceeding by the Borrower against the Administrative Agent, the Issuing Bank,
the Swing Loan Lender or any Bank involving any Loan Document Related Claim
shall be brought only in a court located in the City and State of New York.
THE BORROWER, THE AGENTS, THE ISSUING BANK, THE SWING LOAN LENDER AND EACH BANK
HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING ANY LOAN
DOCUMENT RELATED CLAIM.
Section 9.13. Severability of Provisions. Any provision of
the Borrower Loan Documents that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions
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thereof or affecting the validity or enforceability of such provision in any
other jurisdiction.
Section 9.14. Counterparts. This Agreement may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures hereto and thereto were upon the same instrument.
Section 9.15. Survival of Obligations. Except as otherwise
expressly provided therein, the obligations of the Borrower under Sections
1.13, 7.02, 7.03, 7.04 and 9.02, and the obligations of the Banks under
Sections 8.05 and 9.06, shall survive the Repayment Date and the termination of
the Security Interest.
Section 9.16. Entire Agreement. This Agreement, the Notes
and the other Loan Documents embody the entire agreement among the Borrower,
the Agents, the Swing Loan Lender, the Issuing Bank and the Banks relating to
the subject matter hereof and supersede all prior agreements, representations
and understandings, if any, relating to the subject matter hereof.
Section 9.17. Successors and Assigns. All of the provisions
of this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns.
Section 9.18. Reference Banks. Each Reference Bank shall
furnish to the Administrative Agent timely information for the purpose of
determining the Eurodollar Rate. If any Reference Bank shall notify the
Administrative Agent that thenceforth it shall not be able to furnish such
information in a timely manner or shall assign all of its Loans or Commitment
to a Person that is not an Affiliate of such Reference Bank, the Administrative
Agent shall, with the consent of the Required Banks and after consultation with
the Borrower, appoint another Bank (which Bank, or, in the event that the
long-term debt securities of such Bank shall not be rated by a
nationally-recognized credit rating agency, the parent holding company in the
corporate group of which such Bank is a member, shall have a credit rating with
respect to long-term debt securities from a nationally-recognized credit rating
agency substantially equivalent to the Bank, or the parent holding company in
the corporate group of which such Bank is a member, being replaced) as a
Reference Bank in place of such Reference Bank.
Section 9.19. Cash Collateral. If, at any time, payment,
prepayment or cash collateralization of Contingent Reimbursement Obligations
shall be required pursuant to any provision of any of the Loan Documents, such
payment, prepayment or cash collateralization shall be made by deposit of funds
in Dollars, in the amount of such payment, prepayment or cash
collateralization, into a cash collateral account at the Administrative Agent's
Office, which account shall be under the
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sole dominion and control of the Administrative Agent and is hereby pledged to
the Administrative Agent for the benefit of itself, the Banks and the Issuing
Bank as security for the payment of the Contingent Reimbursement Obligations
and any other amounts that may become payable hereunder. Funds deposited in
such account, and any income thereon, may be applied by the Administrative
Agent against amounts payable under the Loan Documents as such amounts become
due. Any funds remaining in such account when all Contingent Reimbursement
Obligations and other amounts payable under the Loan Documents have been paid
and the Repayment Date shall have occurred shall be promptly remitted to the
Borrower.
ARTICLE 10
INTERPRETATION
Section 10.01. Definitional Provisions. (a) Defined Terms.
For the purposes of this Agreement:
"Accumulated Funding Deficiency" has the meaning ascribed to
such term in Section 302 of ERISA.
"Acquisition Corp." means QVC Programming Holdings, Inc.
(formerly known as Comcast QMerger, Inc.), a Delaware corporation.
"Administrative Agent" means The Bank of New York, as
Administrative Agent for the Banks under the Loan Documents, and any successor
Administrative Agent appointed pursuant to Section 8.07.
"Administrative Agent's Office" means the address of the
Administrative Agent specified in or determined in accordance with the
provisions of Section 9.01(b)(ii).
"Affiliate" means, with respect to a Person, any other Person
that, directly or indirectly through one or more intermediaries, controls, or
is controlled by, or is under common control with, such first Person; unless
otherwise specified, "Affiliate" means an Affiliate of the Borrower. As used
in this definition, "control" (including, with correlative meanings,
"controlled by" and "under common control with") means possession, directly or
indirectly, of power to direct or cause the direction of management or policies
(whether through ownership of securities or partnership or other ownership
interests, by Contract or otherwise); provided, however, that, in any event,
any Person that owns directly or indirectly Capital Securities having 15% or
more of the ordinary voting power for the election of directors or other
governing body of a corporation or 15% or more of the partnership or other
ownership interests in any other Person (other than as a limited partner of
such other Person) will be deemed to control such corporation or other Person.
Notwithstanding the foregoing, no individual shall
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be deemed to be an Affiliate of a Person solely by reason of such individual
being an officer or director of such Person.
"Affiliate Subordinated Indebtedness" has the meaning ascribed
to such term in the Affiliate Subordination Agreement, and, as provided
therein, includes accrued Management Fees and Junior Subordinated Indebtedness.
"Affiliate Subordination Agreement" means the Affiliate
Subordination Agreement, dated as of the date hereof, among the Borrower,
Comcast, Liberty, Affiliates of Comcast or Liberty from time to time party
thereto and the Administrative Agent.
"Agent" means the Administrative Agent or any of the Managing
Agents.
"Agreement" means this Agreement, including all Schedules,
Annexes and Exhibits hereto.
"Agreement Date" means the date set forth as such on the last
signature page hereof, which date is the date that executed copies of this
Agreement were delivered by all parties hereto and, accordingly, this Agreement
became effective.
"Applicable Law" means, anything in Section 9.11 to the
contrary notwithstanding, (i) all applicable common law and principles of
equity and (ii) all applicable provisions of all (A) constitutions, statutes,
rules, regulations and orders of governmental bodies, (B) Governmental
Approvals and (C) orders, decisions, judgments and decrees of all courts
(whether at law or in equity or admiralty) and arbitrators.
"Applicable Margin" means: (i) with respect to Term B Loans,
at any time, 1.875%, in the case of Base Rate Loans, and 3.000%, in the case of
Eurodollar Rate Loans, and (ii) with respect to the Term A Loans, the RC Loans
and the Working Capital Loans, at any time, the respective percentage set forth
below under the caption for the applicable Type of Loan opposite the applicable
Leverage Ratio at such time set forth below:
<TABLE>
<CAPTION>
Eurodollar
Leverage Ratio Base Rate Rate
-------------- --------- ----------
<S> <C> <C>
- 5.00 to 1 1.125% 2.250%
- 4.50 to 1 but < 5.00 to 1 0.750% 1.875%
- 4.00 to 1 but < 4.50 to 1 0.500% 1.625%
- 3.50 to 1 but < 4.00 to 1 0.125% 1.250%
- 3.00 to 1 but < 3.50 to 1 0.000% 1.000%
< 3.00 to 1 0.000% 0.875%
</TABLE>
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The Leverage Ratio shall be determined initially on the basis of the
certificate provided for in Section 2.01(g) and subsequently on the basis of
the most recent financial statements delivered pursuant to Section 5.01. Any
change in the Applicable Margin as a result of a change in the Leverage Ratio
shall be effective as of the third Business Day after the day on which
financial statements are delivered to the Administrative Agent pursuant to
Section 5.01 that indicate such change in the Leverage Ratio.
"Assumption Agreement" means the Assumption Agreement, dated
the date of the making of the initial Loans (or, if no Loans have been made,
the issuance of the initial Letter of Credit), between QVC and the
Administrative Agent, in the form of Exhibit B.
"Bank" means (i) any Person listed on the signature pages
hereof following the Administrative Agent and (ii) any Person that has been
assigned any or all of the rights or obligations of a Bank pursuant to Section
9.10(a).
"Bank Nonparticipation" means (i) the inability of any Working
Capital Bank to acquire any Letter of Credit Participation pursuant to Section
1.03(e) or to make any payment required by it under Section 1.03(h) because of
such Bank's having been subject to receivership, insolvency or other similar
laws, (ii) the refusal of any Working Capital Bank to acquire any Letter of
Credit Participation pursuant to Section 1.03(e) or to make any payment
required by it under Section 1.03(h) or (iii) the giving by any Working Capital
Bank to the Issuing Bank of any notice (which has not been retracted) of its
intention not to so acquire any Letter of Credit Participation or to make any
such required payment.
"Bank Tax" means (i) any Tax based on or measured by net
income, any franchise Tax and any doing business Tax imposed upon the Issuing
Bank, the Swing Loan Lender, any Bank or any Agent by any jurisdiction (or any
political subdivision thereof) in which the Issuing Bank, the Swing Loan
Lender, such Bank, such Agent or any Lending Office is organized, located or
doing business and (ii) for the purposes of Section 1.13, any other Tax imposed
by a jurisdiction other than the United States or a political subdivision
thereof that would not have been imposed but for a present or former connection
between the Issuing Bank, the Swing Loan Lender, Bank, Agent or Lending Office
(as the case may be) and such jurisdiction.
"Base Financial Statements" means the consolidated balance
sheet of QVC and its Consolidated Subsidiaries as of January 31, 1994 and the
related statements of income, retained earnings and cash flows for the fiscal
year ended with the date of such balance sheet.
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"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate in effect on such day and (ii) the Federal Funds
Rate in effect on such day plus 1/2%.
"Base Rate Loan" means any Loan the interest on which is, or
is to be, as the context may require, computed on the basis of the Base Rate.
"Benefit Plan" means, with respect to any Person at any time,
any employee pension benefit plan (including a Multiemployer Benefit Plan)
which is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code, the funding requirements of which
(under Section 302 of ERISA or Section 412 of the Code) are, or at any time
within five years preceding the time in question were, in whole or in part, the
responsibility of such Person.
"Borrower" means (i) prior to the execution of the Assumption
Agreement, QVC Programming Holdings, Inc., a Delaware corporation and (ii) at
all times thereafter, QVC.
"Borrower Loan Documents" means the Loan Documents to which
the Borrower is a party.
"Business Day" means any day other than a Saturday, Sunday or
other day on which banks in New York City are authorized to close.
"Capital Security" means, with respect to any Person, (i) any
share of capital stock of such Person or (ii) any security convertible into, or
any option, warrant or other right to acquire, any share of capital stock of
such Person.
"Cash Flow" means, as of any date of determination, (i) the
operating income (which shall be consolidated, as appropriate and shall include
income (net of expenses) derived from credit card operations) of the Borrower
and the Consolidated Subsidiaries, for the four consecutive fiscal quarters of
the Borrower ending on, or most recently ended prior to, such date, plus (ii)
Management Fees accrued and not paid in cash, Q2/On Q Net Operating Costs (for
the period (A) from and including the first day of the period of four
consecutive fiscal quarters of the Borrower ending on, or most recently ended
prior to, the Agreement Date to (B) January 31, 1997, up to a maximum of
$25,000,000 but only to the extent deducted in determining operating income),
depreciation, amortization and all other non-cash charges to income and
extraordinary items (to the extent deducted in determining operating income),
for such period plus (iii) to the extent deducted in determining operating
income for such period, compensation expense associated with cash payments made
in exchange for the surrender of employee stock options in connection with the
Tender Offer or the Merger minus (iv) except to the extent deducted in
determining such operating income, Management Fees paid in cash during such
period.
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"Closing Date" means the date of the making of the initial
Loans hereunder.
"Code" means the Internal Revenue Code of 1986.
"Collateral" means all property in which a Lien is created
pursuant to the Loan Documents.
"Comcast" means Comcast Corporation, a Pennsylvania
corporation.
"Commitment" means, with respect to any Bank, such Bank's Term
A Commitment, Term B Commitment, RC Commitment and Working Capital Commitment.
"Consolidated Indebtedness" means, at any time, the
consolidated Indebtedness of the Borrower and the Consolidated Subsidiaries
(other than Junior Subordinated Indebtedness) plus all Permitted Holdco
Replacement Debt, to the extent such Permitted Holdco Replacement Debt is such
pursuant to clause (i)(A)(y) of the definition thereof, in each case as of such
time.
"Consolidated Subsidiary" means, with respect to any Person at
any time, any Subsidiary or other Person the accounts of which would be
consolidated with those of such first Person in its consolidated financial
statements as of such time; unless otherwise specified, "Consolidated
Subsidiary" means a Consolidated Subsidiary of the Borrower.
"Contingent Reimbursement Obligation" means the contingent
obligation of the Borrower to reimburse the Issuing Bank for any Drawings that
may in the future be made under an outstanding Letter of Credit, whenever
issued. Without limiting the foregoing, the amount of all Contingent
Reimbursement Obligations at any time shall be the aggregate amount available
to be drawn under outstanding Letters of Credit at such time.
"Contract" means (i) any agreement (whether executory or
non-executory and whether a Person entitled to rights thereunder is so entitled
directly or as a third-party beneficiary), including an indenture, lease or
license, (ii) any deed or other instrument of conveyance, (iii) any certificate
of incorporation or charter and (iv) any by-law.
"Cure Date" has the meaning ascribed to such term in Section
6.03.
"Debt" means any Liability that constitutes "debt" or "Debt"
under Section 101(11) of the Bankruptcy Code or under the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any analogous Applicable
Law.
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"Default" means any condition or event that constitutes an
Event of Default or that with the giving of notice or lapse of time or both
would, unless cured or waived, become an Event of Default.
"Dollars" and the sign "$" mean lawful money of the United
States of America.
"Domestic Lending Office" means, with respect to any Bank or
the Swing Loan Lender, (i) the branch or office of such Bank or the Swing Loan
Lender set forth below such Bank's or the Swing Loan Lender's name under the
heading "Domestic Lending Office" on Annex A or, in the case of a Bank that
becomes a Bank pursuant to an assignment, the branch or office of such Bank set
forth under the heading "Domestic Lending Office" in the Notice of Assignment
given to the Borrower and the Administrative Agent with respect to such
assignment or (ii) such other branch or office of such Bank or the Swing Loan
Lender designated by such Bank or the Swing Loan Lender from time to time as
the branch or office at which its Base Rate Loans and Letter of Credit
Participations or Swing Loans, as the case may be, are to be made or
maintained.
"Drawing" means (a) any amount disbursed by the Issuing Bank
pursuant to the terms of any Letter of Credit or (b) as the context may
require, the obligation of the Borrower to reimburse the Issuing Bank for such
disbursement.
"Environmental Laws" means any and all Federal, state, local
and foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
other governmental restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment, including ambient air, surface water, ground water or land, or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or waste.
"ERISA" means the Employee Retirement Income Security Act of
1974.
"ERISA Affiliate" means, with respect to any Person, any other
Person, including a Subsidiary or other Affiliate of such first Person, that is
a member of any group of organizations within the meaning of Section 414(b),
(c), (m) or (o) of the Code of which such first Person is a member.
"Eurodollar Business Day" means any Business Day on which
dealings in Dollar deposits are carried on in the London interbank market and
on which commercial banks are open for
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domestic and international business (including dealings in Dollar deposits) in
London, England.
"Eurodollar Lending Office" means, with respect to any Bank,
(i) the branch or office of such Bank set forth below such Bank's name under
the heading "Eurodollar Lending Office" on Annex A or, in the case of a Bank
that becomes a Bank pursuant to an assignment, the branch or office of such
Bank set forth under the heading "Eurodollar Lending Office" in the Notice of
Assignment given to the Borrower and the Administrative Agent with respect to
such assignment or (ii) such other branch or office of such Bank designated by
such Bank from time to time as the branch or office at which its Eurodollar
Rate Loans are to be made or maintained.
"Eurodollar Rate" means, for any Interest Period, the rate per
annum determined by the Administrative Agent to be the average (rounded upward,
if necessary, to the next higher 1/100 of 1%) of the rates per annum
determined, respectively, by each Reference Bank to be the rate at which such
Reference Bank offered or would have offered, at 11:00 a.m. (London time) on
the second Eurodollar Business Day before the first day of such Interest
Period, to place with first-class banks in the London interbank market on the
first day of such Interest Period deposits in Dollars in amounts comparable to
the Eurodollar Rate Loan of such Reference Bank to which such Interest Period
applies, for a period equal to such Interest Period. If any Reference Bank is
unable or otherwise fails to furnish the Administrative Agent with appropriate
rate information in a timely manner, the Administrative Agent shall determine
the Eurodollar Rate based on the rate information furnished by the remaining
Reference Banks.
"Eurodollar Rate Loan" means any Loan the interest on which
is, or is to be, as the context may require, computed on the basis of the
Eurodollar Rate.
"Event of Default" means any of the events specified in
Section 6.01.
"Excess Capital Expenditures" means any capital expenditures
funded in any fiscal year of the Borrower out of Excess Cash Flow for any
previous fiscal year ending after January 31, 1996, but only to the extent that
such Excess Cash Flow had not been previously applied in accordance with, or
otherwise been the basis for, prepayments of the Loans, Restricted Payments,
acquisitions or investments pursuant to, Section 1.06(b)(i), 4.06(a),
4.07(f)(ii) or 4.14(m)(ii), respectively.
"Excess Cash Flow" means, for any fiscal year of the Borrower,
the amount, if any, by which Cash Flow for such fiscal year exceeds the sum of,
in each case for the Borrower and the Consolidated Subsidiaries, on a
consolidated basis, for such
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fiscal year, (i) Interest Expense, (ii) capital expenditures (other than Excess
Capital Expenditures), (iii) payments of principal on the Term Loans and all
Required RC Repayments (other than payments made in accordance with Section
1.06(b)), (iv) Taxes paid or payable in cash less all cash refunds in respect
of Taxes, (v) cash investments under Section 4.14(m) (other than cash
investments contemplated by Section 4.14(m)(ii)) and cash acquisitions (other
than cash acquisitions contemplated by Section 4.07(f)(ii)), (vi) payments
under affiliation agreements (to the extent not deducted in determining
operating income), (vii) Q2/On Q Net Operating Costs (to the extent added to
operating income in determining such Cash Flow pursuant to clause (ii) of the
definition of Cash Flow), (viii) cash payments in respect of extraordinary
items (to the extent deducted in determining operating income) and (ix)
$10,000,000. For purposes of this definition, "Required RC Repayments" means,
for any fiscal year of the Borrower, the excess, if any, of (x) the outstanding
amount of RC Loans on the first day of such fiscal year over (y) the Total RC
Commitment on the last day of such fiscal year (without giving effect to any
mandatory reduction of the Total RC Commitment pursuant to Section 1.08(c)(i)
hereof).
"Existing Benefit Plan" means any Benefit Plan listed on
Schedule 3.13.
"Existing Guaranty" means (i) any Guaranty outstanding on the
Agreement Date, to the extent (in the case of any such Guaranty in an amount
greater than $250,000) set forth on Schedule 4.04, and (ii) any Guaranty that
constitutes a renewal, extension or replacement of an Existing Guaranty, but
only if (A) at the time such Guaranty is entered into and after giving effect
thereto, no Event of Default would exist, (B) such Guaranty is binding only on
the obligor or obligors under the Guaranty so renewed, extended or replaced,
(C) the principal amount of the obligations Guaranteed by such Guaranty does
not exceed the principal amount of the obligations Guaranteed by the Guaranty
so renewed, extended or replaced and (D) the obligations Guaranteed by such
Guaranty bear interest at a rate per annum not exceeding the rate borne by the
obligations Guaranteed by the Guaranty so renewed, extended or replaced except
for any increase that is commercially reasonable at the time of such increase.
"Existing Investment" means any investment outstanding on the
Agreement Date, to the extent (in the case of any investment in an amount
greater than $250,000) set forth on Schedule 4.14, and any renewal or extension
thereof not involving an increase therein as the result of an additional
investment by the Borrower or any Subsidiary.
"Fair Saleable Value" has the meaning ascribed to such term in
Section 3.11.
"Federal Funds Rate" means, for any day, the weighted average
of the rates on overnight Federal funds transactions with
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members of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York or, if such
rate is not so published for any day that is a Business Day, the average of
quotations for such day on such transactions received by The Bank of New York
from three Federal funds brokers of recognized standing selected by such bank.
"Fixed Charge Coverage Ratio" means, as of any date of
determination, the ratio of (a) the sum of (i) Cash Flow at such date, (ii) the
aggregate unused and available amount of the RC Commitments and the Working
Capital Commitments at such time, up to a maximum of $20,000,000 at any time
prior to February 1, 1996, $15,000,000 at any time from and including February
1, 1996 through and including January 31, 1997 and $10,000,000 at any time from
and including February 1, 1997 though and including January 31, 1998, and
thereafter, zero, and (iii) the aggregate amount of dividends and other
payments received in cash by the Borrower or any Consolidated Subsidiary from
any Subsidiary that is not a Consolidated Subsidiary during the four
consecutive fiscal quarters of the Borrower ending on, or most recently ended
prior to, such date to (b) the sum of, in each case for the four consecutive
fiscal quarters of the Borrower ending on, or most recently ended prior to,
such date, (i) Interest Expense, (ii) capital expenditures (other than Excess
Capital Expenditures), (iii) cash investments under Section 4.14(m) (other than
cash investments contemplated by Section 4.14(m)(ii)) and cash acquisitions
(other than cash acquisitions contemplated by Section 4.07(f)(ii)), (iv)
payments under affiliation agreements (to the extent not deducted in
determining operating income), (v) Q2/On Q Net Operating Costs (to the extent
added to operating income in determining such Cash Flow pursuant to clause (ii)
of the definition of Cash Flow), (vi) Taxes (other than Taxes deducted in
determining operating income) paid or payable in cash less all cash refunds in
respect of Taxes and (vii) all payments of principal on the Term Loans (other
than payments made in accordance with Section 1.06) and all Required RC
Repayments (as such term is defined in the definition of "Excess Cash Flow"
above).
"GECC Agreement" means the credit card programs agreement,
dated as of March 4, 1988, by and between General Electric Capital Corporation
and CVN Companies, Inc., as amended by the Addendum, dated March 2, 1990, the
Second Addendum, dated March 30, 1990, the Third Addendum, dated April 17, 1990
and the Fourth Addendum, dated April 25, 1990, each by and among CVN Companies,
Inc., C.O.M.B. Direct Marketing Corp., Cable Value Network, Inc., the Borrower
and General Electric Capital Corporation.
"Generally Accepted Accounting Principles" means (i) in the
case of the Base Financial Statements, generally accepted accounting principles
at the time of the issuance of the Base
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Financial Statements and (ii) in all other cases, the accounting principles
followed in the preparation of the Base Financial Statements, except as
provided in Section 10.02.
"Governmental Approval" means any authorization, consent,
approval, license or exemption of, registration or filing with, or report or
notice to, any governmental unit.
"Guarantor" means any of the Material Subsidiaries.
"Guaranty" means, with respect to any Person, any contractual
obligation, contingent or otherwise, of such Person (i) to pay any Indebtedness
or other obligation of any other Person or to otherwise protect the holder of
any such Indebtedness or other obligation against loss (whether such obligation
arises by agreement to pay, to keep well, to purchase assets, goods, securities
or services or otherwise) or (ii) incurred in connection with the issuance by a
third Person of a Guaranty of any Indebtedness or other obligation of any other
Person (whether such obligation arises by agreement to reimburse or indemnify
such third Person or otherwise by Contract); provided, however, that the term
"Guaranty" shall not include an endorsement for collection or deposit in the
ordinary course of business. The word "Guarantee" when used as a verb has the
correlative meaning.
"Guaranty Agreement" means any of the Guaranty Agreements,
dated as of the date hereof or hereinafter entered into, between the Material
Subsidiaries and the Administrative Agent.
"Hazardous Material" means any oil, hazardous waste, hazardous
material or hazardous substance listed, defined or otherwise identified as
hazardous in the Resource Conservation and Recovery Act, 42 U.S.C. Section
6921 et seq., the Comprehensive Environmental Response Compensation and
Liability Act, 42 U.S.C. Section 9601 et seq., or any other Federal or state
Environmental Law.
"Holdco" means any Person (i) of which substantially all the
Capital Securities after its formation are owned by holders of Capital
Securities of the Borrower, in substantially the same proportion, immediately
prior to its formation, and (ii) which, immediately following its formation and
at all times thereafter, owns all of the Capital Securities of the Borrower.
"Indebtedness" means, with respect to any Person (in each
case, whether such obligation is with full or limited recourse), without
duplication, (i) any obligation of such Person for borrowed money, (ii) any
obligation of such Person evidenced by a bond, debenture, note or other similar
instrument, (iii) any obligation of such Person to pay the deferred purchase
price of property or services, except (A) a trade account payable that arises
in the ordinary course of business but only if and so long as the same is
payable on customary trade terms and (B) unpaid
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Management Fees, (iv) any obligation of such Person as lessee under a capital
lease, (v) any Mandatorily Redeemable Securities of such Person owned by any
Person other than such Person or a Wholly Owned Subsidiary of such Person (the
amount of such Mandatorily Redeemable Securities to be determined for this
purpose as the higher of the liquidation preference of and the amount payable
upon redemption of such Mandatorily Redeemable Securities), (vi) any obligation
of such Person to purchase securities or other property that arises out of or
in connection with the sale of the same or substantially similar securities or
property, (vii) any contractual obligation, contingent or otherwise, of such
Person to reimburse any other Person in respect of amounts paid under a letter
of credit or performance or other bond issued by such other Person (other than
bonds issued in connection with (A) sweepstakes programs arising in the
ordinary course of business and (B) liabilities for state sales or use taxes
incurred in the ordinary course of business), (viii) any Indebtedness of others
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) a Lien on any asset of such Person
and (ix) any Indebtedness of others Guaranteed by such Person; provided that
letters of credit issued in support of workman's compensation or other
insurance programs shall not constitute Indebtedness for purposes of this
Agreement.
"Indemnified Person" means, at any time, any Person that is,
or at such time was, the Administrative Agent, any other Agent, the Issuing
Bank, the Swing Loan Lender, a Bank, an Affiliate of the Administrative Agent,
any other Agent, the Issuing Bank, the Swing Loan Lender or a Bank or a
director, officer, employee or agent of any such Person.
"Information" means written data, certificates, reports,
statements (excluding financial statements), documents and other written
information.
"Installment Payment Date" means the last Eurodollar Business
Day of each January, April, July and October.
"Intellectual Property" means (i) (A) patents and patent
rights, (B) trademarks, trademark rights, trade names, trade name rights,
corporate names, business names, trade styles, service marks, logos and general
intangibles of like nature and (C) copyrights, in each case whether registered,
unregistered or under pending registration and, in the case of any such that
are registered or under pending registration, whether registered or under
pending registration under the laws of the United States or any other country,
(ii) reissues, continuations, continuations-in-part and extensions of any
Intellectual Property referred to in clause (i) above and (iii) rights relating
to any Intellectual Property referred to in clause (i) or (ii) above, including
rights under applications (whether pending under the laws of the United States
or any other country) or licenses relating thereto.
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"Interest Coverage Ratio" means, as of any date of
determination, the ratio of (i) Cash Flow at such date to (ii) Designated
Interest Expense. For purposes of this definition, "Designated Interest
Expense" shall mean (A) at any time prior to the last day of the first full
fiscal quarter following the fiscal quarter in which the Closing Date shall
have occurred, the annualized interest expense for the period from the Closing
Date until the date of determination, (B) at any time from and including the
last day of such first full fiscal quarter to but excluding the last day of the
second full fiscal quarter following the Closing Date, four times the Interest
Expense for such first full fiscal quarter, (C) at any time from and including
the last day of such second full fiscal quarter to but excluding the last day
of the third full fiscal quarter following the Closing Date, two times the
Interest Expense for such first two full fiscal quarters, (D) at any time from
and including the last day of such third full fiscal quarter to but excluding
the last day of the fourth full fiscal quarter following the Closing Date, the
Interest Expense for such first three full fiscal quarters divided by 0.75 and
(E) at any time on or after the last day of such fourth full fiscal quarter,
the Interest Expense for the four consecutive fiscal quarters of the Borrower
ending on, or most recently ended prior to, such date.
"Interest Expense" means, for any Person, for any period,
without duplication, (i) all cash interest on Indebtedness (other than Junior
Subordinated Indebtedness) of such Person (including, in the case of the
Borrower, all interest on Permitted Holdco Replacement Debt to the extent such
interest is paid from the proceeds of a Restricted Payment made from the
Borrower to Holdco), and commitment fees in respect of such Indebtedness,
accrued during such period plus (ii) the net amount payable accrued by such
Person pursuant to any Interest Rate Protection Agreement during such period
(or minus the net amount receivable accrued by such Person thereunder during
such period).
"Interest Payment Date" means the last day of January, April,
July and October of each year.
"Interest Period" means a period commencing, in the case of
the first Interest Period applicable to a Eurodollar Rate Loan, on the day of
the making of, or conversion into, such Loan, and, in the case of each
subsequent, successive Interest Period applicable thereto, on the last day of
the next preceding Interest Period, and ending, depending on the Type of Loan,
on the same day in the first, second, third or sixth (or, if made available by
each of the Banks, ninth or twelfth) calendar month thereafter, as elected by
the Borrower in the applicable notice of borrowing under Section 1.02 or notice
of conversion or continuation under Section 1.04(c), except that (i) any
Interest Period that would otherwise end on a day that is not a Eurodollar
Business Day shall be extended to the next succeeding Eurodollar Business Day,
unless such Eurodollar Business Day falls in another calendar month, in which
case such Interest Period shall
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end on the next preceding Eurodollar Business Day and (ii) any Interest Period
that begins on the last Eurodollar Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the calendar month
in which such Interest Period ends) shall end on the last Eurodollar Business
Day of a calendar month.
"Interest Rate Protection Agreements" means, for any Person,
an interest rate swap, cap or collar agreement or similar arrangement between
such Person and a Bank or other financial institution having combined capital
and surplus of at least $200,000,000 or that has (or that is a subsidiary of a
bank holding company that has) publicly traded unsecured long-term debt
securities given a rating of A- (or the equivalent rating then in effect) or
better by Standard & Poor's Ratings Group or a rating of A3 (or the equivalent
rating then in effect) or better by Moody's Investors Service, Inc. in either
case at the time that such interest rate swap, cap or collar agreement or
similar arrangement is established, providing for the transfer or mitigation of
interest risks either generally or under specific contingencies.
"Issuing Bank" means The Bank of New York, or such other Bank
as the Borrower and such Bank shall agree, in each case in its capacity as the
issuer of each Letter of Credit.
"Joint Bidding Agreement" means the letter agreement dated
August 4, 1994 among Comcast, Liberty and TCI.
"Joint Ownership and Management Agreements" means all
shareholders', management or similar agreements between Comcast or any of its
Affiliates and Liberty or any of its Affiliates with respect to the Borrower,
including but not limited to the Shareholders' Agreement.
"Junior Subordinated Indebtedness" means Affiliate
Subordinated Indebtedness (other than accrued Management Fees) advanced to the
Borrower or Holdco (to the extent, in the case of Holdco, that the proceeds of
such Indebtedness shall have been advanced to the Borrower as Junior
Subordinated Indebtedness or capital contributions) by Comcast, Liberty or an
Affiliate of Comcast or Liberty that shall have become a party to the Affiliate
Subordination Agreement (or, in the case of Affiliate Subordinated Indebtedness
advanced to the Borrower, by Holdco).
"LC Commitment" means at any time $75,000,000 minus the pro
rata share thereof (computed on the basis of the Working Capital Commitments at
such time) of each Nonparticipating Bank.
"Lending Office" means, with respect to any Bank, the Domestic
Lending Office or the Eurodollar Lending Office of such Bank.
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"Letter of Credit" means a letter of credit issued by the
Issuing Bank pursuant to Section 1.03.
"Letter of Credit Participation" means, in the case of any
Bank (other than the Issuing Bank) with respect to any Letter of Credit, the
participation interest of such Bank in such Letter of Credit acquired pursuant
to Section 1.03(e) and, in the case of the Issuing Bank, its retained interest
in such Letter of Credit. The amount of the Letter of Credit Participation of
a Bank (including the Issuing Bank) in any Letter of Credit at any time shall
be deemed to be the amount equal to such Bank's pro rata share (determined on
the basis of the Working Capital Commitments at such time of each of the Banks)
of the sum of (a) the aggregate unpaid amount of all Drawings thereunder at
such time and (b) the amount of the Contingent Reimbursement Obligation with
respect thereto at such time that shall not have been prepaid or cash
collateralized at such time.
"Leverage Ratio" means, as of any date of determination, the
ratio of (i) Consolidated Indebtedness on such date to (ii) Cash Flow as of
such date.
"Liability" means, with respect to any Person, any
indebtedness, liability or obligation of or binding upon such Person or any of
its assets.
"Liberty" means Liberty Media Corporation, a Delaware
corporation.
"Lien" means, with respect to any property or asset (or any
income or profits therefrom) of any Person (in each case whether the same is
consensual or nonconsensual or arises by Contract, operation of law, legal
process or otherwise), (i) any mortgage, lien, pledge, attachment, levy or
other security interest of any kind thereupon or in respect thereof or (ii) any
other arrangement under which the same is transferred, sequestered or otherwise
identified with the intention of subjecting the same to, or making the same
available for, the payment or performance of any Liability in priority to the
payment of the ordinary, unsecured creditors of such Person. For the purposes
of this Agreement, a Person shall be deemed to own subject to a Lien any asset
that it has acquired or holds subject to the interest of a vendor or lessor
under any conditional sale agreement, capital lease or other title retention
agreement relating to such asset.
"Loan" means any Term A Loan, any Term B Loan, any RC Loan,
any Working Capital Loan or any Swing Loan.
"Loan Document Related Claim" means any claim (whether civil,
criminal or administrative and whether sounding in tort, contract or otherwise)
arising out of, related to, or connected with, the Loan Documents, whether such
claim arises or is
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asserted before or after the Agreement Date or before or after the Repayment
Date.
"Loan Document Representation and Warranty" means any
"Representation and Warranty" as defined in any Loan Document and any other
representation or warranty made or deemed made pursuant to the terms of any
Loan Document.
"Loan Documents" means (i) this Agreement, the Notes, the
Pledge Agreements, the Guaranty Agreements and the Affiliate Subordination
Agreement and (ii) all other agreements, documents and instruments arising out
of (A) any agreement, document or instrument referred to in clause (i) above,
(B) any other agreement, document or instrument referred to in this clause (ii)
or (C) any of the transactions pursuant to any agreement, document or
instrument referred to in clause (i) above or in this clause (ii).
"Loan Parties" means the Borrower, each Subsidiary party to a
Guaranty Agreement and each Pledgor.
"Management Fees" means all fees and other amounts payable to
Comcast or Liberty or any of their respective Affiliates (other than the
Borrower and the Subsidiaries) for the supervision and management of the
Borrower and the Subsidiaries (other than amounts paid in reimbursement of
out-of-pocket costs and expenses incurred on behalf of the Borrower or the
Subsidiaries).
"Managing Agents" means The Bank of New York Company, Inc.,
Barclays Bank PLC, Chemical Bank, NationsBank, N.A. (Carolinas) and The
Toronto-Dominion Bank, as Managing Agents for the Banks under the Loan
Documents.
"Mandatorily Redeemable Securities" means, with respect to any
Person, any Capital Securities of such Person to the extent that they are (i)
redeemable, payable or required to be purchased or otherwise retired or
extinguished, or convertible into any Indebtedness or other Liability of such
Person, at any time prior to the first anniversary of the Term B Maturity Date,
(A) at a fixed or determinable date, whether by operation of a sinking fund or
otherwise, (B) at the option of any Person other than such Person or (C) upon
the occurrence of a condition not solely within the control of such Person,
such as a redemption required to be made out of future earnings or (ii)
convertible into Mandatorily Redeemable Securities at the option of any Person
other than such Person.
"Material Loan Documents" means this Agreement, the Notes, the
Pledge Agreements, the Guaranty Agreements and the Affiliate Subordination
Agreement.
"Materially Adverse Effect" means, (i) with respect to any
Person, any materially adverse effect on such Person's
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business, assets, Liabilities, financial condition or results of operations,
(ii) with respect to a group of Persons "taken as a whole," any materially
adverse effect on such Persons' business, assets, Liabilities, financial
condition or results of operations taken as a whole on, where appropriate, a
consolidated basis in accordance with Generally Accepted Accounting Principles,
(iii) with respect to any Loan Document, any material adverse effect on the
binding nature, validity or enforceability thereof as an obligation of any Loan
Party that is a party thereto and (iv) with respect to any Collateral, or any
category of Collateral, pledged by any Loan Party, a materially adverse effect
on the validity, perfection, priority or enforceability of the Security Interest
therein.
"Material Subsidiary" means, as of any date of determination,
any Subsidiary (a) listed on Schedule 4.22, (b) whose (i) operating revenue for
the four consecutive fiscal quarters of such Subsidiary ending on, or most
recently ended prior to, such date or (ii) Subsidiary Cash Flow as of such date
exceeds 5% of the operating revenue of the Borrower and the Consolidated
Subsidiaries for such period or the Cash Flow as of such date, respectively, or
(c) whose assets as of such date constitute greater than 5% of the consolidated
assets of the Borrower and the Consolidated Subsidiaries as of such date.
"Maximum Permissible Rate" means, with respect to interest
payable on any amount, the rate of interest on such amount that, if exceeded,
could, under Applicable Law, result in (i) civil or criminal penalties being
imposed on the payee or (ii) the payee's being unable to enforce payment of (or,
if collected, to retain) all or any part of such amount or the interest payable
thereon.
"Merger" means the merger of Acquisition Corp. with and
into QVC pursuant to the Merger Agreement.
"Merger Agreement" means the Agreement and Plan of Merger
dated as of August 4, 1994 among Comcast, Liberty, Acquisition Corp. and QVC, as
amended by the First Amendment, dated as of February 3, 1995.
"Merger Date" means the date on which the Merger shall have
been consummated and become effective, which date shall be a Business Day
occurring no later than April 30, 1995.
"Multiemployer Benefit Plan" means any Benefit Plan that is a
multiemployer plan as defined in Section 4001(a)(3) of ERISA.
"Net Proceeds" means, with respect to any sale or disposition
of assets, the gross amount of consideration (other than consideration in the
form of Indebtedness and other Liabilities assumed directly or indirectly by the
purchaser of such assets) or other amounts, excluding condemnation awards and
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insurance settlements, paid to or received by the Borrower or any Subsidiary in
respect of such sale or disposition, less the sum of (a) reasonable and
customary fees, costs and expenses incurred in connection with such sale or
disposition and payable by or on behalf of the seller or the transferor of the
assets to which such sale or disposition relates, (b) the amount, reasonably
estimated by the Borrower, of taxes payable to federal, state and local taxing
authorities by such seller or transferor in connection with such sale or
disposition and (c) the amount of Indebtedness and other Liabilities
attributable to or associated with such assets (other than any such Indebtedness
or Liability owed to the Borrower or any Subsidiary) required to be paid or
repaid or, in the case of any such Liability, retained on a primary obligor
basis by the Borrower or any Subsidiary in connection with such sale or
disposition. For purposes hereof, the value of any noncash consideration
received from purchasers of assets shall be the fair market value thereof, as
determined in good faith by the Borrower.
"Nonparticipating Bank" means a Working Capital Bank
designated by the Issuing Bank as a Bank with respect to which a Bank
Nonparticipation has occurred. The designation of a Working Capital Bank by the
Issuing Bank as a "Nonparticipating Bank" shall not affect the status of such
Bank as a Participating Bank in respect of Letters of Credit issued prior to
such designation.
"Note" means any Term A Note, Term B Note, RC Note,
Working Capital Note or Swing Note.
"Notice of Assignment" means any notice to the Borrower and
the Administrative Agent with respect to an assignment pursuant to Section
9.10(a) in the form of Schedule 9.10(a).
"Offer to Purchase" means Acquisition Corp.'s Offer to
Purchase all outstanding shares of the common stock and certain preferred stock
of QVC dated August 11, 1994.
"Participating Bank" means a Working Capital Bank that is not
a Nonparticipating Bank. A Participating Bank shall remain a Participating Bank
in all Letters of Credit with respect to which it was a Participating Bank prior
to its designation as a Nonparticipating Bank.
"Participating Bank Percentage" means, for a Participating
Bank, with respect to any Letter of Credit, the fraction, expressed as a
percentage, the numerator of which is such Participating Bank's Working Capital
Commitment and the denominator of which is the sum of the Working Capital
Commitments of all Banks that are, at the time of issuance of such Letter of
Credit, Participating Banks.
"PBGC" means the Pension Benefit Guaranty Corporation.
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"Permitted Borrower Replacement Debt" means Indebtedness of
the Borrower, the proceeds of which are used to prepay the Term B Loan pursuant
to Section 1.06(b)(iii) hereof and the terms and conditions of which are
reasonably satisfactory to no fewer than four of the Managing Agents.
"Permitted Guaranty" means (i) Guaranties to which Section
4.09 is by its express terms inapplicable by virtue of clause (e) or (g) thereof
and (ii) Guaranties of obligations of the Borrower or any Subsidiary.
"Permitted Holdco Replacement Debt" means Indebtedness of
Holdco (i) the terms and conditions of which (A) either (x) do not require any
cash debt service (whether of principal or interest) at any time prior to the
Term A Maturity Date or (y) if such terms and conditions do require any cash
debt service prior to the Term A Maturity Date, the aggregate principal amount
of such Indebtedness shall not exceed $200,000,000 and the terms and conditions
of such required cash debt service shall be reasonably satisfactory to no fewer
than four of the Managing Agents and (B) are otherwise reasonably satisfactory
to no fewer than four of the Managing Agents and (ii) the net proceeds of which,
up to the amount of the outstanding Term B Loans, are used to prepay the Term B
Loans pursuant to Section 1.06(b)(iii).
"Permitted Lien" means (i) the Security Interest; (ii) any
Lien securing the Permitted Mortgage Indebtedness and the obligations of the
obligor in respect of Indebtedness to which Section 4.09 is by its express terms
inapplicable by virtue of clause (e) thereof; (iii) any right of set-off arising
under law and not under Contract, any Lien securing a tax, assessment or other
governmental charge or levy or the claim of a materialman, mechanic, carrier,
warehouseman or landlord for labor, materials, supplies or rentals incurred in
the ordinary course of business, but only if payment thereof shall not at the
time be required to be made in accordance with Section 4.01(e) and foreclosure,
distraint, sale or other similar proceedings shall not have been commenced and
remained unstayed or undismissed for more than 30 days; (iv) any Lien on the
properties and assets of a Subsidiary securing an obligation owing to the
Borrower or a Wholly Owned Subsidiary; (v) any Lien consisting of a deposit or
pledge made in the ordinary course of business in connection with, or to secure
payment of, obligations under workers' compensation, unemployment insurance,
state sales or use taxes, or similar legislation, or in connection with
sweepstakes obligations undertaken in the ordinary course of business; (vi) any
Lien (other than a Lien on the Collateral) arising pursuant to an order of
attachment, distraint or similar legal process arising in connection with legal
proceedings, but only if and so long as, in the case of any such Lien arising in
connection with a judgment, no Event of Default set forth in Section 6.01(g)
shall exist and, in each other case, the execution or other enforcement thereof
is not unstayed for more than 20 days; (vii) any Lien existing on (A) any
property or
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asset of any Person at the time such Person becomes a Subsidiary or (B) any
property or asset at the time such property or asset is acquired by the Borrower
or a Subsidiary, but only, in the case of either (A) or (B), if and so long as
(w) such Lien was not created in contemplation of such Person becoming a
Subsidiary or such property or asset being acquired, (x) such Lien is and will
remain confined to the property or asset subject to it at the time such Person
becomes a Subsidiary or such property or asset is acquired and to fixed
improvements thereafter erected on such property or asset and (y) such Lien
secures only the obligation secured thereby at the time such Person becomes a
Subsidiary or such property or asset is acquired; (viii) any Lien in existence
on the Agreement Date to the extent, in the case of any Lien securing an amount
in excess of $250,000, set forth on Schedule 4.05, but only, in the case of each
such Lien, to the extent it secures an obligation outstanding on the Agreement
Date to the extent set forth on such Schedule; (ix) any Lien securing any
Indebtedness permitted pursuant to Section 4.09(f) or (g); (x) any Lien arising
with respect to certain of the Pledged Securities pursuant to the "Excluded
Repurchase Rights", as such term is defined in the Stockholders Agreement; or
(xi) any Lien constituting a renewal, extension or replacement of a Lien
constituting a Permitted Lien by virtue of clause (vii), (viii) or (ix) above,
but only if (A) at the time such Lien is granted and after giving effect
thereto, no Default would exist, (B) such Lien is limited to all or a part of
the property or asset that was subject to the Lien so renewed, extended or
replaced and to fixed improvements thereafter erected on such property or asset,
(C) the principal amount of the obligations secured by such Lien does not exceed
the principal amount of the obligations secured by the Lien so renewed, extended
or replaced and (D) the obligations secured by such Lien bear interest at a rate
per annum not exceeding the rate borne by the obligations secured by the Lien so
renewed, extended or replaced except for any increase that is commercially
reasonable at the time of such increase.
"Permitted Management Fees" has the meaning ascribed to
such term in Section 4.11(b).
"Permitted Mortgage Indebtedness" means Indebtedness secured
by one or more mortgages on real property owned or leased by the Borrower or any
of its Subsidiaries in an aggregate outstanding principal amount not in excess
of $20,000,000 at any time.
"Permitted Receivables Program" means (a) the GECC Agreement
as in effect on the Agreement Date, as the same may be amended or supplemented
from time to time thereafter, provided that any such amendment or supplement
that is adverse to the Borrower may be made only with the consent of no fewer
than four Managing Agents, and (b) any agreement entered into by the Borrower in
substitution for the GECC Agreement as so amended, so long as such substitute
agreement is, taken as a whole, no less
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favorable to the Borrower than the GECC Agreement as so amended
or supplemented.
"Permitted Restrictive Covenant" means (i) any covenant or
restriction contained in any Loan Document, (ii) any covenant or restriction
binding upon any Person at the time such Person becomes a Subsidiary of the
Borrower if the same is not created in contemplation thereof, (iii) any covenant
or restriction described in Schedule 4.12, but only to the extent such covenant
or restriction is there identified by specific reference to the provision of the
Contract in which such covenant or restriction is contained, (iv) any covenant
or restriction that (A) is not more burdensome than an existing Permitted
Restrictive Covenant that is such by virtue of clause (ii), (iii) or (iv) above,
(B) is contained in a Contract constituting a renewal, extension or replacement
of the Contract in which such existing Permitted Restrictive Covenant is
contained and (C) is binding only on the Person or Persons bound by such
existing Permitted Restrictive Covenant or (v) any covenant or restriction
contained in any Permitted Mortgage Indebtedness or any document relating to any
Permitted Receivables Program that is customarily contained in documentation for
mortgage indebtedness and receivables programs for borrowers thereunder or
sellers of receivables thereunder that are similarly situated to such of the
Borrower and the Subsidiaries as is party to such Permitted Mortgage
Indebtedness or Permitted Receivables Program.
"Person" means any individual, sole proprietorship,
corporation, partnership, trust, unincorporated organization, mutual company,
joint stock company, estate, union, employee organization, government or any
agency or political subdivision thereof or, for the purpose of the definition of
"ERISA Affiliate," any trade or business.
"Pledge Agreements" means each of the Pledge Agreements dated
the date hereof or hereafter entered into between each of the Pledgors and the
Secured Party.
"Pledged Securities" has the meaning ascribed to such term in
the Pledge Agreements.
"Pledgors" means, at any time, the Borrower, all Persons who
own Capital Securities of the Borrower at such time, and each of the Borrower
and any Subsidiary who owns Capital Securities of a Material Subsidiary at such
time.
"Post-Default Rate" means the rate otherwise applicable under
Section 1.04(a) plus 2% or, if there is no such rate, the Base Rate plus the
Applicable Margin plus 2%.
"Predecessor Indebtedness" means the Tender Offer Loans and
the Indebtedness under the $60,000,000 Credit Agreement, dated as of March 5,
1993 between QVC Network, Inc. and The Bank
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of New York, together with all other amounts payable by QVC or Acquisition Corp.
in connection therewith.
"Prime Rate" means the prime commercial lending rate of The
Bank of New York, as publicly announced to be in effect from time to time. The
Prime Rate shall be adjusted automatically, without notice, on the effective
date of any change in such prime commercial lending rate. The Prime Rate is not
necessarily the lowest rate of interest of The Bank of New York.
"Pro Forma Debt Service" means, as of any date of
determination, the sum of (i) all scheduled payments of principal on the Loans
and all other Consolidated Indebtedness and scheduled reductions of the Total RC
Commitment pursuant to Section 1.08(a) during the period commencing with the day
next succeeding such date and ending on the date corresponding to such date of
determination in the following calendar year and (ii) Interest Expense for such
period; provided, however, that Interest Expense shall be calculated, for
purposes of this definition, on the basis of (A) in the case of Eurodollar Rate
Loans, the interest rate or rates then in effect with respect to such Eurodollar
Rate Loans, (B) in the case of Base Rate Loans, the average interest rate
applicable to such Loans during the period of 90 days preceding the date of
determination and (C) in the case of all Consolidated Indebtedness (other than
the Loans) bearing interest at a floating rate, the interest rate or rates then
in effect with respect to such Indebtedness.
"Pro Forma Debt Service Ratio" means, as of any date of
determination, the ratio of (i) Cash Flow as of such date to (ii) Pro Forma Debt
Service as of such date.
"Prohibited Transaction" means any transaction that is
prohibited under Section 4975 of the Code or Section 406 of ERISA and not exempt
under Section 4975 of the Code or Section 408 of ERISA.
"Q2/On Q Net Operating Costs" means, for any period, (a) prior
to January 31, 1997, the operating costs (exclusive of depreciation,
amortization and other non-cash charges to income) incurred by the Borrower in
connection with Q2, On Q or any similar channel or service during or with
respect to such period minus (but not less than zero) the operating revenue
earned by the Borrower therefrom during or with respect to such period, and (b)
thereafter, zero.
"QVC" means QVC, Inc., a Delaware corporation.
"RC Bank" means (i) any Bank that has an amount greater than
zero set forth opposite such Bank's name under the heading "RC Commitment" on
Annex A and (ii) any Person that has been assigned any or all of the rights or
obligations of an RC Bank with respect to its RC Commitment or RC Loans pursuant
to Section 9.10(a).
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"RC Commitment" means, with respect to any Bank, (i) the
amount set forth opposite such Bank's name under the heading "RC Commitment" on
Annex A or, in the case of a Bank that becomes a Bank pursuant to an assignment,
the amount of the assignor's RC Commitment assigned to such Bank, in either case
as the same may be reduced from time to time pursuant to Section 1.08 or
increased or reduced from time to time pursuant to assignments in accordance
with Section 9.10(a) or (ii) as the context may require, the obligation of such
Bank to make RC Loans in an aggregate unpaid principal amount not exceeding such
amount.
"RC Loan" means any amount advanced by a Bank pursuant
to Section 1.01(b).
"RC Maturity Date" means January 31, 2003.
"RC Note" means any promissory note in the form of
Exhibit A-3.
"Reference Banks" means The Bank of New York Company, Inc.,
Barclays Bank PLC, Chemical Bank, NationsBank, N.A. (Carolinas) and The
Toronto-Dominion Bank, and any replacement Reference Bank appointed pursuant to
Section 9.18.
"Regulations D, G, T, U and X" means Regulation D, G, T, U and
X, respectively, of the Board of Governors of the Federal Reserve System.
"Regulatory Change" means any Applicable Law, interpretation,
directive, request or guideline (whether or not having the force of law), or any
change therein or in the administration or enforcement thereof, that becomes
effective or is implemented or first required or expected to be complied with
after the Agreement Date (including any Applicable Law that shall have become
such as the result of any act of omission of the Borrower or any of its
Affiliates, without regard to when such Applicable Law shall have been enacted
or implemented), whether the same is (i) the result of an enactment by a
government or any agency or political subdivision thereof, a determination of a
court or regulatory authority or otherwise or (ii) enacted, adopted, issued or
proposed before or after the Agreement Date, including any such that imposes,
increases or modifies any Tax, reserve requirement, insurance charge, special
deposit requirement, assessment or capital adequacy requirement, but excluding
any such that imposes, increases or modifies any Bank Tax.
"Repayment Date" means the later of (i) the termination of the
Commitments in their entirety (whether as a result of the occurrence of the Term
A Maturity Date, Term B Maturity Date, RC Maturity Date and Working Capital
Maturity Date, the reduction thereof to zero pursuant to Section 1.08 or the
termination thereof pursuant to Section 6.02), (ii) the payment in full of all
principal of and interest on the Loans and Drawings and all
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fees payable or accrued hereunder and (iii) the expiration or cancellation of,
or the reduction to zero of the amount available to be drawn under, all
outstanding Letters of Credit.
"Reportable Event" means, with respect to any Benefit Plan of
any Person, (i) the occurrence of any of the events set forth in Section 4043(b)
(other than a Reportable Event as to which the provision of 30 days' notice to
the PBGC is waived under applicable regulations), 4062(e) or 4063(a) of ERISA or
the regulations thereunder with respect to such Benefit Plan, (ii) any event
requiring such Person or any of its ERISA Affiliates to provide security to such
Benefit Plan under Section 401(a)(29) of the Code or (iii) any failure to make a
payment required by Section 412(m) of the Code with respect to such Benefit
Plan.
"Representation and Warranty" means any written representation
or warranty made pursuant to or under (i) Section 2.02, Article 3, Section 5.02
or any other provision of this Agreement or (ii) any amendment to, or waiver of
rights under, this Agreement, WHETHER OR NOT, IN THE CASE OF ANY REPRESENTATION
OR WARRANTY REFERRED TO IN CLAUSE (i) OR (ii) ABOVE (EXCEPT, IN EACH CASE, TO
THE EXTENT OTHERWISE EXPRESSLY PROVIDED), THE INFORMATION THAT IS THE SUBJECT
MATTER THEREOF IS WITHIN THE KNOWLEDGE OF THE BORROWER.
"Required Banks" means, at any time, Banks having at least 51%
of the Loans and Letter of Credit Participations outstanding or, if there are no
Loans or Letter of Credit Participations outstanding, at least 51% of the sum of
the Total Term A Commitment, the Total Term B Commitment, the Total RC
Commitment and the Total Working Capital Commitment.
"Required Term B Banks" means, at any time, Term B Banks
having at least 51% of the Term B Loans outstanding or, if there are no Term B
Loans outstanding, at least 51% of the Total Term B Commitment.
"Responsible Officer" means (i) with respect to QVC or any
Subsidiary of QVC, the Chairman of the Board, the Vice-Chairman of the Board,
the President, any Executive Vice-President, the Treasurer or the Secretary
thereof, (ii) with respect to Liberty or any Subsidiary of Liberty, the Chairman
of the Board, the Vice-Chairman of the Board, the President, any Vice President,
the Chief Financial Officer, the Treasurer or Assistant Treasurer and (iii) with
respect to any other Transaction Party, the Chairman of the Board, the
Vice-Chairman of the Board, the President, any Senior Vice President or the
Chief Financial Officer of such Transaction Party.
"Restricted Payment" means (i) (A) any dividend or other
distribution on account of any Capital Securities of the Borrower or any
Subsidiary (other than (1) dividends payable solely in such Capital Securities
other than Mandatorily Redeemable Securities and (2) dividends and other
distributions
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payable to the Borrower or a Wholly Owned Subsidiary), (B) any payment on
account of the principal of or premium, if any, on any Indebtedness convertible
into Capital Securities of the Borrower or any Subsidiary (other than any such
payment to the Borrower or a Wholly Owned Subsidiary) or (C) any payment on
account of any purchase, redemption, retirement, exchange or conversion of any
Capital Securities of the Borrower or any Subsidiary (other than any such
payment to the Borrower or a Wholly Owned Subsidiary) and (ii) payments of
interest on, or payments or prepayments of principal of, or the setting apart of
money for a sinking or other analogous fund for, the purchase, redemption,
retirement or other acquisition of, any principal of or interest on Junior
Subordinated Indebtedness. For the purposes of this definition, a "payment" or
"prepayment" shall include the transfer of any asset or the issuance of any
Indebtedness or other obligation (the amount of any such payment to be the fair
market value of such asset or the amount of such obligation, respectively) but
shall not include the issuance of any Capital Securities other than Mandatorily
Redeemable Securities.
"Secured Party" has the meaning ascribed to such term in the
Pledge Agreements.
"Security Interest" means the Liens created, or purported to
be created, by the Loan Documents.
"Shareholders' Agreement" means (i) at all times prior to the
effectiveness of the Stockholders Agreement, the Joint Bidding Agreement and
(ii) at all times thereafter, the Stockholders Agreement.
"Stockholders Agreement" means the Stockholders Agreement,
dated as of February 9, 1995 among Comcast, Comcast QVC, Inc., Acquisition
Corp., Liberty, QVC Investments, Inc. and Liberty QVC, Inc.
"Subsidiary" means, with respect to any Person, any other
Person (i) securities of which having ordinary voting power to elect a majority
of the board of directors (or other persons having similar functions) of such
Person or (ii) other ownership interests of which ordinarily constituting a
majority voting interest are at the time, directly or indirectly, owned or
controlled by such first Person, or by one or more of its Subsidiaries, or by
such first Person and one or more of its Subsidiaries; unless otherwise
specified, "Subsidiary" means a Subsidiary of the Borrower.
"Subsidiary Cash Flow" means, with respect to any Subsidiary,
as of any date of determination, (i) the operating income (which shall be
consolidated, as appropriate and shall include income (net of expenses) derived
from credit card operations) of such Subsidiary, plus (ii) depreciation,
amortization and all other non-cash charges to income and extraordinary items
(to the extent deducted in determining
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<PAGE> 108
operating income), in each case for the four consecutive fiscal quarters of such
Subsidiary ending on, or most recently ended prior to, such date.
"Swing Loan" means an amount advanced by the Swing Loan Lender
pursuant to Section 1.01(d) hereof.
"Swing Loan Percentage" means, for any Working Capital Bank,
at any time, a fraction, expressed as a percentage, the numerator of which is
such Working Capital Bank's Working Capital Commitment and the denominator of
which is the Total Working Capital Commitment.
"Swing Loan Lender" means The Bank of New York.
"Swing Note" means any promissory note in the form of
Exhibit A-5.
"Tax" means any Federal, State or foreign tax, assessment or
other governmental charge or levy (including any withholding tax) upon a Person
or upon its assets, revenues, income or profits.
"TCI" means Tele-Communications, Inc., a Delaware
corporation.
"Tender Offer" means the offer to purchase up to all
outstanding shares of the common stock and certain preferred
stock of QVC made by Acquisition Corp. pursuant to the Offer to
Purchase.
"Tender Offer Documents" means (i) the Offer to Purchase, (ii)
all documents filed by or on behalf of the Borrower or QVC with the Securities
and Exchange Commission in connection with the Tender Offer and (iii) all
amendment, modifications or supplements to any of the foregoing.
"Tender Offer Loans" means the Indebtedness of Acquisition
Corp. to the Managing Agents pursuant to that certain Credit Agreement, dated as
of February 9, 1995, among Acquisition Corp., the banks listed on the signature
pages thereof, the Managing Agents and The Bank of New York, as Administrative
Agent.
"Term A Bank" means (i) any Bank that has an amount greater
than zero set forth opposite such Bank's name under the heading "Term A
Commitment" on Annex A and (ii) any Person that has been assigned any or all of
the rights or obligations of a Term A Bank with respect to its Term A Commitment
or Term A Loans pursuant to Section 9.10(a).
"Term A Commitment" means, with respect to any Term A Bank,
(a) at any time prior to the making of the Term A Loans on the Merger Date, (i)
the amount set forth opposite such Bank's
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<PAGE> 109
name under the heading "Term A Commitment" on Annex A or, in the case of a Bank
that becomes a Bank pursuant to an assignment, the amount of the assignor's Term
A Commitment assigned to such Bank, in either case as the same may be increased
or reduced from time to time pursuant to assignments in accordance with Section
9.10(a) or (ii) as the context may require, the obligation of such Bank to make
Term A Loans in an aggregate unpaid principal amount not exceeding such amount,
and (b) thereafter, zero.
"Term A Loan" means any amount advanced by a Term A Bank
pursuant to Section 1.01(a)(i).
"Term A Maturity Date" means January 31, 2003.
"Term A Note" means any promissory note in the form of
Exhibit A-1.
"Term B Bank" means (i) any Bank that has an amount greater
than zero set forth opposite such Bank's name under the heading "Term B
Commitment" on Annex A and (ii) any Person that has been assigned any or all of
the rights or obligations of a Term B Bank with respect to its Term B Commitment
or Term B Loans pursuant to Section 9.10(a).
"Term B Commitment" means, with respect to any Term B Bank,
(a) at any time prior to the making of the Term B Loans on the Merger Date, (i)
the amount set forth opposite such Bank's name under the heading "Term B
Commitment" on Annex A or, in the case of a Bank that becomes a Bank pursuant to
an assignment, the amount of the assignor's Term B Commitment assigned to such
Bank, in either case as the same may be increased or reduced from time to time
pursuant to assignments in accordance with Section 9.10(a) or (ii) as the
context may require, the obligation of such Bank to make Term B Loans in an
aggregate unpaid principal amount not exceeding such amount and (b) thereafter,
zero.
"Term B Loan" means any amount advanced by a Term B Bank
pursuant to Section 1.01(a)(ii).
"Term B Maturity Date" means January 31, 2004.
"Term B Note" means any promissory note in the form of
Exhibit A-2.
"Termination Event" means, with respect to any Benefit Plan,
(i) any Reportable Event with respect to such Benefit Plan, (ii) the termination
of such Benefit Plan, or the filing of a notice of intent to terminate such
Benefit Plan, or the treatment of any amendment to such Benefit Plan as a
termination under Section 4041(c) of ERISA, (iii) the institution of proceedings
to terminate such Benefit Plan under Section 4042 of ERISA or (iv) the
appointment of a trustee to administer such Benefit Plan under Section 4042 of
ERISA.
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<PAGE> 110
"Term Loan" means any Term A Loan or any Term B Loan.
"Total RC Commitment" means the aggregate amount of the RC
Commitments as the same may be reduced from time to time pursuant to Section
1.08.
"Total Revenue" has the meaning ascribed to such term
in Section 4.11(b).
"Total Term A Commitment" means the aggregate amount of the
Term A Commitments.
"Total Term B Commitment" means the aggregate amount of the
Term B Commitments.
"Total Working Capital Commitment" means the aggregate amount
of the Working Capital Commitments as the same may be reduced from time to time
pursuant to Section 1.08.
"Transaction Parties" means the Loan Parties, Comcast, Liberty
and each Affiliate of Comcast or Liberty that shall have become a party to the
Affiliate Subordination Agreement.
"Type" means, with respect to Loans, any of the following,
each of which shall be deemed to be a different "Type" of Loan: Base Rate Loans,
Eurodollar Rate Loans having a one-month Interest Period, Eurodollar Rate Loans
having a two-month Interest Period, Eurodollar Rate Loans having a three-month
Interest Period, Eurodollar Rate Loans having a six-month Interest Period, and,
if made available by each of the Banks, Eurodollar Rate Loans having a
nine-month Interest Period and Eurodollar Rate Loans having a twelve-month
Interest Period. Any Eurodollar Rate Loan having an Interest Period with a
duration that differs from the duration specified for a Type of Eurodollar Rate
Loan listed above solely as a result of the operation of clauses (i) and (ii) of
the definition of "Interest Period" shall be deemed to be a Loan of such Type
notwithstanding such difference in duration of Interest Periods.
"United States person" has the meaning ascribed to such
term in Section 1.13(a).
"Wholly Owned Subsidiary" means, with respect to any Person,
any Subsidiary of such Person all of the Capital Securities and all other
ownership interests and rights to acquire ownership interests of which (except
directors' qualifying shares) are, directly or indirectly, owned or controlled
by such Person or one or more Wholly Owned Subsidiaries of such Person or by
such Person and one or more of such Subsidiaries; unless otherwise specified,
"Wholly Owned Subsidiary" means a Wholly Owned Subsidiary of the Borrower.
"Working Capital Bank" means (i) any Bank that has an amount
greater than zero set forth opposite such Bank's name
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<PAGE> 111
under the heading "Working Capital Commitment" on Annex A and (ii) any Person
that has been assigned any or all of the rights or obligations of a Working
Capital Bank in respect of its Working Capital Commitment, Working Capital Loans
or Letter of Credit Participations pursuant to Section 9.10(a).
"Working Capital Commitment" means, with respect to any Bank,
(i) the amount set forth opposite such Bank's name under the heading "Working
Capital Commitment" on Annex A or, in the case of a Bank that becomes a Bank
pursuant to an assignment, the amount of the assignor's Working Capital
Commitment assigned to such Bank, in either case as the same may be reduced from
time to time pursuant to Section 1.08 or increased or reduced from time to time
pursuant to assignments in accordance with Section 9.10(a) or (ii) as the
context may require, the obligation of such Bank to make Working Capital Loans
or Letter of Credit Participations in an aggregate unpaid principal amount not
exceeding such amount.
"Working Capital Loan" means any amount advanced by a Bank
pursuant to Section 1.01(c).
"Working Capital Maturity Date" means January 31, 2003.
"Working Capital Note" means any promissory note in the
form of Exhibit A-4.
(b) Other Definitional Provisions. (i) Except as otherwise
specified herein, all references herein (A) to any Person shall be deemed to
include such Person's successors and assigns, (B) to any Applicable Law defined
or referred to herein shall be deemed references to such Applicable Law or any
successor Applicable Law as the same may have been or may be amended or
supplemented from time to time and (C) to any Loan Document or Contract defined
or referred to herein shall be deemed references to such Loan Document or
Contract (and, in the case of any Note or any other instrument, any instrument
issued in substitution therefor) as the terms thereof may have been or may be
amended, supplemented, waived or otherwise modified from time to time.
(ii) When used in this Agreement, the words "herein,"
"hereof" and "hereunder" and words of similar import shall refer to this
Agreement as a whole and not to any provision of this Agreement, and the words
"Article," "Section," "Annex," "Schedule" and "Exhibit" shall refer to Articles
and Sections of, and Annexes, Schedules and Exhibits to, this Agreement unless
otherwise specified.
(iii) Whenever the context so requires, the singular
number includes the plural and vice versa.
(iv) Any item or list of items set forth following the
word "including," "include" or "includes" is set forth only
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<PAGE> 112
for the purpose of indicating that, regardless of whatever other items are in
the category in which such item or items are "included," such item or items are
in such category, and shall not be construed as indicating that the items in the
category in which such item or items are "included" are limited to such items or
to items similar to such items.
(v) Each authorization in favor of the Administrative
Agent, the Issuing Bank, the Swing Loan Lender, the Banks, the Borrower or any
other Person granted by or pursuant to this Agreement shall be deemed to be
irrevocable and coupled with an interest.
(vi) Except as otherwise specified herein, all references
herein to the Administrative Agent, the Issuing Bank, the Swing Loan Lender, any
Bank or any Loan Party shall be deemed to refer to such Person, acting in such
capacity, however designated in the Loan Documents, so that (A) a reference to
rights or duties of the Administrative Agent under the Loan Documents shall be
deemed to include the rights or duties of such Person as the Secured Party under
any Pledge Agreement, as the Guaranteed Party under any Guaranty Agreement and
as a party under the Affiliate Subordination Agreement, (B) a reference to costs
incurred by a Bank in connection with the Loan Documents shall be deemed to
include costs incurred by such Person as a beneficiary of the Security Interest
under any Pledge Agreement and as a beneficiary of the terms of the Affiliate
Subordination Agreement and the Guaranty Agreements, (C) a reference to the
obligations of the Loan Parties (other than the Borrower) under the Loan
Documents shall be deemed to include the obligations of such Persons as parties
under the Pledge Agreements and the Guaranty Agreements.
(vii) Except as otherwise specified therein, all terms
defined in this Agreement shall have the meanings herein ascribed to them when
used in the Notes or any certificate, opinion or other document delivered
pursuant hereto or thereto.
Section 10.02. Accounting Matters. Unless otherwise specified
herein, all accounting determinations hereunder and all computations utilized by
the Borrower in complying with the covenants contained herein shall be made, all
accounting terms used herein shall be interpreted, and all financial statements
required to be delivered hereunder shall be prepared, in accordance with
Generally Accepted Accounting Principles, except for departures from Generally
Accepted Accounting Principles as to which (a) the Borrower shall have delivered
to the Administrative Agent, with sufficient copies for each of the Banks, not
later than the first time that such financial statements or computations are
prepared or made on the basis of such departures, a notice setting forth in
reasonable detail the nature and substance of such departures and the
application thereof to such financial statements or computations and (b) the
Required Banks shall not have notified the Borrower within 60
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<PAGE> 113
days of the receipt of the Borrower's notice that such financial statements or
computations may not be prepared or made in accordance with or on the basis of
such departures.
Section 10.03. Representations and Warranties. Except to the
extent that any Representation or Warranty is expressly stated to be made only
at or as of a specified time or times, all Representations and Warranties shall
be deemed made (a) in the case of any Representation and Warranty contained in
this Agreement at the time of its initial execution and delivery, at and as of
the Agreement Date, (b) in the case of any Representation and Warranty contained
in this Agreement or any other document at the time any Loan is made, at and as
of such time and (c) in the case of any particular Representation and Warranty,
wherever contained, at such other time or times as such Representation and
Warranty is made or deemed made in accordance with the provisions of this
Agreement or the document pursuant to, under or in connection with which such
Representation and Warranty is made or deemed made.
Section 10.04. Captions. Captions to Articles, Sections and
subsections of, and Annexes, Schedules and Exhibits to, this Agreement are
included for convenience of reference only and shall not constitute a part of
this Agreement for any other purpose or in any way affect the meaning or
construction of any provision of this Agreement.
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<PAGE> 114
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their duly authorized officers all as of the
Agreement Date.
QVC PROGRAMMING HOLDINGS, INC.
By:
--------------------------------
Name:
Title:
THE BANK OF NEW YORK, as
Administrative Agent and Bank
By:
--------------------------------
Name:
Title:
THE BANK OF NEW YORK COMPANY, INC.,
as Managing Agent and Bank
By:
--------------------------------
Name:
Title:
BARCLAYS BANK PLC,
as Managing Agent and Bank
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
<PAGE> 115
CHEMICAL BANK,
as Managing Agent and Bank
By:
-----------------------------------
Name:
Title:
NATIONSBANK, N.A. (CAROLINAS),
as Managing Agent and Bank
By:
-----------------------------------
Name:
Title:
THE TORONTO-DOMINION BANK,
as Managing Agent and Bank
By:
-----------------------------------
Name:
Title:
Agreement Date: , 1995
------- --
<PAGE> 116
<TABLE>
<CAPTION>
ANNEX A
-------
Working
Banks, Lending Office Term A Term B RC Capital
and Notice Addresses Commitment Commitment Commitment Commitment
- --------------------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
THE BANK OF NEW YORK
COMPANY, INC. $140,000,000 $46,666,,666.68 $ 75,833,333.32 ---
Domestic Lending Office:
One Wall Street
New York, New York 10286
Eurodollar Lending Office:
One Wall Street
New York, New York 10286
Notice Address:
The Bank of New York Company, Inc.
One Wall Street
New York, New York 10286
Telecopier No.: (212) 635-8593 or 8595
Telephone No.: (212) 635-8843
Attention: James W. Whitaker
</TABLE>
<PAGE> 117
<TABLE>
<CAPTION>
Working
Banks, Lending Office Term A Term B RC Capital
and Notice Addresses Commitment Commitment Commitment Commitment
- --------------------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
THE BANK OF NEW YORK --- --- --- $17,500,000
Domestic Lending Office:
One Wall Street
New York, New York 10286
Eurodollar Lending Office:
One Wall Street
New York, New York 10286
Notice Address:
The Bank of New York Company, Inc.
One Wall Street
New York, New York 10286
Telecopier No.: (212) 635-8593 or 8595
Telephone No.: (212) 635-8843
Attention: James W. Whitaker
</TABLE>
-2-
<PAGE> 118
<TABLE>
<CAPTION>
Working
Banks, Lending Office Term A Term B RC Capital
and Notice Addresses Commitment Commitment Commitment Commitment
- --------------------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
BARCLAYS BANK PLC $115,000,000 $ 38,333,333.33 $ 62,291,666.67 $14,375,000
Domestic Lending Office:
75 Wall Street
New York, NY 10265
Eurodollar Lending Office:
Bay Street, Nassau, Bahamas
c/o Barclays Bank PLC
75 Wall Street
New York, NY 10265
Notice Address for Credit Issues:
BZW Division
388 Market Street, Suite 1700
San Francisco, CA 94111-5317
Telecopier No.: (415) 765-4703
Telephone No.: (415) 765-4760
Attention: Michael Ballard
Notice Address for Borrowing and Other Issues:
222 Broadway, 12th Floor
New York, NY 10038
Telecopier No.: (212) 412-5002/4090
Telephone No.: (212) 412-4014
Attention: Sandra Coye
</TABLE>
-3-
<PAGE> 119
<TABLE>
<CAPTION>
Working
Banks, Lending Office Term A Term B RC Capital
and Notice Addresses Commitment Commitment Commitment Commitment
- --------------------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
CHEMICAL BANK $115,000,000 $ 38,333,333.33 $ 62,291,666.67 $14,375,000
Domestic Lending Office:
270 Park Avenue
New York, NY 10017
Eurodollar Lending Office:
270 Park Avenue
New York, NY 10017
Notice Address:
270 Park Avenue
New York, NY 10017
Telecopier No.: (212) 270-3942
Telephone No.: (212) 270-2511
Attention: Ganesh Persaud
</TABLE>
-4-
<PAGE> 120
<TABLE>
<CAPTION>
Working
Banks, Lending Office Term A Term B RC Capital
and Notice Addresses Commitment Commitment Commitment Commitment
- --------------------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
NATIONSBANK, N.A. (CAROLINAS) $115,000,000 $ 38,333,333.33 $ 62,291,666.67 $14,375,000
Domestic Lending Office:
1 Independence Center
Charlotte, NC 28255
Eurodollar Lending Office:
1 Independence Center
Charlotte, NC 28255
Notice Address:
1 Independence Center
Charlotte, NC 28255
Telecopier No.: (704) 386-8694
Telephone No.: (704) 388-1111
Attention: Jacquetta Talford
</TABLE>
-5-
<PAGE> 121
<TABLE>
<CAPTION>
Working
Banks, Lending Office Term A Term B RC Capital
and Notice Addresses Commitment Commitment Commitment Commitment
- --------------------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
THE TORONTO-DOMINION BANK $115,000,000 $ 38,333,333.33 $ 62,291,666.67 $14,375,000
Domestic Lending Office:
31 West 52nd Street
New York, NY 10019-6101
Eurodollar Lending Office:
31 West 52nd Street
New York, NY 10019-6101
Notice Address:
31 West 52nd Street
New York, NY 10019-6101
Telecopier No.: (212) 262-1928/1923
Telephone No.: (212) 468-0713
Attention: Michael Bandzierz
</TABLE>
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<PAGE> 122
Schedule 1.02
FORM OF NOTICE OF BORROWING
OR ISSUANCE OF LETTER OF CREDIT
[Name and address of Administrative Agent [and Issuing Bank, in the case of a
request for issuance of a Letter of Credit] in accordance with Section
9.01(b)(ii)]
Date:
Ladies and Gentlemen:
Reference is made to the Credit Agreement, dated as of
_________ __, 1995, among QVC Programming Holdings, Inc., the banks listed on
the signature pages thereof, The Bank of New York Company, Inc., Barclays Bank
PLC, Chemical Bank, NationsBank, N.A. (Carolinas) and The Toronto-Dominion Bank,
as Managing Agents, and The Bank of New York, as Administrative Agent (the
"Credit Agreement"). Terms defined in the Credit Agreement that are not
otherwise defined herein are used herein with the meanings therein ascribed to
them. The undersigned hereby gives notice pursuant to Section 1.02 [1.03(d) in
the case of Letters of Credit] of the Credit Agreement of its request to have
the following [Term A] [Term B] [RC] [Working Capital] Loans made to it [Letters
of Credit issued] on [insert requested date of borrowing or issuance]:
Type of Loan1 Amount
------------- ------
--------------------------------- --------------
--------------------------------- --------------
--------------------------------- --------------
[Description of Letter of Credit, setting forth amount,
beneficiary and other pertinent information.]
[Please disburse the proceeds of the Loans by [insert
requested method of disbursement]].2
The undersigned represents and warrants that (a) the borrowing
[issuance] requested hereby complies with the requirements of Section 1.02
[1.03] of the Credit Agreement and
<PAGE> 123
(b) [except to the extent set forth on Annex A hereto,]3 (i) each Loan Document
Representation and Warranty is true and correct in all material respects at and
as of the date hereof and (except to the extent the undersigned gives notice to
the Banks to the contrary prior to 5:00 p.m. (New York time) on the Business Day
before the requested date for the making of the Loans [issuance of the Letter of
Credit]) will be true and correct at and as of the time the Loans are made
[Letter of Credit is issued], in each case both with and without giving effect
to the Loans [Letter of Credit] and the application of the proceeds thereof, and
(ii) no Default (other than a Default that has been waived by the Required
Banks), including a Default under Section 4.15, 4.16, 4.17 or 4.18, has occurred
and is continuing as of the date hereof and (except to the extent the
undersigned gives notice to the Banks to the contrary prior to 5:00 p.m. (New
York time) on the Business Day before the requested date for the making of the
Loans [issuance of the Letter of Credit]) no Default will have occurred and be
continuing at the time the Loans are to be made [Letter of Credit is to be
issued] or would result from the making of the Loans [issuance of the Letter of
Credit] or from the application of the proceeds thereof.
QVC PROGRAMMING HOLDINGS, INC.
By:
------------------------------------
Name:
Title:
___________________
1. Specify the duration of the Interest Period in the case of
Eurodollar Rate Loans (e.g., one-month Eurodollar Rate).
2. Include and complete this sentence if the proceeds of the requested
Loans are to be disbursed in a manner other than by credit to an
account of the Borrower at the Administrative Agent's Office.
3. If the representation and warranty in either clause (b)(i) or (b)(ii)
would be incorrect, include the material in brackets and set forth the
reasons such representation and warranty would be incorrect on an
attachment labeled Annex A.
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<PAGE> 124
Schedule 1.04(c)(iv)
FORM OF NOTICE OF CONVERSION OR CONTINUATION
[Name and address of Administrative Agent in accordance with Section
9.01(b)(ii)]
Date:
Ladies and Gentlemen:
Reference is made to the Credit Agreement, dated as of
___________, 1995, among QVC Programming Holdings, Inc., the banks listed on the
signature pages thereof, The Bank of New York Company, Inc., Barclays Bank PLC,
Chemical Bank, NationsBank, N.A. (Carolinas) and The Toronto-Dominion Bank, as
Managing Agents, and The Bank of New York, as Administrative Agent (the "Credit
Agreement"). Terms defined in the Credit Agreement that are not otherwise
defined herein are used herein with the meanings therein ascribed to them. The
undersigned hereby gives notice pursuant to Section 1.04(c)(iv) of the Credit
Agreement of its desire to convert or continue the Loans specified below into or
as Loans of the Types and in the amounts specified below on [insert date of
conversion or continuation]:
<TABLE>
<CAPTION>
Loans to be Converted or
Converted or Continued Continued Loans
---------------------- ---------------
Last Day of Date of
Type Current Conversion or Type
of Loan1 Interest Period Amount Continuation of Loan1 Amount
-------- --------------- ------ ------------- -------- ------
<S> <C> <C> <C> <C> <C>
--------- --------------- -------- ------------ -------- -------
--------- --------------- -------- ------------ -------- -------
--------- --------------- -------- ------------ -------- -------
</TABLE>
QVC, INC.
By:
-------------------------------
Name:
Title:
__________
1. Specify the duration of the Interest Period in the case of
Eurodollar Rate Loans (e.g., one-month Eurodollar Rate).
<PAGE> 125
Schedule 1.06
FORM OF NOTICE OF PREPAYMENT
[Name and address of Administrative Agent in accordance with Section
9.01(b)(ii)]
Date:
Ladies and Gentlemen:
Reference is made to the Credit Agreement, dated as of
________, 1995, among QVC Programming Holdings, Inc., the banks listed on the
signature pages thereof, The Bank of New York Company, Inc., Barclays Bank PLC,
Chemical Bank, NationsBank, N.A. (Carolinas) and The Toronto-Dominion Bank, as
Managing Agents, and The Bank of New York, as Administrative Agent (the "Credit
Agreement"). Terms defined in the Credit Agreement that are not otherwise
defined herein are used herein with the meanings therein ascribed to them. The
undersigned hereby gives notice pursuant to Section 1.06 of the Credit Agreement
that it will prepay the Loans specified below on [insert date of prepayment]:
Last Day of
Current
Type of Loan(1) Interest Period Amount
--------------- --------------- ------
- ------------------------ ------------------- ----------------
- ------------------------ ------------------- ----------------
- ------------------------ ------------------- ----------------
QVC, INC.
By:
-----------------------------
Name:
Title:
__________
1. Specify the duration of the Interest Period in the case of Eurodollar Rate
Loans (e.g., one-month Eurodollar Rate).
<PAGE> 126
Schedule 2.01(a)
FORM OF CERTIFICATE AS TO RESOLUTIONS, ETC.
[NAME OF TRANSACTION PARTY]
I, ________________, [Secretary/Assistant Secretary/Responsible
Officer] of [NAME OF TRANSACTION PARTY], a __________ corporation (the
"Company"), hereby certify, pursuant to Section 2.01(a) of the Credit Agreement
(the "Credit Agreement"), dated as of ________, 1995, among QVC Programming
Holdings, Inc., the banks listed on the signature pages thereof, The Bank of New
York Company, Inc., Barclays Bank PLC, Chemical Bank, NationsBank, N.A.
(Carolinas) and The Toronto-Dominion Bank, as Managing Agents, and The Bank of
New York, as Administrative Agent, that (capitalized terms used herein but not
otherwise defined herein shall have the meanings given to them in the Credit
Agreement):
1. The below named persons have been duly elected (or
appointed) and have duly qualified as, and on this day are, officers of the
Company holding the respective offices below set opposite their names, and
the signatures below set opposite their names are their genuine signatures:
Name Office Signature
[ ] [ ] ------------------
[ ] [ ] ------------------
[ ] [ ] ------------------
[ ] [ ] ------------------
2. Attached as Annex A is a true and correct copy of
resolutions duly adopted by the Board of Directors of the Company. Such
resolutions have not been amended, modified or revoked and are in full force
and effect on the date hereof.
3. [List the Loan Documents to which the Company is a
party], in each case as executed and delivered on behalf of the Company, are
consistent with the terms thereof approved by the Board of Directors of the
Company, except for such changes as have been approved by the officer or
officers of the Company executing such documents.
4. There has been no amendment to the certificate of
incorporation of the Company since __________.
5. Attached as Annex B is a true and correct copy of the
by-laws of the Company as in effect on ________, 1995 and at all subsequent
times to and including the date hereof.
<PAGE> 127
IN WITNESS WHEREOF, I have signed this certificate this __ day of
_____, 1995.
By:
------------------------------------
Name:
Title:
I, __________, __________ of the Company, hereby certify that
__________ has been duly elected or appointed and has been duly qualified as,
and on this day is, [Secretary/Assistant Secretary/Responsible Officer] of the
Company, and the signature in paragraph 1 above is such individual's genuine
signature.
IN WITNESS WHEREOF, I have signed this certificate this __ day of
___, 1995.
By:
------------------------------------
Name:
Title:
-2-
<PAGE> 128
Schedule 2.01(d)-1
FORM OF OPINION OF COUNSEL
FOR THE BORROWER
<PAGE> 129
Schedule 2.01(d)-2
FORM OF OPINION OF COUNSEL
FOR EACH TRANSACTION PARTY OTHER THAN BORROWER
<PAGE> 130
Schedule 2.01(e)
FORM OF OPINION OF SPECIAL
COUNSEL FOR THE ADMINISTRATIVE AGENT
[Letterhead of Winthrop, Stimson, Putnam & Roberts]
_______ __, 1995
To the Administrative Agent and each Bank party to the Credit Agreement referred
to below
Ladies and Gentlemen:
We have acted as counsel to The Bank of New York, as Administrative
Agent, in connection with the negotiation, execution and delivery of the Credit
Agreement, dated as of ______ __, 1995, among QVC, Inc., the banks listed on the
signature pages thereof, The Bank of New York Company, Inc., Barclays Bank PLC,
Chemical Bank, NationsBank, N.A. (Carolinas) and The Toronto- Dominion Bank, as
Managing Agents, and The Bank of New York, as Administrative Agent (the "Credit
Agreement"). Terms defined in the Credit Agreement that are not otherwise
defined herein are used herein with the meanings therein ascribed to them.
For the purposes of rendering the opinions contained in this
letter, we have examined executed counterparts of the Credit Agreement, the
Notes delivered on the date hereof, the Pledge Agreements, the Guaranty
Agreements and the Affiliate Subordination Agreement (collectively, the "Loan
Documents").
For the purposes of this opinion, we have assumed (i) the
authenticity of all such documents submitted to us as originals, (ii) the due
authorization, execution and delivery by the Administrative Agent and the Banks
of the Loan Documents to which they are parties, (iii) that each of the Loan
Parties has the corporate power, and has taken all necessary corporate action to
authorize it, to execute, deliver and perform each of the Loan Documents to
which it is a party, (iv) that the Loan Documents have been duly executed and
delivered by each of the Loan Parties and (v) that the execution, delivery and
performance in accordance with their respective terms by each of the Loan
Parties of the Loan Documents to which it is a party do not and will not (A)
require any Governmental Approval or any other consent or approval, other than
Governmental Approvals and other consents or approvals that have been obtained,
are final and not subject to review or collateral attack and are in full force
and effect, or (B) violate or conflict with, result in a breach of, or
constitute a default under (1) any Contract to which any of the Loan Parties
<PAGE> 131
is a party or by which it or its properties may be bound or (2) any Applicable
Law referred to in clause (ii)(B) or (C) of the definition thereof contained in
the Credit Agreement.
Based upon the foregoing, and subject to the qualifications and
limitations set forth herein, we are of the opinion that the Loan Documents are
legal, valid and binding obligations of the Loan Parties party thereto,
enforceable against such Loan Parties in accordance with their respective terms.
Our opinion above is subject to the following qualifications and
limitations:
(a) Our opinion is subject to the effect of applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance and other laws affecting the
enforcement of creditors' rights generally and to the effect of general
equitable principles (whether considered in a proceeding in equity or at law).
Such principles applied by a court might include a requirement that a creditor
act with reasonableness and good faith. Furthermore, a court may refuse to
enforce a covenant where a court deems such covenant to be violative of
applicable public policy.
(b) Our opinions are limited to the law of the State of New York
and the Federal law of the United States. Without limiting the generality of the
foregoing, we express no opinion as to the effect of the law of any jurisdiction
other than the State of New York wherein any Bank may be located or wherein
enforcement of the Loan Documents may be sought that limits the rates of
interest legally chargeable or collectable.
(c) Certain remedial provisions of the Pledge Agreements may be
unenforceable in whole or in part, but the inclusion of such provisions does not
affect the validity of the Pledge Agreements, and the Pledge Agreements taken as
a whole contains adequate provisions for enforcing the obligations of the Loan
Parties pursuant thereto and for the practical realization of the benefits
created thereby. In addition, certain remedial provisions of the Pledge
Agreements may be subject to procedural requirements not set forth therein.
(d) Our opinion (to the extent it relates to the Pledge
Agreements) is also subject to the limitation that we express no
opinion with respect to:
(i) the perfection or priority of the Security
Interest;
(ii) each Loan Party's rights in or title to or legal
or beneficial ownership of any of the Collateral; and
(iii) the validity or enforceability of the Security
Interest except to the extent that the creation thereof is governed by Article 8
or 9 of the Uniform Commercial Code as in effect on the date hereof in the State
of New York.
-2-
<PAGE> 132
This opinion is intended for the sole benefit of the Administrative
Agent and the Banks and no other Person shall be entitled to rely hereon for any
purpose.
Very truly yours,
-3-
<PAGE> 133
Schedule 2.01(l)
FORM OF CERTIFICATE AS TO SOLVENCY AND
ADEQUACY OF CAPITAL, ETC.
<PAGE> 134
Schedule 3.02
CAPITALIZATION
Capital Securities of Borrower
SUBSIDIARIES
<PAGE> 135
Schedule 3.03
REQUIRED CONSENTS AND GOVERNMENTAL APPROVALS
<PAGE> 136
Schedule 3.04
MATERIAL LITIGATION
<PAGE> 137
Schedule 3.13
EXISTING BENEFIT PLANS
<PAGE> 138
Schedule 4.04
EXISTING GUARANTIES
<PAGE> 139
Schedule 4.05
EXISTING LIENS
<PAGE> 140
Schedule 4.12
PERMITTED RESTRICTIVE COVENANTS
<PAGE> 141
Schedule 4.14
EXISTING INVESTMENTS
<PAGE> 142
Schedule 4.22
MATERIAL SUBSIDIARIES
<PAGE> 143
Schedule 5.01(a)
FORM OF CERTIFICATE AS TO QUARTERLY FINANCIAL STATEMENTS
QVC, INC.
I, ___________, [Responsible Officer] of QVC, INC., a Delaware
corporation (the "Borrower"), hereby certify, pursuant to Section 5.01(a) of
the Credit Agreement, dated as of ________, 1995, among the Borrower, the banks
listed on the signature pages thereof, The Bank of New York Company, Inc.,
Barclays Bank PLC, Chemical Bank, NationsBank, N.A. (Carolinas) and The
Toronto- Dominion Bank, as Managing Agents, and The Bank of New York, as
Administrative Agent (the "Credit Agreement"), that (terms defined in the
Credit Agreement that are not otherwise defined herein are used herein with
the meanings therein ascribed to them):
1. (a) The accompanying unaudited consolidated financial statements
of the Borrower and the Consolidated Subsidiaries as at __________ and for the
quarterly accounting period ending ___________, 19__, present fairly, in
accordance with Generally Accepted Accounting Principles (except for changes
therein or departures therefrom described below that have been explained in
the financial statements), the consolidated financial position of the Borrower
and the Consolidated Subsidiaries as at the end of such quarterly period, and
the consolidated results of operations and cash flows for such quarterly
period, and for the elapsed portion of the fiscal year ended with the last day
of such quarterly period, subject only to normal year-end auditing adjustments.
(b) Except as disclosed or reflected in such financial statements,
as at __________, neither the Borrower nor any Subsidiary had any Liability,
contingent or otherwise, or any unrealized or anticipated loss, that, singly
or in the aggregate, have had or could reasonably be expected to have a
Materially Adverse Effect on the Borrower and the Consolidated Subsidiaries
taken as a whole.
2. The changes in and departures from Generally Accepted
Accounting Principles are as follows:
<PAGE> 144
3. The calculations required to establish whether or not the
Borrower was in compliance with the following Sections of the Credit Agreement
are as follows:
(a) Section 4.11.
(b) Section 4.15.
(c) Section 4.16.
(d) Section 4.17.
(e) Section 4.18.
4. Based on an examination sufficient in my judgment to enable me
to make an informed statement, no Default exists, including, in particular, any
such arising under the provisions of Article 4 of the Credit Agreement, except
the following:
[If none such exist, insert "None"; if any do exist,
specify the same by Section, give the date the same occurred, whether it is
continuing, and the steps being taken by the Borrower or a Subsidiary with
respect thereto.]
Dated:
---------------------
[Responsible Officer]
-2-
<PAGE> 145
Schedule 5.01(b)
FORM OF CERTIFICATE AS TO YEAR-END FINANCIAL STATEMENTS
QVC, INC.
I, __________, [Responsible Officer] of QVC, INC., a Delaware
corporation (the "Borrower"), hereby certify, pursuant to Section 5.01(b) of the
Credit Agreement, dated as of _______, 1995, among the Borrower, the banks
listed on the signature pages thereof, The Bank of New York Company, Inc.,
Barclays Bank PLC, Chemical Bank, NationsBank, N.A. (Carolinas) and The Toronto-
Dominion Bank, as Managing Agents, and The Bank of New York, as Administrative
Agent (the "Credit Agreement"), that (terms defined in the Credit Agreement that
are not otherwise defined herein are used herein with the meanings therein
ascribed to them):
1. (a) The accompanying consolidated financial statements of the
Borrower and the Consolidated Subsidiaries as at __________ and for the fiscal
year ending __________, 19 , present fairly, in accordance with Generally
Accepted Accounting Principles (except for changes therein or departures
therefrom described below, that have been explained in the financial
statements), the consolidated financial position of the Borrower and the
Consolidated Subsidiaries as at the end of such fiscal year, and the
consolidated results of operations and cash flows for such fiscal year.
(b) Except as disclosed or reflected in such financial statements,
as at ___________, neither the Borrower nor any Subsidiary had any Liability,
contingent or otherwise, or any unrealized or anticipated loss, that, singly or
in the aggregate, have had or could reasonably be expected to have a Materially
Adverse Effect on the Borrower and the Consolidated Subsidiaries taken as a
whole.
2. The changes in and departures from Generally Accepted
Accounting Principles are as follows:
<PAGE> 146
3. The calculations required to establish whether or not the
Borrower was in compliance with the following Sections of the Credit Agreement
are as follows:
(a) Section 1.06(b).
(b) Section 4.11.
(c) Section 4.15.
(d) Section 4.16.
(e) Section 4.17.
(f) Section 4.18.
4. Based on an examination sufficient to enable me to make an
informed statement, no Default exists, including, in particular, any such
arising under the provisions of Article 4 of the Credit Agreement, except the
following:
[If none such exist, insert "None"; if any do exist,
specify the same by Section, give the date the same occurred,
whether it is continuing, and the steps being taken by the Borrower
or a Subsidiary with respect thereto.]
Dated:
___________________________
[Responsible Officer]
-2-
<PAGE> 147
Schedule 5.02(a)
HISTORICAL FINANCIAL STATEMENTS
<PAGE> 148
Schedule 9.10(a)
FORM OF NOTICE OF ASSIGNMENT
[Name and address
of Borrower in accordance with
Section 9.01(b)(i)]
[Name and address
of Administrative Agent in accordance with
Section 9.01(b)(ii)]
[Name and address
of Issuing Bank in accordance with
Section 9.01(b)(iii)]
Date:
Ladies and Gentlemen:
Reference is made to the Credit Agreement, dated as of _______,
1995, among QVC Programming Holdings, Inc., the banks listed on the signature
pages thereof, The Bank of New York Company, Inc., Barclays Bank PLC, Chemical
Bank, NationsBank, N.A. (Carolinas) and The Toronto- Dominion Bank, as Managing
Agents, and The Bank of New York, as Administrative Agent (the "Credit
Agreement"). Terms defined in the Credit Agreement that are not otherwise
defined herein are used herein with the meanings therein ascribed to them. The
undersigned hereby give notice pursuant to Section 9.10(a) of the Credit
Agreement that [name of Assignor] [(the "Assignor")] has made the following
assignment to [name of Assignee] [(the "Assignee")]:
Amount of rights and obligations assigned:
Effective date of
assignment:
[The Assignee's Lending Offices and address for
notices are as follows:
Domestic Lending Office:
Eurodollar Lending Office:
Notice address:]1
<PAGE> 149
The Assignor hereby requests that the Borrower and the
Administrative Agent consent to the assignment described above by signing a copy
of this letter in the space provided below and returning it to the Assignor.
[NAME OF ASSIGNOR]
By: ___________________________
Name:
Title:
[NAME OF ASSIGNEE]
By: ___________________________
Name:
Title:
Assignment and release consented to:
QVC, INC.
By: __________________________
Name:
Title:
THE BANK OF NEW YORK,
as Administrative Agent and
Swing Loan Lender
By: __________________________
Name:
Title:
_________________________,
as Issuing Bank
By: __________________________
Name:
Title:
___________
1. Omit if the Assignee is a Bank prior to such assignment.
-2-
<PAGE> 150
EXHIBIT A-1
FORM OF TERM A NOTE
QVC, INC.
__________ , 19__
FOR VALUE RECEIVED, QVC, INC., a Delaware corporation (the
"Borrower"), hereby promises to pay to the order of _________ (the
"Bank") the principal amount of ______ Dollars ($ _______ ) or, if less, the
principal amount of the Term A Loans of the Bank outstanding, on the dates and
in the amounts specified in Section 1.05 of the Credit Agreement referred to
below, and to pay interest on such principal amount on the dates and at the
rates specified in Section 1.04 of such Credit Agreement. All payments due the
Bank hereunder shall be made to the Bank at the place, in the type of money and
funds and in the manner specified in Section 1.11 of such Credit Agreement.
Each holder hereof is authorized to endorse on the grid attached
hereto, or on a continuation thereof, each Term A Loan of the Bank and each
payment, prepayment or conversion with respect thereto.
Presentment, demand, protest, notice of dishonor and notice of
intent to accelerate are hereby waived by the undersigned.
This Term A Note evidences Term A Loans made under, and is
entitled to the benefits of, the Credit Agreement, dated as of _____ __, 1995,
among the Borrower (as successor to QVC Programming Holdings, Inc.), the banks
listed on the signature pages thereof, The Bank of New York Company, Inc.,
Barclays Bank PLC, Chemical Bank, NationsBank, N.A. (Carolinas) and The
Toronto-Dominion Bank, as Managing Agents, and The Bank of New York, as
Administrative Agent, as the same may be amended from time to time. Reference is
made to such Credit Agreement, as so amended, for provisions relating to the
prepayment and the acceleration of the maturity of, and for the respective
meanings assigned to the capitalized terms used and not otherwise defined in,
this Term A Note. This Term A Note is also entitled to the benefits of the
Pledge Agreements and the Guaranty Agreements.
This Term A Note shall be construed in accordance with and
governed by the law of the State of New York (without giving effect to its
choice of law principles).
QVC, INC.
By:
-------------------------
Name:
Title:
<PAGE> 151
GRID
NOTE
- -----------------------------------------------------------------------
<TABLE>
<CAPTION>
Amount of
Principal Paid, Unpaid
Amount of Prepaid or Principal Amount Notation
Date Loan Converted of Note Made By
- ---- --------- --------------- ---------------- --------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
</TABLE>
<PAGE> 152
EXHIBIT A-2
FORM OF TERM B NOTE
QVC, INC.
__________, 19__
FOR VALUE RECEIVED, QVC, INC., a Delaware corporation (the
"Borrower"), hereby promises to pay to the order of ___________ (the "Bank")
the principal amount of __________ Dollars ($___________) or, if less, the
principal amount of the Term B Loans of the Bank outstanding, on the dates and
in the amounts specified in Section 1.05 of the Credit Agreement referred to
below, and to pay interest on such principal amount on the dates and at the
rates specified in Section 1.04 of such Credit Agreement. All payments due the
Bank hereunder shall be made to the Bank at the place, in the type of money and
funds and in the manner specified in Section 1.11 of such Credit Agreement.
Each holder hereof is authorized to endorse on the grid attached
hereto, or on a continuation thereof, each Term B Loan of the Bank and each
payment, prepayment or conversion with respect thereto.
Presentment, demand, protest, notice of dishonor and notice of
intent to accelerate are hereby waived by the undersigned.
This Term B Note evidences Term B Loans made under, and is entitled
to the benefits of, the Credit Agreement, dated as of _____ __, 1995, among the
Borrower (as successor to QVC Programming Holdings, Inc.), the banks listed on
the signature pages thereof, The Bank of New York Company, Inc., Barclays Bank
PLC, Chemical Bank, NationsBank, N.A. (Carolinas) and The Toronto-Dominion Bank,
as Managing Agents, and The Bank of New York, as Administrative Agent, as the
same may be amended from time to time. Reference is made to such Credit
Agreement, as so amended, for provisions relating to the prepayment and the
acceleration of the maturity of, and for the respective meanings assigned to the
capitalized terms used and not otherwise defined in, this Term B Note. This Term
B Note is also entitled to the benefits of the Pledge Agreements and the
Guaranty Agreements.
This Term B Note shall be construed in accordance with and governed
by the law of the State of New York (without giving effect to its choice of law
principles).
QVC, INC.
By: ___________________________
Name:
Title:
<PAGE> 153
GRID
NOTE
- -----------------------------------------------------------------------
<TABLE>
<CAPTION>
Amount of
Principal Paid, Unpaid
Amount of Prepaid or Principal Amount Notation
Date Loan Converted of Note Made By
- ---- --------- --------------- ---------------- --------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
</TABLE>
<PAGE> 154
EXHIBIT A-3
FORM OF RC NOTE
QVC, INC.
, 19__
FOR VALUE RECEIVED, QVC, INC., a Delaware corporation (the
"Borrower"), hereby promises to pay to the order of ____________ (the "Bank")
the principal amount of _______ Dollars ($____) or, if less, the principal
amount of the RC Loans of the Bank outstanding, on the dates and in the
amounts specified in Section 1.05 of the Credit Agreement referred to below,
and to pay interest on such principal amount on the dates and at the rates
specified in Section 1.04 of such Credit Agreement. All payments due the Bank
hereunder shall be made to the Bank at the place, in the type of money and
funds and in the manner specified in Section 1.11 of such Credit Agreement.
Each holder hereof is authorized to endorse on the grid attached
hereto, or on a continuation thereof, each RC Loan of the Bank and each payment,
prepayment or conversion with respect thereto.
Presentment, demand, protest, notice of dishonor and notice of
intent to accelerate are hereby waived by the undersigned.
This RC Note evidences RC Loans made under, and is entitled to the
benefits of, the Credit Agreement, dated as of _____ __, 1995, among the
Borrower (as successor to QVC Programming Holdings, Inc.), the banks listed on
the signature pages thereof, The Bank of New York Company, Inc., Barclays Bank
PLC, Chemical Bank, NationsBank, N.A. (Carolinas) and The Toronto-Dominion Bank,
as Managing Agents, and The Bank of New York, as Administrative Agent, as the
same may be amended from time to time. Reference is made to such Credit
Agreement, as so amended, for provisions relating to the prepayment and the
acceleration of the maturity of, and for the respective meanings assigned to the
capitalized terms used and not otherwise defined in, this RC Note. This RC Note
is also entitled to the benefits of the Pledge Agreements and the Guaranty
Agreements.
This RC Note shall be construed in accordance with and governed by
the law of the State of New York (without giving effect to its choice of law
principles).
QVC, INC.
By: ___________________________
Name:
Title:
<PAGE> 155
GRID
NOTE
- -----------------------------------------------------------------------
<TABLE>
<CAPTION>
Amount of
Principal Paid, Unpaid
Amount of Prepaid or Principal Amount Notation
Date Loan Converted of Note Made By
- ---- --------- --------------- ---------------- --------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
</TABLE>
<PAGE> 156
EXHIBIT A-4
FORM OF WORKING CAPITAL NOTE
QVC, INC.
__________, 19__
FOR VALUE RECEIVED, QVC, INC., a Delaware corporation (the
"Borrower"), hereby promises to pay to the order of __________ (the "Bank")
the principal amount of __________ Dollars ($__________ ) or, if less, the
principal amount of the Working Capital Loans of the Bank outstanding, on the
dates and in the amounts specified in Section 1.05 of the Credit Agreement
referred to below, and to pay interest on such principal amount on the dates
and at the rates specified in Section 1.04 of such Credit Agreement. All
payments due the Bank hereunder shall be made to the Bank at the place, in the
type of money and funds and in the manner specified in Section 1.11 of such
Credit Agreement.
Each holder hereof is authorized to endorse on the grid attached
hereto, or on a continuation thereof, each Working Capital Loan of the Bank and
each payment, prepayment or conversion with respect thereto.
Presentment, demand, protest, notice of dishonor and notice of
intent to accelerate are hereby waived by the undersigned.
This Working Capital Note evidences Working Capital Loans made
under, and is entitled to the benefits of, the Credit Agreement, dated as of
_______, 1995, among the Borrower (as successor to QVC Programming Holdings,
Inc.), the banks listed on the signature pages thereof, The Bank of New York
Company, Inc., Barclays Bank PLC, Chemical Bank, NationsBank, N.A. (Carolinas)
and The Toronto-Dominion Bank, as Managing Agents, and The Bank of New York, as
Administrative Agent, as the same may be amended from time to time. Reference is
made to such Credit Agreement, as so amended, for provisions relating to the
prepayment and the acceleration of the maturity of, and for the respective
meanings assigned to the capitalized terms used and not otherwise defined in,
this Working Capital Note. This Working Capital Note is also entitled to the
benefits of the Pledge Agreements and the Guaranty Agreements.
This Working Capital Note shall be construed in accordance with and
governed by the law of the State of New York (without giving effect to its
choice of law principles).
QVC, INC.
By: ___________________________
Name:
Title:
<PAGE> 157
GRID
NOTE
- -----------------------------------------------------------------------
<TABLE>
<CAPTION>
Amount of
Principal Paid, Unpaid
Amount of Prepaid or Principal Amount Notation
Date Loan Converted of Note Made By
- ---- --------- --------------- ---------------- --------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
</TABLE>
<PAGE> 158
EXHIBIT A-5
FORM OF SWING NOTE
QVC, INC.
____________, 19__
FOR VALUE RECEIVED, QVC, INC., a Delaware corporation (the
"Borrower"), hereby promises to pay to the order of ____________ (the "Bank")
the principal amount of Twenty-Five Million Dollars ($25,000,000) or, if less,
the principal amount of the Swing Loans of the Bank outstanding, on the dates
and in the amounts specified in Section 1.05 of the Credit Agreement referred
to below, and to pay interest on such principal amount on the dates and at the
rates specified in Section 1.04 of such Credit Agreement. All payments due the
Bank hereunder shall be made to the Bank at the place, in the type of money and
funds and in the manner specified in Section 1.11 of such Credit Agreement.
Each holder hereof is authorized to endorse on the grid attached
hereto, or on a continuation thereof, each Swing Loan of the Bank and each
payment, prepayment or conversion with respect thereto.
Presentment, demand, protest, notice of dishonor and notice of
intent to accelerate are hereby waived by the undersigned.
This Swing Note evidences Swing Loans made under, and is entitled
to the benefits of, the Credit Agreement, dated as of _____ __, 1995, among the
Borrower, the banks listed on the signature pages thereof, The Bank of New York
Company, Inc., Barclays Bank PLC, Chemical Bank, NationsBank, N.A. (Carolinas)
and The Toronto-Dominion Bank, as Managing Agents, and The Bank of New York, as
Administrative Agent, as the same may be amended from time to time. Reference is
made to such Credit Agreement, as so amended, for provisions relating to the
prepayment and the acceleration of the maturity of, and for the respective
meanings assigned to the capitalized terms used and not otherwise defined in,
this Swing Note. This Swing Note is also entitled to the benefits of the Pledge
Agreements and the Guaranty Agreements.
This Swing Note shall be construed in accordance with and governed
by the law of the State of New York (without giving effect to its choice of law
principles).
QVC, INC.
By: __________________________
Name:
Title:
<PAGE> 159
GRID
NOTE
- -----------------------------------------------------------------------
<TABLE>
<CAPTION>
Amount of
Principal Paid, Unpaid
Amount of Prepaid or Principal Amount Notation
Date Loan Converted of Note Made By
- ---- --------- --------------- ---------------- --------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
</TABLE>
