<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
(Mark One)
[xx] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1995
[ ] 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 1-5846
------
THE LIBERTY CORPORATION
-----------------------
(Exact name of registrant as specified in its charter)
South Carolina 57-0507055
(State or other jurisdiction of (IRS Employer
incorporation or organization) identification No.)
Post Office Box 789, Wade Hampton Boulevard, Greenville, SC 29602
------------------------------------------------------------------
(Address of principal executive offices)
Registrant's telephone number, including area code: 803/268-8436
------------
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 the number of shares outstanding of each of the Registrant's classes
of common stock as of the latest practicable date.
<TABLE>
<CAPTION>
Number of shares Outstanding
Title of each class as of June 30, 1995
------------------- ----------------------------
<S> <C>
Common Stock 19,981,581
</TABLE>
Page 1 of 12 sequentially numbered pages.
The Exhibit Index is on Page 10.
<PAGE> 2
PART I, ITEM 1
THE LIBERTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, 1995 December 31, 1994
(In 000's) ------------- -----------------
ASSETS (Unaudited)
<S> <C> <C>
Investments:
Fixed Maturity Securities
Available for Sale, at market, cost of $1,017,386 at 6/30/95 and
$947,522 at 12/31/94 $ 1,044,850 $ 883,029
Held to Maturity, at cost, market of $320,169 at 6/30/95 and $311,129
at 12/31/94 292,512 299,118
Equity Securities, primarily at market, cost of $74,101 at 6/30/95 and
$78,116 at 12/31/94 79,861 78,208
Mortgage Loans 195,032 203,381
Investment Real Estate 143,698 135,545
Loans to Policyholders 97,556 96,160
Other Long-Term Investments 29,715 31,624
Short-term Investments 2,418 7,264
----------- -----------
Total Investments 1,885,642 1,734,329
Cash 50,265 51,400
Accrued Investment Income 19,169 18,708
Receivables 42,638 37,879
Receivable from Reinsurers 258,243 258,969
Deferred Acquisition Costs 360,233 358,535
Buildings and Equipment 78,738 66,360
Intangibles Related to Television Operations 76,651 46,934
Goodwill Related to Insurance Acquisitions 39,475 40,308
Other Assets 56,585 54,522
----------- -----------
Total Assets $ 2,867,639 $ 2,667,944
=========== ===========
LIABILITIES, REDEEMABLE PREFERRED STOCK AND SHAREHOLDERS' EQUITY
Liabilities
Policy Liabilities $ 1,829,500 $ 1,784,303
Notes, Mortgages and Other Debt 150,585 131,647
Long Term Debt 100,000 100,000
Accrued Income Taxes 3,529 4,418
Deferred Income Taxes 131,340 112,707
Accounts Payable and Accrued Expenses 66,522 66,608
Other Liabilities 29,272 26,856
----------- -----------
Total Liabilities 2,310,748 2,226,539
=========== ===========
Redeemable Preferred Stock
1994-A Series, $35.00 redemption value, shares issued and outstanding -
668,207 in 1995 and 1994 23,387 23,387
1994-B Series, $37.50 redemption value, shares issued and outstanding -
596,485 in 1995 and 598,101 in 1994 22,368 22,429
Shareholders' Equity
Common Stock 156,493 152,956
Series 1995-A Convertible Preferred Stock, $35.00 redemption value,
599,985 shares issued and outstanding 21,000 ---
Unearned Stock Compensation (6,678) (5,319)
Unrealized Investment Gains (Losses) 21,010 (53,109)
Cumulative Foreign Currency Translation Adjustment (1,020) (1,491)
Retained Earnings 320,331 302,552
----------- -----------
Total Shareholders' Equity 511,136 395,589
----------- -----------
Total Liabilities, Redeemable Preferred Stock and Shareholders'
Equity $ 2,867,639 $ 2,667,944
=========== ===========
</TABLE>
See Notes to Consolidated and Condensed Financial Statements.
2
<PAGE> 3
THE LIBERTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND CONDENSED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Three Months ended Six Months ended
June 30, June 30,
------------------ ----------------
(In 000's, except per share data) 1995 1994 1995 1994
---- ---- ---- ----
(Unaudited)
<S> <C> <C> <C> <C>
REVENUES
Insurance Premiums & Policy Charges $ 85,648 $ 81,218 $ 168,754 $ 148,013
Broadcasting Revenues 32,134 25,681 56,887 46,928
Net Investment Income 35,932 34,177 71,172 62,678
Service Contract Revenue 2,232 1,441 4,492 2,961
Realized Investment Gains (Losses) (820) 607 (2,694) 2,165
------------ ------------ ------------ -------------
Total Revenues 155,126 143,124 298,611 262,745
------------ ------------ ------------ -------------
EXPENSES
Policyholder Benefits 62,109 58,246 124,757 105,988
Commissions 13,036 12,511 25,657 23,668
General Insurance Expenses 17,586 15,811 34,005 29,189
Amortization of Deferred Acquisition Costs 9,970 10,889 20,647 21,247
Broadcasting Expenses 22,119 17,502 40,156 33,681
Interest Expense 3,705 2,867 7,203 4,560
Other Expenses 3,755 2,955 7,260 5,934
------------ ------------ ------------ -------------
Total Expenses 132,280 120,781 259,685 224,267
------------ ------------ ------------ -------------
Income Before Income Taxes 22,846 22,343 38,926 38,478
Provision for Income Taxes 7,441 7,743 12,983 13,305
------------ ------------ ------------ -------------
NET INCOME $ 15,405 $ 14,600 $ 25,943 $ 25,173
------------ ------------ ------------ -------------
EARNINGS PER SHARE: (Exhibit 11) $ .72 $ .70 $ 1.21 $ 1.24
Dividends Per Common Share $ .17 $ .155 $ .325 $ .31
</TABLE>
See Notes to Consolidated and Condensed Financial Statements.
3
<PAGE> 4
THE LIBERTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Six Months Ended June 30
-----------------------------------
(In 000's) 1995 1994
-----------------------------------
(Unaudited)
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $ 25,943 $ 25,173
Adjustments to reconcile net income to net cash provided (used)
in operating activities:
Increase in policy liabilities 22,696 24,296
Increase (decrease) in accounts payable and accrued liabilities (2,583) 996
(Increase) decrease in receivables (73) (468)
Amortization of policy acquisition costs 20,646 21,247
Policy acquisition costs deferred (28,473) (30,607)
Realized investment (gains) losses 2,694 (2,165)
Gain on sale of operating assets (1,522) (1,214)
Depreciation and amortization 9,215 6,815
Amortization of bond premium and discount (3,273) (2,308)
Provision for deferred income taxes 1,546 4,179
All other operating activities, net (3,070) (13,025)
------------- -------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 43,746 32,919
INVESTMENT ACTIVITIES
Investment securities sold - available for sale 85,968 108,224
Investment securities matured or redeemed by issuer:
Available for sale 14,749 36,359
Held to maturity 13,159 45,158
Cost of investment securities acquired - available for sale (169,590) (218,384)
Mortgage loans made (4,599) (15,395)
Mortgage loan repayments 12,745 11,979
Purchase of investment real estate, buildings and equipment (26,841) (66,987)
Sale of investment real estate, buildings and equipment 11,597 10,585
Purchase of short-term investments (29,445) (366,730)
Sales of short-term investments 34,342 371,662
Net cash paid on purchase of television station (8,099) ---
Net cash paid on purchases of insurance companies --- (53,686)
All other investment activities, net (1,140) 1,627
------------- -------------
NET CASH USED IN INVESTING ACTIVITIES (67,154) (135,588)
FINANCING ACTIVITIES
Proceeds from borrowings 1,349,000 1,140,218
Principal payments on debt (1,340,794) 1,016,298)
Dividends paid (8,145) (6,878)
Stock issued for employee benefit and compensation programs 1,287 2,141
Retirement of common stock (1) ---
Return of policyholders' account balances (18,343) (14,112)
Receipts credited to policyholders' account balances 39,269 35,802
------------- -------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 22,273 140,873
INCREASE (DECREASE) IN CASH (1,135) 38,204
Cash at beginning of year 51,400 29,487
------------- -------------
CASH AT END OF PERIOD $ 50,265 $ 67,691
============= =============
</TABLE>
See Notes to Consolidated and Condensed Financial Statements.
4
<PAGE> 5
THE LIBERTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS
June 30, 1995
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated and condensed financial
statements of The Liberty Corporation and Subsidiaries have been
prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form
10-Q and Article 10 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. The
information included is not necessarily indicative of the annual
results that may be expected for the year ended December 31, 1995, but
it does reflect all adjustments (which are of a normal and recurring
nature) considered, in the opinion of management, necessary for a fair
presentation of the results for the interim periods presented. For
further information, refer to the consolidated financial statements and
footnotes thereto included in The Liberty Corporation annual report on
Form 10-K for the year ended December 31, 1994.
2. ACQUISITIONS
On February 28, 1995, the Company completed the acquisition of
WLOX-TV in Biloxi, Mississippi. The purchase price of $41 million was
funded with a combination of cash, convertible preferred stock, and
notes payable. The Company issued 599,985 shares of Series
1995-A Voting Cumulative Convertible Preferred Stock having a total
redemption value of $20,999,475 or $35.00 per share in connection with
the acquisition. For additional information, see the Company's
quarterly report on Form 10Q for the period ended March 31, 1995.
3. COMMITMENTS AND CONTINGENCIES
At June 30, 1995, the Company had made commitments as shown below:
(In 000's)
<TABLE>
<S> <C>
Buildings and equipment $ 1,872
Investment real estate 10,953
Mortgage loans and bonds 12,095
Other 8,577
-------
$33,497
=======
</TABLE>
4. SUPPLEMENTAL INFORMATION ON INSURANCE OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
--------------------------- -------------------------
(In Millions) 1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Increase in net insurance in force 39 153 205 924
====== ====== ====== ======
Net insurance in force 17,030 16,205 17,069 16,358
====== ====== ====== ======
</TABLE>
5
<PAGE> 6
The Liberty Corporation and Subsidiaries
Management's Discussion and Analysis of Operations June 30, 1995
PART I, ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
(Unaudited)
OPERATIONS
Consolidated second quarter net income of $15.4 million increased 6% over
1994's second quarter (see table below). Although operating earnings (which
exclude net realized gains and losses) increased $1.9 million (13%) over 1994's
second quarter, net income reflects realized investment losses (after-tax) of
$.7 million in second quarter 1995 versus realized investment gains of $.4
million in second quarter 1994, a swing of $1.1 million.
Year to date net income of $25.9 million increased 3% over the comparable 1994
period. An operating earnings increase of $4.0 million (17%) was offset by
realized investment losses totaling $1.9 million in the current year versus
realized investment gains of $1.3 million in 1994.
<TABLE>
<CAPTION>
Second Quarter Year-to-Date
--------------- ------------
1995 1994 1995 1994
----------------------- ----------------------
<S> <C> <C> <C> <C>
Income Before Income Taxes $22,846 $22,343 $38,926 $38,478
Income Taxes 7,441 7,743 12,983 13,305
------- ------- ------- -------
Net Income $15,405 $14,600 $25,943 $25,173
======= ======= ======= =======
</TABLE>
Excluding realized gains and losses, over the comparable prior year quarter the
Company's insurance operations saw an increase in pre-tax income of $2.7
million, broadcasting had an increase of $1.9 million, and the Parent Company
had an increased loss of $2.2 million.
The $2.7 million pre-tax earnings increase for insurance operations was
primarily driven by Liberty Life, which saw an improvement of $2.1 million
versus the comparable prior year period. Compared to the second quarter of
1994, Liberty Life experienced an improvement in claims (primarily in the
mortgage protection line of business), lapse experience and lower general
expenses. The decision in 1994 to exit the general agency marketing division
resulted in a $.8 million improvement in earnings compared to the second
quarter 1994. The pre-need business contributed a pretax earnings increase of
$.6 million.
The $1.9 million (30%) increase in pretax earnings from broadcasting operations
was due to a significant increase in national and local revenues coupled with
higher network compensation. Additionally, the acquisition of WLOX-TV
contributed to the quarterly improvement compared to the second quarter of
1994.
The $2.2 million increase in the parent company's before-tax loss was a result
of higher interest expense due to the impact of rising interest rates on the
Company's borrowings and due to lower real estate land and lot sales.
Consolidated revenues increased $12.0 million (8%) from the prior year second
quarter due to a $6.1 million (5%) increase in revenues from the insurance
operations driven by higher premiums and investment income, and a $6.4 million
increase in broadcasting revenues. These improvements were offset by a
decrease in the parent company due to lower real estate land and lot sales
compared to the prior year. Excluding the impact of realized investment gains
and losses, consolidated revenues increased $13.4 million (9%).
6
<PAGE> 7
The Liberty Corporation and Subsidiaries
Management's Discussion and Analysis of Operations June 30, 1995
Insurance premiums increased $4.4 million (5%) in the second quarter due to
additional premiums of $2.1 million from the pre-need group and $2.3 million
from Liberty Life. The $20.7 million (14%) increase in year-to-date premiums
is partially due to the inclusion of the three 1994 acquisitions for a full six
months during 1995.
Broadcasting revenues for the quarter, up $6.4 million (25%), benefited
primarily from an increase in national revenues, a $4.1 million increase in
local revenues, as well as increased network compensation. Revenues related to
Cosmos' cable operations, which began last year, were up $.7 million. WLOX-TV
contributed $3.7 million of the increase in revenues, with the seven existing
stations all showing revenue increases as well. The year-to-date increase in
broadcasting revenues is driven by the same factors affecting the quarterly
comparisons.
The $3.9 million (7%) increase in policy benefits was due to a $3.1 million
increase in the pre-need companies and a $.8 million increase in Liberty Life.
The year-to-date increase is a result of inclusion of the three 1994
acquisitions for a full six months during 1995.
The 8% decrease in amortization of deferred acquisition costs for the quarter
was due to continued improvement in lapse experience in both home service and
mortgage protection.
Broadcasting expenses were up 26% for the quarter due to the additional
expenses associated with its cable operations as well as a full quarter of
expenses related to the WLOX operation.
INVESTMENTS
As of June 30, 1995, approximately 69% of the Company's $1.9 billion
consolidated invested assets were in bonds with an overall average credit
rating of AA. Less than 5% of the bond portfolio was rated below investment
grade.
Approximately 58% of the Company's $1.3 billion bond portfolio at June 30,
1995, was comprised of mortgage-backed securities compared to 54% at December
31, 1994. Certain mortgage-backed securities are subject to significant
prepayment or extension risk due to changes in interest rates. In periods of
declining interest rates, mortgages may be repaid more rapidly than scheduled
as borrowers refinance higher rate mortgages to take advantage of the lower
current rates. As a result, holders of mortgage-backed securities may receive
large prepayments on their investments which cannot be reinvested at interest
rates comparable to the rates on the prepaid mortgages. In a rising interest
rate environment refinancings are significantly curtailed and the payments to
the holders of the securities decline, limiting the ability of the holder to
reinvest at the higher interest rates. Mortgage-backed pass-through securities
and sequential collateralized mortgage obligations ("CMO's"), which comprised
18% of the book value of the Company's mortgage-backed securities at June 30,
1995, and 17% at December 31, 1994, are sensitive to prepayment or extension
risk.
The remaining 82% of the Company's mortgage-backed investment portfolio at June
30, 1995, consisted of planned amortization class ("PAC") instruments compared
to approximately 83% at December 31, 1994. These investments are designed to
amortize in a more predictable manner by shifting the primary prepayment and
extension risk of the underlying collateral to investors in other tranches of
the CMO.
Mortgage loans of $195.0 million comprised 10% of the consolidated investment
portfolio at June 30, 1995. Substantially all of these mortgage loans are
commercial mortgages with a loan to value ratio not exceeding 75% when made.
These loans are concentrated in the southeast primarily in the states of North
Carolina, South Carolina, Georgia, Florida, Virginia, and Tennessee.
Investment real estate at June 30, 1995, of $143.7 million comprised 8% of the
consolidated investment portfolio compared to 8% at December 31, 1994. Four
key property types made up approximately 90% of the Company's real estate
investment assets: residential land development, business parks, business
property rentals and shopping centers.
7
<PAGE> 8
The Liberty Corporation and Subsidiaries
Management's Discussion and Analysis of Operations June 30, 1995
The majority of the Company's investment real estate is located in South
Carolina, Florida, Georgia, and North Carolina.
FINANCIAL POSITION
As a result of the first quarter acquisition of WLOX-TV, the Company's
consolidated assets increased approximately $41.0 million. Based on a
preliminary appraisal of the assets acquired, approximately $11.8 million has
been classified as buildings and equipment with the remainder classified as
intangibles related to television operations. Additionally, the Company's
notes, mortgages and other debt increased by approximately $20.0 million, and
convertible preferred stock was issued totaling $21.0 million.
The Company adopted SFAS No. 115, "Accounting for Certain Investments in Debt
and Equity Securities" on January 1, 1994. As of June 30, 1995, the Company
reported an unrealized gain of $21.0 million on fixed maturity securities
available for sale and equity securities. This compares with an unrealized
loss of $53.1 million at December 31, 1994. Fixed maturities held to maturity
had an unrealized gain of $27.7 million which is not reported in the balance
sheet, since these securities continue to be carried at cost under SFAS No.
115.
CAPITAL, FINANCING AND LIQUIDITY
The Company's net cash flow from operating activities was $43.7 million for the
first six months of 1995 compared to $32.9 million for the same period of 1994.
The Company's net cash used in investing activities was $67.2 million, and cash
flow provided from financing activities was $22.3 million. As a result of its
activities, the Company had a $1.1 million decrease in cash compared to an
increase of $38.2 million in the same period in 1994. The net cash used in
investing activities was primarily related to net cash paid on the purchase of
WLOX-TV and the purchase of various investment real estate properties. The net
cash provided from financing activities was primarily from proceeds from
borrowings net of principal payments on debt. The proceeds from borrowings
were used to partially finance the acquisition of WLOX.
At June 30, 1995, the Company's borrowings and notes payable amounted to $250.6
million, an increase from the $231.6 million outstanding at December 31, 1994.
The increase was primarily a function of borrowings and notes payable related
to the WLOX acquisition. The total purchase price of $41.0 million was funded
by borrowing approximately $5.7 million against the credit facility, issuing
notes payable totaling $13.5 million, and issuing a new class of convertible
preferred stock totaling $21.0 million. The preferred stock has a stated value
of $35.00 per share and will pay an annual dividend of 5%. The preferred stock
is convertible at any time by the holder into one share of the Company's common
stock. Additionally, the Company may redeem the preferred stock at any time
beginning five years and one month after the date of issuance for cash, common
stock of the Company, or a combination of them both. The 1995-A Series
Cumulative Convertible Preferred Stock was only issued to WLOX shareholders in
connection with the acquisition of the company and no additional shares of this
Series were made available to the public.
The Company uses various interest rate swaps and caps to help minimize the
impact of a potential significant rise in short term interest rates. (See the
Company's 1994 Annual Report to Shareholders for a description of the interest
rate caps in place.) The Company has also entered into an interest rate swap
agreement which effectively fixes the rate on the $100 million term loan
facility at 5.965% plus a credit spread (currently .625%) based on the ratio
of consolidated debt to consolidated cash flow, as defined, and will expire in
March 2002. The swap agreement is with a major financial institution which is
expected to fully perform under the term of the agreement thereby mitigating
the credit risk from the transaction. The agreement is a contract to exchange
fixed and floating interest rate payments periodically over the life of the
agreement without the exchange of the underlying notional amounts. The Company
has not used interest rate swaps or any other derivative financial instruments
to manage its interest rate exposure on interest sensitive universal-life type
products.
8
<PAGE> 9
The Liberty Corporation and Subsidiaries
Management's Discussion and Analysis of Operations June 30, 1995
Other Company commitments are shown in Note 3 contained in the accompanying
financial statements. Additional detail as to commitments and financing is
contained in the Notes to the Consolidated Financial Statements in the
Company's annual report on Form 10K for the year ended December 31, 1994.
Further discussion of investments and valuation is contained in Notes 1 and 2
to the Consolidated Financial Statements in the Company's annual report on Form
10K for the year ended December 31, 1994.
ACCOUNTING DEVELOPMENTS
The Company adopted Statement of Financial Accounting Standard No. 114,
"Accounting by Creditors for Impairments of a Loan" ("SFAS No. 114"), on
January 1, 1995. For additional information, see the Company's quarterly
report on Form 10Q for the period ended March 31, 1995.
9
<PAGE> 10
PART II, ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) The annual meeting of shareholders of the registrant was held on May 2,
1995.
(b) The following four individuals were elected as directors to serve for
three-year terms: Edward E. Crutchfield, Jr., John R. Farmer, William O.
McCoy, and John H. Mullin, III. Listed below are directors who continued
their term of office after the meeting: Rufus C. Barkley, W. W. Johnson,
William S. Lee, Benjamin F. Payton, Lawrence M. Gressette, Jr., Francis
M. Hipp, W. Hayne Hipp, Buck Mickel, and J. Thurston Roach.
(c) Matters voted upon at the annual meeting are as follows:
<TABLE>
<CAPTION>
Withheld/ Broker
For Against Abstentions Nonvotes
--- ------- ----------- --------
<S> <C> <C> <C> <C>
To elect as directors:
Edward E. Crutchfield, Jr. 18,409,579 --- 90,625 ---
John R. Farmer 18,447,236 --- 53,268 ---
William O. McCoy 18,447,236 --- 53,268 ---
John H. Mullin, III 18,447,236 --- 53,268 ---
To elect as independent auditors:
Ernst & Young 18,481,551 8,017 10,936 ---
</TABLE>
(d) There were no settlements between the registrant and any other
participants.
PART II, ITEM 6. EXHIBIT AND REPORTS ON FORM 8-K
(a) A list of the exhibits filed with this report is included in
the Index to Exhibits filed herewith.
(b) The filing of Form 8-K was not required during the second
quarter of 1995.
INDEX TO EXHIBITS
EXHIBIT 10 Credit Agreement Dated March 21, 1995
EXHIBIT 11 Consolidated Earnings Per Share Computation
EXHIBIT 27 Financial Data Schedule (Electronic Filing Only)
10
<PAGE> 11
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.
THE LIBERTY CORPORATION Date: August 10, 1995
-----------------------
(Registrant)
/s/ H. Ray Eanes
-----------------
H. Ray Eanes
Senior Vice President Finance & Treasurer
/s/ John P. Smith
------------------
John P. Smith
Corporate Controller
11
<PAGE> 1
EXHIBIT 10
CREDIT AGREEMENT
DATED MARCH 21, 1995
<PAGE> 2
$375,000,000
CREDIT AGREEMENT
DATED AS OF
MARCH 21, 1995
AMONG
THE LIBERTY CORPORATION
THE BANKS LISTED HEREIN
AND
WACHOVIA BANK OF GEORGIA, N.A.,
AS AGENT
<PAGE> 3
TABLE OF CONTENTS
CREDIT AGREEMENT
<TABLE>
<S> <C> <C>
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
-----------
SECTION 1.02. Accounting Terms and Determinations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
-----------------------------------
SECTION 1.03. References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
----------
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
-------------------
SECTION 2.02. Method of Borrowing Term Loans and Syndicated Loans . . . . . . . . . . . . . . . . . . . . . . . . . 20
---------------------------------------------------
SECTION 2.03. Money Market Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
------------------
SECTION 2.04. Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
-----
SECTION 2.05. Maturity of Revolving Credit Advances, Term Loans and Convertible Loans . . . . . . . . . . . . . . . 27
-----------------------------------------------------------------------
SECTION 2.06. Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
--------------
SECTION 2.07. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
----
SECTION 2.08. Optional Termination or Reduction of Revolving Credit Commitments, Convertible Loan Commitments
-----------------------------------------------------------------------------------------------
and Term Loan Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
-------------------------
SECTION 2.09. Mandatory Reduction and Termination of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . 35
--------------------------------------------------
SECTION 2.10. Optional Prepayments of Revolving Credit Advances, Term Loans and Convertible Loans . . . . . . . . . 36
-----------------------------------------------------------------------------------
SECTION 2.11. Mandatory Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
---------------------
SECTION 2.12. General Provisions as to Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
---------------------------------
</TABLE>
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<TABLE>
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SECTION 2.13. Computation of Interest and Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
--------------------------------
SECTION 2.14 Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
----------
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to First Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
-----------------------------
SECTION 3.02. Conditions to All Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
----------------------------
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
-----------------------------
SECTION 4.02. Corporate and Governmental Authorization; No Contravention . . . . . . . . . . . . . . . . . . . . . . 42
----------------------------------------------------------
SECTION 4.03. Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
--------------
SECTION 4.04. Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
---------------------
SECTION 4.05. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
----------
SECTION 4.06. Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
---------------------
SECTION 4.07. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
-----
SECTION 4.08. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
------------
SECTION 4.09. Not an Investment Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
-------------------------
SECTION 4.10. Ownership of Property; Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
----------------------------
SECTION 4.11. No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
----------
SECTION 4.12. Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
---------------
SECTION 4.13. Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
----------------------
SECTION 4.14. Insolvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
----------
SECTION 4.15 Public Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
----------------------------------
</TABLE>
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<TABLE>
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ARTICLE V
COVENANTS
SECTION 5.01. Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
-----------
SECTION 5.02. Inspection of Property, Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
-----------------------------------------
SECTION 5.03. Ratio of Consolidated Debt to Consolidated Total Capital . . . . . . . . . . . . . . . . . . . . . . . 47
--------------------------------------------------------
SECTION 5.04. Minimum Stockholders' Equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
----------------------------
SECTION 5.05. Stock Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
--------------
SECTION 5.06. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
-------------------
SECTION 5.07. Fixed Charges Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
----------------------
SECTION 5.08. Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
--------------------
SECTION 5.09. Loans or Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
-----------------
SECTION 5.10. Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
-----------
SECTION 5.11. Negative Pledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
---------------
SECTION 5.12. Maximum Consolidated Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
-------------------------
SECTION 5.13. Ratio of Consolidated Debt to Cash Flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
---------------------------------------
SECTION 5.14. Conduct of Business and Maintenance of Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
------------------------------------------------
SECTION 5.15. Dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
-----------
SECTION 5.16. Consolidations, Mergers and Sales of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
-------------------------------------------
SECTION 5.17. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
---------------
SECTION 5.18. Compliance with Laws; Payment of Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
--------------------------------------
SECTION 5.19. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
---------
SECTION 5.20. Change in Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
---------------------
SECTION 5.21. Maintenance of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
-----------------------
</TABLE>
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<TABLE>
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SECTION 5.22. Environmental Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
---------------------
SECTION 5.23. Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
---------------------
SECTION 5.24. Environmental Release . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
---------------------
SECTION 5.25. Aggregate Values of Investment Properties and Total Investments . . . . . . . . . . . . . . . . . . . 52
---------------------------------------------------------------
SECTION 5.26. Surplus Relief Reinsurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
--------------------------
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
-----------------
SECTION 6.02. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
-----------------
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment, Powers and Immunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
----------------------------------
SECTION 7.02. Reliance by Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
-----------------
SECTION 7.03. Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
--------
SECTION 7.04. Rights of Agent and its Affiliates as a Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
--------------------------------------------
SECTION 7.05. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
---------------
SECTION 7.06. CONSEQUENTIAL DAMAGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
---------------------
SECTION 7.07. Payee of Note Treated as Owner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
------------------------------
SECTION 7.08. Non-Reliance on Agent and Other Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
-------------------------------------
SECTION 7.09. Failure to Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
--------------
SECTION 7.10. Resignation or Removal of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
-------------------------------
</TABLE>
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ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair . . . . . . . . . . . . . . . . . . . . . . . 59
--------------------------------------------------------
SECTION 8.02. Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
----------
SECTION 8.03. Increased Cost and Reduced Return . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
---------------------------------
SECTION 8.04. Base Rate Loans Substituted for Affected Euro-Dollar Loans . . . . . . . . . . . . . . . . . . . . . . 61
----------------------------------------------------------
SECTION 8.05. Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
------------
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
-------
SECTION 9.02. No Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
----------
SECTION 9.03. Expenses; Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
-------------------------
SECTION 9.04. Sharing of Set-Offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
-------------------
SECTION 9.05. Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
----------------------
SECTION 9.06. Margin Stock Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
-----------------------
SECTION 9.07. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
----------------------
SECTION 9.08. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
---------------
SECTION 9.09. Representation by Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
-----------------------
SECTION 9.10. Obligations Several . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
-------------------
SECTION 9.11. Survival of Certain Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
-------------------------------
SECTION 9.12. Georgia Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
-----------
SECTION 9.13. Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
-----------------------
</TABLE>
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SECTION 9.14. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
------------
SECTION 9.15. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
-------------
SECTION 9.16. Termination of Prior Credit Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
-------------------------------------
</TABLE>
SCHEDULE 2.06
SCHEDULE 5.01(c)
EXHIBIT A-1 Form of Syndicated Revolving Credit Note
EXHIBIT A-2 Form of Money Market Revolving Credit Note
EXHIBIT A-3 Form of Term Note
EXHIBIT A-4 Form of Syndicated Convertible Loan Note
EXHIBIT A-5 Form of Money Market Convertible Loan Note
EXHIBIT B Form of Opinion of Counsel for the Borrower
EXHIBIT C Form of Opinion of Counsel for the Agent
EXHIBIT D Form of Closing Certificate
EXHIBIT E Form of Secretary's Certificate of the Borrower
EXHIBIT F Form of Assignment and Acceptance
EXHIBIT G Form of Notice of Borrowing
EXHIBIT H Form of Money Market Quote Request
EXHIBIT I Form of Money Market Quote
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<PAGE> 9
CREDIT AGREEMENT
AGREEMENT dated as of March 21, 1995, among THE LIBERTY
CORPORATION, the BANKS listed on the signature pages hereof (and their
successors and assigns) 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 (with the singular form to
include the plural form and vice-versa):
"Acquisition Loan" means any loan, advance or other extension
of credit by the Borrower to a Subsidiary within the Insurance Group, if the
proceeds of such loan, advance or other extension of credit are used by such
Subsidiary to acquire outstanding Capital Stock or assets of any Person (other
than a Subsidiary) engaged principally in the life insurance business or the
television broadcasting business.
"Adjusted Cash Flow" for any period means the sum of (i) Cash
Flow for such period and (ii) Interest Expense for such period.
"Adjusted London Interbank Offered Rate" has the meaning set
forth in Section 2.06(c).
"Affiliate" means (i) any Person that directly, or indirectly
through one or more intermediaries, controls the Borrower (a "Controlling
Person"), (ii) any Person (other than the Borrower or a Subsidiary) which is
controlled by or is under common control with a Controlling Person, or (iii)
any Person (other than a Subsidiary) of which the Borrower 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 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.
"Aggregate Value of Investment Properties" means the aggregate
value, without duplication, of all Investment Properties, as shown on the
Borrower's or Subsidiary's (as the case may be) books and records and as
determined in accordance with generally accepted accounting
<PAGE> 10
principles consistently applied; provided, however, for the purposes of Section
5.25(b), the calculation of "Aggregate Value of Investment Properties" shall
not include the value of Investment Properties acquired in connection with the
acquisition of a Person if the assets or any stock or other equity interests in
such Person were acquired within nine (9) months of the date of calculation.
"Aggregate Value of Total Investments" means the aggregate
value, without duplication, of all bonds, redeemable preferred stocks,
non-redeemable preferred stocks, common stocks, mortgage loans, loans to policy
holders, other long term investments, short term investments, and Investment
Properties of the Borrower and its Subsidiaries, as shown on the Borrower's or
Subsidiary's (as the case may be) books and records and as determined in
accordance with generally accepted accounting principles consistently applied.
"Anniversary Date" means March 21, 1996 and March 21 in each
succeeding year thereafter. As used herein, the "First Anniversary Date" means
March 21, 1996 and the "Second Anniversary Date" means March 21, 1997.
"Annual Statement" means, with respect to any Subsidiary
within the Insurance Group, the annual report, statement or other filing made
by such Subsidiary with the insurance department or other governmental
authority of the state in which such Subsidiary is formed or incorporated which
regulates, supervises or otherwise has jurisdiction over such Subsidiary, all
in accordance with statutory accounting principles.
"Applicable Margin" has the meaning set forth in Section
2.06(a).
"Assignee" has the meaning set forth in Section 9.07(c).
"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with Section 9.07(c) substantially in the form attached
hereto as Exhibit F.
"Authority" has the meaning set forth in Section 8.02.
"Bank" means each bank listed on the signature pages hereof as
having a Revolving Credit Commitment, Term Loan Commitment and Convertible Loan
Commitment, and its successors and assigns.
"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 plus the Federal Funds Rate for such day. For
purposes of determining the Base Rate for any day, changes in the Prime Rate
and Federal Funds Rate shall be effective on the date of each such change.
"Base Rate Borrowing" means: (i) a Term Loan Borrowing if the
advances under such borrowing bear or are to bear interest calculated by
reference to the Base Rate; (ii) a Revolving Credit Borrowing if the advances
under such borrowing bear or are to bear interest
-2-
<PAGE> 11
calculated by reference to the Base Rate; and (iii) a Convertible Loan
Borrowing if the advances under such borrowing bear or are to bear interest
calculated by reference to the Base Rate.
"Base Rate Loan" means: (i) the Term Loans during periods in
which the Term Loans bear or are to bear interest calculated by reference to
the Base Rate; (ii) Revolving Credit Advances which bear or are to bear
interest calculated by reference to the Base Rate; and (iii) the Convertible
Loans during periods in which the Convertible Loans bear or are to bear
interest calculated by reference to the Base Rate.
"Book Value" means, with respect to any asset, the cost of
such asset, minus accumulated depreciation or amortization, if any, with
respect to such asset.
"Borrower" means The Liberty Corporation, a South Carolina
corporation, and its successors.
"Capital Expenditures" means for any period the sum of all
capital expenditures incurred during such period by the Borrower and its
Consolidated Subsidiaries, as determined in accordance with generally accepted
accounting principles consistently applied.
"Capital Stock" of any Person means any redeemable or
nonredeemable shares of capital stock of such Person (to the extent issued to a
Person other than the Borrower), whether common or preferred.
"Cash Flow" for any period means the sum of (i) Test Income
for such period, (ii) depreciation, amortization and all other non-cash charges
of the Borrower, Cosmos and the Minor Subsidiaries for such period, (iii) all
dividends paid by any Subsidiary to the Borrower or any Minor Subsidiary during
such period in respect of shares of common stock or preferred stock of such
Subsidiary owned by the Borrower or any Minor Subsidiary, (iv) net cash
proceeds from capital asset and operating asset sales of LIG, (v) all Stock
Payments with respect to preferred stock of Liberty Life paid by Liberty Life
to the Borrower during such period, and (vi) all payments of principal of
Acquisition Loans received by the Borrower during such period.
"CERCLA" means the Comprehensive Environmental Response
Compensation and Liability Act.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Information System established pursuant to CERCLA.
"Change of Law" shall have the meaning set forth in Section
8.02.
"Closing Date" means March 21, 1995.
"Code" means the Internal Revenue Code of 1986, as amended, or
any successor Federal tax code. Any reference to any provision of the Code
shall also be deemed to be a reference to any successor provision or provisions
thereof.
-3-
<PAGE> 12
"Commitments" shall mean the Convertible Loan Commitments,
Revolving Credit Commitments or Term Loan Commitments, or any or all of them,
as the context shall require.
"Consolidated Debt" means at any date the Debt of the Borrower
and its Consolidated Subsidiaries, determined on a consolidated basis as of
such date.
"Consolidated Operating Profits" means, for any period, the
Operating Profits of the Borrower and its Consolidated Subsidiaries.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which, in accordance with generally accepted
accounting principles consistently applied, would be consolidated with those of
the Borrower in its consolidated financial statements as of such date.
"Consolidated Total Assets" means, at any time, the total
assets of the Borrower and its Consolidated Subsidiaries, determined on a
consolidated basis, as set forth or reflected on the most recent consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries, prepared in
accordance with generally accepted accounting principles consistently applied.
"Consolidated Total Capital" means, at any time, the sum of
(i) Stockholders' Equity and (ii) Consolidated Debt.
"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.
"Conversion Date" means the date specified by the Borrower in
the Conversion Notice as the "Conversion Date" which date: (i) shall not be
more than 30 days nor less than 3 days from the date on which the Agent
receives the Conversion Notice; (ii) shall be the last day of the Interest
Period applicable to the outstanding Convertible Loans; and (iii) shall be on
or before the Second Anniversary Date. In the event the Borrower does not
deliver a Conversion Notice to the Agent on or before the Second Anniversary
Date pursuant to Section 2.14, the terms, conditions and provisions of this
Agreement and the other Loan Documents which: (i) are effective after the
Conversion Date shall be without meaning and shall be ignored; and (ii) are
effective prior to the Conversion Date shall remain in full force and effect.
"Conversion Notice" means written notice executed by the
Borrower and delivered to the Agent pursuant to Section 2.14.
"Convertible Loan Borrowing" shall mean a borrowing under the
Convertible Loan Commitments consisting of advances made to the Borrower at the
same time by, in the case of a Syndicated Convertible Loan Borrowing, the Banks
pursuant to Section 2.01 (c), or in the case of a Money Market Convertible Loan
Borrowing, one or more of the Banks, pursuant to Section 2.03. A Convertible
Loan Borrowing is a "Syndicated Convertible Loan Borrowing" if such advances
are Syndicated Convertible Loans or a "Money Market Convertible Loan Borrowing"
if such advances are Money Market Convertible Loans. A Convertible Loan
Borrowing is a
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<PAGE> 13
"Euro-Dollar Borrowing" if such advances are made as Euro-Dollar Loans and a
"Base Rate Borrowing" if such advances are made as Base Rate Loans.
"Convertible Loan Commitment" means, with respect to each
Bank, (i) the amount designated as the Convertible Loan Commitment set forth
opposite the name of such Bank on the signature pages hereof, or (ii) as to any
Bank which enters into an Assignment and Acceptance (whether as Transferor Bank
or as Assignee thereunder), the amount of such Bank's Convertible Loan
Commitment after giving effect to such Assignment and Acceptance, in each case
as such amount may be reduced from time to time pursuant to Sections 2.08 and
2.09.
"Convertible Loan Commitment Reduction Date" means each June
30, September 30, December 31 and March 31, commencing on June 30, 1997, and
continuing thereafter until March 31, 2002.
"Convertible Loan Maturity Date" means March 21, 1998, as such
date may be extended pursuant to Section 2.05(c)(ii) or Section 2.14.
"Convertible Loans" means any loan made by the Banks under the
Convertible Loan Commitment. At no time shall there be more than four (4)
different Interest Periods applicable to the Convertible Loans outstanding at
the same time; provided that if the Borrower delivers to the Agent the
Conversion Notice, then (i) at no time after the Conversion Date shall there be
more than one (1) Interest Period applicable to the Convertible Loans
outstanding at the same time (for which purpose Interest Periods described in
different numbered clauses of the definition of the term "Interest Period"
shall be deemed to be different Interest Periods even if they are coterminous);
(ii) after the Conversion Date, all Convertible Loans which are Euro-Dollar
Loans shall subject to the terms of paragraph (1) of the definition of Interest
Period, have an Interest Period of three (3) months; and (iii) after the
Conversion Date, all Convertible Loans which are Base Rate Loans shall subject
to the terms of paragraph (2) of the definition of Interest Period, have an
Interest Period of 90 days.
"Cosmos" means Cosmos Broadcasting Corporation, a South
Carolina corporation.
"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, (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 under a banker's acceptance, (vi) all
Non-Convertible Redeemable Preferred Stock of such Person (in the event such
Person is a corporation), (vii) all obligations (absolute or contingent) of
such Person to reimburse any bank or other Person in respect of amounts 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 of others Guaranteed by such Person.
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<PAGE> 14
"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 in writing, become an Event of Default.
"Default Rate" means, with respect to any Loan, for 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 Borrower and its Consolidated Subsidiaries for
such period, as determined in accordance with generally accepted accounting
principles consistently applied.
"Dollars" or "$" means dollars in lawful currency of the
United States of America.
"Domestic Business Day" means any day except a Saturday,
Sunday or other day on which commercial banks in Georgia or New York are
authorized or required by law to close.
"Environmental Authorizations" means all licenses, permits,
orders, approvals, notices, registrations or other legal prerequisites for
conducting the business of the Borrower and its Subsidiaries required by any
Environmental Requirement.
"Environmental Authority" means any foreign, federal, state,
local or regional government that exercises any form of jurisdiction or
authority under 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 Notice" means notice from any Environmental
Authority or by any other person or entity, of possible or alleged
noncompliance with 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.
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<PAGE> 15
"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 Borrower,
any Subsidiary or the Properties, including but not limited to any such
requirement under CERCLA or similar state legislation.
"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 Borrowing" means: (i) a Term Loan Borrowing if
the advances under such borrowing bear or are to bear interest calculated by
reference to the Adjusted London Interbank Offered Rate; (ii) a Revolving
Credit Borrowing if the advances under such borrowing bear or are to bear
interest calculated by reference to the Adjusted London Interbank Offered Rate;
and (iii) a Convertible Loan Borrowing if the advances under such borrowing
bear or are to bear interest calculated by reference to the Adjusted London
Interbank Offered Rate.
"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: (i) the Term Loans during periods
in which the Term Loans bear interest calculated by reference to the Adjusted
London Interbank Offered Rate; (ii) Revolving Credit Advances which bear or
are to bear interest calculated by reference to the Adjusted London Interbank
Offered Rate; and (iii) the Convertible Loans during periods in which the
Convertible Loans bear interest calculated by reference to the Adjusted London
Interbank Offered Rate.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.05(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Fair Market Value" means, with respect to any asset, the
greater of: (i) the Gross Proceeds received by the Borrower or any Subsidiary
in connection with the sale, transfer or other disposition by the Borrower or
such Subsidiary (as the case may be) of such asset; or (ii) the Book Value of
such asset.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded, if necessary, to the nearest 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
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<PAGE> 16
day, the Federal Funds Rate for such day shall be the average rate charged to
Wachovia on such day on such transactions as determined by the Agent.
"Film Payments" means cash payments for syndicated film
products, such as first-run and off-network programs.
"Fiscal Quarter" means any fiscal quarter of the Borrower.
"Fiscal Year" means any fiscal year of the Borrower.
"Fixed Charges" means the sum of (i) Interest Expense for the
period of four Fiscal Quarters ending on the last day of the Fiscal Quarter
with respect to which the determination of Fixed Charges is being made, (ii)
all dividends or other distributions paid by the Borrower in respect of the
Liberty Corporation Preferred Stock for the period of four Fiscal Quarters
ending on the last day of the Fiscal Quarter with respect to which the
determination of Fixed Charges is being made, (iii) Film Payments which are
scheduled to be made by Cosmos during the four Fiscal Quarters immediately
following the Fiscal Quarter with respect to which the determination of Fixed
Charges is being made, and (iv) all payments of principal in respect of Debt of
the Borrower, Cosmos or any Minor Subsidiary which are scheduled to be made
during the four Fiscal Quarters immediately following the Fiscal Quarter with
respect to which the determination of Fixed Charges is being made.
"Forfeiture Proceeding" means any action, proceeding or
investigation affecting the Borrower or any of its Subsidiaries before any
court, governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, if such action, proceeding or
investigation could result in (i) the seizure or forfeiture of any of their
assets, revenues or share capital, which when the Fair Market Value of such
assets, revenues or share capital subject to such seizure or forfeiture when
aggregated with the Fair Market Value of all other assets, revenues and share
capital of the Borrower and its Subsidiaries seized or forfeited since the
Closing Date exceeds $2,500,000, or (ii) a material adverse change in the
business, financial position, results of operations or prospects of the
Borrower or any of its Subsidiaries.
"Gross Proceeds" means any and all cash, plus the face amount
of any and all notes, bonds, debentures, instruments and evidences of
indebtedness, and the value of any other property, of whatever kind or nature,
received by the Borrower or any Subsidiary in connection with the sale,
transfer or other disposition by the Borrower or such Subsidiary (as the case
may be) of any of its assets.
"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
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<PAGE> 17
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, or in any applicable state or local law or regulation, (b) hazardous
substances, as defined in CERCLA, or in any applicable state or local law or
regulation, (c) gasoline, or any other petroleum product or by-product, (d)
toxic substances, as defined in the Toxic Substances Control Act of 1976, or in
any applicable state or local law or regulation and (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.
"Income" means, as applied to any Person for any period, the
aggregate amount of income of such Person, before taxes, for such period, as
determined in accordance with generally accepted accounting principles
consistently applied.
"Insurance Group" shall mean and include, collectively, all
existing and future Subsidiaries which are licensed in one or more states to
sell insurance or engaged principally in the insurance business.
"Intercompany Loan" means any loan, advance or other extension
of credit made in the ordinary course of business (i) by the Borrower to any
Subsidiary; (ii) by any Subsidiary to the Borrower; or (iii) by any
Consolidated Subsidiary to any other Consolidated Subsidiary; provided that the
aggregate outstanding principal amount of Intercompany Loans made by
Consolidated Subsidiaries to other Consolidated Subsidiaries shall at no time
exceed 20% of Stockholders' Equity.
"Interest Expense" for any period means interest, whether
expensed or capitalized, in respect of Debt of the Borrower, Cosmos or any of
the Minor Subsidiaries outstanding during such period.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such borrowing, and ending on
the numerically corresponding day in the first, second, third or sixth calendar
month thereafter, as the Borrower may elect in the applicable Notice of
Borrowing; provided that:
(a) any Interest Period (other than an Interest Period
determined pursuant to clause (c) below) which would otherwise end on a day
which is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day falls
in another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the
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<PAGE> 18
appropriate subsequent calendar month) shall, subject to clause (c) below, end
on the last Euro-Dollar Business Day of the appropriate subsequent calendar
month; and
(c) (i) any Interest Period applicable to the Term Loans
which begins before the Term Loan Maturity Date and would otherwise end after
the Term Loan Maturity Date shall end on the Term Loan Maturity Date; (ii) any
Interest Period applicable to a Revolving Credit Advance which begins before
the Revolving Credit Maturity Date and would otherwise end after the Revolving
Credit Maturity Date shall end on the Revolving Credit Maturity Date; and (iii)
any Interest Period applicable to the Convertible Loans which begins before the
Convertible Loan Maturity Date and would otherwise end after the Convertible
Loan Maturity Date shall end on the Convertible Loan Maturity Date.
(2) with respect to each Base Rate Borrowing, the period
commencing on the date of such borrowing and ending: (i) in the case of a
Convertible Loan prior to the Conversion Date or a Revolving Credit Advance, 30
days thereafter and (ii) in the case of a Convertible Loan after the Conversion
Date or a Term Loan, 90 days thereafter; provided that:
(a) any Interest Period (other than an Interest Period
determined pursuant 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;
(b) (i) any Interest Period applicable to the Term Loans
which begins before the Term Loan Maturity Date and would otherwise end after
the Term Loan Maturity Date shall end on the Term Loan Maturity Date; (ii) any
Interest Period applicable to a Revolving Credit Advance which begins before
the Revolving Credit Maturity Date and would otherwise end after the Revolving
Credit Maturity Date shall end on the Revolving Credit Maturity Date; and (iii)
any Interest Period applicable to the Convertible Loans which begins before the
Convertible Loan Maturity Date and would otherwise end after the Convertible
Loan Maturity Date shall end on the Convertible Loan Maturity Date.
(3) with respect to each Money Market Convertible Loan
Borrowing and each Money Market Revolving Credit Borrowing, the period
commencing on the date of such borrowing and ending 7 to 180 days thereafter,
as the Borrower may indicate in the applicable Money Market Quote Request;
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
(b) (i) any Interest Period applicable to a Money Market
Revolving Credit Borrowing which begins before the Revolving Credit
Maturity Date and would otherwise end after the Revolving Credit
Maturity Date shall end on the Revolving Credit Maturity Date; and
(ii) any Interest Period applicable to a Money Market Convertible
Borrowing which begins before the Convertible Loan Maturity Date and
would otherwise end after the Convertible Loan Maturity Date shall end
on the Convertible Loan Maturity Date.
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<PAGE> 19
"Investment Properties" for any period means all real property
owned by the Borrower and its Consolidated Subsidiaries during the applicable
period; provided, however, the definition of Investment Properties shall
exclude any real property if: (i) at least fifty percent (50%) of the net
leasable area with respect to such real property is occupied by the Borrower
and/or its Subsidiaries; and (ii) the primary use of such real property is the
operation of the Borrower's and/or Subsidiaries' respective businesses.
"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.
"Liberty Capital" means Liberty Capital Advisors, Inc., a
South Carolina corporation.
"Liberty Corporation Preferred Stock" means any redeemable or
nonredeemable, preferred capital stock of the Borrower.
"Liberty Insurance Services" means Liberty Insurance Services
Corporation, a South Carolina corporation.
"Liberty Life" means Liberty Life Insurance Company, a South
Carolina corporation.
"Liberty Properties" means Liberty Properties Group, Inc., a
South Carolina corporation.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset. For the purposes of this Agreement, the Borrower or any 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 relating to such
asset.
"LIG" means Liberty Investment Group, Inc., a South Carolina
corporation.
"Loan" means a Syndicated Revolving Credit Advance, a
Syndicated Convertible Loan, a Term Loan, a Money Market Revolving Credit
Advance or a Money Market Convertible Loan and "Loans" means Syndicated
Revolving Credit Advances, Syndicated Convertible Loans, Term Loans, Money
Market Revolving Credit Advances or Money Market Convertible Loans, or any or
all of them, as the context shall require.
"Loan Documents" means this Agreement, the Notes and any other
document evidencing or securing the Loans.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.06(c).
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<PAGE> 20
"Margin Stock" means "margin stock" as defined in Regulation
G, T, U or 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.
"Minor Subsidiaries" shall mean and include, collectively:
(i) Liberty Capital; LIG; Liberty Properties; LPG Development Corporation, a
South Carolina corporation; SouthChase Development Corporation, a South
Carolina corporation; LIBCO of Virginia, Inc., a Virginia corporation; LIBCO of
Florida, Inc., a Florida corporation; LPC of S.C., Inc., a South Carolina
corporation; LIBCO of Tennessee, Inc., a Tennessee corporation; Commerce Center
of Greenville, Inc., a South Carolina corporation; Special Services
Corporation, a South Carolina corporation; Hampton Insurance Agency, Inc., a
South Carolina corporation; The Liberty Marketing Corporation, a South
Carolina corporation; Bent Tree Corporation, a Georgia corporation; TLC
Business Ventures, Inc., a South Carolina corporation; Cable Vantage Inc., a
South Carolina corporation; Liberty Stone Associates, Inc., a South Carolina
corporation; State National Life Agency Corporation, a Louisiana corporation;
State National General Insurance Agency, Inc., a Louisiana corporation; Delta
National Equity Corporation, a Louisiana corporation; LC Insurance Ltd.,
organized under the laws of Bermuda; Estate Assurance Company, a Louisiana
corporation, and The Liberty Corporation Foundation, a South Carolina
corporation; and (ii) other Subsidiaries of the Borrower, designated by the
Borrower as a "Minor Subsidiary" in the manner and in accordance with the
following standards. Borrower may designate any Subsidiary (including any
newly acquired or newly formed Subsidiary) to be a "Minor Subsidiary"; provided
that: (x) the Subsidiary to be so designated is created or acquired in the
ordinary course of the Borrower's business; and (y) immediately after giving
effect to such designation, no Default or Event of Default shall have occurred
or be continued. Upon any such designation by the Borrower, the Borrower shall
provide the Agent and the Banks written notice identifying the Minor Subsidiary
being so designated.
"Money Market Convertible Loan" means a Convertible Loan which
bears or is to bear interest at a Money Market Rate.
"Money Market Revolving Credit Advance" means a Revolving
Credit Advance which bears or is to bear interest at a Money Market Rate.
"Money Market Revolving Credit Notes" means promissory notes
of the Borrower, substantially in the form of Exhibit A-2 hereto, evidencing
the obligation of the Borrower to repay the Money Market Revolving Credit
Advances.
"Money Market Convertible Loan Notes" means promissory notes
of the Borrower, substantially in the form of Exhibit A-5 hereto, evidencing
the obligation of the Borrower to repay the Money Market Convertible Loans.
"Money Market Quote" means an offer by a Bank to make a Money
Market Convertible Loan or a Money Market Revolving Credit Advance, as the case
may be, in accordance with Section 2.03(c).
"Money Market Quote Request" has the meaning set forth in
Section 2.03(b).
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<PAGE> 21
"Money Market Rate" has the meaning set forth in Section
2.03(c)(ii)(C).
"Multiemployer Plan" shall have the meaning set forth in
Section 4001(a)(3) of ERISA.
"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 generally accepted accounting
principles consistently applied.
"Net Proceeds of Convertible Preferred Stock" means any
proceeds received by the Borrower or a Subsidiary in respect of the issuance of
convertible preferred stock, after deducting therefrom all reasonable costs and
expenses incurred by the Borrower or such Subsidiary in connection with the
issuance of such convertible preferred stock.
"Net Proceeds of Debt" means any proceeds received by the
Borrower or a Subsidiary in respect of the public offering of any Debt of the
Borrower or such Subsidiary after deducting therefrom all reasonable costs and
expenses incurred by the Borrower or such Subsidiary in connection with the
issuance of such Debt.
"Net Proceeds of Preferred Stock" means any proceeds received
by the Borrower or a Subsidiary in respect of the issuance of preferred stock
(whether or not such preferred stock is convertible) by the Borrower or such
Subsidiary, after deducting therefrom all reasonable costs and expenses
incurred by the Borrower or such Subsidiary in connection with the issuance of
such preferred stock.
"Non-Convertible Redeemable Preferred Stock" of any Person
means Redeemable Preferred Stock that is redeemable, either in whole or in
part, into any property (including, without limitation, cash) other than the
capital stock of the Person.
"Nonredeemable Capital Stock" means any nonredeemable capital
stock of the Borrower or any Subsidiary (to the extent issued to a Person other
than the Borrower), whether common or preferred.
"Notes" shall mean the Syndicated Revolving Credit Notes, the
Money Market Revolving Credit Notes, the Term Loan Notes, the Syndicated
Convertible Loan Notes and the Money Market Convertible Loan Notes of the
Borrower payable to the order of the respective Banks, evidencing the maximum
principal indebtedness of the Borrower under the Revolving Credit Commitments,
Term Loan Commitments and Convertible Loan Commitments, in substantially the
forms of Exhibits A-1, A-2, A-3, A-4 and A-5 respectively, either as originally
executed or as they may be from time to time supplemented, modified, amended,
renewed or extended, or any or all of them, as the context shall require.
"Notice of Borrowing" has the meaning set forth in Section
2.02.
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<PAGE> 22
"Operating Profits" means, as applied to any Person for any
period, the operating income of such Person for such period, as determined in
accordance with generally accepted accounting principles consistently applied.
"Participant" has the meaning set forth in Section 9.07(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Advances" means (i) Intercompany Loans and (ii)
Acquisition Loans.
"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.
"Pierce National" means Pierce National Life Insurance Co., a
California corporation.
"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 five 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.
"Prior Credit Agreement" means the Credit Agreement dated as
of Sepember 28, 1993, as amended, among the Company, the banks party thereto,
and Wachovia Bank of North Carolina, N.A., as Agent.
"Properties" means all real property owned, leased or
otherwise used or occupied by the Borrower or any Subsidiary, wherever located.
"Quotation Date" has the meaning set forth in Section 2.03(b).
"Rate Determination Date" has the meaning set forth in Section
2.06(a).
"Redeemable Preferred Stock" of any Person means as of any
date any preferred stock issued by such Person which is at any time within one
(1) year of such date either (i) mandatorily redeemable (by sinking fund or
similar payments or otherwise) or (ii) redeemable at the option of the holder
thereof.
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<PAGE> 23
"Reported Net Income" means, for any period, the Net Income of
the Borrower 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 amount of the Commitments or, if the Commitments are no
longer in effect, Banks holding at least 66 2/3% of the aggregate outstanding
principal amount of the Notes.
"Restricted Payment" means any dividend or other distribution
on any shares of the Borrower's Capital Stock (except dividends payable solely
in shares of its Capital Stock).
"Revolving Credit Advance" means any advance by the Banks
under the Revolving Credit Commitments.
"Revolving Credit Borrowing" shall mean a borrowing under the
Revolving Credit Commitment consisting of Revolving Credit Advances made to the
Borrower at the same time by, in the case of a Syndicated Revolving Credit
Borrowing, the Banks or in the case of a Money Market Revolving Credit
Borrowing, one or more of the Banks. A Revolving Credit Borrowing is a
"Syndicated Revolving Credit Borrowing" if such advances are Syndicated
Revolving Credit Advances" or a "Money Market Revolving Credit Borrowing" if
such advances are Money Market Revolving Credit Advances. A Revolving Credit
Borrowing is a "Euro-Dollar Borrowing" if such Revolving Credit Advances are
made as Euro-Dollar Loans and a "Base Rate Borrowing" if such Revolving Credit
Advances are made as Base Rate Loans.
"Revolving Credit Commitment" means with respect to each
Bank, (i) the amount designated as the Revolving Credit Commitment set forth
opposite the name of such Bank on the signature pages hereof, or (ii) as to any
Bank which enters into an Assignment and Acceptance (whether as transferor Bank
or as Assignee thereunder), the amount of such Bank's Revolving Credit
Commitment after giving effect to such Assignment and Acceptance, in each case
as such amount may be reduced from time to time pursuant to Sections 2.08 and
2.09.
"Revolving Credit Maturity Date" shall mean March 21, 1998 as
such date may be extended pursuant to Section 2.05(a)(ii);
"Stock Payment" means any payment (whether in the form of
money or property) made by the Borrower or any Subsidiary on account of the
purchase, redemption, retirement or acquisition by such Borrower or Subsidiary
of any shares of its Capital Stock. As to any payment made in the form of
property, the amount of such payment shall be deemed to be equal to the fair
market value of such property.
"Stockholders' Equity" means, at any time, the shareholders'
equity of the Borrower and its Consolidated Subsidiaries, as set forth or
reflected on the most recent consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries prepared in accordance with generally accepted
accounting principles consistently applied, but excluding any Non-Convertible
Redeemable Preferred Stock of the Borrower or any of its Consolidated
Subsidiaries. Shareholders' equity would generally include, but not be limited
to (i) the par or stated value of all outstanding Nonredeemable Capital Stock
plus paid in capital, (ii) capital
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<PAGE> 24
surplus, (iii) retained earnings, (iv) unearned stock compensation, (v)
cumulative foreign currency translation adjustments and (vi) subtracting items
such as (A) purchases of treasury stock, (B) unrealized investment losses, (C)
receivables due from an employee stock ownership plan and (D) employee stock
ownership plan debt guarantees, provided, however, that Stockholders' Equity
shall exclude unrealized gains and losses resulting from adjusting the book
value of securities from a cost basis to a market basis in accordance with
Financial Accounting Standards Board Statement No. 115.
"Subsidiary" means any corporation or other entity (including,
without limitation, Liberty Life, Pierce National, Liberty Insurance Services,
Cosmos, North American National Corporation and American Funeral Assurance
Company) 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 Borrower.
"Surplus Relief Reinsurance Transaction" shall mean any
transaction in which any Subsidiary within the Insurance Group cedes business
under a reinsurance agreement that would be considered a "financing-type"
reinsurance agreement as determined by the independent certified public
accountants of the Subsidiaries within the Insurance Group in accordance with
generally accepted accounting principles, as the same may be revised from time
to time.
"Syndicated Convertible Loan" means a Convertible Loan which
is a Base Rate Loan or a Euro-Dollar Loan and Syndicated Convertible Loans
means Convertible Loans which are Base Rate Loans or Euro-Dollar Loans, or any
or all of them, as the context shall require.
"Syndicated Convertible Loan Notes" means promissory notes of
the Borrower, substantially in the form of Exhibit A-4 hereto, evidencing the
obligation of the Borrower to repay the Syndicated Convertible Loans, together
with all amendments, consolidations, modifications, renewals and supplements
thereto and "Syndicated Convertible Loan Note" means any one of such Syndicated
Convertible Loan Notes.
"Syndicated Revolving Credit Advance" means a Revolving Credit
Advance which is a Base Rate Loan or a Euro-Dollar Loan and Syndicated
Revolving Credit Advances means Revolving Credit Advances which are Base Rate
Loans or Euro-Dollar Loans, or any or all of them, as the context shall
require.
"Syndicated Revolving Credit Notes" means promissory notes of
the Borrower, substantially in the form of Exhibit A-1 hereto, evidencing the
obligation of the Borrower to repay the Syndicated Revolving Credit Advances,
together with all amendments, consolidations, modifications, renewals and
supplements thereto and "Syndicated Revolving Credit Note" means any one of
such Syndicated Revolving Credit Notes.
"Term Loans" means any loan made by the Banks under the Term
Loan Commitments. At no time shall there be more than one Interest Period
applicable to the Term Loans outstanding at the same time (for which purpose
Interest Periods described in different numbered clauses of the definition of
the term "Interest Period" shall be deemed to be different
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Interest Periods even if they are coterminous). Any Term Loan which is a
Euro-Dollar Loan shall, subject to the terms of paragraph (1) of the definition
of Interest Period, have an Interest Period of three (3) months. Any Term Loan
which is a Base Rate Loan shall, subject to the terms of paragraph (2) of the
definition of Interest Period, have an Interest Period of 90 days.
"Term Loan Borrowing" shall mean a borrowing under the Term
Loan Commitments consisting of Term Loans made to the Borrower at the same time
by the Banks pursuant to Article II. A Term Loan Borrowing is a "Euro-Dollar
Borrowing" if such Term Loans are made as Euro-Dollar Loans and a "Base Rate
Borrowing" if such Term Loans are made as Base Rate Loans.
"Term Loan Commitment" means, with respect to each Bank, (i)
the amount designated as the Term Loan Commitment set forth opposite the name
of such Bank on the signature pages hereof, or (ii) as to any Bank which enters
into an Assignment and Acceptance (whether as transferor Bank or as Assignee
thereunder), the amount of such Bank's Term Loan Commitment after giving effect
to such Assignment and Acceptance, in each case as such amount may be reduced
from time to time pursuant to Section 2.09.
"Term Loan Commitment Reduction Date" means each June 30,
September 30, December 31 and March 31, commencing on June 30, 1997, and
continuing thereafter until March 31, 2002.
"Term Loan Maturity Date" means March 31, 2002.
"Term Loan Note" means promissory notes of the Borrower,
substantially in the form of Exhibit A-3 hereto evidencing the obligation of
the Borrower to repay the Term Loans.
"Test Income" for any period means the sum of (i) Income of
the Borrower and the Minor Subsidiaries for such period (excluding, however,
(A) all dividends paid by Liberty Life to the Borrower or any Minor Subsidiary
during such period in respect of shares of common stock or preferred stock of
Liberty Life owned by the Borrower or any Minor Subsidiary, and (B) adjustments
for capital gains and capital losses and operating gains and operating losses
on asset sales realized by the Borrower and the Minor Subsidiaries for such
period) and (ii) Income of Cosmos for such period.
"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.
"Transferee" has the meaning set forth in Section 9.07(d).
"Unmatured Prior Loans" means the following Borrowings under
the Prior Credit Agreement: (i) a $115,000,000 Money Market Borrowing with an
interest period maturing March 31, 1995; and (ii) a $47,000,000 Money Market
Borrowing with an interest period maturing March 29, 1995.
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"Unused Convertible Loan Commitment" means at any date, with
respect to any Bank, an amount equal to its Convertible Loan Commitment less
the aggregate outstanding principal amount of its Convertible Loans on such
day.
"Unused Revolving Credit Commitment" means at any date, with
respect to any Bank, an amount equal to its Revolving Credit Commitment less
the aggregate outstanding principal amount of its Revolving Credit Advances on
such day.
"Wachovia" means Wachovia Bank of Georgia, N.A., a national
banking association and its successors.
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 generally accepted accounting principles, applied
on a basis consistent (except for changes concurred in by the Borrower's
independent public accountants or otherwise required by a change in generally
accepted accounting principles) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries
delivered to the Banks, unless with respect to any such change concurred in by
the Borrower's independent public accountants or required by generally accepted
accounting principles, in determining compliance with any of the provisions of
this Agreement or any of the other Loan Documents: (i) the Borrower 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 "Sections" are references to sections hereof
and references in this Agreement to "Articles" are references to articles
hereof.
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend.
(a) The Revolving Credit. Each Bank severally agrees, on
the terms and conditions set forth herein, to make Syndicated Revolving Credit
Advances to the Borrower from time to time before the Revolving Credit Maturity
Date; provided that, immediately after each such Revolving Credit Advance is
made, the aggregate outstanding principal amount of Syndicated Revolving Credit
Advances by such Bank shall not exceed the amount of its Revolving Credit
Commitment, and provided further that the aggregate principal amount of all
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Syndicated Revolving Credit Advances, together with the aggregate principal
amount of all Unmatured Prior Loans and Money Market Revolving Credit Advances
at any one time outstanding shall not exceed the aggregate amount of the
Revolving Credit Commitments of all of the Banks at such time. Each Syndicated
Revolving Credit Borrowing under this Section shall be in an aggregate
principal amount of: (i) $10,000,000 or any larger multiple of $1,000,000, if
such Revolving Credit Borrowing consists of Revolving Credit Advances made as
Euro-Dollar Loans; and (ii) $2,000,000 or any larger multiple of $1,000,000,
if such Revolving Credit Borrowing consists of Revolving Credit Advances made
as Base Rate Loans (except that any such Revolving Credit Borrowing may be in
the aggregate amount of the Unused Revolving Credit Commitments) and shall be
made from the several Banks ratably in proportion to their respective Revolving
Credit Commitments. Within the foregoing limits, the Borrower may borrow under
this Section 2.01 (a), repay or, to the extent permitted by Section 2.10,
prepay Syndicated Revolving Credit Advances and reborrow under this Section
2.01 (a) at any time before the Revolving Credit Maturity Date.
(b) The Term Loans. Each Bank severally agrees, on the
terms and conditions set forth herein, to make Term Loans to the Borrower from
time to time before the Term Loan Maturity Date; provided that, at no time
shall any Bank have more than one Term Loan outstanding and immediately after
each such Term Loan is made, the aggregate outstanding principal amount of the
Term Loan made by such Bank shall not exceed such Bank's Term Loan Commitment;
and provided further that the aggregate principal amount of all Term Loans at
any one time outstanding shall not exceed the aggregate amount of the Term Loan
Commitments of all of the Banks at such time. Within the foregoing limits, the
Borrower may borrow under this Section 2.01 (b), repay or to the extent
permitted by Section 2.10, prepay Term Loans and reborrow under this Section
2.01 (b) at any time before the Term Loan Maturity Date; provided, however, (i)
after the initial Term Loan Borrowing, the proceeds of any Term Loan Borrowing
shall be used exclusively for the purpose of repaying Term Loans maturing on
the date of such Term Loan Borrowing and for no other purpose; and (ii) the
ability to reborrow may be limited by the provisions of Section 2.09(b)(3)
hereof; (iii) each Term Loan Borrowing shall be made from the several Banks
ratably in proportion to their respective Term Loan Commitments; and (iv) the
initial Term Loan Borrowing shall be made on or before April 1, 1995.
(c) The Convertible Loans. Each Bank severally agrees,
on the terms and conditions set forth herein, to make Syndicated Convertible
Loans to the Borrower from time to time before the Convertible Loan Maturity
Date; provided that, at no time prior to or on the Conversion Date shall any
Bank have more than four (4) Syndicated Convertible Loans outstanding and at no
time after the Conversion Date shall any Bank have more than one (1) Syndicated
Convertible Loan outstanding; provided further that immediately after each such
Syndicated Convertible Loan is made, the aggregate outstanding principal amount
of the Syndicated Convertible Loans by such Bank shall not exceed such Bank's
Convertible Loan Commitment, provided further that the aggregate principal
amount of all Syndicated Convertible Loans, together with the aggregate
principal amount of all Money Market Convertible Loans, at any one time
outstanding shall not exceed the aggregate amount of the Convertible Loan
Commitments of all of the Banks at such time. Each Convertible Loan Borrowing
made under this Paragraph 2.01 (c) shall be in an aggregate principal amount
of: (i) $10,000,000 or any larger multiple of $1,000,000, if such Convertible
Loan Borrowing consists of Convertible Loans made as Euro-Dollar Loans; and
(ii) $2,000,000 or any larger multiple of $1,000,000, if such
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Convertible Loan Borrowing consists of Convertible Loans made as Base Rate
Loans (except that any Convertible Loan Borrowing may be in the aggregate
amount of the Unused Convertible Loan Commitments) and shall be made from the
several Banks ratably in proportion to their respective Convertible Loan
Commitments. Within the foregoing limits, the Borrower may borrow under this
Section 2.01 (c), repay or, to the extent permitted by Section 2.10, prepay
Syndicated Convertible Loans and reborrow under this Section 2.01 (c) at any
time before the Convertible Loan Maturity Date; provided, however, that after
the Conversion Date; (i) the proceeds of any Convertible Loan Borrowing shall
be used exclusively for the purpose of repaying Convertible Loans maturing on
the date of such Convertible Loan Borrowing and for no other purpose; and (ii)
the ability to reborrow may be limited by the provisions of Section 2.09 (c)(4)
hereof.
SECTION 2.02. Method of Borrowing Term Loans and Syndicated
Loans. (a) The Borrower shall give the Agent notice in the form attached
hereto as Exhibit G (a "Notice of Borrowing") prior to 11:00 A.M. (Atlanta,
Georgia time) on the Domestic Business Day of each Base Rate Borrowing and at
least 3 Euro-Dollar Business Days before each Euro-Dollar Borrowing,
specifying:
(i) whether such borrowing constitutes a Syndicated
Revolving Credit Borrowing, Term Loan Borrowing or Syndicated
Convertible Loan Borrowing, and the date of such borrowing, which
shall be a Domestic Business Day in the case of a Base Rate Borrowing
or a Euro-Dollar Business Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of the Syndicated Revolving
Credit Borrowing, Term Loan Borrowing or Syndicated Convertible Loan
Borrowing, as the case may be, and
(iii) whether the Term Loans comprising a Term Loan
Borrowing, the Revolving Credit Advances comprising a Syndicated
Revolving Credit Borrowing or the Convertible Loans comprising a
Syndicated Convertible Loan Borrowing are to be Base Rate Loans or
Euro-Dollar Loans, and 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 Syndicated Revolving Credit Borrowing, Term Loan
Borrowing or Syndicated Convertible Loan Borrowing, as the case may be, and
such Notice of Borrowing shall not thereafter be revocable by the Borrower.
(c) Not later than 1:00 p.m. (Atlanta, Georgia time) on
the date of each Syndicated Revolving Credit Borrowing, Term Loan Borrowing or
Syndicated Convertible Loan Borrowing, as the case may be, referenced in the
Notice of Borrowing, each Bank shall (except as provided in subsection (d) of
this Section) make available its ratable share of such Syndicated Revolving
Credit Borrowing, Term Loan Borrowing, or Syndicated Convertible Loan
Borrowing, as the case may be, in Federal or other funds immediately available
in Atlanta, Georgia, to the Agent at its address referred to in or specified
pursuant to 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
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aforesaid address. Unless the Agent receives notice from a Bank, at the
Agent's address referred to in Section 9.01, no later than 4:00 P.M. (local
time at such address) on the Domestic Business Day before the date of the
applicable Syndicated Revolving Credit Borrowing, Term Loan Borrowing or
Syndicated Convertible Loan Borrowing stating that such Bank will not make the
applicable Syndicated Revolving Credit Advance, Term Loan or Syndicated
Convertible Loan in connection with such Syndicated Revolving Credit Borrowing,
Term Loan Borrowing or Syndicated Convertible Loan Borrowing, as the case may
be, the Agent shall be entitled to assume that such Bank will make the
Syndicated Revolving Credit Advance, Term Loan or Syndicated Convertible Loan
in connection with such Syndicated Revolving Credit Borrowing, Term Loan
Borrowing or Syndicated Convertible Loan 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 Revolving Credit Borrowing, Term Loan
Borrowing or Syndicated Convertible Loan Borrowing, as the case may be, 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 Revolving Credit Borrowing, Term Loan Borrowing or
Syndicated Convertible Loan Borrowing, as the case may be, 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 Revolving Credit Borrowing, Term Loan Borrowing or Syndicated
Convertible Loan Borrowing, as the case may be, 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 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. If such
Bank shall repay to the Agent such corresponding amount, such amount so repaid
shall constitute such Bank's Revolving Credit Advance, Term Loan or Convertible
Loan, as the case may be, included in such borrowing for purposes of this
Agreement.
(d) If any Bank makes: (i) a new Syndicated Revolving
Credit Advance hereunder on a day on which the Borrower is to repay all or any
part of an outstanding Syndicated Revolving Credit Advance from such Bank; (ii)
a new Term Loan hereunder on a day on which the Borrower is to repay all or any
part of an outstanding Term Loan from such Bank; or (iii) a new Syndicated
Convertible Loan hereunder on a day on which the Borrower is to repay all or
any part of an outstanding Syndicated Convertible Loan from such Bank, such
Bank shall apply the proceeds of its new Syndicated Revolving Credit Advance,
Term Loan or Syndicated Convertible Loan, as the case may be, to make such
repayment and only an amount equal to the difference (if any) between the
amount being borrowed and the amount being repaid shall be made available by
such Bank to the Agent as provided in subsection (c) of this Section, or
remitted by the 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 Euro-Dollar 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 in writing.
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(f) In the event that a Notice of Borrowing fails to
specify whether the Revolving Credit Advances comprising such Syndicated
Revolving Credit Borrowing, the Convertible Loans comprising such Syndicated
Convertible Loan Borrowing or the Term Loans comprising such Term Loan
Borrowing are to be Base Rate Loans or Euro-Dollar Loans, such Revolving Credit
Advances, Convertible Loans or Term Loans, as the case may be, shall be made as
Base Rate Loans. If the Borrower is otherwise entitled under this Agreement
to: (1) repay any Revolving Credit Advances maturing at the end of an Interest
Period applicable thereto with the proceeds of a new Revolving Credit
Borrowing; or (2) repay any Term Loans maturing at the end of an Interest
Period applicable thereto with the proceeds of a new Term Loan Borrowing; or
(3) repay any Convertible Loans maturing at the end of an Interest Period
applicable thereto with the proceeds of a new Convertible Loan Borrowing, and
the Borrower fails to repay such Revolving Credit Advances, Term Loans or
Convertible Loans, as the case may be, using its own moneys and fails to give a
Notice of Borrowing in connection with a new corresponding Syndicated Revolving
Credit Borrowing, Syndicated Convertible Loan or Term Loan, a new Syndicated
Revolving Credit Borrowing, Syndicated Convertible Loan Borrowing or Term Loan
Borrowing shall be deemed to be made on the date such Revolving Credit
Advances, Convertible Loans or Term Loans, as the case may be, mature in an
amount equal to the principal amount of the Revolving Credit Advances,
Convertible Loans or Term Loans, as the case may be, so maturing, and the
Revolving Credit Advances, Convertible Loans or Term Loans, as the case may be,
comprising such new Syndicated Revolving Credit Borrowing, Syndicated
Convertible Loan Borrowing or Term Loan Borrowing shall be Base Rate Loans.
SECTION 2.03. Money Market Loans. (a) In addition to making
Syndicated Convertible Loans and Syndicated Revolving Credit Advances, the
Borrower may, as set forth in this Section, request the Banks to make offers to
make: (i) Money Market Revolving Credit Advances to the Borrower; and (ii)
prior to the Conversion Date, Money Market Convertible Loans to the Borrower.
The Borrower shall not have the right to request the Banks to make offers to
make Money Market Revolving Credit Advances or Money Market Convertible Loans
at any time that the ratio of Consolidated Debt to Cash Flow (calculated as
provided in Section 5.13) is greater than or equal to 5.5 to 1.0. 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, provided that:
(i) there may be no more than 8 different Interest
Periods for both Syndicated Revolving Credit Advances and Money Market
Revolving Credit Advances outstanding at the same time (for which
purpose Interest Periods described in different numbered clauses of
the definition of the term "Interest Period" shall be deemed to be
different Interest Periods even if they are coterminous);
(ii) the aggregate principal amount of all Money Market
Revolving Credit Advances, together with the aggregate principal
amount of all Unmatured Prior Loans and Syndicated Revolving Credit
Advances, at any one time outstanding shall not exceed the aggregate
amount of the Revolving Credit Commitments of all of the Banks at such
time;
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(iii) there may be no more than 4 different Interest
Periods for both Syndicated Convertible Loans and Money Market
Convertible Loans outstanding at the same time (for which purpose
Interest Periods described in different numbered clauses of the
definition of the term "Interest Period" shall be deemed to be
different Interest Periods even if they are coterminous);
(iv) the aggregate principal amount of all Money Market
Convertible Loans, together with the aggregate principal amount of all
Syndicated Convertible Loans, at any one time outstanding shall not
exceed the aggregate amount of the Convertible Loan Commitments of all
of the Banks at such time; and
(v) there may be no more than a total of 8 different
Interest Periods for Syndicated Revolving Credit Advances, Money
Market Revolving Credit Advances, Syndicated Convertible Loans and
Money Market Convertible Loans outstanding at the same time (for which
purpose Interest Periods described in different numbered clauses of
the definition of the term "Interest Period" shall be deemed to be
different Interest Periods even if they are coterminous).
(b) When the Borrower wishes to request offers to make
Money Market Revolving Credit Advances or Money Market Convertible Loans, it
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 12:00 P.M. (Atlanta, Georgia time) one
Domestic Business Day prior to the date of the Money Market Revolving Credit
Borrowing or Money Market Convertible Loan Borrowing, as the case may be,
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 proposed date of such Money Market Revolving
Credit Borrowing or Money Market Convertible Loan Borrowing, as the
case may be, which shall be a Domestic Business Day (the "Quotation
Date");
(ii) the aggregate amount of such Money Market Revolving
Credit Borrowing or Money Market Convertible Loan Borrowing, as the
case may be, which shall be at least $5,000,000 (and in larger
multiples of $1,000,000) but shall not cause the limits specified in
Section 2.03(a) to be violated; and
(iii) the duration of the Interest Period applicable
thereto, which shall be 7 to 180 days.
The Borrower may request offers to make Money Market Loans for
up to three different Interest Periods in a single Money Market Quote Request;
provided that the request for each separate Interest Period shall be deemed to
be a separate Money Market Quote Request for a separate Money Market Revolving
Credit Borrowing or Money Market Convertible Loan Borrowing. Except as
otherwise provided in the immediately preceding sentence, the Borrower shall
not deliver a Money Market Quote Request more frequently than once every 5
Domestic Business Days.
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(c) (i) Each Bank may, but shall have no obligation to,
submit a Money Market Quote containing an offer to make Money Market
Revolving Credit Advances or Money Market Convertible Loans, in
response to any Money Market Quote Request; provided that, if the
Borrower's request under Section 2.03(b) specified more than one
Interest Period, such Bank may, but shall have no obligation to, make
a single submission containing a separate offer for each such Interest
Period 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 10:00 A.M. (Atlanta, Georgia time) on the
Quotation Date (or such other time and date as the Borrower and the
Agent, with the consent of the Required Banks, may agree); provided
that any Money Market Quote submitted by Wachovia Bank of North
Carolina, N.A. or Wachovia Bank of South Carolina, N.A. may be
submitted, and may only be submitted, if Wachovia Bank of North
Carolina, N.A. or Wachovia Bank of South Carolina, N.A., as the case
may be, notifies the Borrower of the terms of the offer contained
therein not later than 9:45 A.M. (Atlanta, Georgia time) on the
Quotation Date. Subject to Section 6.01, any Money Market Quote so
made shall be irrevocable absent manifest error except with the
written consent of the Agent given on the instructions of the
Borrower.
(ii) Each Money Market Quote shall be in substantially the
form of Exhibit I hereto and shall specify:
(A) the proposed date of the Money Market
Revolving Credit Borrowing or Money Market Convertible Loan
Borrowing, as the case may be, and the duration of the
Interest Period therefor, which shall be 7 to 180 days;
(B) the maximum principal amount of the Money
Market Revolving Credit Advance or Money Market Convertible
Loan which the quoting Bank is willing to make for the
applicable Interest Period, which principal amount (x) may be
greater than or less than the Revolving Credit Commitment or
Convertible Loan Commitment, as the case may be, of the
quoting Bank, (y) shall be at least $5,000,000 or a larger
multiple of $1,000,000, and (z) may not exceed the principal
amount of the Money Market Revolving Credit Borrowing or Money
Market Convertible Loan Borrowing, as the case may be, for
which offers were requested;
(C) the rate of interest per annum (rounded, if
necessary, to the nearest 1/100th of 1%) (the "Money Market
Rate") offered for each such Money Market Revolving Credit
Advance or Money Market Convertible Loan; and
(D) the identity of the quoting Bank.
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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 amount of the Money Market Revolving Credit Advance
or Money Market Convertible Loan, as the case may be, which the
quoting Bank is willing to make for the applicable Interest Period).
(d) The Agent shall as promptly as practicable after the
Money Market Quote is submitted (but in any event not later than 10:30 A.M.
(Atlanta, Georgia time) notify the 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 Borrower shall specify (A) the
maximum aggregate principal amount of the Money Market Revolving Credit
Borrowing or Money Market Convertible Loan Borrowing, as the case may be, for
which offers have been received and (B) the maximum principal amount and Money
Market Rates so offered by each Bank (identifying the Bank that made each Money
Market Quote).
(e) Not later than 11:00 A.M. (Atlanta, Georgia time) on
the Quotation Date (or such other time and date as the Borrower and the Agent,
with the consent of the Required Banks, may agree), the Borrower shall notify
the Agent of its acceptance or nonacceptance of the offers so notified to it
pursuant to Section 2.03(d) and the Agent shall promptly notify each Bank that
has submitted a Money Market Quote. In the case of acceptance, such notice
shall specify the aggregate principal amount of offers for each Interest Period
that are accepted. The Borrower may accept any Money Market Quote in whole or
in part (provided that any Money Market Quote accepted in part from any Bank
shall not be less than the amount set forth in the Money Market Quote of such
Bank as the minimum principal amount of the Money Market Revolving Credit
Advance or Money Market Convertible Loan, as the case may be, such Bank was
willing to make for the applicable Interest Period); provided that:
(i) the aggregate principal amount of each Money Market
Revolving Credit Borrowing or Money Market Convertible Loan Borrowing,
as the case may be, may not exceed the applicable amount set forth in
the related Money Market Quote Request;
(ii) the aggregate principal amount of each Money Market
Revolving Credit Borrowing or Money Market Convertible Loan Borrowing,
as the case may be, shall be at least $5,000,000 (and in larger
multiples of $1,000,000) but 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
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(iv) the 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 two 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 Interest Period, the principal amount of Money
Market Revolving Credit Advances or Money Market Convertible Loans, as the case
may be, in respect of which such offers are accepted shall be allocated by the
Borrower among such Banks as nearly as possible (in multiples of $100,000) in
proportion to the aggregate principal amount of such offers. Determinations by
the Borrower of the amounts of Money Market Revolving Credit Advances or Money
Market Convertible Loans, as the case may be, shall be conclusive in the
absence of manifest error.
(f) Any Bank whose offer to make any Money Market
Revolving Credit Advances or Money Market Convertible Loans, as the case may
be, has been accepted shall, not later than 12:00 P.M. (Atlanta, Georgia time)
on the Quotation Date, make the amount of such 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, in an account of the Borrower
maintained with Wachovia.
SECTION 2.04. Notes. (a)(i) The Syndicated Revolving Credit
Advances of each Bank shall be evidenced by a single Syndicated Revolving
Credit Note 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
Revolving Credit Commitment; and (ii) the Money Market Revolving Credit
Advances of each Bank shall be evidenced by a single Money Market Revolving
Credit Note payable to the order of such Bank for the account of its Lending
Office in an amount equal to the original principal amount of the aggregate of
the Banks' Revolving Credit Commitments.
(b) The Term Loan of each Bank shall be evidenced by a
single Term Loan Note 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 Term Loan Commitment.
(c)(i) The Syndicated Convertible Loans of each Bank shall
be evidenced by a single Syndicated Convertible Loan Note 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 Convertible Loan Commitment; and (ii)
the Money Market Convertible Loans of each Bank shall be evidenced by a single
Money Market Convertible Loan Note payable to the order of such Bank for the
account of its Lending Office in an amount equal to the original principal
amount of the aggregate of the Banks' Convertible Loan Commitments.
(d) 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 schedule forming a
part thereof appropriate notations to evidence, the date, amount and maturity
of, and effective interest rate for, each Revolving Credit Advance,
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<PAGE> 35
Term Loan or Convertible Loan, as the case may be, made by it, the date and
amount of each payment of principal made by the Borrower with respect thereto
and in the case of Syndicated Revolving Credit Advances, Term Loans or
Syndicated Convertible Loans, as the case may be, whether such Loan is a Base
Rate Loan or Euro-Dollar Loan, and such schedule shall constitute rebuttable
presumptive evidence of the principal amount owing and unpaid on such Bank's
Notes; provided that the failure of any Bank to make, or any error in making,
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.
SECTION 2.05. Maturity of Revolving Credit Advances, Term
Loans and Convertible Loans.
(a) Revolving Credit Advances. (i) Each Revolving Credit
Advance included in any Revolving Credit Borrowing shall mature, and the
principal amount thereof shall be due and payable, on the first to occur of:
(A) the last day of the Interest Period applicable to such Revolving Credit
Borrowing; or (B) the Revolving Credit Maturity Date; provided, however, that
the aggregate outstanding principal amount of all Syndicated Revolving Credit
Advances, together with all Money Market Revolving Credit Advances at any one
time outstanding shall not exceed the aggregate amount of the Revolving Credit
Commitments of all of the Banks at such time.
(ii) Upon written request of the Borrower, which shall be
made in writing and delivered to the Agent on a Domestic Business Day no more
than 90 and no fewer than 60 days prior to the First Anniversary Date or no
more than 90 and no fewer than 60 days prior to the Second Anniversary Date,
the Banks and the Agent in their sole and absolute discretion may (but shall
not be obligated to) extend the then effective Revolving Credit Maturity Date
for a period of one year. The Revolving Credit Maturity Date may be extended
on either the First Anniversary Date or the Second Anniversary Date or on both
the First Anniversary Date and the Second Anniversary Date for a maximum total
extension of two years. The terms of any extension of the Revolving Credit
Maturity Date shall be independently negotiated among the Borrower, the Banks
and the Agent at the time of the extension request, provided that the terms of
the extension may be the same as those in effect prior to any extension should
the Borrower, the Banks and the Agent so agree; provided, further, that should
the terms of the extension be other than those in effect prior to the
extension, then the Loan Documents shall be amended to the extent necessary to
incorporate any such different terms. In the event that a Bank chooses to
extend the Revolving Credit Maturity Date for such one year period, notice
shall be given by such Bank to the Borrower and the Agent not more than 30, nor
fewer than 15, days prior to the then relevant Anniversary Date; provided that
the Revolving Credit Maturity Date shall not be extended with respect to any of
the Banks (regardless of whether any relevant Bank has delivered a favorable
extension notice) unless the Required Banks have delivered favorable extension
notices and are willing to extend the Revolving Credit Maturity Date and either
(i) the remaining Banks shall on the Revolving Credit Maturity Date (prior to
its extension hereunder) purchase ratable assignments (without any obligations
so to do) from each Bank (a "Terminating Revolver Bank") that has not elected
to extend the Revolving Credit Maturity Date (or that has failed to provide the
Agent and Borrower a favorable extension notice) (in the form of an
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<PAGE> 36
Assignment and Acceptance) in accordance with their respective percentage of
the remaining aggregate amount of the Revolving Credit Commitments; provided
that such remaining Banks shall be provided such opportunity (which opportunity
shall allow such Banks at least five Domestic Business Days in which to make a
decision) prior to the Borrower finding another bank pursuant to the
immediately succeeding clause (ii); and provided, further, that should any of
the remaining Banks elect not to purchase such an assignment, then such other
remaining Banks shall be entitled to purchase an assignment on the Revolving
Credit Maturity Date (prior to its extension hereunder) from any Terminating
Revolver Bank which includes the ratable interest that was otherwise available
to such non-purchasing remaining Bank or Banks, as the case may be; (ii) the
Borrower shall find another bank, acceptable to the Agent, willing to accept an
assignment on the Revolving Credit Maturity Date (prior to its extension
hereunder) from such Terminating Revolver Bank (in the form of an Assignment
and Acceptance); or (iii) the Borrower shall reduce the Revolving Credit
Commitments on the Revolving Credit Maturity Date (prior to its extension
hereunder) in an amount equal to the sum of the Revolving Credit Commitments of
all such Terminating Revolver Banks which are not assigned pursuant to clause
(i) or (ii) above.
(b) Term Loans. Each Term Loan included in any Term Loan
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the first to occur of: (i) the last day of the Interest Period
applicable to such Term Loan Borrowing; or (ii) the Term Loan Maturity Date;
provided, however, that the aggregate outstanding principal amount of all Term
Loans at any one time outstanding shall not exceed the aggregate amount of the
Term Loan Commitments of all of the Banks at such time.
(c) Convertible Loans. (i) Each Convertible Loan
included in any Convertible Loan Borrowing shall mature, and the principal
amount thereof shall be due and payable, on the first to occur of: (A) the
last day of the Interest Period applicable to such Convertible Loan Borrowing;
or (B) the Convertible Loan Maturity Date; provided, however, that the
aggregate outstanding principal amount of all Syndicated Convertible Loans,
together with all Money Market Convertible Loans, at any one time outstanding
shall not exceed the aggregate amount of the Convertible Loan Commitments of
all the Banks at such time.
(ii) Upon written request of the Borrower, which shall be
made in writing and delivered to the Agent on a Domestic Business Day no more
than 90 and no fewer than 60 days prior to the First Anniversary Date or no
more than 90 and no fewer than 60 days prior to the Second Anniversary Date,
the Banks and the Agent in their sole and absolute discretion may (but shall
not be obligated to) extend the then effective Convertible Loan Maturity Date
for a period of one year. The Convertible Loan Maturity Date may be extended
on either the First Anniversary Date or the Second Anniversary Date or on both
the First Amendment Date and the Second Anniversary Date for a maximum total
extension of two years. The terms of any extension of the Convertible Loan
Maturity Date shall be independently negotiated among the Borrower, the Banks
and the Agent at the time of the extension request, provided that the terms of
the extension may be the same as those in effect prior to any extension should
the Borrower, the Banks and the Agent so agree; provided, further, that should
the terms of the extension be other than those in effect prior to the
extension, then the Loan Documents shall be amended to the extent necessary to
incorporate any such different terms. In the event that a Bank chooses to
extend the Convertible Loan Maturity Date for such one year period, notice
shall be
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<PAGE> 37
given by such Bank to the Borrower and the Agent not more than 30, nor fewer
than 15, days prior to the then relevant Anniversary Date; provided that the
Convertible Loan Maturity Date shall not be extended with respect to any of the
Banks (regardless of whether any relevant Bank has delivered a favorable
extension notice) unless the Required Banks have delivered favorable extension
notices and are willing to extend the Convertible Loan Maturity Date and either
(i) the remaining Banks shall on the Convertible Loan Maturity Date (prior to
its extension hereunder) purchase ratable assignments (without any obligations
so to do) from each Bank (a "Terminating Convertible Bank") that has not
elected to extend the Convertible Loan Maturity Date (or that has failed to
provide the Agent and Borrower a favorable extension notice) (in the form of an
Assignment and Acceptance) in accordance with their respective percentage of
the remaining aggregate amount of the Convertible Loan Commitments; provided
that such remaining Banks shall be provided such opportunity (which opportunity
shall allow such Banks at least five Domestic Business Days in which to make a
decision) prior to the Borrower finding another bank pursuant to the
immediately succeeding clause (ii); and provided, further, that should any of
the remaining Banks elect not to purchase such an assignment, then such other
remaining Banks shall be entitled to purchase an assignment on the Convertible
Loan Maturity Date (prior to its extension hereunder) from any Terminating
Convertible Bank which includes the ratable interest that was otherwise
available to such non-purchasing remaining Bank or Banks, as the case may be;
(ii) the Borrower shall find another bank, acceptable to the Agent, willing to
accept an assignment on the Convertible Loan Maturity Date (prior to its
extension hereunder) from such Terminating Convertible Bank (in the form of an
Assignment and Acceptance); or (iii) the Borrower shall reduce the Convertible
Loan Commitments on the Convertible Loan Maturity Date (prior to its extension
hereunder) in an amount equal to the sum of the Convertible Loan Commitments of
all such Terminating Convertible Banks which are not assigned pursuant to
clause (i) or (ii) above. In the event that the Borrower requests an extension
of the Convertible Loan Maturity Date pursuant to this Section 2.05(c)(ii) no
more than 90 days prior to the Second Anniversary Date nor fewer than 60 days
prior to the Second Anniversary Date, the Borrower's right to deliver a
Conversion Notice shall terminate.
SECTION 2.06. Interest Rates. (a) "Applicable Margin" shall
be determined quarterly based upon the ratio of Consolidated Debt to Cash Flow
(calculated as provided in Section 5.13), as set forth on Schedule 2.06.
Each of the Applicable Margins for the Term Loans during periods in which they
bear interest calculated by reference to the Adjusted London Interbank offered
Rate Loans shall be increased by 1/8% on the day after the second Anniversary
Date. The Applicable Margin shall be determined effective as of the date
(herein, the "Rate Determination Date") which is 60 days after the last day of
the Fiscal Quarter as of the end of which the foregoing ratio is being
determined, based on the quarterly financial statements for such Fiscal
Quarter, and the Applicable Margin so determined shall remain effective from
such Rate Determination Date until the date which is 60 days after the last day
of the Fiscal Quarter in which such Rate Determination Date falls (which latter
date shall be a new Rate Determination Date); provided that (i) for the period
from and including the Closing Date to but excluding the Rate Determination
Date next following the Closing Date, the Applicable Margin shall be (A) 0.0%
for Base Rate Loans, (B) .50% for Term Loans which are Euro-Dollar Loans and
Convertible Loans which are Euro-Dollar Loans on and after the Conversion Date;
and (C) .35% for Revolving Credit Advances which are Euro-
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<PAGE> 38
Dollar Loans and Convertible Loans which are Euro-Dollar Loans prior to the
Conversion Date, (ii) in the case of an Applicable Margin determined from the
Borrower-prepared quarterly financial statements for the fourth and final
Fiscal Quarter of a Fiscal Year, in the event that the annual audited
statements for such Fiscal Year subsequently provided to the Banks indicate
that the Applicable Margin originally determined to be effective on the Rate
Determination Date immediately following the end of such Fiscal Quarter was
inappropriate in light of such annual audited financial statements, then the
Applicable Margin shall be adjusted retroactively to such Rate Determination
Date to reflect the proper Applicable Margin, and (iii) if on any Rate
Determination Date the Borrower shall have failed to deliver to the Banks the
financial statements required to be delivered pursuant to Section 5.01(b) with
respect to the Fiscal Quarter most recently ended prior to such Rate
Determination Date, then for the period beginning on such Rate Determination
Date and ending on the earlier of (A) the date on which the Borrower shall
deliver to the Banks the financial statements to be delivered pursuant to
Section 5.01(b) with respect to such Fiscal Quarter or any subsequent Fiscal
Quarter, and (B) the date on which the Borrower shall deliver to the Banks
annual financial statements required to be delivered pursuant to Section
5.01(a) with respect to the Fiscal Year which includes such Fiscal Quarter or
any subsequent Fiscal Year, the Applicable Margin shall be determined as if the
ratio of Consolidated Debt to Cash Flow was more than 5.5 to 1.0 at all times
during such period. Any change in the Applicable Margin on any Rate
Determination Date shall result in a corresponding change, effective on and as
of such Rate Determination Date, in the interest rates applicable to each Term
Loan, Syndicated Revolving Credit Advance and Syndicated Convertible Loan
outstanding on such Rate Determination Date.
(b) For each day during each Interest Period in which the
Term Loans, Convertible Loans or any Revolving Credit Advance is a Base Rate
Loan, the applicable Term Loan, Convertible Loan and Revolving Credit Advance
shall bear interest on the outstanding principal amount thereof, at a rate per
annum equal to the sum of 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 may, at the election of
the Required Banks, bear interest, payable on demand, for each day until paid
at a rate per annum equal to the Default Rate.
(c) For each day during each Interest Period in which the
Term Loans, Convertible Loans or any Revolving Credit Advance is a Euro-Dollar
Loan the applicable Term Loan, Convertible Loan and Revolving Credit Advance
shall bear interest on the outstanding principal amount thereof, 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; provided that if any
Euro-Dollar Loan shall, as a result of clause (1)(c) of the definition of
Interest Period, have an Interest Period of less than one month, such
Euro-Dollar Loan shall bear interest during such Interest Period at the rate
applicable to Base Rate Loans during such period. Such interest shall be
payable for each Interest Period on the last day thereof and, if such Interest
Period is longer than three (3) months, at intervals of three months after the
first day thereof. Any overdue principal of and, to the extent permitted by
applicable 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.
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<PAGE> 39
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained (rounded
upward, 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 approximately
11:00 a.m., London time, two (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, 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; and (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, 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 the Euro-Dollar Borrowing of which such Euro-Dollar Loan is a part.
"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 a member bank of
the Federal Reserve System 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) At all times after the Conversion Date, the
Convertible Loans shall at all times be either Euro-Dollar Loans or Base Rate
Loans and bear interest as provided in this Section, provided further that: (i)
at any time prior to or on the Conversion Date, there may be in effect only four
(4) different Interest Periods applicable to the Convertible Loans; (ii) at any
time after the Conversion Date, there may be in effect only one (1) Interest
Period applicable to the Convertible Loans; and (iii) at any time there may be
in effect only one (1) Interest Period applicable to the Term Loans; (iv) at any
time prior to or on the Conversion Date, there may be in effect only eight (8)
different Interest Periods applicable to the Convertible Loans and the Revolving
Credit Advances; and (v) at any time after the Conversion Date, there may be in
effect only nine (9) Interest Periods applicable to the Convertible Loans and
the Revolving Credit Advances.
(e) Each Money Market Convertible Loan and each Money
Market Revolving Credit Advance shall bear interest on the outstanding principal
amount thereof, for the Interest Period applicable thereto, at a rate per annum
equal to the Money Market Rate for such Loan
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<PAGE> 40
quoted by the Bank making such Loan in accordance with Section 2.03. Such
interest shall be payable for such Interest Period on the last day thereof and,
if such Interest Period is longer than 90 days, 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 Convertible Loan and any Money
Market Revolving Credit Advance shall bear interest, payable on demand, for
each day until paid at a rate per annum equal to the Default Rate.
(f) The Agent shall determine each interest rate
applicable to the Term Loans, Convertible Loans and Revolving Credit Advances
hereunder (other than interest rates applicable to Money Market Revolving
Credit Advances or Money Market Convertible Loans). The Agent shall give
prompt notice to the Borrower and the Banks by telecopy of each rate of
interest so determined, and its determination thereof shall be conclusive in
the absence of manifest error.
(g) After the occurrence and during the continuance of a
Default, the principal amount of the Term Loans, Convertible Loans and
Revolving Credit Advances (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. The Term Loans, Convertible Loans and Revolving
Credit Advances shall bear interest at a rate per annum equal to the Default
Rate following any judgment in favor of the Banks on the Notes.
(h) Notwithstanding anything to the contrary contained
herein, (i) there shall not be more than nine (9), at any time prior to or on
the Conversion Date, or ten (10), at anytime after the Conversion Date,
different Interest Periods applicable to the Term Loans, Convertible Loans and
Revolving Credit Advances outstanding at the same time (for which purpose
Interest Periods described in different numbered clauses of the definition of
the term "Interest Period" shall be deemed to be different Interest Periods
even if they are coterminous) and (ii) the proceeds of any Base Rate Borrowing
shall be applied first to repay the unpaid principal amount of all Revolving
Credit Advances made as Base Rate Loans (if any) outstanding immediately before
such Base Rate Borrowing.
(i) Notwithstanding anything herein to the contrary, if
one or more Term Loan Commitment Reduction Dates are scheduled to occur during
an Interest Period in which the Term Loans are Euro-Dollar Loans other than on
the last day of such Interest Period, then during such Interest Period a
portion of the outstanding balance of the Term Loans which is equal to the
aggregate amount of the principal payment due on the Term Loans on such Term
Loan Commitment Reduction Dates shall be Base Rate Loans, and only the
remaining portion of the outstanding principal of the Term Loans shall
constitute Euro-Dollar Loans. Notwithstanding anything herein to the contrary,
if one or more Convertible Loan Commitment Reduction Dates are scheduled to
occur during an Interest Period in which the Convertible Loans are Euro-Dollar
Loans other than on the last day of such Interest Period, then during such
Interest Period a portion of the outstanding balance of the Convertible Loans
equal to the aggregate amount of the principal payment due on the Convertible
Loans on such Convertible Loan Commitment Reduction Date shall be Base Rate
Loans, and only the remaining portion of the outstanding principal of the
Convertible Loans shall constitute Euro-Dollar Loans.
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<PAGE> 41
SECTION 2.07. Fees. (a) The Borrower shall pay to the Agent
for the ratable account of each Bank a facility fee equal to the product of:
(i) the aggregate of the daily average amounts of such Bank's Revolving Credit
Commitment and Convertible Loan Commitment (irrespective of usage), times (ii)
a per annum percentage equal to the Applicable Facility Fee Rate from and
including the Closing Date to and including the later of: (i) the Revolving
Credit Maturity Date; and (ii) the Convertible Loan Maturity Date. Facility
fees shall be payable quarterly in arrears on the fifteenth day following each
Facility Fee Determination Date and on the later of: (i) the Revolving Credit
Maturity Date; or (ii) the Convertible Loan Maturity Date; provided, that
should the Convertible Loan Commitments and the Revolving Credit Commitments be
terminated at any time for any reason, the entire accrued and unpaid facility
fee shall be paid on the date of such termination. The "Applicable Facility
Fee Rate" shall be determined quarterly based upon the ratio of Consolidated
Debt to Cash Flow (calculated as provided in Section 5.13) as follows:
<TABLE>
<CAPTION>
Ratio of Applicable
Consolidated Facility
Debt to Cash Flow Fee Rate
----------------- ----------
<S> <C>
Greater than or equal to 5.5 to 1.0 + .300%
Equal to or greater than 4.75 to 1.0
but less than 5.5 to 1.0 + .250%
Equal to or greater than 3.75 to 1.0
but less than 4.75 to 1.0 + .200%
Equal to or greater than 3.25 to 1.0
but less than 3.75 to 1.0 + .175%
Less than 3.25 to 1.0 + .150%
</TABLE>
The Applicable Facility Fee Rate shall be determined effective as of the date
(herein, the "Facility Fee Determination Date") which is 60 days after the last
day of the Fiscal Quarter as of the end of which the foregoing ratio is being
determined, based on the quarterly financial statements for such Fiscal
Quarter, and the Applicable Facility Fee Rate so determined shall remain
effective from such Facility Fee Determination Date until the date which is 60
days after the last day of the Fiscal Quarter in which such Facility Fee
Determination Date falls (which latter date shall be a new Facility Fee
Determination Date); provided that (i) for the period from and including the
Closing Date to but excluding the Facility Fee Determination Date next
following the Closing Date, the Applicable Facility Fee Rate shall be 0.15%
(15/100%); (ii) in the case of an Applicable Facility Fee Rate determined from
the Borrower-prepared quarterly financial statements for the fourth and final
Fiscal Quarter of a Fiscal Year, in the event that the annual audited
statements for such Fiscal Year subsequently provided to the Banks indicate
that the Applicable Facility Fee Rate originally determined to be effective on
the Facility Fee Determination Date immediately following the end of such
Fiscal Quarter was inappropriate in light of such annual audited financial
statements, then the Applicable Facility Fee Rate shall be adjusted
retroactively to such Facility Fee Determination Date to reflect the proper
Applicable Facility Fee Rate, and (iii) if on any Facility Fee Determination
Date the Borrower shall have
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<PAGE> 42
failed to deliver to the Banks the financial statements required to be
delivered pursuant to Section 5.01(b) with respect to the Fiscal Quarter most
recently ended prior to such Facility Fee Determination Date, then for the
period beginning on such Facility Fee Determination Date and ending on the
earlier of (A) the date on which the Borrower shall deliver to the Banks the
financial statements to be delivered pursuant to Section 5.01(b) with respect
to such Fiscal Quarter or any subsequent Fiscal Quarter, and (B) the date on
which the Borrower shall deliver to the Banks annual financial statements
required to be delivered pursuant to Section 5.01(a) with respect to the Fiscal
Year which includes such Fiscal Quarter or any subsequent Fiscal Year, the
Applicable Facility Fee Rate shall be determined as if the ratio of
Consolidated Debt to Cash Flow was more than 5.5 to 1.0 at all times during
such period.
(b) The Borrower shall also pay to the Agent for the
ratable account of each Bank a conversion rights fee on the aggregate of the
daily average amounts of such Bank's Convertible Loan Commitment, for the
period from and including the Closing Date to and including the first to occur
of: (i) the Conversion Date; or (ii) the Second Anniversary Date, at a rate
equal to .025% per annum. Conversion rights fees shall be payable quarterly in
arrears on the fifteenth day following each Facility Fee Determination Date and
on the first to occur of: (i) the Conversion Date; or (ii) the Second
Anniversary Date; provided, that should the Convertible Loan Commitments be
terminated at any time for any reason, the entire accrued and unpaid conversion
rights fee shall be paid on the date of such termination.
(c) The Borrower shall pay to each Bank on the Closing
Date a fee in an amount equal to .05% multiplied by the aggregate amount of
such Bank's Revolving Credit Commitment, Term Loan Commitment and Convertible
Loan Commitment.
(d) 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 Revolving
Credit Commitments, Convertible Loan Commitments and Term Loan Commitments.
(a) The Borrower may, upon at least 3 Domestic Business Days'
notice to the Agent, terminate at any time, or proportionately reduce from time
to time by an aggregate amount of at least $10,000,000 or any larger multiple
of $1,000,000 the Revolving Credit Commitments or the Convertible Loan
Commitments. If the Revolving Credit Commitments are terminated in their
entirety, all accrued fees (as provided under Section 2.07) which are
applicable to the Revolving Credit Commitments shall be payable on the
effective date of such termination. If the Convertible Loan Commitments are
terminated in their entirety, all accrued fees (as provided under Section 2.07)
which are applicable to the Convertible Loan Commitments shall be payable on
the effective date of such termination. A notice of reduction or termination
of the Revolving Credit Commitments or Convertible Loan Commitments hereunder,
once given, shall not thereafter be revocable by the Borrower.
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<PAGE> 43
(b) The Borrower may, upon at least 3 Domestic Business Days'
notice to the Agent, terminate at any time, or proportionately reduce from time
to time by an aggregate amount of at least $10,000,000 or any larger multiple
of $1,000,000 the Term Loan Commitments. A notice of reduction or termination
of the Term Loan Commitments hereunder, once given, shall not thereafter be
revocable by the Borrower.
SECTION 2.09. Mandatory Reduction and Termination of
Commitments.
(a) Revolving Credit Commitments. The Revolving Credit
Commitments shall terminate on the Revolving Credit Maturity Date and any
Revolving Credit Advance then outstanding (together with accrued interest
thereon) shall be due and payable on such date.
(b) Term Loan Commitments. (1) The Term Loan Commitments
shall terminate on the Term Loan Maturity Date and any Term Loans then
outstanding (together with accrued interest thereon) shall be due and payable
on such date.
(2) The aggregate amount of the Term Loan Commitments
shall be reduced in twenty (20) consecutive quarterly installments in the
amount of $5,000,000 each on each Term Loan Commitment Reduction Date.
(3) If the Borrower shall repay or prepay any Term Loans
other than with the proceeds of a new Term Loan Borrowing under the Term Loan
Commitments then there shall be a mandatory reduction of the Term Loan
Commitments to an amount equal to the aggregate principal amount of all Term
Loans then outstanding (after giving effect to such repayment or prepayment).
(4) The aggregate amount of the Term Loan Commitments
shall be automatically reduced on the Domestic Business Day which is three (3)
Domestic Business Days following the last day of each Fiscal Quarter, in an
amount equal to the sum of: (i) fifty percent (50%) of the Net Proceeds of Debt
received by the Borrower during such Fiscal Quarter, plus (ii) fifty percent
(50%) of the Net Proceeds of Preferred Stock received by the Borrower during
such Fiscal Quarter.
(5) Each reduction of the Term Loan Commitments shall be
applied to reduce the Term Loan Commitments of the several Banks ratably. No
optional reduction of the Term Loan Commitments pursuant to Section 2.08 or
otherwise shall reduce the amount of any subsequent mandatory reduction
pursuant to this Section 2.09 (b) and no mandatory reduction of the Term Loan
Commitments pursuant to any paragraph of this Section 2.09 (b) shall reduce the
amount of any subsequent mandatory reduction of the Term Loan Commitments
pursuant to such paragraph or any other paragraph of this Section 2.09 (b).
(c) Convertible Loan Commitments. (1) The Convertible
Loan Commitments shall terminate on the Convertible Loan Maturity Date and any
Convertible Loans then outstanding (together with accrued interest thereon)
shall be due and payable on such date.
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(2) If the Borrower delivers to the Agent a Conversion
Notice pursuant to Section 2.14, and on the Conversion Date the Convertible
Loan Commitments shall not have been reduced to a lesser amount pursuant to
Section 2.08 hereof, then on the Conversion Date there shall be a mandatory
reduction of the Convertible Loan Commitments to an amount equal to the
aggregate principal amount of all Convertible Loans outstanding on the
Conversion Date.
(3) If the Borrower delivers to the Agent a Conversion
Notice pursuant to Section 2.14, then after the Conversion Date, the aggregate
amount of the Convertible Loan Commitments shall be reduced on each Convertible
Loan Commitment Reduction Date in twenty (20) consecutive quarterly
installments, each in an amount equal to the quotient determined by dividing
(i) the aggregate Convertible Loan Commitment on the Conversion Date, after
giving effect to any reductions pursuant to Section 2.09 (c)(2), by (ii) twenty
(20).
(4) If the Borrower delivers to the Agent a Conversion
Notice pursuant to Section 2.14, then on and at all times after the Conversion
Date, if the Borrower shall repay or prepay any Convertible Loans other than
with the proceeds of a new Convertible Loan under the Convertible Loan
Commitments then there shall be a mandatory reduction of the Convertible Loan
Commitments to an amount equal to the aggregate principal amount of all
Convertible Loans then outstanding (after giving effect to such repayment or
prepayment).
(5) Each reduction of the Convertible Loan Commitments
shall be applied to reduce the Convertible Loan Commitments of the several
Banks ratably. No optional reduction of the Convertible Loan Commitments
pursuant to Section 2.08 or otherwise shall reduce the amount of any subsequent
mandatory reduction pursuant to this Section 2.09 (c) and no mandatory
reduction of the Convertible Loan Commitments pursuant to any paragraph of this
Section 2.09 (c) shall reduce the amount of any subsequent mandatory reduction
of the Convertible Loan Commitments pursuant to such paragraph or any other
paragraph of this Section 2.09 (c).
SECTION 2.10. Optional Prepayments of Revolving Credit
Advances, Term Loans and Convertible Loans. (a) The Borrower may, upon
at least 1 Domestic Business Day's notice to the Agent, prepay any Revolving
Credit Advance, Convertible Loan or Term Loan that is a Base Rate Loan in whole
at any time, or from time to time in part in amounts aggregating at least
$10,000,000 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 Revolving Credit Advances, Term Loans or Convertible Loans, as the case may
be, of the several Banks; provided that such prepayment shall be applied,
first, to Revolving Credit Advances outstanding on the date of such prepayment
(in direct order of maturity) and then, to the extent necessary, to the
Convertible Loans outstanding on the date of such prepayment (in the inverse
order of maturity) and then, to the extent necessary, to the Term Loans
outstanding on the date of such prepayment (in the inverse order of maturity).
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(b) Except as provided in Section 8.02, the Borrower may
not prepay all or any portion of the principal amount of any Euro-Dollar Loan
or any Money Market Convertible Loan or any Money Market Revolving Credit
Advance, except on the last day of the applicable Interest Period.
(c) Upon receipt of a notice of prepayment pursuant to
this Section, the Agent shall promptly notify each Bank of the contents thereof
and of such Bank's ratable share of such prepayment and such notice shall not
thereafter be revocable by the Borrower.
SECTION 2.11. Mandatory Prepayments. (a) On each date on
which the Revolving Credit Commitments are reduced pursuant to Section 2.08 or
Section 2.09, the Borrower shall repay or prepay such principal amount of the
outstanding Revolving Credit Advances, if any (together with interest accrued
thereon and any amounts due under Section 8.05(a)), as may be necessary so that
after such payment the aggregate unpaid principal amount of the Revolving
Credit Advances does not exceed the aggregate amount of the Revolving Credit
Commitments as then reduced. Each such payment or prepayment shall be applied
to repay or prepay ratably the Revolving Credit Advances of the several Banks;
provided, that such prepayment shall be applied, first to Syndicated Revolving
Credit Advances outstanding on the date of such prepayment (in direct order of
maturity) and then to the extent necessary, to Money Market Revolving Credit
Advances outstanding on the date of such prepayment (in direct order of
maturity).
(b) In the event that the aggregate principal amount of
all Revolving Credit Advances at any one time outstanding shall at any time
exceed the aggregate amount of the Revolving Credit Commitments of all of the
Banks at such time, the Borrower shall immediately repay (in the inverse order
of maturity) so much of the Revolving Credit Advances as is necessary in order
that the aggregate principal amount of the Revolving Credit Advances thereafter
outstanding shall not exceed the aggregate amount of the Revolving Credit
Commitments of all of the Banks at such time.
(c) On each date on which the Term Loan Commitments are
reduced pursuant to Section 2.08 or Section 2.09, the Borrower shall repay or
prepay such principal amount of the outstanding Term Loans, if any (together
with interest accrued thereon and any amounts due under Section 8.05(a)), as
may be necessary so that after such payment the aggregate unpaid principal
amount of the Term Loans does not exceed the aggregate amount of the Term Loan
Commitments as then reduced. Each such payment or prepayment shall be applied
to repay or prepay ratably the Term Loans of the several Banks.
(d) On each date on which the Convertible Loan
Commitments are reduced pursuant to Section 2.08 or Section 2.09, the Borrower
shall repay or prepay (in the inverse order of maturity) such principal amount
of the outstanding Convertible Loans, if any (together with interest accrued
thereon and any amounts due under Section 8.05(a)), as may be necessary so that
after such payment the aggregate unpaid principal amount of the Convertible
Loans does not exceed the aggregate amount of the Convertible Loan Commitments
as then reduced. Each such payment or prepayment shall be applied to repay or
prepay ratably the Convertible Loans
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of the several Banks; provided, that, if such reduction occurs prior to the
Conversion Date, such prepayment be applied, first to Syndicated Convertible
Loans outstanding on the date of such prepayment (in direct order of maturity)
and then, to the extent necessary, to Money Market Convertible Loans
outstanding on the date of such prepayment (in direct order of maturity).
SECTION 2.12. General Provisions as to Payments. (a) The
Borrower shall make each payment of principal of, and interest on, the
Convertible Loans, Term Loans and Revolving Credit Advances and of conversion
rights fees and facility fees hereunder, not later than 11:00 A.M. (Atlanta,
Georgia time) on the date when due, in Federal or other funds immediately
available in Atlanta, Georgia, to the Agent at its address referred to in
Section 9.01. The Agent will promptly distribute 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 Base Rate Loans, the Money Market Revolving Credit Advances, the Money
Market Convertible Loans or of fees 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 shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time.
(c) All payments of principal, interest and fees and all
other amounts to be made by the Borrower pursuant to this Agreement with
respect to any Convertible Loan, Term Loan or Revolving Credit Advance 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 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 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 (all such
non-excluded taxes, imposts, levies, duties, deductions or withholdings of any
nature being "Taxes"). In the event that the Borrower is required by
applicable law to make any such withholding or deduction of Taxes with respect
to any Convertible Loan, Term Loan or Revolving Credit Advance or fee or other
amount, the 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 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 of any Convertible Loan, Term Loan or Revolving
Credit Advance or fee relating thereto, the Borrower shall furnish any Bank, at
such Bank's request, a certificate from
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each applicable taxing authority or an opinion of counsel 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 Borrower fails to provide such
original or certified copy of a receipt evidencing payment of Taxes or
certificate(s) or opinion of counsel of exemption, the Borrower hereby agrees
to compensate such Bank for, and indemnify them with respect to, the tax
consequences of the Borrower's failure to provide evidence of tax payments or
tax exemption.
In the event any Bank receives a refund of any Taxes paid by
the Borrower pursuant to this Section 2.12, it will pay to the Borrower the
amount of such refund promptly upon receipt thereof; provided, however, if at
any time thereafter it is required to return such refund, the Borrower shall
promptly repay to it the amount of such refund.
Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 2.12 shall (i) 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) 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 days and paid
for the actual number of days elapsed (including the first day but excluding
the last day). Interest on Euro-Dollar Loans, interest on Money Market
Convertible Loans and interest on Money Market Revolving Credit Advances shall
be computed on the basis of a year of 360 days 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. Conversion rights
fees, 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 Conversion. Provided that the Borrower has not
requested an extension of the Convertible Loan Maturity Date pursuant to
Section 2.05(c)(ii) no more than 90 days and no fewer than 60 days prior to the
Second Anniversary Date, the Borrower may, at any time prior to or on the third
Business Day prior to the Second Anniversary Date, deliver to the Agent a
written notice (the "Conversion Notice") which shall set forth the Conversion
Date which date shall be: (i) not more than 30 days nor less than 3 days from
the date such Conversion Notice is received by the Agent; (ii) the last day of
the Interest Periods applicable to the outstanding Convertible Loans; and (iii)
on or before the Second Anniversary Date. Once delivered to the Agent, the
Conversion Notice shall be irrevocable and shall terminate the Borrower's
rights under Section 2.05(c)(ii). If the Borrower delivers to the Agent the
Conversion Notice, prior to or on the Second Anniversary Date, then effective
on the Conversion Date, the Convertible Loan Maturity Date shall be extended to
March 1, 2002.
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ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to First Borrowing. The obligation
of each Bank to make any Loan on the occasion of the first Borrowing is subject
to the satisfaction of the conditions set forth in Section 3.02 and the
following additional conditions:
(a) receipt by the Agent from each of the parties hereto
of either (i) a duly executed counterpart of this Agreement signed by
such party or (ii) a telex or facsimile transmission stating that such
party has duly executed a counterpart of this Agreement and sent such
counterpart to the Agent;
(b) receipt by the Agent of the duly executed Notes for
the account of each Bank complying with the provisions of Section
2.04;
(c) receipt by the Agent of an opinion (together with any
opinions of local counsel relied on therein) of Martha G. Williams,
General Counsel of the Borrower, substantially in the form of Exhibit
B hereto and covering such additional matters relating to the
transactions contemplated hereby as any Bank may reasonably request;
(d) receipt by the Agent of an opinion of Womble Carlyle
Sandridge & Rice, PLLC, special counsel for the Agent, substantially
in the form of Exhibit C hereto and covering such additional matters
relating to the transactions contemplated hereby as the Agent may
reasonably request;
(e) receipt by the Agent of a certificate, dated the date
of the first Borrowing, substantially in the form of Exhibit D hereto,
signed by a principal financial officer of the Borrower, to the effect
that (i) no Default has occurred and is continuing on the date of the
first Borrowing; and (ii) the representations and warranties of the
Borrower contained in Article IV hereof are true on and as of the date
of the first Borrowing hereunder;
(f) receipt by the Agent of all documents which the Agent
may reasonably request relating to the existence of the Borrower, the
corporate authority for and the validity of this Agreement and the
Notes, and any other matters relevant hereto, all in form and
substance satisfactory to the Agent, including without limitation a
certificate of incumbency of the Borrower, signed by the Secretary or
an Assistant Secretary of the Borrower, substantially in the form of
Exhibit E hereto, 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) the Borrower's Certificate of Incorporation,
(ii) the Borrower's Bylaws, (iii) a certificate of the Secretary of
State of the State of South Carolina as to the
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existence of the Borrower as a South Carolina corporation, and (iv)
the action taken by the Board of Directors of the Borrower authorizing
the Borrower's execution, delivery and performance of this Agreement,
the Notes and the other Loan Documents to which the Borrower is a
party.
SECTION 3.02. Conditions to All Borrowings. The obligation
of each Bank to make a Loan on the occasion of each Revolving Credit Borrowing,
Term Loan Borrowing or Convertible Loan Borrowing is subject to the
satisfaction of the following conditions:
(a) receipt by the Agent of notice of such Syndicated
Revolving Credit Borrowing, Term Loan Borrowing or Syndicated
Convertible Loan Borrowing, as the case may be, as required by Section
2.02 or compliance with the provisions of Section 2.03 in the case of
a Money Market Revolving Credit Borrowing or a Money Market
Convertible Loan Borrowing;
(b) the fact that, immediately before and after such
Revolving Credit Borrowing, Term Loan Borrowing or Convertible Loan
Borrowing, as the case may be, no Default shall have occurred and be
continuing;
(c) the fact that, immediately after such Revolving
Credit Borrowing, Term Loan Borrowing or Convertible Loan Borrowing,
as the case may be, (i) the aggregate outstanding principal amount of
the Syndicated Convertible Loans of all Banks, together with the
aggregate outstanding principal amount of all Money Market Convertible
Loans, will not exceed the aggregate amount of the Convertible Loan
Commitments; (ii) the aggregate outstanding principal amount of the
Syndicated Revolving Credit Advances of all Banks, together with the
aggregate outstanding principal amount of all Money Market Revolving
Credit Advances will not exceed the aggregate amount of the Revolving
Credit Commitments of all of the Banks as of such date; and (iii) the
aggregate outstanding principal amount of the Term Loans will not
exceed the aggregate amount of the Term Loan Commitments; and
(d) the fact that, the representations and warranties of
the Borrower contained in Article IV of this Agreement shall be true
on and as of the date of each Revolving Credit Borrowing and prior to
the Conversion Date, each Convertible Loan Borrowing.
Each Revolving Credit Borrowing, Term Loan Borrowing and Convertible Loan
Borrowing hereunder shall be deemed to be a representation and warranty by the
Borrower on the date of such Revolving Credit Borrowing, Term Loan Borrowing or
Convertible Loan Borrowing, as the case may be, as to the facts specified in
clauses (b), (c) and (d) of this Section; provided that a Convertible Loan
Borrowing made after the Conversion Date and a Term Loan Borrowing (excluding
the initial Term Loan Borrowing) shall not be deemed to be such a
representation and warranty as to the facts specified in clause (d) of this
Section.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The 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, by the nature of its business, such
qualification is necessary, 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 the Borrower of this
Agreement, the Notes and the other Loan Documents (i) are within the 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 the Borrower or of any agreement,
judgment, injunction, order, decree or other instrument binding upon the
Borrower or any of its Subsidiaries, and (v) do not result in the creation or
imposition of any Lien on any asset of the Borrower or any of its Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement constitutes a
valid and binding agreement of the Borrower 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 Borrower enforceable in accordance with their 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 Borrower and its Consolidated Subsidiaries as of December
31, 1993 and the related consolidated statements of income, shareholders'
equity and cash flows for the Fiscal Year then ended, reported on by Ernst &
Young, copies of which have been delivered to each of the Banks, and the
unaudited consolidated financial statements of the Borrower for the interim
period ended December 31, 1994, copies of which have been delivered to each of
the Banks, fairly present, in conformity with generally accepted accounting
principles, the consolidated financial position of the Borrower and its
Consolidated Subsidiaries as of such dates and their consolidated results of
operations and cash flows for such periods.
(b) Since December 31, 1993, there has been no material
adverse change in the business, financial position, results of operations or
prospects of the Borrower and its Consolidated Subsidiaries.
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(c) The Annual Statements of the licensed insurance
companies within the Insurance Group together with the supplemental schedules
thereto, as of December 31, 1994, copies of which have been delivered to each
of the Banks, fairly present the respective financial positions of the licensed
insurance companies within the Insurance Group as of such date and its results
of operations and cash flow for such period.
SECTION 4.05. Litigation. There is no action, suit or
proceeding pending, or to the knowledge of the Borrower threatened, against or
affecting the Borrower or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official which could materially
adversely affect the business, consolidated financial position or consolidated
results of operations of the Borrower and its Consolidated Subsidiaries or
which in any manner draws into question the validity or enforceability of, or
could impair the ability of the Borrower to perform its obligations under, this
Agreement, the Notes or any of the other Loan Documents.
SECTION 4.06. Compliance with ERISA. (a) The Borrower and
each member of the Controlled Group have fulfilled their obligations, if any,
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.
(b) Neither the Borrower nor any member of the Controlled
Group is or ever has been obligated to contribute to any Multiemployer Plan.
SECTION 4.07. Taxes. There have been filed on behalf of the
Borrower and its Subsidiaries all Federal, state and local income, excise,
property and other tax returns which are required to be filed by them and all
taxes due pursuant to such returns or pursuant to any assessment received by or
on behalf of the Borrower or any Subsidiary have been paid. The charges,
accruals and reserves on the books of the Borrower and its Subsidiaries in
respect of taxes or other governmental charges are, in the opinion of the
Borrower, adequate. United States income tax returns of the Borrower and its
Subsidiaries have been examined and closed through the Fiscal Year ended
December 31, 1985.
SECTION 4.08. Subsidiaries. Each of the Borrower's
Subsidiaries 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, by the nature of its
business, such qualification is necessary, and has all corporate powers and all
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
SECTION 4.09. Not an Investment Company. The Borrower is not
an "investment company" within the meaning of the Investment Company Act of
1940, as amended.
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SECTION 4.10. Ownership of Property; Liens. Each of the
Borrower and its Consolidated Subsidiaries 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 5.11.
SECTION 4.11. No Default. Neither the Borrower nor any of
its Consolidated Subsidiaries 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 will be materially adverse to the business,
operations, property or financial or other condition of the Borrower and its
Consolidated Subsidiaries or which will materially adversely affect the ability
of the Borrower to perform its obligations under the Loan Documents. No
Default or Event of Default has occurred and is continuing.
SECTION 4.12. Full Disclosure. All information heretofore
furnished by the Borrower to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower 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. The Borrower has disclosed to the Banks in writing any and all
facts which materially and adversely affect or may affect (to the extent the
Borrower can now reasonably foresee), the business, operations, prospects or
condition, financial or otherwise, of the Borrower and its Consolidated
Subsidiaries or the ability of the Borrower to perform its obligations under
this Agreement or any other Loan Document.
SECTION 4.13. Environmental Matters. (a) Neither the
Borrower nor any Subsidiary is subject to any Environmental Liability which is
likely to have a material adverse effect on the business, financial position,
results of operations or prospects of the Borrower or any of its Subsidiaries
and neither the Borrower nor any Subsidiary has been designated as a
potentially responsible party under CERCLA or under any state statute similar
to CERCLA. None of the Properties has been identified on any current or
proposed (i) National Priorities List under 40 C.F.R. Section 300, (ii)
CERCLIS list or (iii) any list arising from a state statute similar to CERCLA.
(b) No Hazardous Materials have been or are being used,
produced, manufactured, processed, generated, stored, disposed of, managed at,
or shipped or transported to or from the Properties or are otherwise present
at, on, in or under the Properties, or, to the best of the knowledge of the
Borrower, at or from any adjacent site or facility, except for Hazardous
Materials, such as cleaning solvents, pesticides and other materials used,
produced, manufactured, processed, generated, stored, disposed of, and managed
in the ordinary course of business in compliance with all applicable
Environmental Requirements.
SECTION 4.14. Insolvency. After giving effect to the
execution and delivery of the Loan Documents and the making of the Loans under
this Agreement, the Borrower will not be "insolvent," within the meaning of
such term as used in O.C.G.A Section 18-2-22, as amended from time to time, or
as defined in Section 101 of Title 11 of the United States Code, as amended
from time to time, or be unable to pay its debts generally as such debts become
due, or have an
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unreasonably small amount of capital to engage in any business or transaction,
whether current or contemplated.
SECTION 4.15 Public Utility Holding Company Act. Neither the
Borrower nor any of its Subsidiaries 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.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any
Revolving Credit Commitment, Term Loan Commitment or Convertible Loan
Commitment hereunder or any amount payable hereunder or under any Note remains
unpaid:
SECTION 5.01. Information. The Borrower will deliver to each
of the Banks:
(a) (i) as soon as available and in any event within 90
days after the end of each Fiscal Year, a consolidated balance sheet
and the consolidating balance sheets of the Borrower and its
Consolidated Subsidiaries as of the end of such Fiscal Year and the
related consolidated and consolidating 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 Ernst & Young 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, and (ii) as soon as available and in
any event within 90 days after the end of each fiscal year of each
Subsidiary within the Insurance Group (excluding Liberty Insurance
Services), a copy of the Annual Statement of each such Subsidiary
within the Insurance Group (excluding Liberty Insurance Services),
together with all supplemental schedules thereto, as of the end of
such fiscal year, all prepared in accordance with statutory accounting
principles;
(b) as soon as available and in any event within 60 days
after the end of each Fiscal Quarter, a consolidated balance sheet and
the consolidating balance sheets of the Borrower and its Consolidated
Subsidiaries as of the end of such quarter and the related
consolidated and consolidating statements of income and consolidated
and consolidating statements of cash flows for such quarter and for
the portion of the Fiscal Year ended at the end of such quarter,
setting forth in each case in comparative form the figures for the
corresponding quarter and the corresponding portion of the previous
Fiscal Year, all certified (subject to normal year-end adjustments) as
to fairness of presentation, generally accepted accounting principles
and consistency by the chief financial officer or the chief accounting
officer of the Borrower;
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(c) simultaneously with the delivery of each set of
financial statements referred to in clauses (a) and (b) above, a
certificate of the chief financial officer or the chief accounting
officer of the Borrower (i) setting forth in reasonable detail the
calculations required to establish whether the Borrower was in
compliance with the requirements of Sections 5.03 through 5.08,
inclusive, 5.12, 5.13 and 5.17(b) on the date of such financial
statements (which calculations shall be presented substantially in the
form attached hereto as Schedule 5.01(c)) 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 Borrower is taking or proposes to take with respect thereto;
(d) simultaneously with the delivery of each set of
annual financial statements referred to in clause (a)(i) 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 five Domestic Business Days after the Borrower
becomes aware of the occurrence of any Default, a certificate of the
chief financial officer or the chief accounting officer of the
Borrower setting forth the details thereof and the action which the
Borrower is taking or proposes to take with respect thereto;
(f) promptly upon the mailing thereof to the shareholders
of the Borrower, 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 Borrower 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 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;
(i) promptly after the Borrower knows of the commencement
or threat thereof, notice of any Forfeiture Proceeding;
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(j) promptly after the Borrower knows of the commencement
thereof, notice of any litigation, dispute or proceeding involving a
claim against the Borrower and/or any Subsidiary for $5,000,000 or
more in excess of amounts covered in full by applicable insurance; and
(k) from time to time such additional information
regarding the financial position or business of the Borrower and its
Subsidiaries as the Agent, at the request of any Bank, may reasonably
request.
SECTION 5.02. Inspection of Property, Books and Records. The
Borrower will keep, and will cause each Subsidiary to keep, proper books of
record and account in which full, true and correct entries in conformity with
generally accepted accounting principles shall be made of all dealings and
transactions in relation to its business and activities; and will permit, and
will cause each Subsidiary to permit, representatives of any Bank at such
Bank's expense for such Bank's direct costs incurred prior to the occurrence of
an Event of Default and at the Borrower's expense for all direct costs incurred
after the occurrence of an Event of Default 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. The Borrower agrees to cooperate and assist in such visits and
inspections, in each case at such reasonable times and as often as may
reasonably be desired.
SECTION 5.03. Ratio of Consolidated Debt to Consolidated
Total Capital. As of the last day of each Fiscal Quarter ending during each
period set forth below, the ratio of Consolidated Debt to Consolidated Total
Capital shall not be greater than the applicable ratio set forth below:
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
Closing Date
through March 31, 1996 .40 to 1.00
April 1, 1996 and thereafter .35 to 1.00
</TABLE>
SECTION 5.04. Minimum Stockholders' Equity. Stockholders'
Equity will at no time be less than $400,000,000, plus the sum of: (i) 50% of
the cumulative Reported Net Income during any period beginning after June 30,
1993 (taken as one accounting period), calculated quarterly but excluding from
such calculations any quarter in which Reported Net Income is negative; and
(ii) 100% of the cumulative Net Proceeds of Convertible Preferred Stock
received during any period after June 30, 1993, calculated quarterly.
SECTION 5.05. Stock Payments. Neither the Borrower nor any
Subsidiary shall make any Stock Payment during any Fiscal Year unless after
giving effect thereto (i) the aggregate amount of all Stock Payments made (A)
during such Fiscal Year does not exceed $10,000,000, and (B) during the period
commencing on the Closing Date and ending on the date
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<PAGE> 56
such Stock Payment is made does not exceed $25,000,000, and (ii) no Default
shall have occurred and be continuing.
SECTION 5.06. Restricted Payments. The Borrower will not
declare or make any Restricted Payment if the amount of such Restricted
Payment, when aggregated with all other Restricted Payments made after December
31, 1992, would exceed fifty percent (50%) of cumulative Net Income of the
Borrower for all fiscal periods beginning January 1, 1993; provided that: (i)
in no event shall the Borrower declare or make any Restricted Payment if after
giving effect to the payment of any such Restricted Payment, a Default shall
have occurred and be continuing; and (ii) for purposes of this Section 5.06
only, Net Income shall be determined without regard to any effect on Net Income
resulting solely from any treatment of post-retirement benefits of the Borrower
and its Consolidated Subsidiaries required by Financial Accounting Standards
Board Statement No. 106.
SECTION 5.07. Fixed Charges Coverage. As of the last day of
each Fiscal Quarter, commencing with the Fiscal Quarter ending March 31, 1995,
the ratio of Adjusted Cash Flow for the period of four Fiscal Quarters ending
on such day to Fixed Charges for the period of four Fiscal Quarters ending on
such date shall not be less than 2.0.
SECTION 5.08. Capital Expenditures. Capital Expenditures
will not exceed $15,000,000 in the aggregate in any Fiscal Year. For the
purposes of this Section 5.08, "Capital Expenditures" shall exclude the
following: (i) expenditures by Subsidiaries included within the Insurance
Group or by LIG in connection with Investment Properties; (ii) expenditures by
Subsidiaries included within the Insurance Group in connection with computer
software; and (iii) Film Payments made by Cosmos.
SECTION 5.09. Loans or Advances. Neither the Borrower nor
any of its Subsidiaries shall make loans or advances to any Person except
Permitted Advances; provided that after giving effect to any such Permitted
Advances, no Default shall have occurred and be continuing.
SECTION 5.10. Investments. The Borrower and its Subsidiaries
shall not make investments in any Person except as permitted by Section 5.09
and except investments in (i) direct obligations of the United States
Government maturing within one year, (ii) certificates of deposit issued by a
commercial bank whose credit is satisfactory to the Agent, (iii) commercial
paper rated A-1 or the equivalent thereof by Standard & Poor's Corporation or
P-1 or the equivalent thereof by Moody's Investors Service, Inc. and in either
case maturing within 6 months after the date of acquisition and/or (iv) tender
bonds the payment of the principal of and interest on which is fully supported
by a letter of credit issued by a United States bank whose long-term
certificates of deposit are rated at least AA or the equivalent thereof by
Standard & Poor's Corporation and Aa or the equivalent thereof by Moody's
Investors Service, Inc.; provided, however, that (x) this Section 5.10 shall
not prohibit investments made in the ordinary course of business involving
either (A) the investment portfolio of any Subsidiary within the Insurance
Group or (B) the real estate investment portfolio of the Borrower and its Minor
Subsidiaries, and (y) notwithstanding clause (x) (A) of this Section 5.10, each
bond portfolio of each of the
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<PAGE> 57
Subsidiaries within the Insurance Group must at all times maintain a weighted
average quality rating of A or the equivalent thereof by Standard & Poor's
Corporation or A-2 or the equivalent thereof by Moody's Investors Service, Inc.
SECTION 5.11. Negative Pledge. Neither the Borrower nor any
Subsidiary will create, assume or suffer to exist any Lien on any asset now
owned or hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing
Debt outstanding on the date of this Agreement in an aggregate
principal amount not exceeding $8,500,000;
(b) any Lien existing on any asset of any corporation at
the time such corporation becomes a Consolidated Subsidiary and not
created in contemplation of such event;
(c) any Lien on any asset securing Debt incurred or
assumed for the purpose of financing all or any part of the cost of
acquiring or constructing such asset, provided that such Lien attaches
to such asset concurrently with or within 18 months after the
acquisition or completion of construction thereof;
(d) any Lien on any asset of any corporation existing at
the time such corporation is merged or consolidated with or into the
Borrower or a Consolidated Subsidiary and not created in contemplation
of such event;
(e) any Lien existing on any asset prior to the
acquisition thereof by the Borrower or a Consolidated Subsidiary and
not created in contemplation of such acquisition;
(f) any Lien securing an Intercompany Loan; and
(g) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt secured by any Lien permitted by any
of the foregoing clauses of this Section, provided that (i) such Debt
is not secured by any additional assets, and (ii) the amount of such
Debt secured by any such Lien is not increased.
SECTION 5.12. Maximum Consolidated Debt. Consolidated Debt
will at no time exceed $385,000,000.
SECTION 5.13. Ratio of Consolidated Debt to Cash Flow. As of
the last day of each Fiscal Quarter ending during each period set forth below,
the ratio of Consolidated Debt as of such day to Cash Flow for the four Fiscal
Quarters ending on such day shall not be greater than the applicable ratio set
forth below.
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<PAGE> 58
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
Closing Date through June 30, 1995 6.50 to 1.00
July 1, 1995 through June 30, 1996 6.00 to 1.00
July 1, 1996 and thereafter 5.50 to 1.00
</TABLE>
SECTION 5.14. Conduct of Business and Maintenance of
Existence. The Borrower shall, and shall cause each Subsidiary to, (a)
maintain its corporate existence and carry on its business in substantially the
same manner and in substantially the same fields as such business is now
carried on and maintained, and (b) preserve, renew and keep in full force and
effect their respective rights, privileges, licenses (including, without
limitation, all broadcast licenses and insurance licenses) and franchises
necessary or desirable in the normal conduct of business. The business of any
Subsidiary of the Borrower that is created or acquired by the Borrower after
the date of this Agreement shall be in substantially the same field as the
business of the Borrower and its Subsidiaries on the date of this Agreement.
SECTION 5.15. Dissolution. Neither the Borrower nor any of
its Subsidiaries shall suffer or permit dissolution or liquidation either in
whole or in part or redeem or retire any shares of its own stock or that of any
Subsidiary, except (a) through corporate reorganization to the extent permitted
by Section 5.16, and (b) the Borrower and any Subsidiary may make Stock
Payments to the extent permitted by Section 5.05.
SECTION 5.16. Consolidations, Mergers and Sales of Assets.
The Borrower will not, nor will it permit any 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
business line or segment, provided that (1) the Borrower or any Subsidiary
(other than Cosmos) or any Minor Subsidiaries utilized in a merger or
acquisition transaction may merge with another Person if (A) such other Person
was organized under the laws of the United States of America or one of its
states, (B) the Borrower or such Subsidiary (other than Cosmos) or any Minor
Subsidiaries utilized in a merger or acquisition transaction (as the case may
be) is the corporation surviving such merger; and (C) immediately after giving
effect to such merger, no Default shall have occurred and be continuing; (2)
Subsidiaries of the Borrower may merge with one another; (3) Cosmos may
consolidate or merge with another Person with the prior written consent of the
Required Banks; and (4) the foregoing limitation on the sale, lease or other
transfer of assets and on the discontinuation or elimination of a business line
or segment shall not prohibit during any Fiscal Quarter, a transfer of assets
or the discontinuance or elimination of a business line or segment (in a single
transaction or in a series of related transactions) unless the aggregate assets
to be so transferred or utilized in a business line or segment to be so
discontinued, when combined with all other assets transferred, and all other
assets utilized in all other business lines or segments discontinued, during
such Fiscal Quarter and the immediately preceding seven Fiscal Quarters, either
(x) constituted more than 10% of Consolidated Total Assets at the end of the
eighth Fiscal Quarter immediately preceding such Fiscal Quarter, or (y)
contributed more than 10% of Consolidated Operating Profits during the 8
consecutive Fiscal Quarters immediately preceding such Fiscal Quarter.
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SECTION 5.17. Use of Proceeds. (a) No portion of the
proceeds of the Loans will be used by the Borrower (i) in connection with any
tender offer for, or other acquisition of (except as permitted in Section
5.17(c)), stock of any corporation with a view towards obtaining control of
such other corporation, (ii) directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of purchasing or carrying any Margin Stock,
or (iii) for any purpose in violation of any applicable law or regulation.
(b) The proceeds of the Loans made on the date of the
initial borrowing hereunder shall be used exclusively by the Borrower to
refinance existing indebtedness of the Borrower under that certain Credit
Agreement dated as of September 28, 1993 among the Borrower, Wachovia Bank of
North Carolina, N.A. as Agent and the banks named therein (as amended from time
to time).
(c) The proceeds of Loans other than those Loans
referenced in Section 5.17(b) shall be used exclusively by the Borrower (i) for
working capital purposes, (ii) to prepay or repay Loans pursuant to the terms
of this Agreement, and (iii) to finance the acquisition of the assets or
Capital Stock of any Person (other than a Subsidiary) engaged principally in
the life insurance business or in the television broadcasting business.
SECTION 5.18. Compliance with Laws; Payment of Taxes. The
Borrower will, and will cause each of its Subsidiaries and each member of the
Controlled Group to, comply with applicable laws (including but not limited to
ERISA), regulations and similar requirements of governmental authorities
(including but not limited to the PBGC), except where the necessity of such
compliance is being contested in good faith through appropriate proceedings
diligently pursued. The Borrower will, and will cause each of its Subsidiaries
to, pay promptly when due 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 Borrower or any Subsidiary, except
liabilities being contested in good faith by appropriate proceedings diligently
pursued and against which, if requested by the Agent, the Borrower shall have
set up reserves satisfactory to the Agent.
SECTION 5.19. Insurance. The Borrower will maintain, and
will cause each of its Subsidiaries to maintain (either in the name of the
Borrower or in such Subsidiary's own name), with financially sound and
reputable insurance companies acceptable to the Agent, insurance on all its
Property in at least such amounts and against at least 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 5.20. Change in Fiscal Year. The Borrower will not
change its Fiscal Year without the consent of the Required Banks.
SECTION 5.21. Maintenance of Property. The Borrower shall,
and shall cause each Subsidiary to, maintain all of its Properties and assets
in good condition, repair and working order, ordinary wear and tear excepted.
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<PAGE> 60
SECTION 5.22. Environmental Notices. The Borrower shall
furnish to the Banks and the Agent prompt written notice of all Environmental
Liabilities, pending, threatened 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.
SECTION 5.23. Environmental Matters. The Borrower will not,
and will not permit any Third Party to, use, produce, manufacture, process,
generate, store, dispose of, manage at, or ship or transport to or from the
Properties any Hazardous Materials except for Hazardous Materials such as
cleaning solvents, pesticides and other similar materials used, produced,
manufactured, processed, generated, stored, disposed or managed in the ordinary
course of business in compliance with all applicable Environmental
Requirements.
SECTION 5.24. Environmental Release. The Borrower agrees
that upon the occurrence of an Environmental Release it will act immediately to
investigate the extent of, and to take appropriate remedial action to
eliminate, such Environmental Release, whether or not ordered or otherwise
directed to do so by any Environmental Authority.
SECTION 5.25. Aggregate Values of Investment Properties and
Total Investments. (a) The Borrower will not permit, and will not permit any
of its Subsidiaries to permit, at any time the Aggregate Value of Investment
Properties to exceed 10% of the Aggregate Value of Total Investments.
(b) The Borrower will not permit, and will not permit any
of its Subsidiaries to permit, at any time the Aggregate Value of Investment
Properties to exceed $160,000,000.
SECTION 5.26. Surplus Relief Reinsurance. The Borrower will
not permit any Subsidiary within the Insurance Group to enter into any Surplus
Relief Reinsurance Transaction, if, upon giving effect to any such Surplus
Relief Reinsurance Transaction on a pro forma basis, the aggregate statutory
capital and surplus of the Subsidiaries within the Insurance Group would
increase by more than $10,000,000 in the aggregate as a result of all of the
Surplus Relief Reinsurance Transactions entered into by the Subsidiaries within
the Insurance Group during the period from the Closing Date through and
including the date of such Surplus Relief Reinsurance Transaction.
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) the Borrower shall fail to pay when due any principal
of any Syndicated Revolving Credit Advance, Money Market Revolving
Credit Advance, Syndicated Convertible Loan, Money Market Convertible
Loan or Term Loan or
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shall fail to pay any interest on any Syndicated Revolving Credit
Advance, Money Market Revolving Credit Advance, Syndicated Convertible
Loan, Money Market Convertible Loan or Term Loan within three Domestic
Business Days after such interest shall become due, or shall fail to
pay any fee or other amount payable hereunder within three Domestic
Business Days after such fee or other amount becomes due; or
(b) the Borrower shall fail to observe or perform any
covenant contained in Sections 5.02 to 5.17, inclusive; or
(c) the Borrower shall fail to observe or perform any
covenant or agreement contained in this Agreement (other than those
covered by clause (a) or (b) above) for thirty days after written
notice thereof has been given to the Borrower by the Agent at the
request of any Bank; or
(d) any representation, warranty, certification or
statement made or deemed made by the Borrower in Article IV of this
Agreement or in any certificate, financial statement or other document
delivered pursuant to this Agreement shall prove to have been
incorrect in any material respect when made (or deemed made); or
(e) the Borrower or any Subsidiary shall fail to make any
payment in respect of Debt 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 outstanding of the Borrower
or any Subsidiary or enables (or, with the giving of notice or lapse
of time or both, would enable) the holders of such Debt or any Person
acting on such holders' behalf to accelerate the maturity thereof; or
(g) the Borrower or any 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, or shall admit in writing its inability, 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 Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under
any bankruptcy, insolvency or
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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 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 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; 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; 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; or
(j) one or more judgments or orders for the payment of
money in an aggregate amount in excess of $2,500,000 shall be rendered
against the Borrower or any Subsidiary and such judgment or order
shall continue unsatisfied and unstayed for a period of 30 days; or
(k) a federal tax lien shall be filed against the
Borrower under Section 6323 of the Code or a lien of the PBGC shall be
filed against the Borrower under Section 4068 of ERISA and in either
case such lien 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 (other than Person(s) who are lineal descendants (including
without limitation adopted children) of W. Frank Hipp, spouses of such
lineal descendants, or fiduciaries with respect to voting stock held
by, under the control of or for the benefit of such lineal descendants
or spouses of such lineal descendants and other than Person(s) whose
ownership of 20% or more of the outstanding shares of the voting stock
of the Borrower is approved in advance by the Board of Directors of
the Borrower) shall 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 20% 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
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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) either (i) any Forfeiture Proceeding shall have been
commenced or the Borrower shall have given the Banks written notice of
the commencement or threatened commencement of any Forfeiture
Proceeding as provided in Section 5.01(i); or (ii) the Agent has a
good faith basis to believe that a Forfeiture Proceeding has been
threatened or commenced;
then, and in every such event, the Agent shall (i) if requested by the Required
Banks, by notice to the Borrower terminate the Revolving Credit Commitments,
Term Loan Commitments and Convertible Loan Commitments and they shall thereupon
terminate, and (ii) if requested by the Required Banks, by notice to the
Borrower declare the Notes (together with accrued interest thereon) and all
other amounts payable hereunder and under the other Loan Documents to be, and
the Notes (together with all accrued interest thereon) and all other amounts
payable hereunder and under the other Loan Documents 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 Borrower; provided
that if any Event of Default specified in clause (g) or (h) above occurs with
respect to the Borrower, without any notice to the Borrower or any other act by
the Agent or the Banks, the Revolving Credit Commitments, Term Loan Commitments
and Convertible Loan Commitments shall thereupon automatically terminate and
the Notes (together with accrued interest thereon) and all other amounts
payable hereunder and under the other Loan Documents shall automatically become
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower.
SECTION 6.02. Notice of Default. The Agent shall give notice
to the Borrower of any Event of 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,
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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 the 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 willful 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 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, telefax, 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 (or, in the case of instructions given with respect to any matter as to
which Section 9.05(a) requires the signatures of all the Banks, instructions
signed by all the Banks), and such instructions of the Required Banks or all
the Banks, as the case may be, 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 non-payment 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 non-payment of principal
of or interest on the Loans, whether or not it has received any notice of the
occurrence of such non-payment. The Agent shall (subject to Section 9.05) take
such action 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.
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SECTION 7.04. Rights of Agent and its Affiliates as a Bank.
With respect to any Loans made by an Affiliate of Wachovia, such Affiliate (and
Wachovia if it becomes a Bank hereunder) 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 an Affiliate of the Agent (or in
Wachovia's case, acting as the Agent), and the term "Bank" or "Banks" shall,
unless the context otherwise indicates, include such Affiliate of Wachovia (or
Wachovia, if it becomes a Bank hereunder) in its individual capacity. Such
Affiliate and the Agent may (without having to account therefor to any Bank)
accept deposits from, lend money to and generally engage in any kind of
banking, trust or other business with the Borrower (and any of its Affiliates)
as if it were not an Affiliate of the Agent or acting as the Agent, as the case
may be, and such Affiliate and the Agent may accept fees and other
consideration from the Borrower (in addition to any agency fees and arrangement
fees heretofore agreed to between the Borrower 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 Borrower, ratably in proportion with its aggregate Commitments, 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 willful misconduct of the Agent. If
any indemnity furnished to the Agent for any purpose shall, in the reasonable
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 9.07 (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
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of any Note shall be conclusive and binding on any subsequent holder,
transferee or assignee of that Note or of any Note or Notes issued in exchange
therefor or replacement thereof.
SECTION 7.08. Non-Reliance 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 (or any
Bank) informed as to the performance or observance by the Borrower 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
Borrower 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
Borrower 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 $500,000,000 and
which has a long-term certificate of deposit rating or long-term senior
indebtedness rating by Moody's Investor Services, Inc. of Aa2 or better (or the
comparable rating then in existence) or by Standard and Poor's Corporation of
AA or better (or the comparable rating then in existence). Upon the acceptance
of any appointment 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
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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 as determined by the Agent will not adequately
and fairly reflect the cost to such Banks of funding the Euro-Dollar
Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower 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
Euro-Dollar Loans shall be suspended. Unless the Borrower notifies the Agent
at least two Domestic Business Days before the date of any Borrowing of Euro-
Dollar 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 in any
existing or future law, rule or regulation, 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 authority, bank or 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 (or its Lending Office) to make, maintain or fund its Euro-Dollar Loans
and such Bank shall so notify the Agent, the Agent shall forthwith give notice
thereof to the other Banks and the Borrower, 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 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 to maturity and shall so specify in such
notice, the Borrower shall immediately prepay in full the then outstanding
principal amount of each Euro-Dollar Loan of such Bank, together with accrued
interest thereon and any amount due such Bank pursuant to Section 8.05(a).
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Concurrently with prepaying each such Euro-Dollar Loan, the 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 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 subject any Bank (or its Lending Office) to any
tax, duty or other charge with respect to its Euro-Dollar Loans, its
Notes or its obligation to make Euro-Dollar Loans, or shall change the
basis of taxation of payments to any Bank (or its Lending Office) of
the principal of or interest on its Euro-Dollar Loans or any other
amounts due under this Agreement in respect of its Euro-Dollar Loans
or its obligation to make Euro-Dollar Loans (except for changes in the
rate of tax on the overall net income of such Bank or its Lending
Office imposed by the jurisdiction in which such Bank's principal
executive office or Lending Office is located); or
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal
Reserve System, but excluding any such requirement included in an
applicable Euro-Dollar Reserve Percentage) against assets of, deposits
with or for the account of, or credit extended by, any Bank (or its
Lending Office); or
(iii) shall impose on any Bank (or its Lending Office) or
the London interbank market any other condition affecting its
Euro-Dollar Loans, its Notes or its obligation to make Euro-Dollar
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 Euro-Dollar 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 Note 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 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 in any existing or future law, rule or regulation, 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
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adequacy) by an amount deemed by such Bank to be material, then from time to
time, within 15 days after demand by such Bank, the Borrower shall pay to such
Bank such additional amount or amounts as will compensate such Bank for such
reduction.
(c) Each Bank will promptly notify the Borrower 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) The provisions of this Section 8.03 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.
SECTION 8.04. Base Rate Loans Substituted for Affected
Euro-Dollar Loans. If (i) the obligation of any Bank to make or maintain
Euro-Dollar 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 five Euro-Dollar Business Days' 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 shall be made instead as Base Rate Loans
(interest and principal on such Loans shall be payable
contemporaneously with the related Euro-Dollar Loans of the other
Banks), and
(b) after its Euro-Dollar Loans have been repaid, all
payments of principal which would otherwise be applied to repay such
Euro-Dollar Loans shall be applied to repay its Base Rate Loans
instead.
In the event that the Borrower shall elect that the provisions of this Section
shall apply to any Bank, the Borrower shall remain liable for, and shall pay to
such Bank as provided herein, all amounts due such Bank under Section 8.03 in
respect of the period preceding the date of conversion of such Bank's Loans
resulting from the Borrower's election.
SECTION 8.05. Compensation. Upon the request of any Bank,
delivered to the Borrower and the Agent, the Borrower 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 2.09,
Section 2.10, Section 8.02 or otherwise) of a Euro-Dollar Loan, Money
Market Revolving
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Credit Advance or Money Market Convertible Loan on a date other than
the last day of an Interest Period for such Euro-Dollar Loan, Money
Market Revolving Credit Advance or Money Market Convertible Loan, as
the case may be;
(b) any failure by the Borrower to prepay a Euro-Dollar
Loan, Money Market Revolving Credit Advance or Money Market
Convertible Loan on the date for such prepayment specified in the
relevant notice of prepayment hereunder;
(c) any failure by the Borrower to borrow a Euro-Dollar
Loan on the date for the Euro-Dollar Borrowing of which such
Euro-Dollar Loan is a part specified in the applicable Notice of
Borrowing delivered pursuant to Section 2.02; or
(d) any failure by the Borrower to borrow a Money Market
Revolving Credit Advance or Money Market Convertible Loan (with
respect to which the Borrower has accepted a Money Market Quote) on
the date for the Money Market Borrowing of which such Money Market
Revolving Credit Advance or Money Market Convertible Loan is a part
specified in the applicable Money Market Quote Request delivered
pursuant to Section 2.03;
such compensation to include, without limitation, 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 Euro-Dollar Loan (or, in the case
of a failure to prepay or borrow, the Interest Period for such Euro-Dollar Loan
which would have commenced on the date of such failure to prepay or borrow) at
the applicable rate of interest for such Euro-Dollar 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.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, facsimile transmission or similar writing) and shall be given to such
party at its address, telex number or telecopy number set forth on the
signature pages hereof or such other address, telex number or telecopy number
as such party may hereafter specify for the purpose by notice to the Agent and
the Borrower. Each such notice, request or other communication shall be
effective (i) if given by telex, when such telex is transmitted to the telex
number specified in this Section and the appropriate answerback is received,
(ii) if given by mail, 72 hours after such communication is deposited in the
mails with
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first class postage prepaid, addressed as aforesaid, (iii) if given by
telecopy, when receipt is confirmed by telephone, or (iv) if given by any other
means, when delivered at the address specified in this Section; provided that
all notices, requests and other communications given by telecopy to the
Borrower shall be given at the telecopy number set forth under the signature of
the Borrower on the signature pages hereof; provided further 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 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; Indemnification. (a) The Borrower
shall pay (i) all out-of-pocket expenses of the Agent, including fees and
disbursements of special counsel for the Agent, in connection with the
preparation, review and negotiation 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 an Event of Default occurs, all out-of-pocket expenses incurred by the
Agent or any Bank, including fees and disbursements of counsel, in connection
with such Event of 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 Borrower shall indemnify 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.
(b) The Borrower agrees to indemnify and hold harmless
the Agent and each Bank (an "Indemnified Person") from and against any and all
claims, damages, liabilities and expenses (including, without limitation,
reasonable counsel fees and expenses) which may be incurred by or asserted
against the Agent or such Bank in connection with or arising out of any
investigation, litigation or proceeding related to the transactions
contemplated by this Agreement or any other Loan Document, whether or not the
Agent or such Bank is a party thereto; provided, however, the Borrower shall
not be obligated to indemnify an Indemnified Person to the extent any claim,
damage, liability or expense shall arise from such Indemnified Person's gross
negligence or willful misconduct.
SECTION 9.04. Sharing of Set-Offs. (a) The Borrower hereby
grants to each Bank, as security for the full and punctual payment and
performance of the obligations of the Borrower under this Agreement, a
continuing lien on and security interest in all deposits and other sums
credited by or due from such Bank to the Borrower or subject to withdrawal by
the Borrower; and regardless of the adequacy of any collateral or other means
of obtaining repayment of such obligations, each Bank may at any time upon or
after the occurrence of any Event of Default, and without notice to the
Borrower, set off the whole or any portion or portions of any or all such
deposits and other sums against such obligations, whether or not any other
Person or Persons could also withdraw money therefrom.
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(b) Each Bank agrees that if it shall, by exercising any right
of set-off or counterclaim or otherwise, receive payment of a proportion of the
aggregate amount of principal and interest due with respect to the Notes
(excluding the Money Market Revolving Credit Notes and the Money Market
Convertible Loan Notes) 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 due with respect to the Notes (excluding the Money Market
Revolving Credit Notes and the Money Market Convertible Loan Notes) held by
such other Bank, the Bank receiving such proportionately greater payment shall
purchase such participations in the Notes (excluding the Money Market Revolving
Credit Note and the Money Market Convertible Loan Note) held by the other Banks
owing to such other Banks, and/or such other adjustments shall be made, as may
be required so that all such payments of principal and interest with respect to
the Notes (excluding the Money Market Revolving Credit Notes and the Money
Market Convertible Loan 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 set-off 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
(including, without limitation, the Money Market Revolving Credit Notes and the
Money Market Convertible Loan Notes) under the Term Loan Notes, Syndicated
Revolving Credit Notes and Syndicated Convertible Loan 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. The Borrower agrees, to the fullest extent it may effectively do so
under applicable law, that any holder of a participation in a Notes (excluding
the Money Market Revolving Credit Notes and the Money Market Convertible Loan
Notes), whether or not acquired pursuant to the foregoing arrangements, may
exercise rights of set-off or counterclaim and other rights with respect to
such participation as fully as if such holder of a participation were a direct
creditor of the Borrower in the amount of such participation.
SECTION 9.05. Amendments and Waivers. (a) Any provision of
this Agreement, the Notes 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
Borrower and the Required Banks (and, if the rights or duties of the Agent are
affected thereby, by the Agent); provided that, except as provided below in
this subsection, no such amendment or waiver shall, unless signed by all the
Banks, (i) change the Revolving Credit Commitment, Convertible Loan Commitment
or Term Loan Commitment of any Bank or subject any Bank to any additional
obligation, (ii) change the principal of or rate of interest on any Loan or any
fees hereunder, (iii) change the date fixed for any payment of principal of or
interest on any Loan or any fees hereunder (including, without limitation, the
Term Loan Maturity Date, Revolving Credit Maturity Date and Convertible Loan
Maturity Date), (iv) change the amount of principal, interest or fees due on
any date fixed for
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the payment thereof, (v) change the percentage of the Revolving Credit
Commitment, Convertible Loan Commitment or Term Loan Commitment or of the
aggregate unpaid principal amount of the Notes, or the number 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, (vii)
release or substitute all or any substantial part of the collateral (if any)
held as security for the Loans, (viii) release any guaranty given to support
payment of the Loans, or (ix) modify Section 2.09,2.11, Article III, Section
8.03, Section 8.05, Section 9.03, Section 9.04 or Section 9.07(a).
(b) The Borrower 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
Borrower 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 Borrower to each Bank forthwith following the date on
which the same shall have been executed and delivered by the requisite
percentage of Banks. The Borrower 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 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 9.06. 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 9.07. 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 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
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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, or (iv) any change in the rate at which
either interest is payable thereon or conversion rights fee or facility fee is
payable hereunder from the rate at which the Participant is entitled to receive
interest, facility fees or conversion rights fees (as the case may be) in
respect of such participation. The Borrower agrees 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) Any Bank may at any time assign to one or more banks
or financial institutions (each an "Assignee") all, or a proportionate part of
all, 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 in the form attached
hereto as Exhibit F, executed by such Assignee, such transferor Bank and the
Agent (and, in the case of an Assignee that is not then a Bank or an Affiliate
of a Bank, by the Borrower); 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 Revolving Credit
Commitment, Term Loan Commitment and Convertible Loan Commitment (ii) the
amount of the Revolving Credit Commitment, Term Loan Commitment and Convertible
Loan Commitment of the assigning Bank subject to such assignment (determined as
of the effective date of the assignment) shall be equal to $10,000,000 (or any
larger multiple of $1,000,000), (iii) no interest may be sold by a Bank
pursuant to this paragraph (c) to any Assignee that is not then a Bank or
Affiliate of a Bank without the consent of the Borrower, which consent shall
not be unreasonably withheld. The Borrower's consent shall not be required to
any assignment occurring during the continuance of a Default. Upon (A)
execution of the Assignment and Acceptance by such transferor Bank, such
Assignee, the Agent and (if applicable) the Borrower, (B) delivery of an
executed copy of the Assignment and Acceptance to the Borrower 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 by the assigning Bank 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
Revolving Credit Commitment, Term Loan Commitment and Convertible Loan
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 Borrower, 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 Borrower
shall make appropriate arrangements so that, if required, a new Note is issued
to each of such Assignee and such transferor Bank.
(d) Subject to the provisions of Section 9.08, the
Borrower authorizes each Bank to disclose to any Participant, Assignee or other
transferee (each a "Transferee") and any prospective Transferee any and all
financial and other information in such Bank's possession concerning the
Borrower which has been delivered to such Bank by the Borrower 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.
-66-
<PAGE> 75
(e) No Transferee shall be entitled to receive any
greater payment under Section 8.03 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) Notwithstanding anything herein to the contrary, any
Bank may pledge and assign its rights and interests under this Agreement and
its Notes to any Federal Reserve Bank as collateral.
SECTION 9.08. Confidentiality. Each Bank agrees to exercise
its best efforts to keep any information delivered or made available by the
Borrower 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 9.08.
SECTION 9.09. 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 9.07 of this Agreement, the
disposition of the Note held by that Bank shall at all times be within its
exclusive control.
SECTION 9.10. 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 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 9.11. Survival of Certain Obligations. Sections
8.03(a), 8.03(b), 8.05 and 9.03, and the obligations of the Borrower
thereunder, shall survive, and shall continue to be
-67-
<PAGE> 76
enforceable notwithstanding the termination of this Agreement and the
Commitments and the payment in full of the principal of and interest on all
Loans.
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. Consent to Jurisdiction. The Borrower (a)
submits to 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, (b) 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 (c) 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 Borrower. Nothing herein contained, 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
Borrower, within any other state or jurisdiction.
SECTION 9.14. Counterparts. This Agreement may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
SECTION 9.15. Miscellaneous. If any term or provision of
this Agreement or the application thereof to any Person or circumstances shall,
to any extent, be invalid or unenforceable, the remainder of such term or
provision or the application thereof to Persons or circumstances other than
those as to which it is held invalid or unenforceable shall not be affected
thereby and shall be valid and enforceable to the fullest extent permitted by
law. The Loan Documents contain the entire agreement of the parties with
respect to the matters covered and the transactions contemplated hereby and
thereby, and no other agreement, statement or promise made by any such party,
or by any employee, officer, agent or attorney of such party, which is not
contained herein or therein shall be valid or binding. The section and
subsection headings of this Agreement are for convenience only and shall not
limit or otherwise affect any of the terms thereof.
SECTION 9.16. Termination of Prior Credit Agreement. The
Borrower and the Banks agree that: (i) on the Closing Date, all loans, fees and
other amounts due and payable by the Borrower to the Banks under the Prior
Credit Agreement shall be paid in full, except the Unmatured Prior Loans; (ii)
on and after the Closing Date, no new funds shall be advanced and no additional
facility fees shall accrue under the Prior Credit Agreement; and (iii) when the
Unmatured Prior Loans have been paid in full, the Prior Credit Agreement shall
terminate in all respects, except for any indemnification or other provisions
which expressly survive termination.
-68-
<PAGE> 77
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
THE LIBERTY CORPORATION
ATTEST: By:
-----------------------------------------
Title: Sr. VP of Finance & Treasurer
-------------------------------------
/s/ Martha G. Williams Address:
------------------------
Name: Martha G. Williams P. O. Box 789
------------------ Greenville, South Carolina 29602
Title: Secretary Telecopy Number: (803) 292-4390
----------------- Telephone Number: (803) 268-8435
[CORPORATE SEAL]
(Remainder of this page intentionally left blank)
-69-
<PAGE> 78
WACHOVIA BANK OF GEORGIA, N.A.
as Agent
By:
---------------------------------
Title: Senior Vice President
-----------------------------
Notice Address:
--------------
Wachovia Bank of Georgia, N.A.
191 Peachtree Street, N. E.
Atlanta, Georgia 30303
Attention: Terrence S. Katon, Vice
President
Telecopy Number: (404) 332-4005
Telephone Number: (404) 332-1253
-70-
<PAGE> 79
Commitments:
Revolving Credit Commitment
$45,000,000 WACHOVIA BANK OF NORTH CAROLINA, N.A.
Term Loan Commitment
$20,000,000 By:
---------------------------------
Convertible Loan Commitment Title: Senior Vice President
$10,000,000 ------------------------------
Lending Office
--------------
Wachovia Bank of North Carolina, N.A.
400 South Tryon Street
P.O. Box 31608
Charlotte, North Carolina 28231
Telex number: 4613011
Answerback: WAC UI
Telecopy number: (704) 378-5624
-71-
<PAGE> 80
Revolving Credit Commitment
$45,000,000 WACHOVIA BANK OF SOUTH CAROLINA, N.A.
Term Loan Commitment
$20,000,000 By:
---------------------------------
Title: Vice President
-----------------------------
Convertible Loan Commitment
$10,000,000 Lending Office
--------------
Wachovia Bank of South Carolina, N.A.
1401 Main Street, Suite 705
Columbia, South Carolina 29226
Telex number: 205 807
Answerback: SCNB UR
Telecopy number: (803) 765-3232
-72-
<PAGE> 81
Revolving Credit Commitment
$24,000,000.00 NATIONSBANK OF GEORGIA, N.A.
Term Loan Commitment
$10,666,666.67 By:
--------------------------------
Title: Vice President
Convertible Loan Commitment ----------------------------
$5,333,333.33
Lending Office
--------------
NationsBank of Georgia, N.A.
600 Peachtree Street, N.E.
Atlanta, Georgia 30303-2213
Telecopy number: (404) 607-6318
-73-
<PAGE> 82
Revolving Credit Commitment
$24,000,000.00 THE BANK OF TOKYO, LTD., ATLANTA AGENCY
Term Loan Commitment
$10,666,666.67 By:
------------------------------------
Title: Vice President
Convertible Loan Commitment --------------------------------
$5,333,333.33
Lending Office
--------------
The Bank of Tokyo, Ltd., Atlanta Agency
5050 Georgia-Pacific Center
133 Peachtree Street, N.E.
Atlanta, Georgia 30303
Telex number: 6827300
Answerback: BOT ATL
Telecopy number: (404) 577-1155
-74-
<PAGE> 83
Revolving Credit Commitment
$9,000,000 THE SANWA BANK, LTD., ATLANTA AGENCY
Term Loan Commitment
$4,000,000 By:
--------------------------------
Convertible Loan Commitment Title: Vice President
$2,000,000 -----------------------------
Lending Office
--------------
The Sanwa Bank, Ltd., Atlanta Agency
4750 Georgia-Pacific Center
133 Peachtree Street, N.E.
Atlanta, Georgia 30303
Telex number: 4611830
Answerback: SANWATL
Telecopy number: (404) 589-1629
-75-
<PAGE> 84
Revolving Credit Commitment
$18,000,000 NBD BANK
Term Loan Commitment
$8,000,000 By: James D. Heinz
-------------------------------
Convertible Loan Commitment Title: Vice President
$4,000,000 ----------------------------
Lending Office
--------------
NBD Bank
National Banking Division
611 Woodward Avenue
Detroit, Michigan 48226
Telex number: 4320060
Answerback: NATIONBANK DET
Telecopy number: (313) 225-2649
-76-
<PAGE> 85
Revolving Credit Commitment
$9,000,000 THE FUJI BANK, LIMITED
Term Loan Commitment
$4,000,000 By:
-------------------------------
Convertible Loan Commitment Title: Vice President & Manager
$2,000,000 ---------------------------
Lending Office
--------------
The Fuji Bank, Limited
Marquis One Tower, Suite 2100
245 Peachtree Center Avenue, N.E.
Atlanta, Georgia 30303-1208
Telex number: 9102507122
Answerback: FUJI BANK LTD UQ
Telecopy number: (404) 653-2119
-77-
<PAGE> 86
Revolving Credit Commitment
$9,000,000 THE BANK OF NEW YORK
Term Loan Commitment
$4,000,000 By:
------------------------------
Title: Vice President
---------------------------
Convertible Loan Commitment
$2,000,000 Lending Office
--------------
The Bank of New York
One Wall Street, 17th Floor
New York, New York 10286
Telex number: TRT 177363
Answerback: BONY UT
Telecopy number: (212) 809-9520
-78-
<PAGE> 87
Revolving Credit Commitment
$9,000,000 BRANCH BANKING & TRUST COMPANY OF
SOUTH CAROLINA
Term Loan Commitment
$4,000,000
By:
--------------------------------
Convertible Loan Commitment Title: Assistant Vice President
$2,000,000 -----------------------------
Lending Office
--------------
Branch Banking & Trust Company of
South Carolina
301 N. Main Street, Daniel Building
Greenville, South Carolina 29601
Telex number: 362817
Answerback: None
Telecopy number: (803) 241-7599
-79-
<PAGE> 88
Revolving Credit Commitment
$24,000,000.00 FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
Term Loan Commitment
$10,666,666.66
By:
Convertible Loan Commitment --------------------------------
$5,333,333.34 Title: Assistant Vice President
-----------------------------
Lending Office
--------------
First Union National Bank of North Carolina
One First Union Center, TW-19
301 South College Street
Charlotte, North Carolina 28288-0735
Telex number: 6843115
Answerback: FUNBCHA
Telecopy number: (704) 383-9144
-80-
<PAGE> 89
Revolving Credit Commitment
$9,000,000 BANK OF MONTREAL
Term Loan Commitment
$4,000,000 By:
--------------------------------
Title: Director
-----------------------------
Convertible Loan Commitment
$2,000,000 Lending Office
--------------
Bank of Montreal
115 South LaSalle Street
12th Floor West
Chicago, Illinois 60603
Telex number: None
Answerback: None
Telecopy number: (312) 750-3783
-----------------
TOTAL COMMITMENTS
Revolving Credit Commitment
$225,000,000.00
Term Loan Commitment
$100,000,000.00
Convertible Loan Commitment
$50,000,000.00
-81-
<PAGE> 90
SCHEDULE 2.06
<TABLE>
<CAPTION>
Revolving Credit
Term Loans which are Advances which are Euro-
Euro-Dollar Loans and Dollar Loans and
Convertible Loans which Convertible Loans which
are Euro-Dollar Loans on are Euro-Dollar Loans
Ratio of Consolidated and after the prior to the
Debt to Cash Flow Base Rate Loan Conversion Date Conversion Date
------------------ -------------- ------------------------ ------------------------
<S> <C> <C> <C>
Greater than or equal to +0% +1.1% +.80%
5.5 to 1.
Equal to or greater than
4.75 to 1.0 but less
than 5.5 to 1.0
+0% +.95% +70%
Equal to or greater than
3.75 to 1.0 but less
than 4.75 to 1.0 +0% +.75% +.55%
Equal to or greater than
3.25 to 1.0 but less
than 3.75 to 1.0 +0% +.625% +.45%
Less than 3.25 to 1.0 +0% +.50% +.35%
</TABLE>
<PAGE> 91
SCHEDULE 5.01(c)
FORM OF COMPLIANCE CERTIFICATE
MEMORANDUM
To: Wachovia Bank of Georgia, N.A., as Agent Date:__________
From: The Liberty Corporation
Pursuant to Section 5.01 (c) of the Credit Agreement (the
"Credit Agreement") dated as of March 21, 1995 among The Liberty Corporation,
the Banks listed on the signature pages thereof and Wachovia Bank of Georgia,
N.A., as Agent, _______ the duly authorized ______ of The Liberty Corporation,
hereby certifies to the Agent and the Banks that [no Default exists on the date
hereof] or [a Default exists on the date hereof and the Borrower has taken (or
proposes to take) the following action _______.] Terms used herein have the
meanings assigned to them in the Credit Agreement.
Further, we present the following calculations as of
_________________________ _____, _______ which establish whether the Borrower
was in compliance with the requirements of Sections 5.03 through 5.08,
inclusive, 5.12, 5.13, and 5.17(b) on such date.
Actual Requirement Under
------ -----------------
Credit Agreement
----------------
Section 5.03
Ratio of Consolidated Debt
to Consolidated Total Capital
Section 5.04
Minimum Stockholder's Equity
Section 5.05
Stock Payments
Section 5.06
Restricted Payment
Section 5.07
Ratio of Adjusted Cash Flow
to Fixed Charges
<PAGE> 92
Section 5.08
Capital Expenditures
Section 5.12
Maximum Consolidated Debt
Section 5.13
Ratio of Consolidated Debt
to Cash Flow
Section 5.17 (b)
Use of Proceeds
THE LIBERTY CORPORATION
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
-2-
<PAGE> 93
EXHIBIT A-1
SYNDICATED REVOLVING CREDIT NOTE
$_________________ Atlanta, Georgia
March 21, 1995
For value received, THE LIBERTY CORPORATION, a South Carolina
corporation (the "Borrower") promises to pay to the order of
___________________________ (the "Bank"), for the account of its Lending
Office, the principal sum of ___________________ and No/100 Dollars
($___________) or such lesser amount as shall equal the unpaid principal amount
of each Syndicated Revolving Credit Advance 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 Revolving Credit
Note on the dates and at the rate or rates provided for 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, or such
other address as may be specified from time to time pursuant to the Credit
Agreement.
All Syndicated Revolving Credit Advances 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, or any error of the
Bank in making, any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Credit Agreement.
This Note is one of the Syndicated Revolving Credit Notes
referred to in the Credit Agreement dated as of March 21, 1995 among the
Borrower, the banks listed on the signature pages thereof and their successors
and assigns and Wachovia Bank of Georgia, N.A., as Agent (as the same may be
amended or 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 prepayment and the
repayment hereof and the acceleration of the maturity hereof.
The Borrower hereby waives presentment, demand, protest,
notice of demand, protest and nonpayment and any other notice required by law
relative hereto, except to the extent as otherwise may be expressly provided
for in the Credit Agreement.
The Borrower agrees, in the event that this note or any
portion hereof is collected by law or through an attorney at law, to pay all
reasonable costs of collection, including, without limitation, reasonable
attorneys' fees.
-1-
<PAGE> 94
IN WITNESS WHEREOF, the Borrower has caused this Syndicated
Revolving Credit Note to be duly executed under seal, by its duly authorized
officer as of the day and year first above written.
THE LIBERTY CORPORATION
By: ______________________________
Title:
Attest:
__________________________
Title:
[CORPORATE SEAL]
-2-
<PAGE> 95
Syndicated Revolving Credit Note (cont'd)
SYNDICATED REVOLVING CREDIT ADVANCES AND PAYMENTS OF PRINCIPAL
________________________________________________________________________________
<TABLE>
<CAPTION>
Type Amount Amount of
of Interest of Principal Maturity Notation
Date Loan* Rate Loan Repaid Date Made By
---- ----- ------- ------ --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
</TABLE>
__________________________________
* i.e., a Base Rate or Euro-Dollar Loan.
-3-
<PAGE> 96
EXHIBIT A-2
MONEY MARKET REVOLVING CREDIT NOTE
$___________ Atlanta, Georgia
March 21, 1995
For value received, THE LIBERTY CORPORATION, a South Carolina
corporation (the "Borrower"), promises to pay to the order of
______________________________________ (the "Bank"), for the account of its
Lending Office, the principal sum of __________________ and No/100 Dollars
($_____________), or such lesser amount as shall equal the unpaid principal
amount of each Money Market Revolving Credit 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 Money Market Revolving Credit
Note on the dates and at the rate or rates provided for 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, or such
other address as may be specified from time to time pursuant to the Credit
Agreement.
All Money Market Revolving Credit 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, or any error of the
Bank in making, any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Credit Agreement.
This note is one of the Money Market Revolving Credit Notes
referred to in the Credit Agreement dated as of March 21, 1995 among the
Borrower, the banks listed on the signature pages thereof and their successors
and assigns and Wachovia Bank of Georgia, N.A., as Agent (as the same may be
amended or 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 prepayment and the
repayment hereof and the acceleration of the maturity hereof.
The Borrower hereby waives presentment, demand, protest, notice of
demand, protest and nonpayment and any other notice required by law relative
hereto, except to the extent as otherwise may be expressly provided for in the
Credit Agreement.
The Borrower agrees, in the event that this note or any portion
hereof is collected by law or through an attorney at law, to pay all reasonable
costs of collection, including, without limitation, reasonable attorneys' fees.
-1-
<PAGE> 97
IN WITNESS WHEREOF, the Borrower has caused this Money Market
Revolving Credit Note to be duly executed under seal, by its duly authorized
officer as of the day and year first above written.
THE LIBERTY CORPORATION
By: ______________________________
Title:
Attest:
____________________
Title:______________
[Coporate Seal]
-2-
<PAGE> 98
Money Market Revolving Credit Note (cont'd)
MONEY MARKET REVOLVING CREDIT LOANS AND PAYMENTS OF PRINCIPAL
________________________________________________________________________________
<TABLE>
<CAPTION>
Amount Amount of
Interest of Principal Maturity Notation
Date Rate Loan Repaid Date Made By
---- ------- ------ --------- -------- --------
<S> <C> <C> <C> <C> <C>
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
</TABLE>
<PAGE> 99
EXHIBIT A-3
TERM NOTE
$_________________ Atlanta, Georgia
March, 21, 1995
For value received, THE LIBERTY CORPORATION, a South Carolina
corporation (the "Borrower") promises to pay to the order of
______________________________________ (the "Bank"), for the account of its
Lending Office, the principal sum of ____________________ and No/100 Dollars
($___________) or such lesser amount as shall equal the unpaid principal amount
of each Term 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 Term Note on the dates and at the rate or rates
provided for 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, or such other address as may be specified from time to
time pursuant to the Credit Agreement.
All Term 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, or any error of the Bank in making, any
such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Credit Agreement.
This note is one of the Term Notes referred to in the Credit
Agreement dated as of March 21, 1995 among the Borrower, the banks listed on
the signature pages thereof and their successors and assigns and Wachovia Bank
of Georgia, N.A., as Agent (as the same may be amended or 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 prepayment and the repayment hereof and the acceleration of
the maturity hereof.
The Borrower hereby waives presentment, demand, protest, notice of
demand, protest and nonpayment and any other notice required by law relative
hereto, except to the extent as otherwise may be expressly provided for in the
Credit Agreement.
The Borrower agrees, in the event that this note or any portion
hereof is collected by law or through an attorney at law, to pay all reasonable
costs of collection, including, without limitation, reasonable attorneys' fees.
<PAGE> 100
IN WITNESS WHEREOF, the Borrower has caused this Term Note to be
duly executed under seal, by its duly authorized officer as of the day and year
first above written.
THE LIBERTY CORPORATION
By: ______________________________
Title:
Attest:
________________________
Title:
[CORPORATE SEAL]
-2-
<PAGE> 101
Term Note (cont'd)
TERM LOANS AND PAYMENTS OF PRINCIPAL
________________________________________________________________________________
<TABLE>
<CAPTION>
Type Amount Amount of
of Interest of Principal Maturity Notation
Date Loan* Rate Loan Repaid Date Made By
---- ----- ------- ------ --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
____________________________________________________________________________________________
</TABLE>
__________________________________
* i.e., a Base Rate or Euro-Dollar Loan.
-3-
<PAGE> 102
EXHIBIT A-4
SYNDICATED CONVERTIBLE LOAN NOTE
$_________________ Atlanta, Georgia
March 21, 1995
For value received, THE LIBERTY CORPORATION, a South Carolina
corporation (the "Borrower") promises to pay to the order of
______________________________________ (the "Bank"), for the account of its
Lending Office, the principal sum of ____________________ and No/100 Dollars
($___________) or such lesser amount as shall equal the unpaid principal amount
of each Syndicated Convertible 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 Convertible Loan Note on the dates
and at the rate or rates provided for 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, or such other address as
may be specified from time to time pursuant to the Credit Agreement.
All Syndicated Convertible 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, or any error of the Bank
in making, any such recordation or endorsement shall not affect the obligations
of the Borrower hereunder or under the Credit Agreement.
This note is one of the Syndicated Convertible Notes referred to
in the Credit Agreement dated as of March 21, 1995 among the Borrower, the
banks listed on the signature pages thereof and their successors and assigns
and Wachovia Bank of Georgia, N.A., as Agent (as the same may be amended or
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 prepayment and the repayment hereof
and the acceleration of the maturity hereof.
The Borrower hereby waives presentment, demand, protest, notice of
demand, protest and nonpayment and any other notice required by law relative
hereto, except to the extent as otherwise may be expressly provided for in the
Credit Agreement.
The Borrower agrees, in the event that this note or any portion
hereof is collected by law or through an attorney at law, to pay all reasonable
costs of collection, including, without limitation, reasonable attorneys' fees.
<PAGE> 103
IN WITNESS WHEREOF, the Borrower has caused this Syndicated
Convertible Loan Note to be duly executed under seal, by its duly authorized
officer as of the day and year first above written.
THE LIBERTY CORPORATION
By: ______________________________
Title:
Attest:
________________________
Title:
[CORPORATE SEAL]
<PAGE> 104
Syndicated Convertible Loan Note (cont'd)
SYNDICATED CONVERTIBLE LOANS AND PAYMENTS OF PRINCIPAL
________________________________________________________________________________
<TABLE>
<CAPTION>
Type Amount Amount of
of Interest of Principal Maturity Notation
Date Loan* Rate Loan Repaid Date Made By
---- ---- -------- ------ --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
</TABLE>
__________________________________
* i.e., a Base Rate or Euro-Dollar Loan.
-3-
<PAGE> 105
EXHIBIT A-5
MONEY MARKET CONVERTIBLE LOAN NOTE
$_________________ Atlanta, Georgia
March 21, 1995
For value received, THE LIBERTY CORPORATION, a South Carolina
corporation (the "Borrower") promises to pay to the order of___________________
_____________(the "Bank"), for the account of its Lending Office, the principal
sum of ______________________________and No/l00 Dollars ($___________) or such
lesser amount as shall equal the unpaid principal amount of each Money Market
Convertible 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 Money Market Convertible Loan Note on the dates and at the rate
or rates provided for 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, or such other address as may be specified
from time to time pursuant to the Credit Agreement.
All Money Market Convertible 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, or any error of the
Bank in making, any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Credit Agreement.
This Note is one of the Money Market Convertible Loan Notes
referred to in the Credit Agreement dated as of March 21, 1995 among the
Borrower, the banks listed on the signature pages thereof and their successors
and assigns and Wachovia Bank of Georgia, N.A., as Agent (as the same may be
amended or 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 prepayment and the
repayment hereof and the acceleration of the maturity hereof.
The Borrower hereby waives presentment, demand, protest, notice of
demand, protest and nonpayment and any other notice required by law relative
hereto, except to the extent as otherwise may be expressly provided for in the
Credit Agreement.
The Borrower agrees, in the event that this note or any portion
hereof is collected by law or through an attorney at law, to pay all reasonable
costs of collection, including, without limitation, reasonable attorneys' fees.
<PAGE> 106
IN WITNESS WHEREOF, the Borrower has caused this Money Market
Convertible Loan Note to be duly executed under seal, by its duly authorized
officer as of the day and year first above written.
THE LIBERTY CORPORATION
By: ______________________________
Title:
Attest:
__________________________
Title:
[CORPORATE SEAL]
-2-
<PAGE> 107
Money Market Convertible Loan Note (cont'd)
MONEY MARKET CONVERTIBLE LOANS AND PAYMENTS OF PRINCIPAL
________________________________________________________________________________
<TABLE>
<CAPTION>
Type Amount Amount of
of Interest of Principal Maturity Notation
Date Loan* Rate Loan Repaid Date Made By
---- ---- -------- ------ --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
</TABLE>
__________________________________
* i.e., a Base Rate or Euro-Dollar Loan.
-3-
<PAGE> 108
EXHIBIT B
OPINION OF
COUNSEL FOR THE BORROWER
To the Banks and the Agent
Referred to Below
c/o Wachovia Bank of North
Carolina, N.A., as Agent
400 South Tryon Street
P.O. Box 31608
Charlotte, North Carolina 28231
Dear Sirs:
I am General Counsel for The Liberty Corporation (the "Borrower")
and in such capacity I have represented the Borrower in connection with the
Credit Agreement (the "Credit Agreement") dated as of March 21, 1995 among the
Borrower, 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.
I have examined originals or copies, certified or otherwise
identified to my satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as I have deemed necessary or advisable
for purposes of this opinion. I have assumed for purposes of my 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.
As to questions of fact relating to the Borrower material to such opinions, I
have relied upon representations of appropriate officers of the Borrower.
Upon the basis of the foregoing, I am of the opinion that:
1. The Borrower is a corporation duly incorporated, validly
existing and in good standing under the laws of South Carolina and has all
corporate powers required to carry on its business as now conducted.
2. The execution, delivery and performance by the Borrower of the
Credit Agreement and the Notes (i) are within the 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 the Borrower or of any agreement, judgment, injunction, order, decree
or other instrument which to my knowledge is binding upon the Borrower and (v)
to my knowledge,
-1-
<PAGE> 109
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 constitutes a valid and binding agreement
of the Borrower, enforceable against the Borrower in accordance with its terms,
and the Notes constitute valid and binding obligations of the Borrower,
enforceable in accordance with their respective terms, except as such
enforceability may be limited: (i) by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and (ii) by general
principles of equity.
4. To my knowledge, there is no action, suit or proceeding
pending, or threatened, against or affecting the Borrower 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 Borrower 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 Borrower's Subsidiaries 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. The Borrower is not an "investment company" within the meaning
of the Investment Company Act of 1940, as amended.
I am qualified to practice in the State of South Carolina and do
not purport to be an expert on any laws other than the laws of the United
States and the State of South Carolina, and this opinion is rendered only with
respect to such laws. I have made no independent investigation of the laws of
any other jurisdiction.
I express no opinion as to the laws of any jurisdiction wherein
any Bank may be located which limits rates of interest which may be charged or
collected by such Bank other than in paragraph 3 with respect to the State of
South Carolina.
Very truly yours,
-2-
<PAGE> 110
EXHIBIT C
OPINION OF
WOMBLE CARLYLE SANDRIDGE & RICE, PLLC, SPECIAL COUNSEL
FOR THE AGENT
[Date 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
Dear Sirs:
We have participated in the preparation of the Credit Agreement
(the "Credit Agreement") dated as of March 21, 1995 among THE LIBERTY
CORPORATION, a South Carolina corporation (the "Borrower"), 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.
The Agent and Borrower have acknowledged that: (i) Womble Carlyle
Sandridge & Rice, PLLC has acted as counsel for the Agent in this transaction;
(ii) Womble Carlyle Sandridge & Rice, PLLC has represented the Borrower in
matters other than this transaction; and (iii) the Agent and Borrower have
waived any conflicts, potential or otherwise, which might arise from such
representation.
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.
-1-
<PAGE> 111
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, we are of the opinion that the Credit
Agreement constitutes a valid and binding agreement of the Borrower and each
Note constitutes valid and binding obligations of the Borrower, 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 and the Notes, 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,
Womble Carlyle Sandridge & Rice,
a Professional Limited Liability Company
By:____________________________
Manager
-2-
<PAGE> 112
EXHIBIT D
CLOSING CERTIFICATE
OF
THE LIBERTY CORPORATION
Reference is made to the Credit Agreement (the "Credit Agreement")
dated as of March 21, 1995, among The Liberty Corporation (the "Borrower"),
Wachovia Bank of Georgia, N.A., as Agent, and the Banks listed on the signature
pages thereof. 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 The Liberty
Corporation, hereby certifies to the Agent and the Banks that: (i) no Default
has occurred and is continuing on the date hereof; and (ii) the representations
and warranties of The Liberty Corporation contained in Article IV of the Credit
Agreement are true on and as of the date hereof.
Certified as of the 21st day of March, 1995.
THE LIBERTY CORPORATION
_____________________________________
Name:
<PAGE> 113
EXHIBIT E
THE LIBERTY CORPORATION
SECRETARY'S CERTIFICATE
The undersigned, ___________________, Secretary of The Liberty
Corporation, a South Carolina corporation (the "Borrower"), hereby certifies
that he has been duly elected, qualified and is acting in such capacity and
that, as such, he is familiar with the facts herein certified and is duly
authorized to certify the same, and hereby further certifies, in connection
with the Credit Agreement dated as of March 21, 1995 among the Borrower,
Wachovia Bank of Georgia, N.A., as Agent, and the Banks listed on the signature
pages thereof that:
1. Attached hereto as Exhibit A is a complete and correct copy of
the Certificate of Incorporation of the Borrower as in full force and effect on
the date hereof as certified by the Secretary of State of the State of South
Carolina, the Borrower's state of incorporation.
2. Attached hereto as Exhibit B is a complete and correct copy of
the Bylaws of the Borrower as in full force and effect on the date hereof.
3. Attached hereto as Exhibit C is a complete and correct copy of
the resolutions duly adopted by the Board of Directors of the Borrower on March
21, 1995 approving, and authorizing the execution and delivery of, the Credit
Agreement, the Notes (as such term is defined in the Credit Agreement) and the
other Loan Documents (as such term is defined in the Credit Agreement) to which
the Borrower is a party. Such resolutions have not been repealed or amended
and are in full force and effect, and no other resolutions or consents have
been adopted by the Board of Directors of the Borrower in connection therewith.
4. ______________________, who as Vice President and Chief
Financial Officer of the Borrower signed the Credit Agreement, the Notes and
the other Loan Documents to which the Borrower is a party, was duly elected,
qualified and acting as such at the time he signed the Credit Agreement, the
Notes and other Loan Documents to which the Borrower is a party, and his
signature appearing on the Credit Agreement, the Notes and the other Loan
Documents to which the Borrower is a party is his genuine signature.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as
of the 21 day of March, 1995.
________________________________
Name:
Title: Secretary
<PAGE> 114
EXHIBIT F
ASSIGNMENT AND ACCEPTANCE
Dated ________________ __, ____
Reference is made to the Credit Agreement dated as of March 21,
1995 (together with all amendments and modifications thereto, the "Credit
Agreement") among THE LIBERTY CORPORATION, a South Carolina corporation (the
"Borrower"), the Banks (as defined in the Credit Agreement) 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; (i) a ______% interest (which on the
Effective Date hereof is $_______________) in the Assignor's Revolving Credit
Commitment; (ii) a ______% interest (which on the Effective Date hereof is
$_______________) in the Assignor's Convertible Loan Commitment; and (iii) a
______% interest (which on the Effective Date hereof is $____________) in the
Assignor's Term Loan Commitment; and (a) a ______% interest (which on the
Effective Date hereof is $___________) in the Revolving Credit Advances owing
to the Assignor; (b) a _____% interest (which on the Effective Date hereof is
$____________) in the Convertible Loans owing to the Assignor; and (c) a
_______% interest (which on the Effective Date hereof is $__________) in the
Term Loans owing to Assignor; and (x) a ________% interest in the Revolving
Credit Note held by the Assignor (which on the Effective Date hereof is
$____________); (y) a _______% interest in the Convertible Loan Note held by
the Assignor (which on the Effective Date hereof is $___________); and (z) a
________% interest in the Term Note held by the Assignor (which on the
Effective Date hereof is $______________).
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, any other
instrument or document furnished pursuant thereto or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement, any other Loan Document 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 (a)
Revolving Credit Commitment is $_____________, (b) its Convertible Loan
Commitment is $___________, and (c) its Term Loan Commitment is $______________
(without giving effect to assignments thereof which have not yet become
effective) and the aggregate outstanding principal amount of (x) Revolving
Credit Advances owing to it is $______________, (y) Convertible Loans owing to
it is $____________, and (z) Term Loans
1
<PAGE> 115
owing to it is $_______________ (without giving effect to assignments thereof
which have not yet become effective); (ii) makes no representation or warranty
and assumes no 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, any other Loan Document or any other
instrument or document furnished pursuant thereto; and (iii) attaches the Notes
referred to in paragraph 1 above and requests that the Agent exchange such
Notes as follows: [a new Revolving Credit Note dated ___________, ____ in the
principal amount of $_______________ payable to the order of the Assignee] [new
Revolving Credit Notes as follows: a Revolving Credit Note dated
_________________, ____ in the principal amount of $_______________ payable to
the order of the Assignor and a Revolving Credit Note dated ______________,
____ in the principal amount of $______________ payable to the order of the
Assignee], [a new Convertible Loan Note dated _____________, 19___ in the
principal amount of $____________ payable to the order of the Assignee] [new
Convertible Loan Notes as follows: a Convertible Loan Note dated
_____________, 19___, in the principal amount of $____________ payable to the
order of the Assignor and a Convertible Loan Note dated ____________, 19___ in
the principal amount of $_______________ payable to the order of the Assignee],
[a new Term Note dated _____________, 19___ in the principal amount of
$____________ payable to the order of the Assignee] [new Term Notes as follows:
a Term Note dated _____________, 19___, in the principal amount of
$____________ payable to the order of the Assignor and a Term Note dated
____________, 19___ in the principal amount of $_______________ payable to the
order of the Assignee].
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[, and (viii) 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
2
<PAGE> 116
documents as are necessary to indicate that all such payments are subject to
such taxes at a rate reduced by an applicable tax treaty].*
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 Borrower]**, 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 Section 8.03
and Section 9.03 of the Credit Agreement) and be released from its obligations
as a Bank under the Credit Agreement.
6. Upon such execution and acceptance by the Agent [and execution
by the Borrower]**, 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:
__________________________________
*If the Assignee is organized under the laws of a jurisdiction outside the
United States.
**If the Assignee is not a Bank or an Affiliate of a Bank prior to the
Effective Date, or if no Default (as defined in the Credit Agreement) has
occurred and is continuing.
3
<PAGE> 117
[Address]
WACHOVIA BANK OF GEORGIA, N.A., as Agent
By:____________________________________
Title:
THE LIBERTY CORPORATION*
By:____________________________________
Title:
__________________________________
*If the Assignee is not a Bank or an Affiliate of a Bank prior to the
Effective Date, or if no Default has occurred and is continuing.
4
<PAGE> 118
EXHIBIT G
NOTICE OF BORROWING
__________, 19__
Wachovia Bank of Georgia, N.A., as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Re: Credit Agreement (as amended and modified from time to time,
the "Credit Agreement") dated as of March 21, 1995 by and
among The Liberty Corporation, 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 [Syndicated Revolving Credit
Advance] [Term Loan] [Syndicated Convertible Loan] in the aggregate principal
amount of $___________ to be made on ________, 19__, 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 to the
Euro-Dollar Loan shall be [1 month] [2 months] [3 months] [6 months]. This
borrowing shall constitute a [Syndicated Revolving Credit Borrowing] [Term Loan
Borrowing] [Syndicated Convertible Loan Borrowing].
The Borrower has caused this Notice of Borrowing to be executed
and delivered by its duly authorized officer this ___ day of ____, 199_.
THE LIBERTY CORPORATION
By:______________________
Title:
<PAGE> 119
EXHIBIT H
MONEY MARKET QUOTE REQUEST
[Date]
To: Wachovia Bank of Georgia, N.A.,
as Agent
From: The Liberty Corporation
Re: Money Market Quote Request
Pursuant to Section 2.03 of the Credit Agreement (the "Credit
Agreement") dated as of March 21, 1995, among The Liberty Corporation, the
banks listed on the signature pages thereof and Wachovia Bank of Georgia, N.A.,
as Agent, we hereby give notice that we request Money Market Quotes for the
following proposed Money Market Borrowing(s)
Date of Money Market Revolving Credit Borrowing or Money Market Convertible
Loan Borrowing:
Principal Amount* Interest Period**
---------------- ---------------
Terms used herein have the meanings assigned to them in the Credit
Agreement.
THE LIBERTY CORPORATION
By:________________________________
Title:
__________________________________
* Amount must be $5,000,000 or a larger multiple of $1,000,000.
** A period of 7 to 180 days.
<PAGE> 120
EXHIBIT I
MONEY MARKET QUOTE
Wachovia Bank of Georgia, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention:
Re: Money Market Quote to The Liberty Corporation (the "Borrower")
This Money Market Quote is given in accordance with Section
2.03(c)(ii) of the Credit Agreement (the "Credit Agreement") dated as of March
21, 1995, among The Liberty Corporation, the banks listed on the signature
pages thereof (the "Banks") 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 Borrower's invitation dated ____________ __,
19__, 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 Borrowing: 1*
4. We hereby offer to make Money Market Loan(s) in the following
minimum and maximum principal amounts, for the following Interest Periods and
at the following rates:
Minimum Maximum
Principal Principal Interest
Amount (2) Amount (2) Period (3) Interest Rate
------ ------ ------ -------------
__________________________
* All numbered footnotes appear on the last page of this Exhibit.
<PAGE> 121
We understand and agree that the offer(s) set forth above, subject
to the terms and 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 third sentence of Section
2.03(e) 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 Interest Period may not exceed
the principal amount requested. Bids must be made for at least $5,000,000 or a
larger multiple of $1,000,000.
(3) A period of 7 to 180 days.
-2-
<PAGE> 1
Exhibit 11
THE LIBERTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED EARNINGS PER SHARE COMPUTATION
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30,
------------------------------- -----------------------------
1995 1994 1995 1994
----------- ------------ ----------- -----------
(Unaudited)
<S> <C> <C> <C> <C>
PRIMARY SHARES
Common shares outstanding - end of period 19,981,581 19,796,207 19,981,581 19,796,207
Weighted average common shares
outstanding 19,914,315 19,734,355 19,883,476 19,628,092
Weighted average common stock options
outstanding 106,203 93,967 89,851 90,819
Preferred stock considered a common stock
equivalent 599,985 --- 403,324 ---
----------- ------------ ----------- -----------
Total primary shares 20,620,503 19,828,322 20,376,651 19,718,911
=========== ============ =========== ===========
FULLY DILUTED SHARES
Weighted average common shares
outstanding 19,914,315 19,734,355 19,883,476 19,628,092
Weighted average common stock options
outstanding 106,203 103,755 103,028 95,797
Preferred stock considered a common stock
equivalent 599,985 --- 403,324 ---
Assumed conversion of redeemable preferred
stock not considered a common stock
equivalent 1,265,708 1,266,863 916,089 753,163
----------- ------------ ----------- -----------
Total fully diluted shares 21,886,211 21,104,973 21,655,756 20,477,052
=========== ============ =========== ===========
NET INCOME $15,405,000 $14,600,000 $25,943,000 $25,173,000
=========== ============ =========== ===========
PREFERRED STOCK DIVIDENDS ON
REDEEMABLE PREFERRED STOCK
Dividends $ 665,000 $ 122,000 $ 1,330,000 $ 787,000
=========== ============ =========== ===========
Primary earnings per share (net income
minus preferred dividends divided by
total primary shares) $ 0.72 $ 0.70 $ 1.21 $ 1.24
=========== ============ =========== ===========
Fully diluted earnings per share (net income
divided by total fully diluted shares) $ 0.70 $ 0.69 $ 1.20 $ 1.23
=========== ============ =========== ===========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 7
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF THE LIBERTY CORPORATION FOR THE THREE MONTHS ENDED JUNE
30, 1995, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<DEBT-HELD-FOR-SALE> 1,044,850
<DEBT-CARRYING-VALUE> 292,512
<DEBT-MARKET-VALUE> 320,169
<EQUITIES> 79,861
<MORTGAGE> 195,032
<REAL-ESTATE> 143,698
<TOTAL-INVEST> 1,885,642
<CASH> 50,265
<RECOVER-REINSURE> 258,243
<DEFERRED-ACQUISITION> 360,233
<TOTAL-ASSETS> 2,867,639
<POLICY-LOSSES> 1,779,444
<UNEARNED-PREMIUMS> 0
<POLICY-OTHER> 22,944
<POLICY-HOLDER-FUNDS> 27,112
<NOTES-PAYABLE> 250,585
<COMMON> 156,493
45,755
21,000
<OTHER-SE> 333,643
<TOTAL-LIABILITY-AND-EQUITY> 2,867,639
168,754
<INVESTMENT-INCOME> 71,172
<INVESTMENT-GAINS> (2,694)
<OTHER-INCOME> 61,379
<BENEFITS> 124,757
<UNDERWRITING-AMORTIZATION> 20,647
<UNDERWRITING-OTHER> 59,662
<INCOME-PRETAX> 38,926
<INCOME-TAX> 12,983
<INCOME-CONTINUING> 25,943
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 25,943
<EPS-PRIMARY> 1.21
<EPS-DILUTED> 1.20
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 0
<CUMULATIVE-DEFICIENCY> 0
</TABLE>
