<PAGE>
FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended 12-31-95
--------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
---------------------------
COMMISSION FILE NUMBER 1-6605
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EQUIFAX INC.
------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
GEORGIA 58-0401110
- ---------------------------------- ------------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION IDENTIFICATION NO.)
P.O. BOX 4081
1600 PEACHTREE ST., N.W., ATLANTA, GA 30302
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Registrant's telephone number, including area code (404) 885-8000
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NAME OF EACH EXCHANGE ON
TITLE OF EACH CLASS WHICH REGISTERED
------------------- ------------------------
COMMON STOCK
($1.25 PAR VALUE) NEW YORK STOCK EXCHANGE
----------------- -----------------------
Securities registered pursuant to Section 12(g) of the Act: NONE
-----------------
(TITLE OF CLASS)
INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED
TO BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING
THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS
REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS. YES [X] NO [ ]
INDICATE BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT TO ITEM 405
OF REGULATION S-K (SECTION 229.405 OF THIS CHAPTER) IS NOT CONTAINED HEREIN, AND
WILL NOT BE CONTAINED, TO THE BEST OF REGISTRANT'S KNOWLEDGE, IN DEFINITIVE
PROXY OR INFORMATION STATEMENTS INCORPORATED BY REFERENCE IN PART III OF THIS
FORM 10-K OR ANY AMENDMENT TO THIS FORM 10-K. [X]
AGGREGATE MARKET VALUE OF THE VOTING STOCK HELD BY NON-AFFILIATES OF THE
REGISTRANT, COMPUTED BY REFERENCE TO THE CLOSING SALES PRICE ON THE NEW YORK
STOCK EXCHANGE ON MARCH 25, 1996: $3,069,822,235.
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE REGISTRANT'S CLASSES OF
COMMON STOCK, AS OF THE LATEST PRACTICABLE DATE.
CLASS OUTSTANDING AT MARCH 25, 1996
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COMMON STOCK, $1.25 PAR VALUE 153,621,594
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DOCUMENTS INCORPORATED BY REFERENCE
THE PROXY STATEMENT FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 1,
1996, IS INCORPORATED BY REFERENCE, TO THE EXTENT INDICATED UNDER ITEMS 10, 11,
12, AND 13, INTO PART III OF THIS FORM 10-K.
<PAGE>
EQUIFAX INC.
PART I
ITEM 1. BUSINESS
- ------------------
Equifax Inc. is structurally a holding company for its corporate
subsidiaries, which conduct the actual operations of the Company. The separate
business areas of the Company are conducted on a "profit center" basis with
self-contained functional integrity, although Equifax Inc. continues to supply
centralized overall financial, legal, public relations, tax and similar
services.
The Company was founded as a credit reporting agency under the name,
"Retail Credit Company" in Atlanta, Georgia, in 1899. Over the next several
years, the Company established itself in the area of investigation of applicants
for insurance. The business grew and, by 1920, the Company had numerous branch
offices throughout the United States and Canada. Since that time, the Company
has continued to expand and diversify by means of internal development and
strategic acquisitions. At the end of 1975, the Company changed its name from
Retail Credit Company to Equifax Inc. The specific products and services
presently offered by the Company are described below.
In January 1993, the Company implemented an open market stock repurchase
program. During 1995, the Company repurchased approximately 6,847,000 shares at
a cost of $132,668,000.
In December 1995, the Company, through its subsidiary Equifax South
America, Inc., purchased an additional 25 percent interest in DICOM S.A., a
Chilean credit reporting company, headquartered in Santiago, Chile. This
purchase increased the Company's ownership to 50 percent. DICOM S.A. provides
credit information services in Chile, Columbia and Peru.
In July 1995, the Company acquired Tecnicob S.A., a French credit card
processing software company headquartered in Paris, France. This operation is
owned by Equifax Europe (U.K.) Ltd.
In July 1995, the Company acquired The Infocheck Group Limited, a provider
of commercial credit referencing services in the United Kingdom. This
operation, headquartered in Godmersham, Canterbury, is owned and operated by
Equifax Europe (U.K.) Ltd.
Also, in July 1995, the Company through its subsidiary Equifax Europe Ltd.,
entered into an agreement with ASNEF-Equifax, the Company's Spanish joint
venture, and Association of Financial Companies, a Portuguese credit reporting
company, to provide the first automated credit reporting services in Portugal.
In April 1995, the Company acquired UCB Services, Inc., a provider of
mortgage credit reports, which is located in Glen Ellyn, Illinois, a suburb of
Chicago. These operations are owned and operated by Equifax Credit Information
Services, Inc.
In March 1995, the Company acquired Medical Review Systems, Inc., an
Atlanta, Georgia based healthcare cost containment company. These operations
are operated by Equifax Healthcare Information Services, Inc.
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<PAGE>
In February 1995, the Company acquired Vallance and Associates, Inc., a
commercial inspection services company, located in Westerville, Ohio. These
operations are owned and operated by Equifax Services Inc.
Reference is made to industry segment information reported in Note 11 of
the Notes to Consolidated Financial Statements, included in Part II, Item 8 of
this report, which is hereby incorporated by reference.
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<PAGE>
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<PAGE>
A description of the products or services provided by each industry segment
as captioned in the aforementioned information, together with information
regarding the companies included within each segment, is as follows:
Credit Services Segment
- -----------------------
This segment includes Equifax Credit Information Services, Inc. and its
wholly-owned subsidiary Credit Northwest Corporation, and Equifax Marketing
Decision Systems, Inc.
The Company's principal class of service for this segment is informational
services for consumer credit report purposes. Customers include retailers,
banks, financial institutions, utilities, petroleum companies, travel and
entertainment card companies, auto finance and leasing firms, educational
institutions and mortgage lenders. In 1995, this class of service accounted for
19.0% of the Company's total operating revenue, as compared with 20.9% in 1994,
and 23.6% in 1993.
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<PAGE>
Companies in this segment primarily furnish consumer credit services, but
also provide decision support and credit management services designed to meet
specific customer needs. This includes consumer credit reporting information,
risk management, collection services, locate services, fraud detection and
prevention, credit card marketing programs, database marketing and database
management systems, mortgage loan origination information, pc-based marketing
systems, geo-demographic systems, mapping tools and modeling and analytical
services, both domestically and internationally. These companies distribute
information to customers through automated delivery, utilizing telephone
transmission facilities.
The Company's consumer credit services operations, including non-owned
affiliate bureaus, compete with two other large automated credit reporting
organizations - TRW Credit Data and Trans Union Corporation. There are also
numerous smaller local bureaus in this field.
Payment Services Segment
- ------------------------
This segment includes Equifax Payment Services, Inc. and its wholly-owned
subsidiaries Equifax Check Services, Inc.; Equifax Card Services, Inc.; Light
Signatures, Inc.; Financial Insurance Marketing Group, Inc.; and First Bankcard
Systems, Inc.
Companies in this segment provide services to national and regional retail
chains, banks, credit unions, savings institutions, automobile dealers and
rental companies, hotel and motels, and others.
The Company's principal class of service for this segment is check guarantee
and check verification services. In 1995, this class of service accounted for
8.6% of the Company's total revenue, as compared with 9.3% in 1994 and 10.1% in
1994.
These companies provide check guarantee services as well as credit card
marketing enhancements and credit and debit card processing services to
merchants and financial institutions. These services include on-line guarantees
or verification of checks written at the point of sale, credit card and debit
card processing for small to medium-size banks, credit unions, and other
financial institutions, flexible credit card marketing enhancements, and
software products for credit card, merchant and collection processing.
Companies in this segment are leading providers of their products and
services in the U.S. although competition is considerable.
Business in this segment is seasonal to some extent. The volume of check
payment services is highest during the Christmas shopping season and during
other periods of increased consumer spending.
International Operations Segment
- --------------------------------
This segment consists of Acrofax Inc.; Equifax Canada Inc. and its wholly-
owned subsidiaries Equifax Canada (AFX) Inc. and Telecredit Canada, Inc.;
Equifax Europe (U.K.) Ltd.; Equifax Europe Ltd, UAPT-Infolink plc; Equifax South
America, Inc.; and Tecnicob, S.A. Also included in this segment are Transax
(50.1%)
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<PAGE>
owned) and Scorex (U.K.) Ltd. (49% owned); ASNEF-Equifax (49% owned);
Organizacion Veraz (33.3% owned); and DICOM (50% owned).
The Company's principal class of service for this segment is consumer
credit reporting. In 1995, this class of service accounted for 6.3% for the
Company's total operating revenue, as compared with 6.2% in 1994 and 6.0% in
1993.
The companies in this segment primarily provide consumer credit services,
but also provide other financial services. In Canada, financial services
include automated business and consumer credit information, accounts receivable
and collection and check guarantee services. In the U.K., consumer and
commercial credit reporting, credit scoring, modeling services and check
guarantee and electronic authorization services are provided. In Spain and
Argentina, technology and expertise are provided to enhance credit information
services. In Chile, commercial, financial and medical information services are
provided.
Equifax Canada Inc. is clearly the market leader in providing consumer
credit in Canada. Telecredit Canada, Inc. faces strong competition. In the
U.K., CCN, a subsidiary of Great Universal Stores, PLC holds the majority share
of the consumer credit market, while Transax is the check guarantee market share
leader. ASNEF-Equifax is a leader in providing credit information services in
Spain. Veraz is the leading information providers in Argentina, while DICOM is
the leading provider in Chile, Columbia and Peru.
Insurance Services Segment
- --------------------------
This segment consists of various business units of Equifax Services Inc.;
Osborn Laboratories, Inc.; The Kit Factory, Inc.; Mid-American Technologies,
Inc.; and Programming Resources Company.
The Company's principal class of service for this segment is providing
information for insurance underwriting purposes. In 1995, this class of service
accounted for 26.4% of the Company's total operating revenue, as compared with
25.9 in 1994 and 25.8% in 1993.
Equifax Services Inc. provides most all major life and health insurance
companies with various informational services for help in determining the
classification of applicants as risks for life and health insurance and for
assistance in settling claims. Also, health data is provided to these companies
for their use in underwriting the health aspects of their risks. Osborn
Laboratories tests blood and urine for life and health insurance applicants.
The Company also provides similar informational services to major property and
casualty insurance companies including motor vehicle records, automated claim
information for automobile and property insurers, automobile reclassification
program management, workers' compensation audits and commercial inspections and
surveys. The Company also provides customized software rating applications for
commercial and personal line insurers. This information is used by insurance
companies in evaluating applicants as risks and as an aid in determining the
applicable rates. Automated information services are distributed through
telephone transmission facilities.
The Company currently ranks first and is the market leader providing
insurance related information services, while Osborn is the second largest
laboratory of its kind in the U.S. Many smaller organizations, which focus on a
limited number of services and which, in some cases, are concentrated in small
geographic areas, provide fragmented competition.
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<PAGE>
General Information Services Segment
- ------------------------------------
This segment consists of Equifax Healthcare Information Services, Inc.;
Equifax Healthcare EDI Services, Inc.; HealthChex, Inc.; Health Economics
Corporation; Equifax Government & Special Systems, Inc.; and High Integrity
Systems, Inc.
The Company's principal class of service for this segment is providing
healthcare information services. In 1995, this class of service accounted for
4.0% of the Company's total operating revenue, as compared with 3.9% in 1994 and
3.2% in 1993.
Companies in this segment providing health care services furnish a broad
range of informational and administrative services which include electronic
claim processing, on-line eligibility verification and claim status, physician
profiling, automatic claim audits, national medical credentials verification,
claims analysis, administration and utilization management, pre-admission
certification, managed care plan services, electronic remittance and hospital
bill audits.
Equifax Healthcare Information Services, Inc., HealthChex, Inc., Equifax
Healthcare EDI Services, Inc., and Health Economics Corporation provide services
to health care providers (hospitals and physicians), managed care organizations,
health plan managers, insurers, purchasers and payers of group health coverage
and governmental agencies.
High Integrity Systems, Inc., was formed to provide a lottery management
system for the California State Lottery.
Competition is strong in all of the above areas. Companies offering health
care services possess relatively small shares or are competing in young and
growing markets. Other than stated above, competition in these areas is
difficult to describe and information concerning such conditions is not material
to a general understanding of the Company's business.
================================================================================
The principal methods of competition for the Company are price, scope,
speed and ease of service and reliability of the information furnished.
None of the Company's segments is dependent on any single customer, and the
Company's largest customer provides less than 10% of the Company's total
revenues.
The Company had approximately 14,200 employees, as of December 31, 1995.
ITEM 2. PROPERTIES
- --------------------
The Company is in a service industry and does not own any mines, extractive
properties or manufacturing plants. Thus, an understanding of the Company's
property holdings is not deemed to be material to an understanding of the
Company's business taken as a whole.
The Company owns a total of four office buildings, one of which is located
in La Habra, California and the other three located in England - one each in
London, Corsham and Salisbury. The Company also owns two office/laboratory
facilities, one of which with an adjoining 1.27 acres of vacant land, in a
suburb of Kansas City, Olathe, Kansas. These office/laboratory facilities are
utilized by the Company's subsidiary, Osborn Laboratories, Inc.
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<PAGE>
The Company ordinarily leases office space of the general commercial type
for conducting its business and is obligated under approximately 378 lease and
other rental arrangements for its headquarters and field locations. The
Company's operating leases involve principally office space and office
equipment. Rental expense relating to these leases was $46,898,000 in 1995,
$46,534,000 in 1994 and $40,798,000 in 1993. In March 1994, the Company sold
and leased back under operating leases certain land and buildings. The net
sales price of $55.1 million approximated the net book value of the related
assets.
Future minimum payment obligations for noncancelable operating leases exceeding
one year are as follows as of December 31, 1995:
<TABLE>
<CAPTION>
(In thousands) Amount
- ---------------- --------
<S> <C>
1996 $38,201
1997 32,312
1998 27,260
1999 21,315
2000 18,697
Thereafter 95,248
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$233,033
========
</TABLE>
ITEM 3. LEGAL PROCEEDINGS
- ---------------------------
Reference is made to Lottery Contract Dispute, Litigation and Settlement
Information reported in Note 3 of the Notes to Consolidated Financial
Statements, included in Part II, Item 8 of this report, which is hereby
incorporated by reference.
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<PAGE>
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<PAGE>
EXECUTIVE OFFICERS OF THE REGISTRANT
- ------------------------------------
The Company's executive officers, as of March 25, 1996, are listed below, with
certain information relating to each of them:
<TABLE>
<CAPTION>
Executive
Name and Position Officer
With Company Age Since
----------------- --- ---------
<S> <C> <C>
D. W. McGlaughlin, President and Chief Executive Officer* 59 1989
Thomas F. Chapman, Executive Vice President* 52 1991
J. C. Chartrand, Executive Vice President* 61 1986
D. V. Smith, Executive Vice President 41 1990
D. J. Kohl, Senior Vice President 39 1995
D. U. Hallman, Senior Vice President and Chief Financial Officer 54 1991
J. T. Chandler, Corporate Vice President 48 1995
R. F. Haygood, Corporate Vice President 48 1993
T. H. Magis, Corporate Vice President, Secretary and General Counsel 55 1991
P. J. Mazzilli, Corporate Vice President & Controller 55 1995
M. E. Zakas, Corporate Vice President and Treasurer 37 1995
</TABLE>
*Also serves as a Director
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<PAGE>
There are no family relationships among the officers of the Company, nor are
there any arrangements or understandings between any of the officers and any
other persons pursuant to which they were selected as officers. The Board of
Directors may elect an officer or officers at any meeting of the Board. Each
elected officer is selected to serve until the date of the Annual Meeting of the
Shareholders in each year.
Messrs. McGlaughlin, Chapman and Chartrand have each served as an officer of
the Company for at least five years. Messrs. Smith, Magis, Hallman and Haygood
have served in various executive capacities with the Company or its subsidiaries
for more than five years before becoming an officer.
Mr. Kohl, prior to his election as Senior Vice President in July 1995, served
as an executive in the Company's healthcare information services group since
1993. Prior to joining the Company, he served as corporate vice president for
operations at Healthdyne, Inc., a home healthcare services company. Before
this, he served two years as president of HMSS, Inc., a home infusion therapy
company and three years as chief operating officer of Abbey Healthcare, Inc., a
home healthcare services company.
Ms. Zakas, prior to her election as Corporate Vice President and Treasurer in
January 1996, served as Corporate Vice President-Investor Relations since
October 1995. Prior to that, she served as Vice President and Director of
Investor Relations of the Company since September 1993. Prior to that, she
served at Holiday Inn Worldwide, an international hotel chain, as Director-
Strategic Planning and Analysis from 1992-1993 and as Director-Project Finance
from 1991-1992. From 1984 until 1991, she worked at Morgan Stanley and Co., an
investment banking firm, in the areas of capital market services and corporate
finance.
Mr. Chandler, prior to his election as Corporate Vice President in October
1995, served as Vice President-Compensation and Benefits Administration. Before
joining the Company in 1991, he served as vice president of executive
compensation and benefits for C&S/Sovran Corporation, a national bank, now known
as NationsBank, N.A., for a period of four years.
Mr. Mazzilli, prior to his election as Corporate Vice President and Controller
in October 1995, served as Vice President and Controller of the Company since
1992. Before joining the Company in 1992, he served as Vice President,
Management Services for the Equitable Life Insurance Company for a period of six
years.
PART II
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ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
- ------- -----------------------------------------------------
STOCKHOLDER MATTERS
-------------------
The Company's common stock is listed and traded on the New York Stock Exchange,
which is the principal market on which said stock is traded.
<TABLE>
<CAPTION>
DIVIDENDS PER SHARE
<S> <C> <C> <C> <C> <C> <C>
Quarter 1990 1990 1992 1993 1994 1995
- --------------------- ------ ------ ------ ------ ------ ------
First $0.060 $0.065 $0.065 $0.070 $0.070 $0.078
Second 0.060 0.065 0.065 0.070 0.078 0.078
Third 0.060 0.065 0.065 0.070 0.078 0.078
Fourth 0.060 0.065 0.065 0.070 0.078 0.083
- --------------------- ------ ------ ------ ------ ------ ------
Annual $0.240 $0.260 $0.260 $0.280 $0.303 $0.315
- --------------------- ------ ------ ------ ------ ------ ------
</TABLE>
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<PAGE>
STOCK PRICES
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
(In Dollars) 1992 1993 1994 1995
- -------------------------------------------------------------------------------
High Low High Low High Low High Low
<S> <C> <C> <C> <C> <C> <C> <C> <C>
First Quarter 9.375 7.50 11.188 09.563 13.688 10.938 17 12.625
Second Quarter 9.688 7.188 10.500 8.688 15.188 11.563 17.5 15.313
Third Quarter 8.563 7.188 13.063 9.875 15.125 13.375 21.063 16.313
Fourth Quarter 10.313 7.313 13.688 11.438 15.25 12.000 21.75 18
Year 10.313 7.188 13.688 8.688 15.25 10.938 21.75 12.625
</TABLE>
As of March 25, 1996, there were approximately 9,508 holders of record of
the Company's common stock.
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<PAGE>
ITEM 6. SUMMARY OF SELECTED FINANCIAL DATA
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PART I (1995 - 1992)
<TABLE>
<CAPTION>
(Dollars in thousands, except per share amounts)
- --------------------------------------------------------------------------------------------------------------
Year ended December 31 1995 1994 1993 1992
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SUMMARY OF OPERATIONS
Operating revenue $1,622,958 $1,421,996 $1,217,217 $1,134,333
Operating costs and expenses before unusual items 1,360,019 1,207,889 1,049,750 992,995
Unusual items - - (48,438) -
------------ ------------ ------------ ------------
Operating income 262,939 214,107 119,029 141,338
Other income 7,471 8,994 3,890 7,482
Interest expense (21,172) (15,624) (10,923) (4,029)
------------ ------------ ------------ ------------
Income before income taxes and accounting changes 249,238 207,477 111,996 144,791
Provision for income taxes 101,588 87,131 48,481 59,445
------------ ------------ ------------ ------------
Income before accounting changes 147,650 120,346 63,515 85,346
Cumulative prior years' effect of changes in
accounting principles* - - - -
------------ ------------ ------------ ------------
Net income $147,650 $120,346 $63,515 $5,346
============ ============ ============ ============
Dividends paid $50,223 $47,161 $42,041 $42,770
PER COMMON SHARE DATA
Income before accounting changes $0.98 $0.81 $0.42 $0.52
Cumulative prior years' effect of changes in
accounting principles - - - -
------------ ------------ ------------ ------------
Net income $0.98 $0.81 $0.42 $0.52
============ ============ ============ ============
Dividends $0.315 $0.303 $0.280 $0.260
Weighted average common shares outstanding 151,357,000 148,608,000 150,114,000 163,918,000
BALANCE SHEET DATA
Assets at December 31 $1,053,695 $1,021,174 $731,201 $708,882
Long-term debt at December 31 $302,665 $211,967 $200,070 $191,749
Shareholders' equity at December 31 $353,422 $361,859 $254,031 $257,990
Common shares outstanding at December 31 147,245,000 151,790,000 149,618,000 151,550,000
OTHER INFORMATION
Stock price per share at December 31 $21.38 $13.19 $13.69 $10.31
Book value per share at December 31 $2.40 $2.38 $1.70 $1.70
Market capitalization at December 31 $3,147,362 $2,001,731 $2,047,896 $1,562,859
Number of employees at December 31 14,200 14,200 12,800 12,400
</TABLE>
* The 1991 accounting change is for SFAS No. 106, "Postretirement Benefits Other
Than Pensions".
The 1988 accounting change is for SFAS No. 96, "Accounting for Income Taxes".
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<PAGE>
PART II (1991 - 1988)
<TABLE>
<CAPTION>
(Dollars in thousands, except per share amounts)
- --------------------------------------------------------------------------------------------------------------
Year ended December 31 1991 1990 1989 1988
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SUMMARY OF OPERATIONS
Operating revenue $1,093,827 $1,078,753 $1,001,617 $894,482
Operating costs and expenses before unusual items 969,136 941,976 881,606 801,785
Unusual items (32,044) (21,793) (14,656) (27,669)
------------ ------------ ------------ ------------
Operating income 92,647 114,984 105,355 65,028
Other income 8,128 11,055 9,712 5,648
Interest expense (7,253) (13,177) (10,365) (3,331)
------------ ------------ ------------ ------------
Income before income taxes and accounting changes 93,522 112,862 104,702 67,345
Provision for income taxes 39,424 48,932 41,170 33,295
------------ ------------ ------------ ------------
Income before accounting changes 54,098 63,930 63,532 34,050
Cumulative prior years' effect of changes in
accounting principles* (48,991) - - 5,400
------------ ------------ ------------ ------------
Net income $5,107 $63,930 $63,532 $39,450
============ ============ ============ ============
Dividends paid $42,623 $35,823 $32,003 $22,948
PER COMMON SHARE DATA
Income before accounting changes $0.33 $0.39 $0.40 $0.22
Cumulative prior years' effect of changes in
accounting principles (0.30) - - 0.04
Net income $0.03 $0.39 $0.40 $0.26
------------ ------------ ------------ ------------
Dividends $0.260 $0.240 $0.215 $0.195
============ ============ ============ ============
Weighted average common shares outstanding 163,856,000 161,930,000 160,552,000 154,380,000
BALANCE SHEET DATA
Assets at December 31 $716,103 $754,279 $685,188 $528,287
Long-term debt at December 31 $77,114 $143,050 $88,883 $30,169
Shareholders' equity at December 31 $350,314 $373,306 $339,918 $297,914
Common shares outstanding at December 31 164,294,000 162,424,000 161,058,000 159,974,000
OTHER INFORMATION
Stock price per share at December 31 $7.94 $8.13 $8.00 $6.78
Book value per share at December 31 $2.13 $2.30 $2.11 $1.86
Market capitalization at December 31 $1,304,084 $1,319,695 $1,288,464 $1,084,864
Number of employees at December 31 13,400 14,200 13,900 13,500
</TABLE>
* The 1991 accounting change is for SFAS No. 106, "Postretirement Benefits Other
Than Pensions".
The 1988 accounting change is for SFAS No. 96, "Accounting for Income Taxes".
- 14 -
<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
- ------- -------------------------------------------------
CONDITION AND RESULTS OF OPERATION
----------------------------------
This discussion and analysis should be read in conjunction with the consolidated
financial statements and accompanying notes.
RESULTS OF OPERATIONS
Consolidated revenue for the year was $1.62 billion, an increase of $201.0
million or 14.1% over 1994. This increase is slightly less than the 16.8%
increase in 1994, due primarily to the divestitures occurring in 1995. Revenue
increased 7.9% in 1995 compared to 8.1% in 1994 after adjusting for acquisitions
and divestitures (Note 2). Revenue growth in 1996, excluding 1996 acquisitions,
should be slower than in 1995 or 1994, due to the full-year impact of 1995
divestitures and the slower pace of 1995 acquisitions over 1994.
Operating income of $262.9 million increased $48.8 million or 22.8% in 1995. In
1994, operating income increased $46.6 million before the 1993 unusual charge
(discussed below). The improvements in both years are the result of revenue
increases in the higher margin businesses as well as continuing expense controls
throughout the organization. The operating income margin in 1995 was 16.2%
compared to 15.1% in 1994. The gains in 1995 were achieved despite very
competitive conditions both domestically and internationally, as well as
investments in integrating acquisitions and new products. acquisitions and
divestitures increased 1995 operating income by about 2.7 percentage points, but
were slightly dilutive to net income and earnings per share due to higher
interest cost and outstanding shares. The effects of acquisitions on operating
income, net income and earnings per share were immaterial in 1994.
Earnings per share increased 21.0% to $.98 in 1995 from $.81 in 1994. For the
year, the average shares outstanding increased 1.8% primarily due to stock
issued in connection with 1994 acquisitions.
Net income was $147.6 million in 1995, an increase of 22.7% versus 1994's net
income of $120.3 million. During the third quarter of 1993, the Company
recorded an unusual charge of $48.4 million ($30.9 million after tax, or $.21
per share) to write down the assets of its subsidiary, High Integrity Systems,
Inc. (HISI), and accrue for costs related to litigation with the California
State Lottery. Equifax settled this litigation in July 1995, pending the
execution of a reinstated contract, which was completed in November 1995
(Note 3).
Equifax received a $25 million payment from the California State Lottery during
the fourth quarter 1995 in connection with the reinstatement of the lottery
contract with HISI. The $25 million payment was partially offset by certain
expenses associated with the contract, resulting in a net gain of $19.7 million.
In February 1996, Equifax's HISI announced that it had signed a subcontract with
GTECH for services on its California lottery contract. Under the agreement,
HISI subcontracted many of its obligations under the reinstated contract to
GTECH. In connection with this subcontract, Equifax received $58 million which
will be recognized as revenue net of related expenses over the 66-month life of
the contract.
Also, during the fourth quarter, the Company provided for certain restructuring
charges in the operating groups totaling $19.6 million, in connection with
reduced staffing levels, lease terminations and the discontinuance of a certain
product line.
There are five reporting segments: Credit Services, Payment Services and
International Operations
- 15 -
<PAGE>
(comprising the Financial Services Group), Insurance Services, and General
Information Services. These segments generally follow the Company's internal
management organization and are based on similarities in product lines and
industries served. The following discussion analyzes (1) revenue and operating
income by the five segments, (2) general corporate expense, (3) consolidated
other income, interest expense and effective income tax rates and (4) financial
condition. Note 10 breaks out the segment results by quarter for 1995 and 1994.
<TABLE>
<CAPTION>
Credit Services
- ----------------------------------------------------------------------------
(in millions) 1995 1994 1993
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Revenue $512.7 $476.4 $427.8
Operating income* $180.1 $149.9 $133.0
</TABLE>
*before restructuring charge of $3.2 million in 1995 (Note 9)
Credit Services is part of Financial Services Group and comprises Credit
Reporting Services, Risk Management Services, Equifax National Decision Systems
and Mortgage Services. Revenue growth in Credit Services was 7.6% in 1995,
compared to 11.4% in 1994. Acquisitions accounted for 0.7 percentage points of
the 1995 revenue increase and 5.6 percentage points of the 1994 revenue
increase.
The revenue increase in 1995 was driven by Credit Reporting Services as a result
of growth in its prescreening business for credit card issuers, as well as
volume growth in the utilities, mortgage, national credit card and automotive
industries. Improved quality and turnaround time allowed Equifax to gain market
share in the competitive business of prescreening for credit card applicants.
Pricing pressure continues within Credit Reporting Services. As a result, unit
prices modestly declined. However, unit volume increases more than offset
declines, and market share growth continued. Pricing pressures are expected to
persist, but volume growth is expected to continue to more than offset declines.
Credit Reporting Services continues to provide new services and products, such
as Decision Power, which contributed to the revenue growth in 1995 and are
expected to make an even greater contribution in 1996.
Revenue in Risk Management Services increased 11.5% as a result of new customers
from the outsourcing of many collections operations in the telecommunications
and national credit card industries. Revenue also increased as a result of
increased government student loan business.
National Decision Systems introduced several new products in 1995. the most
significant is expected to be those of Business Geometrics, which did incur
development expenses in 1995. Despite these costs, operating income in National
Decision Systems increased slightly for the year.
During the second quarter, UCB Services was acquired and integrated with
Mortgage Services. Driven by falling interest rates, the mortgage lending
industry had an unusually high level of activity over the last several months of
the year, although for the year, revenue in Mortgage Services decreased 14.9%.
Production volume remained strong, and the industry continues to move to UCB
Services' main lower-priced automated product.
Operating income increased 20.2% in 1995 following a 12.7% increase in 1994.
These increases were driven by revenue growth, operating leverage and ongoing
expense management. This segment reported continued margin increases.
During the fourth quarter of 1995, a restructuring charge of $3.2 million was
recorded primarily to reduce fixed expenses associated with Mortgage Services,
reflecting the increasingly automated nature of the
- 16 -
<PAGE>
marketplace. The charge was taken to consolidate the number of offices from
seven to three and reduce staffing levels.
<TABLE>
<CAPTION>
Payment Services
- ----------------------------------------------------------------------------
(In millions) 1995 1994 1993
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Revenue $284.4 $246.6 $210.4
Operating income* $ 64.0 $ 57.5 $ 51.9
</TABLE>
*before restructuring charge of $0.5 million in 1995 (Note 9)
Payment Services is part of Financial Services and consists of Check Services,
Card Services and FBS Software. Revenue increased 15.3% in 1995, with 3.8
percentage points attributable to the 1994 acquisitions of First Security
Processing Services (FSPS) and FBS Software. Check Services revenue increased
4.5%, while Card Services revenue increased 24.6%, with the FSPS acquisition
accounting for 5.1 percentage points of the increase in Card Services' revenue.
In 1994, Payment Services revenue increased 17.2% with 5.1 percentage points
attributable to the acquisitions of FSPS and FBS Software. In 1994, Check
Services revenue increased 8% and Card Services revenue, excluding FSPS,
increased 18%.
The dollar amount of checks guaranteed by Check Services and the average
discount rate remained unchanged versus 1994. At the end of the third quarter
1995, one of Check Services' larger customers began authorizing its own checks
in-house. Consequently, Check Services' fourth quarter 1995 revenue declined
versus 1994, and 1996 annual revenue and operating income are expected to
decline slightly from 1995 results. Equifax had expected to lose another large
customer beginning January 1996, however, the customer decided against
authorizing its own checks. Nevertheless, the possibility remains that other
customers could choose to move their check authorization in-house.
Growth within Card Services is attributable to the higher number of cardholder
accounts processed, due to business from new customers (i.e., credit unions and
IBAA member banks) that either converted to or began using Equifax Card Services
credit and debit card processing services, as well as growth in processing of
existing cardholder and merchant transactions. During 1994, a contract with
IBAA Bancard Inc. was renewed and a contract with Card Services for Credit
Unions, Inc. (CSCU) took effect, both for a five-year term with incremental
revenue due to increased service levels provided. IBAA Bancard is a service of
the IBAA Community Banking Network, a wholly-owned subsidiary of the Independent
Bankers' Association of America (the "Association"). Through a processing
agreement with Equifax Card Services, IBAA Bancard provides banks that are
members of the association with a comprehensive credit and debit card program.
Payment Services operating income increased $6.5 million in 1995 versus a $5.6
million increase in 1994. Operating income in Check Services was down modestly,
as a result of higher claims losses and higher operating and selling expenses.
Operating income for Card Services increased 33.8% in 1995, due to the operating
leverage achieved with the strong revenue growth, as well as the FSPS
acquisition. The increase in operating income for Payment Services in 1994
versus 1993 was driven primarily by higher profits resulting from higher revenue
in Card Services.
In 1996, the Company expects continued strong growth in the Card Services area
as a result of a growing customer base with the addition of banks and credit
unions that are members of the IBAA and CSCU organizations. This growth will be
tempered by an expected decline within Check Services. Payment Services is
expected to record modest operating income growth in 1996, despite the expected
decline
- 17 -
<PAGE>
within Check Services and one-time expenses associated with a major move to a
new location in the Tampa area.
<TABLE>
<CAPTION>
Insurance Services
- ----------------------------------------------------------------------------
(in millions) 1995 1994 1993
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Revenue $516.9 $453.4 $396.5
Operating income* $ 43.9 $ 18.5 $ 5.5
</TABLE>
*before restructuring charge of $9.2 million in 1995 (Note 9)
Revenue increased 14.0% in 1995 within Insurance Services versus an increase of
14.3% in 1994 as a result of the improved performance of all business units,
acquisitions and increased MVR (Motor Vehicle Records) registry revenue.
Insurance Services consists of Field Services, Data Services, Commercial
Specialists, PRC, CUE UK and Osborn Laboratories. Revenue from Field Services,
which includes Medical Products, Employment Services, Business Services and
Claims Services, increased 3.1% in 1995 versus a decline of $3 million in 1994.
The increase in 1995 is primarily the result of increased market share in
Medical Products due to a changing competitive landscape and continued growth
outside the traditional customer base in Employment and Business Services.
Revenue from Data Services products increased $5.7 million for 1995, despite
competitive pricing pressure which is expected to continue in 1996. The Data
Services revenue results were achieved through increased volume in most product
lines and higher market share. MVR registry revenue was up $19.8 million in
1995 due to continued growth in MVR units, but at a lower rate than experienced
in 1994. In 1994, unit growth in MVR Registry was primarily attributable to a
new contract that was entered into in mid-1993 with a large property and
casualty insurance company. Revenue in Commercial Specialists was up 5.7% for
the year. PRC and Osborn Laboratories accounted for the balance of the revenue
increase due to their inclusion for the full year in 1995 versus a partial year
in 1994.
In 1995, operating income more than doubled to $43.9 million. This increase
resulted from the strong performance of Data Services, cost controls within
Field Services, continued improvement in CUE UK and Commercial Specialists, and
the full year impact of 1994 acquisitions. Data Services posted an increase in
operating income due to the leverage inherent with increased market share. In
1994, operating income for Insurance Services increased $13.0 million versus
1993 due primarily to the strong performance of Data Services and Commercial
Specialists, the reduction in losses within Field Services and the impact of
acquisitions.
The focus on expense reduction and cost management within Field Services
continues to yield significantly improved results. Staffing levels are down by
15% over the last two years. Where applicable, services have been automatedor
discontinued. The overall cost structure has been improved while experiencing a
modest increase in revenue in 1995. The results are substantially improved
versus 1994, as this unit was slightly profitable for the year. The Company
believes that the continuation of these efforts is necessary as the demand for
labor-intensive products continues to diminish.
CUE UK, a database product for the United kingdom's insurance industry, was
developed pursuant to a contract signed in November 1993. Late in 1994, CUE
Home was introduced, and, during the fourth quarter of 1995, CUE Motor became
available. This business unit reported a profit in 1995, despite the
developmental costs for CUE Motor, and its performance is expected to continue
to improve in 1996.
During the fourth quarter, a charge of $9.2 million was taken, primarily in
Field Services, to reduce staffing levels and bring fixed expenses in line with
expected revenue levels. Technology initiatives have been
- 18 -
<PAGE>
targeted for field and home office systems improvement in 1996.
<TABLE>
<CAPTION>
International Operations
- ----------------------------------------------------------------------------
(in millions) 1995 1994 1993
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Revenue $211.0 $143.4 $97.3
Operating income* $21.7 $16.5 $18.1
</TABLE>
*before restructuring charge of $1.7 million in 1995 (Note 9)
International Operations consists of Credit Services and Payment Services
operations in Europe (primarily in the United Kingdom) and Canada. Equifax also
has Credit Services joint ventures in Europe and South America. Revenue for the
year was up 47.2% in 1995, primarily due to significant acquisition activity
which accounted for 42.7 percentage points of the 1995 revenue increase. In
1994, this segment's revenue was up 47.4% primarily due to acquisitions.
Canadian revenue, exclusive of acquisitions and the second quarter 1995 sale of
the Canadian field services insurance products business, was down 2.2% in 1995.
This resulted from lower revenues within Credit Reporting Services due primarily
to the sluggish Canadian economy and increased competition. Canada cheque
services continues to grow revenue and gain market share.
Revenue from European operations increased 12.0% in 1995 excluding acquisitions.
During the third quarter, Equifax acquired the Infocheck Group, a U.K.-based
commercial credit reporting company. the revenue gain in Europe in 1995
continued the trend of revenue growth due to market share gains in Credit
Services.
Operating income for International Operations increased 31.7% in 1995 versus a
decline of 8.9% in 1994 primarily due to improved results in Europe. Operations
in Canada posted an operating income increase in 1995 as a result of the
divestiture of its unprofitable field services insurance products business,
partially offset by lower profits due to the revenue decline in Canadian Credit
Reporting Services.
In Europe, operating efficiencies resulting from the integration of the Infolink
acquisition began to be realized during the last half of 1995. The combination
of Infolink and the existing credit reporting business has enhanced the value of
our databases and created substantial savings by eliminating duplicate costs.
The synergies from the combined businesses should result in continued cost
savings in 1996 and beyond.
During the fourth quarter, a restructuring charge of $1.7 million was taken
within Canadian operations to reduce staffing levels and other fixed expenses.
<TABLE>
<CAPTION>
General Information Services
- ----------------------------------------------------------------------------
(in millions) 1995 1994 1993
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Revenue $97.9 $102.2 $85.2
Operating income (loss)* $(11.7) $1.0 $(11.5)
</TABLE>
*excludes income from lottery settlement of $19.7 million and restructuring
charge of $4.4 million in 1995 and lottery contract provision of $48.4 million
in 1993 (Notes 3 and 9)
This segment comprises recently-acquired healthcare operations, development
projects, marketing services operations and HISI, the lottery subsidiary. The
revenue decline in 1995 of $4.4 million is
- 19 -
<PAGE>
attributable to the divestitures of two marketing companies during the third
quarter 1995, partially offset by acquisitions and growth within Healthcare
Information Services. During the third quarter of 1995, Equifax sold Elrick &
Lavidge and Quick Test, two of its marketing services companies. Equifax sold
these two companies to focus better on its core businesses. Excluding the
effects of non-comparable acquisitions and the divestitures of the two marketing
companies, General Information Services' 1995 revenue increased 8.3%, with
Healthcare Information Services increasing 6.4%. In 1994, revenue was up $17.0
million, largely due to acquisitions made during the year.
This segment's operating loss in 1995 was $11.7 million versus operating income
of $1.0 million in 1994. The 1995 operating loss is due primarily to higher
expenses associated with the integration of healthcare acquisitions and the
development of Medical Credentials Verification Service (MCVS). MCVS is an
internally developed database product which allows managed care organizations
and hospitals to verify physician credentials. Revenues and profits from MCVS
did not meet expectations in 1995, as market acceptance of this product was
slower than expected. As a result, this product has been redefined and
repriced, and MCVS is expected to see reasonable revenue growth, approaching
break-even later in 1996. In 1994, the segment realized a one-time $4.2 million
gain on the fourth quarter sale of its interest in FYI On-Line, a joint venture
with MCI.
Healthcare Information Services is composed of Healthcare Administrative
Services, Healthcare EDI Services, Healthcare Analytical Services, Healthcare
Database Services (MCVS) and Government and Special Systems. In total, we
expect the Healthcare Information Services business units to improve their
performance in 1996; however, they are still expected to show a modest loss. We
are optimistic that the need to reduce healthcare administrative costs and
improve the quality of care drives opportunity for our Healthcare Information
Services business units.
During the fourth quarter, Equifax received a $25 million payment from the
California State Lottery in connection with the reinstatement of the lottery
contract with Equifax's subsidiary, HISI. Partially offsetting this $25 million
payment were expenses associated with the contract, resulting in a net gain of
$19.7 million.
A restructuring charge of $4.4 million was taken during the fourth quarter
largely to reduce staffing levels within Healthcare Information Services and to
write off a discontinued product line.
<TABLE>
<CAPTION>
General Corporate Expense
- ----------------------------------------------------------------------------
(in millions) 1995 1994 1993
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Expense $35.1 $29.2 $29.6
</TABLE>
*before restructuring charge of $0.5 million in 1995 (Note 9)
General corporate expense increased $5.9 million in 1995, due primarily to
higher performance share plan expense, driven by the Company's higher share
price. General corporate expense was essentially flat in 1994.
<TABLE>
<CAPTION>
Other Income, Interest Expense And Effective Income Tax Rates
- ----------------------------------------------------------------------------
(dollars in millions) 1995 1994 1993
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Other income $7.5 $9.0 $3.9
Interest expense $21.2 $15.6 $10.9
Effective income tax rate 40.8% 42.0% 43.3%
</TABLE>
- 20 -
<PAGE>
Other income consists primarily of investment interest and dividends.
Fluctuations between years was caused primarily by certain non-recurring items
recorded in each of the years.
The increase in interest expense reflects the higher levels of borrowing due to
acquisitions and share repurchases.
The effective tax rate of 40.8% in 1995 was lower than 1994's rate due in large
part to a change in the mix of foreign income between tax jurisdictions with
different effective tax rates. The effective tax rate of 42% in 1994 was lower
than in 1993 due to the limited state income tax benefits related to the HISI
write-off and operating losses in 1993.
FINANCIAL CONDITION
Equifax's financial condition remained strong in 1995. Net cash provided by
operations was $159.9 million, compared with $162.6 million in 1994. Normal
capital expenditures, working capital needs and dividend payments were all met
with internally generated funds. Working capital increased $40.2 million during
the year.
During 1995, the Company made acquisitions and equity investments totaling $28.8
million, $8.7 million in payments related to 1994 acquisitions, $10.0 million to
provide financing to Physician Computer Network (PCN) (Note 2) and also
repurchased 6.8 million of its own common shares in open market transactions
totaling $132.7 million. These transactions were principally financed by a
combination of $70.9 million net increase in long-term debt, excess cash
generated from operations and existing cash reserves.
Capital expenditures for 1995, exclusive of acquisitions and the PCN financing,
were $49.0 million. Capital expenditures for 1996 are projected to total
approximately $91 million, but other expenditures are possible as new investment
opportunities arise. Capital expenditures are expected to be higher in 1996 due
to investments in new products and services, improved systems, and the Payment
Services move to a new site in the Tampa area. Budgeted expenditures should be
met with internally generated funds.
In August 1995, the Company structured a new revolving credit facility with
eight banks totaling $550 million that will expire in the year 2000. It
replaces the old $450 million facility. At December 31, 1995, $550 million was
available under the new facility which remains available to fund future capital
requirements, including the possible purchase of the CSC collections and credit
reporting businesses (Note 8). The Company is also beginning to investigate
additional long-term notes to finance the potential share repurchases associated
with the Board of Directors authorization in 1995 (Note 6). Management feels
that the Company's liquidity will remain strong in both the short term and long
term, and that the Company has sufficient debt capacity to finance all of these
requirements, if necessary.
- 21 -
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
- -----------------------------------------------------
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
(In thousands)
- ----------------------------------------------------------------------------
December 31 1995 1994
- ----------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $26,136 $79,409
Accounts receivable, net of allowance for doubtful
accounts of $7,077 in 1995 and $6,516 in 1994 258,335 242,645
Deferred income tax assets 30,594 26,472
Other current assets 51,611 27,353
------- -------
Total current assets 366,676 375,879
------- -------
Property and Equipment:
Land, buildings and improvements 18,050 13,841
Data processing equipment and furniture 218,699 203,189
------- -------
236,749 217,030
Less-Accumulated depreciation 148,901 132,792
------- -------
87,848 84,238
------- -------
Goodwill 353,571 331,438
------- -------
Purchased Data Files 74,828 85,621
------- -------
Other 170,772 143,998
------- -------
$1,053,695 $1,021,174
========== ==========
</TABLE>
The accompanying notes are an integral part of these balance sheets.
- 22 -
<PAGE>
<TABLE>
<CAPTION>
(In thousands, except par value)
- ------------------------------------------------------------------------------------
December 31 1995 1994
- ------------------------------------------------------------------------------------
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Short-term debt and current maturities of long-term debt $20,384 $63,713
Accounts payable 62,194 53,561
Accrued salaries and bonuses 27,919 29,410
Income taxes payable - 21,204
Other current liabilities 140,123 132,158
-------- --------
Total current liabilities 250,620 300,046
-------- --------
Long-Term Debt, Less Current Maturities 302,665 211,967
------- -------
Postretirement Benefit Obligation 80,885 83,029
------- -------
Other Long-Term Liabilities 66,103 64,273
------- -------
Commitments and Contingencies (Note 8)
Shareholders' Equity:
Common stock, $1.25 par value; shares
authorized - 250,000; issued - 168,812 in 1995
and 166,777 in 1994; outstanding - 147,245 in
1995 and 151,790 in 1994 211,015 208,471
Paid-in capital 171,020 145,859
Retained earnings 269,986 175,894
Cumulative foreign currency translation adjustment (13,777) (13,386)
Treasury stock, at cost, 14,847 shares in 1995
and 8,187 shares in 1994 (Note 6) (218,613) (87,975)
Stock held by employee benefits trusts, at cost,
6,719 shares in 1995 and 6,800 shares in 1994 (Note 6) (66,209) (67,004)
---------- ----------
Total shareholders' equity 353,422 361,859
---------- ----------
$1,053,695 $1,021,174
========== ==========
</TABLE>
- 23 -
<PAGE>
CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
(In thousands, except per share amounts)
- ---------------------------------------------------------------------------------------------------
Year Ended December 31 1995 1994 1993
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Operating revenue $1,622,958 $1,421,996 $1,217,217
---------- ---------- ----------
Costs and expenses:
Costs of services 1,038,881 905,307 780,429
Selling, general and administrative expenses 321,231 302,582 269,321
Provision (credit) related to lottery contract (Note 3) (19,665) - 48,438
Restructuring provision (Note 9) 19,572 - -
---------- ---------- ----------
Total costs and expenses 1,360,019 1,207,889 1,098,188
Operating income 262,939 214,107 119,029
Other income, net 7,471 8,994 3,890
Interest expense 21,172 15,624 10,923
---------- ---------- ----------
Income before income taxes 249,238 207,477 111,996
Provision for income taxes 101,588 87,131 48,481
---------- ---------- ----------
Net income $147,650 $120,346 $63,515
========== ========== ==========
Weighted average common shares outstanding 151,357 148,608 150,114
========== ========== ==========
Per common share:
Net income $0.98 $0.81 $0.42
========== ========== ==========
Dividends $0.315 $0.303 $0.280
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
- 24 -
<PAGE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
(In thousands)
- -------------------------------------------------------------------------------------------------
Year Ended December 31 1995 1994 1993
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock:
Balance at beginning of year $208,471 $206,554 $205,821
Shares issued under stock plans 2,544 1,917 733
-------- -------- --------
Balance at end of year $211,015 $208,471 $206,554
======== ======== ========
Paid-In Capital:
Balance at beginning of year $145,859 $108,807 $104,262
Shares issued under stock plans 17,243 12,930 4,545
Adjustment for treasury stock reissued for acquisitions 884 20,267 -
Other 7,034 3,855 -
-------- -------- --------
Balance at end of year $171,020 $145,859 $108,807
======== ======== ========
Retained Earnings:
Balance at beginning of year $175,894 $102,709 $81,235
Net income 147,650 120,346 63,515
Cash dividends (50,223) (47,161) (42,041)
Other (3,335) - -
-------- -------- --------
Balance at end of year $269,986 $175,894 $102,709
======== ======== ========
Cumulative Foreign Currency Translation Adjustment:
Balance at beginning of year $(13,386) $(10,077) $(6,349)
Adjustment during year (391) (3,309) (3,728)
--------- -------- --------
Balance at end of year $(13,777) $(13,386) $(10,077)
Treasury Stock:
Balance at beginning of year $(87,975) $(92,870) $(126,979)
Cost of shares repurchased (132,668) (57,985) (26,983)
Cost of shares transferred to employee benefits trusts - 5,912 61,092
Cost of shares reissued for acquisitions 2,030 56,968 -
--------- -------- ---------
Balance at end of year $(218,613) $(87,975) $(92,870)
========== ========= =========
Stock Held By Employee Benefits Trusts:
Balance at beginning of year $(67,004) $(61,092) $-
Cost of shares transferred from treasury stock - (5,912) (61,092)
Cost of shares reissued under stock plans 795 - -
--------- -------- ---------
Balance at end of year $(66,209) $(67,004) $(61,092)
========= ========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
- 25 -
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
(In thousands)
- --------------
Year Ended December 31 1995 1994 1993
- ---------------------- ---- ---- ----
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $147,650 $120,346 $63,515
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 77,045 66,496 54,924
Restructuring provision, net of cash payments 16,136 - -
Provision for lottery contract dispute and litigation - - 48,438
Changes in assets and liabilities, excluding effects of acquisitions:
Accounts receivable, net (20,618) (28,018) (25,077)
Current liabilities, excluding debt (40,585) 23,972 16,324
Other current assets (22,479) (5,035) 1,847
Deferred income taxes 10,373 (15,725) (24,361)
Other long-term liabilities, excluding debt 450 569 445
Other assets (8,024) - -
-------- -------- --------
Net cash provided by operating activities 159,948 162,605 136,055
-------- -------- --------
Cash flows from investing activities:
Additions to property and equipment (31,687) (20,173) (39,757)
Additions to other assets, net (27,344) (12,163) (14,616)
Acquisitions, net of cash acquired (14,716) (144,528) (23,784)
Investments in unconsolidated affiliates (14,066) (15,303) -
Deferred payments on prior year acquisitions (8,743) - -
Proceeds from sale of businesses 14,868 - -
Proceeds from sale of land and buildings - 57,079 -
Change in short-term investments - - 3,357
-------- --------- --------
Net cash used by investing activities (81,688) (135,088) (74,800)
-------- --------- --------
Cash flows from financing activities:
Net short-term borrowings (payments) (44,274) 62,227 -
Additions to long-term debt 82,402 - 198,980
Payments on long-term debt (11,462) (2,375) (191,209)
Treasury stock purchases (132,668) (57,985) (26,983)
Dividends paid (50,223) (47,161) (42,041)
Proceeds from exercise of stock options 16,596 11,786 3,481
Other 7,034 3,855 -
--------- -------- --------
Net cash used by financing activities (132,595) (29,653) (57,772)
Effect of foreign currency exchange rates on cash 1,062 (4,059) (1,865)
--------- -------- --------
Net cash provided (used) (53,273) (6,195) 1,618
Cash and cash equivalents, beginning of year 79,409 85,604 83,986
--------- -------- --------
Cash and cash equivalents, end of year $26,136 $79,409 $85,604
======= ======= =======
</TABLE>
The accompanying notes are an integral part of these statements.
- 26 -
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING AND REPORTING POLICIES
PRINCIPLES OF CONSOLIDATION. The consolidated financial statements include the
accounts of the Company and its majority-owned subsidiaries. All significant
intercompany transactions and balances have been eliminated. Certain prior year
amounts have been reclassified to conform with the current year presentation.
NATURE OF OPERATIONS. The Company principally provides information services to
businesses that help them grant credit, authorize and process credit card and
check transactions, insure lives and property, and manage and control healthcare
costs. The principal lines of business are credit services, payment services,
insurance services and healthcare information services (see Note 11 for industry
segment information). The principal markets for credit and payment services are
retailers, banks and financial institutions, while those for insurance services
are life and health and property and casualty insurance companies. The principal
markets for healthcare information services are healthcare providers, payors,
and managed care organizations. The Company's operations are predominately
located within the United States.
USE OF ESTIMATES. The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions. These estimates and assumptions affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements as well as reported amounts of revenues and
expenses during the reporting period. Actual results could differ from these
estimates.
PROPERTY AND EQUIPMENT. The cost of property and equipment is depreciated
primarily on the straight-line basis over estimated asset lives of 30 to 50
years for buildings; useful lives, not to exceed lease terms, for leasehold
improvements; three to five years for data processing equipment and eight to 20
years for furniture.
GOODWILL. Goodwill is amortized on a straight-line basis primarily over 40
years. Amortization expense was $11,033,000 in 1995, $7,380,000 in 1994, and
$3,113,000 in 1993. As of December 31, 1995, and 1994, accumulated amortization
was $33,761,000 and $23,750,000, respectively. The Company regularly evaluates
whether events and circumstances have occurred that indicate the carrying amount
of goodwill may warrant revision or may not be recoverable. When factors
indicate that goodwill should be evaluated for possible impairment, the Company
uses an estimate of the future undiscounted net cash flows of the related
business over the remaining life of the goodwill in measuring whether the
goodwill is recoverable.
PURCHASED DATA FILES. Purchased data files are amortized on a straight-line
basis primarily over 15 years. Amortization expense was $11,029,000 in 1995,
$11,331,000 in 1994, and $9,674,000 in 1993. As of December 31, 1995, and 1994,
accumulated amortization was $63,528,000 and $52,293,000, respectively.
OTHER ASSETS. Other assets at December 31, 1995, and 1994, consist of the
following:
<TABLE>
<CAPTION>
(In thousands) 1995 1994
- ------------------------------------------------------------------
<S> <C> <C>
Purchased software $ 43,692 $ 39,355
Systems development and other deferred costs 42,826 41,149
Investments in unconsolidated affiliates 39,998 26,876
Other 44,256 36,618
-------- --------
</TABLE>
-27-
<PAGE>
<TABLE>
<S> <C>
$170,772 $143,998
======== ========
</TABLE>
Purchased software and systems development and other deferred costs are being
amortized on a straight-line basis over five to ten years. Amortization expense
for other assets was $22,390,000 in 1995, $18,138,000 in 1994, and $13,593,000
in 1993. As of December 31, 1995, and 1994, accumulated amortization was
$82,164,000 and $70,055,000, respectively.
FOREIGN CURRENCY TRANSLATION. The assets and liabilities of foreign
subsidiaries are translated at the year-end rate of exchange, and income
statement items are translated at the average rates prevailing during the year.
The resulting translation adjustment is recorded as a component of shareholders'
equity. Exchange gains and losses on intercompany balances of a long-term
investment nature are also recorded as a component of shareholders' equity.
Other foreign currency translation gains and losses, which are not material, are
recorded in the consolidated statements of income.
CONSOLIDATED STATEMENTS OF CASH FLOWS. The Company considers cash equivalents
to be short-term cash investments with original maturities of three months or
less.
Cash paid for income taxes and interest is as follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- -------------------------------------------------------------------
<S> <C> <C> <C>
Income taxes, net of amounts refunded $118,645 $91,643 $62,666
Interest $ 21,127 $14,604 $10,846
</TABLE>
In 1995, 1994 and 1993, the Company acquired various businesses that were
accounted for as purchases (Note 2). In conjunction with these transactions,
liabilities were assumed as follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- ---------------------------------------------------------------------------------
<S> <C> <C> <C>
Fair value of assets acquired $60,187 $330,898 $32,484
Cash paid for acquisitions 14,836 153,143 26,949
Value of treasury shares reissued for acquisitions - 77,235 -
Notes and deferred payments 13,369 16,974 400
------- -------- -------
Liabilities assumed $31,982 $ 83,546 $ 5,135
======= ======== =======
</TABLE>
FINANCIAL INSTRUMENTS. The Company's financial instruments consist primarily of
cash and cash equivalents, accounts and notes receivable, accounts payable and
short-term and long-term debt. The carrying amounts of these items, other than
long-term notes receivable and long-term debt, approximate their fair market
value due to their short maturity. As of December 31, 1995, the fair value of
the Company's long-term notes receivable (determined primarily by contractual
terms and market prices) was $18,538,000 compared to its carrying value of
$11,331,000. As of December 31, 1995, the fair value of the Company's long-term
debt (determined primarily by broker quotes) was $309,671,000 compared to its
carrying value of $304,666,000. During 1995, the Company did not hold any
derivative financial instruments.
ACCOUNTING STANDARDS CHANGE. In March 1995, the Financial Accounting Standards
Board issued Financial Accounting Standard No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of,"
which establishes accounting standards for the impairment of long-lived assets,
certain identifiable intangibles and goodwill related to those assets to be held
and used, as well as for long-lived assets and certain identifiable intangibles
to be disposed of. The Company will be required to adopt the new Standard in the
first quarter of 1996, and management does not expect its effect to be material
to the Company's consolidated financial position.
-28-
<PAGE>
2. ACQUISITIONS, DIVESTITURES, AND INVESTMENTS IN UNCONSOLIDATED AFFILIATES AND
NOTES RECEIVABLE
During 1995, 1994 and 1993, the Company acquired or made equity investments in
the following businesses:
<TABLE>
<CAPTION>
Date Industry Percentage
Business Acquired Segment Ownership
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
DICOM S.A. (Chile) December 1995 International 50.0%/(1)/
Tecnicob S.A. (France) July 1995 Payment Services 100.0%
The Infocheck Group Limited (U.K.) July 1995 International 100.0%
UCB Services, Inc. April 1995 Credit 100.0%
Medical Review Systems, L.P. March 1995 General 100.0%
Vallance and Associates, Inc. February 1995 Insurance 100.0%
Osborn Laboratories, Inc. November 1994 Insurance 100.0%
UAPT - Infolink plc (U.K.) October 1994 International 100.0%
Electronic Tabulating Service September 1994 General 100.0%
DICOM S.A. (Chile) August 1994 International 25.0%
Canadian Bonded Credits August 1994 International 100.0%
FBS Software (First Bankcard Systems, Inc.) July 1994 Payment Services 100.0%
First Security Processing Services July 1994 Payment Services 100.0%
Organizacion Veraz (Argentina) May 1994 International 33.3%
ASNEF - Equifax Servicios
de Informacion de Credito, S.L. (Spain) May 1994 International 49.0%
HealthChex May 1994 General 100.0%
Programming Resources Company April 1994 Insurance 100.0%
Transax plc (U.K.) April 1994 International 50.1%/(2)/
Charlotte Credit Bureau February 1994 Credit 100.0%
Cooperative Healthcare Networks January 1994 General 100.0%
Newbridge, Inc. Insurance Services October 1993 General 100.0%
Credit Bureau of Ocala Inc. September 1993 Credit 100.0%
Integratec, Inc. August 1993 Credit 100.0%
</TABLE>
/(1)/ Increased to 50.0% from the 25.0% ownership position acquired in 1994.
/(2)/ Increased to 50.1% from the 20.0% ownership position acquired in 1992.
The 1995 acquisitions of greater than 50% ownership were accounted for as
purchases, and had an aggregate purchase price of $28,205,000, with $33,147,000
allocated to goodwill and $11,337,000 to other assets (primarily purchased
software). Their results of operations have been included in the consolidated
statements of income from the dates of acquisition and were not material. They
were purchased using a combination of cash totaling $14,836,000 and notes
payable to sellers of $13,369,000. Additional consideration may be paid for
certain of the acquisitions based on their future operating performance.
During 1995, the Company increased its investment in DICOM S.A. from 25% to 50%
at a total cost of $11,502,000, and made investments in several other
unconsolidated affiliates totaling $2,564,000. These investments, accounted for
under the equity method, were purchased with cash and recorded as other assets.
-29-
<PAGE>
In 1995, the Company also invested $10 million to provide financing to Physician
Computer Network, Inc. (PCN), a national network of medical practice management
systems. The PCN financing is in the form of a five-year subordinated promissory
note, convertible into shares of PCN common stock at a conversion price of $5.20
per share (subject to certain conditions and adjustments). The note is recorded
in other assets. In conjunction with the financing, the Company entered into an
exclusive marketing agreement with PCN, whereby PCN will integrate certain of
the Company's healthcare services into its product line and promote the Company
as its exclusive claims clearinghouse for PCN customers.
During the third quarter of 1995, the Company sold its two market research
businesses in the General Information Services segment, Elrick & Lavidge and
Quick Test. Cash proceeds from these sales totaled $14,868,000 and resulted in
an immaterial gain, recorded in other income.
The 1994 acquisitions of greater than 50% ownership were accounted for as
purchases, and had an aggregate purchase price of $247,352,000, with
$212,765,000 allocated to goodwill, $19,987,000 to purchased data files, and
$37,883,000 to other assets (primarily purchased software). Their results of
operations have been included in the consolidated statements of income from the
dates of acquisition. They were purchased using a combination of cash totaling
$153,143,000, notes and deferred payments of $16,974,000, and the reissuance of
treasury shares with a market value of $77,235,000. Additional consideration
may be paid for certain of the acquisitions based on their future operating
performance. During 1995, additional consideration of $1,633,000 was paid by the
reissuance of treasury shares for guarantees made by the Company related to the
value to be realized by certain sellers upon their disposition of treasury
shares received in 1994.
The 1994 acquisitions of less than 50% ownership were accounted for under the
equity method and had an aggregate purchase price of $15,303,000. They were
purchased with cash and recorded as other assets.
The 1993 acquisitions, which were accounted for as purchases, had an aggregate
purchase price of $27,349,000, of which $14,002,000 was allocated to goodwill
and $5,007,000 to purchased data files. Their results of operations have been
included in the consolidated statements of income from the dates of acquisition
and were not material to the results of operations of the Company.
3. LOTTERY CONTRACT DISPUTE, LITIGATION, AND SETTLEMENT
High Integrity Systems, Inc. (HISI), a Company subsidiary, entered into a
contract in July 1992 to provide lottery services to the state of California,
whereby HISI agreed to provide a system to automate the processing of instant
lottery tickets and a system to sell on-line game tickets through 10,000 low-
volume terminals.
On April 26, 1993, the California State Lottery (CSL) filed suit against HISI in
Superior Court, Sacramento County, California, with said complaint amended May
7,1993 naming Equifax Inc., et al. and Federal Insurance Company as additional
defendants. The CSL sought unspecified damages for alleged breach of contract
and injunctive relief. On May 7, 1993, HISI filed a cross-complaint against the
CSL seeking compensatory and general damages in an amount not less than $65
million and special and consequential damages in an amount not less than $100
million alleging breach of contract and seeking recovery of the reasonable value
of the labor and materials expended on behalf of the CSL based on the theory of
quantum meruit and unjust enrichment.
In September 1993, the Company recorded a provision of $48,438,000 ($30,939,000
after tax, or $.21 per
-30-
<PAGE>
share) related to the lottery contract to write down data processing equipment
and other assets to their estimated net realizable value and to accrue for
estimated costs related to litigation with the CSL.
On July 14, 1995, the CSL and HISI jointly announced a renewed business
agreement which allowed the litigation between the parties to be settled pending
execution of the terms of the contract. On November 9, 1995, the CSL and HISI
finalized the terms of the reinstated contract. The final settlement was
approved by the trial court on December 19, 1995, and provides that the CSL and
HISI shall file dismissals with prejudice of their respective claims no later
than 365 days following the trial court's approval.
The settlement provides for a reinstated contract whereby HISI will install its
system to automate the processing of instant lottery tickets, with the CSL
purchasing 6,700 terminals, related security hardware and licensing various
software applications developed to support the system from HISI for $25,000,000.
In the fourth quarter of 1995, the Company recorded a credit of $19,665,000
($11,996,000 after tax, or $.08 per share) to reflect the financial impact of
this settlement net of related legal expenses and additional costs to be
incurred by the Company to complete the system software and install the
terminals. Under the reinstated contract, HISI will initially install a minimum
of 6,000 terminals with HISI retaining an option to install up to 4,000
additional terminal locations, with CSL approval. HISI is also guaranteed to
receive 66 months of revenue for each of the 6,000 terminals at the rate of 5%
on each dollar of lottery ticket sales occurring from each terminal. If HISI
completes the system and acceptance testing within specified dates, an incentive
payment of up to $4,000,000 may be earned. HISI and the CSL have established an
oversight committee and engaged an independent technical advisor who will
consult in the design and implementation of acceptance testing and start-up
activities.
On February 6, 1996, HISI and GTECH Corporation (GTECH) entered into an
agreement whereby HISI subcontracted many of its obligations under the
reinstated contract to GTECH. This subcontract provides for a one-time payment
of $58,000,000 by GTECH to HISI, and also provides that future payments received
by HISI from the CSL for lottery ticket sales and incentives earned be paid to
GTECH. The $58,000,000 received by HISI will be recognized as revenue over the
term of the reinstated CSL contract, net of related expenses.
4. LONG-TERM DEBT AND SHORT-TERM BORROWINGS
Long-term debt at December 31, 1995 and 1994 is as follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
Senior Notes, 6.5%, due 2003, net of unamortized
discount of $765 in 1995 and $867 in 1994 $199,235 $199,133
Term loan, varying interest rate, 6.1% at December 31,1995, due 1997 50,000 -
Term loan, denominated in Pounds Sterling, varying interest rate, 7.01% at
December 31, 1995, due 2000 31,890 -
Other 23,541 14,994
-------- --------
304,666 214,127
Less current maturities 2,001 2,160
-------- --------
$302,665 $211,967
======== ========
</TABLE>
The Company has available a committed $550 million revolving credit facility
with a group of commercial banks that expires August 2000. The agreement
provides interest rate options tied to Base Rate, LIBOR,
-31-
<PAGE>
or Money Market indexes, and contains certain financial covenants related to
fixed charge coverage, funded debt to cash flow and limitations on subsidiary
indebtedness. Scheduled maturities of long-term debt during the five years
subsequent to December 31, 1995, are as follows: $2,001,000 in 1996, $57,361,000
in 1997, $886,000 in 1998, zero in 1999, and $44,935,000 in 2000.
Short-term borrowings at December 31, 1995, consist of $18,383,000 in notes
payable to banks, and have a weighted average interest rate of 6.72%. These
notes are primarily denominated in Pounds Sterling.
5. INCOME TAXES
The Company records deferred income taxes using enacted tax laws and rates for
the years in which the taxes are expected to be paid. Deferred income tax
assets and liabilities are recorded based on the differences between the
financial reporting and income tax bases of assets and liabilities.
The provision for income taxes consists of the following:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Current:
Federal $ 69,274 $ 75,736 $ 54,373
State 14,548 13,904 9,193
Foreign 7,914 10,713 9,670
-------- -------- --------
91,736 100,353 73,236
======== ======== ========
Deferred:
Federal 8,161 (10,774) (22,935)
State 1,163 (1,437) (1,920)
Foreign 528 (1,011) 100
-------- -------- --------
9,852 (13,222) (24,755)
-------- -------- --------
Total $101,588 $ 87,131 $ 48,481
======== ======== ========
</TABLE>
The provision for income taxes is based upon income before income taxes as
follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
United States $232,871 $191,332 $ 92,593
Foreign 16,367 16,145 19,403
-------- -------- --------
$249,238 $207,477 $111,996
======== ======== ========
</TABLE>
The provision for income taxes is reconciled with the federal statutory rate as
follows:
<TABLE>
<CAPTION>
(Dollars in thousands) 1995 1994 1993
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Federal statutory rate 35.0% 35.0% 35.0%
======== ======== ========
Provision computed at federal statutory rate $ 87,233 $ 72,617 $ 39,199
State and local taxes, net of federal tax benefit 10,212 8,104 4,728
Other 4,143 6,410 4,554
-------- -------- --------
$101,588 $ 87,131 $ 48,481
======== ======== ========
</TABLE>
-32-
<PAGE>
Components of the Company's deferred income tax assets and liabilities at
December 31, 1995 and 1994 are as follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994
- -------------------------------------------------------------------------------
<S> <C> <C>
Deferred income tax assets:
Postretirement benefits $ 32,868 $ 34,082
Reserves and accrued expenses 33,420 30,850
Provision for lottery contract dispute and litigation 1,210 17,499
Employee compensation programs 15,561 10,737
Other 10,547 8,615
-------- --------
93,606 101,783
-------- --------
Deferred income tax liabilities:
Data files and other assets (41,300) (48,062)
Depreciation (4,401) (5,034)
Pension expense (7,128) (4,216)
Safe harbor lease agreements (3,557) (4,602)
Other (11,419) (11,156)
-------- --------
(67,805) (73,070)
-------- --------
Net deferred income tax asset $ 25,801 $ 28,713
======== ========
</TABLE>
The Company's deferred income tax assets and liabilities at December 31, 1995
and 1994 are included in the balance sheet as follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994
- -------------------------------------------------------------------------------
<S> <C> <C>
Deferred income tax assets $30,594 $26,472
Other assets 4,454 9,286
Other long-term liabilities (9,247) (7,045)
------- -------
Net deferred income tax asset $25,801 $28,713
======= =======
</TABLE>
Accumulated undistributed retained earnings of Canadian subsidiaries amounted to
approximately $100,334,000 at December 31, 1995. No provision for Canadian
withholding taxes or United States federal income taxes is made on foreign
earnings because they are considered by management to be permanently invested in
those subsidiaries and, under the tax laws, are not subject to such taxes until
distributed as dividends. If the earnings were not considered permanently
invested, approximately $10,033,000 of deferred income taxes would have been
provided. Such taxes, if ultimately paid, may be recoverable as foreign tax
credits in the United States.
6. SHAREHOLDERS' EQUITY
STOCK SPLIT AND RIGHTS PLAN. In October 1995, the Company's Board of Directors
approved a two-for-one stock split payable December 15, 1995, to shareholders of
record on November 24, 1995. Accordingly, all share and per share data have been
restated to give effect to this split.
Also in October 1995, the Company's Board of Directors adopted a Shareholder
Rights Plan (Rights Plan). The Rights Plan contains provisions to protect the
Company's shareholders in the event of an unsolicited offer to acquire the
Company, including offers that do not treat all shareholders equally, the
acquisition in the open market of shares constituting control without offering
fair value to all shareholders, and other coercive, unfair or inadequate
takeover bids and practices that could impair the ability of the Board of
-33-
<PAGE>
Directors to represent shareholders' interests fully. Pursuant to the Rights
Plan, the Board of Directors declared a dividend of one Share Purchase Right (a
Right) for each outstanding share of the Company's common stock, with
distribution to be made to shareholders of record as of November 24, 1995. The
Rights, which will expire in November 2005, initially will be represented by,
and trade together with, the Company's common stock. The Rights are not
currently exercisable and do not become exercisable unless certain triggering
events occur. Among the triggering events is the acquisition of 20% or more of
the Company's common stock by a person or group of affiliated or associated
persons. Unless previously redeemed, upon the occurrence of one of the specified
triggering events, each Right that is not held by the 20% or more shareholder
will entitle its holder to purchase one share of common stock or, under certain
circumstances, additional shares of common stock at a discounted price.
TREASURY SHARES. During 1995, 1994, and 1993, the Company repurchased
6,847,000, 4,780,000, and 2,519,000 of its own common shares through open market
transactions at an aggregate cost of $132,668,000, $57,985,000, and $26,983,000,
respectively. During 1995, the Company's Board of Directors authorized an
additional $250,000,000 in share repurchases, and at December 31, 1995,
approximately $157,000,000 remained available for future purchases. During 1994,
the Company reissued 5,417,000 treasury shares in connection with four
acquisitions (Note 2).
In April 1993, the Company established the Equifax Inc. Employee Stock Benefits
Trust to fund various employee benefit plans and compensation programs. In
November 1993, the Company transferred 6,200,000 treasury shares to the Trust.
During the first quarter of 1994, the Company transferred 600,000 treasury
shares to another employee benefits trust. Shares held by the trusts are not
considered outstanding for earnings per share calculations until released to the
employee benefit plans or programs. During 1995, 80,720 shares were transferred
from the Employee Stock Benefits Trust and used for stock option exercises and
restricted share grants.
STOCK OPTIONS. The Company's shareholders have approved several stock option
plans which provide that qualified and nonqualified options may be granted to
officers and employees at exercise prices not less than market value on the date
of grant. Grants in 1995 and 1993 include 2,913,000 and 2,123,000 options
awarded under programs which included essentially all full-time salaried
employees. Options are generally exercisable for five to ten years from grant
date, subject to any vesting provisions. Certain of the plans also provide for
awards of restricted shares of the Company's common stock.
A summary of changes in outstanding options is as follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Balance, beginning of year 5,874 6,270 3,610
Granted 4,799 1,376 3,702
Canceled (848) (354) (552)
Exercised (1,838) (1,418) (490)
-------- -------- --------
Balance, end of year 7,987 5,874 6,270
======== ======== ========
Exercisable at end of year 2,561 2,670 1,522
======== ======== ========
</TABLE>
Other information related to stock options is as follows:
<TABLE>
<CAPTION>
1995 1994 1993
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Price range of outstanding options $5.74-$18.94 $4.93-$15.00 $4.93-$12.32
Price range of exercised options $4.93-$15.00 $5.74-$12.32 $ 5.72-$9.94
Average exercise price $ 10.06 $ 9.25 $ 8.29
</TABLE>
-34-
<PAGE>
Stock options outstanding at December 31, 1995, expire at various dates through
2005. At December 31, 1995, there were 6,626,000 shares available for future
option grants and restricted stock awards. In January 1996, 1,971,000 shares
were granted with exercise prices ranging from $18.63 to $27.94.
PERFORMANCE SHARE PLAN. The Company has a performance share plan for certain
key officers which provides for distribution of the Company's common stock at
the end of three-year measurement periods based upon the growth in earnings per
share and certain other criteria. Recipients may elect to receive up to 50
percent of their distribution in cash. The total expense under the plan was
$9,870,000 in 1995, $3,987,000 in 1994, and $5,732,000 in 1993. At December 31,
1995, 943,130 shares of common stock were available for future awards under the
plan.
7. EMPLOYEE BENEFITS
The Company and its subsidiaries have non-contributory qualified retirement
plans covering most salaried employees, including certain employees in Canada.
Under the plans, retirement benefits are primarily a function of years of
service and the level of compensation during the final years of employment.
Total pension expense for all qualified plans was $7,275,000 in 1995, $7,143,000
in 1994 and $7,833,000 in 1993.
U.S. RETIREMENT PLAN. The following table sets forth the U.S. plan's funded
status at December 31, 1995, and 1994:
<TABLE>
<CAPTION>
(In thousands) 1995 1994
- -----------------------------------------------------------------------------------------
<S> <C> <C>
Accumulated plan benefits:
Vested benefits $320,784 $281,468
Nonvested benefits 10,286 11,302
-------- --------
331,070 292,770
Effect of projected future compensation levels 41,680 21,249
-------- --------
Projected benefit obligation 372,750 314,019
Plan assets at fair value 332,726 285,312
-------- --------
Projected benefit obligation in excess of plan assets (40,024) (28,707)
Unrecognized net losses 38,610 20,233
Prior service cost not yet recognized in period pension cost 6,488 8,125
Net asset at transition being amortized through 1996 (528) (994)
Adjustment to recognize minimum liability - (6,115)
-------- --------
Prepaid (accrued) pension cost $ 4,546 $ (7,458)
======== ========
</TABLE>
The plan's assets consist primarily of listed common stocks and fixed income
obligations. At December 31, 1995, the plan's assets included 824,972 shares of
the Company's common stock with a market value of approximately $17,634,000.
Pension expense for the plan includes the following components:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Service cost $ 5,627 $ 7,694 $ 6,048
Interest cost on projected benefit obligation 26,805 24,058 24,096
Actual return on plan assets (58,539) (2,064) (36,863)
Net amortization and deferrals 32,995 (23,168) 14,235
-------- -------- --------
</TABLE>
-35-
<PAGE>
<TABLE>
<S> <C> <C> <C>
Pension expense $ 6,888 $ 6,520 $ 7,516
======== ======== ========
</TABLE>
Assumptions used in the accounting for the U.S. Retirement Plan are as follows:
<TABLE>
<CAPTION>
1995 1994 1993
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
Discount rate used to determine projected
benefit obligation at December 31 7.25% 8.75% 7.5%
Rate of increase in future compensation levels 4.25% 5.0% 5.0%
Expected long-term rate of return on plan assets 9.5% 9.0% 9.0%
</TABLE>
CANADIAN RETIREMENT PLAN. The Company's Canadian subsidiaries also have a
retirement plan that covers approximately 800 employees. The plan's assets
consist primarily of fixed income obligations and equity securities, and their
aggregate fair market value approximates the projected benefit obligation at
December 31, 1995.
SUPPLEMENTAL RETIREMENT PLAN. The Company maintains a supplemental executive
retirement program for certain key employees. The plan, which is unfunded,
provides supplemental retirement payments based on salary and years of service.
The expense for this plan was $2,982,000 in 1995, $2,609,000 in 1994, and
$2,205,000 in 1993. The accrued liability for this plan at December 31, 1995 and
1994, was $20,926,000 and $16,270,000, respectively, and is included in other
long-term liabilities in the accompanying balance sheets.
EMPLOYEE THRIFT PLAN. The Company's thrift plan provides for annual
contributions, within specified ranges, determined at the discretion of the
Board of Directors for the benefit of eligible employees in the form of cash or
shares of the Company's common stock. Expense for this plan was $4,454,000 in
1995, $4,739,000 in 1994 and $4,286,000 in 1993.
POSTRETIREMENT BENEFITS. The Company provides certain healthcare and life
insurance benefits for eligible retired employees. Healthcare benefits are
provided through a trust, while life insurance benefits are provided through an
insurance company. Substantially all of the Company's U.S. employees may become
eligible for these benefits if they reach normal retirement age while working
for the Company and satisfy certain years of service requirements. The Company
accrues the cost of providing postretirement benefits for medical and life
insurance coverage over the active service period of the employee.
The following table presents a reconciliation of the plan's status at December
31, 1995, and 1994:
<TABLE>
<CAPTION>
(In thousands) 1995 1994
- -------------------------------------------------------------------------------
<S> <C> <C>
Accumulated postretirement benefit obligation:
Retirees $ 71,581 $ 63,349
Fully eligible active plan participants 9,730 6,467
Other active participants 10,340 6,856
--------- ---------
91,651 76,672
Plan assets at fair value - -
--------- ---------
Accumulated benefit obligation in excess of plan assets (91,651) (76,672)
Unrecognized prior service credit due to plan amendments (10,103) (13,417)
Unrecognized net losses 17,462 3,994
--------- ---------
(84,292) (86,095)
Less: Current portion (3,407) (3,066)
--------- ---------
Accrued postretirement benefit obligation $(80,885) $(83,029)
========= =========
</TABLE>
-36-
<PAGE>
Net periodic postretirement benefit expense includes the following components:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Service cost $ 2,079 $ 2,264 $ 1,770
Interest cost on accumulated benefit obligation 6,439 5,908 5,724
Amortization of prior service credit (3,315) (3,839) (4,337)
Amortization of losses - 656 -
------- ------- -------
Net periodic postretirement benefit expense $ 5,203 $ 4,989 $ 3,157
======= ======= =======
</TABLE>
Assumptions used in the computation of postretirement benefit expense and the
related obligation are as follows:
<TABLE>
<CAPTION>
1995 1994 1993
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Discount rate used to determine accumulated
postretirement benefit obligation at December 31 7.25% 8.75% 7.5%
Initial healthcare cost trend rate 11.0% 11.0% 11.0%
Ultimate healthcare cost trend rate 6.0% 6.0% 6.0%
Year ultimate healthcare cost trend rate reached 2005 2005 2005
</TABLE>
If the healthcare cost trend rate were increased 1% for all future years, the
accumulated postretirement benefit obligation as of December 31, 1995, would
have increased 6.2 percent. The effect of such a change on the aggregate of
service and interest cost for 1995 would have been an increase of 7.3 percent.
The Company continues to evaluate ways in which it can better manage these
benefits and control their costs. Any changes in the plan, revisions to
assumptions, or changes in the Medicare program that affect the amount of
expected future benefits may have a significant effect on the amount of the
reported obligation and future annual expense.
8. COMMITMENTS AND CONTINGENCIES
LEASES. The Company's operating leases involve principally office space and
office equipment. Rental expense relating to these leases was $46,898,000 in
1995, $46,534,000 in 1994 and $40,798,000 in 1993. In March 1994, the Company
sold and leased back under operating leases certain land and buildings. The net
sales price of $55.1 million approximated the net book value of the related
assets.
Future minimum payment obligations for noncancelable operating leases exceeding
one year are as follows as of December 31, 1995:
<TABLE>
<CAPTION>
(In thousands) Amount
- --------------------------------------------------------
<S> <C>
1996 $ 38,201
1997 32,312
1998 27,260
1999 21,315
2000 18,697
Thereafter 95,248
--------
$233,033
========
</TABLE>
-37-
<PAGE>
AGREEMENT WITH COMPUTER SCIENCES CORPORATION. The Company has an agreement with
Computer Sciences Corporation (CSC) under which CSC-owned credit bureaus and
certain CSC affiliate bureaus utilize the Company's credit database service.
CSC and these affiliates retain ownership of their respective credit files and
the revenues generated by their credit reporting activity. The Company receives
a processing fee for maintaining the database and for each report supplied. The
agreement expires in 1998, is renewable at the option of CSC for successive ten-
year periods, and provides CSC with an option to sell its collection and credit
reporting businesses to the Company. The option is currently exercisable and
expires in 2013. In the event CSC does not exercise its option to sell and does
not renew the agreement, or if there is a change in control of CSC, the Company
has the option to purchase CSC's collection and credit reporting businesses.
The option price is determined, for all purposes, in accordance with the
following schedule: on or before July 31,1998, at a price determined by certain
financial formulas (currently estimated at approximately $400 million); and
after July 31, 1998, at appraised value.
DATA PROCESSING SERVICES AGREEMENT. In April 1993, the Company outsourced a
portion of its computer data processing operations and related functions to
Integrated Systems Solutions Corporation (ISSC), a subsidiary of IBM. Under the
terms of the agreement, the Company will pay ISSC an estimated $650 million over
the ten-year term of the agreement, although this amount could be more or less
depending upon various factors such as the inflation rate, the introduction of
significant new technologies or changes in the Company's data processing needs
as a result of acquisitions or divestitures. Under certain circumstances (e.g.,
a change in control of the Company), the Company may cancel the ISSC agreement;
however, the agreement provides that the Company must pay a significant penalty
in the event of such a cancellation.
EMPLOYMENT AGREEMENTS. The Company has employment agreements with eight of its
officers which provide certain severance pay and benefits in the event of a
"change in control" of the Company, which is defined as the acquisition of more
than 50% of the Company's outstanding common stock by an entity or a concerted
group of entities. In the event of a "change in control," the Company's
performance share plan provides that all shares designated for future
distribution will become fully vested and payable, subject to the achievement of
certain levels of growth in earnings per share. At December 31, 1995, the
maximum contingent liability under the agreements and plan was approximately
$20,461,000.
LITIGATION. A number of lawsuits seeking damages are brought against the
Company each year, largely as a result of reports issued by the Company. The
Company provides for estimated legal fees and settlements relating to pending
lawsuits. In the opinion of management, the ultimate resolution of these
matters will not have a materially adverse effect on the Company's financial
position, liquidity or results of operations.
9. RESTRUCTURING
In the fourth quarter of 1995, the Company initiated a restructuring program
designed to streamline operations by reducing staffing levels and consolidating
facilities (see Note 11 for industry segment information). The total cost of
this program was $19,572,000 ($11,939,000 net of tax, or $.08 per share).
Components of the restructuring provision and utilization through December 31,
1995, are as follows:
<TABLE>
<CAPTION>
(Dollars in thousands) Original Provision Utilized Remaining Reserve
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Severance and termination benefits for
approximately 750 employees 13,813 $2,521 $11,292
Asset write-offs 2,994 2,994 -
</TABLE>
-38-
<PAGE>
<TABLE>
<S> <C> <C> <C>
Lease costs 2,765 915 1,850
------- ------ -------
$19,572 $6,430 $13,142
======= ====== =======
</TABLE>
The reserve balance at December 31, 1995, is included in other current
liabilities in the accompanying balance sheets.
10. QUARTERLY FINANCIAL DATA (UNAUDITED)
Quarterly operating revenue and operating income by industry segment and other
summarized quarterly financial data for 1995 and 1994 are as follows (in
thousands, except per share amounts; see Note 11 regarding restatement):
<TABLE>
<CAPTION>
1995: First Second Third Fourth
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue:
Credit Services $119,320 $125,682 $129,836 $137,885
Payment Services 60,878 68,831 72,645 82,028
Insurance Services 127,099 132,439 130,362 127,046
International Operations 48,932 50,199 55,532 56,381
General Information Services 27,964 30,255 23,652 15,992
-------- -------- -------- --------
$384,193 $407,406 $412,027 $419,332
======== ======== ======== ========
Operating income (loss): *
Credit Services $ 40,615 $ 42,123 $ 45,069 $ 49,057
Payment Services 11,003 15,660 16,090 20,707
Insurance Services 9,558 11,141 11,353 2,669
International Operations 2,280 4,507 7,939 5,233
General Information Services (1,481) (2,275) (3,560) 10,828
-------- -------- -------- --------
Operating Contribution 61,975 71,156 76,891 88,494
General Corporate Expense (8,740) (7,638) (10,791) (8,408)
-------- -------- -------- --------
$ 53,235 $ 63,518 $ 66,100 $ 80,086
======== ======== ======== ========
Income before income taxes $ 50,492 $ 60,586 $ 62,935 $ 75,225
======== ======== ======== ========
Net income $ 29,472 $ 35,814 $ 37,981 $ 44,383
======== ======== ======== ========
Net income per common share $0.19 $0.23 $0.25 $0.30
======== ======== ======== ========
</TABLE>
*See Industry Segment Information (Note 11) regarding the effects of
restructuring provision and lottery settlement on fourth quarter 1995 operating
income.
<TABLE>
<CAPTION>
1994: First Second Third Fourth
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue:
Credit Services $116,339 $115,314 $119,625 $125,119
Payment Services 50,557 56,184 62,599 77,257
Insurance Services 106,978 114,142 113,603 118,686
International Operations 22,458 32,736 37,563 50,614
General Information Services 23,027 24,311 25,897 28,987
-------- -------- -------- --------
$319,359 $342,687 $359,287 $400,663
======== ======== ======== ========
Operating income (loss):
Credit Services $ 36,348 $ 34,773 $ 39,434 $ 39,312
Payment Services 9,844 13,631 13,913 20,072
Insurance Services 3,517 6,068 5,569 3,350
</TABLE>
-39-
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
International Operations 3,349 5,362 4,169 3,578
General Information Services (903) (1,100) (866) 3,893
-------- -------- -------- --------
Operating Contribution 52,155 58,734 62,219 70,205
General Corporate Expense (8,214) (7,865) (6,640) (6,487)
-------- -------- -------- --------
$ 43,941 $ 50,869 $ 55,579 $ 63,718
======== ======== ======== ========
Income before income taxes $ 41,541 $ 49,088 $ 53,724 $ 63,124
======== ======== ======== ========
Net income $ 24,302 $ 28,716 $ 30,956 $ 36,372
======== ======== ======== ========
Net income per common share $0.16 $0.20 $0.21 $0.24
======== ======== ======== ========
</TABLE>
11. INDUSTRY SEGMENT INFORMATION
In the fourth quarter of 1995, the Company changed its segment reporting
structure by moving its National Decision Systems business unit from the General
Information Services segment to the Credit Services segment. Prior year
information has been restated to conform with the 1995 presentation.
<TABLE>
<CAPTION>
1995 1994 1993
(Dollars in thousands) Amount % of Total Amount % of Total Amount % of Total
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operating revenue:
Credit Services $ 512,723 32 $ 476,39 34% $ 427,777 35%
Payment Services 284,382 17 246,597 17 210,416 17
Insurance Services 516,946 32 453,409 32 396,519 33
International Operations 211,044 13 143,371 10 97,296 8
General Information Services 97,863 6 102,222 7 85,209 7
---------- ---- ---------- ---- ---------- ----
$1,622,958 100% $1,421,996 100% $1,217,217 100%
========== ==== ========== ==== ========== ====
Operating income (loss):
Credit Services $ 176,864 59% $ 149,867 61% $ 133,004 89%
Payment Services 63,460 21 57,460 24 51,910 35
Insurance Services 34,721 12 18,504 8 5,537 4
International Operations 19,959 7 16,458 7 18,056 12
General Information Services 3,512 1 1,024 - (59,916)* (40)
---------- ---- ---------- ---- ---------- ----
Operating Contribution 298,516 100% 243,313 100% 148,591 100%
==== ==== ====
General Corporate Expense (35,577) (29,206) (29,562)
---------- ----------
$ 262,939 $ 214,107 $ 119,029
========== ========== ==========
Identifiable assets at
December 31:
Credit Services $ 298,095 28% $ 293,947 29% $ 302,983 41%
Payment Services 122,925 12 115,929 11 70,806 10
Insurance Services 171,499 16 171,904 17 83,390 11
International Operations 307,864 29 293,318 29 128,027 18
General Information Services 82,874 8 84,352 8 42,833 6
Corporate 70,438 7 61,724 6 103,162 14
---------- ---- ---------- ---- ---------- ----
$1,053,695 100% $1,021,174 100% $ 731,201 100%
========== ==== ========== ==== ========== ====
</TABLE>
*Includes a provision for lottery contract dispute and litigation of $48,438
(Note 3).
Description of Segments:
CREDIT SERVICES: Consumer credit reporting information; credit card marketing
services; risk management and collection services; locate services; fraud
detection and prevention services; mortgage loan origination information; and
PC-based marketing systems, geodemographic systems and mapping tools.
-40-
<PAGE>
PAYMENT SERVICES: Check guarantee and verification services; credit and debit
card authorization and processing; credit card marketing enhancement; and
software products for managing credit card operations.
INSURANCE SERVICES: Underwriting and claims reporting services; inspection and
loss control services; workers' compensation audits, software for commercial
insurers; specimen testing for life and health insurance applicants; and
employment evaluation services.
INTERNATIONAL OPERATIONS: In Canada, consumer and business credit reporting
information; accounts receivable and collection services; underwriting services
for property and casuality insurance companies; and check guarantee services. In
Europe (primarily the United Kingdom), credit reporting and marketing services;
credit scoring and modeling services; check guarantee services; and auto lien
information. In South America, credit information services and commercial,
financial and medical information.
GENERAL INFORMATION SERVICES: Healthcare Information Services includes
electronic claims processing; physician profiling; claims auditing; claims
analysis, administration and utilization management; electronic remittance;
hospital bill audits; and medical credentials verification. Marketing Services,
through August 1995, included research and analysis; and custom opinion surveys.
Notes to Industry Segment Information:
(1) Operating revenue is to unaffiliated customers only.
(2) Operating income is operating revenue less operating costs and expenses,
excluding interest expense, other income and income taxes.
(3) Depreciation and amortization by industry segment are as follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- --------------------------------------------------------------------------
<S> <C> <C> <C>
Credit Services $26,624 $29,412 $28,563
Payment Services 7,000 4,970 3,230
Insurance Services 13,514 10,680 8,077
International Operations 16,844 10,986 5,583
General Information Services 9,361 6,990 3,971
Corporate 3,702 3,458 5,500
------- ------- -------
$77,045 $66,496 $54,924
======= ======= =======
</TABLE>
(4) Capital expenditures by industry segment, excluding property and equipment
and other assets acquired in acquisitions, are as follows:
<TABLE>
<CAPTION>
(In thousands) 1995 1994 1993
- --------------------------------------------------------------------------
<S> <C> <C> <C>
Credit Services $ 8,225 $ 7,251 $12,864
Payment Services 12,719 9,422 3,735
Insurance Services 9,487 5,734 7,311
International Operations 4,125 5,306 5,341
General Information Services 16,800* 3,277 24,630
Corporate 7,675 1,346 492
------- ------- -------
$59,031 $32,336 $54,373
======= ======= =======
</TABLE>
*Includes $10 million investment for PCN financing (Note 2).
(5) In the fourth quarter of 1995, the Company recorded a restructuring
provision (Note 9) and a settlement with the California State Lottery (Note 3).
Operating income by industry segment
-41-
<PAGE>
decreased (increased) as a result of these items as follows:
<TABLE>
<CAPTION>
(In thousands) Restructuring Provision Lottery Settlement Total
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Credit Services $ 3,243 $ - $ 3,243
Payment Services 521 - 521
Insurance Services 9,150 - 9,150
International Operations 1,716 - 1,716
General Information Services 4,442 (19,665) (15,223)
Corporate 500 - 500
---------- ---------- --------
$ 19,572 $ (19,665) $ (93)
========== ========== ========
</TABLE>
(6) Financial information by geographic area is as follows:
<TABLE>
<CAPTION>
1995 1994 1993
(Dollars in thousands) Amount % of Total Amount % of Total Amount % of Total
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operating revenue:
United States $1,405,560 87% $1,277,196 90% $1,119,921 92%
Canada 78,952 5 78,277 5 76,285 6
Europe 138,446 8 66,523 5 21,011 2
---------- ---- ---------- ---- ---------- ----
$1,622,958 100% $1,421,996 100% $1,217,217 100%
========== ==== ========== ==== ========== ====
Operating contribution (loss):
United States $ 277,070 93% $ 228,280 94% $ 130,995 88%
Canada 15,065 5 15,476 6 19,169 13
Europe 5,389 2 (851) - (1,573) (1)
South America 992 - 408 - - -
---------- ---- ---------- ---- ---------- ----
$ 298,516 100% $ 243,313 100% $ 148,591 100%
========== ==== ========== ==== ========== ====
Identifiable assets at December 31:
United States $ 737,575 70% $ 723,466 71% $ 603,174 83%
Canada 70,984 7 109,004 11 102,559 14
Europe 217,903 21 173,054 17 25,468 3
South America 27,233 2 15,650 1 - -
---------- ---- ---------- ---- ---------- ----
$1,053,695 100% $1,021,174 100% $ 731,201 100%
========== ==== ========== ==== ========== ====
</TABLE>
-42-
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders of Equifax Inc.:
We have audited the accompanying consolidated balance sheets of Equifax Inc. (a
Georgia corporation) and subsidiaries as of December 31, 1995 and 1994 and the
related consolidated statements of income, shareholders' equity and cash flows
for each of the three years in the period ended December 31, 1995. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Equifax Inc. and subsidiaries
as of December 31, 1995 and 1994 and the results of their operations and their
cash flows for each of the three years in the period ended December 31, 1995, in
conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
February 16, 1996
-43-
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
- ------- -------------------------------------------------
ACCOUNTING AND FINANCIAL DISCLOSURE
-----------------------------------
None.
PART III
--------
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
- -------- --------------------------------------------------
The Company's Proxy Statement for the Annual Meeting of Shareholders to be
held on May 1, 1996, contains, on pages 2 through 4 and 12 thereof,
information relating to the Company's Officers, Directors and persons nominated
to become Directors. Said information is incorporated herein by reference and
made a part hereof. See also information concerning the Company's executive
officers in Part I, above.
ITEM 11. EXECUTIVE COMPENSATION
- -------- ----------------------
The Company's Proxy Statement for the Annual Meeting of Shareholders to be
held on May 1, 1996, contains, on pages 8 through 17 thereof, information
relating to executive compensation. Said information is incorporated herein by
reference and made a part hereof.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
- -------- -----------------------------------------------
AND MANAGEMENT
--------------
The Company's Proxy Statement for the Annual Meeting of Shareholders to be
held on May 1, 1996, contains, on pages 6 and 7, information relating to
security ownership of certain beneficial owners and management. Said
information is incorporated herein by reference and made a part hereof.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- -------- ----------------------------------------------
The Company's Proxy Statement for the Annual Meeting of Shareholders to be
held on May 1, 1996, contains, on pages 4 and 5 thereof, information relating
to certain relationships and related transactions. Said information is
incorporated herein by reference and made a part hereof.
PART IV.
--------
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
- -------- ---------------------------------------------------
ON FORM 8-K
-----------
The following documents are filed as part of this report:
(A)1. FINANCIAL STATEMENTS
[S] [C]
. Consolidated Balance Sheets - December 31, 1995 and 1994
-44-
<PAGE>
. Consoldiated Statements of Income for the Years Ended December 31,
1995, 1994 and 1993
. Consolidated Statements of Shareholders' Equity for the Years Ended
December 31, 1995, 1994 and 1993
. Consolidated Statements of Cash Flows for the Years Ended December 31,
1995, 1994 and 1993
. Notes to Consolidated Financial Statements
(A)2. FINANCIAL STATEMENT SCHEDULES
All schedules have been omitted because they are not applicable or
the required information is included in the consolidated financial
statements or notes thereto.
(A)3. EXHIBITS
Articles of Incorporation and By-laws
. Articles of Incorporation (72 pages) (P-Filed under Form SE)
. By-Laws (13 pages)
Instruments Defining the Rights of Security Holders, Including
Indentures
. Loan Agreement (132 pages)
. Portion of Prospectus and Trust Indenture (134 pages)/(1)/
Material Contracts and Compensation Plans
. Equifax Inc. 1988 Performance Share Plan for Officers, as amended (14
pages)/(5)(6)/
. Equifax Inc. Incentive Compensation Plan (5 pages)/(6)/
. Deferred Compensation Plan (22 pages)/(6)/
. Change in Control Agreement (10 pages)/(4)(6)/
. Executive Employment Agreement, dated June 22, 1989 (7 pages)/(2)(6)/
. Executive Employment Agreement, dated July 1, 1991 (3 pages)/(2)(6)/
. Executive Employment Agreement, dated December 29, 1995/(6)/
. Consulting Agreement, dated January 1, 1996/(6)/
. Executive Letter Agreement and Promissory Note, dated July 31, 1995 (2
pages)/(6)/
-45-
<PAGE>
. Equifax Inc. Omnibus Stock Incentive Plan, as amended (14
pages)/(6)/
. Equifax Inc. Omnibus Stock Incentive Plan 1994 Incentive and Non-
Qualified Stock Option Agreements (8 pages)/(4)(6)/
. Equifax Inc. Omnibus Stock Incentive Plan 1995 Incentive and Non-
Qualified Stock Option Agreements (8 pages)/(5)(6)/
. Equifax Inc. Omnibus Stock Incentive Plan 1995 Non-Qualified Stock
Option Agreement (4 pages)/(5)(6)/
. Equifax Inc. Omnibus Stock Incentive Plan Restricted Stock Award
Agreement (16 pages)/(2)//(6)/
. Equifax Inc. Omnibus Stock Incentive Plan 1994 Restricted Stock
Award Agreement (4 pages)/(4)(6)/
. Equifax Inc. Omnibus Stock Incentive Plan 1995 Restricted Stock
Award Agreement (3 pages)/(5)(6)/
. Equifax Inc. Non-Employee Director Stock Option Plan and Agreement
(10 pages)/(5)(6)/
. Equifax Inc. Supplemental Executive Retirement Plan (24
pages)/(5)(6)/
. Equifax Inc. Supplemental Executive Retirement Plan Amendments (26
pages)/(4)//(6)/
. Equifax Inc. Severance Pay Plan for Salaried Employees (18
pages)/(4)(6)/
. Agreement For Computerized Credit Reporting Services (204
pages)/(4)/
. Amendments to Agreement for Computerized Credit Reporting Services
and related documents (66 pages)/(2)/
. Amendment to Agreement for Computerized Credit Reporting Services (8
pages)/(3)/
. Amendment to Agreement for Computerized Credit Reporting Services (9
pages)/(4)/
. Amendment to Agreement for Computerized Credit Reporting Services
(14 pages)/(5)/
. Computer and network operations agreement (31 pages)/(4)/
. Purchase and Lease Agreement (109 pages)/(4)/
. Headquarters Facility Lease (77 pages)/(4)/
-46-
<PAGE>
. Participation Agreement (148 pages)/(4)/
. Lease Agreement (71 pages)/(4)/
. Compensation of Directors - The Company's by-laws, which are filed as
an exhibit to this Form 10-K Annual Report, describe, on page 4 thereof,
under Section III, "Compensation of Directors," the fees paid to
Directors of the Company. Said information is hereby incorporated by
reference.
. Life Insurance - Messrs. C. B. Rogers, Jr. and L. A. Ault, III each
own a personal life insurance policy in the face amount of $1,000,000 and
$2,000,000, respectively. The Company pays the annual premiums on said
policies.
Subsidiaries of the Registrant (3 pages)
Consent of Independent Public Accountants to incorporation by reference (1 page)
Financial Data Schedule (1 page)
/(1)/Previously filed as pages 8 through 16 and Exhibit 4.1 on Amendment No. 1
to Form S-3, Registration Statement No. 33-62820, filed June 17, 1993, and
hereby incorporated by reference.
/(2)/Previously filed as an exhibit on Form 10-K, filed March 27, 1992, and
hereby incorporated by reference.
/(3)/Previously filed as an exhibit on Form 10-K, filed March 30, 1993, and
hereby incorporated by reference.
/(4)/Previously filed as an exhibit on Form 10-K, filed March 31, 1994, as
amended on Form 10-K/A, filed October 14, 1994, and hereby incorporated by
reference.
/(5)/Previously filed as an exhibit on Form 10-K, filed March 30, 1995 and
hereby incorporated by reference.
/(6)/Management Contract or Compensatory Plan
Copies of the Company's Form 10-K which are furnished pursuant to the written
request of the Company's shareholders do not include the exhibits listed above.
Any shareholder desiring copies of one or more such exhibits should write the
Secretary of the Company at P.O. Box 4081, Atlanta, Georgia 30302, specifying
the exhibit or exhibits and enclosing a check for the amount resulting from
multiplying $.50 times the number of pages (as indicated above) of the
exhibit(s) requested.
(b) Reports on Form 8-K
The Company did not file any reports on Form 8-K during the fourth quarter
of the year ended December 31, 1995.
-47-
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
EQUIFAX INC.
Date March 28, 1996 By /s/ T. H. Magis
---------------------------------
T. H. Magis, Corporate Vice
President, Secretary and General
Counsel
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Date March 28, 1996 /s/ C. B. Rogers, Jr.
-----------------------------------
C. B. Rogers, Jr., Chairman of the
Board
Date March 28, 1996 /s/ D. W. McGlaughlin
-----------------------------------
D. W. McGlaughlin, President, Chief
Executive Officer and Director
Date March __, 1996
-----------------------------------
Thomas F. Chapman, Executive Vice
President and Director
Date March 28, 1996 /s/ D. U. Hallman
-----------------------------------
D. U. Hallman, Senior Vice
President and Chief Financial
Officer
Date March 28, 1996 /s/ P. J. Mazzilli
-----------------------------------
P. J. Mazzilli, Corporate Vice
President and Controller
(Principal Accounting Officer)
Date March 28, 1996 /s/ J. L. Clendenin
-----------------------------------
J. L. Clendenin, Director
-48-
<PAGE>
Date March 28, 1996 /s/ Larry Prince
-----------------------------------
Larry Prince, Director
Date March 28, 1996 /s/ D. Raymond Riddle
-----------------------------------
D. Raymond Riddle, Director
Date March , 1996
-----------------------------------
A. W. Dahlberg, Director
Date March 28, 1996 /s/ L. Phillip Humann
-----------------------------------
L. Phillip Humann, Director
Date March , 1996
-----------------------------------
Dr. L. W. Sullivan, Director
Date March 28, 1996 /s/ Lee A. Ault
-----------------------------------
Lee A. Ault, III, Director
Date March 28, 1996 /s/ Dr. Betty L. Siegel
-----------------------------------
Dr. Betty L. Siegel, Director
Date March , 1996
-----------------------------------
Ron D. Barbaro, Director
Date March 28, 1996 /s/ J.C. Chartrand
-----------------------------------
J. C. Chartrand, Executive
Vice President and Director
Date March 28, 1996 /s/ Tinsley H.Irvin
-----------------------------------
Tinsley H. Irvin, Director
-49-
<PAGE>
INDEX TO EXHIBITS
EXHIBIT
NUMBER
- -------
Articles of Incorporation and By-laws
3.1 . Articles of Incorporation (P-Filed under Form SE)
3.2 . By-Laws
Instruments Defining the Rights of Security Holders, Including
Indentures
4.1 . Loan Agreement
4.2 . Portion of Prospectus and Trust Indenture /(1)/
Material Contracts and Compensation Plans
10.1 . Equifax Inc. 1988 Performance Share Plan for Officers, as
amended/(5)(6)/
10.2 . Equifax Inc. Incentive Compensation Plan/(6)/
10.3 . Deferred Compensation Plan/(6)/
10.4 . Change in Control Agreement/(4)(6)/
10.5 . Executive Employment Agreement, dated June 22, 1989/(2)(6)/
10.6 . Executive Employment Agreement, dated July 1, 1991/(2)(6)/
10.7 . Executive Employment Agreement, dated December 29, 1995/(6)/
10.8 . Consulting Agreement, dated January 1, 1996/(6)/
10.9 . Executive Letter Agreement and
Promissory Note, dated July 31, 1995
10.10 . Equifax Inc. Omnibus Stock Incentive Plan, as amended /(6)/
10.11 . Equifax Inc. Omnibus Stock Incentive Plan 1994 Incentive and Non-
Qualified Stock Option Agreements/(4)(6)/
10.12 . Equifax Inc. Omnibus Stock Incentive Plan 1995 Incentive and Non-
Qualified Stock Option Agreements/(5)(6)/
-50-
<PAGE>
10.13 . Equifax Inc. Omnibus Stock Incentive Plan 1995 Non-Qualified Stock
Option Agreement/(5)(6)/
10.14 . Equifax Inc. Omnibus Stock Incentive Plan Restricted Stock Award
Agreement/(2)(6)/
10.15 . Equifax Inc. Omnibus Stock Incentive Plan 1994 Restricted Stock Award
Agreement/(4)(6)/
10.16 . Equifax Inc. Omnibus Stock Incentive Plan 1995 Restricted Stock Award
Agreement/(5)(6)/
10.17 . Equifax Inc. Non-Employee Director Stock Option Plan and
Agreement/(5)(6)/
10.18 . Equifax Inc. Supplemental Executive Retirement Plan/(5)(6)/
10.19 . Equifax Inc. Supplemental Executive Retirement Plan
Amendments/(4)(6)/
10.20 . Equifax Inc. Severance Pay Plan for Salaried Employees/(4)(6)/
10.21 . Agreement For Computerized Credit Reporting Services/(4)(5)/
10.22 . Amendments to Agreement for Computerized Credit Reporting Services
and related documents/(2)/
10.23 . Amendment to Agreement for Computerized Credit Reporting
Services/(3)/
10.24 . Amendment to Agreement for Computerized Credit Reporting
Services/(4)/
10.25 . Amendment to Agreement for Computerized Credit Reporting
Services/(5)/
10.26 . Computer and network operations agreement/(4)/
10.27 . Purchase and Lease Agreement/(4)/
10.28 . Headquarters Facility Lease/(4)/
10.29 . Participation Agreement/(4)/
10.30 . Lease Agreement/(4)/
. Compensation of Directors - The Company's by-laws, which are filed as
an exhibit to this Form 10-K Annual Report, describe, on page 4
thereof, under Section III, "Compensation of Directors," the fees
paid to Directors of the Company. Said information is hereby
incorporated by reference.
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<PAGE>
. Life Insurance - Messrs. C. B. Rogers, Jr. and L. A. Ault, III each
own a personal life insurance policy in the face amount of
$1,000,000 and $2,000,000 respectively. The Company pays the annual
premiums on said policies.
21 Subsidiaries of the Registrant
23 Consent of Independent Public Accountants to incorporation by
reference
27 Financial Data Schedule
/(1)/Previously filed as pages 8 through 16 and Exhibit 4.1 on Amendment No. 1
to Form S-3, Registration Statement No. 33-62820, filed June 17, 1993, and
hereby incorporated by reference.
/(2)/Previously filed as an exhibit on Form 10-K, filed March 27, 1992 and
hereby incorporated by reference.
/(3)/Previously filed as an exhibit on Form 10-K, filed March 30, 1993, and
hereby incorporated by reference.
/(4)/Previously filed as an exhibit on Form 10-K, filed March 31, 1994, as
amended on Form 10-K/A, filed October 14, 1994, and hereby incorporated by
reference.
/(5)/Previously filed as an exhibit on Form 10-K, filed March 30, 1995, and
hereby incorporated by reference.
/(6)/Management Contract or Compensatory Plan
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<PAGE>
EXHIBIT 3.2
BY-LAWS OF EQUIFAX INC.
Revised to incorporate changes adopted by the Board of Directors
in its meeting held January 31, 1996
I
STOCKHOLDERS
A. Annual Meeting: The Annual Meeting of the Shareholders of this Company
- ------------------
shall be held during the first five months after the end of each fiscal year of
the Corporation at such time and place, within or without the State of Georgia,
as shall be fixed by the Board of Directors, for the purpose of electing
Directors and for the transaction of such other business as may be brought
before the meeting.
It shall be the duty of the Secretary to cause notice of each Annual Meeting to
be mailed to each Shareholder of record at his last known address at least ten
days before the date of said meeting. Any failure to mail such notice or any
irregularity in such notice shall not affect the validity of any Annual Meeting
or any proceedings had at any such meeting.
B. Special Meetings: Special meetings of the Stockholders may be held at the
- --------------------
principal office of the Company in the State of Georgia or at such other place
in the State of Georgia as may be named in the call therefor. Such special
meetings may be called by the Chairman of the Board of Directors, the Vice
Chairman, the President, the Board of Directors by vote at a meeting or a
majority of the Directors in writing without a meeting. Notice of such special
meetings shall indicate briefly the object or objects thereof, shall be signed
by the Secretary, and by him or by his authority mailed or delivered to each
Stockholder entitled to vote at such meeting. Such notice, if mailed, shall be
mailed to the last known address of the Stockholder at least ten days before the
date of said meeting. Nevertheless, if all of the Stockholders shall waive
notice of the special meeting, no notice of such meeting shall be required.
When all of the Stockholders shall meet in person or by proxy, such meeting
shall be valid for all purposes, without call or notice, and at such meeting any
or all corporate action may be taken, notwithstanding the limitation of the
notice.
C. At any meeting of the Stockholders, the holders of one-half of all shares of
- --
the capital stock of the Company entitled to vote at said meeting, present in
person or represented by proxy, shall constitute a quorum of Stockholders for
all purposes. If the holders of the amount of stock necessary to constitute a
quorum shall fail to attend in person or by proxy at the time and place fixed by
these By-Laws for an Annual Meeting or fixed by notice as provided for a special
meeting, a majority in interest of Stockholders present in person or by proxy
may adjourn from time to
<PAGE>
time, without notice other than by announcement at the meeting, until the
holders of the amount of stock requisite to constitute a quorum shall attend. At
any such adjourned meeting at which a quorum shall be present, any business may
be transacted which might have been transacted at the meeting as originally
notified.
D. The Chairman of the Board, if there be one, or, if not, the designated Chief
- --
Executive Officer of this Company, shall call the meeting of the Stockholders to
order and shall act as Chairman of such meeting; in the absence of both the
Chairman of the Board and the designated Chief Executive Officer, the meeting
shall be called to order by the senior Executive Vice President or, in his
absence also, by the next senior Executive Vice President then present, or in
the absence of all Executive Vice Presidents, by one of the Vice Presidents, who
shall act as Chairman thereof. The Secretary of the Company shall act as
secretary of the meeting of the Stockholders. In the absence of the Secretary,
at any meeting of the Stockholders, the presiding officer may appoint any person
to act as secretary of the meeting.
E. At each meeting of the Stockholders, every Stockholder entitled to vote at
- --
said meeting shall be entitled to vote in person or by proxy, which proxy shall
be evidenced by a writing subscribed by such Stockholder or by his duly
authorized attorney. Each Stockholder shall have one vote for each share of
stock of this Company then entitled to vote at such meeting which was registered
in his name at the time of the closing of the transfer books for said meeting,
if said books were closed, and, if not closed, standing in his name at the time
of said meeting.
F. The Board of Directors is hereby authorized to fix a record date, not
- --
exceeding fifty days and not less than ten days preceding the date of any
meeting of the Shareholders, for determining Shareholders entitled to notice of
and to vote at such meeting or adjournment thereof. In any case in which the
Board of Directors does not provide for setting such record date, the fiftieth
day preceding the date of the meeting of the Shareholders shall be the record
date for the determination of the Shareholders entitled to notice of and to vote
at such meeting.
II
BOARD OF DIRECTORS
A. The business and the property of the Company shall be managed and controlled
- --
by the Board of Directors. The Directors shall consist of not less than nine,
nor more than fifteen Shareholders, and the number of Directors shall be
determined, from time to time, by the Board of Directors or the Shareholders.
Each Director shall be elected for an initial term of office not to exceed three
years. At each annual election, the successors to the Directors whose terms
expire in that year shall be elected, or reelected, to hold office for a term
of three years, so that the term of office of one class of Directors shall
expire each year.
-2-
<PAGE>
The Chairman of the Board may continue to serve as an active Director after
retirement as Chief Executive Officer of the Company until reaching seventy
years of age.
Any other Director reaching seventy years of age, sixty-five years of age for
Directors who are also employees of the Company, or ceases to continue a regular
business relationship shall automatically retire from the Board, except that a
non-employee Director who ceases to continue a regular business relationship may
continue serving as a Director until the next annual meeting of shareholders or
seventy years of age, whichever first occurs. Notwithstanding the preceding, a
non-employee Director may at the request of the Chairman and ratified by the
Board continue to serve until age seventy when the Director continues in a
position or business activity that the Board determines would be of substantial
benefit to the Company.
For the purpose of this Section A, the expression "regular business
relationship" means a relationship as an employee, consultant or officer of a
substantial business, professional or educational organization, which requires
exercise of business judgment on a regular basis, and which is not less in
seniority than the position occupied at the time first elected as a Director to
the Board.
The number of Directors may be altered from time to time by the alteration of
these By-Laws. The term of office of a Director may be altered by a vote of the
holders of the majority of the shares of the capital stock of this Company
entitled to vote on matters of ordinary business of the Company, or by a vote of
two-thirds of the Board of Directors. Every Director shall be the holder of at
least one share of the capital stock of this Company. Each Director shall serve
for the term for which he shall have been elected and until his successor shall
have been duly chosen, unless his term be sooner ended as herein permitted;
provided, however, that should a Director sell all of his stock, the sale of
said stock shall work a resignation of his office as a Director.
B. In the event of a vacancy in the Directors of any class, by death,
- --
resignation, disqualification, removal, or otherwise, the remaining Directors,
by an affirmative vote of a majority thereof, may elect a successor to hold
office for the unexpired portion of the term of the Director whose place shall
be vacant and until the election of his successor.
C. The Directors may have an office and keep the books of the Company in such
- --
place or places in the State of Georgia or out of the State of Georgia as the
Board from time to time may determine.
D. Regular meetings of the Board of Directors shall be held on the last
- --
Wednesday in the months of January, April, July and October, if not a legal
holiday, or, if a legal holiday, then on the next succeeding day not a legal
holiday. When desirable to do so, the date of the meeting may be changed on the
approval of the Board of Directors or the Executive Committee. Also, the time
and place of
-3-
<PAGE>
the meeting may be fixed from time to time by the Directors, otherwise by the
Secretary in the notice of the meeting.
The Secretary shall give notice of each regular meeting by mailing or delivering
the same at least five days before the meeting, or by telegraphing the same at
least two days before the meeting, to each Director, but such notice may be
waived by any Director. The attendance by any Director upon any meeting shall
be a waiver of notice of the time and place of holding the said meeting.
E. Special meetings of the Board of Directors shall be held whenever called by
- --
the direction of the Chairman of the Board, if there be one and if he be
present, or by the Vice Chairman, if there be one, or by the President, or by
one-third of the Directors for the time being in office.
The Secretary shall give the same type notice for special meetings as is
required for regular meetings. Unless otherwise indicated in the notice
thereof, any and all business of the Company may be transacted at any special
meeting of the Board of Directors.
F. A majority of the Board of Directors shall constitute a quorum for the
- --
transaction of business; but if at any meeting of the Board there be less than a
quorum present, the majority of those present may adjourn the meeting from time
to time.
G. Meetings of the Board of Directors, regular or special, may be held within
- --
the State of Georgia, at places other than the one at which the said meetings
are usually held; or at places out of the State. In either event, the place for
holding such special meeting shall be stated in the notice.
H. Any action that may be taken at a meeting of the Board of Directors may be
- --
taken without such meeting if a written consent is approved in the form of
minutes of a meeting, setting forth the action so taken, and signed by all of
the Directors.
III
COMPENSATION OF DIRECTORS
Directors who are salaried officers or employees of the Company shall receive no
additional compensation for service as a Director. Each Director who is not a
salaried officer or employee of the Company shall be compensated as set forth
below.
The Chairman of the Board shall receive a fee of $7,500 per quarter, and each
other Director shall receive a fee of $5,000 per quarter, for services as a
Director. The Chairman of the Executive Committee shall receive a fee of $4,000
per quarter and any other member of the Executive Committee shall receive a fee
of $1,000 per quarter. Any Director who is chairman of any other committee
elected or appointed by the Board shall receive a fee of $1,000 per
-4-
<PAGE>
quarter. Each Director shall also receive a fee of $1,000 for attendance at any
meeting of the Board or of a committee thereof. In addition, each such Director
shall be entitled to receive stock option awards as provided for under the
Equifax Inc. Non-Employee Director Stock Option Plan.
IV
ELECTION OF OFFICERS AND COMMITTEES
A. At the April meeting of the Board of Directors in each year, or, if not done
- --
at that time, then at any subsequent meeting, the Board of Directors shall
proceed to the election of executive officers of the Company, and of the
Executive Committee, as hereinafter provided for.
B. The Board of Directors may elect from their members an Executive Committee
- --
which shall include the Chairman of the Board, if there be one, the Chief
Executive Officer, and the President. The Executive Committee shall consist of
not less than three nor more than five members, the precise number to be fixed
by resolution of the Board of Directors from time to time.
Each member shall serve one year and until his successor shall have been
elected, unless that term be sooner terminated by the Board of Directors. The
Board of Directors shall fill the vacancies in the Executive Committee by
election. The Chairman of the Board, if there be one, or, if not, the Chief
Executive Officer, shall be the Chairman of the Executive Committee.
All action by the Executive Committee shall be reported to the Board of
Directors at its meeting next succeeding such action, and shall be subject to
revision or alteration by the Board of Directors, provided that no rights or
interests of third parties shall be affected by any such revision or alteration.
The Executive Committee shall fix its own rules and proceedings, and shall meet
where and as provided by such rules or by resolution of the Board of Directors.
In every case, the affirmative vote of a majority of all the members of the
Committee shall be necessary to its adoption of any resolution.
C. The Board of Directors is authorized and empowered to appoint from its own
- --
body or from the Officers of the Company, or both, such other committees as it
may think best, and may delegate to or confer upon such committees all or such
part of its powers, and may prescribe the exercise thereof as it may deem
proper.
D. During the intervals between the meeting of the Board of Directors, the
- --
Executive Committee shall possess and may exercise all the powers of the Board
in the management of all the affairs of the Company, including the making of
contracts, the purchase and sale of property, the execution of legal
instruments, and all other matters in which specific direction shall not have
been given by the Board of Directors.
-5-
<PAGE>
V
OFFICERS
A. The Officers of the Company, unless otherwise provided by the Board from
- --
time to time, shall consist of the following: a Chief Executive Officer, a
President, one or more Vice Presidents (one or more of whom may be designated
Executive Vice President, one or more of whom may be designated Corporate Vice
President and one or more of whom may be designated Senior Vice President), a
Treasurer, and a Secretary, who shall be elected by the Board of Directors. The
Board of Directors may from time to time elect a Chairman and Vice Chairman of
the Board. All elected officers shall hold their respective offices at the
pleasure and subject to the will of the Board of Directors. The Board of
Directors or any Officer to whom the Board may delegate such authority, may also
elect, choose, or employ such other officers, agents, or employees as it or he
may see fit, and may prescribe their respective duties. Any two or more of said
offices may be filled by the same person, except the President and the Secretary
shall not be the same person.
The Executive Committee shall approve salaries of all elected officers and such
other employees as may be designated by the Executive Committee, except that
salaries of members of the Executive Committee shall be fixed by the Management
Compensation Committee of the Board of Directors.
B. Chairman of the Board: The Chairman of the Board of Directors shall direct
- -------------------------
the business and policies of the Company and serve as Chief Executive Officer of
the Company if so designated by the Board of Directors. He shall preside at all
meetings of the Stockholders, the Board of Directors, and the Executive
Committee. He shall also act as ex officio member of all standing committees.
Except where by law the signature of the Chief Executive Officer or President is
required, he shall have the same power as the Chief Executive Officer or
President to sign all authorized certificates, contracts, bonds, deeds,
mortgages, and other instruments. He shall have such other powers and duties as
from time to time may be assigned to him by the Board of Directors.
C. Vice Chairman: If the Chairman of the Board is not designated Chief
- -----------------
Executive Officer by the Board of Directors, and if so designated by the Board
of Directors, the Vice Chairman shall serve as Chief Executive Officer. It
shall be the duty of the Vice Chairman of the Board, in the absence of the
Chairman of the Board, to preside at meetings of the Shareholders, at meetings
of the Directors, and at meetings of the Executive Committee. He shall do and
perform all acts incident to the office of Vice Chairman and, if so designated,
those of Chief Executive Officer, subject to the approval and direction of the
Board of Directors.
D. President: The President shall be the Chief Operating Officer of the
- -------------
Company and shall have general charge of the business of the Company subject to
the specific direction and approval of the Board of Directors or its Chairman or
Vice Chairman or the Executive
-6-
<PAGE>
Committee. If the Chairman or Vice Chairman of the Board is not designated Chief
Executive Officer by the Board of Directors, the President shall also serve as
Chief Executive Officer. In the event of a vacancy in the office of Chairman and
Vice Chairman of the Board or during the absence or disability of both the
Chairman and the Vice Chairman, the President shall serve as Chief Executive
Officer and shall have all of the rights, powers and authority given hereunder
to the Chairman of the Board. He may sign all authorized certificates,
contracts, bonds, deeds, mortgages, and other instruments, except in cases in
which the signing thereof shall have been expressly delegated to some other
Officer or Agent of the Company. He shall also act as an ex officio member of
all standing committees and shall have authority, subject to the approval of the
Chairman and Vice Chairman of the Board, to appoint and discharge all employees
or agents of the Company, other than Officers. In general, he shall have the
usual powers and duties incident to the office of a President of a Corporation
and such other powers and duties as from time to time may be assigned to him by
the Board or Chairman or Vice Chairman of the Board.
In case of the death, absence, or inability to act as the President, his power
shall be exercised and his duties discharged by the senior Executive Vice
President; or if there is no Executive Vice President, by the Vice President,
who is the senior by years of service in that office, until such time as the
Executive Committee shall designate another individual to exercise said powers
and discharge said duties.
The President shall hold office at the pleasure of the Board of Directors.
E. Executive Vice Presidents: Each shall have authority, in behalf of the
- -----------------------------
Corporation, to execute, approve, or accept agreements for service, bids, or
other contracts, and shall sign such other instruments as each is authorized or
directed to sign by the Board of Directors or its Committee or by the Chief
Executive Officer or the President. Each shall do and perform all acts incident
to the office of the Executive Vice President of the Company or as may be
directed by its Board of Directors or its Committee or the Chief Executive
Officer or the President.
In case of the death, absence, or inability to act as an Executive Vice
President, his powers shall be exercised and his duties discharged by such
Officer of the Company who is delegated to perform such duties by resolution of
the Board of Directors or its authority.
Each Executive Vice President shall hold office at the pleasure of the Board of
Directors.
F. Vice Presidents: There shall be one or more Vice Presidents of this
- -------------------
Company, as the Board of Directors may from time to time elect. Each Vice
President shall have such power and perform such duties as may be assigned him
by the Board of Directors or its authority.
-7-
<PAGE>
They shall hold office at the pleasure of the Board of Directors.
G. Treasurer: It shall be the duty of the Treasurer to have the care and
- -------------
custody of all funds of the Company which may come into his hands, and to
deposit the same in such bank or banks or trust company or trust companies as
shall be indicated by the Board of Directors or its authority and he shall pay
out and dispose of the same as directed by the Chief Executive Officer, the
President, the Executive Vice President or the Board of Directors or its
authority. He shall have general charge of all the books, vouchers, and papers
belonging to the Company, and shall perform such other duties as are incident to
the office of Treasurer or as may be required by the Chief Executive Officer,
the President, the Executive Vice President or the Board of Directors or its
authority. He shall at all reasonable times exhibit his books and accounts to
anyone when ordered to do so by the Board of Directors or its authority, but
shall not be obliged to exhibit the same to any Stockholder unless ordered to do
so by the Board of Directors or its authority.
The Treasurer shall hold office at the pleasure of the Board of Directors.
H. Secretary: The Secretary shall keep the minutes of the Stockholders and
- -------------
Directors Meetings, and of all Committees of these bodies, should such
committees require it. He shall attend to the giving and serving of all notices
by the Company, shall countersign all certificates of stock, and shall affix the
Seal of the Company to all certificates of stock when signed by the Chief
Executive Officer, the President or one of the Vice Presidents, and to such
other instruments as he may be directed by the Chief Executive Officer, the
President, the Executive Vice President or Vice President or the Board of
Directors or its authority. Subject to the possession, rights, and duties of
the Transfer Agent and/or Registrar of this Company, if there be one, he shall
have charge of the certificate book, transfer book, and stock ledger, and such
other books, papers, and accounts as may be required by the Chief Executive
Officer, the President or Executive Vice President or the Board of Directors or
its authority, all of which books shall be open at all times to the examination
of any Director, but not to any Stockholder who is not a Director except when
ordered by the Board of Directors or its authority. He shall perform such other
duties of whatever kind pertaining to the business of the Company as may be
required by the Chief Executive Officer, the President or Executive Vice
President or the Board of Directors or its authority.
The Secretary shall hold office at the pleasure of the Board of Directors.
I. Junior Officers and Agents: In all cases where the duties of the junior
- ------------------------------
officers and agents of the Company are not especially prescribed by the By-Laws
or by resolution of the Board of Directors, such officers and agents shall obey
the orders and instructions of the Chief Executive Officer, the President or the
-8-
<PAGE>
Executive Vice President or Vice Presidents having immediate jurisdiction over
them. The Chief Executive Officer, the President or an Executive Vice President
or the Officer acting as President, may suspend or remove any junior officer, or
other employee of the Company, and shall report the same to the Chairman of the
Board of Directors, if there be one, or, if not, to the Executive Committee, and
such Chairman or Committee may either confirm or revoke or modify the order of
the Chief Executive Officer, or the President or Executive Vice President or
Officer acting as such.
J. Bond of Officers and Agents: The officers and agents of the Company shall
- -------------------------------
give such bonds, with good security, for the faithful discharge of their duties
as may be required by the Board of Directors or its authority, such bonds to be
approved by the Chief Executive Officer or the President except as to the bond
of the Chief Executive Officer and the President, which shall be approved by the
Treasurer.
K. Unless otherwise ordered by the Board of Directors or Executive Committee,
- --
the Chairman of the Board, the Vice Chairman, the President or any Executive
Vice President of this Company shall have full power and authority in behalf of
this Company to attend and to act and to vote at any meetings of stockholders of
any corporation in which the Company may hold stock, and at such meetings may
possess and shall exercise any and all rights and powers incident to the
ownership of such stock which such owner thereof (the Company) might have
possessed and exercised if present. The Board of Directors or Executive
Committee, by resolution from time to time, may confer like powers upon any
other person or persons.
V-A
INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES
AND AGENTS; INSURANCE
A. This Company shall indemnify any person who was or is a party or is
- --
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Company) by reason of the fact
that he is or was a director, officer, employee or agent of the Company, or is
or was serving at the request of the Company as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in a manner he reasonably
believed to be in or not opposed to the best interests of the Company, and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
his conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the
-9-
<PAGE>
person did not act in a manner which he reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any criminal
action or proceeding, had reasonable cause to believe that this conduct was
unlawful.
B. The Company shall indemnify any person who was or is a party or is
- --
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Company to procure a judgment in its favor by
reason of the fact he is or was a director, officer, employee or agent of the
Company, or is or was serving at the request of the Company as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection with the defense or settlement of
such action or suit if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Company and except
that no indemnification shall be made in respect of any claim, issue or matter
as to which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the Company unless and only to the
extent that the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the court shall deem proper.
C. To the extent that a person indemnified under this By-Law has been
- --
successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in paragraphs A and B of this Section, or in defense of
any claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
D. The indemnification under paragraphs A and B of this Section (unless
- --
ordered by a court) shall be effective upon the Company only when authorized in
the specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in paragraphs A and B. Such
determination shall be made (1) by the Board of Directors by a majority vote of
a quorum consisting of Directors who were not parties to such action, suit or
proceeding or (2) if such a quorum is not obtainable, or, even if obtainable a
quorum of disinterested Directors so directs, by independent legal counsel in a
written opinion, or (3) by the affirmative vote of a majority of the shares
entitled to vote thereon.
E. Expenses incurred in defending a civil or criminal action, suit or
- --
proceeding may be paid by the Company in advance of the final disposition of
such action, suit or proceeding as authorized in the specific case upon receipt
of an undertaking by or on behalf of the director, officer, employee or agent to
repay such amount unless it shall ultimately be determined that he is entitled
to be
-10-
<PAGE>
indemnified by the Company as authorized in this Section.
F. The indemnification provided by this Section shall not be deemed exclusive
- --
of any other rights to which those seeking indemnification may be entitled under
any By-Law or resolution approved by the affirmative vote of the holders of a
majority of the shares entitled to vote thereon taken at a meeting the notice of
which specified that such By-Law or resolution would be placed before the
Stockholders, both as to action by a director, officer, employee or agent in his
official capacity and as to action in another capacity while holding such office
or position, and shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person.
G. The Company and its Officers shall have power to purchase and maintain
- --
insurance on behalf of any person who is or was a director, officer, employee or
agent of the Company, or is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the Company would have the power to indemnify him against such
liability under the provisions of this Section.
H. If, under this Section, any expenses or other amounts are paid by way of
- --
indemnification, otherwise than by court order or action by the Stockholders,
the Company shall, not later than the next Annual Meeting of Stockholders unless
such meeting is held within three months from the date of such payment, send by
first class mail to its Stockholders of record at the time entitled to vote for
the election of Directors a statement specifying the persons paid, the amounts
paid, and the nature and status at the time of such payment of the litigation or
threatened litigation.
VI
CAPITAL STOCK
A. Certificate of Shares: The certificate of shares of the capital stock of
- -------------------------
the Company shall be in such form not inconsistent with the Charter of the
Company as shall be approved by the Board of Directors. Certificates for stock
of the Company may be signed by the President or other Chief Executive Officer
or a Vice President and also by the Secretary and the corporate seal thereunto
affixed or may be signed with the facsimile signatures of the President or other
Chief Executive Officer or a Vice President and of the Secretary, with a
facsimile of the seal of the Corporation and in all cases a stock certificate
must also be signed by the Transfer Agent for the stock.
All certificates shall be consecutively numbered. The name of the person owning
the shares represented thereby, with the number of
-11-
<PAGE>
such shares and the date of issue, shall be entered on the Company's books. All
certificates surrendered to the Company shall be canceled and no new
certificates shall be issued until the former certificate for the same number of
shares of the same class shall have been surrendered and canceled.
B. Transfer of Shares: The shares in the capital stock of the Company shall be
- ----------------------
transferred only on the books of the Company by the holder thereof, in person or
by his attorney, upon surrender and cancellation of certificates for a like
number of shares. Transfer of shares shall be in accordance with such
reasonable rules and regulations as may be made from time to time by the Board
of Directors.
C. The Board of Directors shall have authority to appoint a Transfer Agent
- --
and/or a Registrar for the shares of its capital stock, and to empower them or
either of them in such manner and to such extent as it may deem best, and to
remove such agent or agents from time to time, and to appoint another agent or
other agents.
VII
REGULATIONS
The Board of Directors and the Executive Committee shall have power and
authority to make all such rules and regulations as, respectively, they may deem
expedient concerning the issue, transfer, and registration of certificates for
shares of the capital stock of the Company.
VIII
DIVIDENDS
The Board of Directors may from time to time declare dividends from the surplus
or from the net earned profits of the Company.
IX
CORPORATE SEAL
The Board of Directors shall provide a suitable Seal, containing the name of the
Company, which Seal shall be in charge of the Secretary.
X
AMENDMENTS
The Board of Directors shall have power to make, amend, and repeal these By-Laws
by a vote of two-thirds of all Directors at any
-12-
<PAGE>
regular meeting or special meeting of the Board. At any regular or special
meeting, the Stockholders, by a majority vote of the shares outstanding, may
amend, alter or repeal these By-Laws, and may adopt new By-Laws in whole or in
part. Notwithstanding the preceding two sentences, Articles XI and XII of these
By-Laws shall be amended only in the manner provided by Georgia Law, as such law
may relate to said Articles XI and XII.
XI
SPECIAL REQUIREMENTS FOR
CERTAIN BUSINESS COMBINATIONS
The requirements of Sections 14-2-232 through 14-2-235 of the Official Code of
Georgia, as such Sections may be amended or supplemented from time to time,
shall apply to business combinations of this Company to the full extent set
forth in such Code Sections as if the requirements of such Code Sections were
set forth at length herein.
XII
ADDITIONAL REQUIREMENTS FOR
CERTAIN BUSINESS COMBINATIONS
The requirements of Article 11A of the Georgia Business Corporation Code, or any
successor provisions thereof, as amended or supplemented from time to time,
shall apply to business combinations of this Company to the full extent set
forth in the Georgia Business Corporation Code as if the requirements of such
provisions were set forth at length herein.
-13-
<PAGE>
EXHIBIT 4.1
$550,000,000
CREDIT AGREEMENT
dated as of
August 2, 1995
among
Equifax Inc.,
Certain Of Its Wholly Owned Subsidiaries,
The Banks Listed Herein
and
WACHOVIA BANK OF GEORGIA, N.A.,
as Agent
<PAGE>
TABLE OF CONTENTS
CREDIT AGREEMENT
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE I
DEFINITIONS........................ 1
SECTION 1.01. Definitions............................................ 1
-----------
SECTION 1.02. Accounting Terms and Determinations.................... 19
-----------------------------------
SECTION 1.03. References............................................. 19
----------
SECTION 1.04. Use of Defined Terms................................... 19
--------------------
SECTION 1.05. Terminology............................................ 20
-----------
ARTICLE II
THE CREDITS........................ 20
SECTION 2.01. Commitments to Lend Syndicated Loans................... 20
------------------------------------
SECTION 2.02. Method of Borrowing.................................... 21
-------------------
SECTION 2.03. Money Market Loans..................................... 23
------------------
SECTION 2.04. Notes.................................................. 28
-----
SECTION 2.05. Maturity of Loans...................................... 29
-----------------
SECTION 2.06. Interest Rates......................................... 29
--------------
SECTION 2.07. Fees................................................... 32
----
SECTION 2.08. Optional Termination or Reduction of Commitments....... 33
------------------------------------------------
SECTION 2.09. Mandatory Termination of Commitments................... 33
------------------------------------
SECTION 2.10. Optional Prepayments................................... 33
--------------------
SECTION 2.11. Mandatory Prepayments and Repayments................... 34
------------------------------------
SECTION 2.12. General Provisions as to Payments...................... 34
---------------------------------
</TABLE>
(i)
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 2.13. Computation of Interest and Fees....................... 36
--------------------------------
SECTION 2.14. Election and Release of Borrowers...................... 37
---------------------------------
ARTICLE III
CONDITIONS TO BORROWINGS.................. 37
SECTION 3.01. Conditions to First Borrowing.......................... 37
-----------------------------
SECTION 3.02. Conditions to All Borrowings........................... 39
----------------------------
ARTICLE IV
REPRESENTATIONS AND WARRANTIES............... 40
SECTION 4.01. Corporate Existence and Power.......................... 40
-----------------------------
SECTION 4.02. Corporate and Governmental Authorization; No
--------------------------------------------
Contravention................................................... 40
-------------
SECTION 4.03. Binding Effect......................................... 40
--------------
SECTION 4.04. Financial Information.................................. 41
---------------------
SECTION 4.05. No Litigation.......................................... 41
-------------
SECTION 4.06. Compliance with ERISA.................................. 41
---------------------
SECTION 4.07. Compliance with Laws; Payment of Taxes................. 41
--------------------------------------
SECTION 4.08. Subsidiaries; Identification of Consolidated
--------------------------------------------
Subsidiaries.................................................... 42
------------
SECTION 4.09. Investment Company Act................................. 42
----------------------
SECTION 4.10. Public Utility Holding Company Act..................... 42
----------------------------------
SECTION 4.11. Ownership of Property; Liens........................... 42
----------------------------
SECTION 4.12. No Default............................................. 43
----------
SECTION 4.13. Full Disclosure........................................ 43
---------------
SECTION 4.14. Environmental Matters.................................. 43
---------------------
SECTION 4.15. Capital Stock.......................................... 44
-------------
SECTION 4.16. Margin Stock........................................... 44
------------
</TABLE>
(ii)
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 4.17. Insolvency............................................. 44
----------
SECTION 4.18. Insurance.............................................. 45
---------
SECTION 4.19. Investments............................................ 45
-----------
ARTICLE V
COVENANTS......................... 45
SECTION 5.01. Information............................................ 45
-----------
SECTION 5.02. Inspection of Property, Books and Records.............. 47
-----------------------------------------
SECTION 5.03. Maintenance of Existence............................... 48
------------------------
SECTION 5.04. Dissolution............................................ 48
-----------
SECTION 5.05. Consolidations, Mergers and Sales of Assets............ 48
-------------------------------------------
SECTION 5.06. Use of Proceeds........................................ 49
---------------
SECTION 5.07. Compliance with Laws; Payment of Taxes................. 49
--------------------------------------
SECTION 5.08. Insurance.............................................. 50
---------
SECTION 5.09. Change in Fiscal Year.................................. 50
---------------------
SECTION 5.10. Maintenance of Property................................ 50
-----------------------
SECTION 5.11. Environmental Notices.................................. 50
---------------------
SECTION 5.12. Environmental Matters.................................. 50
---------------------
SECTION 5.13. Environmental Release.................................. 51
---------------------
SECTION 5.14. Transactions with Affiliates........................... 51
----------------------------
SECTION 5.15. Restricted Investments................................. 51
----------------------
SECTION 5.16. Loans or Advances...................................... 51
-----------------
SECTION 5.17. Debt of Consolidated Subsidiaries...................... 52
---------------------------------
SECTION 5.18. Negative Pledge........................................ 52
---------------
SECTION 5.19. Fixed Charges Coverage................................. 52
----------------------
SECTION 5.20. Ratio of Net Funded Debt to Cash Flow.................. 53
-------------------------------------
</TABLE>
(iii)
<PAGE>
<TABLE>
<S> <C> <C>
ARTICLE VI
DEFAULTS.......................... 53
SECTION 6.01. Events of Default...................................... 53
-----------------
SECTION 6.02. Notice of Default...................................... 57
-----------------
ARTICLE VII
THE AGENT......................... 57
SECTION 7.01. Appointment; Powers and Immunities..................... 57
----------------------------------
SECTION 7.02. Reliance by Agent...................................... 58
-----------------
SECTION 7.03. Defaults............................................... 58
--------
SECTION 7.04. Rights of Agent as a Bank.............................. 58
-------------------------
SECTION 7.05. Indemnification........................................ 59
---------------
SECTION 7.06 Consequential Damages.................................. 59
---------------------
SECTION 7.07. Payee of Note Treated as Owner......................... 59
------------------------------
SECTION 7.08. Nonreliance on Agent and Other Banks................... 60
------------------------------------
SECTION 7.09. Failure to Act......................................... 60
--------------
SECTION 7.10. Resignation or Removal of Agent........................ 60
-------------------------------
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION........... 61
SECTION 8.01. Basis for Determining Interest Rate Inadequate or
-------------------------------------------------
Unfair.......................................................... 61
------
SECTION 8.02. Illegality............................................. 61
----------
SECTION 8.03. Increased Cost and Reduced Return...................... 62
---------------------------------
SECTION 8.04. Base Rate Loans or Other Fixed Rate Loans Substituted
-----------------------------------------------------
for Affected Fixed Rate Loans................................... 64
-----------------------------
SECTION 8.05. Compensation........................................... 65
------------
SECTION 8.06. Failure to Pay in Foreign Currency..................... 66
----------------------------------
</TABLE>
(iv)
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 8.07. Judgment Currency...................................... 66
-----------------
ARTICLE IX
MISCELLANEOUS........................67
-------------
SECTION 9.01. Notices................................................ 67
-------
SECTION 9.02. No Waivers............................................. 67
----------
SECTION 9.03. Expenses; Documentary Taxes............................ 67
---------------------------
SECTION 9.04. Indemnification........................................ 68
---------------
SECTION 9.05 Setoff; Sharing of Setoffs............................. 68
--------------------------
SECTION 9.06. Amendments and Waivers................................. 69
----------------------
SECTION 9.07. No Margin Stock Collateral............................. 70
--------------------------
SECTION 9.08. Successors and Assigns................................. 70
----------------------
SECTION 9.09. Confidentiality........................................ 73
---------------
SECTION 9.10. Representation by Banks................................ 73
-----------------------
SECTION 9.11. Obligations Several.................................... 74
-------------------
SECTION 9.12. Georgia Law............................................ 74
-----------
SECTION 9.13. Severability........................................... 74
------------
SECTION 9.14. Interest............................................... 74
--------
SECTION 9.15. Interpretation......................................... 75
--------------
SECTION 9.16. Waiver of Jury Trial; Consent to Jurisdiction.......... 75
---------------------------------------------
SECTION 9.17. Counterparts........................................... 76
------------
SECTION 9.18. Source of Funds -- ERISA............................... 76
------------------------
</TABLE>
(v)
<PAGE>
EXHIBIT A-1 Form of Syndicated Loan Note
- -----------
EXHIBIT A-2 Form of Dollar Money Market Loan Note
- -----------
EXHIBIT A-3 Form of Foreign Currency Money Market Loan Note
- -----------
EXHIBIT B Form of Opinion of Counsel for the Borrower
- ---------
EXHIBIT C Form of Opinion of Special Counsel for the Agent
- ---------
EXHIBIT D Form of Assignment and Acceptance
- ---------
EXHIBIT E Form of Notice of Borrowing
- ---------
EXHIBIT F Form of Compliance Certificate
- ---------
EXHIBIT G Form of Closing Certificate
- ---------
EXHIBIT H Form of Money Market Quote Request
- ---------
EXHIBIT I Form of Money Market Quote
- ---------
EXHIBIT J Form of Parent Guaranty
- ---------
EXHIBIT K Borrower Acknowledgement and Agreement
- ---------
EXHIBIT L Borrower Notice of Withdrawal
- ---------
Schedule 4.06 Compliance with ERISA
- -------------
Schedule 4.08 Subsidiaries
- -------------
Schedule 4.14 Environmental Matters
- -------------
Schedule 4.15 Capital Stock
- -------------
Schedule 5.12 Hazardous Materials
- -------------
(vi)
<PAGE>
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of August 2, 1995 among EQUIFAX INC., its
Wholly Owned Subsidiaries which become a party hereto from time to time, the
BANKS listed on the signature pages hereof and WACHOVIA BANK OF GEORGIA, N.A.,
as Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The terms as defined in this Section 1.01
-----------
shall, for all purposes of this Agreement and any amendment hereto (except as
herein otherwise expressly provided or unless the context otherwise requires),
have the meanings set forth herein:
"Accounts Management Assets and Liabilities" has the meaning set forth
in the CSC Agreement.
"Acquisition" means any acquisition of the stock in or a significant
part of the assets of any Person, other than acquisition of supplies and raw
materials in the ordinary course of business.
"Adjusted IBOR Rate" has the meaning set forth in Section 2.06(d).
"Adjusted London Interbank Offered Rate" has the meaning set forth in
Section 2.06(c).
"Affected Bank" has the meaning set forth in Section 8.03(d).
"Affiliate" of any relevant Person means (i) any Person that directly,
or indirectly through one or more intermediaries, controls the relevant Person
(a "Controlling Person"), (ii) any Person (other than the relevant Person or a
Subsidiary of the relevant Person) which is controlled by or is under common
control with a Controlling Person, or (iii) any Person (other than a Subsidiary
of the relevant Person) of which the relevant Person owns, directly or
indirectly, 20% or more of the common stock or equivalent equity interests. As
used herein, the term "control" means possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of
<PAGE>
a Person, whether through the ownership of voting securities, by contract or
otherwise.
"Agent" means Wachovia Bank of Georgia, N.A., a national banking
association organized under the laws of the United States of America, in its
capacity as agent for the Banks hereunder, and its successors and permitted
assigns in such capacity.
"Agent's Letter Agreement" means that certain letter agreement, dated
as of May 8, 1995, between the Parent and the Agent relating to the structure of
the Loans and certain fees from time to time payable by the Borrowers to the
Agent, together with all amendments and supplements thereto.
"Agreement" means this Credit Agreement, together with all amendments
and supplements hereto.
"Aggregate Commitments" means the sum of the Commitments of all of the
Banks.
"Aggregate Outstanding Loans" means at any time the sum of (i) the
outstanding principal amount of the Syndicated Loans, plus (ii) the outstanding
----
principal amount of the Dollar Money Market Loans, and plus (iii) the Dollar
----
Equivalent of the outstanding principal amount of the Foreign Currency Money
Market Loans.
"Applicable Margin" has the meaning set forth in Section 2.06(a).
"Assignee" has the meaning set forth in Section 9.08(c).
"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with Section 9.08(c) in the form attached hereto as
Exhibit D.
- ---------
"Authority" has the meaning set forth in Section 8.02.
"Authorized Officer" means (i) any of the following officers of the
Parent: Chairman, President, Executive Vice Presidents, Senior Vice Presidents,
Chief Financial Officer, Treasurer, Assistant Treasurer and Corporate
Controller, and (ii) any other officers of the Parent as the Parent may notify
the Agent in writing from time to time.
"Bank" means each bank listed on the signature pages hereof as having
a Commitment, and its successors and assigns.
2
<PAGE>
"Base Rate" means for any Base Rate Loan for any day, the rate per
annum equal to the higher as of such day of (i) the Prime Rate, and (ii) one-
half of one percent above the Federal Funds Rate. For purposes of determining
the Base Rate or the Federal Funds Rate for any day, changes in the Prime Rate
shall be effective on the date of each such change.
"Base Rate Loan" means a Loan to be made as a Base Rate Loan pursuant
to the applicable Notice of Borrowing, Section 2.02(f), or Article VIII, as
applicable.
"Borrower" or "Borrowers" means, individually and collectively, as the
context shall require, (i) with respect to Syndicated Loans, (a) Parent, and (b)
domestic Wholly Owned Subsidiaries which are Borrowers as provided in Section
2.14, and (ii) with respect to the Money Market Loans, (a) Parent, and (b)
Wholly Owned Subsidiaries which are Borrowers as provided in Section 2.14, and
their respective successors and permitted assigns.
"Borrowing" means a borrowing hereunder consisting of Loans made to
the Borrower (i) at the same time by all of the Banks, in the case of a
Syndicated Borrowing, or (ii) separately by one or more Banks, in the case of a
Money Market Borrowing, in each case pursuant to Article II. A Borrowing is a
"Domestic Borrowing" if such Loans are Domestic Loans or a "Euro-Dollar
Borrowing" if such Loans are Euro-Dollar Loans. A Borrowing is a "Dollar
Borrowing" if it is a Domestic Borrowing or a Euro-Dollar Borrowing. A
Borrowing is a "Money Market Borrowing" if such Loans are either Dollar Money
Market Loans or Foreign Currency Money Market Loans made pursuant to Section
2.03 or a "Syndicated Borrowing" if such Loans are Syndicated Loans made
pursuant to Section 2.01. A Borrowing is a "Dollar Money Market Borrowing" if
such Loans are Dollar Money Market Loans. A Borrowing is a "Foreign Currency
Money Market Borrowing" if such Loans are Foreign Currency Money Market Loans.
"Capital Expenditures" means for any period the sum of all capital
expenditures incurred during such period by the Parent and its Consolidated
Subsidiaries, as determined in accordance with GAAP.
"Capital Stock" means any nonredeemable capital stock of a Person (to
the extent issued to another Person), whether common or preferred.
"Cash Flow" means the sum of the Parent's and its Consolidated
Subsidiaries' (i) Consolidated Net Income, plus (ii) depreciation and
----
amortization and plus (iii) other non-cash charges.
----
3
<PAGE>
"CERCLA" means the Comprehensive Environmental Response Compensation
and Liability Act, 42 U.S.C. (S) 9601 et. seq. and its implementing regulations
and amendments.
"CERCLIS" means the Comprehensive Environmental Response Compensation
and Liability Inventory System established pursuant to CERCLA.
"CSC" means Computer Sciences Corporation, a Texas corporation.
"CSC Agreement" means the Agreement for Computerized Credit Reporting
Services and Options to Purchase and Sell Assets, dated as of the 1st day of
August, 1988, among The Credit Bureau, Incorporated of Georgia, the Borrower,
CSC, CSC Credit Services, Inc., Credit Bureau of Cincinnati, Inc., Credit Bureau
of Greater Kansas City, Inc., Johns Holding Company, CSC Credit Services of
Minnesota, Inc. and CSC Accounts Management, Inc.
"CSC Put" means either of (i) the giving of any notice to the Borrower
or any Affiliate of the Borrower in accordance with the CSC Agreement which
shall require the Borrower or any Affiliate of the Borrower to purchase or
otherwise acquire the Accounts Management Assets and Liabilities, or the
Subsidiaries' Assets and Liabilities, or both of them; or (ii) the occurrence of
an event or series of events which shall result at any time or times in the
direct or indirect ownership by the Borrower, any one or more Affiliates of the
Borrower, or any combination the Borrower and any one or more of its Affiliates,
of the Accounts Management Assets and Liabilities, or the Subsidiaries Assets
and Liabilities, or both of them.
"Change of Law" shall have the meaning set forth in Section 8.02.
"Closing Certificate" has the meaning set forth in Section 3.01(e).
"Closing Date" means August 2, 1995.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor Federal tax code.
"Commitment" means, with respect to each Bank, the amount set forth
opposite the name of such Bank on the signature pages hereof, as such amount may
be reduced from time to time pursuant to Sections 2.08 and 2.09, or as set forth
in any Assignment and Acceptance executed pursuant to Section 9.08(c).
4
<PAGE>
"Compliance Certificate" has the meaning set forth in Section 5.01(c).
"Consolidated Current Assets" and "Consolidated Current Liabilities"
mean, at any time, all assets or liabilities, respectively, of the Parent and
its Consolidated Subsidiaries that, in accordance with GAAP, should be
classified as current assets or current liabilities, respectively, on a
consolidated balance sheet of the Parent and its Consolidated Subsidiaries.
"Consolidated Debt" means at any date the Debt of the Parent and its
Consolidated Subsidiaries, determined on a consolidated basis as of such date.
"Consolidated Fixed Charges" for any period means the sum of (i)
Consolidated Interest Expense for such period, and (ii) all payment obligations
of the Parent and its Consolidated Subsidiaries for such period under all
operating leases and rental agreements.
"Consolidated Interest Expense" for any period means interest, whether
expensed or capitalized, in respect of Debt of the Parent or any of its
Consolidated Subsidiaries outstanding during such period.
"Consolidated Liabilities" means the sum of (i) all liabilities that,
in accordance with GAAP, should be classified as liabilities on a consolidated
balance sheet of Parent and its Consolidated Subsidiaries, and (ii) to the
extent not included in clause (i) of this definition, all Redeemable Preferred
Stock.
"Consolidated Net Income" means, for any period, the Net Income of the
Parent and its Consolidated Subsidiaries determined on a consolidated basis, but
excluding (i) extraordinary items and (ii) any equity interests of the Parent or
any Subsidiary in the unremitted earnings of any Person that is not a
Subsidiary.
"Consolidated Net Tangible Assets" means, at any time, Consolidated
Total Assets, less the sum of the value, as set forth or reflected on the most
recent consolidated balance sheet of the Parent and its Consolidated
Subsidiaries, prepared in accordance with GAAP, of:
(A) All assets which would be treated as intangible assets for balance
sheet presentation purposes under GAAP, excluding "Purchased Data Files", but
including without limitation goodwill (as determined by the Parent in a manner
consistent with its past accounting practices and in accordance
5
<PAGE>
with GAAP), trademarks, tradenames, copyrights, patents and technologies, and
unamortized debt discount and expense;
(B) To the extent not included in (A) of this definition, any amount
at which shares of Capital Stock of the Parent appear as an asset on the balance
sheet of its Consolidated Subsidiaries; and
(C) To the extent not included in (A) of this definition, deferred
expenses.
"Consolidated Operating Profits" means, for any period, the Operating
Profits of the Parent and its Consolidated Subsidiaries.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which, in accordance with GAAP, would be consolidated
with those of the Parent in its consolidated financial statements as of such
date.
"Consolidated Total Assets" means, at any time, the total assets of
the Parent and its Consolidated Subsidiaries, determined on a consolidated
basis, as set forth or reflected on the most recent consolidated balance sheet
of the Parent and its Consolidated Subsidiaries, prepared in accordance with
GAAP.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower, are treated as a single
employer under Section 414 of the Code.
"Current Maturities of Long Term Debt" means all payments in respect
of Long Term Debt (other than Debt under this Agreement) that are required to be
made within one year from the date of determination, whether or not the
obligation to make such payments would constitute a current liability of the
obligor under GAAP.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business and except for any obligation relating to or arising out of the CSC Put
prior to the actual payment therefor, (iv) all obligations of such Person as
lessee under capital leases, (v) all obligations of such Person to reimburse any
bank or other Person in respect of amounts payable
6
<PAGE>
under a banker's acceptance, (vi) all Redeemable Preferred Stock of such Person
(in the event such Person is a corporation), (vii) all obligations of such
Person to reimburse any bank or other Person in respect of amounts paid or to be
paid under a letter of credit or similar instrument, (viii) all Debt of others
secured by a Lien on any asset of such Person, whether or not such Debt is
assumed by such Person, and (ix) all Debt and other obligations of others
Guaranteed by such Person (other than the Debt and other obligations of the
Parent or the Consolidated Subsidiaries of the Parent Guaranteed by,
respectively, the Parent or the Consolidated Subsidiaries of the Parent).
"Debt Rating" means at any time whichever is the higher of the rating
of the Parent's senior unsecured, unenhanced debt by Moody's Investor Service or
Standard and Poor's (provided, that in the event of a double or greater split
--------
rating, the rating immediately above the lowest rating shall apply), or if only
one of them rates the Parent's senior unsecured, unenhanced debt, such rating.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Default Rate" means, with respect to any Loan, on any day, the sum of
2% plus the then highest interest rate (including the Applicable Margin) which
may be applicable to any Loans hereunder (irrespective of whether any such type
of Loans are actually outstanding hereunder).
"Depreciation" means for any period the sum of all depreciation
expenses of the Parent and its Consolidated Subsidiaries for such period, as
determined in accordance with GAAP.
"Dollar Equivalent" means the Dollar equivalent of the amount of a
Foreign Currency Money Market Loan, determined by the Agent on the basis of its
spot rate for the purchase of the appropriate Foreign Currency with Dollars.
"Dollar Money Market Loans" means Money Market Loans made in Dollars.
"Dollar Money Market Loan Notes" means the promissory notes of the
Borrower, substantially in the form of Exhibit A-2, evidencing the obligation of
-----------
the Borrower to repay the Dollar Money Market Loans, together with all
amendments, consolidations, modifications, renewals and supplements thereto.
7
<PAGE>
"Dollars" or "$" means dollars in lawful currency of the United States
of America.
"Domestic Borrowing" has the meaning set forth in the definition of
"Borrowing."
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in Georgia are authorized by law to close.
"Domestic Loans" means Base Rate Loans or Dollar Money Market Loans,
or any or all of them, as the context shall require.
"Environmental Authority" means any foreign, federal, state, local or
regional government that exercises any form of jurisdiction or authority under
any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits, orders,
approvals, notices, registrations or other legal prerequisites for conducting
the business of the Parent or any Consolidated Subsidiary required by any
Environmental Requirement.
"Environmental Judgments and Orders" means all judgments, decrees or
orders arising from or in any way associated with any Environmental
Requirements, whether or not entered upon consent or written agreements with an
Environmental Authority or other entity arising from or in any way associated
with any Environmental Requirement, whether or not incorporated in a judgment,
decree or order.
"Environmental Liabilities" means any liabilities, whether accrued,
contingent or otherwise, arising from and in any way associated with any
Environmental Requirements.
"Environmental Notices" means notice from any Environmental Authority
or by any other person or entity, of possible or alleged noncompliance with or
liability under any Environmental Requirement, including without limitation any
complaints, citations, demands or requests from any Environmental Authority or
from any other person or entity for correction of any, violation of any
Environmental Requirement or any investigations concerning any violation of any
Environmental Requirement.
"Environmental Proceedings" means any judicial or administrative
proceedings arising from or in any way associated with any Environmental
Requirement.
8
<PAGE>
"Environmental Releases" means releases as defined in CERCLA or under
any applicable state or local environmental law or regulation.
"Environmental Requirements" means any legal requirement relating to
health, safety or the environment and applicable to the Parent, any Consolidated
Subsidiary or the Properties, including but not limited to any such requirement
under CERCLA or similar state legislation and all federal, state and local laws,
ordinances, regulations, orders, writs, decrees and common law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, or any successor law. Any reference to any provision
of ERISA shall also be deemed to be a reference to any successor provision or
provisions thereof.
"Euro-Dollar Business Day" means any Domestic Business Day on which
dealings in Dollar deposits are carried out in the London interbank market.
"Euro-Dollar Loan" means a Loan to be made as a Euro-Dollar Loan
pursuant to the applicable Notice of Borrowing.
"Euro-Dollar Reserve Percentage" has the meaning set forth in Section
2.06(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the next higher 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if the day for which such rate is to
be determined is not a Domestic Business Day, the Federal Funds Rate for such
day shall be such rate on such transactions on the next preceding Domestic
Business Day as so published on the next succeeding Domestic Business Day, and
(ii) if such rate is not so published for any day, the Federal Funds Rate for
such day shall be the average rate charged to the Agent on such day on such
transactions, as determined by the Agent.
"Fiscal Quarter" means any fiscal quarter of the Parent.
"Fiscal Year" means any fiscal year of the Parent.
9
<PAGE>
"Fixed Charge Coverage Ratio" means the ratio of (i) Income Available
for Fixed Charges to (ii) Consolidated Fixed Charges.
"Fixed Rate Borrowing" means a Euro-Dollar Borrowing or a Money Market
Borrowing, or both of them, as the context shall require.
"Fixed Rate Loans" means Euro-Dollar Loans, Money Market Loans, or any
or all of them, as the context shall require.
"Foreign Currencies" means, individually and collectively, as the
context shall require, each of the following, if offered and subject to
availability: (i) Australian dollars, Austrian schillings, Belgium francs,
British pounds sterling, Canadian dollars, Danish kroner, Dutch guilders,
European Currency Units, Finnish markkas, French francs, German deutche marks,
Greek drachmas, Hong Kong dollars, Irish pounds, Italian lira, Japanese yen, New
Zealand dollars, Norwegian kroner, Portuguese escudos, Singaporean dollars,
Spanish pesetas, Swedish kroner and Swiss francs; and (ii) at the option of the
Banks, any other currency which is freely transferable and convertible into
Dollars; provided, however, that no such other currency under this clause (ii)
-------- -------
shall be included as a Foreign Currency hereunder, or included in a Notice of
Borrowing, unless (x) a Borrower has first submitted a request to the Agent and
the Banks that it be so included, and (y) the Agent and the Banks, in their sole
discretion, have agreed to such request.
"Foreign Currency Business Day" shall mean any Domestic Business Day,
excluding one on which trading is not carried on by and between banks in
deposits of the applicable Foreign Currency in the applicable interbank market
for such Foreign Currency.
"Foreign Currency Money Market Borrowing" has the meaning set forth in
the definition of "Borrowing."
"Foreign Currency Money Market Loan" means a Money Market Loan made in
a Foreign Currency.
"Foreign Currency Money Market Loan Notes" means the promissory notes
of the Borrower, substantially in the form of Exhibit A-3, evidencing the
-----------
obligation of the Borrower to repay the Foreign Currency Money Market Loans,
together with all amendments, consolidations, modifications, renewals and
supplements thereto.
"GAAP" means generally accepted accounting principles applied on a
basis consistent with those which, in accordance
10
<PAGE>
with Section 1.02, are to be used in making the calculations for purposes of
determining compliance with the terms of this Agreement.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to secure, purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation (whether arising by virtue
of partnership arrangements, by agreement to keep-well, to purchase assets,
goods, securities or services, to provide collateral security, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part), provided that the term Guarantee shall
--------
not include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.
"Hazardous Materials" includes, without limitation, (a) solid or
hazardous waste, as defined in the Resource Conservation and Recovery Act of
1980, 42 U.S.C. (S) 6901 et seq. and its implementing regulations and
amendments, or in any applicable state or local law or regulation, (b)
"hazardous substance", "pollutant", or "contaminant" as defined in CERCLA, or in
any applicable state or local law or regulation, (c) gasoline, or any other
petroleum product or by-product, including, crude oil or any fraction thereof
(d) toxic substances, as defined in the Toxic Substances Control Act of 19 in
any applicable state or local law or regulation or (e) insecticides, fungicides,
or rodenticides, as defined in the Federal Insecticide, Fungicide, and
Rodenticide Act of 1975, or in any applicable state or local law or regulation,
as each such Act, statute or regulation may be amended from time to time.
"IBOR" has the meaning set forth in Section 2.06(d).
"Income Available for Fixed Charges" for any period means the sum of
(i) Consolidated Net Income, (ii) taxes on income and (iii) Consolidated Fixed
Charges, all determined with respect to the Parent and its Consolidated
Subsidiaries on a consolidated basis for such period and in accordance with
GAAP.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing and Foreign Currency Money Market Borrowing, subject to paragraph (c)
below, the period commencing
11
<PAGE>
on the date of such Borrowing and ending on the numerically corresponding day in
the first, second, third or sixth month thereafter, as the Borrower may elect in
the applicable Notice of Borrowing; provided that:
--------
(a) any Interest Period which would otherwise end on a day which is
not a Euro-Dollar Business Day or Foreign Currency Business Day, as the
case may be, shall be extended to the next succeeding Euro-Dollar Business
Day or Foreign Currency Business Day, as the case may be, unless such Euro-
Dollar Business Day or Foreign Currency Business Day, as the case may be,
falls in another calendar month, in which case such Interest Period shall,
subject to paragraph (c) below end on the next preceding Euro-Dollar
Business Day or Foreign Currency Business Day, as the case may be;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day or Foreign Currency Business Day, as the case may be, of a calendar
month (or on a day for which there is no numerically corresponding day in
the appropriate subsequent calendar month) shall end on the last Euro-
Dollar Business Day or Foreign Currency Business Day, as the case may be,
of the appropriate subsequent calendar month; and
(c) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
(2) with respect to each Base Rate Borrowing, the period commencing on the date
of such Borrowing and ending 30 days thereafter; provided that:
--------
(a) any Interest Period which would otherwise end on a day which is
not a Domestic Business Day shall be extended to the next succeeding
Domestic Business Day; and
(b) no Interest Period which begins before the Termination Date and
would otherwise end after the Termination Date may be selected.
(3) with respect to each Dollar Money Market Borrowing, the period commencing on
the date of such Borrowing and ending on the Stated Maturity Date or such other
date or dates as may be specified in the applicable Money Market Quote; provided
--------
that:
(a) any Interest Period (subject to clause (b) below) which would
otherwise end on a day which is not a Domestic Business Day shall be
extended to the next succeeding Domestic Business Day; and
12
<PAGE>
(b) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
(4) with respect to each Foreign Currency Money Market Borrowing, the period
commencing on the date of such Borrowing and ending on the Stated Maturity Date
or such other date or dates as may be specified in the applicable Money Market
Quote; provided that:
--------
(a) any Interest Period (subject to clause (b) below) which would
otherwise end on a day which is not a Foreign Currency Business Day shall
be extended to the next succeeding Foreign Currency Business Day; and
(b) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
"Investment" means any investment in any Person, whether by means of
purchase or acquisition of obligations or securities of such Person, capital
contribution to such Person, loan or advance to such Person, making of a time
deposit with such Person, Guarantee or assumption of any obligation of such
Person or otherwise.
"Investment Guidelines" means the guidelines for investment of funds
of the Parent and the Subsidiaries as approved by the Board of Directors of the
Parent or an authorized executive committee thereof and in effect on the Closing
Date, a copy of which has been furnished to the Banks, as modified from time to
time with the approval of the Board of Directors of the Parent or an authorized
executive committee with notification to the Banks.
"Lending Office" means, as to each Bank, its office located at its
address set forth on the signature pages hereof (or identified on the signature
pages hereof as its Lending Office) or such other office as such Bank may
hereafter designate as its Lending Office by notice to the Borrower and the
Agent. Each Bank may designate a Lending Office for Syndicated Loans and a
different Lending Office for Foreign Currency Money Market Loans, and the term
"Lending Office" shall in such case mean either such Lending Office, as the
context shall require.
"Lien" means, with respect to any asset, any mortgage, deed to secure
debt, deed of trust, lien, pledge, charge, security interest, security title,
preferential arrangement which has the practical effect of constituting a
security interest or encumbrance, or encumbrance or servitude of any kind in
respect of such asset to secure or assure payment of a Debt or a
13
<PAGE>
Guarantee, whether by consensual agreement or by operation of statute or other
law, or by any agreement, contingent or otherwise, to provide any of the
foregoing. For the purposes of this Agreement, the Borrower or any Consolidated
Subsidiary shall be deemed to own subject to a Lien any asset which 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
(other than an operating lease under GAAP) relating to such asset.
"Loan" means a Base Rate Loan, Euro-Dollar Loan, Money Market Loan,
Dollar Money Market Loan, Foreign Currency Money Market Loan, Domestic Loan or
Syndicated Loan, and "Loans" means Base Rate Loans, Euro-Dollar Loans, Money
Market Loans, Dollar Money Market Loans, Foreign Currency Money Market Loans,
Domestic Loans or Syndicated Loans, or any or all of them, as the context shall
require.
"Loan Documents" means this Agreement, the Notes, the Parent Guaranty
any other document evidencing, relating to or securing the Loans, and any other
document or instrument delivered from time to time in connection with this
Agreement, the Notes, the Parent Guaranty or the Loans, as such documents and
instruments may be amended or supplemented from time to time.
"London Interbank Offered Rate" has the meaning set forth in Section
2.06(c).
"Long-Term Debt" means at any date any Consolidated Debt which matures
(or the maturity of which may at the option of the Parent or any Consolidated
Subsidiary be extended such that it matures) more than one year after such date.
"Margin Stock" means "margin stock" as defined in Regulations G, T, U
or X.
"Material Adverse Effect" means, with respect to any event, act,
condition or occurrence of whatever nature (including any adverse determination
in any litigation, arbitration, or governmental investigation or proceeding),
whether singly or in conjunction with any other event or events, act or acts,
condition or conditions, occurrence or occurrences, whether or not related, a
material adverse change in, or a material adverse effect upon, any of (a) the
financial condition, operations, business, properties or prospects of the Parent
and its Consolidated Subsidiaries taken as a whole, (b) the rights and remedies
of the Agent or the Banks under the Loan Documents, or the ability of the Parent
and its Consolidated Subsidiaries taken as a whole to perform its obligations
under the Loan Documents to
14
<PAGE>
which it is a party, as applicable, or (c) the legality, validity or
enforceability of any Loan Document.
"Money Market Borrowing Date" has the meaning specified in Section
2.03.
"Money Market Loans" means Loans made pursuant to the terms and
conditions set forth in Section 2.03.
"Money Market Quote" has the meaning specified in Section 2.03.
"Money Market Quote Request" has the meaning specified in Section
2.03(b).
"Money Market Rate" has the meaning specified in Section
2.03(c)(ii)(C).
"Multiemployer Plan" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"Net Funded Debt" of any Person shall mean the sum of (i) all Debt of
such Person regardless of the maturity thereof, less (ii) cash and cash
----
equivalents.
"Net Income" means, as applied to any Person for any period, the
aggregate amount of net income of such Person, after taxes, for such period, as
determined in accordance with GAAP.
"Notes" means the Syndicated Loan Notes, the Dollar Money Market Loan
Notes, the Foreign Currency Money Market Loan Notes, or any or all of them, as
the context shall require.
"Notice of Borrowing" has the meaning set forth in Section 2.02(a).
"Operating Profits" means, as applied to any Person for any period,
the operating revenue of such Person for such period, minus its costs of
services for such period, and minus its selling, general and administrative
costs for such period, but excluding therefrom all extraordinary gains or
losses, as determined in accordance with GAAP.
"Parent" means Equifax Inc., a Georgia corporation, and its successors
and permitted assigns.
"Parent Guaranty" means the Guaranty Agreement dated as of even date
herewith substantially in the form of Exhibit J, executed by Parent in favor of
---------
the Agent, for the benefit of the Banks, unconditionally Guaranteeing the
payment of all
15
<PAGE>
obligations of the other Borrowers hereunder, under the Notes and under the
other Loan Documents executed by them.
"Participant" has the meaning set forth in Section 9.08(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Performance Pricing Determination Date" has the meaning set forth in
Section 2.06(a).
"Person" means an individual, a corporation, a partnership, an
unincorporated association, a trust or any other entity or organization,
including, but not limited to, a government or political subdivision or an
agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan which is
covered by Title IV of ERISA or subject to the minimum funding standards under
Section 412 of the Code and is either (i) maintained by a member of the
Controlled Group for employees of any member of the Controlled Group or (ii)
maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which
a member of the Controlled Group is then making or accruing an obligation to
make contributions or has within the preceding 5 plan years made contributions.
"Prime Rate" refers to that interest rate so denominated and set by
Wachovia from time to time as an interest rate basis for borrowings. The Prime
Rate is but one of several interest rate bases used by Wachovia. Wachovia lends
at interest rates above and below the Prime Rate.
"Principal Officer" means any of the Authorized Officers or the
General Counsel of the Parent.
"Properties" means all real property owned, leased or otherwise used
or occupied by any Borrower or any Consolidated Subsidiary, wherever located.
"Redeemable Preferred Stock" of any Person means any preferred stock
issued by such Person which is at any time prior to the Termination Date either
(i) mandatorily redeemable (by sinking fund or similar payments or otherwise) or
(ii) redeemable at the option of the holder thereof.
16
<PAGE>
"Refunding Loan" means a new Syndicated Loan made on the day on which
an outstanding Syndicated Loan is maturing or a Base Rate Borrowing is being
converted to a Fixed Rate Borrowing, if and to the extent that the proceeds
thereof are used entirely for the purpose of paying such maturing Loan or Loan
being converted, excluding any difference between the amount of such maturing
Loan or Loan being converted and any greater amount being borrowed on such day
and actually either being made available to the Borrower pursuant to Section
2.02(c) or remitted to the Agent as provided in Section 2.12, in each case as
contemplated in Section 2.02(d).
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation G" means Regulation G of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation T" means Regulation T of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation X" means Regulation X of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Reported Net Income" means, for any period, the Net Income of the
Parent and its Consolidated Subsidiaries determined on a consolidated basis.
"Required Banks" means at any time Banks having at least 66 2/3% of
the Aggregate Commitments or, if the Commitments are no longer in effect, Banks
holding at least 66 2/3% of the Aggregate Outstanding Loans.
"Restricted Investments" means Investments in joint ventures and in
Subsidiaries of the Parent which are not Consolidated Subsidiaries. Restricted
Investments shall not include Investments made in the acquisition of a Person
which
17
<PAGE>
becomes a Consolidated Subsidiary upon the closing of such acquisition.
"Reuters Screen" means, when used in connection with any designated
page and the London Interbank Offered Rate, the display page so designated on
the Reuter Monitor Money Rates Service (or such other page as may replace that
page on that service for the purpose of displaying rates comparable to the
London Interbank Offered Rate).
"Stated Maturity Date" means, with respect to any Money Market Loan,
the Stated Maturity Date therefor specified by the Bank in the applicable Money
Market Quote.
"Subsidiaries' Assets and Liabilities" has the meaning set forth in
the CSC Agreement.
"Subsidiary" means any corporation or other entity of which securities
or other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at the
time directly or indirectly owned by the Parent.
"Syndicated Borrowing" has the meaning set forth in the definition of
"Borrowing."
"Syndicated Loan Notes" means promissory notes of the Borrower,
substantially in the form of Exhibit "A-1", evidencing the obligation of the
-------------
Borrower to repay the Syndicated Loans, together with all amendments,
consolidations, modifications, renewals, and supplements thereto.
"Syndicated Loans" means Loans made pursuant to Section 2.01 in
Dollars, which shall be either a Base Rate Loan or a Euro-Dollar Loan.
"Taxes" has the meaning set forth in Section 2.12(c).
"Telerate" means, when used in connection with any designated page and
IBOR, the display page so designated on the Dow Jones Telerate Service (or such
other page as may replace that page on that service for the purpose of
displaying rates comparable to IBOR).
"Termination Date" means June August 1, 2000.
"Third Parties" means all lessees, sublessees, licensees and other
users of the Properties, excluding those users of the Properties in the ordinary
course of the Borrower's business and on a temporary basis.
18
<PAGE>
"Transferee" has the meaning set forth in Section 9.08(d).
"Unused Commitment" means at any date, with respect to any Bank, an
amount equal to its Commitment less the aggregate outstanding principal amount
of its Syndicated Loans.
"Wachovia" means Wachovia Bank of Georgia, N.A., a national banking
association, and its successors.
"Wholly Owned Subsidiary" means any Subsidiary all of the shares of
capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the Parent.
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
-----------------------------------
specified herein, all terms of an accounting character used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared, in
accordance with GAAP, applied on a basis consistent (except for changes
concurred in by the Parent's and its Consolidated Subsidiaries' independent
public accountants or otherwise required by a change in GAAP) with the most
recent audited consolidated financial statements of the Parent and its
Consolidated Subsidiaries delivered to the Banks, unless with respect to any
such change concurred in by the Parent's independent public accountants or
required by GAAP in determining compliance with any of the provisions of this
Agreement or any of the other Loan Documents: (i) the Parent shall have objected
to determining such compliance on such basis at the time of delivery of such
financial statements, or (ii) the Required Banks shall so object in writing
within 30 days after the delivery of such financial statements, in either of
which events such calculations shall be made on a basis consistent with those
used in the preparation of the latest financial statements as to which such
objection shall not have been made (which, if objection is made in respect of
the first financial statements delivered under Section 5.01 hereof, shall mean
the financial statements referred to in Section 4.04).
SECTION 1.03. References. Unless otherwise indicated, references in
----------
this Agreement to "Articles", "Exhibits", "Schedules", "Sections" and other
Subdivisions are references to articles, exhibits, schedules, sections and other
subdivisions hereof.
SECTION 1.04. Use of Defined Terms. All terms defined in this
--------------------
Agreement shall have the same defined meanings when used
19
<PAGE>
in any of the other Loan Documents, unless otherwise defined therein or unless
the context shall require otherwise.
SECTION 1.05. Terminology. All personal pronouns used in this
-----------
Agreement, whether used in the masculine, feminine or neuter gender, shall
include all other genders; the singular shall include the plural, and the plural
shall include the singular. Titles of Articles and Sections in this Agreement
are for convenience only, and neither limit nor amplify the provisions of this
Agreement. As used in this Agreement and in any certificate delivered pursuant
to Sections 3.01, 3.02 and 5.01, "knowledge" and "becomes aware" or words of
similar meaning shall mean, with respect to the Parent, any Borrower or
Subsidiary, that a Principal Officer (i) has actual knowledge of such matters,
or (ii) from all the facts and circumstances actually known to him at the time
in question he has reason to know such matters exist.
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend Syndicated Loans. (a) Each Bank
------------------------------------
severally agrees, on the terms and conditions set forth herein, to make Loans
(which may be, at the option of the Borrowers and subject to the terms and
conditions hereof, Syndicated Loans consisting of Base Rate Loans or Euro-Dollar
Loans) to any of the Borrowers described in clause (i) of the definition of
"Borrower" from time to time before the Termination Date; provided that,
--------
(i) immediately after each such Loan is made, the sum of the aggregate
principal amount of the Syndicated Loans by such Bank shall not exceed the
amount of its Commitment, and
(ii) the Aggregate Outstanding Loans shall not exceed the Aggregate
Commitments, as determined pursuant to Section 2.01(b).
Each Syndicated Borrowing under this Section shall be in an aggregate principal
amount of $5,000,000 or any larger multiple of $1,000,000 (except that any such
Syndicated Borrowing may be in the aggregate amount of the Unused Commitments)
and shall be made from the several Banks ratably in proportion to their
respective Commitments. Within the foregoing limits, the Borrower may borrow
under this Section, repay or, to the extent
20
<PAGE>
permitted by Section 2.10, prepay Syndicated Loans and reborrow under this
Section at any time before the Termination Date.
(b) The Dollar Equivalent of each Foreign Currency Money Market Loan on the
date each Foreign Currency Money Market Loan is disbursed pursuant to Section
2.03 shall be deemed to be the amount of such Foreign Currency Money Market Loan
outstanding for the purpose of calculating the aggregate principal amount of the
Foreign Currency Money Market Loans on the date of disbursement for purposes of
clause (ii) of Section 2.01(a) and clause (ii) of Section 2.03(a); provided,
--------
however, that if at the time of receipt of any Notice of Borrowing or Money
- -------
Market Quote Request, the Aggregate Outstanding Loans is equal to or greater
than 50% of the Aggregate Commitments, then the Dollar Equivalent of each
Foreign Currency Money Market Loan shall be calculated as of such date, rather
than as of the date such Foreign Currency Money Market Loans were disbursed, and
in the event that, as a result of such calculation, the Aggregate Outstanding
Loans exceeds the Aggregate Commitments, then (i) no additional Borrowings shall
be permitted and (ii) the Foreign Currency Money Market Loans shall be subject
to mandatory repayment pursuant to the provisions of Section 2.11(b).
SECTION 2.02. Method of Borrowing. (a) The Borrower shall give the
-------------------
Agent notice (a "Notice of Borrowing"), which shall be substantially in the form
of Exhibit E, prior to 10:30 A.M. (Atlanta, Georgia time), on the same Domestic
---------
Business Day as each Base Rate Borrowing and at least 2 Euro-Dollar Business
Days before each Euro-Dollar Borrowing, specifying:
(i) the date of such Syndicated Borrowing, which shall be a Domestic
Business Day in the case of a Domestic Borrowing or a Euro-Dollar Business
Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Syndicated Borrowing,
(iii) whether the Syndicated Loans comprising such Borrowing are to be
Base Rate Loans or Euro-Dollar Loans, and
(iv) in the case of a Fixed Rate Borrowing, the duration of the
Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent shall promptly notify
each Bank of the contents thereof and of such Bank's ratable share of such
Borrowing and such Notice of Borrowing, once received by the Agent, shall not
thereafter be revocable by the Borrower.
21
<PAGE>
(c) Not later than 11:00 A.M. (Atlanta, Georgia time) on the date of each
Syndicated Borrowing, each Bank shall (except as provided in paragraph (d) of
this Section) make available its ratable share of such Syndicated Borrowing, in
Federal or other funds immediately available in Atlanta, Georgia, to the Agent
at its address referred to in Section 9.01. Unless the Agent determines that any
applicable condition specified in Article III has not been satisfied, the Agent
will make the funds so received from the Banks available to the Borrower at the
Agent's aforesaid address. Unless the Agent receives notice from a Bank, at the
Agent's address referred to in or specified pursuant to Section 9.01, no later
than 4:00 P.M. (local time at such address) on the Domestic Business Day before
the date of a Syndicated Borrowing stating that such Bank will not make a Loan
in connection with such Syndicated Borrowing, the Agent shall be entitled to
assume that such Bank will make a Loan in connection with such Syndicated
Borrowing and, in reliance on such assumption, the Agent may (but shall not be
obligated to) make available such Bank's ratable share of such Syndicated
Borrowing to the Borrower for the account of such Bank. If the Agent makes such
Bank's ratable share available to the Borrower and such Bank does not in fact
make its ratable share of such Syndicated Borrowing available on such date, the
Agent shall be entitled to recover such Bank's ratable share from such Bank or
the Borrower (and for such purpose shall be entitled to charge such amount to
any account of the Borrower maintained with the Agent), together with interest
thereon for each day during the period from the date of such Syndicated
Borrowing until such sum shall be paid in full at a rate per annum equal to the
rate at which the Agent determines that it obtained (or could have obtained)
overnight Federal funds to cover such amount for each such day during such
period, provided that (i) any such payment by the Borrower of such Bank's
--------
ratable share and interest thereon shall be without prejudice to any rights that
the Borrower may have against such Bank and (ii) until such Bank has paid its
ratable share of such Syndicated Borrowing, together with interest pursuant to
the foregoing, it will have no interest in or rights with respect to such
Syndicated Borrowing for any purpose hereunder. If the Agent does not exercise
its option to advance funds for the account of such Bank, it shall forthwith
notify the Borrower of such decision.
(d) If any Bank makes a new Syndicated Loan hereunder on a day on which the
Borrower is to repay all or any part of an outstanding Syndicated Loan from such
Bank, such Bank shall apply the proceeds of its new Syndicated Loan to make such
repayment as a Refunding Loan and only an amount equal to the difference (if
any) between the amount being borrowed and the amount of such Refunding Loan
shall be made available by such Bank to the Agent as provided in paragraph (c)
of this Section, or remitted by the
22
<PAGE>
Borrower to the Agent as provided in Section 2.12, as the case may be.
(e) Notwithstanding anything to the contrary contained in this Agreement,
no Fixed Rate Borrowing may be made if there shall have occurred a Default or an
Event of Default, which Default or Event of Default shall not have been cured or
waived, and in such case all Refunding Loans shall be made as Base Rate Loans
(but shall bear interest at the Default Rate, if applicable).
(f) In the event that a Notice of Borrowing fails to specify whether the
Syndicated Loans comprising such Borrowing are to be Base Rate Loans or Euro-
Dollar Loans, such Syndicated Loans shall be made as Base Rate Loans. If the
Borrower is otherwise entitled under this Agreement to repay any Syndicated
Loans maturing at the end of an Interest Period applicable thereto with the
proceeds of a new Syndicated Borrowing, and the Borrower fails to repay such
Syndicated Loans using its own moneys and fails to give a Notice of Borrowing in
connection with such new Borrowing, a new Syndicated Borrowing shall be deemed
to be made on the date such Syndicated Loans mature in an amount equal to the
principal amount of the Syndicated Loans so maturing, and the Syndicated Loans
comprising such new Syndicated Borrowing shall be Base Rate Loans.
(g) Notwithstanding anything to the contrary contained herein, there shall
not be more than 9 interest rates (including the Applicable Margins) applicable
to the Fixed Rate Loans at any given time.
SECTION 2.03. Money Market Loans. (a) In addition to making
------------------
Syndicated Borrowings, a Borrower described in clause (ii) of the definition of
"Borrower" may, through the Parent, as set forth in this Section 2.03, request
the Banks to make offers to make Money Market Borrowings available to such
Borrower, which may be Dollar Money Market Borrowings or Foreign Currency Money
Market Borrowings. The Banks may, but shall have no obligation to, make such
offers and the Borrower may, but shall have no obligation to, accept any such
offers in the manner set forth in this Section 2.03, provided that:
--------
(i) the number of interest rates applicable to Money Market Loans
which may be outstanding at any given time is subject to the provisions of
Section 2.02(g);
(ii) the Aggregate Outstanding Loans shall not exceed the Aggregate
Commitments at such time, calculated as provided in Section 2.01(b); and
23
<PAGE>
(iii) the Money Market Loans of any Bank will be deemed to be usage of
the Commitments for the purpose of calculating availability pursuant to
Section 2.01(a)(ii) and 2.03(a)(ii) and fees pursuant to Section 2.07, but
will not reduce such Bank's obligation to lend its pro rata share of the
remaining Unused Commitment.
(b) When a Borrower wishes to request offers to make Money Market Loans,
the Parent (on behalf of such Borrower) shall give the Agent (which shall
promptly notify the Banks) notice substantially in the form of Exhibit H hereto
---------
(a "Money Market Quote Request") so as to be received no later than 9:30 A.M.
(Atlanta, Georgia time) at least 4 Domestic Business Days (with respect to
Dollar Money Market Borrowings) or 4 Foreign Currency Business Days (with
respect to Foreign Currency Money Market Loans) prior to the date of the Money
Market Borrowing proposed therein (or such other time and date as the Borrower
and the Agent, with the consent of the Required Banks, may agree), specifying:
(i) the identity of the Borrower, whether such Money Market Borrowing
is to be a Dollar Money Market Borrowing or a Foreign Currency Money Market
Borrowing, and if the latter, specifying the Foreign Currency of such
Foreign Currency Money Market Borrowing, together with the proposed date of
such Money Market Borrowing, which shall be (x) with respect to a Dollar
Money Market Borrowing, a Domestic Business Day and (y) with respect to a
Foreign Currency Money Market Borrowing, a Foreign Currency Business Day
(the "Money Market Borrowing Date");
(ii) the maturity date (or dates) (each a "Stated Maturity Date") for
repayment of each Money Market Loan to be made as part of such Money Market
Borrowing (which Stated Maturity Date shall be that date occurring (x) with
respect to a Dollar Money Market Borrowing, not less than 7 days but not
greater than 185 days from the date of such Money Market Borrowing and (y)
with respect to a Foreign Currency Money Market Borrowing, not less than 7
days but not greater than 60 days from the date of such Money Market
Borrowing); provided that the Stated Maturity Date for any Money Market
--------
Loan may not extend beyond the Termination Date (as in effect on the date
of such Money Market Quote Request); and
(iii) the aggregate amount of principal to be requested by the
Borrower as a result of such Money Market Borrowing, which shall be at
least (x) with respect to Dollar Money Market Loans, $5,000,000 (and in
larger integral multiples of $1,000,000 and (y) with respect to Foreign
Currency Money Market Loans, the Dollar Equivalent of $1,000,000 (and in
24
<PAGE>
larger integral multiples of the Dollar Equivalent of $500,000), but in
each case shall not cause the limits specified in Section 2.03(a) to be
violated.
The Parent (on behalf of such Borrower) may request offers to make Money Market
Loans having up to 2 different Stated Maturity Dates in a single Money Market
Quote Request; provided that the request for each separate Stated Maturity Date
--------
shall be deemed to be a separate Money Market Quote Request for a separate Money
Market Borrowing. Except as otherwise provided in the immediately preceding
sentence, after the first Money Market Quote Request has been given hereunder,
no Money Market Quote Request shall be given until at least 3 Domestic Business
Days after the Agent has notified the applicable Banks pursuant to the first
sentence of Section 2.03(e).
(c) (i) Each Bank may, but shall have no obligation to, submit a response
containing an offer to make a Money Market Loan substantially in the form of
Exhibit I hereto (a "Money Market Quote") in response to any Money Market Quote
- ---------
Request; provided that, if the Borrower's request under Section 2.03(b)
--------
specified more than 1 Stated Maturity Date, such Bank may, but shall have no
obligation to, make a single submission containing a separate offer for each
such Stated Maturity Date and each such separate offer shall be deemed to be a
separate Money Market Quote. Each Money Market Quote must be submitted to the
Agent not later than 9:30 A.M. (Atlanta, Georgia time) 2 Domestic Business Days
prior to the Money Market Borrowing Date; provided that any Money Market Quote
--------
submitted by Wachovia may be submitted, and may only be submitted, if Wachovia
notifies the Borrower of the terms of the offer contained therein not later than
9:15 A.M. (Atlanta, Georgia time) 2 Domestic Business Days prior to the Money
Market Borrowing Date (or 15 minutes prior to the time that the other Banks must
have submitted their respective Money Market Quotes). Subject to Section 6.01,
any Money Market Quote so made shall be irrevocable except with the written
consent of the Agent given on the instructions of the Borrower.
(ii) Each Money Market Quote shall specify:
(A) the proposed Money Market Borrowing Date and the Stated
Maturity Date therefor;
(B) the principal amounts of the Money Market Loan which the
quoting Bank is willing to make for the applicable Money Market
Quote, which principal amounts: (x) may be greater than or less
than the Commitment of the quoting Bank; (y) shall be at least
(A) with respect to a Dollar Money Market Borrowing, $5,000,000
or a larger integral
25
<PAGE>
multiple of $1,000,000, and (B) with respect to a Foreign Currency
Money Market Borrowing, the Dollar Equivalent of $1,000,000 or a
larger integral multiple of the Dollar Equivalent of $500,000; and (z)
may not exceed the principal amount of the Money Market Borrowing for
which offers were requested;
(C) the rate of interest per annum (rounded upwards, if
necessary, to the nearest 1/100th of 1%) offered for each such Money
Market Loan (which in the case of a Foreign Currency Money Market Loan
shall consist of a margin over the Adjusted IBOR Rate as determined by
the Agent as set forth in Section 2.03(e) (which margin shall include
any applicable withholding taxes), such rate being hereinafter
referred to as the "Money Market Rate"); and
(D) the identity of the quoting Bank.
Unless otherwise agreed by the Agent and the Borrower, no Money Market
Quote shall contain qualifying, conditional or similar language or propose
terms other than or in addition to those set forth in the applicable Money
Market Quote Request (other than setting forth the maximum principal
amounts of the Money Market Loan which the quoting Bank is willing to make
for the applicable Interest Period) and, in particular, no Money Market
Quote may be conditioned upon acceptance by the Borrower of all (or some
specified minimum) of the principal amount of the Money Market Loan for
which such Money Market Quote is being made.
(d) The Agent shall as promptly as practicable after the Money Market
Quote is submitted (but in any event not later than 10:00 A.M. (Atlanta, Georgia
time)) 2 Domestic Business Days prior to the Money Market Borrowing Date, notify
the Parent (on behalf of such Borrower) of the terms (i) of any Money Market
Quote submitted by a Bank that is in accordance with Section 2.03(c) and (ii) of
any Money Market Quote that amends, modifies or is otherwise inconsistent with a
previous Money Market Quote submitted by such Bank with respect to the same
Money Market Quote Request. Any such subsequent Money Market Quote shall be
disregarded by the Agent unless such subsequent Money Market Quote is submitted
solely to correct a manifest error in such former Money Market Quote. The
Agent's notice to the Parent shall specify (A) the principal amounts of the
Money Market Borrowing for which offers have been received and (B) the
respective principal amounts and Money Market Rates so offered by
26
<PAGE>
each Bank (identifying the Bank that made each Money Market Quote).
(e) Not later than 10:30 A.M. (Atlanta, Georgia time) 2 Domestic
Business Days prior to the Money Market Borrowing Date, the Parent (on behalf of
such Borrower) shall notify the Agent of the Borrower's acceptance or
nonacceptance of the offers so notified to it pursuant to Section 2.03(d) and
the Agent shall promptly notify each affected Bank. In the case of acceptance,
such notice shall specify the aggregate principal amount of offers (for each
Stated Maturity Date) that are accepted and the Adjusted IBOR Rate determined by
the Agent for the purposes thereof. The Parent (on behalf of such Borrower) may
accept any Money Market Quote in whole or in part; provided that:
--------
(i) the aggregate principal amount of each Money Market Borrowing may
not exceed the applicable amount set forth in the related Money Market
Quote Request;
(ii) the aggregate principal amount of each Money Market Loan
comprising a Money Market Borrowing shall be at least (x) with respect to a
Dollar Money Market Borrowing, 5,000,000 (and in larger multiples of
$1,000,000) and (y) with respect to a Foreign Currency Money Market
Borrowing, the Dollar Equivalent of $1,000,000 (and in larger multiples of
the Dollar Equivalent of $500,000), but in each case shall not cause the
limits specified in Section 2.03(a) to be violated;
(iii) acceptance of offers may only be made in ascending order of
Money Market Rates; and
(iv) the Parent (on behalf of such Borrower) may not accept any offer
where the Agent has advised the Borrower that such offer fails to comply
with Section 2.03(c)(ii) or otherwise fails to comply with the requirements
of this Agreement (including without limitation, Section 2.03(a)).
If offers are made by 2 or more Banks with the same Money Market Rates for a
greater aggregate principal amount than the amount in respect of which offers
are accepted for the related Stated Maturity Date, the principal amount of Money
Market Loans in respect of which such offers are accepted shall be allocated by
the Parent (on behalf of such Borrower) among such Banks as nearly as possible
in proportion to the aggregate principal amount of such offers. Determinations
by the Parent (on behalf of such Borrower) of the amounts of Money Market Loans
shall be conclusive in the absence of manifest error.
27
<PAGE>
(f) Any Bank whose offer to make any Money Market Loan has been
accepted shall, not later than 12:00 P.M. (Atlanta, Georgia time) on the Money
Market Borrowing Date, make the appropriate amount of such Money Market Loan
available to the Agent at its address referred to in Section 9.01 in immediately
available funds. The amount so received by the Agent shall, subject to the
terms and conditions of this Agreement, be made available to the Borrower on
such date by depositing the same, in immediately available funds, not later than
4:00 P.M. (Atlanta, Georgia time), in an account of such Borrower maintained
with Wachovia.
(g) After any Money Market Loan has been funded, the Agent shall
notify the Banks of the aggregate principal amount of the Money Market Quotes
received and the highest and lowest rates included in such Money Market Quotes.
SECTION 2.04. Notes. (a) The Syndicated Loans of each Bank shall be
-----
evidenced by a single Syndicated Loan Note from each Borrower described in
clause (i) of the definition of "Borrower" payable to the order of such Bank for
the account of its Lending Office in an amount equal to the original principal
amount of such Bank's Commitment.
(b) The Money Market Loans made by any Bank shall be evidenced by a
single Dollar Money Market Loan Note from each Borrower and a single Foreign
Currency Money Market Loan Note from each Borrower, as each is described in
clause (ii) of the definition of "Borrower", each payable to the order of such
Bank for the account of its Lending Office.
(c) Upon receipt of each Bank's Notes pursuant to Section 3.01, the
Agent shall deliver such Notes to such Bank. Each Bank shall record, and prior
to any transfer of its Notes shall endorse on the schedules forming a part
thereof appropriate notations to evidence, where applicable, the date, amount
and maturity of, and effective interest rate for, each Loan made by it, the date
and amount of each payment of principal made by the Borrower with respect
thereto, whether such Loan is a Base Rate Loan, Euro-Dollar Loan or Foreign
Currency Money Market Loan, and if a Foreign Currency Money Market Loan, a
specification of the Foreign Currency, and such schedules of each such Bank's
Notes shall constitute rebuttable presumptive evidence of the principal amounts
owing and unpaid on such Bank's Notes; provided that the failure of any Bank to
--------
make any such recordation or endorsement shall not affect the obligation of the
Borrower hereunder or under the Notes or the ability of any Bank to assign its
Notes. Each Bank is hereby irrevocably authorized by the Borrower so to endorse
its Notes and to attach to and make a part of any Note a continuation of any
such schedule as and when required.
28
<PAGE>
SECTION 2.05. Maturity of Loans. (a) Each Loan included in any
-----------------
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing.
(b) Notwithstanding the foregoing, the outstanding principal amount of the
Loans, if any, together with all accrued but unpaid interest thereon, if any,
shall be due and payable on the Termination Date.
SECTION 2.06. Interest Rates. (a) "Applicable Margin" means:
--------------
(i) for the period commencing on the Closing Date to and including the
first Performance Pricing Determination Date, (x) for any Base Rate Loan, 0%
and (y) for any Euro-Dollar Loan, 0.20%; and
(ii) from and after the first Performance Pricing Determination Date, (x)
for any Base Rate Loan, 0%, and (y) for any Euro-Dollar Loan, the percentage
determined on each Performance Pricing Determination Date by reference to the
table set forth below and the Debt Rating (or if there is no Debt Rating, the
Fixed Charge Coverage Ratio) for the quarterly or annual period ending
immediately prior to such Performance Pricing Determination Date.
<TABLE>
<CAPTION>
================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Debt Rating more than A-/A3 BBB+/ BBB/ BBB-/ less than BBB-/
or equal to A/A2
Baa1 Baa2 Baa3 Baa3
-------------------------------------------------------------------------------------------------------------------------------
Fixed Charge more than less than 4.00 less than 3.50 less than 3.00 less than 2.50 N/A
Coverage Ratio or equal to 4.00 and and and and
more than more than more than more than
or equal to 3.50 or equal to 3.00 or equal to 2.50 or equal to 2.00
-------------------------------------------------------------------------------------------------------------------------------
Applicable 0.17 0.20 0.21 0.275 0.35 0.50
Margin
================================================================================================================================
</TABLE>
In determining interest for purposes of this Section 2.06 and fees for
purposes of Section 2.07, the Borrower and the Banks shall refer to the
Borrower's most recent consolidated quarterly and annual (as the case may be)
financial statements delivered pursuant to Section 5.01(a) or (b), as the case
may be. If such financial statements require a change in interest pursuant to
this Section 2.06 or fees pursuant to Section 2.07, the Borrower shall deliver
to the Agent, along with such financial statements, a notice to that effect,
which notice shall set forth in reasonable detail the calculations establishing
the required change. The "Performance Pricing Determination Date" means the
earlier of the date of any change in the Debt Rating or the date which is the
last date on which such financial statements are
29
<PAGE>
permitted to be delivered pursuant to Section 5.01(a) or (b), as applicable. Any
such required change in interest and fees shall become effective on such
Performance Pricing Determination Date, and shall be in effect until the next
Performance Pricing Determination Date, provided that: (i) for Fixed Rate Loans,
--------
changes in interest shall only be effective for Interest Periods commencing on
or after the Performance Pricing Determination Date; and (ii) no fees or
interest shall be decreased pursuant to this Section 2.06 or Section 2.07 if a
Default is in existence on the Performance Pricing Determination Date.
(b) Each Base Rate Loan shall bear interest on the outstanding principal
amount thereof, for each day from the date such Loan is made until it becomes
due, at a rate per annum equal to the Base Rate for such day plus the Applicable
Margin. Such interest shall be payable for each Interest Period on the last day
thereof. Any overdue principal of and, to the extent permitted by applicable
law, overdue interest on any Base Rate Loan shall bear interest, payable on
demand, for each day until paid at a rate per annum equal to the Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding principal
amount thereof, for the Interest Period applicable thereto, at a rate per annum
equal to the sum of the Applicable Margin plus the applicable Adjusted London
Interbank Offered Rate for such Interest Period. Such interest shall be payable
for each Interest Period on the last day thereof and, if such Interest Period is
longer than 3 months, at intervals of 3 months after the first day thereof. Any
overdue principal of and, to the extent permitted by law, overdue interest on
any Euro-Dollar Loan shall bear interest, payable on demand, for each day until
paid at a rate per annum equal to the Default Rate.
The "Adjusted London Interbank Offered Rate" applicable to any Interest
Period means a rate per annum equal to the quotient obtained (rounded upwards,
if necessary, to the next higher 1/100th of 1%) by dividing (i) the applicable
London Interbank Offered Rate for such Interest Period by (ii) 1.00 minus the
Euro-Dollar Reserve Percentage.
The "London Interbank Offered Rate" applicable to any Euro-Dollar Loan
means for the Interest Period of such Euro-Dollar Loan, the rate per annum
determined on the basis of the offered rate for deposits in Dollars of amounts
equal or comparable to the principal amount of such Euro-Dollar Loan offered for
a term comparable to such Interest Period, which rates appear on the Reuters
Screen LIBO Page effective as of 11:00 A.M., London time, 2 Euro-Dollar Business
Days prior to the first day of such Interest Period, provided that (i) if more
than one such offered rate appears on the Reuters Screen LIBO Page,
30
<PAGE>
the "London Interbank Offered Rate" will be the arithmetic average (rounded
upward, if necessary, to the next higher 1/100th of 1%) of such offered rates;
(ii) if no such offered rates appear on such page, the "London Interbank Offered
Rate" for such Interest Period will be the arithmetic average (rounded upward,
if necessary, to the next higher 1/100th of 1%) of rates quoted by not less than
2 major banks in New York City, selected by the Agent, at approximately 10:00
A.M., New York City time, 2 Euro-Dollar Business Days prior to the first day of
such Interest Period, for deposits in Dollars offered to leading European banks
for a period comparable to such Interest Period in an amount comparable to the
principal amount of such Euro-Dollar Loan.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for the Agent (as the same may be
adjusted for any other Bank in accordance with Section 8.03) in respect of
"Eurocurrency liabilities" (or in respect of any other category of liabilities
which includes deposits by reference to which the interest rate on Euro-Dollar
Loans is determined or any category of extensions of credit or other assets
which includes loans by a non-United States office of any Bank to United States
residents). The Adjusted London Interbank Offered Rate shall be adjusted
automatically on and as of the effective date of any change in the Euro-Dollar
Reserve Percentage.
(d) Each Money Market Loan shall bear interest on the outstanding principal
amount thereof, for each day from the date such Money Market Loan is made until
it becomes due, at a rate per annum equal to the applicable Money Market Rate
set forth in the relevant Money Market Quote, which, if such Money Market Loan
is a Foreign Currency Money Market Loan, shall be the Adjusted IBOR Rate plus
the margin determined by each Bank in connection with its Money Market Quote.
Such interest shall be payable on the Stated Maturity Date thereof, and, if the
Stated Maturity Date occurs more than 90 days after the date of the relevant
Money Market Loan, at intervals of 90 days after the first day thereof. Any
overdue principal of and, to the extent permitted by law, overdue interest on
any Money Market Loan shall bear interest, payable on demand, for each day until
paid at a rate per annum equal to the Default Rate.
"Adjusted IBOR Rate" means, with respect to each Foreign Currency Money
Market Loan, the sum of (i) the rate obtained by dividing (A) IBOR for such
Interest Period by (B) a percentage equal to 1 minus the then stated maximum
-----
rate (stated as a decimal) of all reserves requirements (including, without
limitation, any marginal, emergency, supplemental, special or
31
<PAGE>
other reserves) applicable to the Bank providing the Money Market Quote of the
Federal Reserve System as defined in Regulation D (or against any successor
category of liabilities as defined in Regulation D), plus (ii) if the relevant
----
Foreign Currency Money Market Loan is in British pounds sterling, a percentage
sufficient to compensate the Bank providing the Money Market Quote for the cost
of complying with any reserves, liquidity and/or special deposit requirements of
the Bank of England directly or indirectly affecting the maintenance or funding
of such Foreign Currency Money Market Loan.
"IBOR" means, with respect to each Foreign Currency Money Market Loan, the
offered rate for deposits in the applicable Foreign Currency, for a period
comparable to the Interest Period and in an amount comparable to the amount of
such Foreign Currency Money Market Loan appearing on Telerate Page 3750 (or, if
it is unavailable from Telerate for any reason, by reference to the Reuters
Screen CHFF) as of 11:00 A.M. (London, England time) on the day that is two
Foreign Currency Business Days prior to the date such Foreign Currency Money
Market Loan is made.
(e) The Agent shall determine each interest rate applicable to the Loans
hereunder. The Agent shall give prompt notice to the Borrower and the Banks by
telecopier of each rate of interest so determined, and its determination thereof
shall be conclusive in the absence of manifest error.
(f) After the occurrence and during the continuance of a Default, the
principal amount of the Loans (and, to the extent permitted by applicable law,
all accrued interest thereon) may, at the election of the Required Banks, bear
interest at the Default Rate.
SECTION 2.07. Fees. (a) The Borrower shall pay to the Agent, for the
----
ratable account of each Bank, a facility fee, calculated in the manner provided
in the last paragraph of Section 2.06(a), on the aggregate amount of such Bank's
Commitment (without taking into account the amount of the outstanding Loans made
by such Bank), at a rate per annum equal to: (i) for the period commencing on
the Closing Date to and including the first Performance Pricing Determination
Date, 0.09%; and (ii) from and after the first Performance Pricing Determination
Date, the percentage determined on each Performance Pricing Determination Date
by reference to the table set forth below and the Debt Rating (or if there is no
Debt Rating, the Fixed Charge Coverage Ratio) for the quarterly or annual period
ending immediately prior to such Performance Pricing Determination Date:
32
<PAGE>
<TABLE>
<CAPTION>
================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
more than
Debt Rating or equal to A/A2 A-/A3 BBB+/ BBB/ BBB-/ less than BBB-/
Baa1 Baa2 Baa3 Baa3
-------------------------------------------------------------------------------------------------------------------------------
Fixed Charge more than 4.00 less than 4.00 less than 3.50 less than 3.00 less than 2.50 N/A
Coverage Ratio or equal to and and and and
more than more than more than more than
or equal to 3.50 or equal to 3.00 or equal to 2.50 or equal to 2.00
-------------------------------------------------------------------------------------------------------------------------------
Facility Fee 0.08 0.09 0.11 0.125 0.175 0.25
================================================================================================================================
</TABLE>
Such facility fees shall accrue from and including the Closing Date to (but
excluding the Termination Date) and shall be payable on each March 31, June 30,
September 30 and December 31 and on the Termination Date.
(c) The Borrower shall pay to the Agent, for the account and sole
benefit of the Agent, such fees and other amounts at such times as set forth in
the Agent's Letter Agreement.
SECTION 2.08. Optional Termination or Reduction of Commitments. The
------------------------------------------------
Borrowers may, upon at least 3 Domestic Business Days' notice to the Agent,
terminate at any time, or proportionately reduce the Unused Commitments from
time to time by an aggregate amount of at least $5,000,000 or any larger
multiple of $1,000,000. If the Commitments are terminated in their entirety,
all accrued fees (as provided under Section 2.07) shall be due and payable on
the effective date of such termination.
SECTION 2.09. Mandatory Termination of Commitments. The Commitments
------------------------------------
shall terminate on the Termination Date and any Loans then outstanding (together
with accrued interest thereon) shall be due and payable on such date.
SECTION 2.10. Optional Prepayments. (a) The Borrowers may, upon at
--------------------
least 1 Domestic Business Days' notice to the Agent, prepay any Base Rate
Borrowing in whole at any time, or from time to time in part in amounts
aggregating at least $5,000,000 or any larger multiple of $1,000,000 by paying
the principal amount to be prepaid together with accrued interest thereon to the
date of prepayment. Each such optional prepayment shall be applied to prepay
ratably the Base Rate Loans of the several Banks included in such Base Rate
Borrowing.
(b) Except as provided in Section 8.02, the Borrower may not prepay all or
any portion of the principal amount of any Fixed Rate Loan prior to the end of
the applicable Interest Period thereof.
33
<PAGE>
(c) Upon receipt of a notice of prepayment pursuant to this Section 2.10,
the Agent shall promptly notify each Bank of the contents thereof and of such
Bank's ratable share of such prepayment and such notice, once received by the
Agent, shall not thereafter be revocable by the Borrower.
SECTION 2.11. Mandatory Prepayments and Repayments. (a) On each date
------------------------------------
on which the Commitments are reduced pursuant to Section 2.08, the Borrower
shall repay or prepay such principal amount of the outstanding Loans, if any
(together with interest accrued thereon), as may be necessary so that after such
repayment or prepayment the Aggregate Outstanding Loans do not exceed the
Aggregate Commitments as then reduced.
(b) If the Agent determines at any time (whether as a result of the
provisions of Section 2.01(b) or otherwise on its own initiative or at the
instance of any Bank) that the Aggregate Outstanding Loans (after converting
each Foreign Currency Money Market Loan to its Dollar Equivalent on the date of
calculation) at any time exceeds the Aggregate Commitments, then upon written
notice from the Agent, the Borrower shall repay an aggregate principal amount of
Foreign Currency Money Market Loans by at least the amount of such excess, which
repayments shall be made at the end of the current Interest Periods for the
outstanding Foreign Currency Money Market Loans, as necessary, until the full
amount of such excess has been paid. Nothing in the foregoing shall require the
Agent to make any such calculation unless expressly requested to do so by the
Required Banks, or unless required pursuant to Section 2.01(b).
(c) Each such repayment or prepayment under paragraph (a) or (b) above
shall be applied ratably to the Loans of the Banks outstanding on the date of
repayment or prepayment in the following order of priority: (i) first, to Base
Rate Loans; (ii) secondly, to Euro-Dollar Loans; and (iii) lastly, to Money
Market Loans, (and if such repayment is made under paragraph (b) above, it shall
be applied first to Foreign Currency Loans, and if such repayment or prepayment
is made under paragraph (a) above, it may be applied first to either Dollar
Money Market Loans or Foreign Currency Money Market Loans, at the option of the
Borrower.
SECTION 2.12. General Provisions as to Payments. (a) The Borrower
---------------------------------
shall make each payment of principal of, and interest on, the Loans and of fees
hereunder, not later than 11:00 A.M. (Atlanta, Georgia time) on the date when
due, in Federal or other funds (subject to paragraph (c) below with respect to
Foreign Currency Money Market Loans) immediately available in Atlanta, Georgia,
to the Agent at its address referred to in Section 9.01. The Agent will
promptly distribute
34
<PAGE>
to each Bank its ratable share of each such payment received by the Agent for
the account of the Banks.
(b) Whenever any payment of principal of, or interest on, the Domestic
Loans or of fees hereunder shall be due on a day which is not a Domestic
Business Day, the date for payment thereof shall be extended to the next
succeeding Domestic Business Day. Whenever any payment of principal of or
interest on, the Euro-Dollar Loans or the Foreign Currency Money Market Loans
shall be due on a day which is not a Euro-Dollar Business Day or Foreign
Currency Business Day, as the case may be, the date for payment thereof shall be
extended to the next succeeding Euro-Dollar Business Day or Foreign Currency
Business Day, as the case may be, unless such Euro-Dollar Business Day or
Foreign Currency Business Day, as the case may be, falls in another calendar
month, in which case the date for payment thereof shall be the next preceding
Euro-Dollar Business Day or Foreign Currency Business Day, as the case may be.
(c) All payments of principal and interest with respect to Foreign Currency
Money Market Loans shall be made in the Foreign Currency in which the related
Foreign Currency Money Market Loan was made.
(d) All payments of principal, interest and fees and all other amounts to
be made by a Borrower pursuant to this Agreement with respect to any Loan or fee
relating thereto shall be paid without deduction for, and free from, any tax,
imposts, levies, duties, deductions, or withholdings of any nature now or at
anytime hereafter imposed by any governmental authority or by any taxing
authority thereof or therein excluding (i) in the case of each Bank, taxes
imposed on or measured by its net income, and franchise taxes imposed on it, by
the jurisdiction under the laws of which such Bank (as the case may be) is
organized or any political subdivision thereof and, in the case of each Bank,
taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction of such Bank's applicable Lending Office or any political
subdivision thereof, and (ii) in the case of Foreign Currency Money Market
Loans, any applicable withholding taxes pertaining thereto (all such non-
excluded taxes, imposts, levies, duties, deductions or withholdings of any
nature being "Taxes"). In the event that any Borrower is required by applicable
law to make any such withholding or deduction of Taxes with respect to any Loan
or fee or other amount, such Borrower shall pay such deduction or withholding to
the applicable taxing authority, shall promptly furnish to any Bank in respect
of which such deduction or withholding is made all receipts and other documents
evidencing such payment and shall pay to such Bank additional amounts as may be
necessary in order that the amount received by such Bank after the required
withholding or other
35
<PAGE>
payment shall equal the amount such Bank would have received had no such
withholding or other payment been made. If no withholding or deduction of Taxes
are payable in respect to any Loan or fee relating thereto, the Borrowers shall
furnish any Bank, at such Bank's request, a certificate from each applicable
taxing authority or an opinion of counsel reasonably acceptable to such Bank, in
either case stating that such payments are exempt from or not subject to
withholding or deduction of Taxes. If the Borrowers fail to provide such
original or certified copy of a receipt evidencing payment of Taxes or
certificate(s) or opinion of counsel of exemption, the Borrowers agree to
compensate such Bank for, and indemnify them with respect to, the tax
consequences of the Borrowers' failure to provide evidence of tax payments or
tax exemption.
Each Bank which is not organized under the laws of the United States or any
state thereof agrees, as soon as practicable after receipt by it of a request by
the Borrower to do so, to file all appropriate forms and take other appropriate
action to obtain a certificate or other appropriate document from the
appropriate governmental authority in the jurisdiction imposing the relevant
Taxes, establishing that it is entitled to receive payments of principal and
interest under this Agreement and the Notes without deduction and free from
withholding of any Taxes imposed by such jurisdiction; provided, that, if it is
-------- ----
unable, for any reason, to establish such exemption, or to file such forms and,
in any event, during such period of time as such request for exemption is
pending, the Borrower shall nonetheless remain obligated under the terms of the
immediately preceding paragraph.
In the event any Bank receives a refund of any Taxes paid by any Borrower
pursuant to this Section 2.12(d), it will pay to such Borrower the amount of
such refund promptly upon receipt thereof; provided, however, if at any time
-------- -------
thereafter it is required to return such refund, such Borrower shall promptly
repay to it the amount of such refund.
Without prejudice to the survival of any other agreement of the Borrowers
hereunder, the agreements and obligations of the Borrowers and the Banks
contained in this Section 2.12(d) shall be applicable with respect to any
Participant, Assignee or other Transferee, and any calculations required by such
provisions (i) shall be made based upon the circumstances of such Participant,
Assignee or other Transferee, and (ii) constitute a continuing agreement and
shall survive the termination of this Agreement and the payment in full or
cancellation of the Notes.
SECTION 2.13. Computation of Interest and Fees. Interest on Base Rate
--------------------------------
Loans shall be computed on the basis of a year of 360
36
<PAGE>
days and paid for the actual number of days elapsed (including the first day but
excluding the last day). Interest on Euro-Dollar Loans and on Foreign Currency
Money Market Loans shall be computed on the basis of a year of 360 days (except
for any Foreign Currency Money Market Loans outstanding in British pounds
sterling, Australian dollars, Belgian francs, Canadian dollars, Irish pounds or
New Zealand dollars, which shall be computed on the basis of a year of 365 or
366 days, as the case may be) and paid for the actual number of days elapsed,
calculated as to each Interest Period from and including the first day thereof
to but excluding the last day thereof. Facility fees and any other fees payable
hereunder shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.14. Election and Release of Borrowers. Any Wholly Owned
---------------------------------
Subsidiary (whether existing on the Closing Date or acquired or created
thereafter) may elect to become a Borrower hereunder at any time by executing
and delivering to the Agent for delivery to each of the Banks (i) an original
Borrower Acknowledgement And Agreement in the form of Exhibit K, thereby
---------
becoming a party to this Agreement, and (ii) the other items described in such
Acknowledgement and Agreement, including, without limitation, the Notes
described therein. Any Borrower, other than the Parent, may elect to be released
as a Borrower hereunder at any time upon (i) payment in full of all Loans
outstanding to such Borrower in immediately available funds (including any
amounts owed in connection therewith under Article VIII) and (ii) execution and
delivery by such Borrower to the Agent of an original Borrower Notice of
Withdrawal in the form of Exhibit L.
---------
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to First Borrowing. The obligation of each
-----------------------------
Bank to make a Loan on the occasion of the first Borrowing (or in the event no
Borrowing is made on the Closing Date, on the Closing Date) is subject to the
satisfaction of the conditions set forth in Section 3.02 and receipt by the
Agent of the following (as to the documents described in paragraphs (a),(c), (d)
and (e) below (in sufficient number of counterparts for delivery of a
counterpart to each Bank and retention of one counterpart by the Agent):
(a) from each of the parties hereto either (i) a duly executed
counterpart of this Agreement signed by such party
37
<PAGE>
or (ii) a facsimile transmission stating that such party has duly executed
a counterpart of this Agreement and sent such counterpart to the Agent;
(b) from each Borrower described in clause (ii) of the definition of
"Borrower", a duly executed Dollar Money Market Loan Note and a duly
executed Foreign Currency Money Market Loan Note, and from each Borrower
described in clause (i) of the definition of "Borrower", a duly executed
Syndicated Loan Note, in each case for the account of each Bank complying
with the provisions of Section 2.04;
(c) an opinion letter of Hunton & Williams, counsel for the Borrower,
together with an opinion of the Parent's General Counsel, both dated as of
the Closing Date, which taken together cover substantially the opinions set
forth in the form of opinion attached as Exhibit B and covering such
---------
additional matters relating to the transactions contemplated hereby as the
Agent or any Bank may reasonably request;
(d) an opinion of Jones, Day, Reavis & Pogue, special counsel for the
Agent, dated as of the Closing Date, substantially in the form of Exhibit C
---------
and covering such additional matters relating to the transactions
contemplated hereby as the Agent may reasonably request;
(e) a certificate (the "Closing Certificate") substantially in the
form of Exhibit G), dated as of the Closing Date, signed by an Authorized
---------
Officer of the Parent, to the effect that (i) no Default has occurred and
is continuing on the Closing Date and (ii) the representations and
warranties of the Borrowers contained in Article IV are true on and as of
the Closing Date;
(f) a certificate of incumbency of the Borrower, signed by the
Secretary or an Assistant Secretary of each Borrower, certifying as to the
names, true signatures and incumbency of the officer or officers of the
Borrower authorized to execute and deliver the Loan Documents, and
certified copies of the following items: (i) each Borrower's Certificate of
Incorporation or equivalent organic document, (ii) each Borrower's Bylaws,
(iii) a certificate of the Secretary of State of each state of
incorporation of Parent and each domestic Borrower as to the corporate good
standing, respectively, of Parent and each Borrower, and, if available, a
comparable certificate from the appropriate governing authorities of each
foreign Borrower and (iv) the action taken by the Board of Directors of
each Borrower authorizing such Borrower's execution, delivery and
38
<PAGE>
performance of this Agreement, the Notes and the other Loan Documents to
which such Borrower is a party;
(g) in the event of a Borrowing on the Closing Date, a Notice of
Borrowing or notification pursuant to Section 2.03(e) of acceptance of one
or more Money Market Quotes, as applicable;
(h) evidence satisfactory to the Agent of termination of the Loan
Agreement by and among the Parent, the Banks parties thereto, Wachovia Bank
of Georgia, N.A. (f/k/a The First National Bank of Atlanta) as
Administrative Agent, Wachovia Bank of Georgia, N.A. and Bank of America
National Trust and Savings Association, as Co-Agents dated September 28,
1990, as amended as of the Closing Date; and
(i) the fees payable pursuant to the Agent's Letter Agreement.
In addition, if the Borrower desires funding of a Fixed Rate Loan on the Closing
Date, the Agent shall have received, the requisite number of days prior to the
Closing Date, a funding indemnification letter satisfactory to it, pursuant to
which (i) the Agent and the relevant Borrowers shall have agreed upon the
interest rate, amount of Borrowing and Interest Period for such Fixed Rate Loan,
and (ii) such Borrowers shall indemnify the Banks from any loss or expense
arising from the failure to close on the anticipated Closing Date identified in
such letter or the failure to borrow such Fixed Rate Loan on such date.
SECTION 3.02. Conditions to All Borrowings. The obligation of each
----------------------------
Bank to make a Syndicated Loan, other than a Refunding Loan, on the occasion of
each Borrowing is subject to the satisfaction of the following conditions except
as expressly provided in the last sentence of this Section 3.02:
(a) receipt by the Agent of a Notice of Borrowing.
(b) the fact that, immediately before and after such Borrowing, no
Default shall have occurred and be continuing;
(c) the fact that the representations and warranties of the Borrower
contained in Article IV of this Agreement (other than the representation
and warranty contained in Section 4.04(b), which is made only on and as of
the Closing Date) shall be true on and as of the date of such Borrowing;
and
39
<PAGE>
(d) the fact that, immediately after such Borrowing, the conditions
set forth in clauses (i) and (ii) of Section 2.01(a) shall have been
satisfied.
Each Borrowing (both Syndicated and Money Market), other than of a Refunding
Loan, hereunder shall be deemed to be a representation and warranty by the
Borrower on the date of such Borrowing as to the truth and accuracy of the facts
specified in paragraphs (b), (c) and (d) of this Section.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Parent represents and warrants, as to itself and the Subsidiaries,
and each of the Borrowers represents and warrants, as to itself, that:
SECTION 4.01. Corporate Existence and Power. Each Borrower is a
-----------------------------
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation, is duly qualified to transact business
in every jurisdiction where the failure to qualify would have a Material Adverse
Effect, and has all corporate powers and all governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted.
SECTION 4.02. Corporate and Governmental Authorization; No
--------------------------------------------
Contravention. The execution, delivery and performance by each Borrower and the
- -------------
Parent of this Agreement, the Notes, the Parent Guaranty and the other Loan
Documents (i) are within such Borrower's corporate powers, (ii) have been duly
authorized by all necessary corporate action, (iii) require no action by or in
respect of or filing with, any governmental body, agency or official, (iv) do
not contravene, or constitute a default under, any provision of applicable law
or regulation or of the certificate of incorporation or by-laws of such Borrower
or of any agreement, judgment, injunction, order, decree or other instrument
binding upon such Borrower or any of the Subsidiaries, and (v) do not result in
the creation or imposition of any Lien on any asset of such Borrower or any of
the Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement and the Parent Guaranty
--------------
each constitute a valid and binding agreement of each Borrower and the Parent,
respectively, enforceable in accordance with its terms, and the Notes, and the
other Loan Documents, when executed and delivered in accordance with this
Agreement, will constitute valid and binding obligations of the Borrowers
parties thereto, enforceable in accordance with their
40
<PAGE>
respective terms, provided that the enforceability hereof and thereof is subject
--------
in each case to general principles of equity and to bankruptcy, insolvency and
similar laws affecting the enforcement of creditors' rights generally.
SECTION 4.04. Financial Information. (a) The consolidated balance
---------------------
sheet of the Parent and its Consolidated Subsidiaries as of December 31, 1994
and the related consolidated statements of income, shareholders' equity and cash
flows for the Fiscal Year then ended, reported on by Arthur Andersen & Co.,
copies of which have been delivered to each of the Banks, and the unaudited
consolidated financial statements of the Parent for the interim period ended
March 31, 1995, copies of which have been delivered to each of the Banks, fairly
present, in conformity with GAAP, the consolidated financial position of the
Parent and its Consolidated Subsidiaries as of such dates and their consolidated
results of operations and cash flows for such periods stated.
(b) Since December 31, 1994 there has been no event, act, condition or
occurrence having a Material Adverse Effect.
SECTION 4.05. No Litigation. There is no action, suit or proceeding
-------------
pending against or affecting the Parent or any of the Subsidiaries before any
court or arbitrator or any governmental body, agency or official which could
have a Material Adverse Effect.
SECTION 4.06. Compliance with ERISA. Except as set forth in Schedule
---------------------
4.06, as the same may be revised from time to time, (i) the Parent and each
member of the Controlled Group have fulfilled their obligations under the
minimum funding standards of ERISA and the Code with respect to each Plan and
are in compliance in all material respects with the presently applicable
provisions of ERISA and the Code, and have not incurred any liability to the
PBGC or a Plan under Title IV of ERISA; and (ii) neither the Parent nor any
member of the Controlled Group is or ever has been obligated to contribute to
any Multiemployer Plan.
SECTION 4.07. Compliance with Laws; Payment of Taxes. Each Borrower
--------------------------------------
and Consolidated Subsidiary is in compliance with all applicable laws,
regulations and similar requirements of governmental authorities the failure to
comply with which would result in a Material Adverse Effect, except where such
compliance is being contested in good faith through appropriate proceedings.
There have been filed on behalf of each Borrower and Consolidated Subsidiary all
Federal, state and local income, excise, property and other material tax returns
which are required to be filed by them (or appropriate extensions of such
filings have been obtained) and all taxes due pursuant to such returns or
pursuant
41
<PAGE>
to any assessment received by or on behalf of each Borrower or any Consolidated
Subsidiary (which are not being contested in good faith by such Person) have
been paid. The charges, accruals and reserves on the books of each Borrower and
Consolidated Subsidiary in respect of taxes or other governmental charges are,
in the opinion of Parent and each Borrower, adequate. United States income tax
returns of each Borrower and Consolidated Subsidiary have been examined and
closed through the Fiscal Year ended December 31, 1991.
SECTION 4.08. Subsidiaries; Identification of Consolidated
--------------------------------------------
Subsidiaries. Each of the Consolidated Subsidiaries which is not a Borrower is
- ------------
a corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, is duly qualified to transact
business in every jurisdiction where the failure to so qualify would have a
Material Adverse Effect, and has all corporate powers and all governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted in each case where the failure to have the same would
have a Material Adverse Effect. As of the Closing Date, the Parent has no
Subsidiaries except for those Subsidiaries listed on Schedule 4.08 which
accurately sets forth each such Subsidiary's complete name and jurisdiction of
incorporation, and which identifies Consolidated Subsidiaries as being such.
After the Closing Date, in the event that Parent's Subsidiaries are no longer
published in the Parent's annual reports filed with the Securities and Exchange
Commission, Schedule 4.08 shall be supplemented from time to time by the Parent,
with copies to the Agent and the Banks, to identify any additional Subsidiary
and any Subsidiary which has become a Consolidated Subsidiary and which has not
previously been shown as such on such annual reports or on Schedule 4.08 as
previously supplemented.
SECTION 4.09. Investment Company Act. Neither any Borrower nor any
----------------------
Subsidiary is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
SECTION 4.10. Public Utility Holding Company Act. Neither any
----------------------------------
Borrower nor any Subsidiary is a "holding company", or a "subsidiary company" of
a "holding company", or an "affiliate" of a "holding company" or of a
"subsidiary company" of a "holding company", as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended.
SECTION 4.11. Ownership of Property; Liens. Each Borrower and each
----------------------------
Consolidated Subsidiary has title to its properties sufficient for the conduct
of its business, and none of such property is subject to any Lien except as
permitted in Section 5.18.
42
<PAGE>
SECTION 4.12. No Default. Neither any Borrower nor any Consolidated
----------
Subsidiary is in default under or with respect to any agreement, instrument or
undertaking to which it is a party or by which it or any of its property is
bound which could have or cause a Material Adverse Effect. No Default or Event
of Default has occurred and is continuing.
SECTION 4.13. Full Disclosure. All information heretofore furnished
---------------
by the Borrowers to the Agent or any Bank (including, without limitation,
information contained in the Parent's form 10-K annual report for Fiscal Year
1994 and form 10-Q quarterly report for the first Fiscal Quarter of 1995) for
purposes of or in connection with this Agreement or any transaction contemplated
hereby is, and all such information hereafter furnished by the Borrowers to the
Agent or any Bank will be, true, accurate and complete in every material respect
or based on reasonable estimates on the date as of which such information is
stated or certified.
SECTION 4.14. Environmental Matters. (a) Neither any Borrower nor any
---------------------
Consolidated Subsidiary is subject to any Environmental Liability which could
have or cause a Material Adverse Effect and neither any Borrower nor any
Consolidated Subsidiary has been designated as a potentially responsible party
under CERCLA or under any state statute similar to CERCLA where the probable
resulting liability would have a Material Adverse Effect. Except as disclosed
on Schedule 4.14, as revised from time to time, to the knowledge of the Parent,
none of the Properties has been identified on any current or proposed (i)
National Priorities List under 40 C.F.R. (S) 300, (ii) CERCLIS list or (iii) any
list arising from a state statute similar to CERCLA.
(b) Except as disclosed on Schedule 4.14, as revised from time to
time, to the knowledge of the Parent, no Hazardous Materials have been or are
being used, produced, manufactured, processed, treated, recycled, generated,
stored, disposed of, managed or otherwise handled at, or shipped or transported
to or from the Properties or are otherwise present at, on, in or under the
Properties, except for Hazardous Materials, such as cleaning solvents,
pesticides and other materials used, produced, manufactured, processed, treated,
recycled, generated, stored, disposed of, managed, or otherwise handled in
minimal amounts in the ordinary course of business in compliance with all
applicable Environmental Requirements, except in such instances where such
failure of compliance would not have a Material Adverse Effect.
(c) Except as disclosed on Schedule 4.14, as revised from time to
time, each Borrower, and each of the Subsidiaries has procured all Environmental
Authorizations necessary for the conduct of its business, and is in compliance
with all
43
<PAGE>
Environmental Requirements in connection with the operation of the Properties
and each Borrower's and each Consolidated Subsidiary's respective businesses,
except in such instances where such failure of compliance would not have a
Material Adverse Effect.
SECTION 4.15. Capital Stock. All Capital Stock, debentures, bonds,
-------------
notes and all other securities of each Borrower and each Consolidated Subsidiary
presently issued and outstanding are validly and properly issued in accordance
with all applicable laws, including but not limited to, the "Blue Sky" laws of
all applicable states and the federal securities laws. Except as set forth in
Schedule 4.15, as revised from time to time, the issued shares of Capital Stock
of the Parent's Wholly Owned Subsidiaries are owned by the Parent free and clear
of any Lien or adverse claim and at least a majority of the issued shares of
capital stock of each of the Parent's other Subsidiaries (other than Wholly
Owned Subsidiaries) is owned by the Parent free and clear of any Lien or adverse
claim.
SECTION 4.16. Margin Stock. Neither any Borrower nor any Subsidiary
------------
is engaged principally, or as one of its important activities, in the business
of purchasing or carrying any Margin Stock, and no part of the proceeds of any
Loan will be used for any purpose which violates, or which is inconsistent with,
the provisions of Regulation U or Regulation X.
SECTION 4.17. Insolvency. After giving effect to the execution and
----------
delivery of the Loan Documents and the making of the Loans under this Agreement:
(i) no Borrower will (x) be "insolvent," within the meaning of such term as used
in O.C.G.A. (S) 18-2-22 or as defined in (S) 101 of the "Bankruptcy Code", or
Section 2 of either the "UFTA" or the "UFCA", or as defined or used in any
"Other Applicable Law" (as those terms are defined below), or (y) be unable to
pay its debts generally as such debts become due within the meaning of Section
548 of the Bankruptcy Code, Section 4 of the UFTA or Section 6 of the UFCA, or
(z) have an unreasonably small capital to engage in any business or transaction,
whether current or contemplated, within the meaning of Section 548 of the
Bankruptcy Code, Section 4 of the UFTA or Section 5 of the UFCA; and (ii) the
obligations of each Borrower under the Loan Documents and with respect to the
Loans will not be rendered avoidable under any Other Applicable Law. For
purposes of this Section 4.17, "Bankruptcy Code" means Title 11 of the United
States Code, "UFTA" means the Uniform Fraudulent Transfer Act, "UFCA" means the
Uniform Fraudulent Conveyance Act, and "Other Applicable Law" means any other
applicable state law pertaining to fraudulent transfers or acts voidable by
creditors, in each case as such law may be amended from time to time.
44
<PAGE>
SECTION 4.18. Insurance. Each Borrower and each Consolidated
---------
Subsidiary has (either in the name of such Borrower or in such Consolidated
Subsidiary's own name), with financially sound and reputable insurance
companies, insurance on all its property in comparable amounts and against
comparable risks as are usually insured against in the same general area by
companies of established repute engaged in the same or similar business.
SECTION 4.19. Investments. There are no Investments which are not
-----------
Restricted Investments and which are in excess of an aggregate amount of
$25,000,000, which are not within the Investment Guidelines.
ARTICLE V
COVENANTS
The Borrowers agree that, so long as any Bank has any Commitment
hereunder or any amount payable hereunder or under any Note remains unpaid:
SECTION 5.01. Information. The Parent will deliver to each of the
-----------
Banks:
(a) as soon as available and in any event within 90 days after the end
of each Fiscal Year, a consolidated balance sheet of the Parent and its
Consolidated Subsidiaries as of the end of such Fiscal Year and the related
consolidated statements of income, shareholders' equity and cash flows for
such Fiscal Year, setting forth in each case in comparative form the
figures for the previous fiscal year, all certified by Arthur Andersen &
Co. or other independent public accountants of nationally recognized
standing, with such certification to be free of exceptions and
qualifications not acceptable to the Required Banks;
(b) as soon as available and in any event within 60 days after the end
of each of the first 3 Fiscal Quarters of each Fiscal Year, a consolidated
balance sheet of the Parent and its Consolidated Subsidiaries as of the end
of such Fiscal Quarter and the related statement of income and statement of
cash flows for such Fiscal Quarter and for the portion of the Fiscal Year
ended at the end of such Fiscal Quarter, setting forth in each case in
comparative form the figures for the corresponding Fiscal Quarter and the
corresponding portion of the previous Fiscal Year, all certified (subject
to normal year-end adjustments) as to fairness of presentation, GAAP and
consistency by an
45
<PAGE>
Authorized Officer or the chief accounting officer of the Parent;
(c) within 10 Domestic Business Days after the delivery of each set of
financial statements referred to in paragraph (a) above and simultaneously
with the delivery of each set of financial statements referred to in
paragraph (b) above, a certificate, substantially in the form of Exhibit F
---------
(a "Compliance Certificate"), of an Authorized Officer or the chief
accounting officer of the Parent (i) setting forth in reasonable detail the
calculations required to establish whether the Parent was in compliance
with the requirements of Sections 5.15 through 5.20, inclusive, on the date
of such financial statements and (ii) stating whether any Default exists on
the date of such certificate and, if any Default then exists, setting forth
the details thereof and the action which the Parent is taking or proposes
to take with respect thereto;
(d) simultaneously with the delivery of each set of annual financial
statements referred to in paragraph (a) above, a statement of the firm of
independent public accountants which reported on such statements to the
effect that nothing has come to their attention to cause them to believe
that any Default existed on the date of such financial statements;
(e) within 5 Domestic Business Days after a Principal Officer becomes
aware of the occurrence of any Default, a certificate of an Authorized
Officer or the chief accounting officer of the Parent setting forth the
details thereof and the action which the Parent is taking or proposes to
take with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of the
Parent generally, copies of all financial statements, reports and proxy
statements so mailed;
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements
on Form S-8 or its equivalent) and annual, quarterly or monthly reports
which the Parent shall have filed with the Securities and Exchange
Commission;
(h) if and when any member of the Controlled Group (i) gives or is
required to give notice to the PBGC of any "reportable event" (as defined
in Section 4043 of ERISA) with respect to any Plan which might constitute
grounds for
46
<PAGE>
a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any
such reportable event, a copy of the notice of such reportable event given
or required to be given to the PBGC; (ii) receives notice of complete or
partial withdrawal liability under Title IV of ERISA, a copy of such
notice; or (iii) receives notice from the PBGC under Title IV of ERISA of
an intent to terminate or appoint a trustee to administer any Plan, a copy
of such notice; and
(i) from time to time such additional information regarding the
financial position or business of the Borrowers and the Subsidiaries as the
Agent, at the request of any Bank, may reasonably request.
SECTION 5.02. Inspection of Property, Books and Records.
-----------------------------------------
(a) Each Borrower will keep, and the Parent will cause each
Consolidated Subsidiary to keep, proper books of record and account in
which full, true and correct entries in conformity with GAAP shall be made
of all dealings and transactions in relation to its business and
activities.
(b) Prior to the occurrence of a Default, each Borrower will, and the
Parent will cause each Consolidated Subsidiary to, permit representatives
of any Bank at such Bank's expense after reasonable notice during regular
business hours (which date of visit shall be mutually agreed upon but shall
not be later than 2 weeks after the date requested by such Bank) to visit
and inspect, in the company of any of the Principal Officers or their
designees and their independent public accountants, any of their respective
properties, and to examine and make abstracts from any of their respective
books and records and to discuss with any of the Principal Officers the
respective affairs, finances and accounts of the Parent and its
Subsidiaries.
(c) After the occurrence of a Default, each Borrower will permit, and
the Parent will cause each Consolidated Subsidiary to permit, at the
Borrower's expense, representatives of any Bank to visit and inspect any of
their respective properties, to examine and make abstracts from any of
their respective books and records and to discuss their respective affairs,
finances and accounts with their respective officers, employees and
independent public accountants.
Each Borrower agrees to cooperate and assist in such visits and inspections set
forth in paragraphs (b) and (c) above in this
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Section, in each case at such reasonable times and as often as may reasonably be
desired. Provided, however, (i) in no event shall any Bank have access to
information prohibited by law, and (ii) in the event any Bank desires to inspect
confidential matters (which matters shall in no event include financial
information and data of the Parent or its Subsidiaries or other information the
Banks may require in order to determine compliance with this Agreement) under
this Section, such Bank shall execute a confidentiality agreement relating to
such matters, which agreement shall contain reasonable terms acceptable to such
Bank and its counsel.
SECTION 5.03. Maintenance of Existence. The Parent shall cause each
------------------------
Consolidated Subsidiary to maintain its corporate existence and not engage in
any substantial businesses outside of the information services industry.
SECTION 5.04. Dissolution. Neither any Borrower nor any Consolidated
-----------
Subsidiaries shall (a) suffer or permit dissolution or liquidation either in
whole or in part (except as may be permitted under Section 5.05), or (b) redeem
or retire any shares of its own stock or that of any Consolidated Subsidiary,
except (i) through corporate reorganization to the extent permitted by Section
5.05, or (ii) solely in accordance with its policies and programs approved by
the Parent's Board of Directors from time to time, but in no event during an
uncured Event of Default.
SECTION 5.05. Consolidations, Mergers and Sales of Assets. No
-------------------------------------------
Borrower will, nor will the Parent permit any Consolidated Subsidiary to,
consolidate or merge with or into, or sell, lease or otherwise transfer all or
any substantial part of its assets to, any other Person, or discontinue or
eliminate any Subsidiary or division, provided that (a) any Borrower may merge
--------
with another Person (provided that in the event of such merger involving the
Parent, the Parent is the surviving Person) if (i) such Person was organized
under the laws of the United States of America or one of its states, (ii) a
Borrower is the corporation surviving such merger and (iii) immediately after
giving effect to such merger, no Default shall have occurred and be continuing,
(b) Subsidiaries may merge with one another, and (c) the foregoing limitation on
the sale, lease or other transfer of assets and on the discontinuation or
elimination of a Subsidiary or division shall not prohibit, during any Fiscal
Quarter, a transfer of assets or the discontinuance or elimination of a
Subsidiary or division (in a single transaction or in a series of related
transactions) unless the aggregate assets to be so transferred or utilized in a
Subsidiary or division to be so discontinued, when combined with all other
assets transferred, and all other assets utilized in all other Subsidiaries or
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divisions discontinued, in any Fiscal Year, either (x) constituted more than 20%
of Consolidated Total Assets measured as of the end of the immediately preceding
Fiscal Year, or (y) contributed more than 20% of Consolidated Operating Profits
for the immediately preceding Fiscal Year. Notwithstanding the foregoing, in no
event shall any disposition of assets permitted in this Section 5.05 be
permitted in the event that after such disposition (x) Consolidated Total Assets
shall be less than $817,000,000 (which amount equals 80% of Consolidated Total
Assets as of December 31, 1994), or (y) assets not so disposed of shall have
contributed less than $171,286,000 (which amount equals 80% of Consolidated
Operating Profits for the Fiscal Year ending December 31, 1994) to Consolidated
Operating Profits as of the end of the immediately preceding Fiscal Year.
SECTION 5.06. Use of Proceeds. The Borrowers will use the proceeds of
---------------
the Loans hereunder for general corporate purposes (in compliance with all
applicable legal and regulatory requirements, including, without limitation,
Regulations U and X and the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended, and the regulations thereunder);
provided, that in the event the Parent or any Borrower intends to use the
- --------
proceeds of any of the Loans hereunder to finance or refinance, directly or
indirectly, an Acquisition of any Person (or the acquisition of (i) more than
50% of the publicly traded stock (of any class) of any Person or (ii) any of the
publicly traded stock (of any class) of any Person after the Parent, such
Borrower or any of the Subsidiaries shall have been required to file a Schedule
13D under the Securities Exchange Act of 1934, as amended, with respect to such
stock), then unless such Acquisition (or such other acquisition) has been
approved by the board of directors of such Person or officers thereof duly
authorized to do so, then (A) the Parent or such Borrower shall give the Agent
and the Banks written notice, not less than 10 days prior to the earlier of (x)
the public announcement or other commencement of a tender offer or (y) the
commencement of solicitation of proxies in the opposition to the Board of
Directors of the Person proposed to be acquired, of such intent (which notice
shall describe the proposed Acquisition or such other acquisition in reasonable
detail), and (B) notwithstanding any other provision of the Credit Agreement,
each Bank shall have the right to assign all of its interest in its Loans and
Commitments under the Facility, after first offering such assignment of its
interest to each of the other Banks, without the consent of the Parent or the
Agent.
SECTION 5.07. Compliance with Laws; Payment of Taxes. The Parent
--------------------------------------
will, and will cause each of the Subsidiaries and each member of the Controlled
Group to, comply with applicable laws (including but not limited to ERISA),
regulations and similar
49
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requirements of governmental authorities (including but not limited to PBGC),
except (i) where the necessity of such compliance is being contested in good
faith through appropriate proceedings, or (ii) where the failure to do so would
not have a Material Adverse Effect. The Parent will, and will cause each of the
Subsidiaries to, pay prior to the time the same become delinquent all taxes,
assessments, governmental charges, claims for labor, supplies, rent and other
obligations which, if unpaid, might become a lien against the property of the
Parent or any Consolidated Subsidiary, except (i) liabilities being contested in
good faith and against which, if requested by the Agent, the Parent will set up
reserves in accordance with GAAP, or (ii) where the failure to do so would not
have a Material Adverse Effect.
SECTION 5.08. Insurance. Each Borrower will maintain, and the Parent
---------
will cause each of the Subsidiaries to maintain (either in the name of such
Borrower or in such Consolidated Subsidiary's own name), with financially sound
and reputable insurance companies, insurance on all its property material to
its business in comparable amounts and against such risks as are usually insured
against in the same general area by companies of established repute engaged in
the same or similar business.
SECTION 5.09. Change in Fiscal Year. No Borrower will change its
---------------------
Fiscal Year without the consent of the Required Banks.
SECTION 5.10. Maintenance of Property. Each Borrower shall, and the
-----------------------
Parent shall cause each Consolidated Subsidiary to, maintain all of its
properties and assets in good condition, repair and working order, ordinary wear
and tear excepted, except where the failure to do so would not have a Material
Adverse Effect.
SECTION 5.11. Environmental Notices. Upon becoming aware of such
---------------------
matters, the Parent shall furnish to the Banks and the Agent prompt written
notice of all Environmental Liabilities, pending or anticipated Environmental
Proceedings, Environmental Notices, Environmental Judgments and Orders, and
Environmental Releases at, on, in, under or in any way affecting the Properties
or any adjacent property, and all facts, events, or conditions that could lead
to any of the foregoing, in each case if the same would have a Material Adverse
Effect.
SECTION 5.12. Environmental Matters. Except as set forth in Schedule
---------------------
5.12, as revised from time to time, neither any Borrower nor any Consolidated
Subsidiary will, and the Parent will not permit any Third Party to, use,
produce, manufacture, process, treat, recycle, generate, store, dispose of,
manage at, or otherwise handle, or ship or transport to or from the
50
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Properties any Hazardous Materials, except for Hazardous Materials such as
cleaning solvents, pesticides and other similar materials used, produced,
manufactured, processed, treated, recycled, generated, stored, disposed,
managed, or otherwise handled in minimal amounts in the ordinary course of
business in compliance with all applicable Environmental Requirements in each
case where the failure to comply would not have a Material Adverse Effect.
SECTION 5.13. Environmental Release. Each Borrower (and the Parent,
---------------------
with respect to the Subsidiaries) agrees that upon the occurrence of an
Environmental Release at or on any of the Properties owned by it or any
Consolidated Subsidiary, it will take appropriate action required by applicable
law, except in such cases where the failure to take such action would not have a
Material Adverse Effect.
SECTION 5.14. Transactions with Affiliates. Neither any Borrower nor
----------------------------
any of its Consolidated Subsidiaries shall enter into, or be a party to, any
transaction with any Affiliate of such Borrower or such Subsidiary (which
Affiliate is not a Borrower or a Wholly Owned Subsidiary), except as permitted
by law and in the ordinary course of business and pursuant to reasonable terms
which are no less favorable to such Borrower or such Subsidiary than would be
obtained in a comparable arm's length transaction with a Person which is not an
Affiliate.
SECTION 5.15. Restricted Investments. The Parent will not, and will
----------------------
not permit any of its Subsidiaries to, make any Restricted Investments unless,
after giving effect thereto, the aggregate amount of all such Investments made,
together with the aggregate of all loans and advances permitted by clause (iv)
of Section 5.16, does not exceed the sum of (A) $130,000,000, plus (B) 25% of
----
Consolidated Net Income during each Fiscal Quarter commencing after March 31,
1995 in which there was a net profit on a consolidated basis and less (C) 100%
----
of Consolidated Net Income during each Fiscal Quarter commencing after March 31,
1995 in which there was a net loss on a consolidated basis; provided that after
--------
giving effect to the making of any Restricted Investments permitted by this
Section, the Borrowers will be in full compliance with all the provisions of
this Agreement.
SECTION 5.16. Loans or Advances. Neither the Parent nor any of its
-----------------
Consolidated Subsidiaries shall make loans or advances to any Person except: (i)
loans or advances to and guaranties in favor of employees in the ordinary course
of business; (ii) deposits required by government agencies or public utilities;
(iii) intercompany loans or advances between the Parent and the Consolidated
Subsidiaries and vice versa; and (iv) loans or advances in an aggregate amount
which, together with
51
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Restricted Investments permitted by Section 5.15, do not exceed the sum of (A)
$130,000,000, plus (B) 25% of Consolidated Net Income during each Fiscal Quarter
----
commencing after March 31, 1995 in which there was a net profit on a
consolidated basis and less (C) 100% of Consolidated Net Income during each
----
Fiscal Quarter commencing after March 31, 1995 in which there was a net loss on
a consolidated basis; provided that after giving effect to the making of any
--------
loans, advances or deposits permitted by this Section, the Borrowers will be in
full compliance with all the provisions of this Agreement.
SECTION 5.17. Debt of Consolidated Subsidiaries. The Borrowers (other
---------------------------------
than the Parent) shall not, and the Parent shall not permit any other
Consolidated Subsidiary to, incur or permit to exist any Debt not in existence
on the Closing Date, and extensions or renewals thereof, other than (i) the
obligations to the Banks under this Agreement; (ii) Debt of the types described
in clause (vii) of the definition of Debt which is incurred in the ordinary
course of business in connection with (1) the sale or purchase of goods, or (2)
to assure performance of any Subsidiaries' service contracts, operating leases,
obligations to a utility or a governmental entity, or worker's compensation
obligations; and (iii) Debt (including Debt secured by Liens permitted by
Section 5.18) not exceeding an aggregate amount outstanding at any time equal to
20% of Consolidated Net Tangible Assets.
Any corporation which becomes a Consolidated Subsidiary after the date hereof
shall for all purposes of this Section be deemed to have created, assumed or
incurred at the time it becomes a Consolidated Subsidiary all Debt of such
corporation existing immediately after it becomes a Consolidated Subsidiary.
SECTION 5.18. Negative Pledge. The Borrowers shall not, and the
---------------
Parent shall not permit any Consolidated Subsidiary to, create, assume or suffer
to exist any Lien on any asset now owned or hereafter acquired by it, except (i)
purchase money security interests in goods purchased in the ordinary course of
business and for which the purchase price therefor is paid within 120 days of
such purchase, and (ii) Liens securing Debt (other than indebtedness represented
by the Notes) in an aggregate principal amount at any time outstanding which
does not exceed 20% of Consolidated Net Tangible Assets.
SECTION 5.19. Fixed Charges Coverage. At the end of each Fiscal
----------------------
Quarter, commencing with the Fiscal Quarter ending March 31, 1995, the ratio of
Income Available for Fixed Charges to Consolidated Fixed Charges for the Fiscal
Quarter just ended and the immediately preceding 3 Fiscal Quarters shall not
have been less than 2.5 to 1.0; provided, however, that if the CSC Put
--------
52
<PAGE>
is funded, such ratio shall be greater than 2.0 to 1.0 at the end of the Fiscal
Quarter in which the CSC Put is funded and at the end of each of the immediately
succeeding 3 Fiscal Quarters.
SECTION 5.20. Ratio of Net Funded Debt to Cash Flow. At the end of
-------------------------------------
each Fiscal Quarter, the ratio of Net Funded Debt to Cash Flow for the Fiscal
Quarter just ended shall be less than 4.0 to 1.0; provided, however, that if the
--------
CSC Put is funded, such ratio shall be less than 4.5 to 1.0 at the end of the
Fiscal Quarter in which the CSC Put is funded and at the end of the immediately
succeeding 3 Fiscal Quarters.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following
-----------------
events ("Events of Default") shall have occurred and be continuing:
(a) any Borrower shall fail to pay (i) when due any principal of any
Loan or (ii) any interest on any Loan within 5 Domestic Business Days after
such interest shall become due, or (iii) any fee or other amount payable
hereunder within 5 Domestic Business Days after such fee or other amount
becomes due; or
(b) the Borrowers shall fail to observe or perform any covenant (i)
contained in Sections 5.17 or 5.18 and such failure shall not have been
cured within 15 days after the earlier to occur of (1) written notice
thereof has been given to the Parent by the Agent at the request of any
Bank or (2) the Parent otherwise becomes aware of any such failure, or (ii)
contained in Sections 5.01(e), 5.02(b), 5.02(c), 5.03 to 5.06, inclusive,
5.15, 5.16, 5.19 or 5.20; or
(c) the Borrowers shall fail to observe or perform any covenant or
agreement contained in this Agreement (other than those covered by
paragraph (a) or (b) above) and such failure shall not have been cured
within 30 days after the earlier to occur of (i) written notice thereof has
been given to the Parent by the Agent at the request of any Bank or (ii)
the Parent otherwise becomes aware of any such failure; or
(d) any representation, warranty, certification or statement made by
the Borrower in Article IV of this Agreement or in any certificate,
financial statement or
53
<PAGE>
other document delivered pursuant to this Agreement shall prove to have
been incorrect or misleading in any material respect when made (or deemed
made); or
(e) the Borrower or any Consolidated Subsidiary shall fail to make any
payment in respect of Debt in an aggregate amount in excess of $10,000,000
outstanding (other than the Notes) when due or within any applicable grace
period; or
(f) any event or condition shall occur which results in the
acceleration of the maturity of Debt of the Borrower or any Consolidated
Subsidiary in an aggregate amount outstanding equal to or in excess of
$20,000,000 (including, without limitation, any required mandatory
prepayment or "put" of such Debt to the Borrower or any Consolidated
Subsidiary which can be effected by the holder of such Debt upon the
occurrence of an event in the nature of a default) or enables the holders
of such Debt or any Person acting on such holders' behalf to accelerate the
maturity thereof (including, without limitation, any required mandatory
prepayment or "put" of such Debt to the Borrower or any Consolidated
Subsidiary which can be effected by the holder of such Debt upon the
occurrence of an event in the nature of a default), excluding, however,
from the foregoing paragraph (f), (i) any "put" of Debt to a Borrower or
any Consolidated Subsidiary pursuant to the CSC Put, and (ii) any "put" to
a Borrower or any Consolidated Subsidiary of Debt evidenced by the Parent's
6 1/2% Senior Notes due 2003 pursuant to the Indenture relating thereto,
unless the event resulting in such "put" under this clause (ii) shall have
a Material Adverse Effect; or
(g) the Borrower or any Consolidated Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or
other relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or shall consent to
any such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against it,
or shall make a general assignment for the benefit of creditors, or shall
fail generally to pay its debts as they become due, or shall take any
corporate action to authorize any of the foregoing; or
(h) an involuntary case or other proceeding shall be commenced against
the Borrower or any Consolidated Subsidiary seeking liquidation,
reorganization or other
54
<PAGE>
relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of
a trustee, receiver, liquidator, custodian or other similar official of it
or any substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 60 days;
or an order for relief shall be entered against the Borrower or any
Consolidated Subsidiary under the federal bankruptcy laws as now or
hereafter in effect; or
(i) the Borrower or any member of the Controlled Group shall fail to
pay when due any material amount which it shall have become liable to pay
to the PBGC or to a Plan under Title IV of ERISA; or notice of intent to
terminate a Plan or Plans shall be filed under Title IV of ERISA by the
Borrower, any member of the Controlled Group, any plan administrator or any
combination of the foregoing which results in an obligation which would
have a Material Adverse Effect; or the PBGC shall institute proceedings
under Title IV of ERISA to terminate or to cause a trustee to be appointed
to administer any such Plan or Plans or a proceeding shall be instituted by
a fiduciary of any such Plan or Plans to enforce Section 515 or 4219(c)(5)
of ERISA and such proceeding shall not have been dismissed within 30 days
thereafter which results in an obligation which would have a Material
Adverse Effect; or a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that any such Plan or
Plans must be terminated which results in an obligation which would have a
Material Adverse Effect; or the Borrower or any other member of the
Controlled Group shall enter into, contribute or be obligated to contribute
to, terminate or incur any withdrawal liability with respect to, a
Multiemployer Plan which results in an obligation which would have a
Material Adverse Effect; or
(j) one or more judgments or orders for the payment of money in an
aggregate amount in excess of $10,000,000 (exclusive of the portion of the
judgment amount fully covered by insurance where the insurer has admitted
liability in respect of such judgment in writing) shall be rendered against
the Borrower or any Consolidated Subsidiary and (i) such judgment or order
shall not be discharged within or shall continue unsatisfied and unstayed
for a period of 30 days after the entry thereof, or (ii) such Borrower or
the applicable Consolidated Subsidiary shall not appeal such judgment
within such 30 day period and the execution of such judgment shall not be
stayed during such appeal; or
55
<PAGE>
(k) a federal tax lien shall be filed against the Borrower or any
Consolidated Subsidiary under Section 6323 of the Code or a lien of the
PBGC shall be filed against the Borrower or any Consolidated Subsidiary
under Section 4068 of ERISA and in either case the amount of such lien
shall exceed $5,000,000 and shall remain undischarged for a period of 25
days after the date of filing; or
(l) (i) any Person or two or more Persons acting in concert shall,
after the Closing Date, have acquired beneficial ownership (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934) of 25% or more of the outstanding shares
of the voting stock of the Borrower; or (ii) as of any date a majority of
the Board of Directors of the Borrower consists of individuals who were not
either (A) directors of the Borrower as of the corresponding date of the
previous year, (B) selected or nominated to become directors by the Board
of Directors of the Borrower of which a majority consisted of individuals
described in clause (A), or (C) selected or nominated to become directors
by the Board of Directors of the Borrower of which a majority consisted of
individuals described in clause (A) and individuals described in clause
(B); or
(m) any breach or default occurs under the Parent Guaranty
then, and in every such event, the Agent shall (i) if requested by the Required
Banks, by notice to the Borrowers terminate the Commitments and they shall
thereupon terminate, (ii) any Bank may terminate its obligation to fund a Money
Market Loan in connection with any relevant Money Market Quote, and (iii) if
requested by the Required Banks, by notice to the Borrowers declare the Notes
(together with accrued interest thereon) to be, and the Notes shall thereupon
become, immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrowers
together with interest at the Default Rate accruing on the principal amount
thereof from and after the date of such Event of Default; provided that if any
--------
Event of Default specified in paragraph (g) or (h) above occurs with respect to
any Borrower, without any notice to such Borrower or any other act by the Agent
or the Banks, the Commitments shall thereupon terminate and the Notes (together
with accrued interest thereon) shall become immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower together with interest thereon at the Default Rate
accruing on the principal amount thereof from and after the date of such Event
of Default. Notwithstanding the foregoing, the
56
<PAGE>
Agent shall have available to it all other remedies at law or equity, and shall
exercise any one or all of them at the request of the Required Banks.
SECTION 6.02. Notice of Default. The Agent shall give notice to the
-----------------
Borrower of any Default under Section 6.01(c) promptly upon being requested to
do so by any Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment; Powers and Immunities. Each Bank hereby
----------------------------------
irrevocably appoints and authorizes the Agent to act as its agent hereunder and
under the other Loan Documents with such powers as are specifically delegated to
the Agent by the terms hereof and thereof, together with such other powers as
are reasonably incidental thereto. The Agent: (a) shall have no duties or
responsibilities except as expressly set forth in this Agreement and the other
Loan Documents, and shall not by reason of this Agreement or any other Loan
Document be a trustee for any Bank; (b) shall not be responsible to the Banks
for any recitals, statements, representations or warranties contained in this
Agreement or any other Loan Document, or in any certificate or other document
referred to or provided for in, or received by any Bank under, this Agreement or
any other Loan Document, or for the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
any other document referred to or provided for herein or therein or for any
failure by any Borrower to perform any of its obligations hereunder or
thereunder; (c) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder or under any other Loan Document except to the
extent requested by the Required Banks, and then only on terms and conditions
satisfactory to the Agent, and (d) shall not be responsible for any action taken
or omitted to be taken by it hereunder or under any other Loan Document or any
other document or instrument referred to or provided for herein or therein or in
connection herewith or therewith, except for its own gross negligence or wilful
misconduct. The Agent 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 selected by it with reasonable care. The provisions of this Article VII
are solely for the benefit of the Agent and the Banks, and the Borrower shall
not have any rights as a third party beneficiary of any of the provisions
hereof. In performing its functions and duties under this Agreement and under
the other Loan Documents, the Agent shall act solely as agent of the Banks and
does not
57
<PAGE>
assume and shall not be deemed to have assumed any obligation towards or
relationship of agency or trust with or for the Borrower. The duties of the
Agent shall be ministerial and administrative in nature, and the Agent shall not
have by reason of this Agreement or any other Loan Document a fiduciary
relationship in respect of any Bank.
SECTION 7.02. Reliance by Agent. The Agent shall be entitled to rely
-----------------
upon any certification, notice or other communication (including any thereof by
telephone, telecopier, telegram or cable) believed by it to be genuine and
correct and to have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel, independent
accountants or other experts selected by the Agent. As to any matters not
expressly provided for by this Agreement or any other Loan Document, the Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder and thereunder in accordance with instructions signed by the Required
Banks, and such instructions of the Required Banks in any action taken or
failure to act pursuant thereto shall be binding on all of the Banks.
SECTION 7.03. Defaults. The Agent shall not be deemed to have
--------
knowledge of the occurrence of a Default or an Event of Default (other than the
nonpayment of principal of or interest on the Loans) unless the Agent has
received notice from a Bank or the Borrower specifying such Default or Event of
Default and stating that such notice is a "Notice of Default". In the event
that the Agent receives such a notice of the occurrence of a Default or an Event
of Default, the Agent shall give prompt notice thereof to the Banks. The Agent
shall give each Bank prompt notice of each nonpayment of principal of or
interest on the Loans whether or not it has received any notice of the
occurrence of such nonpayment. The Agent shall (subject to Section 9.06) take
such action hereunder with respect to such Default or Event of Default as shall
be directed by the Required Banks, provided that, unless and until the Agent
shall have received such directions, the Agent may (but shall not be obligated
to) take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable in the best interests of
the Banks.
SECTION 7.04. Rights of Agent as a Bank. With respect to the Loans
-------------------------
made by it, Wachovia in its capacity as a Bank hereunder shall have the same
rights and powers hereunder as any other Bank and may exercise the same as
though it were not acting as the Agent, and the term "Bank" or "Banks" shall,
unless the context otherwise indicates, include Wachovia in its individual
capacity. The Agent may (without having to account therefor to any Bank) accept
deposits from, lend money to and generally
58
<PAGE>
engage in any kind of banking, trust or other business with the Borrowers (and
any of their Affiliates) as if it were not acting as the Agent, and the Agent
may accept fees and other consideration from the Borrowers (in addition to any
agency fees and arrangement fees heretofore agreed to between the Borrowers and
the Agent) for services in connection with this Agreement or any other Loan
Document or otherwise without having to account for the same to the Banks.
SECTION 7.05. Indemnification. Each Bank severally agrees to
---------------
indemnify the Agent, to the extent the Agent shall not have been reimbursed by
the Borrowers, ratably in accordance with its Commitment, for any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including, without limitation, counsel fees and disbursements)
or disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Agent in any way relating to or arising out
of this Agreement or any other Loan Document or any other documents contemplated
by or referred to herein or therein or the transactions contemplated hereby or
thereby (excluding, unless an Event of Default has occurred and is continuing,
the normal administrative costs and expenses incident to the performance of its
agency duties hereunder) or the enforcement of any of the terms hereof or
thereof or any such other documents; provided, however that no Bank shall be
-------- -------
liable for any of the foregoing to the extent they arise from the gross
negligence or wilful misconduct of the Agent. If any indemnity furnished to the
Agent for any purpose shall, in the opinion of the Agent, be insufficient or
become impaired, the Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished.
SECTION 7.06 Consequential Damages. THE AGENT SHALL NOT BE
---------------------
RESPONSIBLE OR LIABLE TO ANY BANK, THE BORROWER OR ANY OTHER PERSON OR ENTITY
FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A
RESULT OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
SECTION 7.07. Payee of Note Treated as Owner. The Agent may deem and
------------------------------
treat the payee of any Note as the owner thereof for all purposes hereof unless
and until a written notice of the assignment or transfer thereof shall have been
filed with the Agent and the provisions of Section 9.08(c) have been satisfied.
Any requests, authority or consent of any Person who at the time of making such
request or giving such authority or consent is the holder of any Note shall be
conclusive and binding on any subsequent holder, transferee or assignee of that
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Note or of any Note or Notes issued in exchange therefor or replacement thereof.
SECTION 7.08. Nonreliance on Agent and Other Banks. Each Bank agrees
------------------------------------
that it has, independently and without reliance on the Agent or any other Bank,
and based on such documents and information as it has deemed appropriate, made
its own credit analysis of the Borrower and decision to enter into this
Agreement and that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement or any of the other Loan
Documents. The Agent shall not be required to keep itself informed as to the
performance or observance by the Borrowers of this Agreement or any of the other
Loan Documents or any other document referred to or provided for herein or
therein or to inspect the properties or books of the Borrowers or any other
Person. Except for notices, reports and other documents and information
expressly required to be furnished to the Banks by the Agent hereunder or under
the other Loan Documents, the Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning the affairs,
financial condition or business of the Borrower or any other Person (or any of
their Affiliates) which may come into the possession of the Agent.
SECTION 7.09. Failure to Act. Except for action expressly required of
--------------
the Agent hereunder or under the other Loan Documents, the Agent shall in all
cases be fully justified in failing or refusing to act hereunder and thereunder
unless it shall receive further assurances to its satisfaction by the Banks of
their indemnification obligations under Section 7.05 against any and all
liability and expense which may be incurred by the Agent by reason of taking,
continuing to take, or failing to take any such action.
SECTION 7.10. Resignation or Removal of Agent. Subject to the
-------------------------------
appointment and acceptance of a successor Agent as provided below, the Agent may
resign at any time by giving notice thereof to the Banks and the Borrowers and
the Agent may be removed at any time with or without cause by the Required
Banks. Upon any such resignation or removal, the Required Banks shall have the
right to appoint a successor Agent. If no successor Agent shall have been so
appointed by the Required Banks and shall have accepted such appointment within
30 days after the retiring Agent's notice of resignation or the Required Banks'
removal of the retiring Agent, then the retiring Agent may, on behalf of the
Banks, appoint a successor Agent. Any successor Agent shall be a bank which
has a combined capital and surplus of at least $1,000,000,000. Upon the
acceptance of any appointment
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as Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations hereunder. After any retiring Agent's resignation or
removal hereunder as Agent, the provisions of this Article VII 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 Agent hereunder.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate or
-------------------------------------------------
Unfair. If on or prior to the first day of any Interest Period:
(a) the Agent determines that deposits in Dollars (in the applicable
amounts) are not being offered in the relevant market for such Interest
Period, or
(b) the Required Banks advise the Agent that the London Interbank
Offered Rate or IBOR, as the case may be, as determined by the Agent will
not adequately and fairly reflect the cost to such Banks of funding the
relevant type of Fixed Rate Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrowers and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, the obligations of the Banks to make
the type of Fixed Rate Loans specified in such notice shall be suspended.
Unless the relevant Borrower notifies the Agent at least 2 Domestic Business
Days before the date of any Borrowing of such type of Fixed Rate Loans for which
a Notice of Borrowing has previously been given that it elects not to borrow on
such date, such Borrowing shall instead be made as a Base Rate Borrowing.
SECTION 8.02. Illegality. If, after the date hereof, the adoption of
----------
any applicable law, rule or regulation, or any change therein, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof (any such agency being referred to as an "Authority" and
any such event being referred to as a "Change of Law"), or compliance by any
Bank (or its Lending Office) with any request or directive (whether or not
having the force of law) of any Authority shall make it unlawful or impossible
for any Bank
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(or its Lending Office) to make, maintain or fund its Euro-Dollar Loans or
Foreign Currency Money Market Loans and such Bank shall so notify the Agent, the
Agent shall forthwith give notice thereof to the other Banks and the Borrowers,
whereupon until such Bank notifies the Borrower and the Agent that the
circumstances giving rise to such suspension no longer exist, the obligation of
such Bank to make Euro-Dollar Loans or Foreign Currency Money Market Loans, as
the case may be, shall be suspended. Before giving any notice to the Agent
pursuant to this Section, such Bank shall designate a different Lending Office
if such designation will avoid the need for giving such notice and will not, in
the judgment of such Bank, be otherwise disadvantageous to such Bank. If such
Bank shall determine that it may not lawfully continue to maintain and fund any
of its outstanding Euro-Dollar Loans or Foreign Currency Money Market Loans, as
the case may be, to maturity and shall so specify in such notice, the relevant
Borrower shall immediately prepay in full the then outstanding principal amount
of each Euro-Dollar Loan or Foreign Currency Money Market Loans, as the case may
be, of such Bank, together with accrued interest thereon. Concurrently with
prepaying each such Euro-Dollar Loan or Foreign Currency Money Market Loans, as
the case may be, the relevant Borrower shall borrow a Base Rate Loan in an equal
principal amount from such Bank (on which interest and principal shall be
payable contemporaneously with the related Euro-Dollar Loans or Foreign Currency
Money Market Loans, as the case may be, of the other Banks), and such Bank shall
make such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If after the
---------------------------------
date hereof, a Change of Law or compliance by any Bank (or its Lending Office)
with any request or directive (whether or not having the force of law) of any
Authority:
(i) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including, without limitation, (1) any such
requirement imposed by the Board of Governors of the Federal Reserve
System, and (2) with respect to any Euro-Dollar Loan, any reserve
requirement described in the definition of Euro-Dollar Reserve Percentage
in excess of the reserve requirement of the Agent, but excluding, with
respect to any Foreign Currency Money Market Loan, any such requirement
described in the definition of Adjusted IBOR Rate) against assets of,
deposits with or for the account of, or credit extended by, any Bank (or
its Lending Office); or
(ii) shall impose on any Bank (or its Lending Office) or on the United
States market for certificates of deposit or the London interbank market
any other condition affecting
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its Fixed Rate Loans, its Notes or its obligation to make Fixed Rate Loans;
and the result of any of the foregoing is to increase the cost to such Bank (or
its Lending Office) of making or maintaining any Fixed Rate Loan, or to reduce
the amount of any sum received or receivable by such Bank (or its Lending
Office) under this Agreement or under its Notes with respect thereto, by an
amount deemed by such Bank to be material, then, within 15 days after demand by
such Bank (with a copy to the Agent), the relevant Borrower shall pay to such
Bank such additional amount or amounts as will compensate such Bank for such
increased cost or reduction.
(b) If any Bank shall have determined that after the date hereof the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change therein, or any change in the interpretation or administration
thereof, or compliance by any Bank (or its Lending Office) with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any Authority, has or would have the effect of reducing the rate of return on
such Bank's capital as a consequence of its obligations hereunder to a level
below that which such Bank could have achieved but for such adoption, change or
compliance (taking into consideration such Bank's policies with respect to
capital adequacy) by an amount deemed by such Bank to be material, then within
15 days after demand by such Bank (with a copy to the Agent), the Borrower shall
pay to such Bank such additional amount or amounts as will compensate such Bank
for such reduction, but in no event shall the Borrower be liable for amounts
incurred more than 90 days prior to receipt of such demand.
(c) Each Bank will promptly notify the Borrowers and the Agent of any
event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section and will designate a
different Lending Office if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank. A certificate of any Bank claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, such Bank may use any reasonable
averaging and attribution methods.
(d) Notwithstanding the foregoing, in the event the Borrowers are
required to pay any Bank amounts pursuant to Section 2.12 or this Section 8.03
and the designation of a different Lending Office pursuant to Section 2.12 or
Section
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8.03(c) will not avoid the need for compensation to such Bank (an "Affected
Bank"), the Borrower may give notice to such Affected Bank (with copies to the
Agent) that it wishes to seek one or more assignees (which may be one or more of
the Banks) to assume the Commitment of such Affected Bank and to purchase its
outstanding Loans and Notes; provided, that if there is more than one Affected
--------
Bank which has requested substantially and proportionally equal compensation
hereunder, the Borrower shall elect to seek an assignee to assume the
Commitments of all such Affected Banks. Each Affected Bank agrees to sell its
Commitment, Loans, Notes and interest in this Agreement in accordance with
Section 9.08(c) to any such assignee for an amount equal to the sum of the
outstanding unpaid principal of and accrued interest on such Loans and Notes,
plus all other fees and amounts (including, without limitation, any compensation
due to such Affected Banks under Section 2.12 or this Section 8.03) due to such
Affected Bank hereunder calculated, in each case, to the date such Loans, Notes
and interest are purchased. Upon such sale or prepayment, each such Affected
Bank shall have no further commitment or other obligation to the Borrower
hereunder or under any Note.
(e) The provisions of this Section 8.03 (i) shall be applicable with
respect to any Participant, Assignee or other Transferee, and any calculations
required by such provisions shall be made based upon the circumstances of such
Participant, Assignee or other Transferee and (ii) shall constitute a continuing
agreement and shall survive the termination of this Agreement and the payment in
full or cancellation of the Notes.
SECTION 8.04. Base Rate Loans or Other Fixed Rate Loans Substituted
-----------------------------------------------------
for Affected Fixed Rate Loans. If (i) the obligation of any Bank to make or
- -----------------------------
maintain any type of Fixed Rate Loans has been suspended pursuant to Section
8.02 or (ii) any Bank has demanded compensation under Section 8.03, and the
Borrower shall, by at least 5 Euro-Dollar Business Days' or Foreign Currency
Business Days, as applicable, prior notice to such Bank through the Agent, have
elected that the provisions of this Section shall apply to such Bank, then,
unless and until such Bank notifies the Borrower that the circumstances giving
rise to such suspension or demand for compensation no longer apply:
(a) all Loans which would otherwise be made by such Bank as Euro-
Dollar Loans or Foreign Currency Money Market Loans, as the case may be,
shall be made instead as Base Rate Loans, except that if such demand for
compensation relates to Foreign Currency Money Market Loans, but not Euro-
Dollar Loans, as either Base Rate Loans or Euro-Dollar Loans, as the
relevant Borrower may elect in the notice to such Bank through the Agent
referred to hereinabove (in all
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cases interest and principal on such Loans shall be payable
contemporaneously with the related Fixed Rate Loans of the other Banks),
and
(b) after each of its Euro-Dollar Loans or Foreign Currency Money
Market Loans, as the case may be, has been repaid, all payments of
principal which would otherwise be applied to repay such Fixed Rate Loans
shall be applied to repay its Base Rate Loans instead.
SECTION 8.05. Compensation. Upon the request of any Bank, delivered
------------
to the Borrower and the Agent, the Borrowers shall pay to such Bank such amount
or amounts as shall compensate such Bank for any loss, cost or expense incurred
by such Bank as a result of:
(a) any payment or prepayment (pursuant to Section 2.10, 2.11, 6.01,
8.02 or otherwise) of a Fixed Rate Loan on a date other than the last day of an
Interest Period for such Fixed Rate Loan; or
(b) if the Banks have permitted prepayment of any Fixed Rate Loan, any
failure by the relevant Borrower to prepay such Fixed Rate Loan on the date for
such prepayment specified in the relevant notice of prepayment hereunder; or
(c) any failure by a Borrower to borrow a Fixed Rate Loan on the date
for the Fixed Rate Borrowing of which such Fixed Rate Loan is a part specified
in the applicable Notice of Borrowing delivered pursuant to Section 2.02 or
notification of acceptance of Money Market Quotes pursuant to Section 2.03(e);
or
(d) any failure by a Borrower to pay a Foreign Currency Money Market
Loan in the applicable Foreign Currency;
such compensation to include, without limitation, as applicable: (A) an amount
equal to the excess, if any, of (x) the amount of interest which would have
accrued on the amount so paid or prepaid or not prepaid or borrowed for the
period from the date of such payment, prepayment or failure to prepay or borrow
to the last day of the then current Interest Period for such Fixed Rate Loan
(or, in the case of a failure to prepay or borrow, the Interest Period for such
Fixed Rate Loan which would have commenced on the date of such failure to prepay
or borrow) at the applicable rate of interest for such Fixed Rate Loan provided
for herein over (y) the amount of interest (as reasonably determined by such
Bank) such Bank would have paid on (i) deposits in Dollars of comparable amounts
having terms comparable to such period placed with it by leading banks in the
London interbank market (if such Fixed Rate Loan is a Euro-Dollar Loan), or (ii)
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any deposit in a Foreign Currency of comparable amounts having terms comparable
to such period placed with it by lending banks in the applicable interbank
market for such Foreign Currency (if such Fixed Rate Loan is a Foreign Currency
Money Market Loan); or (B) any such loss, cost or expense incurred by such Bank
in liquidating or closing out any foreign currency contract undertaken by such
Bank in funding or maintaining such Fixed Rate Loan (if such Fixed Rate Loan is
a Foreign Currency Money Market Loan).
SECTION 8.06. Failure to Pay in Foreign Currency. If any Borrower is
----------------------------------
unable for any reason to effect payment in a Foreign Currency as required by
this Agreement or if any Borrower shall default in the Foreign Currency, each
Bank may, through the Agent, require such payment to be made in Dollars in the
Dollar Equivalent amount of such payment. In any case in which any Borrower
shall make such payment in Dollars, such Borrower agrees to hold the Banks
harmless from any loss incurred by the Banks arising from any change in the
value of Dollars in relation to such Foreign Currency between the date such
payment became due and the date of payment thereof.
SECTION 8.07. Judgment Currency. If for the purpose of obtaining
-----------------
judgment in any court or enforcing any such judgment it is necessary to convert
any amount due in any Foreign Currency into any other currency, the rate of
exchange used shall be the Agent's spot rate of exchange for the purchase of the
Foreign Currency with such other currency at the close of business on the
Foreign Currency Business Day preceding the date on which judgment is given or
any order for payment is made. The obligation of the relevant Borrower in
respect of any amount due from it hereunder shall, notwithstanding any judgment
or order for a liquidated sum or sums in respect of amounts due hereunder or
under any judgment or order in any other currency or otherwise be discharged
only to the extent that on the Foreign Currency Business Day following receipt
by the Agent of any payment in a currency other than the relevant Foreign
Currency the Agent is able (in accordance with normal banking procedures) to
purchase an amount of the relevant Foreign Currency with such other currency
equal to the amount owed. If the amount of the relevant Foreign Currency that
the Agent is able to purchase with such other currency is less than the amount
due in the relevant Foreign Currency, notwithstanding any judgment or order,
such Borrower shall indemnify the Banks for the shortfall.
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ARTICLE IX
MISCELLANEOUS
-------------
SECTION 9.01. Notices. All notices, requests and other communications
-------
to any party hereunder shall be in writing (including bank wire, telecopier or
similar writing) and shall be given to such party at its address or telecopier
number set forth on the signature pages hereof or such other address or
telecopier number as such party may hereafter specify for the purpose by notice
to each other party. Each such notice, request or other communication shall be
effective (i) if given by telecopier, when such telecopy is transmitted to the
telecopier number specified in this Section and the appropriate confirmation is
received, (ii) if given by mail, 72 hours after such communication is deposited
in the mails with first class postage prepaid, addressed as aforesaid or (iii)
if given by any other means, when delivered at the address specified in this
Section; provided that notices to the Agent under Article II or Article VIII
--------
shall not be effective until received.
SECTION 9.02. No Waivers. No failure or delay by the Agent or any
----------
Bank in exercising any right, power or privilege hereunder or under any Note or
other Loan Document shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
SECTION 9.03. Expenses; Documentary Taxes. The Borrowers shall pay
---------------------------
(i) all reasonable out-of-pocket expenses of the Agent, including fees and
disbursements of special counsel for the Banks and the Agent, in connection with
the preparation of this Agreement and the other Loan Documents, any waiver or
consent hereunder or thereunder or any amendment hereof or thereof or any
Default or alleged Default hereunder or thereunder and (ii) if a Default occurs,
all actual out-of-pocket expenses incurred by the Agent and the Banks, including
reasonable fees and the actual disbursements of outside counsel or the
equivalent allocated costs of in-house counsel, in connection with such Default
and collection and other enforcement proceedings resulting therefrom, including
out-of-pocket expenses incurred in enforcing this Agreement and the other Loan
Documents. The Borrowers shall indemnify the Agent and each Bank against any
transfer taxes, documentary taxes, assessments or charges made by any Authority
by reason of the execution and delivery of this Agreement or the other Loan
Documents.
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SECTION 9.04. Indemnification. The Borrowers shall indemnify the
---------------
Agent, the Banks and each Affiliate thereof and their respective directors,
officers, employees and agents from, and hold each of them harmless against, any
and all actual losses, liabilities, claims or damages to which any of them may
become subject, insofar as such losses, liabilities, claims or damages arise out
of or result from any actual or proposed use by the Borrowers of the proceeds of
any extension of credit by any Bank hereunder or breach by the Borrowers of this
Agreement or any other Loan Document or from any investigation, litigation
(including, without limitation, any actions taken by the Agent or any of the
Banks to enforce this Agreement or any of the other Loan Documents) or other
proceeding (including, without limitation, any threatened investigation or
proceeding) relating to the foregoing, and the Borrowers shall reimburse the
Agent and each Bank, and each Affiliate thereof and their respective directors,
officers, employees and agents, upon demand for any expenses (including, without
limitation, legal fees) incurred in connection with any such investigation or
proceeding; but excluding any such losses, liabilities, claims, damages or
expenses incurred by reason of the gross negligence or wilful misconduct of the
Person to be indemnified; provided, however, that a Borrower shall not be liable
-----------------
under this Section 9.04 in connection with any claim under any cause of action
by or against any Person indemnified under this Section 9.04 with respect to
which and solely to the extent to which such Borrower or an Affiliate of such
Borrower is both (i) adverse to the Person being indemnified with respect to
such claim under such cause of action, and (ii) the prevailing party with
respect to such claim under such cause of action.
SECTION 9.05 Setoff; Sharing of Setoffs. (a) Each Borrower agrees
--------------------------
that the Agent and each Bank shall have a lien for all indebtedness and
obligations owing to them from such Borrower upon all deposits or deposit
accounts, of any kind, or any interest in any deposits or deposit accounts
thereof, now or hereafter pledged, mortgaged, transferred or assigned to the
Agent or any such Bank or otherwise in the possession or control of the Agent or
any such Bank for any purpose for the account or benefit of such Borrower and
including any balance of any deposit account or of any credit of such Borrower
with the Agent or any such Bank, whether now existing or hereafter established
hereby authorizing the Agent and each Bank at any time or times with or without
prior notice to apply such balances or any part thereof to such of the
indebtedness and obligations owing by such Borrower to the Banks and/or the
Agent then past due and in such amounts as they may elect, and whether or not
the collateral, if any, or the responsibility of other Persons primarily,
secondarily or otherwise liable may be deemed adequate. For the purposes of
this paragraph, all remittances and property shall be
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deemed to be in the possession of the Agent or any such Bank as soon as the same
may be put in transit to it by mail or carrier or by other bailee.
(b) Each Bank agrees that if it shall, by exercising any right of
setoff or counterclaim or resort to collateral security or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest owing
with respect to the Note held by it which is greater than the proportion
received by any other Bank in respect of the aggregate amount of all principal
and interest owing with respect to the Note held by such other Bank, the Bank
receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks owing to such other Banks,
and such other adjustments shall be made, as may be required so that all such
payments of principal and interest with respect to the Notes held by the Banks
owing to such other Banks shall be shared by the Banks pro rata; provided that
--------
(i) nothing in this Section shall impair the right of any Bank to exercise any
right of setoff or counterclaim it may have and to apply the amount subject to
such exercise to the payment of indebtedness of the Borrower other than its
indebtedness under the Notes, and (ii) if all or any portion of such payment
received by the purchasing Bank is thereafter recovered from such purchasing
Bank, such purchase from each other Bank shall be rescinded and such other Bank
shall repay to the purchasing Bank the purchase price of such participation to
the extent of such recovery together with an amount equal to such other Bank's
ratable share (according to the proportion of (x) the amount of such other
Bank's required repayment to (y) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. Each Borrower
agrees, to the fullest extent it may effectively do so under applicable law,
that any holder of a participation in a Note, whether or not acquired pursuant
to the foregoing arrangements, may exercise rights of setoff or counterclaim and
other rights with respect to such participation as fully as if such holder of a
participation were a direct creditor of such Borrower in the amount of such
participation.
SECTION 9.06. Amendments and Waivers. (a) Any provision of this
----------------------
Agreement, the Notes, the Parent Guaranty or any other Loan Documents may be
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by the Borrowers or the Parent (with respect to the Parent Guaranty) and
the Required Banks (and, if the rights or duties of the Agent are affected
thereby, by the Agent); provided that, no such amendment or waiver shall, unless
--------
signed by all Banks, (i) change the Commitment of any Bank or subject any Bank
to any additional obligation, (ii) change the principal of or rate of interest
on
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any Loan or any fees (other than fees payable to the Agent) hereunder, (iii)
change the date fixed for any payment of principal of or interest on any Loan or
any fees hereunder, (iv) change the amount of principal, interest or fees due on
any date fixed for the payment thereof, (v) change the percentage of the
Commitments or of the aggregate unpaid principal amount of the Notes, or the
percentage of Banks, which shall be required for the Banks or any of them to
take any action under this Section or any other provision of this Agreement,
(vi) change the manner of application of any payments made under this Agreement
or the Notes, or (vii) release any Guarantee given to support payment of the
Loans.
(b) The Borrowers will not solicit, request or negotiate for or with
respect to any proposed waiver or amendment of any of the provisions of this
Agreement unless each Bank shall be informed thereof by the Borrowers and shall
be afforded an opportunity of considering the same and shall be supplied by the
Borrower with sufficient information to enable it to make an informed decision
with respect thereto. Executed or true and correct copies of any waiver or
consent effected pursuant to the provisions of this Agreement shall be delivered
by the Borrowers to each Bank forthwith following the date on which the same
shall have been executed and delivered by the requisite percentage of Banks.
The Borrowers will not, directly or indirectly, pay or cause to be paid any
remuneration, whether by way of supplemental or additional interest, fee or
otherwise, to any Bank (in its capacity as such) as consideration for or as an
inducement to the entering into by such Bank of any waiver or amendment of any
of the terms and provisions of this Agreement unless such remuneration is
concurrently paid, on the same terms, ratably to all such Banks.
SECTION 9.07. No Margin Stock Collateral. Each of the Banks
--------------------------
represents to the Agent and each of the other Banks that it in good faith is
not, directly or indirectly (by negative pledge or otherwise), relying upon any
Margin Stock as collateral in the extension or maintenance of the credit
provided for in this Agreement.
SECTION 9.08. Successors and Assigns. (a) The provisions of this
----------------------
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns; provided that the Borrower may not
assign or otherwise transfer any of its rights under this Agreement.
(b) Any Bank may at any time sell to one or more Persons (each a
"Participant") participating interests in any Loan owing to such Bank, any Note
held by such Bank, any Commitment hereunder or any other interest of such Bank
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hereunder. In the event of any such sale by a Bank of a participating interest
to a Participant, such Bank's obligations under this Agreement shall remain
unchanged, such Bank shall remain solely responsible for the performance
thereof, such Bank shall remain the holder of any such Note for all purposes
under this Agreement, and the Borrower and the Agent shall continue to deal
solely and directly with such Bank in connection with such Bank's rights and
obligations under this Agreement. In no event shall a Bank that sells a
participation be obligated to the Participant to take or refrain from taking any
action hereunder except that such Bank may agree that it will not (except as
provided below), without the consent of the Participant, agree to (i) the
change of any date fixed for the payment of principal of or interest on the
related loan or loans, (ii) the change of the amount of any principal, interest
or fees due on any date fixed for the payment thereof with respect to the
related loan or loans, (iii) the change of the principal of the related loan or
loans, (iv) any change in the rate at which either interest is payable thereon
or (if the Participant is entitled to any part thereof) fee is payable hereunder
from the rate at which the Participant is entitled to receive interest or fee
(as the case may be) in respect of such participation, (v) the release or
substitution of all or any substantial part of the collateral (if any) held as
security for the Loans, or (vi) the release of any Guarantee given to support
payment of the Loans. Each Bank selling a participating interest in any Loan,
Note, Commitment or other interest under this Agreement, other than a Money
Market Loan or Money Market Loan Note or participating interest therein, shall,
within 10 Domestic Business Days of such sale, provide the Borrowers and the
Agent with written notification stating that such sale has occurred and
identifying the Participant and the interest purchased by such Participant. The
Borrowers agree that each Participant shall be entitled to the benefits of
Article VIII with respect to its participation in Loans outstanding from time to
time.
(c) Subject to the proviso set forth below, any Bank may at any time
assign to one or more banks or financial institutions (each an "Assignee") all,
or in the case of its Syndicated Loans and Commitments, a proportionate part of
all its Syndicated Loans and Commitments, of its rights and obligations under
this Agreement, the Notes and the other Loan Documents, and such Assignee shall
assume all such rights and obligations, pursuant to an Assignment and
Acceptance, executed by such Assignee, such transferor Bank and the Agent (and,
in the case of an Assignee that is not then a Bank, subject to clause (iii)
below, by the Parent); provided that (i) no interest may be sold by a Bank
-------------
pursuant to this paragraph (c) unless the Assignee shall agree to assume ratably
equivalent portions of the transferor Bank's Commitment, (ii) if a Bank is
assigning only a
71
<PAGE>
portion of its Commitment, then, the amount of the Commitment being assigned
(determined as of the effective date of the assignment) shall be in an amount
not less than $10,000,000, and (iii) except during the continuance of a Default,
no interest may be sold by a Bank pursuant to this paragraph (c) to any Assignee
without the prior written consent of the Parent and the Agent, which consent
shall not be unreasonably withheld in connection with a transfer to any Assignee
which is then a Bank. Upon (A) execution of the Assignment and Acceptance by
such transferor Bank, such Assignee, the Agent and (if applicable) the Parent,
(B) delivery of an executed copy of the Assignment and Acceptance to the Parent
and the Agent, (C) payment by such Assignee to such transferor Bank of an amount
equal to the purchase price agreed between such transferor Bank and such
Assignee, and (D) payment of a processing and recordation fee of $2,500 to the
Agent, such Assignee shall for all purposes be a Bank party to this Agreement
and shall have all the rights and obligations of a Bank under this Agreement to
the same extent as if it were an original party hereto with a Commitment as set
forth in such instrument of assumption, and the transferor Bank shall be
released from its obligations hereunder to a corresponding extent, and no
further consent or action by the Parent, the Banks or the Agent shall be
required. Upon the consummation of any transfer to an Assignee pursuant to this
paragraph (c), the transferor Bank, the Agent and the Borrowers shall make
appropriate arrangements so that, if required, new Notes are issued to such
Assignee.
(d) Subject to the provisions of Section 9.09, the Borrowers
authorize each Bank to disclose to any Participant, Assignee or other transferee
(each a "Transferee") and any prospective Transferee any and all financial
information in such Bank's possession concerning the Borrowers which has been
delivered to such Bank by the Borrowers pursuant to this Agreement or which has
been delivered to such Bank by the Borrower in connection with such Bank's
credit evaluation prior to entering into this Agreement.
(e) No Transferee shall be entitled to receive any greater payment
under Section 2.12(d), Section 8.03, or Section 8.05 than the transferor Bank
would have been entitled to receive with respect to the rights transferred,
unless such transfer is made with the Borrower's prior written consent or by
reason of the provisions of Section 8.02 or 8.03 requiring such Bank to
designate a different Lending Office under certain circumstances or at a time
when the circumstances giving rise to such greater payment did not exist.
(f) Anything in this Section 9.08 to the contrary notwithstanding,
any Bank may assign and pledge all or any portion of the Loans and/or
obligations owing to it to any
72
<PAGE>
Federal Reserve Bank or the United States Treasury as collateral security
pursuant to Regulation A of the Board of Governors of the Federal Reserve System
and any Operating Circular issued by such Federal Reserve Bank, provided that
any payment in respect of such assigned Loans and/or obligations made by the
Borrower to the assigning and/or pledging Bank in accordance with the terms of
this Agreement shall satisfy the Borrowers' obligations hereunder in respect of
such assigned Loans and/or obligations to the extent of such payment. No such
assignment shall release the assigning and/or pledging Bank from its obligations
hereunder.
SECTION 9.09. Confidentiality. Each Bank agrees to exercise
---------------
commercially reasonable efforts to keep any information delivered or made
available by the Borrowers to it which is clearly indicated to be confidential
information, confidential from anyone other than persons employed or retained by
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 (i) to any other Bank,
(ii) upon the order of any court or administrative agency, (iii) upon the
request or demand of any regulatory agency or authority having jurisdiction over
such Bank, (iv) which has been publicly disclosed, (v) to the extent reasonably
required in connection with any litigation to which the Agent, any Bank or their
respective Affiliates may be a party, (vi) to the extent reasonably required in
connection with the exercise of any remedy hereunder, (vii) to such Bank's legal
counsel and independent auditors and (viii) to any actual or proposed
Participant, Assignee or other Transferee of all or part of its rights hereunder
which has agreed in writing to be bound by the provisions of this Section 9.09;
provided that should disclosure of any such confidential information be required
- --------
by virtue of clause (ii) of the immediately preceding sentence, any relevant
Bank shall promptly notify the Borrowers of same (unless prohibited by such
order in clause (ii)) so as to allow the Borrower to seek a protective order or
to take any other appropriate action; provided, further, that, no Bank shall be
-------- ------- ----
required to delay compliance with any directive to disclose any such information
so as to allow the Borrowers to effect any such action.
SECTION 9.10. Representation by Banks. Each Bank hereby represents
-----------------------
that it is a commercial lender or financial institution which makes Loans in the
ordinary course of its business and that it will make its Loans hereunder for
its own account in the ordinary course of such business; provided, however that,
-----------------
subject to Section 9.08, the disposition of the Note or Notes held by that Bank
shall at all times be within its exclusive control.
73
<PAGE>
SECTION 9.11. Obligations Several. The obligations of each Bank
-------------------
hereunder are several, and no Bank shall be responsible for the obligations or
commitment of any other Bank hereunder. Nothing contained in this Agreement and
no action taken by the Banks pursuant hereto shall be deemed to constitute the
Banks to be a partnership, an association, a joint venture or any other kind of
entity. The amounts payable at any time hereunder to each Bank shall be a
separate and independent debt, and each Bank shall be entitled to protect and
enforce its rights arising out of this Agreement or any other Loan Document and
it shall not be necessary for any other Bank to be joined as an additional party
in any proceeding for such purpose.
SECTION 9.12. Georgia Law. This Agreement and each Note shall be
-----------
construed in accordance with and governed by the law of the State of Georgia.
SECTION 9.13. Severability. In case any one or more of the provisions
------------
contained in this Agreement, the Notes, the Parent Guaranty or any of the other
Loan Documents should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein and therein shall not in any way be affected or impaired thereby and
shall be enforced to the greatest extent permitted by law.
SECTION 9.14. Interest. In no event shall the amount of interest, and
--------
all charges, amounts or fees contracted for, charged or collected pursuant to
this Agreement, the Notes or the other Loan Documents and deemed to be interest
under applicable law (collectively, "Interest") exceed the highest rate of
interest allowed by applicable law (the "Maximum Rate"), and in the event any
such payment is inadvertently received by any Bank, then the excess sum (the
"Excess") shall be credited as a payment of principal, unless a Borrower shall
notify such Bank in writing that it elects to have the Excess returned
forthwith. It is the express intent hereof that the Borrowers not pay and the
Banks not receive, directly or indirectly in any manner whatsoever, interest in
excess of that which may legally be paid by the Borrower under applicable law.
The right to accelerate maturity of any of the Loans does not include the right
to accelerate any interest that has not otherwise accrued on the date of such
acceleration, and the Agent and the Banks do not intend to collect any unearned
interest in the event of any such acceleration. All monies paid to the Agent or
the Banks hereunder or under any of the Notes or the other Loan Documents,
whether at maturity or by prepayment, shall be subject to rebate of unearned
interest as and to the extent required by applicable law. By the execution of
this Agreement, each Borrower covenants that (i) the credit or return of any
Excess shall constitute the acceptance by such Borrower of such Excess, and (ii)
such
74
<PAGE>
Borrower shall not seek or pursue any other remedy, legal or equitable , against
the Agent or any Bank, based in whole or in part upon contracting for charging
or receiving any Interest in excess of the Maximum Rate. For the purpose of
determining whether or not any Excess has been contracted for, charged or
received by the Agent or any Bank, all interest at any time contracted for,
charged or received from the Borrower in connection with this Agreement, the
Notes or any of the other Loan Documents shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread in equal parts
throughout the full term of the Commitments. The Borrowers, the Agent and each
Bank shall, to the maximum extent permitted under applicable law, (i)
characterize any non-principal payment as an expense, fee or premium rather than
as Interest and (ii) exclude voluntary prepayments and the effects thereof. The
provisions of this Section shall be deemed to be incorporated into each Note and
each of the other Loan Documents (whether or not any provision of this Section
is referred to therein). All such Loan Documents and communications relating to
any Interest owed by the Borrowers and all figures set forth therein shall, for
the sole purpose of computing the extent of obligations hereunder and under the
Notes and the other Loan Documents be automatically recomputed by the Borrowers,
and by any court considering the same, to give effect to the adjustments or
credits required by this Section.
SECTION 9.15. Interpretation. No provision of this Agreement or any
--------------
of the other Loan Documents shall be construed against or interpreted to the
disadvantage of any party hereto by any court or other governmental or judicial
authority by reason of such party having or being deemed to have structured or
dictated such provision.
SECTION 9.16. Waiver of Jury Trial; Consent to Jurisdiction. Each
---------------------------------------------
Borrower (a) and each of the Banks and the Agent irrevocably waives, to the
fullest extent permitted by law, any and all right to trial by jury in any legal
proceeding arising out of this Agreement, any of the other Loan Documents, or
any of the transactions contemplated hereby or thereby, (b) submits to the
nonexclusive personal jurisdiction in the State of Georgia, the courts thereof
and the United States District Courts sitting therein, for the enforcement of
this Agreement, the Notes and the other Loan Documents, (c) waives any and all
personal rights under the law of any jurisdiction to object on any basis
(including, without limitation, inconvenience of forum) to jurisdiction or venue
within the State of Georgia for the purpose of litigation to enforce this
Agreement, the Notes or the other Loan Documents, and (d) agrees that service of
process may be made upon it in the manner prescribed in Section 9.01 for the
giving of notice to the Borrowers. Nothing herein contained,
75
<PAGE>
however, shall prevent the Agent from bringing any action or exercising any
rights against any security and against the Borrower personally, and against any
assets of the Borrowers, within any other state or jurisdiction.
SECTION 9.17. 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 thereto and hereto were upon the same instrument.
SECTION 9.18. Source of Funds -- ERISA. Each of the Banks hereby
------------------------
severally (and not jointly) represents to the Borrowers that no part of the
funds to be used by such Bank to fund the Loans hereunder from time to time
constitutes (i) assets allocated to any separate account maintained by such Bank
in which any employee benefit plan (or its related trust) has any interest nor
(ii) any other assets of any employee benefit plan. As used in this Section,
the terms "employee benefit plan" and "separate account" shall have the
respective meanings assigned to such terms in Section 3 of ERISA.
76
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, under seal, by their respective authorized officers as of the
day and year first above written.
EQUIFAX INC.
By:________________________________________
Title:
1600 Peachtree Street, N.W.
Atlanta, Georgia 30309
Attention: Assistant Treasurer
Telecopier number: (404) 888-3528
Confirmation number: (404) 885-8059
77
<PAGE>
COMMITMENTS WACHOVIA BANK OF GEORGIA, N.A.,
- -----------
as Agent and as a Bank (SEAL)
$100,000,000
- ------------
By:___________________________________
Title:
Lending Office
--------------
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Telecopier number: 404-332-4005
Confirmation number: 404-332-6971
78
<PAGE>
THE FIRST NATIONAL BANK
OF CHICAGO (SEAL)
$75,000,000
----------
By:___________________________________
Title:
Lending Office
--------------
One First National Plaza
Suite 0374
Chicago, Illinois 60670
Attention: Mr. Steven B. Farley
Telecopier number: (312) 732-3885
Confirmation number: (312) 732-5995
79
<PAGE>
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION (SEAL)
$75,000,000
----------
By:___________________________________
Title:
Lending Office
--------------
1230 Peachtree Street
Suite 3600
Atlanta, Georgia 30309
Attention: Mr. Randall Portwood
Telecopier number: (404) 249-6938
Confirmation number: (404) 249-6946
80
<PAGE>
TRUST COMPANY BANK
(SEAL)
$75,000,000
----------
By:____________________________________
Title:
Lending Office
--------------
25 Park Place
23rd Floor
Atlanta, Georgia 30302
Attention: Ms. Julia Taylor
Telecopier number: (404) 588-8833
Confirmation number: (404) 588-8398
81
<PAGE>
NATIONSBANK OF GEORGIA, N.A. (SEAL)
$50,000,000
----------
By:__________________________________
Title:
Lending Office
--------------
600 Peachtree Street, N.E.
21st Floor
Atlanta, Georgia 30308
Attention: Mr. James S. Scully
Telecopier number: (404) 607-5524
Confirmation number: (404) 607-5524
82
<PAGE>
CIBC INC. (SEAL)
$75,000,000
----------
By:___________________________________
Title:
Lending Office
--------------
2727 Paces Ferry Road
Two Paces West, Suite 1200
Atlanta, Georgia 30339
Attention: Mr. Roger Colden
Telecopier number: (404) 319-4954
Confirmation number: (404) 319-4902
83
<PAGE>
MELLON BANK (SEAL)
$50,000,000
----------
By:___________________________________
Title:
Lending Office
--------------
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
Attention: Mr. Clifford A. Mull
Telecopier number: (412) 236-1914
Confirmation number: (412) 236-1196
84
<PAGE>
FIRST UNION NATIONAL BANK OF
GEORGIA (SEAL)
$50,000,000
----------
By:_________________________________
Title:
Lending Office
--------------
999 Peachtree Street, N.E.
11th Floor
Atlanta, Georgia 30309
Attention: Mr. Tom Hackett
Telecopier number: (404) 225-4066
Confirmation number: (404) 827-7229
__________________
TOTAL COMMITMENTS:
$550,000,000
85
<PAGE>
EXHIBIT A-1
-----------
FORM OF SYNDICATED LOAN NOTE
Atlanta, Georgia
August 2, 1995
For value received, ________________, a ___________ corporation (the
"Borrower"), promises to pay to the order of
__________________________________________________, a ____________________ (the
"Bank"), for the account of its Lending Office, the principal sum of
___________________________________ AND NO/100 DOLLARS ($____________), or such
lesser amount as shall equal the unpaid principal amount of each Loan made by
the Bank to the Borrower pursuant to the Credit Agreement referred to below, on
the dates and in the amounts provided in the Credit Agreement. The Borrower
promises to pay interest on the unpaid principal amount of this Syndicated Loan
Note on the dates and at the rate or rates provided for Syndicated Loans in the
Credit Agreement. Interest on any overdue principal of and, to the extent
permitted by law, overdue interest on the principal amount hereof shall bear
interest at the Default Rate, as provided for in the Credit Agreement. All such
payments of principal and interest shall be made in lawful money of the United
States in Federal or other immediately available funds at the office of Wachovia
Bank of Georgia, N.A., 191 Peachtree Street, N.E., Atlanta, Georgia 30303-1757,
or such other address as may be specified from time to time pursuant to the
Credit Agreement.
All Loans made by the Bank, the respective maturities thereof, the
interest rates from time to time applicable thereto, and all repayments of the
principal thereof shall be recorded by the Bank and, prior to any transfer
hereof, endorsed by the Bank on the schedule attached hereto, or on a
continuation of such schedule attached to and made a part hereof; provided that
--------
the failure of the Bank to make any such recordation or endorsement shall not
affect the obligations of the Borrower hereunder or under the Credit Agreement.
This Syndicated Loan Note is one of the Syndicated Loan Notes referred
to in the Credit Agreement dated as of August 2, 1995 among the Equifax Inc.,
its Wholly Owned Subsidiaries parties thereto, the Banks listed on the signature
pages thereof and Wachovia Bank of Georgia, N.A., as Agent (as the same may be
amended and modified from time to time, the "Credit Agreement"). Terms defined
in the Credit Agreement are used herein with the same meanings. Reference is
made to the Credit Agreement for
86
<PAGE>
provisions for the optional and mandatory prepayment and the repayment hereof
and the acceleration of the maturity hereof.
IN WITNESS WHEREOF, the Borrower has caused this Syndicated Loan Note
to be duly executed, under seal, by its duly authorized officer as of the day
and year first above written.
[BORROWER] (SEAL)
By: __________________________
Title:
87
<PAGE>
Syndicated Dollar Note (cont'd)
<TABLE>
<CAPTION>
LOANS AND PAYMENTS OF PRINCIPAL
- --------------------------------------------------------------------------------
Base Rate, Amount Amount of
or Euro- of Principal Maturity Notation
Date Dollar Loan Loan Repaid Date Made By
<S> <C> <C> <C> <C> <C>
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
</TABLE>
88
<PAGE>
EXHIBIT A-2
-----------
DOLLAR MONEY MARKET LOAN NOTE
As of August 2, 1995
For value received, ____________________________, a
___________________________________ (the "Borrower"), promises to pay to the
order of ___________________________________________, a _______________ (the
"Bank"), for the account of its Lending Office, the outstanding principal amount
of each Dollar Money Market Loan made by the Bank to the Borrower pursuant to
the Credit Agreement referred to below, on the dates and in the amounts provided
in the Credit Agreement. The Borrower promises to pay interest on the unpaid
principal amount of each Dollar Money Market Loan on the dates and at the rate
or rates provided for in the Credit Agreement referred to below. Interest on
any overdue principal of and, to the extent permitted by law, overdue interest
on the principal amount hereof shall bear interest at the Default Rate, as
provided for in the Credit Agreement. All such payments of principal and
interest shall be made in lawful money of the United States in Federal or other
immediately available funds at the office of Wachovia Bank of Georgia, N.A., 191
Peachtree Street, N.E., Atlanta, Georgia 30303-1757, or such other address as
may be specified from time to time pursuant to the Credit Agreement.
All Dollar Money Market Loans made by the Bank, the respective
maturities thereof, the interest rates from time to time applicable thereto, and
all repayments of the principal thereof shall be recorded by the Bank and, prior
to any transfer hereof, endorsed by the Bank on the schedule attached hereto, or
on a continuation of such schedule attached to and made a part hereof; provided
--------
that the failure of the Bank to make any such recordation or endorsement shall
not affect the obligations of the Borrower hereunder or under the Credit
Agreement.
This Dollar Money Market Loan Note is one of the Dollar Money Market
Loan Notes referred to in the Credit Agreement dated as of August 2, 1995 among
Equifax Inc., its Wholly Owned Subsidiaries parties thereto, the Banks listed on
the signature pages thereof, Wachovia Bank of Georgia, N.A., as Agent (as the
same may be amended and modified from time to time, the "Credit Agreement").
Terms defined in the Credit Agreement are used herein with the same meanings.
Reference is made to the Credit Agreement for provisions for the optional and
mandatory prepayment and the repayment hereof and the acceleration of the
maturity hereof.
89
<PAGE>
IN WITNESS WHEREOF, the Borrower has caused this Dollar Money Market
Loan Note to be duly executed, under seal, by its duly authorized officer as of
the day and year first above written.
[BORROWER] (SEAL)
By:__________________________________
Title:
90
<PAGE>
Dollar Money Market Loan Note (cont'd)
<TABLE>
<CAPTION>
DOLLAR MONEY MARKET LOANS AND PAYMENTS OF PRINCIPAL
- -------------------------------------------------------------------------------
Amount Amount of Stated
Interest of Principal Maturity Notation
Date Rate Loan Repaid Date Made By
<S> <C> <C> <C> <C> <C>
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
</TABLE>
91
<PAGE>
EXHIBIT A-3
-----------
FOREIGN CURRENCY MONEY MARKET LOAN NOTE
As of August 2, 1995
For value received, ____________________________, a
___________________________________ (the "Borrower"), promises to pay to the
order of ___________________________________________, a _______________ (the
"Bank"), for the account of its Lending Office, the outstanding principal amount
of each Foreign Currency Money Market Loan made by the Bank to the Borrower
pursuant to the Credit Agreement referred to below, on the dates and in the
amounts provided in the Credit Agreement. The Borrower promises to pay interest
on the unpaid principal amount of each Money Market Loan Note on the dates and
at the rate or rates provided for in the Credit Agreement referred to below.
Interest on any overdue principal of and, to the extent permitted by law,
overdue interest on the principal amount hereof shall bear interest at the
Default Rate, as provided for in the Credit Agreement. All such payments of
principal and interest shall be made in lawful money of the applicable Foreign
Currency for each such Foreign Currency Money Market Loan in immediately
available funds at the office of Wachovia Bank of Georgia, N.A., 191 Peachtree
Street, N.E., Atlanta, Georgia 30303-1757, or such other address as may be
specified from time to time pursuant to the Credit Agreement.
All Foreign Currency Money Market Loans made by the Bank, the
respective maturities thereof, Foreign Currency in which made, the interest
rates from time to time applicable thereto, and all repayments of the principal
thereof shall be recorded by the Bank and, prior to any transfer hereof,
endorsed by the Bank on the schedule attached hereto, or on a continuation of
such schedule attached to and made a part hereof; provided that the failure of
--------
the Bank to make any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Credit Agreement.
This Foreign Currency Money Market Loan Note is one of the Foreign
Currency Money Market Loan Notes referred to in the Credit Agreement dated as of
August 2, 1995 among Equifax Inc., its Wholly Owned Subsidiaries parties
thereto, the Banks listed on the signature pages thereof, Wachovia Bank of
Georgia, N.A., as Agent (as the same may be amended and modified from time to
time, the "Credit Agreement"). Terms defined in the Credit Agreement are used
herein with the same meanings. Reference is made to the Credit Agreement for
provisions for the optional and mandatory
92
<PAGE>
prepayment and the repayment hereof and the acceleration of the maturity hereof.
IN WITNESS WHEREOF, the Borrower has caused this Foreign Currency
Money Market Loan Note to be duly executed, under seal, by its duly authorized
officer as of the day and year first above written.
[BORROWER] (SEAL)
By:_____________________________________
Title:
93
<PAGE>
Foreign Currency Money Market Loan Note (cont'd)
<TABLE>
<CAPTION>
FOREIGN CURRENCY MONEY MARKET LOANS AND PAYMENTS OF PRINCIPAL
- ------------------------------------------------------------------------------
Principal
Amount
of Loan
and Amount of Stated
Interest Foreign Principal Maturity Notation
Date Rate Currency Repaid Date Made By
<S> <C> <C> <C> <C> <C>
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
</TABLE>
94
<PAGE>
EXHIBIT B
---------
OPINION OF
COUNSEL FOR THE BORROWER
------------------------
[Dated as provided in Section 3.01 of the Credit
Agreement]
To the Banks and the Agent
Referred to Below
c/o Wachovia Bank of Georgia, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attn: Syndications Group
Dear Sirs:
We have acted as counsel for Equifax Inc., a Georgia corporation (the
"Parent") and its Wholly Owned Subsidiaries (together with the Parent, in its
capacity as a borrower, the "Borrowers") in connection with the Credit Agreement
(the "Credit Agreement") dated as of August 2, 1995, among the Borrowers, the
banks listed on the signature pages thereof and Wachovia Bank of Georgia, N.A.,
as Agent. Terms defined in the Credit Agreement are used herein as therein
defined.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion. We have assumed for purposes of our opinions set
forth below that the execution and delivery of the Credit Agreement by each Bank
and by the Agent have been duly authorized by each Bank and by the Agent.
Upon the basis of the foregoing, we are of the opinion that:
1. The Parent is a corporation duly incorporated, validly existing
and in good standing under the laws of Georgia, each other Borrower is a
corporation duly incorporated, validly existing and in good standing under the
laws of its jurisdiction of incorporation, as set forth on Schedule 4.08 to the
Credit Agreement, and each Borrower and has all corporate powers required to
carry on its business as now conducted.
95
<PAGE>
2. The execution, delivery and performance by the Borrower of the
Credit Agreement and the Notes and, with respect to the Parent, of the Parent
Guaranty (i) are within the Borrowers' or the Parent's corporate powers, (ii)
have been duly authorized by all necessary corporate action, (iii) require no
action by or in respect of, or filing with, any governmental body, agency or
official, (iv) do not contravene, or constitute a default under, any provision
of applicable law or regulation or of the certificate of incorporation or by-
laws of the Borrowers or the Parent or of any agreement, judgment, injunction,
order, decree or other instrument which to our knowledge is binding upon the
Borrowers or the Parent and (v) to our knowledge, except as provided in the
Credit Agreement, do not result in the creation or imposition of any Lien on any
asset of the Borrower or any of its Subsidiaries.
3. The Credit Agreement and, with respect to the Parent, the Parent
Guaranty, constitutes a valid and binding agreement of the Borrowers or the
Parent, enforceable against the Borrowers or the Parent in accordance with its
terms, and the Notes constitute valid and binding obligations of the Borrowers,
enforceable in accordance with their respective terms, except as such
enforceability may be limited by: (i) bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and (ii) general
principles of equity.
4. To our knowledge, there is no action, suit or proceeding pending,
or threatened, against or affecting the Borrowers or any of its Subsidiaries
before any court or arbitrator or any governmental body, agency or official in
which there is a reasonable possibility of an adverse decision which could
materially adversely affect the business, consolidated financial position or
consolidated results of operations of the Parent and its Consolidated
Subsidiaries, considered as a whole, or which in any manner questions the
validity or enforceability of the Credit Agreement or any Note.
5. Each of the Parent's Subsidiaries which is not a Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation, and has all corporate powers and all
material governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted.
6. Neither the Borrowers nor any of the Subsidiaries is an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
7. Neither the Borrowers nor any of the Subsidiaries is a "holding
company", or a "subsidiary company" of a "holding company", or an "affiliate" of
a "holding company" or of a
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"subsidiary company" of a "holding company", as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended.
We are qualified to practice in the State of Georgia and do not purport to
be experts on any laws other than the laws of the United States and the State of
Georgia and this opinion is rendered only with respect to such laws. We have
made no independent investigation of the laws of any other jurisdiction.
This opinion is delivered to you in connection with the transaction
referenced above and may only be relied upon by you, any Assignee, Participant
or other Transferee under the Credit Agreement, and Jones, Day, Reavis & Pogue
without our prior written consent.
Very truly yours,
97
<PAGE>
EXHIBIT C
---------
OPINION OF
JONES, DAY, REAVIS & POGUE, SPECIAL COUNSEL
FOR THE AGENT
---------------
[Dated as provided in Section 3.01 of the Credit Agreement]
To the Banks and the Agent
Referred to Below
c/o Wachovia Bank of Georgia, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attn: Syndications Group
Dear Sirs:
We have participated in the preparation of the Credit Agreement (the
"Credit Agreement") dated as of August 2, 1995, among Equifax Inc., a Georgia
corporation (the "Parent"), its Wholly Owned Subsidiaries parties thereto
(together with the Parent, in its capacity as a borrower, the "Borrowers"), the
banks listed on the signature pages thereof (the "Banks") and Wachovia Bank of
Georgia, N.A., as Agent (the "Agent"), and have acted as special counsel for the
Agent for the purpose of rendering this opinion pursuant to Section 3.01(d) of
the Credit Agreement. Terms defined in the Credit Agreement are used herein as
therein defined.
This opinion letter is limited by, and is in accordance with, the
January 1, 1992 edition of the Interpretive Standards applicable to Legal
Opinions to Third Parties in Corporate Transactions adopted by the Legal Opinion
Committee of the Corporate and Banking Law Section of the State Bar of Georgia
which Interpretive Standards are incorporated herein by this reference.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, and assuming the due authorization,
execution and delivery of the Credit Agreement and each of the Notes by or on
behalf of the Borrower, and the Parent Guaranty by the Parent, we are of the
opinion that the Credit
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Agreement constitutes a valid and binding agreement of the Borrower each Note
constitutes a valid and binding obligations of the Borrower, and the Parent
Guaranty constitutes a valid and binding obligations of the Parent, in each case
enforceable in accordance with its terms except as: (i) the enforceability
thereof may be affected by bankruptcy, insolvency, reorganization, fraudulent
conveyance, voidable preference, moratorium or similar laws applicable to
creditors' rights or the collection of debtors' obligations generally; (ii)
rights of acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability; and (iii) the enforceability
of certain of the remedial, waiver and other provisions of the Credit Agreement
and the Notes may be further limited by the laws of the State of Georgia;
provided, however, such additional laws do not, in our opinion, substantially
interfere with the practical realization of the benefits expressed in the Credit
Agreement, the Notes and the Parent Guaranty, except for the economic
consequences of any procedural delay which may result from such laws.
In giving the foregoing opinion, we express no opinion as to the effect (if
any) of any law of any jurisdiction except the State of Georgia. We express no
opinion as to the effect of the compliance or noncompliance of the Agent or any
of the Banks with any state or federal laws or regulations applicable to the
Agent or any of the Banks by reason of the legal or regulatory status or the
nature of the business of the Agent or any of the Banks.
This opinion is delivered to you in connection with the transaction
referenced above and may only be relied upon by you and any Assignee,
Participant or other Transferee under the Credit Agreement without our prior
written consent.
Very truly yours,
99
<PAGE>
EXHIBIT D
---------
ASSIGNMENT AND ACCEPTANCE
-------------------------
Dated __________ __, ____
Reference is made to the Credit Agreement dated as of August 2, 1995
(together with all amendments and modifications thereto, the "Credit Agreement")
among Equifax Inc., its Wholly Owned Subsidiaries parties thereto (the
"Borrowers"), the Banks from time to time parties thereto and Wachovia Bank of
Georgia, N.A., as Agent (the "Agent"). Terms defined in the Credit Agreement
are used herein with the same meaning.
________________________________________ (the "Assignor") and
_______________________________________ (the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, without
recourse to the Assignor, and the Assignee hereby purchases and assumes from the
Assignor, a ______% interest in and to all of the Assignor's rights and
obligations under the Credit Agreement as of the Effective Date (as defined
below) (including, without limitation, a _____% interest (which on the Effective
Date hereof is $__________) in the Assignor's Commitment and a ______ interest
(which on the Effective Date hereof is $_______________) in the Syndicated Loans
and Money Market Loans owing to the Assignor and a ___% interest in the Notes
held by the Assignor (which on the Effective Date hereof is in the amount and
the Dollar Equivalent of $__________).
2. The Assignor (i) makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant thereto, other
than that it is the legal and beneficial owner of the interest being assigned by
it hereunder, that such interest is free and clear of any adverse claim and that
as of the date hereof its Commitment (without giving effect to assignments
thereof which have not yet become effective) is $__________ and the aggregate
outstanding principal amount of Syndicated Loans owing to it is
$______________[the aggregate principal amount of Dollar Money Market Loans
owing to it is $_________________ and the aggregate principal amount of Foreign
Currency Money Market Loans owing to it is the Dollar Equivalent of $________]
(without giving effect to assignments thereof which have not yet become
effective); (ii) makes no representation or warranty and assumes no
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responsibility with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations under the
Credit Agreement or any other instrument or document furnished pursuant thereto;
and (iii) attaches the Note[s] referred to in paragraph 1 above and requests
that the Agent exchange such Note[s] for [(x)] a new Syndicated Loan Note dated
________________, ____ in the principal amount of $__________ , a new Dollar
Money Market Loan Note dated _________,_____, and a new Foreign Currency Money
Market Loan Note dated __________, ____, each payable to the order of the
Assignee [and (y) a new Syndicated Loan Note dated ________________, ____ in the
principal amount of $_____________ , a new Dollar Money Market Loan Note dated
_________________, ____ and a new Money Market Loan Note dated ______________,
____, each payable to the order of the Assignor].
3. The Assignee (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred to
in Section 4.04(a) thereof (or any more recent financial statements of the
Borrower delivered pursuant to Section 5.01(a) or (b) thereof) and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (ii) agrees
that it will, independently and without reliance upon the Agent, the Assignor or
any other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement; (iii) confirms that it is a bank
or financial institution; (iv) appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (v) agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Bank; (vi) specifies as
its Lending Office (and address for notices) the office set forth beneath its
name on the signature pages hereof, (vii) represents and warrants that the
execution, delivery and performance of this Assignment and Acceptance are within
its corporate powers and have been duly authorized by all necessary corporate
action (viii) makes the representation and warranty contained in Section 9.18 of
the Credit Agreement [, and (ix) attaches the forms prescribed by the Internal
Revenue Service of the United States certifying as to the Assignee's status for
purposes of determining exemption from United States withholding taxes with
respect to all payments to be made to the Assignee under the Credit Agreement
and the Notes or such other documents as are necessary to indicate that all such
payments are subject to such taxes at a rate reduced by an applicable tax
treaty].
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<PAGE>
4. The Effective Date for this Assignment and Acceptance shall be
__________, ____ (the "Effective Date"). Following the execution of this
Assignment and Acceptance, it will be delivered to the Agent for execution and
acceptance by the Agent and to the Borrower for execution by the Borrower.
5. Upon such execution and acceptance by the Agent [and execution by
the Parent] [IF REQUIRED BY THE CREDIT AGREEMENT], from and after the Effective
Date, (i) the Assignee shall be a party to the Credit Agreement and, to the
extent rights and obligations have been transferred to it by this Assignment and
Acceptance, have the rights and obligations of a Bank thereunder and (ii) the
Assignor shall, to the extent its rights and obligations have been transferred
to the Assignee by this Assignment and Acceptance, relinquish its rights (other
than under Sections 8.03, 9.03 and 9.04 of the Credit Agreement) and be released
from its obligations under the Credit Agreement.
6. Upon such execution and acceptance by the Agent [and execution by
the Parent] [IF REQUIRED BY THE CREDIT AGREEMENT], from and after the Effective
Date, the Agent shall make all payments in respect of the interest assigned
hereby to the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments for periods prior to such acceptance by the Agent
directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of Georgia.
[NAME OF ASSIGNOR]
By:___________________________
Title:
[NAME OF ASSIGNEE]
By:___________________________
Title:
Lending Office:
[Address]
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WACHOVIA BANK OF GEORGIA, N.A.,
As Agent
By:__________________________
Title:
[EQUIFAX INC.]
IF REQUIRED BY THE CREDIT AGREEMENT.
By:__________________________
Title:
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<PAGE>
EXHIBIT E
---------
NOTICE OF BORROWING
-------------------
_______________, 199____
Wachovia Bank of Georgia, N.A., as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Re: Credit Agreement (as amended and modified from time to time, the
"Credit Agreement") dated as of August 2, 1995 by and among Equifax
Inc., its Wholly Owned Subsidiaries parties thereto, the Banks from
time to time parties thereto, and Wachovia Bank of Georgia, N.A., as
Agent.
Gentlemen:
Unless otherwise defined herein, capitalized terms used herein shall have
the meanings attributable thereto in the Credit Agreement.
This Notice of Borrowing is delivered to you pursuant to Section 2.02 of
the Credit Agreement.
The Borrower hereby requests a [Euro-Dollar Borrowing] [Base Rate
Borrowing] in the aggregate principal amount of $_______________ to be made on
______________, _____, and for interest to accrue thereon at the rate
established by the Credit Agreement for [Euro- Dollar Loans] [Base Rate Loans].
The duration of the Interest Period with respect thereto shall be [1 month] [2
months] [3 months] [6 months] [30 days].
The Aggregate Outstanding Loans on the date hereof, without giving effect
to the Borrowing requested hereby, is [less than] [equal to or greater than] 50%
of the Aggregate Commitments.
The Borrower has caused this Notice of Borrowing to be executed and
delivered by its duly authorized officer this ______ day of ___________, ______.
[INSERT NAME OF BORROWER]
By:_____________________________________
Title:
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<PAGE>
EXHIBIT F
---------
COMPLIANCE CERTIFICATE
----------------------
Reference is made to the Credit Agreement dated as of August 2, 1995
(as modified and supplemented and in effect from time to time, the "Credit
Agreement") among Equifax Inc., its Wholly Owned Subsidiaries parties thereto,
the Banks from time to time parties thereto, Wachovia Bank of Georgia, N.A., as
Agent. Capitalized terms used herein shall have the meanings ascribed thereto in
the Credit Agreement.
Pursuant to Section 5.01(c) of the Credit Agreement, (i) __________,
the duly authorized ____________________ of Equifax Inc. hereby certifies to the
Agent and the Banks as required by Section 5.01(c) that the information
contained in the Compliance Check List attached hereto is true, accurate and
complete as of __________, ____, and (ii) ____________________, the duly
authorized ________________________________ of Equifax Inc. hereby (A) certifies
to the Agent and the Banks as required by Section 5.01(c) that to the knowledge
of such officer, no Default is in existence on and as of the date hereof and (B)
restates and reaffirms as required by Section 5.01(c) that to the knowledge of
such officer, the representations and warranties contained in Article IV of the
Credit Agreement are true on and as of the date hereof as though restated on and
as of this date.
EQUIFAX INC.
By:____________________________________
Title:
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<PAGE>
COMPLIANCE CHECK LIST
Equifax Inc.
___________________________
_________________, ____
1. Restricted Investments (Section 5.15)
The Parent will not, and will not permit any of its Subsidiaries to, make
any Restricted Investments unless, after giving effect thereto, the
aggregate amount of all such Investments made, together with the aggregate
of all loans and advances permitted by clause (iv) of Section 5.16, does
not exceed the sum of (A) $130,000,000, plus (B) 25% of Consolidated Net
----
Income during each Fiscal Quarter commencing after March 31, 1995 in which
there was a net profit on a consolidated basis and less (C) 100% of
----
Consolidated Net Income during each Fiscal Quarter commencing after March
31, 1995 in which there was a net loss on a consolidated basis; provided
--------
that after giving effect to the making of any Restricted Investments
permitted by this Section, the Borrowers will be in full compliance with
all the provisions of this Agreement.
Loans or Advances (Section 5.16)
Neither the Parent nor any of its Consolidated Subsidiaries shall make
loans or advances to any Person except: (i) loans or advances to and
guaranties in favor of employees in the ordinary course of business; (ii)
deposits required by government agencies or public utilities; (iii)
intercompany loans or advances between the Parent and the Consolidated
Subsidiaries and vice versa; and (iv) loans or advances in an aggregate
amount which, together with Restricted Investments permitted by Section
5.15, do not exceed the sum of (A) $130,000,000, plus (B) 25% of
----
Consolidated Net Income during each Fiscal Quarter commencing after March
31, 1995 in which there was a net profit on a consolidated basis and less
----
(C) 100% of Consolidated Net Income during each Fiscal Quarter commencing
after March 31, 1995 in which there was a net loss on a consolidated basis;
provided that after giving effect to the making of any loans, advances or
--------
deposits permitted by this Section, the Borrowers will be in full
compliance with all the provisions of this Agreement.
(a) Restricted Investments during
current Fiscal Year $_________
(b) Loans and Advances $_________
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<PAGE>
COMPLIANCE CHECK LIST
Equifax Inc.
_____________________________
________________, _____
(c) sum of (a) and (b) $_________
(d) Aggregate Consolidated Net Income for
each Fiscal Quarter commencing after
March 31, 1995 in which there was a net
profit $_________
(e) 25% of (d) $_________
(f) Aggregate Consolidated Net Income for
each Fiscal Quarter commencing after
March 31, 1995 in which there was a net
loss $_________
(g) sum of (e) less (f)
plus $130,000,000 $_________
Limitation (c) not to
exceed (g)
2. Debt of Consolidated Subsidiaries (Section 5.17)
The Borrowers (other than the Parent) shall not, and the Parent shall not
permit any other Consolidated Subsidiary to, incur or permit to exist any
Debt not in existence on the Closing Date, and extensions or renewals
thereof, other than (i) the obligations to the Banks under this Agreement;
(ii) Debt of the types described in clause (vii) of the definition of Debt
which is incurred in the ordinary course of business in connection with (1)
the sale or purchase of goods, or (2) to assure performance of any
Subsidiaries' service contracts, operating leases, obligations to a utility
or a governmental entity, or worker's compensation obligations; and (iii)
Debt (including Debt secured by Liens permitted by Section 5.18) not
exceeding an aggregate amount outstanding at any time equal to 20% of
Consolidated Net Tangible Assets.
(a) Other Debt (described in
clause (iii) above) $_________
(b) Consolidated Net Tangible
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<PAGE>
COMPLIANCE CHECK LIST
Equifax Inc.
___________________________
_________________, ____
Assets - Schedule 1 $_________
(c) 20% of (b) $_________
Limitation (a) not to
exceed (c)
3. Negative Pledge (Section 5.18)
The Borrowers shall not, and the Parent shall not permit any Consolidated
Subsidiary to, create, assume or suffer to exist any Lien on any asset now
owned or hereafter acquired by it, except (i) purchase money security
interests in goods purchased in the ordinary course of business and for
which the purchase price therefor is paid within 120 days of such purchase,
and (ii) Liens securing Debt (other than indebtedness represented by the
Notes) in an aggregate principal amount at any time outstanding which does
not exceed 20% of Consolidated Net Tangible Assets.
(a) Aggregate amount of Debt secured
by Liens $_________
(b) Consolidated Net Tangible Assets
Schedule 1 $_________
(c) 20% of (b) $_________
Limitation (a) not to
exceed (c)
4. Fixed Charge Coverage Ratio (Section 5.19)
At the end of each Fiscal Quarter, commencing with the Fiscal Quarter
ending March 31, 1995, the ratio of Income Available for Fixed Charges to
Consolidated Fixed Charges for the Fiscal Quarter just ended and the
immediately preceding 3 Fiscal Quarters shall not have been less than 2.5
to 1.0; provided, however, that if the CSC Put is funded, such ratio shall
--------
be greater than 2.0 to 1.0 at the end of the Fiscal Quarter in
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<PAGE>
COMPLIANCE CHECK LIST
Equifax Inc.
___________________________
_________________, ____
which the CSC Put is funded and at the end of each of the immediately
succeeding 3 Fiscal Quarters.
(a) Consolidated Net Income - Schedule 2 $_________
(b) interest expense - Schedule 2 $_________
(c) operating leases and rentals - Schedule 2 $_________
(d) taxes - Schedule 2 $_________
(e) sum of (a) plus (b)
plus (c) plus (d) $_________
(f) sum of (b) plus (c) $_________
Ratio of (e) to (f) _________
Requirement more than [2.5 to 1.0]
[2.0 to 1.0]
5. Cash Flow Coverage Ratio (Section 5.20)
At the end of each Fiscal Quarter, the ratio of Net Funded Debt to Cash
Flow for the Fiscal Quarter just ended shall be less than 4.0 to 1.0;
provided, however, that if the CSC Put is funded, such ratio shall be less
--------
than 4.5 to 1.0 at the end of the Fiscal Quarter in which the CSC Put is
funded and at the end of the immediately succeeding 3 Fiscal Quarters.
(a) All Debt $_________
(b) cash and cash equivalents $_________
(c) (a) minus (b) $_________
(d) Consolidated Net Income
Schedule 3 (if CSC Put funded) $_________
(e) depreciation and amortization
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<PAGE>
COMPLIANCE CHECK LIST
Equifax Inc.
___________________________
_________________, ____
Schedule 3 (if CSC Put funded) $_________
(f) other non-cash charges
Schedule 3 (if CSC Put funded) $_________
(g) sum of (d) plus (e)
plus (f) $_________
Ratio of (c) to (g) __________
Requirement less than [4.0 to 1.0]
less than [4.5 to 1.0]
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<PAGE>
COMPLIANCE CHECK LIST
Equifax Inc.
___________________________
_________________, ____
Schedule 1
----------
Consolidated Net Tangible Assets
--------------------------------
(a) Consolidated Total Assets $_________
(b) all intangible assets
under GAAP (other than
"Purchase Date Files") $_________
(c) Capital Stock shown as assets $_________
(d) deferred expenses $_________
(e) sum of (a) less (b)
less (c) less (d) $_________
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<PAGE>
COMPLIANCE CHECK LIST
Equifax Inc.
___________________________
_________________, ____
Schedule - 2
------------
Fixed Charge Coverage
---------------------
Consolidated Net Income for:
_____ quarter 199__ $_________
_____ quarter 199__ $_________
_____ quarter 199__ $_________
_____ quarter 199__ $_________
Total $_________
Interest Expense for:
_____ quarter 199__ $_________
_____ quarter 199__ $_________
_____ quarter 199__ $_________
_____ quarter 199__ $_________
Total $_________
Operating Leases and Rentals for:
_____ quarter 199__ $_________
_____ quarter 199__ $_________
_____ quarter 199__ $_________
_____ quarter 199__ $_________
Total $_________
Taxes for:
_____ quarter 199__ $_________
_____ quarter 199__ $_________
_____ quarter 199__ $_________
_____ quarter 199__ $_________
Total $_________
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COMPLIANCE CHECK LIST
Equifax Inc.
___________________________
_________________, ____
Schedule 3
----------
Cash Flow Coverage
------------------
Consolidated Net Income for:
_____ quarter 199__ $_________
_____ quarter 199__ $_________
Total $_________
Depreciation and Amortization for:
_____ quarter 199__ $_________
_____ quarter 199__ $_________
Total $_________
Other Non-cash Charges for:
_____ quarter 199__ $_________
_____ quarter 199__ $_________
Total $_________
Total $_________
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EXHIBIT G
---------
CLOSING CERTIFICATE
-------------------
Reference is made to the Credit Agreement (the "Credit Agreement") dated as
of August 2, 1995, among Equifax Inc., its Wholly Owned Subsidiaries parties
thereto, the Banks listed therein, and Wachovia Bank of Georgia, N.A., as Agent.
Capitalized terms used herein have the meanings ascribed thereto in the Credit
Agreement.
Pursuant to Section 3.01(e) of the Credit Agreement, ______________________
______, the duly authorized ____________________ of Equifax Inc. hereby
certifies to the Agent and the Banks as required by Section 3.01(e) that (i) no
Default has occurred and is continuing as of the date hereof, and (ii) the
representations and warranties contained in Article IV of the Credit Agreement
are true on and as of the date hereof.
Certified as of this 2nd day of August, 1995.
EQUIFAX, INC.
By:________________________________
Printed Name:___________________
Title:__________________________
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EXHIBIT H
---------
MONEY MARKET QUOTE REQUEST
--------------------------
Wachovia Bank of Georgia, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Re: Money Market Quote Request
--------------------------
This Money Market Quote Request is given in accordance with Section 2.03 of
the Credit Agreement (as amended or modified from time to time, the "Credit
Agreement") dated as of August 2, 1995, among EQUIFAX INC, its Wholly Owned
Subsidiaries parties thereto, the Banks from time to time parties thereto, and
WACHOVIA BANK OF GEORGIA, N.A., as Agent. Terms defined in the Credit Agreement
are used herein as defined therein.
The Parent, on behalf of the Borrower listed below, hereby requests that
the Agent obtain quotes for a Money Market Borrowing based upon the following:
1. The Borrower for the requested Money Market Borrowing is
_______________________, a __________________ corporation, and the
proposed date of the Money Market Borrowing shall be ______________,
____ (the "Money Market Borrowing Date")./1/*
2. The Money Market Borrowing shall be [a Dollar Money Market Borrowing]
[a Foreign Currency Money Market Borrowing to be made in the following
Foreign Currency: ______________].
3. The aggregate amount of the [Dollar Money Market Borrowing] [Foreign
Currency Money Market Borrowing] shall be [[__]______________________,
being the Dollar Equivalent of] $________________./2/
4. The Stated Maturity Date(s) applicable to the Money Market Borrowing
shall be ______ days./3/
__________________________
* All numbered footnotes appear on the last page of this Exhibit H.
---------
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<PAGE>
Very truly yours,
EQUIFAX INC., on behalf of the
above named Borrower.
By:_________________________________
Title:
__________________________
/1/ The date must be a Euro-Dollar Business Day, with respect to a Dollar Money
Market Borrowing, or a Foreign Currency Business Day, with respect to a
Foreign Currency Money Market Borrowing.
/2/ The amount of the Money Market Borrowing is subject to Section 2.03(a) and
(b).
/3/ The Stated Maturity Dates are subject to Section 2.03(b)(ii). The Borrower
may request that up to 2 different Stated Maturity Dates be applicable to
any Money Market Borrowing, provided that (i) each such Stated Maturity
--------
Date shall be deemed to be a separate Money Market Quote Request and (ii)
the Borrower shall specify the amounts of such Money Market Borrowing to be
subject to each such different Stated Maturity Date.
116
<PAGE>
EXHIBIT I
---------
MONEY MARKET QUOTE
------------------
Wachovia Bank of Georgia, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Re: Money Market Quote to [name of requesting Borrower]
---------------------------------------------------
This Money Market Quote is given in accordance with Section
2.03(c)(ii) of the Credit Agreement (as amended or modified from time to time,
the "Credit Agreement") dated as of August 2, 1995, among EQUIFAX INC. and its
Wholly Owned Subsidiaries parties thereto (the "Borrowers"), the Banks from time
to time parties thereto, and WACHOVIA BANK OF GEORGIA, N.A., as Agent. Terms
defined in the Credit Agreement are used herein as defined therein.
In response to the Money Market Quote Request of Equifax Inc. on
behalf of [name of requesting Borrower] dated ____________, ____, we hereby make
the following Money Market Quote on the following terms:
1. Quoting Bank:
2. Person to contact
at Quoting Bank:
3. Date of Money Market Borrowing:/1/*
4. We hereby offer to make Money Market Loan(s) in the following maximum
principal amounts for the following Interest Periods and at the following rates:
<TABLE>
<CAPTION>
Maximum Stated
Principal Maturity
Amount /2/ Date /3/ Rate Per Annum /4/
-------- -------- ---- --- -----
<S> <C> <C>
</TABLE>
5. Applicable withholding taxes, if any:
6. Total "all-in" rate (excluding the Adjusted IBOR Rate if a Foreign
Currency Money Market Borrowing):
__________________________
* All numbered footnotes appear on the last page of this Exhibit I.
---------
117
<PAGE>
We understand and agree that the offer(s) set forth above, subject to
the satisfaction of the applicable conditions set forth in the Credit Agreement,
irrevocably obligate(s) us to make the Money Market Loan(s) for which any
offer(s) [is] [are] accepted, in whole or in part (subject to the last sentence
of Section 2.03(c)(i) of the Credit Agreement).
Very truly yours,
[Name of Bank]
Dated: By: ______________________________
Authorized Officer
______________________________
______________________________
/1/ As specified in the related Money Market Quote Request.
/2/ The principal amount bid for each Stated Maturity Date may not exceed the
principal amount requested. Money Market Quotes must be made for at least
(x) with respect to a Dollar Money Market Borrowing, $5,000,000 or a larger
multiple of $1.000,000 and (y) with respect to a Foreign Currency Money
Market Borrowing, the Dollar Equivalent of $1,000,000 or a larger multiple
of the Dollar Equivalent of $500,000.
/3/ The Stated Maturity Dates are subject to Section 2.03(b)(iii).
/4/ Subject to Section 2.03(c)(ii)(C).
118
<PAGE>
EXHIBIT J
---------
FORM OF PARENT GUARANTY
-----------------------
THIS GUARANTY (this "Guaranty") is made as of the 2nd day of August,
1995, by EQUIFAX INC., a Georgia corporation (the "Guarantor") in favor of the
Agent, for the ratable benefit of the Banks, under the Credit Agreement referred
to below;
W I T N E S S E T H
WHEREAS, pursuant to a Credit Agreement dated as of even date herewith
(as amended or modified from time to time, the "Credit Agreement", the
Guarantor, as a Borrower, its Wholly Owned Subsidiaries parties thereto, as
Borrowers thereunder from time to time, (all such Borrowers, other than the
Guarantor, being collectively or individually, as the context shall require,
referred to as the "Principal" or the "Principals"), the Banks parties thereto
from time to time, and WACHOVIA BANK OF GEORGIA, N.A., as Agent (the "Agent"),
the Banks have provided, subject to the terms and conditions thereof, for
extensions of credit to be made by the Banks to the Principals and the Guarantor
for the benefit of the Principals and of the Guarantor;
WHEREAS, it is a condition precedent to the Agent and the Banks
executing the Credit Agreement that the Guarantor execute and deliver this
Guaranty whereby the Guarantor shall guarantee the payment when due of all
principal, interest and other amounts that shall be at any time payable by the
Principals under the Credit Agreement, the Notes and the other Loan Documents;
and
WHEREAS, in consideration of the financial and other support that the
Principals have provided, and such financial and other support as the Principals
may in the future provide, to Guarantor, and in order to induce the Banks and
the Agent to enter into the Credit Agreement, the Guarantor is willing to
guarantee the obligations of the Principals under the Credit Agreement, the
Notes, and the other Loan Documents;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
119
<PAGE>
SECTION 1. Definitions. Terms defined in the Credit Agreement and
-----------
not otherwise defined herein have, as used herein, the respective meanings
provided for therein.
SECTION 2. Representations and Warranties. The Guarantor
------------------------------
incorporates herein by reference as fully as if set forth herein all of its
representations and warranties contained in Article V of the Credit Agreement
(which representations and warranties shall be deemed to have been renewed by
the Guarantor upon each Borrowing under the Credit Agreement).
SECTION 3. The Guaranty. The Guarantor hereby unconditionally
------------
guarantees the full and punctual payment (whether at stated maturity, upon
acceleration or otherwise) of the principal of and interest on each Note issued
by the Principals pursuant to the Credit Agreement, and the full and punctual
payment of all other amounts payable by the Principals under the Credit
Agreement and the other Loan Documents, including without limitation, all fees,
costs, expenses, compensation amounts and indemnification amounts (all of the
foregoing obligations being referred to collectively as the "Guaranteed
Obligations"). Upon failure by the Principals to pay punctually any such amount,
the Guarantor agrees that it shall forthwith on demand pay the amount not so
paid at the relevant place and in the manner and relevant currency specified in
the Credit Agreement, the relevant Note or the relevant Loan Document, as the
case may be, together with interest on amounts recoverable under this Guaranty
from the time such amounts become due until payment, at the Default Rate.
SECTION 4. Guaranty Unconditional. The obligations of the Guarantor
----------------------
hereunder shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(i) any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of the Principals under the Credit
Agreement, any Note, or any other Loan Document, by operation of law or
otherwise or any obligation of any other guarantor of any of the
Obligations;
(ii) any modification or amendment of or supplement to the
Credit Agreement, any Note, or any other Loan Document;
(iii) any release, nonperfection or invalidity of any direct or
indirect security for any obligation of the Principals under the Credit
Agreement, any Note, any Loan Document, or any obligations of any other
guarantor of any of the Guaranteed Obligations;
(iv) any change in the corporate existence, structure or
ownership of the Principals or any other guarantor of any of the Guaranteed
Obligations, or any
120
<PAGE>
insolvency, bankruptcy, reorganization or other similar proceeding
affecting the Principals, or any other guarantor of the Guaranteed
Obligations, or its assets or any resulting release or discharge of any
obligation of the Principals, or any other guarantor of any of the
Guaranteed Obligations;
(v) the existence of any claim, setoff or other rights which the
Guarantor may have at any time against the Principals, any other guarantor
of any of the Guaranteed Obligations, the Agent, any Bank or any other
Person, whether in connection herewith or any unrelated transactions,
provided that nothing herein shall prevent the assertion of any such claim
by separate suit or compulsory counterclaim;
(vi) any invalidity or unenforceability relating to or against
the Principals, or any other guarantor of any of the Guaranteed
Obligations, for any reason related to the Credit Agreement, any other Loan
Document, or any other Guaranty, or the lack of legal existence of any
Principal, or any provision of applicable law or regulation purporting to
prohibit or make illegal the payment by the Principals, or any other
guarantor of the Guaranteed Obligations, of the principal of or interest on
any Note or any other amount payable by the Principals under the Credit
Agreement, the Notes, or any other Loan Document, or the performance of any
other obligation or undertaking of any of the Principals under the Credit
Agreement, any other Loan Document, or any other Guaranty or otherwise
making any of the Guaranteed Obligations irrecoverable from any of the
Principals for any reason;
(vii) any law, regulation, order, decree or directive (whether
or not having the force of law) or any interpretation thereof, now or
hereafter in effect in any jurisdiction, that purports to modify any of the
terms of or rights of any Bank with respect to any Guaranteed Obligation or
under the Credit Agreement or any other Loan Document or this Guaranty,
including without limitation any law, regulation, order, decree or
directive or interpretation thereof that purports to require or permit the
satisfaction of any Guaranteed Obligation other than strictly in accordance
with the terms of the Credit Agreement or any other Loan Document (such as
by the tender of a currency other than the relevant Foreign Currency) or
that restricts the procurement of the Foreign Currency by any Borrower or
the Guarantor, or any agreement, whether or not signed by or on behalf of
any Bank, in connection with the restructuring or rescheduling of public or
private obligations in any Borrower's country, whether or not such
agreement is stated to cause or permit the
121
<PAGE>
discharge of the Guaranteed Obligations prior to the final payment in full
of the Guaranteed Obligations in the relevant Foreign Currency in strict
accordance with the Credit Agreement or other Loan Documents; or
(viii) any other act or omission to act or delay of any kind by
the Principals, any other guarantor of the Guaranteed Obligations, the
Agent, any Bank or any other Person or any other circumstance whatsoever
which might, but for the provisions of this paragraph, constitute a legal
or equitable discharge of the Guarantor's obligations hereunder.
SECTION 5. Discharge Only Upon Payment In Full; Reinstatement In
-----------------------------------------------------
Certain Circumstances. The Guarantor's obligations hereunder shall remain in
- ---------------------
full force and effect until all Guaranteed Obligations shall have been paid in
full and the Commitments under the Credit Agreement shall have terminated or
expired. If at any time any payment of the principal of or interest on any Note
or any other amount payable by the Principals under the Credit Agreement or any
other Loan Document is rescinded or must be otherwise restored or returned upon
the insolvency, bankruptcy or reorganization of the Principals or otherwise, the
Guarantor's obligations hereunder with respect to such payment shall be
reinstated as though such payment had been due but not made at such time.
SECTION 6. Waiver of Notice by the Guarantor. The Guarantor
---------------------------------
irrevocably waives acceptance hereof, presentment, demand, protest and, to the
fullest extent permitted by law, any notice not provided for herein, as well as
any requirement that at any time any action be taken by any Person against the
Principals, any other guarantor of the Guaranteed Obligations, or any other
Person.
SECTION 7. Stay of Acceleration. If acceleration of the time for
--------------------
payment of any amount payable by the Principals under the Credit Agreement, any
Note or any other Loan Document is stayed upon the insolvency, bankruptcy or
reorganization of the Principals, all such amounts otherwise subject to
acceleration under the terms of the Credit Agreement, any Note or any other Loan
Document shall nonetheless be payable by the Guarantor hereunder forthwith on
demand by the Agent made at the request of the Required Banks.
SECTION 8. Notices. All notices, requests and other communications
-------
to any party hereunder shall be given or made by telecopier or other writing and
telecopied or mailed or delivered to the intended recipient at its address or
telecopier number set forth on the signature pages hereof or such other address
or telecopy number as such party may hereafter specify for such purpose by
notice to the Agent in
122
<PAGE>
accordance with the provisions of Section 10.01 of the Credit Agreement. Except
as otherwise provided in this Guaranty, all such communications shall be deemed
to have been duly given when transmitted by telecopier, or personally delivered
or, in the case of a mailed notice, 72 hours after such communication is
deposited in the mails with first class postage prepaid, in each case given or
addressed as aforesaid.
SECTION 9. No Waivers. No failure or delay by either Agent or any
----------
Banks in exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies provided in this Guaranty, the Credit
Agreement, the Notes, and the other Loan Documents shall be cumulative and not
exclusive of any rights or remedies provided by law.
SECTION 10. Successors and Assigns. This Guaranty is for the benefit
----------------------
of the Agent and the Banks and their respective successors and assigns and in
the event of an assignment of any amounts payable under the Credit Agreement,
the Notes, or the other Loan Documents, the rights hereunder, to the extent
applicable to the indebtedness so assigned, may be transferred with such
indebtedness. This Guaranty may not be assigned by the Guarantor without the
prior written consent of the Agent and the Required Banks, and shall be binding
upon the Guarantor and its successors and permitted assigns.
SECTION 11. Changes in Writing. Neither this Guaranty nor any
------------------
provision hereof may be changed, waived, discharged or terminated orally, but
only in writing signed by the Guarantor and the Agent with the consent of the
Required Banks.
SECTION 12. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
---------------------------------------------------------
TRIAL. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
- -----
LAW OF THE STATE OF GEORGIA. EACH OF THE GUARANTOR AND THE AGENT HEREBY SUBMITS
TO THE NONEXCLUSIVE JURISDICTION OF THE STATE OF GEORGIA, THE COURTS THEREOF AND
THE UNITED STATES DISTRICT COURTS SITTING THEREIN, AND FOR PURPOSES OF ALL LEGAL
PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS
CONTEMPLATED HEREBY. THE GUARANTOR IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT
ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. EACH OF THE GUARANTOR AND THE AGENT HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
123
<PAGE>
PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
SECTION 13. Taxes, etc. All payments required to be made by the
----------
Guarantor hereunder shall be made without setoff or counterclaim and free and
clear of and without deduction or withholding for or on account of, any present
or future taxes, levies, imposts, duties or other charges of whatsoever nature
imposed by any government or any political or taxing authority as required
pursuant to Sections 2.12(d) and 3.11(d) of the Credit Agreement.
SECTION 14. Failure to Pay in Foreign Currency. If the Guarantor is
----------------------------------
unable for any reason to effect payment in a relevant Foreign Currency as
required by this Guaranty or if the Guarantor shall default in the Foreign
Currency, each Bank may, through the Agent, require such payment to be made in
Dollars in the Dollar Equivalent amount of such payment. In any case in which
the Guarantor shall make such payment in Dollars, the Guarantor agrees to hold
the Banks harmless from any loss incurred by the Banks arising from any change
in the value of Dollars in relation to such Foreign Currency between the date
such payment became due and the date of payment thereof.
SECTION 15. Judgment Currency. If for the purpose of obtaining
-----------------
judgment in any court or enforcing any such judgment it is necessary to convert
any amount due in any Foreign Currency into any other currency, the rate of
exchange used shall be the Agent's spot rate of exchange for the purchase of the
Foreign Currency with such other currency at the close of business on the
Foreign Currency Business Day preceding the date on which judgment is given or
any order for payment is made. The obligation of the Guarantor in respect of any
amount due from it hereunder shall, notwithstanding any judgment or order for a
liquidated sum or sums in respect of amounts due hereunder or under any judgment
or order in any other currency or otherwise be discharged only to the extent
that on the Foreign Currency Business Day following receipt by the Agent of any
payment in a currency other than the relevant Foreign Currency the Agent is able
(in accordance with normal banking procedures) to purchase the relevant Foreign
Currency with such other currency. If the amount of the relevant Foreign
Currency that the Agent is able to purchase with such other currency is less
than the amount due in the relevant Foreign Currency, notwithstanding any
judgment or order, the Guarantor shall indemnify the Banks for the shortfall.
SECTION 16. Subrogation. The Guarantor hereby agrees that it will
-----------
not exercise any rights which it may acquire by way of subrogation under this
Guaranty, by any payment made hereunder or otherwise, unless and until all of
124
<PAGE>
the Guaranteed Obligations shall have been paid in full. If any amount shall be
paid to the Guarantor on account of such subrogation rights at any time when all
of the Guaranteed Obligations shall not have been paid in full, such amount
shall be held in trust for the benefit of the Agent and the Banks and shall
forthwith be paid to the Agent to be credited and applied upon the Guaranteed
Obligations, whether matured or unmatured, in accordance with the terms of the
Credit Agreement.
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly
executed by its authorized officer as of the date first above written.
EQUIFAX INC.
By:_____________________________________
Title:
________________________________________
________________________________________
Attention: _____________________________
Telecopier number: _____________________
Confirmation number: ___________________
125
<PAGE>
EXHIBIT K
---------
BORROWER ACKNOWLEDGEMENT AND AGREEMENT
--------------------------------------
As of the _____ day of ________________________, the undersigned (the
"Additional Borrower"), a wholly-owned subsidiary of Equifax Inc. (the
"Parent"), hereby elects, under Section 2.14 of that certain $550,000,000 Credit
Agreement dated as of ______________, 1995, by and among the Parent, certain of
the Parent's other subsidiaries, the Banks listed therein, and Wachovia Bank of
Georgia, N.A. (the "Agent"; as amended or otherwise modified from time to time,
the "Credit Agreement") to become a "Borrower" as defined in clause [(i) or
(ii)] of the definition of "Borrower" under Section 1.01 of the Credit Agreement
and agrees as such to become hereby subject to all obligations, liabilities,
representations, warranties, covenants, terms, conditions, and other provisions
applicable to a Borrower under the Credit Agreement. The Additional Borrower
delivers this Acknowledgement and Agreement along with: (i) original
counterparts hereof to the Agent to be delivered to the Banks, (ii) an original
of each of the Notes issued by the Additional Borrower as set forth in Section
3.01(b) of the Credit Agreement, and (iii) other items required by a Borrower to
be delivered under Section 3.01 of the Credit Agreement, as the same may be
required by the Agent.
IN WITNESS WHEREOF, the Additional Borrower has caused this
Acknowledgment and Agreement to be duly executed, under seal, by its authorized
officer as of the day and year first above written.
[Additional Borrower]
By:_____________________________________
Title:
________________________________________
________________________________________
Attention: _____________________________
Telecopier number: _____________________
Confirmation number: ___________________
126
<PAGE>
EXHIBIT L
---------
BORROWER NOTICE OF WITHDRAWAL
-----------------------------
As of the _____ day of ________________________, the undersigned (the
"Withdrawing Borrower"), a wholly-owned subsidiary of Equifax Inc. (the
"Parent"), hereby gives notice to the Agent, under Section 2.14 of that certain
$550,000,000 Credit Agreement dated as of ______________, 1995, by and among the
Parent, certain of the Parent's other subsidiaries, the Banks listed therein,
and Wachovia Bank of Georgia, N.A. (the "Agent"; as amended or otherwise
modified from time to time, the "Credit Agreement") of its intention to withdraw
as a "Borrower" as defined in clause [(i) or (ii)] of the definition of
"Borrower" under Section 1.01 of the Credit Agreement and that it has made
payment in full of all Loans outstanding to the Withdrawing Borrower in
immediately available funds (including any amounts owed in connection therewith
under Article VIII of the Credit Agreement).
IN WITNESS WHEREOF, the Withdrawing Borrower has caused this Notice of
Withdrawal to be duly executed, under seal, by its authorized officer as of the
day and year first above written.
[Withdrawing Borrower]
By:_____________________________________
Title:
________________________________________
________________________________________
________________________________________
Attention: _____________________________
Telecopier number: _____________________
Confirmation number: ___________________
127
<PAGE>
Schedule 4.08
-------------
Compliance with ERISA
---------------------
[TO BE COMPLETED BY THE PARENT]
128
<PAGE>
Schedule 4.08
-------------
Consolidated Subsidiaries
-------------------------
Name
- ----
Jurisdiction of Incorporation
- -----------------------------
[TO BE COMPLETED BY THE PARENT]
Subsidiaries Which Are Not Consolidated Subsidiaries
----------------------------------------------------
Name
- ----
Jurisdiction of Incorporation
- -----------------------------
[TO BE COMPLETED BY THE PARENT]
129
<PAGE>
Schedule 4.14
-------------
Environmental Matters
[TO BE COMPLETED BY THE PARENT]
130
<PAGE>
Schedule 4.15
-------------
Capital Stock
[TO BE COMPLETED BY THE PARENT]
131
<PAGE>
Schedule 5.12
-------------
Hazardous Materials
[TO BE COMPLETED BY THE PARENT]
132
<PAGE>
EXHIBIT 10.2
------------
EQUIFAX INC. INCENTIVE COMPENSATION PLAN
- ----------------------------------------
During 1995, certain Executive Officers of the Company participated in the
Equifax Inc. Incentive Compensation Plan. The 1995 Plan is filed herewith.
<PAGE>
EQUIFAX INC.
INCENTIVE COMPENSATION PLAN (ICP)
I. PURPOSE
The Equifax Inc. Incentive Compensation Plan rewards eligible employees for
their contribution toward the success of the Corporation. The purpose of the
Plan is to encourage and reward the attainment of established annual individual
and business goals.
II. DEFINITIONS
The following words and phrases used in the Plan shall have these meanings:
"Committee" means the Chairman of the Executive Committee, the Chief
-----------
Executive Officer, and the Corporate Vice President of Compensation and
Benefits Administration of Equifax Inc. In addition, the Chief Financial
Officer of the corporation shall serve as an ex officio member.
"Corporation" means the amalgam of all divisions and companies,
-------------
domestic and foreign, including equity accounting entities consolidated
with Equifax Inc. for financial reporting purposes.
"Employee" means any salaried employee of the Corporation who
----------
qualifies for participation in the Plan.
"EPS" - "Earnings Per Share" means the net income per share after
-----
taxes for Equifax Inc. on a consolidated basis. In the event extraordinary
transactions occur during a plan year which impact EPS and the Management
Compensation Committee of the Board of Directors of Equifax Inc. approves
adjustments to EPS for the Executive Incentive Plan, similar adjustments
will apply to this Plan.
"EVA" "Economic Value Added" means the net income after taxes less the
-----
charge for employed capital.
"Equifax Inc." means the corporate entity.
--------------
"Incentive Year" means the 12 month period from January 1 through
----------------
December 31, coinciding with the calendar year and the fiscal year of
Equifax Inc.
"Plan" means the Equifax Inc. Incentive Compensation Plan.
------
1
<PAGE>
"Salary" means the base salary earnings of each participant for the
--------
calendar year or that portion of the calendar year for which the
participant is eligible.
III. ADMINISTRATION
The Plan shall be administered by the Corporate Compensation Department,
consistent with guidelines established by the Committee from time to time. The
Plan shall be construed and administered in accordance with the laws of the
State of Georgia.
IV. ELIGIBILITY FOR PARTICIPATION
Employees eligible to participate in the ICP are those salaried employees that
do not participate in any other incentive plan.
Eligibility is also extended to employees in this group at the beginning of the
Incentive Year but who were changed to another non-eligible status and continued
employment in the latter status through the Incentive Year, or those entering
the eligible group during the year. In either event, their incentive will be
calculated only on Salary for that portion of the year they were eligible.
Participants who leave the company following three months of participation for
military service during the incentive period; who, with the consent of the
corporation, retire after reaching age 55 during the incentive period; who die
or who are forced to leave because of disability or job elimination during the
incentive period; are also eligible for participation. If a participant
terminates employment during the plan period for any other reason, no award is
payable under the plan.
A participant in one of these situations receives a prorated portion of his or
her incentive award at target levels at the end of the incentive period in which
the termination occurs. The prorated award is paid within 30 days of
termination. If a participant's employment terminates between the end of a
performance period and the award payment date for that period for any reason
other than an immediately dismissable offense, the full award earned for the
period will be paid.
If a participant's employment is terminated during this period for any
immediately dismissable offense, no award will be paid, unless otherwise
required by law.
If a participant terminates employment prior to the delivery of any incentive
payment earned to accept employment with an Equifax competitor, or to
independently compete with Equifax, no award will be paid.
2
<PAGE>
V. DETERMINATION OF AWARDS
For each fiscal year the Committee will establish a minimum EPS/EVA goal for the
Corporation for Plan purposes. If the Corporation fails to meet the minimum
EPS/EVA for the year, then the Committee may in its sole discretion authorize
incentive payments to any, all, or none of the participants in the Plan based on
such considerations as the Committee deems appropriate.
If the Corporation does meet the minimum EPS/EVA for the year, incentive awards
will be determined on the basis of actual performance during the Incentive Year
as compared with established goals, as described below, and as indicated on the
attachment to this Plan.
- The Committee shall establish the target level of Corporate
EPS/EVA, as well as the corporate EPS/EVA level necessary for the
maximum incentive award, for each participant.
- the target level of business unit goals applicable to participate
shall be based on the annual business plan and other relevant data.
- Individual performance goals will be established by the appropriate
management authority for each participant.
- The committee will approve the relative weighting of the above-
mentioned goals for each participant.
- A target incentive award and a maximum incentive award shall be
established for each participant, expressed in terms of a percentage
of that participant's salary for the Incentive Year.
Individual incentive awards will be deemed earned based upon the degree to which
all established goals are attained for the Incentive Year. Interpolation will
be used between designated award levels for the Plan Year. In the event a
participant is rated "below full attainment" on his individual performance
goals, no incentive payment is awarded except at the discretion of the
appropriate management authority.
Eligible employees transferred into or out of organizational entities covered by
this Plan will be paid incentive for the month in the specific unit. Those
employees eligible for participation for a portion of the year will receive an
award applicable only to the Salary for that portion of the year eligible under
this Plan.
3
<PAGE>
Eligible earnings include base salary only. Transfer reimbursements, relocation
pay, station allowance, severance, and payments made as vacation pay in lieu of
time off to retirees and those leaving the company for military service or
health disability are excluded from the incentive calculation. Salary received
while on Salary Continuance is considered eligible for incentive pay
calculations.
VI. PAYMENT OF AWARDS
Awards will normally be paid to eligible participants as soon as possible
following the close of the Plan Year.
VII. LIMITATIONS
The Committee is the final authority for administration and interpretation of
this Plan and each determination by the Committee shall be binding and
conclusive for all purposes.
No individual (or an individual's personal representative) who, during the
course of an Incentive Year, leaves active employment with the Corporation for
any reason other than retirement, military service, death, disability, or job
elimination shall presume any claim or right to be granted an award under this
Plan for any part of that year.
If at any time prior to the payment of an incentive award for a plan year the
Committee determines that a participant has committed an act of fraud or
dishonesty with respect to the Corporation, such participant shall forfeit any
incentive award to which he otherwise may have been entitled.
VIII. TERM OF THE PLAN
The Plan shall continue from year to year at the discretion of the committee.
In keeping with its purposes, the Committee will review the Plan annually and
will consider any modification which are consistent with the objectives of the
Plan and the financial condition of the Corporation.
IX. EFFECTIVE DATE
This Plan, as amended and restated, shall become effective for the 1995 plan
year.
X. AMENDMENTS
4
<PAGE>
The Committee may amend, suspend or terminate this Plan at any time.
5
<PAGE>
EXHIBIT 10.3
EQUIFAX INC.
------------
DEFERRED COMPENSATION PLAN
--------------------------
(Amended and Restated
as of January 1, 1994)
<PAGE>
EQUIFAX INC.
------------
DEFERRED COMPENSATION PLAN
--------------------------
(Amended and Restated
as of January 1, 1994)
TABLE OF CONTENTS
-----------------
<TABLE>
<S> <C> <C>
Article 1. Establishment and Purpose
-------------------------------------
1.1 Establishment of Plan 1
1.2 Purpose of Plan 1
1.3 Applicability of Plan 1
Article II. Definitions
------------------------
2.1 Account 2
2.2 Affiliate 2
2.3 Beneficiary 2
2.4 Board 2
2.5 Bonus 3
2.6 Code 3
2.7 Committee 3
2.8 Company 3
2.9 Director Fees 3
2.10 Employee 3
2.11 Employer 3
2.12 Entry Date 3
2.13 Financial Hardship 3
2.14 Investment Fund 4
2.15 Nonemployee Director 4
2.16 Participant 4
2.17 Plan 4
2.18 Plan Year 4
2.19 Termination of Service 4
2.20 Valuation Date 4
Article III. Eligibility and Participation
-------------------------------------------
3.1 Eligibility 5
3.2 Participation 5
Article IV. Contributions
--------------------------
4.1 Deferrals 6
</TABLE>
-1-
<PAGE>
EQUIFAX INC.
------------
DEFERRED COMPENSATION PLAN
--------------------------
(Amended and Restated
as of January 1, 1994)
TABLE OF CONTENTS
-----------------
(Continued)
<TABLE>
<S> <C> <C>
Article V. Participants' Accounts
----------------------------------
5.1 Investment of Accounts 8
5.2 Valuation of Accounts 9
5.3 Financing 9
5.4 Unsecured Interest 10
5.5 Nontransferability 10
Article VI. Payment of Accounts
--------------------------------
6.1 Payments to Participant 11
6.2 Distribution Elections 11
6.3 Payments to Beneficiary 13
Article VII. Administration
----------------------------
7.1 Administration 15
7.2 Appeals from Denial of Claims 16
7.3 Tax Withholding 17
7.4 Expenses 17
Article VIII. Adoption of the Plan by Affiliate;
-------------------------------------------------
Amendment and Termination of the Plan
-------------------------------------
8.1 Adoption of the Plan by Affiliate 18
8.2 Amendment and Termination 18
Article IX. Miscellaneous Provisions
-------------------------------------
9.1 No Contract of Employment 19
9.2 Severability 19
9.3 Applicable Law 19
</TABLE>
-2-
<PAGE>
EQUIFAX INC.
------------
DEFERRED COMPENSATION PLAN
--------------------------
(Amended and Restated
as of January 1, 1994)
Article 1. Establishment and Purpose
-------------------------------------
1.1 Establishment of Plan. Equifax Inc. previously established the
---------------------
Equifax Deferred Bonus Compensation Plan effective as of July 1, 1977. The plan
was last amended and restated as of January 1, 1981. The plan is hereby further
amended and restated as of January 1, 1994 and shall now be known as the Equifax
Inc. Deferred Compensation Plan (the "Plan").
The Plan is an unfunded plan of deferred compensation for a select group of
management or highly compensated employees. The Plan, therefore, is intended to
be exempt from the participation, vesting, funding, and fiduciary requirements
of Title I of the Employee Retirement Income Security Act of 1974.
1.2 Purpose of Plan. The purpose of the Plan is to provide eligible
---------------
Employees and Nonemployee Directors with an effective means of deferring all or
a portion of bonus payments, retainer fees, and meeting fees they are entitled
to receive.
1.3 Applicability of Plan. The provisions of this Plan are applicable
---------------------
only to--
(a) Employees who are employed by an Employer on or after January 1, 1994;
and
(b) individuals who are serving as Nonemployee Directors on or after July
1, 1994.
-1-
<PAGE>
Article II. Definitions
------------------------
Whenever used in this Plan, the following terms shall have the meanings set
forth below unless otherwise expressly provided. When the defined meaning is
intended, the term is capitalized. The definition of any term in the singular
shall also include the plural, whichever is appropriate in the context.
2.1 "Account" means the bookkeeping account maintained for each
-------
Participant that represents the Participant's total interest under the Plan as
of any Valuation Date. An Account shall consist of the sum of deferrals of
Bonus or Director Fees credited pursuant to section 4.1, and any gains and
losses credited on these amounts. A Participant shall have a fully vested and
nonforfeitable interest at all times in his or her Account.
2.2 "Affiliate" means any corporation, association, joint venture,
---------
proprietorship, or partnership while it is connected with the Company through
stock ownership, common control, membership in an affiliated service group, or
otherwise within the meaning of Code section 414(b), (c), (m), or (o).
2.3 "Beneficiary" means the person or persons designated by the
-----------
Participant to receive any benefits payable on behalf of the Participant after
his or her death. Each Participant shall designate his or her Beneficiary (or
change this designation) at a time and in a manner specified by the Committee.
If no person is designated as a Beneficiary, if a designation is revoked, or if
no designated Beneficiary survives the Participant, the Beneficiary shall be the
Participant's estate.
2.4 "Board" means the Board of Directors of the Company.
-----
-2-
<PAGE>
2.5 "Bonus" means an Employee's incentive bonus awarded under the
-----
Management Incentive Plan, the Executive Incentive Plan, or other similar plan
providing incentive compensation for a period of performance of one year or
less.
2.6 "Code" means the Internal Revenue Code of 1986, as amended, or as it
----
may be amended from time to time.
2.7 "Committee" means the committee appointed by the Board to administer
---------
the Plan.
2.8 "Company" means Equifax Inc. or any successor thereto.
-------
2.9 "Director Fees" mean the annual retainer and any meeting fees paid by
-------------
the Company to a Nonemployee Director for duties performed as a member of the
Board.
2.10 "Employee" means any person who is employed by an Employer.
--------
2.11 "Employer" means the Company and any Affiliate that elects to become a
--------
party to the Plan with the approval of the Company.
2.12 "Entry Date" means January 1, April 1, July 1, or October 1.
----------
2.13 "Financial Hardship" means a severe financial hardship resulting from
------------------
a sudden and unexpected illness or accident of the Participant or one of his or
her dependents, loss of the Participant's property due to casualty, or other
similar unforeseeable circumstance arising from events that are beyond the
control of the Participant. The existence of a Financial Hardship shall be
determined by the Committee in a manner
-3-
<PAGE>
consistent with Treasury regulations and rulings of the Internal Revenue
Service. The Committee's decision with respect to the existence of a Financial
Hardship shall be final and binding.
2.14 "Investment Fund" means any fund designated by the Committee as an
---------------
investment medium for the deemed investment of a Participant's Account. There
shall be--
(a) a Prime Rate Fund, effective January 1, 1994, which shall have
earnings based on the prime lending rate (determined as of the first
day of each month) as reported in the Wall Street Journal; and
(b) an Equifax Common Stock Fund, effective July 1, 1994.
The Committee shall have the discretion to establish and terminate Investment
Funds as it may deem appropriate.
2.15 "Nonemployee Director" means a member of the Board who is not an
--------------------
Employee of the Company.
2.16 "Participant" means an individual who has met and continues to meet
-----------
the eligibility requirements described in section 3.1.
2.17 "Plan" means this Equifax Inc. Deferred Compensation Plan, as it may
----
be amended from time to time.
2.18 "Plan Year" means the calendar year.
---------
2.19 "Termination of Service" means--
----------------------
(a) for an Employee, a separation from employment with the Company and its
Affiliates; and
(b) for a Nonemployee Director, the date on which such individual ceases
to be a member of the Board.
2.20 "Valuation Date" means the last business day of each
--------------
-4-
<PAGE>
Plan Year and any other date that the Committee selects in its sole discretion
for the revaluation and adjustment of Accounts.
-5-
<PAGE>
Article III. Eligibility and Participation
-------------------------------------------
3.1 Eligibility. An individual shall be eligible to participate in this
-----------
Plan if he or she--
(a) is a Nonemployee Director; or
(b) is an Employee who is a member of a select group of management or
highly compensated Employees, and who is designated by the Committee
as eligible to participate in the Plan.
3.2 Participation.
-------------
(a) Commencement of Participation.
-----------------------------
(1) Nonemployee Directors. A Nonemployee Director shall be eligible
---------------------
to become a Participant as of the later of--
(A) July 1, 1994, or
(B) the Entry Date next following the date on which he or she
first becomes a Nonemployee Director.
(2) Employees. An Employee who was eligible to participate in this
---------
Plan as of December 31, 1993, shall continue to be a Participant
as of January 1, 1994 provided he or she still satisfies the
eligibility requirements of section 3.1(b). Other Employees shall
be eligible to participate as of the Entry Date next following
the date on which he or she satisfies the eligibility
requirements of section 3.1(b).
(b) Duration of Participation. A Participant shall continue to be an
-------------------------
active Participant until he or she ceases to meet the eligibility
requirements under section 3.1 or revokes a deferral election under
section 4.1(b). Thereafter, he or she shall be an inactive Participant
and shall retain all the rights
-6-
<PAGE>
described under this Plan.
-7-
<PAGE>
Article IV. Contributions
--------------------------
4.1 Deferrals.
---------
(a) Election of Deferral.
--------------------
(1) General Rule. Prior to the first day of each Plan Year--
------------
(A) a Nonemployee Director may elect to defer up to 100 percent
(in 1 percent increments or a specified dollar amount) of
the Director Fees that would otherwise be payable to the
Nonemployee Director for the Plan Year; and
(B) a Participant not described in subparagraph (A) may elect to
defer up to 100 percent (in 1 percent increments or a
specified dollar amount) of the Bonus that would otherwise
be payable to the Participant for the Plan Year.
In accordance with procedures established by the Committee, a
Nonemployee Director may make separate deferral elections under
paragraph (A) with respect to retainer fees and meeting fees.
(2) New Participants. In the case of a deferral election which
----------------
becomes effective on a date other than the first day of a Plan
Year, the election shall relate only to--
(A) Director Fees which have not yet been earned as of the
Participant's Entry Date; or
(B) Bonus attributable to the portion of the Plan Year beginning
on the Participant's Entry Date.
(3) Allocation to Accounts. Each deferral of Director Fees or Bonus
----------------------
under this section 4.1 shall be credited to the Participant's
Account as of the date when the amount deferred would have been
paid
-8-
<PAGE>
to the Participant.
(b) Revocation of Election. After the beginning of a Plan Year, a
----------------------
Participant may not increase, decrease, or revoke the amount of
Director Fees or Bonus deferred for that Plan Year.
(c) Default Elections. If an individual participates under the Plan for a
-----------------
given Plan Year, but does not file a timely election form for the next
Plan Year, such individual shall be deemed to elect for the next Plan
Year the same deferrals of Bonus or Director Fees elected for the
prior Plan Year.
-9-
<PAGE>
Article V. Participants' Accounts
----------------------------------
5.1 Investment of Accounts.
----------------------
(a) Investment of Accounts. For each Plan Year, each Participant shall
----------------------
elect in writing to deem to have the deferrals made on his or her
behalf invested in any one or more of the Investment Funds in 10
percent increments. A Participant may change his or her deemed
investment elections with respect to future deferrals as of any
January 1. The Participant shall make or change an election of
Investment Funds by giving notice to the Committee at a time and in a
manner specified by the Committee.
(b) Investment Transfers.
--------------------
(1) General Rule. Except as otherwise provided in paragraph (2)
------------
below, each Participant may elect as of any January 1 to have the
amounts that are deemed invested in any one or more of the
Investment Funds transferred to any one or more of the other
Investment Funds in increments of 10 percent.
(2) Section 16 Participants. Each Participant who is subject to the
-----------------------
reporting and short-swing profit recovery rules of section 16 of
the Securities Exchange Act of 1934 may not transfer previously
deferred amounts into or out of the Equifax Common Stock Fund.
(3) Election Procedures. A Participant shall make an election to
-------------------
transfer among Investment Funds under this subsection (b) by
giving notice to the Committee at a time and manner specified by
the Committee.
-10-
<PAGE>
(c) Committee Discretion. Notwithstanding any provision in this section
--------------------
5.1 to the contrary, the Committee, in its sole and absolute
discretion, may disregard the Participant's investment elections and
deem the Participant's Account to be invested in any manner it
chooses. If the Committee deems the Participant's Account to be
invested in a manner other than that elected by the Participant under
subsections (a) and (b), it shall notify the Participant in advance of
its deemed investment selection. The Company shall incur no liability
on account of its selection of deemed investments or on account of the
performance of those investments.
5.2 Valuation of Accounts.
---------------------
(a) Allocation of Earnings and Losses. A Participant's Account shall be
---------------------------------
adjusted as of each Valuation Date to reflect any gains or losses that
would have been credited or debited to the Account if it had actually
been invested in the manner described in section 5.1. Amounts paid
from Accounts between these dates will be credited or charged for any
investment gains or losses since the last Valuation Date.
(b) Charges Against Account. Any payments made to a Participant or
-----------------------
Beneficiary under Article VI shall be charged against the
Participant's Account.
5.3 Financing. The benefits under this Plan shall be paid out of the
---------
general assets of the Employer, except to the extent they are paid from the
assets of a grantor trust established by an Employer to pay these benefits.
Whether to establish such a trust is a matter that is within the sole and
absolute discretion of the Employer.
-11-
<PAGE>
5.4 Unsecured Interest. No Participant shall have any interest whatsoever
------------------
in any specific asset of the Employer. To the extent that any person acquires a
right to receive payments under this Plan, this right shall be no greater than
the right of any unsecured general creditor of the Employer.
5.5 Nontransferability. In no event shall an Employer make any payment
------------------
under this Plan to any assignee or creditor of a Participant or Beneficiary.
Prior to the time of payment hereunder, no Participant or Beneficiary shall have
any right by way of anticipation or otherwise to assign or otherwise dispose of
any interest under this Plan, nor shall rights be assigned or transferred by
operation of law.
-12-
<PAGE>
Article VI. Payment of Accounts
--------------------------------
6.1 Payments to Participant.
-----------------------
(a) Commencement of Payments. Payment of a Participant's Account shall
------------------------
begin within 90 days after the date determined under section 6.2(a).
(b) Form of Payments. All amounts payable to a Participant shall be
----------------
distributed in a single sum or in a series of installments, as
provided under section 6.2(b).
6.2 Distribution Elections.
----------------------
(a) Time of Payment.
---------------
(1) General Rule. Upon making the initial deferral election under
------------
section 4.1, the Participant shall also designate the date on
which payments from his or her Account shall begin. A Participant
may elect initially to have payments begin as of:
(A) a date specified by the Participant which must be at least
one year after the end of the Plan Year for which the
initial deferral is made; or
(B) the date of the Participant's Termination of Service.
(2) Second Election. If a Participant makes an initial election
---------------
under paragraph (1)(A), he or she may then elect, with respect to
deferrals made after that date, to have payments begin as of:
(A) a date specified by the Participant which must be at least
one year after the end of the Plan Year containing the date
specified under paragraph (1)(A); or
(B) the date of the Participant's Termination of Service.
-13-
<PAGE>
(3) Administrative Rules. If a Participant specifies a date other
--------------------
than Termination of Service for the distribution of his or her
Account, but incurs a Termination of Service or dies before such
date, payments shall begin as soon as practicable following such
earlier Termination of Service or death.
If a Participant specifies a distribution date which precedes his
or her Termination of Service, the amount distributable shall
equal the Account as of such specified date. Deferrals made under
section 4.1 after such specified date or dates shall be payable
upon the Participant's Termination of Service.
(4) Financial Hardship. A Participant may withdraw all or part of
------------------
his or her Account before the distribution date specified in
paragraph (1) or (2) above in the event of a Financial Hardship.
A withdrawal under this paragraph (4) shall not exceed the amount
necessary to satisfy the Financial Hardship. A Participant may
request a hardship withdrawal in accordance with procedures
established by the Committee.
A Participant who is subject to the reporting and short-swing
profit rules of section 16 of the Securities Exchange Act of 1934
may not make a withdrawal under this paragraph (4).
(b) Form of Payment.
---------------
(1) General Rule. At the time a Participant makes his or her initial
------------
deferral election under section 4.1, the Participant shall
separately elect the manner in which his or her Account shall
-14-
<PAGE>
be paid--
(A) to the Participant, upon the date determined under
subsection (a)(1); and
(B) to his or her Beneficiary, upon the Participant's death
prior to the complete distribution of his or her Account.
Additionally, a Participant who makes a second payment election
under subsection (a)(2) shall be permitted to make a payment form
election at the same time he or she makes the second election
under subsection (a)(2).
The Participant may choose to have the Account paid either in a
lump sum (within 90 days of the distribution date determined
under subsection (a)) or in a series of annual installments over
a fixed number of years (not to exceed ten years).
(2) Limitation on Elections. A Participant shall be permitted to
-----------------------
elect a different payment form for amounts that are distributable
as of different payment dates under subsection (a).
(c) Discretion of Committee. Notwithstanding a Participant's election of
-----------------------
the time or form of payment for his or her Account, the Committee may
direct, in its sole and absolute discretion, that the Account shall be
distributed in any time, and/or in any form, permitted under
subsection (a) or (b).
6.3 Payments to Beneficiary.
-----------------------
(a) Commencement of Payments. If a Participant dies before his or her
------------------------
Account has been completely distributed, the remaining balance shall
be paid to the Participant's Beneficiary beginning within 90 days
after the Participant's death.
-15-
<PAGE>
(b) Form of Payments. Payments to the Beneficiary shall be made in a
----------------
single sum or in a series of installments, as provided under section
6.2.
(c) Death of Participant and Beneficiary. If the Participant and
------------------------------------
Beneficiary both die before the Participant's Account has been
completely distributed, these remaining benefits shall be paid as
follows.
(1) If the Beneficiary dies before the Participant, the balance of
the Participant's Account shall be paid to the Participant's
estate in a single sum.
(2) If the Beneficiary dies after the Participant, the balance of the
Participant's Account shall be paid to the Beneficiary's estate
in a single sum.
-16-
<PAGE>
Article VII. Administration
----------------------------
7.1 Administration. The Plan shall be administered by the Committee. A
--------------
majority of the members of the Committee at the time in office shall constitute
a quorum for the transaction of business. All resolutions and other actions
taken by the Committee at any meeting shall be by a majority vote of those
present at the meeting. Upon the unanimous concurrence in writing of all
Committee members, action of the Committee may be taken other than at a meeting.
The Committee shall have all powers necessary or appropriate to carry out the
provisions of the Plan. It may, from time to time, establish rules for the
administration of the Plan and the transaction of the Plan's business.
The Committee shall have the exclusive right to make any finding of fact
necessary or appropriate for any purpose under the Plan including, but not
limited to, the determination of eligibility for and amount of any benefit.
The Committee shall have the exclusive right to interpret the terms and
provisions of the Plan and to determine any and all questions arising under the
Plan or in connection with its administration, including, without limitation,
the right to remedy or resolve possible ambiguities, inconsistencies, or
omissions by general rule or particular decision, all in its sole and absolute
discretion.
All findings of fact, determinations, interpretations, and decisions of the
Committee shall be conclusive and binding upon all persons having or claiming to
have any interest or right under the Plan and shall be given the maximum
possible deference allowed by law.
-17-
<PAGE>
7.2 Appeals from Denial of Claims. If any claim for benefits under the
-----------------------------
Plan is wholly or partially denied, the claimant shall be given notice in
writing of the denial. This notice shall be in writing, within a reasonable
period of time after receipt of the claim by the Committee. This period shall
not exceed 90 days after receipt of the claim, except that if special
circumstances require an extension of time, written notice of the extension
shall be furnished to the claimant, and an additional 90 days will be considered
reasonable.
This notice shall be written in a manner calculated to be understood by the
claimant and shall set forth the following information:
(a) the specific reasons for the denial;
(b) specific reference to the Plan provisions on which the denial is
based;
(c) a description of any additional material or information necessary for
the claimant to perfect the claim and an explanation of why this
material or information is necessary;
(d) an explanation that a full and fair review by the Committee of the
decision denying the claim may be requested by the claimant or an
authorized representative by filing with the Committee, within 60 days
after the notice has been received, a written request for the review;
and
(e) if this request is so filed, an explanation that the claimant or an
authorized representative may review pertinent documents and submit
issues and comments in writing within the same 60-day period specified
in subsection (d).
The decision of the Committee upon review shall be made promptly, and not later
than 60 days after the Committee's receipt of the request for review, unless
special circumstances require an
-18-
<PAGE>
extension of time for processing. In this case the claimant shall be so
notified, and a decision shall be rendered as soon as possible, but not later
than 120 days after receipt of the request for review. If the claim is denied,
wholly or in part, the claimant shall be given a copy of the decision promptly.
The decision shall be in writing, shall include specific reasons for the denial,
shall include specific references to the pertinent Plan provisions on which the
denial is based, and shall be written in a manner calculated to be understood by
the claimant.
7.3 Tax Withholding. The Employer may withhold from any payment under
---------------
this Plan any federal, state, or local taxes required by law to be withheld with
respect to the payment and any sum the Employer may reasonably estimate as
necessary to cover any taxes for which they may be liable and that may be
assessed with regard to the payment.
7.4 Expenses. All expenses incurred in the administration of the Plan
--------
shall be paid by the Employer.
-19-
<PAGE>
Article VIII. Adoption of the Plan by Affiliate;
-------------------------------------------------
Amendment and Termination of the Plan
-------------------------------------
8.1 Adoption of the Plan by Affiliate. An Affiliate may adopt the Plan by
---------------------------------
appropriate action of its board of directors or authorized officers or
representatives, subject to the approval of the Board.
8.2 Amendment and Termination. The Company hereby reserves the right to
-------------------------
amend, modify, or terminate the Plan at any time, and for any reason, by action
of the Board. However, no amendment or termination shall adversely affect
benefits accrued prior to the date of the amendment or termination.
-20-
<PAGE>
Article IX. Miscellaneous Provisions
-------------------------------------
9.1 No Contract of Employment. Nothing contained in the Plan shall be
-------------------------
construed to give any Participant the right to be retained in the service of an
Employer or to interfere with the right of an Employer to discharge a
Participant at any time.
9.2 Severability. If any provision of this Plan shall be held illegal or
------------
invalid, the illegality or invalidity shall not affect its remaining parts. The
Plan shall be construed and enforced as if it did not contain the illegal or
invalid provision.
9.3 Applicable Law. Except to the extent preempted by applicable federal
--------------
law, this Plan shall be governed by and construed in accordance with the laws of
the state of Georgia.
* * * * * * * * * *
IN WITNESS WHEREOF, EQUIFAX INC. has caused this instrument to be executed
by its duly authorized officer, effective as of the date specified above.
EQUIFAX INC.
By: __________________________
Title: _______________________
ATTEST:
By: ________________________
Title: _____________________
-21-
<PAGE>
EXHIBIT 10.7
December 29, 1995
Mr. Daniel W. McGlaughlin
3430 Tuxedo Road
Atlanta, GA 30305
Dear Dan:
In connection with your recent election as Chief Executive Officer of Equifax
Inc. (the "Company"), effective January 1, 1996, you have requested that your
employment agreement, dated June 22, 1989, as amended July 1, 1991, be further
amended to provide for certain enhanced retirement benefits. I am pleased to
inform you that the Management Compensation Committee of the Board of Directors
has approved the amendment of your employment agreement as reflected below, at
its meeting on December 15, 1995. This letter also summarizes the protection
which exists in the event there is a change in control of the Company and your
death benefits pursuant to the basic life insurance plan, the Equifax Inc. U.S.
Retirement Income Plan (Retirement Plan) and your employment agreement.
In consideration of your continuing employment with the Company and under the
terms of our prior agreement, as amended, this letter shall serve to further
amend Paragraphs 5.1 and 5.2 and to add Paragraphs 5.3 and 5.4 to that agreement
so that said paragraphs read as follows:
5.1 Retirement Benefits. Should you retire at age 59 or thereafter, your
--------------------
annual retirement benefit will be paid according to the terms and conditions of
the Supplemental Executive Retirement Plan (SERP) (although you are not
currently a participant in the SERP, and the benefits provided by this agreement
are in lieu of such participation) and the Retirement Plan, except that the
benefits payable under the Retirement Plan shall be supplemented to the extent
necessary to provide aggregate annual payments according to the following
schedule:
<PAGE>
Page 2
<TABLE>
<CAPTION>
Annual Retirement Benefit
(including benefits payable
Age at Retirement under the Retirement Plan)
------------------ --------------------------
<S> <C>
59 30% of Final Average Earnings
61 40% of Final Average Earnings
62 50% of Final Average Earnings
63 60% of Final Average Earnings
64 60% of Final Average Earnings
65 60% of Final Average Earnings
</TABLE>
For the purposes of this agreement, Final Average Earnings shall have the
expanded definition contained in the SERP as it exists on the date of this
amendment.
5.2 Disability. Should you incur a disability within the meaning of the
-----------
Company's long-term disability plan (whether or not you are covered by said
plan), while you are still actively employed by the Company, you will be
entitled to receive retirement benefits, according to Section 5.1 above reduced
by the amount of benefits available to you under the Retirement Plan at that
date, whether or not you actually elect to receive benefits under the Retirement
Plan.
5.3. Change in Control. In the event of a change in control of the Company, [as
------------------
defined in the Change in Control Agreement, dated August 1, 1989, between you
and the Company ("Change in Control Agreement")], if you would be entitled to a
benefit under Paragraph 5 (iii) (c) of said agreement, you shall be entitled to
retirement benefits as of the date of said event, equivalent to 60% of Final
Average Earnings as defined in paragraph 5.1 above (regardless of your age at
that time), plus the net benefit, if any, payable under the Change in Control
Agreement Paragraph 5 (iii) (c).
5.4 Death Benefits. In the event of your death during employment, a death
---------------
benefit will be paid according to the terms and conditions contained in the
Retirement Plan, taking into consideration the enhanced retirement benefits
described in 5.1 above. The total benefit calculated in this manner will be
paid from two sources: the Retirement Plan and the additional amount from the
Company through the trust established for the payments of non- qualified
benefits to executives. In addition, you are eligible for a death benefit under
the basic life insurance plan which is a function of base compensation and years
of service.
<PAGE>
Page 3
Except as specifically modified hereby, the terms of your agreements with the
Company dated June 22, 1989, August 1, 1989 and July 1, 1991 remain in full
force and effect.
Please indicate your concurrence with the foregoing by signing in the space
provided below.
Sincerely,
C. B. Rogers, Jr.
Chairman and Chief Executive Officer
Agreed to this ______ day of _________ ,1996.
__________________________________________
D. W. McGlaughlin
<PAGE>
Exhibit 10.8
CONSULTING AGREEMENT
This Agreement, made and entered into by and between C. B. Rogers, Jr., a
resident of Atlanta, Georgia (hereinafter referred to as "Rogers"), and EQUIFAX
INC., a Georgia corporation with its principal place of business in Atlanta,
Georgia (hereinafter referred to as the "Company"), as of the 1st day of
January, 1996.
WITNESSETH:
WHEREAS, Rogers has served as a Director of and has been employed by the
Company since 1987, and has during that period developed substantial expertise
in the information services industry, and has, over the years, provided valuable
services to the Company in various executive capacities, including the capacity
of Chief Executive Officer of the Company, and has been elected and currently
serves as Chairman of the Board of the Company; and
WHEREAS, Rogers has retired from the employment of the Company under the
retirement provisions of the Equifax Inc. United States Retirement Income Plan,
effective December 31, 1995; and
WHEREAS, the Company wishes to retain the services of Rogers in the
capacity of an independent consultant for the purposes more fully described
below, and Rogers desires to provide services from time to time in said
capacity;
NOW, THEREFORE, in consideration of the premises and the mutual promises
contained herein, the receipt and sufficiency of which are hereby acknowledged,
Rogers
1
<PAGE>
- 2 -
and the Company agree as follows:
1. The Company hereby retains the services of Rogers for a period from
the date hereof through December 31, 1999, in the capacity of an independent
consultant for the purpose of advising the Company and its subsidiaries as to
various matters including international expansion, governmental and community
relations and attraction of new customers and maintenance of existing ones, from
time to time. Rogers shall be available, on reasonable notice, to administer
special projects assigned to him by the Chief Executive Officer or the Board of
Directors.
It is recognized that the provision of said services is not amenable to the
establishment of a routine or schedule, and that Rogers will provide said
services in the manner he deems best, based upon his own experience and
judgment, and shall consult with the Chief Executive Officer of the Company, as
required, concerning said services. Rogers will not be subject to the control
or direction of the Company as to the means to be employed by him in the
accomplishment of his tasks, nor shall he be required to work any particular
number of hours or according to a schedule during the term of this Agreement.
It is not anticipated that Rogers shall devote his full time to the provision of
said services; however, Rogers agrees to be available to provide services for at
least 13 weeks during a year, and the Company agrees that Rogers cannot be asked
to provide such services more than 26 weeks during a year without his consent.
It is acknowledged by the parties that, at the time of execution of this
Agreement,
<PAGE>
- 3 -
Rogers is serving as Chairman of the Board of Directors of the Company and as
Chairman of the Executive Committee of the Board of Directors of the Company,
and it is anticipated that Rogers may be reelected to said positions from time
to time in the future. The duties assigned to Rogers pursuant to this Agreement
are separate and distinct from those of the Chairman of the Board of Directors,
whose duties are described in the Company's By-laws, and which include presiding
at meetings of the Board and of the shareholders, and as Chairman of the
Executive Committee. For service as a Director or as Chairman of the Executive
Committee, Rogers shall receive such compensation as is provided by the
Company's By-Laws, inasmuch as he is not an employee or a salaried officer of
the company, pursuant to Article III thereof. If the Chairman of the Board is
provided an office and administrative services by the Company, Rogers may use
said office and services for purposes of his consulting services as well.
2. In exchange for the provision of those services described in Section 1
above, the Company agrees to pay Rogers the annual amount of Two Hundred Fifty
Thousand and no hundredth dollars ($250,000.00). Said amount shall be paid in
equal monthly installments during the term hereof. The Company shall reimburse
Rogers for his expenses reasonably incurred in the provision of said services.
As a consultant and independent contractor, Rogers shall not be entitled to
participate in any benefit or incentive plans maintained by the Company for its
employees, except in the manner that other retired employees or directors are
entitled to participate.
<PAGE>
- 4 -
3. Rogers shall be free to perform the services required hereby at any
location he desires, consistent with the goals to be accomplished. Rogers will
specifically not be required to maintain an office at the Company's headquarters
for his consulting services although office facilities may be made available to
him from time to time at said location if in the discretion of the Company said
provision will facilitate the accomplishment of said goals. Rogers shall not be
required to use said facilities. Rogers shall be permitted to hire others, at
his own expense, to assist him in the provision of the services to be rendered
hereunder, although it is acknowledged by the parties that it is Rogers personal
knowledge and abilities which are the primary subject of this Agreement.
4. Rogers shall be free to consult with and render services to other
companies during the term of this Agreement; provided, however, that Rogers
shall not consult for any other business entity the business of which is in
direct competition with the primary businesses of the Company.
5. In the event of Rogers' death or disability (as defined in the Equifax
Inc. United States Retirement Plan as it may be amended from time to time) prior
to the expiration of the term of this Agreement, this Agreement shall terminate
and no further payments shall be payable hereunder by the Company, except that
any payments accrued for prior services rendered shall be paid to Rogers or to
his estate.
6. Payments provided for hereunder are independent of any payments to
<PAGE>
- 5 -
which Rogers, his estate or designated beneficiaries may be entitled pursuant to
any employee benefit plan maintained by the Company during Rogers' prior
employment thereby.
7. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and any successor or successors to the business of the
Company; provided, however, that Rogers shall not be entitled to encumber, sell
and otherwise dispose of his right to receive the payments provided for in this
Agreement, which payments and the right thereto are expressly declared to be
non-assignable and non-transferable. In the event of any attempted assignment
or transfer of said rights, the Company shall have no further liability under
this Agreement.
8. This Agreement may be terminated by either party upon sixty (60) days'
written notice. If the Company terminates this Agreement for any reason,
(including termination in the event of a change in control of the Company),
other than as a result of Rogers' failure to perform his duties hereunder (after
receipt of written notice of said failure and a period of thirty (30) days in
which to cure said failure), the Company shall immediately pay Rogers the
remaining payments called for hereunder through the full term hereof.
9. This Agreement shall be construed according to the laws of the State
of Georgia. If any part of this Agreement shall be deemed unenforceable under
law, the remaining provisions hereof shall continue to be in force without
regard to said part.
<PAGE>
- 6 -
10. This Agreement is executed in two counterparts, each which shall take
effect as an original and both of which shall evidence one and the same
Agreement.
IN WITNESS WHEREOF, the parties have hereunto set their hands and caused
their seals to be affixed the day and year first above written
_______________________________ (SEAL)
C. B. ROGERS, JR.
EQUIFAX INC.
(CORPORATE SEAL) BY: _______________________________
President and Chief Executive
Officer
ATTEST:
______________________________
Corporate Vice President and
Secretary
<PAGE>
EXHIBIT 10.9
July 31, 1995
Mr. Derek V. Smith
Atlanta, Georgia
Dear Derek:
In connection with your proposed purchase of land on which you are to construct
a new residence, you have applied for and obtained financing from Boston Safe
Deposit and Trust Company ("Boston Trust") in the amount of $850,000. This
financing is conditioned, however, upon Equifax Services Inc. ("Equifax")
providing a Limited Corporate Guaranty to Boston Trust on your behalf in the
amount of $205,000 (the "Guaranty"). You have requested from Equifax the
issuance of said Guaranty and Equifax agrees to issue a Guaranty for your
behalf, subject to the following terms and conditions.
To evidence sums that may be required to be paid on your behalf, you agree to
the terms and conditions contained in that promissory note attached hereto as
Attachment "A" and agree to execute and deliver to Equifax the attached
promissory note simultaneously with your execution of this Letter Agreement. As
collateral for this note, you agree that: (a) upon the vesting of all Equifax
Inc. restricted stock currently held by you (or any that may be granted to you
in the future); and (b) upon payout in Equifax Inc. stock of all Performance
Share Plan units now held (or any that may be granted to you in the future),
Equifax may retain such stock as security as long as Equifax remains liable on
the Guaranty and/or sums have been advanced on your behalf under the Guaranty
which have not been repaid. Upon the vesting of restricted stock and/or PSP
payouts described above, you agree to execute and deliver to Equifax any and all
documents necessary for the granting of a valid security interest therein to
Equifax, along with duly executed blank stock powers.
Please acknowledge your agreement with the foregoing terms by signing in the
space provided below.
Sincerely,
Daniel W. McGlaughlin
President and Chief Operating Officer
DWM/kb
Attachment
DVSMITH.DWM
_____________________________________
Derek V. Smith
Date:________________________________
<PAGE>
PROMISSORY NOTE
$205,000
STATE OF GEORGIA
JULY 31, 1995
For value received, Derek V. Smith, of 305 Clifftop Court, Roswell, Georgia,
promises to pay to Equifax Services Inc., at 1600 Peachtree Street, NW, Atlanta,
Georgia 30309 ("Equifax"), the lesser of: (a) the principal sum of Two Hundred
Five Thousand Dollars ($205,000.00), plus interest; or (b) the aggregate, unpaid
principal amount of all advances, plus interest, made by Equifax pursuant to
that Limited Corporate Guaranty of even date issued to Boston Safe Deposit and
Trust Company ("Boston Trust"). Interest shall accrue at the annual rate of
8.0% from the date of any advance by Equifax to Boston Trust or its assigns
until paid in full. All sums due hereunder shall be due and payable upon
demand.
This Note is secured by Equifax Inc. common stock to be delivered in accordance
with the terms of that Letter Agreement, dated July 31, 1995, between the
undersigned and Equifax Services Inc., the terms of which are incorporated
herein by reference.
In the event any suit is commenced to enforce payment of this Note, the
undersigned agrees to pay such additional sum as attorney fees as the court in
such action may adjudge reasonable.
This Note shall be governed and construed in accordance with the laws of the
State of Georgia.
_____________________________________
Derek V. Smith
<PAGE>
EQUIFAX INC.
OMNIBUS STOCK INCENTIVE PLAN
----------------------------
ARTICLE I
DEFINITIONS
-----------
1.01. Agreement means a written agreement (including any amendment or
---------
supplement thereto) between the Company and a Participant specifying the terms
and conditions of an award of Restricted Stock or an Option or SAR granted to
such Participant.
1.02. Board means the Board of Directors of the Company.
-----
1.03. Code means the Internal Revenue Code of 1986, and any amendments
----
thereto.
1.04. Committee means a committee of the Board appointed to administer
---------
the Plan.
1.05. Common Stock means the common stock of the Company.
------------
1.06. Company means Equifax Inc.
-------
1.07. Corresponding SAR means an SAR that is granted in relation to a
-----------------
particular option and that can be exercised only upon the surrender to the
Company, unexercised, of that portion of the option to which the SAR relates.
1.08. Date of Exercise means (i) with respect to an option, the date that
----------------
the Option price is received by the Company and (ii) with respect to an SAR, the
date that the notice of exercise is received by the Company.
1.09. Fair Market Value means, on any given date, the closing price of a
-----------------
share of Common Stock as reported on the New York Stock Exchange composite tape
on such day or, if the Common Stock was not traded on the New York Stock
Exchange
(Includes amendments approved at 4/94 Shareholders'
Meeting, second amendment adopted July 1994
and amendmemt adopted June 1995)
<PAGE>
on such day, then on the next preceding day that the Common Stock was traded on
such exchange, all as reported by such source as the Committee may select.
1.10. Initial Value means, with respect to an SAR, the Fair Market Value
-------------
of one share of Common Stock on the date of grant, as set forth in the
Agreement.
1.11. Option means a stock option that entitles the holder to purchase
------
from the Company a stated number of shares of Common Stock at the price set
forth in an Agreement.
1.12. Participant means an officer or key employee of the Company or of a
-----------
Subsidiary, including an officer or key employee who is a member of the Board,
who satisfies the requirements of Article IV and is selected by the Committee to
receive a Restricted Stock award, an option, an SAR, or a combination thereof.
1.13. Plan means the Equifax Inc. Omnibus Stock Incentive Plan.
1.14. Restricted Stock means shares of Common Stock
----------
awarded to a Participant under Article IX. Shares of Common Stock shall cease
to be Restricted stock when, in accordance with the terms of the applicable
Agreement, they become transferable and free of substantial risks of forfeiture.
1.15. SAR means a stock appreciation right that entitles the holder to
---
receive, with respect to each share of Common Stock encompassed by the exercise
of such SAR, the amount determined by the Committee and specified in an
Agreement. In the absence of such a determination, the holder shall be entitled
to receive, with respect to each share of Common Stock encompassed by the
exercise of such SAR, the excess of the Fair Market Value on the Date of
Exercise over the Initial Value. References to "SARS" include both
Corresponding SARs and SARs granted independently of Options, unless the context
requires otherwise.
1.16. Subsidiary means any "subsidiary" (within the meaning of Section
----------
425
-2-
<PAGE>
of the Code) of the Company.
ARTICLE II
PURPOSES
--------
The Plan is intended to assist the Company in recruiting and retaining
officers and key employees with ability and initiative by enabling officers and
key employees to participate in its future success and to associate their
interests with those of tho Company and its shareholders. The Plan is intended
to permit the award of shares of Restricted Stock, the grant of SARS, and the
grant of both options qualifying under section 422A of the Code ("incentive
stock options") and options not so qualifying. No Option that is intended to be
an incentive stock option shall be invalid for failure to qualify as an
incentive stock option. The proceeds received by the Company from the sale of
Common Stock pursuant to this Plan shall be used for general corporate purposes.
ARTICLE III
ADMINISTRATION
--------------
Except as provided in this Article III, the Plan shall be administered
by the Committee. The Committee shall have authority to award Restricted Stock
and to grant Options and SARs upon such terms (not inconsistent with the
provisions of this Plan) as the Committee may consider appropriate. Such terms
may include conditions (in addition to those contained in this Plan) on the
exercisability of all or any part of an Option or SAR or on the transferability
or forfeitability of Restricted Stock. Notwithstanding any such conditions, the
Committee may, in its discretion, accelerate the time at which any Option or SAR
may be exercised or the time at which Restricted
-3-
<PAGE>
Stock may become transferable or nonforfeitable, but only in the event of the
death, retirement or disability of a Participant or a change in control of the
Company. For purposes hereof, "retirement" means retirement from the Company or
a Subsidiary on or after age 65, or, otherwise with the consent of the Company.
A "change in control of the Company" shall be deemed to exist in the event any
person, corporation, partnership or other entity, either alone or in conjunction
with its "affiliates" as that term is defined in Rule 405 of the General Rules
and Regulations under the Securities Act of 1933, as amended, or other group of
persons, corporations, partnerships or other entities who are not affiliates,
but who are acting in concert, are determined to own of record or beneficially
more than fifty percent (50%) of the shares of outstanding stock of the Company.
"Disability" means permanently and totally disabled as defined in Code
(S)22(e)(3). In addition, the Committee shall have complete authority to
interpret all provisions of this Plan; to prescribe the form of Agreements; to
adopt, amend, and rescind rules and regulations pertaining to the administration
of the Plan; and to make all other determinations necessary or advisable for the
administration of this Plan. The express grant in the Plan of any specific power
to the Committee shall not be construed as limiting any power or authority of
the Committee. Any decision made, or action taken, by the committee or in
connection with the administration of this Plan shall be final and conclusive.
No member of the Committee shall be liable for any act done in good faith with
respect to this Plan or any Agreement, Option, SAR or Restricted Stock award.
All expenses of administering this Plan shall be borne by the Company.
The Committee, in its discretion, may delegate to one or more officers
of the Company, all or part of the Committee's authority and duties with respect
to Participants who are not subject to the reporting and other provisions of
Section 16 of the Securities Exchange Act of 1934, as in effect from time to
time. In the event of such delegation,
-4-
<PAGE>
and as to matters encompassed by the delegation, references in the Plan to the
Committee shall be interpreted as a reference to the Committee's delegate or
delegates. The Committee may revoke or amend the terms of a delegation at any
time but such action shall not invalidate any prior actions of the Committee's
delegate or delegates that were consistent with the terms of the Plan.
ARTICLE IV
ELIGIBILITY
-----------
4.01. General. Any employee of the Company or of any Subsidiary
-------
(including any corporation that becomes a Subsidiary after the adoption of this
Plan) is eligible to participate in this Plan if the Committee, in its sole
discretion, determines that such person is an officer or key employee. Any such
officer or key employee may be awarded shares of Restricted Stock or may be
granted one or more Options, SARS, or options and SARS. Directors of the
Company who are employees of the Company or a Subsidiary and who are determined
to be officers or key employees are eligible to participate in this Plan. A
person who is a member of the Committee may not be awarded shares of Restricted
Stock and may not be granted options or SARs under this Plan.
4.02. Grants. The Committee will designate individuals to whom shares of
------
Restricted Stock are to be awarded and to whom Options and SARs are to be
granted and will specify the number of shares of Common Stock subject to each
award or grant. An option may be granted with or without a related SAR. An SAR
may be granted with or without a related Option. All shares of Restricted Stock
awarded, and all options and SARs granted, under this Plan shall be evidenced by
Agreements which shall be subject to applicable provisions of this Plan and to
such other provisions as the Committee may
-5-
<PAGE>
adopt. No Participant may be granted incentive stock options or related SARs
(under all incentive stock option plans of the Company and its Subsidiaries)
which are first exercisable in any calendar year for stock having an aggregate
Fair Market Value (determined as of the date an option is granted) exceeding
$100,000. The preceding annual limitation shall not apply with respect to
Options that are not incentive stock options. The aggregate number of options
and SARs granted to any Participant during any calendar year shall not exceed
150,000 Options and/or SARS. For purposes of the preceding sentence, Options
and any Corresponding SARs shall be treated as a single award.
ARTICLE V
STOCK SUBJECT TO OPTIONS
------------------------
Upon the award of shares of Restricted Stock the Company may issue
authorized but unissued Common Stock. Upon the exercise of any Option or SAR,
the Company may deliver to the Participant (or the Participant's broker if the
Participant so directs), authorized but unissued Common Stock. The maximum
aggregate number of shares of Common Stock that may be issued pursuant to the
exercise of Options and SARs and the award of Restricted Stock under this Plan
is 4,000,000, subject to adjustment as provided in Article X. If an Option or
SAR is terminated, in whole or in part, for any reason other than its exercise,
the number of shares of Common Stock allocated to the Option or SAR or portion
thereof may be reallocated to other Options, SARS, and Restricted Stock awards
to be granted under this Plan. Any shares of Restricted Stock that are forfeited
may be reallocated to other Options, SARs or Restricted Stock awards to be
granted under this Plan.
-6-
<PAGE>
ARTICLE VI
OPTION PRICE
------------
The price per share for Common Stock purchased on the exercise of an
option shall be determined by the Committee on the date of grant; provided,
however, that the price per share for Common Stock purchased on the exercise of
any Option shall not be less than the Fair Market Value on the date the Option
is granted.
ARTICLE VII
EXERCISE OF OPTION
------------------
7.01. Maximum Option or SAR Period. The maximum period in which an
----------------------------
Option or SAR may be exercised shall be determined by the Committee on the date
of grant except that no Option or SAR shall be exercisable after the expiration
of 10 years from the date the Option or SAR was granted. The terms of any option
or SAR may provide that it is exercisable for a period less than such maximum
period.
7.02. Nontransferability. Any Option or SAR granted under this Plan
------------------
shall be nontransferable except by will or by the laws of descent and
distribution. The preceding sentence to the contrary notwithstanding, if
permitted by the Agreement, an Option or SAR granted under this Plan may be
transferred to (1) members of the Participant's immediate family, (2) a trust
established for the benefit of members of the Participant's immediate family, or
(3) a partnership comprised only of immediate family members. "Immediate
family" shall include Participant's child(ren), spouse and grandchildren. In
the event of any such transfer, the Option and any Corresponding SAR that
relates to such Option must be transferred to the same person or person(s),
trust or partnership. No right or interest of a Participant in any Option or
SAR shall be liable for, or subject to, any lien, obligation, or liability of
such Participant or transferee. Any option or SAR
-7-
<PAGE>
transferred shall continue to be subject to the same terms and conditions that
were applicable to such Option or SAR prior to such transfer.
7.03. Employee Status. For purposes of determining the applicability of
---------------
Section 422A of the Code (relating to incentive stock options), or in the event
that the terms of any Option or SAR provide that it may be exercised only during
employment or within a specified period of time after termination of employment,
the Committee may decide to what extent leaves of absence for governmental or
military service, illness, temporary disability, or other reasons shall not be
deemed interruptions of continuous employment.
ARTICLE VIII
METHOD OF EXERCISE
------------------
8.01. Exercise. An Option or SAR granted under this Plan shall be deemed
to have been exercised on the Date of Exercise. Subject to the provisions of
Articles VII and XI, an option or SAR may be exercised in whole at any time or
in part from time to time at such times and in compliance with such requirements
as the Committee shall determine; provided, however, that a Corresponding SAR
that is related to an incentive stock option may be exercised only to the extent
that the related Option is exercisable and when the Fair Market Value exceeds
the option price of the related option. An Option or SAR granted under this Plan
may be exercised with respect to any number of whole shares less than the full
number for which the option or SAR could be exercised; provided, however, that
an option or SAR must be exercised for no less than twenty-five shares of Common
Stock or, if less, the number of shares of Common Stock that remain subject to
the Option or SAR. A partial exercise of an Option or SAR shall not affect the
right to exercise the Option or SAR from time to time in accordance with this
Plan and
-8-
<PAGE>
the applicable Agreement with respect to remaining shares subject to the Option
or related to the SAR. The exercise of either an Option or Corresponding SAR
shall result in the termination of the other to the extent of the number of
shares with respect to which the option or Corresponding SAR is exercised.
8.02. Payment. Unless otherwise provided by the Agreement, payment of
-------
the Option price shall be made in cash or a cash equivalent acceptable to the
Committee. If the Agreement provides, payment of all or part of the Option
price may be made by surrendering shares of Common Stock to the Company;
provided, however, that shares of Common Stock may be surrendered in payment of
all or part of the option price only if the surrendered shares have been held by
the Participant for at least six months prior to the Date of Exercise. If
Common Stock is used to pay all or part of the option price, the shares
surrendered must have a Fair Market Value (determined as of the day preceding
the Date of Exercise) that is not less than such price or part thereof.
8.03. Determination of Payment of Cash and/or Common Stock Upon Exercise
------------------------------------------------------------------
of SAR. At the Committee's discretion, the amount payable as a result of the
- ------
exercise of an SAR may be settled in cash, Common Stock, or a combination of
cash and Common Stock. No fractional shares shall be deliverable upon the
exercise of an SAR but a cash payment will be made in lieu thereof.
8.04. Shareholder Rights. No Participant shall have any rights as a
------------------
stockholder with respect to shares subject to his option or SAR until the Date
of Exercise of such Option or SAR.
ARTICLE IX
RESTRICTED STOCK
----------------
9.01. Award. In accordance with the provisions of Article IV,
-----
the Committee
-9-
<PAGE>
will designate each individual to whom an award of Restricted Stock is to be
made and will specify the number of shares of Common Stock covered by the award.
9.02. Vesting. The Committee, on the date of the award, shall prescribe
-------
that a Participant's rights in the Restricted Stock shall be non-transferable
and forfeitable for a period of time no less than three (3) years from the date
of grant. By way of example and not of limitation, shares shall vest no earlier
than three (3) years after date of grant and may provide that the shares will be
forfeited if the Participant separates from the service of the Company and its
Subsidiaries before the expiration of a stated term (not less than three years)
or if the Company, the Company and its Subsidiaries or the Participant fail to
achieve stated objectives.
9.03. Shareholder Rights. Prior to their forfeiture in accordance with
------------------
the terms of the Agreement and while the shares are Restricted Stock, a
Participant will have all rights of a shareholder with respect to Restricted
Stock, including the right to receive dividends and vote the shares; provided,
however, that (i) a Participant may not sell, transfer, pledge, exchange,
hypothecate, or otherwise dispose of Restricted Stock, (ii) the Company shall
retain custody of the certificates evidencing shares of Restricted Stock, and
(iii) the Participant will deliver to the Company a stock power, endorsed in
blank, with respect to each award of Restricted Stock. The limitations set
forth in the preceding sentence shall not apply after the shares cease to be
Restricted Stock.
ARTICLE X
ADJUSTMENT UPON CHANGE IN COMMON STOCK
--------------------------------------
The maximum number of shares as to which Restricted Stock may be awarded
and as to which options and SARs may be granted under this Plan shall be
proportionately adjusted, and the terms of outstanding Restricted Stock awards,
options,
-10-
<PAGE>
and SARs shall be adjusted, as the Committee shall determine to be equitably
required in the event that the Company (a) effects one or more stock dividends,
stock split-ups, subdivisions or consolidations of shares or (b) engages in a
transaction to which Section 425 of the Code applies. Any determination made
under this Article X by the Committee shall be final and conclusive.
The issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, for cash or property,
or for labor or services, either upon direct sale or upon the exercise of rights
or warrants to subscribe therefor, or upon conversion of shares or obligations
of the Company convertible into such shares or other securities, shall not
affect, and no adjustment by reason thereof shall be made with respect to,
outstanding awards of Restricted Stock, Options or SARS.
The Committee may award shares of Restricted Stock, may grant Options,
and may grant SARs in substitution for stock awards, stock options, stock
appreciation rights, or similar awards held by an individual who becomes an
employee of the Company or a Subsidiary in connection with a transaction
described in the first paragraph of this Article X. Notwithstanding any
provision of the Plan (other than the limitation of Article V) , the terms of
such substituted Restricted Stock awards and Option or SAR grants shall be as
the Committee, in its discretion, determines is appropriate.
ARTICLE XI
COMPLIANCE WITH LAW AND APPROVAL OF REGULATORY BODIES
-----------------------------------------------------
No Option or SAR shall be exercisable, no Common Stock shall be issued,
no certificates for shares of Common Stock shall be delivered, and no payment
shall be made under this Plan except in compliance with all applicable federal
and state laws and regulations (including, without limitation, withholding tax
requirements) and the rules of
-11-
<PAGE>
all domestic stock exchanges on which the Company's shares may be listed. The
Company shall have the right to rely on an opinion of its counsel as to such
compliance. Any share certificate issued to evidence Common Stock for which
shares of Restricted Stock are awarded or for which an option or SAR is
exercised may bear such legends and statements as the Committee may deem
advisable to assure compliance with federal and state laws and regulations. No
Option or SAR shall be exercisable, no Common Stock shall be issued, no
certificate for shares shall be delivered, and no payment shall be made under
this Plan until the Company has obtained such consent or approval as the
Committee may deem advisable from regulatory bodies having jurisdiction over
such matters.
ARTICLE XII
GENERAL PROVISIONS
------------------
12.01. Effect on Employment. Neither the adoption of
---------------------
this Plan, its operation, nor any documents describing or referring to this Plan
(or any part thereof) shall confer upon any employee any right to continue in
the employ of the Company or a Subsidiary or in any way affect any right and
power of the Company or a Subsidiary to terminate the employment of any employee
at any time with or without assigning a reason therefor.
12.02. Unfunded Plan. The Plan, insofar as it provides for grants,
-------------
shall be unfunded, and the Company shall not be required to segregate any assets
that may at any time be represented by grants under this Plan. Any liability of
the Company to any person with respect to any grant under this Plan shall be
based solely upon any contractual obligations that may be created pursuant to
this Plan. No such obligation of the Company shall be deemed to be secured by
any pledge of, or other encumbrance
-12-
<PAGE>
on, any property of the Company.
12.03. Rules of Construction. Headings are given to the articles and
---------------------
sections of this Plan solely as a convenience to facilitate reference. The
reference to any statute, regulation, or other provision of law shall be
construed to refer to any amendment to or successor of such provision of law.
ARTICLE XIII
AMENDMENT
---------
The Board may amend or terminate this Plan from time to time; provided,
however, that no amendment may become effective until shareholder approval is
obtained if (i) the amendment increases the aggregate number of shares of Common
Stock that may be issued under the Plan, (ii) the amendment changes the class of
individuals eligible to become Participants, or (iii) the amendment extends the
duration of the Plan. No amendment shall, without a Participant's consent,
adversely affect any rights of such Participant under any outstanding Restricted
Stock award or under any Option or SAR outstanding at the time such amendment is
made.
ARTICLE XIV
DURATION OF PLAN
----------------
No shares of Restricted Stock may be awarded and no Option or SAR may be
granted under this Plan after January 31, 2000. Restricted Stock awards and
Options and SARs granted before that date shall remain valid in accordance with
their terms.
ARTICLE XV
EFFECTIVE DATE OF PLAN
----------------------
Shares of Restricted Stock may be awarded and Options and SARs may be
granted under this Plan upon its adoption by the Board, provided that no
Restricted Stock award, Option or SAR will be effective unless this Plan is
approved by shareholders holding a majority of the Company's outstanding voting
stock, voting either in person or by proxy at a duly held shareholders' meeting
within twelve months of such adoption.
-13-
<PAGE>
EXHIBIT 21
----------
PARENTS AND SUBSIDIARIES
Registrant - Equifax Inc. (a Georgia corporation).
The Registrant owns 100% of the stock of the following subsidiaries as
of March 20, 1996 (all of which are included in the consolidated financial
statements):
<TABLE>
<CAPTION>
State or
Country of
Name of Subsidiary Incorporation
- ------------------ -------------
<S> <C>
1nfo Inc. Georgia
Acrofax Inc. Canada
BFIS Limited/(16)/ Ireland
Brentorian Limited/(14)/ U.K.
Business Geo-Metrics, Inc./(3)/ Georgia
Callcheck Chargecard Limited/(16)/ U.K.
CBI Ventures, Inc./(1)/ Georgia
Computacheck Limited/(16)/ U.K.
Computer Ventures, Inc./(1)/ Delaware
Credence, Inc. Georgia
Credit Northwest Corporation/(1)/ Washington
Dart Telemarketing Ltd./(14)/ U.K.
Datakey PVT Limited/(14)/ Zimbabwe
Decision-Net PTY Limited/(14)/ South Africa
EMDS Personnel Co., Inc./(3)/ Georgia
Equifax Card Services, Inc./(4)/ Florida
Equifax Check Services, Inc./(4)/ Delaware
Equifax Credit Information Services, Inc. Georgia
Equifax Decision Systems B.V. Netherlands
</TABLE>
1
<PAGE>
<TABLE>
<S> <C>
Equifax de Chile, S.A./(10)/ Chile
Equifax de Mexico, S.A./(11)(12)/ Mexico
Equifax Europe Ltd. Georgia
Equifax Europe (U.K.) Ltd./(9)/ United Kingdom
Equifax Government and Special Systems, Inc. Georgia
Equifax Healthcare EDI Services, Inc. Georgia
Equifax Healthcare Information Services, Inc. Georgia
Equifax Holdings (Mexico) Inc. Georgia
Equifax India, Inc. Georgia
Equifax Information Technology, Inc. Georgia
Equifax Investments (Mexico) Inc. Georgia
Equifax Investments (U.S.) Inc. Georgia
Equifax Marketing Decision Systems, Inc. Georgia
Equifax Payment Services, Inc./(5)/ Delaware
Equifax Properties, Inc. Georgia
Equifax Services Inc. Georgia
Equifax South America, Inc. Georgia
Equifax Ventures, Inc. Georgia
Financial Insurance Marketing Group, Inc./(4)/ District of
Columbia
First Bankcard Systems, Inc. Georgia
Freightcheck Information Services Limited/(16)/ U.K.
Globalscan Investment Limited/(17)/ U.K.
Globalscan Limited/(16)/ U.K.
Globalscan U.S.A./(18)/ U.S.A.
HealthChex, Inc. New York
</TABLE>
2
<PAGE>
<TABLE>
<S> <C>
Health Economics Corporation Texas
High Integrity Systems, Inc./(4)/ California
H.P. Information plc/(14)/ U.K.
H.P.I. Limited/(15)/ U.K.
Infocheck Computer Services Limited/(16)/ U.K.
Infocheck Credit Indemnity Limited/(16)/ U.K.
Infocheck Direct Limited/(16)/ Wales
Infocheck Financial Analysis Limited/(16)/ U.K.
Infocheck Insurance Services Limited/(16)/ U.K.
Infocheck On-line Limited/(16)/ U.K.
Infocheck On-line Scotland Limited/(16)/ Scotland
Infocheck Training Services Limited/(16)/ U.K.
Infocredit Limited/(16)/ Wales
Infolink Decision Services Limited/(14)/ U.K.
Infolink Limited/(14)/ U.K.
Intelligent Terminals Ltd./(14)/ U.K.
Knowledgelink Limited/(14)/ U.K.
Light Signatures, Inc./(4)/ California
Market Knowledge, Incorporated/(1)/ Illinois
Mid-American Technologies, Inc./(7)/ Kansas
Osborn Laboratories, Inc. Delaware
Osborn Laboratories (Canada) Inc./(7)/ Canada
Park Insurance Brokers Limited/(16)/ U.K.
PRC Corporation/(6)/ Georgia
Scorelink Limited/(14)/ U.K.
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
S.S.R. Limited/(15)/ U.K.
TecniCob/(13)/ France
The Database Company Limited/(16)/ Ireland
The Infocheck Group Limited /(8)/ U.K.
The Kit Factory/(7)/ Kansas
The Quantum Card Limited/(16)/ U.K.
T.I. Holding Corp. Delaware
UAPT-Infolink, plc/(8)/ United Kingdom
</TABLE>
In addition, Registrant's Canadian subsidiary Acrofax Inc. owns 84% of the stock
of Equifax Canada Inc. (a Canadian corporation). Equifax Canada Inc. owns 100%
of the stock of Telecredit Canada, Inc., Equifax Canada (AFX) Inc., Equifax
Accounts Receivable Services, Inc. and CBS Credit Bureau Services, Inc.
(Canadian corporations).
Reigstrant's subsidiary Equifax South America, Inc. owns 33% of Organizacion
Veraz, S.A., and, also, owns 100% of Equifax de Chile, S.A., which owns 50% of
Dicom, S.A.
Registrant's subsidiary Equifax Europe Ltd. owns 50% of Asnef and 100% of
Equifax Europe (U.K.) Ltd., which owns 49% of Scorex U.K. Ltd. and 50.1% of
Transax Ltd. which owns 100% of Transac Australia plc, Transax Financial
Services Limited, Transax France plc, Transax Ireland plc, Transax Pty Limited,
Transax S.N.C., Retail Credit Management Limited, School House U.K. Limited, and
Vivat plc.
/(1)/Subsidiary of Equifax Credit Information Services, Inc.
/(2)/Subsidiary of Equifax Healthcare Information Services, Inc.
/(3)/Subsidiary of Equifax Marketing Decision Systems, Inc.
/(4)/Subsidiary of Equifax Payment Services, Inc.
/(5)/Subsidiary of T.I. Holding Corp.
/(6)/Subsidiary of Equifax Services Inc.
/(7)/Subsidiary of Osborn Laboratories, Inc.
/(8)/Subsidiary of Equifax Europe (U.K.) Ltd.
/(9)/Subsidiary of Equifax Europe Ltd.
/(10)/Subsidiary of Equifax South America, Inc.
4
<PAGE>
/(11)/Subsidiary of Equifax Holdings (Mexico) Inc.
/(12)/Subsidiary of Equifax Investments (Mexico) Inc.
/(13)/Subsidiary of First Bankcard Systems, Inc.
/(14)/Subsidiary of UAPT-Infolink plc
/(15)/Subsidiary of H.P. Info plc
/(16)/Subsidiary of The Infocheck Group Limited
/(17)/Subsidiary of Globalscan Limited
/(18)/Subsidiary of Globalscan Investments Limited
5
<PAGE>
EXHIBIT 23
----------
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
- -----------------------------------------
As independent public accountants, we hereby consent to the incorporation of
our report included in this Form 10-K into the Company's previously filed
Registration Statements on Form S-3 or Form S- 8, File No. 33-40011, File No.
33-58734, File No. 33-34640, File No. 33-71202, as amended, File No. 33-66728,
File No. 33-71200, File No. 33-82374, File No. 33-86018, File No. 33-86978, File
No. 33- 58627 and File No. 33-63001.
Atlanta, Georgia
March 26, 1996
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM (IDENTIFY
SPECFIC FINANCIAL STATEMENTS) AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<EXCHANGE-RATE> 1
<CASH> 26,136
<SECURITIES> 0
<RECEIVABLES> 265,412
<ALLOWANCES> 7,077
<INVENTORY> 0
<CURRENT-ASSETS> 366,676
<PP&E> 236,749
<DEPRECIATION> 148,901
<TOTAL-ASSETS> 1,053,695
<CURRENT-LIABILITIES> 250,620
<BONDS> 302,665
0
0
<COMMON> 211,015
<OTHER-SE> 441,006
<TOTAL-LIABILITY-AND-EQUITY> 1,053,695
<SALES> 1,622,958
<TOTAL-REVENUES> 1,622,958
<CGS> 1,033,881
<TOTAL-COSTS> 1,033,881
<OTHER-EXPENSES> 321,138
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 21,172
<INCOME-PRETAX> 249,238
<INCOME-TAX> 101,588
<INCOME-CONTINUING> 147,650
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 147,650
<EPS-PRIMARY> .98
<EPS-DILUTED> .98
</TABLE>
