<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
[X] EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
[ ] EXCHANGE ACT OF 1934
For the transition period from __________________ to __________________
Commission file number 1-3122
Ogden Corporation
-------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-5549268
------------------------------------ ---------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
Two Pennsylvania Plaza, New York, New York 10121
----------------------------------------------------------------------
(Address or principal executive office) (Zip Code)
(212) 868-6100
----------------------------------------------------------------------
(Registrant's telephone number including area code)
Not Applicable
----------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by checkmark 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 |_|
APPLICABLE ONLY TO CORPORATE ISSUERS:
The number of shares outstanding of each of the issuer's classes of common
stock, as of March 31, 2000; 49,611,187 shares of Common Stock, $.50 par value
per share.
<PAGE>
PART 1. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED
MARCH 31,
----------------------
2000 1999
--------- ---------
(In Thousands of Dollars
Except Per Share Data)
<S> <C> <C>
Service revenues $ 204,165 $ 182,828
Net sales 9,629 13,031
Construction revenues 22,846 34,101
Net gain (loss) on sale of businesses (634) 4,864
--------- ---------
Total revenues 236,006 234,824
--------- ---------
Operating costs and expenses 157,522 135,559
Costs of goods sold 10,228 13,306
Construction costs 21,358 32,275
Selling, administrative and general expenses 21,337 19,305
Debt service charges 23,494 22,763
--------- ---------
Total costs and expenses 233,939 223,208
--------- ---------
Consolidated operating income 2,067 11,616
Equity in net income of investees and joint ventures 3,010 3,470
Interest income 973 2,095
Interest expense (9,458) (7,968)
Other income (deductions) - net (45) 66
--------- ---------
Income (loss) from continuing operations before income taxes,
minority interests and the cumulative effect of change in
accounting principle (3,453) 9,279
Income taxes 603 (3,004)
Minority interests (1,324) (2,216)
--------- ---------
Income (loss) from continuing operations (4,174) 4,059
Income (loss) from discontinued operations (net of income taxes
of: 2000, ($7,677) and 1999, $4,642) (25,310) 6,462
Cumulative effect of change in accounting principle
(net of income taxes of $1,313) (3,820)
--------- ---------
Net Income (Loss) (29,484) 6,701
--------- ---------
Other Comprehensive Income, Net of Tax:
Foreign currency translation adjustments (4,874) (6,205)
Unrealized Gains (Losses) on Securities:
Unrealized holding losses arising during period (17) (120)
--------- ---------
Other comprehensive income (4,891) (6,325)
--------- ---------
Comprehensive income (loss) $ (34,375) $ 376
========= =========
Basic Earnings Per Share:
Income (loss) from continuing operations $ (0.08) $ 0.08
Income (loss) from discontinued operations (0.51) 0.13
Cumulative effect of change in accounting principle (0.08)
--------- ---------
Net Income (Loss) $ (0.59) $ 0.13
========= =========
Diluted Earnings Per Share:
Income (loss) from continuing operations $ (0.08) $ 0.08
Income (loss) from discontinued operations (0.51) 0.13
Cumulative effect of change in accounting principle (0.08)
--------- ---------
Net Income (Loss) $ (0.59) $ 0.13
========= =========
</TABLE>
<PAGE>
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
----------- -----------
(In Thousands of Dollars)
<S> <C> <C>
Assets
Current Assets:
Cash and cash equivalents $ 80,223 $ 101,020
Restricted funds held in trust 118,025 103,662
Receivables (less allowances: 2000, $18,886 and 1999, $17,942) 252,800 294,051
Inventories 12,126 10,767
Deferred income taxes 36,189 36,189
Other 80,668 79,052
Net assets of discontinued operations 552,366 568,146
----------- -----------
Total current assets 1,132,397 1,192,887
Property, plant and equipment - net 1,833,704 1,841,811
Restricted funds held in trust 146,939 166,784
Unbilled service and other receivables 170,142 159,457
Unamortized contract acquisition costs 93,606 94,998
Goodwill and other intangible assets 12,284 12,520
Investments in and advances to investees and joint ventures 181,800 180,523
Other assets 71,878 78,168
----------- -----------
Total Assets $ 3,642,750 $ 3,727,148
=========== ===========
Liabilities and Shareholders' Equity
Liabilities:
Current liabilities:
Current portion of long-term debt $ 114,418 $ 113,815
Current portion of project debt 85,504 80,383
Accounts payable 70,104 75,169
Accrued expenses, etc 345,214 360,155
Deferred income 45,075 45,806
----------- -----------
Total current liabilities 660,315 675,328
Long-term debt 342,337 344,945
Project debt 1,361,057 1,390,832
Deferred income taxes 380,851 380,812
Deferred income 180,066 182,663
Other liabilities 125,236 127,559
Minority interests 34,030 33,309
Convertible subordinated debentures 148,650 148,650
----------- -----------
Total Liabilities 3,232,542 3,284,098
----------- -----------
Shareholders' Equity:
Serial cumulative convertible preferred stock, par value $1.00 per share;
authorized, 4,000,000 shares; shares outstanding: 37,127 in 2000 and
39,246 in 1999, net of treasury shares of 29,820 in 2000 and 1999 37 39
Common stock, par value $.50 per share; authorized, 80,000,000 shares;
shares outstanding: 49,611,187 in 2000 and 49,468,195 in 1999, net of
treasury shares of 4,290,195 and 4,405,103, respectively 24,806 24,734
Capital surplus 185,395 183,915
Earned surplus 225,681 255,182
Accumulated other comprehensive income (25,711) (20,820)
----------- -----------
Total Shareholders' Equity 410,208 443,050
----------- -----------
Total Liabilities and Shareholders' Equity $ 3,642,750 $ 3,727,148
=========== ===========
</TABLE>
<PAGE>
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEAR ENDED
MARCH 31, 2000 DECEMBER 31, 1999
SHARES AMOUNTS SHARES AMOUNTS
------------ --------- ----------- --------
(In thousands of dollars, except per-share amounts)
<S> <C> <C> <C> <C>
Serial Cumulative Convertible Preferred
Stock, Par Value $1.00 Per Share;
Authorized, 4,000,000 Shares:
Balance at beginning of period 69,066 $ 69 72,038 $ 73
Shares converted into common stock (2,119) (2) (2,972) (4)
------------ --------- ----------- --------
Total 66,947 67 69,066 69
Treasury shares (29,820) (30) (29,820) (30)
------------ --------- ----------- --------
Balance at end of period (aggregate
involuntary liquidation value -
2000, $748) 37,127 37 39,246 39
------------ --------- ----------- --------
Common Stock, Par Value $.50 Per Share;
Authorized, 80,000,000 Shares:
Balance at beginning of period 53,873,298 26,937 53,507,952 26,754
Exercise of stock options 155,801 78
Shares issued for acquisition 15,390 8 191,800 96
Conversion of preferred shares 12,658 6 17,745 9
------------ --------- ----------- --------
Total 53,901,346 26,951 53,873,298 26,937
------------ --------- ----------- --------
Treasury shares at beginning of period 4,405,103 2,203 4,561,963 2,281
Purchase of treasury shares 102,000 51
Issuance of restricted stock (114,944) (58)
Exercise of stock options (258,860) (129)
------------ --------- ----------- --------
Treasury shares at end of period 4,290,159 2,145 4,405,103 2,203
------------ --------- ----------- --------
Balance at end of period 49,611,187 24,806 49,468,195 24,734
------------ --------- ----------- --------
Capital Surplus:
Balance at beginning of period 183,915 173,413
Exercise of stock options 8,061
Issuance of restricted stock 1,312
Shares issued for acquisition 172 4,904
Purchase of treasury shares (2,458)
Conversion of preferred shares (4) (5)
--------- --------
Balance at end of period 185,395 183,915
--------- --------
Earned Surplus:
Balance at beginning of period 255,182 367,984
Net income (loss) (29,484) (81,961)
--------- --------
Total 225,698 286,023
--------- --------
Preferred dividends - per share 2000, $.46875,
and 1999, $3.35 17 137
Common dividends - per share 1999, $.625 30,704
--------- --------
Total Dividends 17 30,841
--------- --------
Balance at end of period 225,681 255,182
--------- --------
Cumulative Translation Adjustment - Net (25,537) (20,663)
--------- --------
Minimum Pension Liability Adjustment (307) (307)
--------- --------
Net Unrealized Gain on Securities Available
For Sale 133 150
--------- --------
TOTAL SHAREHOLDERS' EQUITY $ 410,208 $443,050
========= ========
</TABLE>
<PAGE>
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED
MARCH 31,
----------------------
2000 1999
--------- ---------
(In Thousands of Dollars)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (29,484) $ 6,701
Adjustments to Reconcile Net Income (Loss) to Net Cash
Provided by Operating Activities of Continuing Operations:
(Income) Loss from discontinued operations 25,310 (6,462)
Depreciation and amortization 25,013 20,181
Deferred income taxes 42 4,969
Cumulative effect of change in accounting principle 3,820
Other (1,809) (10,367)
Management of Operating Assets and Liabilities:
Decrease (Increase) in Assets:
Receivables 22,785 (5,246)
Inventories (1,512) 1,627
Other assets (1,754) 2,724
Increase (Decrease) in Liabilities:
Accounts payable (3,398) 13,023
Accrued expenses (11,766) 4,962
Deferred income 1,146 (489)
Other liabilities (9,478) (27,160)
--------- ---------
Net cash provided by operating activities of continuing operations 15,095 8,283
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of businesses 4,848 9,760
Proceeds from sale of property, plant and equipment 130
Proceeds from sale of marketable securities available for sale 3,574 25,934
Entities purchased, net of cash acquired (59,924)
Investments in facilities (10,873) (4,170)
Other capital expenditures (4,188) (3,813)
Distributions from investees and joint ventures 4,137 6,120
Increase in investments in and advances to investees and joint ventures (2,284) (14,834)
--------- ---------
Net cash used in investing activities of continuing operations (4,786) (40,797)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings for facilities 55,766
Other new debt 652 18,659
Decrease (increase) in funds held in trust 5,483 (35,084)
Payment of debt (83,037) (12,311)
Dividends paid (17) (15,400)
Purchase of treasury shares (2,509)
Proceeds from exercise of stock options 424
Other (603) (782)
--------- ---------
Net cash used in financing activities of continuing operations (21,756) (47,003)
--------- ---------
Net cash used in discontinued operations (9,350) (10,302)
--------- ---------
Net Decrease in Cash and Cash Equivalents (20,797) (89,819)
Cash and Cash Equivalents at Beginning of Period 101,020 181,169
--------- ---------
Cash and Cash Equivalents at End of Period $ 80,223 $ 91,350
========= =========
</TABLE>
<PAGE>
ITEM 1 - BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-Q and, therefore, do not
include all information and footnotes necessary for a fair presentation
of financial position, results of operations, and cash flows in conformity
with generally accepted accounting principles. However, in the opinion of
Management, all adjustments consisting of normal recurring accruals necessary
for a fair presentation of the operating results have been included in the
statements.
On January 1, 1999 Ogden Corporation (hereinafter together with its consolidated
subsidiaries referred to as "Ogden" or the "Company") adopted the American
Institute of Certified Public Accountants Statement of Position (SOP) 98-5
"Reporting on the Costs of Start-Up Activities". This SOP established accounting
standards for these costs and requires they generally be expensed as incurred.
The effect of the adoption of this SOP was a charge of $3,820,000 net of income
taxes of $1,313,000 recorded as a cumulative effect of change in accounting
principle in the accompanying financial statements.
The accompanying financial statements for the prior period have been
reclassified as to certain amounts to conform with the 2000 presentation.
DISCONTINUED OPERATIONS:
On September 29, 1999, the Board of Directors of the Company approved a plan to
dispose of all of the operations of the Entertainment and Aviation segments and
to report the results of operations from those segments prospectively as
Discontinued Operations. Information for two segments previously reflected under
the segment headings "Energy" and "Other" are now reported as Continuing
Operations and will continue to be reported under those headings. At March 31,
2000, the Company had approximately $552,000,000 in net assets associated with
its discontinued operations. In addition, the Company had associated debt with
respect to the discontinued operations of approximately $140,000,000. Since
September 29, 1999 the Company has retained financial advisors to assist it in
determining how best to group the assets to maximize sales proceeds. As part of
that process, on May 12, 2000 the Company closed its previously announced
transaction for the sale of its Themed Parks and Attractions, other than its
Jazzland theme park, which it expects to close within the next thirty days.
Further, the Company expects to close the sale of substantially all of
its Food and Beverage/Venue Management business within the next thirty days.
The Company received second round bids for its Aviation business on
May 11, 2000, and is currently evaluating how to maximize the sales proceeds of
those assets based on the bids received. The Company is in various stages with
respect to the disposition of a number of other assets included within
discontinued operations. Finally, certain aspects of the businesses will require
the Company to pay monies to terminate leases or cancel other contractual
commitments. Based upon the anticipated results of the sales processes, gains
and losses on disposal of portions of the discontinued operations will be
deferred until substantially all assets of the discontinued operations have been
sold. At March 31, 2000, the Company has deferred a total of $658,000 in net
gains on sales of assets of discontinued operations. Also, for the three months
ended March 31, 2000, the Company accrued
1
<PAGE>
approximately $18,000,000 representing estimated pretax net operating losses of
its discontinued operations through their respective anticipated dates of
disposal. The Company believes that it will receive net proceeds equal to or in
excess of its carrying value of net assets of its discontinued operations.
Net sales and income (loss) from discontinued operations are as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31
--------------------------
2000 1999
--------- ---------
(In Thousands of Dollars)
<S> <C> <C>
Revenues $ 155,605 $ 161,722
========= =========
Income (Loss) Before Income Taxes
and Minority Interests (33,033) 10,841
Provision (Benefit) for Income Taxes (7,677) 4,642
Minority Interests (46) (263)
--------- ---------
Income (Loss) from Discontinued
Operations $ (25,310) $ 6,462
========= =========
</TABLE>
Net assets of discontinued operations were as follows:
<TABLE>
<CAPTION>
MARCH 31, 2000 DECEMBER 31, 1999
-------------- -----------------
(In Thousands of Dollars)
<S> <C> <C>
Current Assets $ 218,010 $ 221,200
Property, Plant and Equipment - Net 368,275 375,211
Other Assets 332,284 336,700
Notes Payable, and Current Portion of
Long-Term Debt (45,545) (51,081)
Other Current Liabilities (170,027) (142,327)
Long-Term Debt (94,188) (108,681)
Other Liabilities (56,443) (62,876)
--------- ---------
Net Assets of Discontinued Operations $ 552,366 $ 568,146
========= =========
</TABLE>
2
<PAGE>
SPECIAL CHARGES:
As a result of the Company's Board of Directors' plan to dispose of its Aviation
and Entertainment businesses and close its New York City headquarters, and its
plan to exit other noncore businesses, the Company incurred various expenses in
1999 which were recognized in its continuing and discontinued operations. Of
those charges, certain cash charges related to severance costs, mainly for its
New York City employees, and contract termination costs of its former Chairman
and Chief Executive Officer were not fully paid. The following is a summary of
those costs and related payments during the three months ended March 31, 2000
(expressed in thousands of dollars):
<TABLE>
<CAPTION>
ADDITIONAL
PROVISIONS AMOUNTS PAID
DURING THREE DURING THREE
BALANCE AT MONTHS ENDED MONTHS ENDED BALANCE AT
DECEMBER 31,1999 MARCH 31, 2000 MARCH 31, 2000 MARCH 31, 2000
---------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Severance for approximately
230 employees $40,400 $1,200 $4,100 $37,500
Contract termination settlement 15,700 1,300 14,400
------- ------ ------ -------
$56,100 $1,200 $5,400 $51,900
======= ====== ====== =======
</TABLE>
The additional provisions for the three months ended March 31, 2000 were
comprised of $300,000 for continuing operations and $900,000 for discontinued
operations.
3
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OPERATIONS:
Revenues and income (loss) from continuing operations (expressed in thousands of
dollars) by segment for the three months ended March 31, 2000 and 1999 were as
follows:
<TABLE>
<CAPTION>
Three Months Ended March 31,
Information Concerning Business Segments 2000 1999
- -------------------------------------------------------------------------------------------------
(In Thousands of Dollars)
<S> <C> <C>
Revenues:
Energy $ 222,168 $ 217,068
Other 13,838 17,756
--------- ---------
$ 236,006 $ 234,824
========= =========
Income (Loss) from Operations:
Energy $ 10,218 $ 16,814
Other (2,611) (1,275)
--------- ---------
Total Income from Operations 7,607 15,539
Equity in net income of investees and joint ventures:
Energy 3,010 3,470
--------- ---------
Total 10,617 19,009
Corporate unallocated income and expenses - net (5,585) (3,857)
Interest - net (8,485) (5,873)
--------- ---------
Income (loss) from continuing operations before income taxes, minority
interests and the cumulative effect of change in accounting principle $ (3,453) $ 9,279
========= =========
</TABLE>
CONTINUING OPERATIONS: Revenues for the first three months of 2000 were
$1,200,000 higher than the comparable period of 1999 primarily reflecting an
increase in the Energy segment revenues of $5,100,000. Increases in the
Energy segment's revenues of $21,300,000 were primarily due to new plants in
Thailand ($9,400,000) and The Philippines ($3,500,000) that began operations
subsequent to the first quarter of 1999, the acquisition of an additional 50%
interest in a power plant in California in June of 1999 ($4,300,000) and
increases at several waste-to-energy facilities primarily the Tulsa, Oklahoma
facility ($1,500,000) reflecting a renegotiated service agreement that became
effective in April of 1999, an increase in the Union County, New Jersey
facility ($1,000,000) due to an increase in energy revenues, with the
remaining increase ($1,600,000) primarily attributed to contractual annual
escalation adjustments at various other facilities. These increases were
partially offset by a gain in the comparable period of 1999 of $4,900,000 on
the sale of the Company's interest in a joint venture in Maine, as well as
reduced construction revenues of $11,300,000 reflecting a decrease in civil
construction activity ($8,600,000) due to the completion of some projects in
1999 and a decrease
4
<PAGE>
in retrofit activity ($4,000,000) partially offset by an increase in water
and wastewater construction ($1,300,000). In 1999, the Company adopted a plan
to sell its environmental consulting and engineering business and to
discontinue its civil construction projects. Management anticipates that the
remaining construction projects will be completed during 2000, with the
exception of one project that is expected to continue into 2001. Therefore,
the Company anticipates a continued decline in civil construction activity
during 2000 as projects are completed. In addition, retrofit construction
activity will also decline, as facilities attain compliance with the Clean
Air Act Amendments of 1990 which is mandated by the end of 2000. These
increases in the Energy segment's revenues were offset by lower revenues of
$3,900,000 in the Other segment primarily due to reduced activity in
Datacom's operations chiefly associated with the Chapter XI bankruptcy filing
in March 2000 of Genicom Corporation, its major customer, and a $600,000 loss
on the sale of Applied Data Technology, Inc. (ADTI) at the end of March 2000.
Consolidated operating income for the first three months of 2000 was $9,500,000
lower than the comparable period of 1999. The Energy segment's income from
operations was $6,600,000 lower chiefly associated with a gain of $4,900,000
recognized in the comparable period in 1999 on the sale of the Company's
interest in a joint venture in Maine, additional depreciation expense of
$1,800,000 in connection with shortened estimated useful lives of certain air
pollution control equipment resulting from the Clean Air Act Amendments, and
increased overhead expenses of $1,600,000 relating to the expansion of the power
business, as well as a decrease in operating income from construction of
$400,000. These decreases were partially offset by net increases in operating
income of $2,100,000 from several projects including new plants that became
operational subsequent to the comparable period in 1999. In addition, the Other
segment's income from operations was $1,300,000 lower primarily due to lower
activity at Datacom, chiefly associated with the Chapter XI bankruptcy filing in
March 2000 of Genicom ($1,200,000), as well as the loss on the sale of ADTI in
the first quarter ($600,000).
Selling and administrative expenses were $2,000,000 higher primarily
associated with increased overhead costs related to international office
expansion for the Energy segment and increased corporate severance and
overhead costs. Debt service charges increased approximately $700,000
compared with the comparable period of 1999 due mainly to higher project debt
associated with new projects. The Energy segment has one interest rate swap
agreement entered into as a hedge against interest rate exposure on
adjustable-rate project debt that resulted in additional debt service expense
of $400,000 and $700,000 for the periods ended March 31, 2000 and 1999,
respectively.
Interest income for the first three months of 2000 was $1,100,000 lower than the
comparable period of 1999 primarily reflecting lower cash balances available for
investments.
Interest expense was $1,500,000 higher chiefly associated with increased
borrowings on the Company's revolving line of credit and higher interest rates
on adjustable rate debt.
5
<PAGE>
In addition, the Company had one swap agreement covering a notional amount of
$1,200,000 which converted the Entertainment segment's $1,200,000 variable rate
debt to a fixed rate, and expires November 30, 2000. Additional interest expense
relating to this swap agreement was not significant for the three-month periods
ended March 31, 2000 and 1999.
Equity in net income of investees and joint ventures decreased by $500,000
primarily reflecting the effect of a settlement in the comparable period of
1999 with a customer amounting to $1,600,000, offset by a net increase in 2000
in earnings of $1,100,000 due to increased generation on existing projects
($900,000) and income related to a new project that became operational during
the third quarter of 1999 ($200,000).
The effective income tax rate for the three months ended March 31, 2000 was
17.5% compared with 32.4% for 1999. This decrease in the effective rate was
primarily due to higher foreign income taxed at rates lower than the Federal
statutory rate and the effect of energy tax credits.
DISCONTINUED OPERATIONS: Loss from discontinued operations for the first
three months of 2000 was $25,300,000, a decrease in earnings of $31,800,000
from the comparable period of 1999. Operating income (loss) of discontinued
operations was ($30,500,000) in the first three months of 2000 compared to
$11,000,000 in the same period of 1999. This $41,500,000 change was chiefly
associated with a decrease of $30,500,000 in income from operations of the
Entertainment segment, primarily reflecting a provision of $18,700,000 for
estimated pretax net operating losses from April 1, 2000 through the
anticipated dates of sales of the businesses. In addition, Entertainment had
a decrease of $11,800,000 in income from operations primarily reflecting a
gain of $6,000,000 in 1999 on the renegotiation of a revised management
contract at Arrowhead Pond, increased legal, accounting, and consulting
expenses, and additional depreciation expense in connection with shortened
estimated useful lives of management information systems ending on the
expected dates of disposition of the businesses plus the related transition
period, as well as overhead costs in connection with the discontinuance of
the businesses of $5,200,000 and start-up costs of $2,800,000 at the Water
Parks and Jazzland theme park. These decreases were partially offset by a net
increase of $3,800,000 in sports and convention centers and venue management
activity. The Aviation segment's income from operations was $11,000,000 lower
primarily reflecting a $4,000,000 gain on the sale of an ownership interest
in the Hong Kong ground services company and an insurance recovery of
$1,500,000, both occurring in 1999; lower fueling and ground service income
of $2,800,000 reflecting lower customer activity; and increased legal,
accounting, consulting and overhead costs of $4,100,000 in connection with
the discontinuance of the business.
CAPITAL INVESTMENTS AND COMMITMENTS: For the three months ended March 31, 2000,
capital investments for continuing operations amounted to $15,100,000, of which
$14,900,000 was for Energy and $200,000 was for Other operations.
At March 31, 2000, capital commitments for continuing operations amounted to
$10,000,000 for normal replacement and growth in Energy. Other capital
commitments for Energy as of March 31, 2000 amounted to approximately
$100,500,000. This amount
6
<PAGE>
includes a commitment to pay, in 2008, $10,600,000 for a service contract
extension at an energy facility. In addition, this amount includes $28,000,000
for a 50% interest in a project in Thailand; $27,200,000 and $15,300,000,
respectively, for two oil-fired projects in India; $3,400,000 for additional
equity commitments related to a coal-fired power project in the Philippines;
$2,200,000 for a mass-burn waste-to-energy facility in Italy; and $13,800,000
for standby letters of credit in support of debt service reserve requirements.
Funding for the additional mandatory equity contributions to the coal-fired
power project in the Philippines is being provided through bank credit
facilities, which are due to be repaid in 2000. In addition, compliance with the
standards and guidelines under the Clean Air Act Amendments of 1990 will require
further Energy capital expenditures of approximately $20,000,000 through
December 2000, subject to the final time schedules determined by the individual
states in which the Company's waste-to-energy facilities are located.
Commitments for Discontinued Operations amounted to $21,200,000 for normal
replacement and growth in Aviation ($200,000) and Entertainment ($21,000,000),
the latter relating primarily to Entertainment's Jazzland theme park in New
Orleans, Louisiana. As part of its agreement to sell its themed attractions, the
Company has agreed to complete the construction of the Jazzland theme park.
Ogden and certain of its subsidiaries have issued or are party to performance
bonds and guarantees and related contractual obligations undertaken mainly
pursuant to agreements to construct and operate certain waste-to-energy,
entertainment, and other facilities. In the normal course of business, they are
involved in legal proceedings in which damages and other remedies are sought.
Management does not expect that these contractual obligations, legal
proceedings, or any other contingent obligations incurred in the normal course
of business will have a material adverse effect on Ogden's Consolidated
Financial Statements.
The Company did not include its interests in either the Arrowhead Pond in
Anaheim, California or the Corel Centre near Ottawa, Canada as part of the sale
of its Venue Management business announced in March 2000. The Company manages
the Arrowhead Pond under a long-term contract. As part of this contract, the
Company is a party, along with the City of Anaheim, to a reimbursement agreement
in connection with a letter of credit in the amount of approximately
$120,000,000. Under the reimbursement agreement, the Company is responsible for
draws, if any, under the letter of credit caused by the Company's failure to
perform its duties under its management contract at that venue. The Company is
exploring alternatives for disposing of the Arrowhead Pond and Corel Centre,
discussed below, along with the related obligations.
During 1994, a subsidiary of Ogden entered into a 30-year facility management
contract at the Corel Centre pursuant to which it agreed to advance funds to a
customer, and if necessary, to assist the customer's refinancing of senior
secured debt incurred in connection with the construction of the facility. Ogden
is obligated to purchase such senior debt in the amount of $97,100,000 on
December 23, 2002, if the debt is not refinanced prior to that time. Ogden is
also required to repurchase the outstanding amount of certain subordinated
secured debt of such customer on December 23, 2002. At March 31, 2000, the
amount outstanding was $51,600,000. In addition, as of March 31, 2000, the
Company
7
<PAGE>
had guaranteed $3,400,000 of senior secured term debt of an affiliate and
principal tenant (the NHL Ottawa Senators) of this customer and had guaranteed
up to $3,400,000 of the tenant's secured revolving debt. Further, Ogden is
obligated to purchase $20,600,000 of the tenant's secured subordinated
indebtedness on January 29, 2004, if such indebtedness has not been repaid or
refinanced prior to that time. In October 1999, Ogden also agreed to advance a
secured loan to that tenant of up to approximately $8,400,000 if certain events
occur, of which $2,100,000 had been advanced at March 31, 2000. Separately,
Ogden has guaranteed approximately $3,600,000 of borrowings of a customer of
Metropolitan Entertainment Group, an Entertainment joint venture in which Ogden
has an equity interest. The Company expects this guarantee to be assumed by the
ultimate purchaser of this interest. Management does not expect that these
arrangements will have a material adverse effect on Ogden's Consolidated
Financial Statements.
LIQUIDITY/CASH FLOW: Net cash provided by operating activities of continuing
operations was $6,800,000 higher than the comparable period of 1999 primarily
reflecting a reduction in accounts receivable of $28,000,000, and a decrease of
$17,700,000 in other liabilities. These increases were partially offset by a
decrease in income from continuing operations of $8,200,000 and a reduction of
$33,100,000 in accrued expenses and accounts payable. Net cash used in investing
activities was $36,000,000 lower primarily relating to a decrease of $59,900,000
in entities purchased and a net decrease of $10,600,000 in distributions from
and investments in and advances to joint ventures. These decreases were
partially offset by lower proceeds from the sale of marketable securities of
$22,300,000, higher capital expenditures of $7,100,000 and lower proceeds from
the sale of businesses of $4,900,000. Net cash used in financing activities was
$25,200,000 lower primarily due to a decrease of $40,600,000 of funds held in
trust, a reduction of dividends paid of $15,400,000 and in the purchase of
treasury shares of $2,500,000. These decreases were partially offset by a net
decrease in outstanding debt of $33,000,000.
At March 31, 2000, the Company had approximately $127,000,000 in cash and cash
equivalents, of which $80,000,000 related to continuing operations. In addition,
the Company has a revolving credit facility, on which the Company had drawn
$50,000,000 at March 31, 2000. The Company has agreed with its credit providers
(including its revolving credit lenders and certain other banks that have
similar covenants in their respective facilities, collectively the "Credit
Providers"), to amend financial covenants requiring the Company to maintain
certain ratios with respect to its indebtedness as a percentage of its
capitalization, its interest coverage as a function of income from continuing
operations and its minimum shareholders' equity, effective to July 31, 2000.
These amendments were necessary as a result of the financial effects of the
Company's decision to place the Aviation and Entertainment segments in
discontinued operations and complete the sales of those units. It is likely that
these waivers will need to be extended past July 31, 2000. In addition, the
Credit Providers granted the Company permission to sell its Aviation and
Entertainment units, subject to certain minimum prices with respect to certain
of the assets. In addition, the lenders agreed to amend the revolving credit
agreement to permit the Company to retain the first $100,000,000 in cash
received from the asset sales and, in addition, provided the Company with a
$50,000,000 liquidity facility (in addition to currently outstanding amounts),
which facility is secured by certain assets of the Company. The Company has
agreed to place all cash proceeds received from the sales of the units in
8
<PAGE>
excess of $100,000,000 in a segregated account to be applied to pay down
existing debt. The Company has further agreed not to incur any indebtedness
other than that incurred under the revolving credit facility. In order to make
additional Energy investments other than certain specified permitted
investments, the Company will require a substantial majority of its Credit
Providers to consent to such investments. To the extent the $50,000,000
liquidity facility is drawn, such amounts will be required to be repaid by July
31, 2000. In consideration for these concessions, the Company paid or will pay
fees to the lending group of approximately $12,000,000.
On May 12, 2000 the Company closed its previously announced transaction for the
sale of its Themed Parks and Attractions, other than its Jazzland theme park,
which it expects to close within the next thirty days. Further, the Company
expects to close the sale of a substantial majority of its Food and
Beverage/Venue Management business within the next thirty days. The Company
received second round bids for its Aviation business on May 11, 2000, and is
currently evaluating how to maximize the sales proceeds of those assets based on
bids received. The Company also determined in the fourth quarter of 1999 to sell
all of the operations currently reflected in the "Other Segment" and decided to
sell its domestic Environmental Consulting business and its Spanish subsidiary,
and to wind down the operations of its civil construction business, all of which
are reported in its Energy segment. To that end, the Company closed the sale
transaction of its ADTI unit at the end of March 2000. Accordingly, the Company
expects to have sufficient proceeds to fund normal operations (including certain
permitted energy investments), and repay certain other indebtedness on or before
the maturity date. The Company continues to explore possible new credit
facilities and/or obtaining equity for such purposes, including discussions with
its existing Credit Providers.
Under certain agreements entered into by the Company, if the Company's
outstanding debt securities are no longer rated investment grade, the Company
may be required to post additional collateral or letters of credit. The failure
to post such letters could result in a forfeiture of certain contracts or could
result in a default under the agreements requiring the posting of such letters.
Such a default would also be a default under the Company's credit facilities.
With the consent of its Credit Providers, the Company could cash collateralize
these obligations or potentially utilize sales proceeds for such purpose;
alternatively, the Credit Providers could provide such letters directly, or the
Company could raise equity for such purpose. The Credit Providers have agreed to
work with the Company to explore solutions to this issue should it arise. In
addition, from June 2 through July 31, 2000, the Company will need to renew
certain letters of credit which have been issued by certain members of its
lending group. Failure to obtain the renewal of these letters of credit could
give rise to defaults pursuant to the terms of the underlying agreements.
The Company believes its recent agreement with its Credit Providers is
consistent with its prior stated intention of using the proceeds from the sales
of the Entertainment and Aviation businesses to pay down existing debt.
9
<PAGE>
ANY STATEMENTS IN THIS COMMUNICATION WHICH MAY BE CONSIDERED TO BE
"FORWARD-LOOKING STATEMENTS," AS THAT TERM IS DEFINED IN THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995, ARE SUBJECT TO CERTAIN RISK AND UNCERTAINTIES.
THE FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE
SUGGESTED BY ANY SUCH STATEMENTS INCLUDE, BUT ARE NOT LIMITED TO, THOSE
DISCUSSED OR IDENTIFIED FROM TIME TO TIME IN THE COMPANY'S PUBLIC FILINGS WITH
THE SECURITIES AND EXCHANGE COMMISSION AND MORE GENERALLY, GENERAL ECONOMIC
CONDITIONS, INCLUDING CHANGES IN INTEREST RATES AND THE PERFORMANCE OF THE
FINANCIAL MARKETS; CHANGES IN DOMESTIC AND FOREIGN LAWS, REGULATIONS, AND TAXES,
CHANGES IN COMPETITION AND PRICING ENVIRONMENTS; AND REGIONAL OR GENERAL CHANGES
IN ASSET VALUATIONS.
10
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company has various legal proceedings involving matters
arising in the ordinary course of business. The Company does not believe that
there are any pending legal proceedings, other than ordinary routine litigation
incidental to its business, to which the Company is a party or to which any of
its property is subject, the outcome of which would have a material adverse
effect on the Company's consolidated position or results of operation.
The Company's operations are subject to various Federal, state
and local environmental laws and regulations, including the Clean Air Act, the
Clean Water Act, the Comprehensive Environmental Response Compensation and
Liability Act (CERCLA) and Resource Conservation and Recovery Act (RCRA).
Although the Company's operations are occasionally subject to proceedings and
orders pertaining to emissions into the environment and other environmental
violations, the Company believes that it is in substantial compliance with
existing environmental laws and regulations.
In connection with certain previously divested operations, the
Company may be identified, along with other entities, as being among potentially
responsible parties responsible for contribution for costs associated with the
correction and remediation of environmental conditions at various hazardous
waste disposal sites subject to CERCLA. In certain instances the Company may be
exposed to joint and several liability for remedial action or damages. The
Company's ultimate liability in connection with such environmental claims will
depend on many factors, including its volumetric share of waste, the total cost
of remediation, the financial viability of other companies that also sent waste
to a given site and its contractual arrangement with the purchaser of such
operations.
The potential costs related to all of the foregoing matters and
the possible impact on future operations are uncertain due in part to the
complexity of government laws and regulations and their interpretations, the
varying costs and effectiveness of cleanup technologies, the uncertain level of
insurance or other types of recovery, and the questionable level of the
Company's responsibility.
Although the ultimate outcome and expense of any litigation,
including environmental remediation, is uncertain, the Company believes that the
following proceedings will not have a material adverse effect on the Company's
consolidated financial position or results of operations.
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<PAGE>
(a) Environmental Matters
(i) In an ongoing criminal investigation by the U.S. Department of
Justice Ogden has contested that the Company has criminal liability under the
Federal Clean Water Act as a result of a spill of aviation fuel from a holding
tank in October 1996 at a former tank farm operated by Ogden at Dulles
International Airport in Washington, D.C. The Department of Justice Attorney
offered to resolve this matter by means of a guilty plea to a misdemeanor under
the Clean Water Act. Ogden rejected that offer by letter dated December 16, 1999
and is cooperating with the government to seek a fair and reasonable solution.
(ii) In October 1990, Ogden Aviation Fueling Company of Virginia, Inc.
and Ogden Aviation Services, Inc. were served with a lawsuit entitled
"AIRFRANCE, ET. AL. V. OGDEN AVIATION FUELING COMPANY OF VIRGINIA, INC. AND
OGDEN AVIATION SERVICES, INC." (Circuit Ct., Fairfax Co., Index No. 183590) in
which certain of the airlines seek recovery of cleanup costs arising from a
spill of aviation fuel from a holding tank in October 1996 at the former tank
farm operated by Ogden at Dulles International Airport for which they reimbursed
Ogden. The plaintiffs include United Air Lines, Inc., the largest carrier that
operated out of Dulles in 1996, as well as nine other airlines - Air France,
America West Airlines, Inc., Austrian Airlines, British Airways PLC, Continental
Airlines, Inc., Lufthansa A.G., Northwest Airlines, Inc., United Parcel Service
Co., and Virgin Atlantic Airways, Ltd.
The suit claims damages in the amount of at least $731,149.76, plus
interest. This dollar amount reflects the portion of the spill cleanup paid by
the named plaintiffs. The suit alleges damages on two theories: (1) breach of
contract in that Ogden was not authorized under the contract to charge the
airlines spill related costs; and (2) equitable relief in that Ogden has been
unjustly enriched at the expense of the airlines.
Ogden Aviation Services, Inc. filed a motion to dismiss the complaint
on the grounds that it was never a party to the fuel service agreements. Ogden
Aviation Fueling Company of Virginia, Inc. filed a motion to dismiss the unjust
enrichment claim and answered the claim arising under the contract. Both motions
to dismiss were denied and the litigation will proceed. Ogden takes the position
that fuel spill clean up costs were properly charged back to the plaintiff
airlines pursuant to the terms of the controlling agreements and will defend its
position in this litigation.
(iii) Ogden New York Services, Inc. ("Ogden New York"), has resolved
all liabilities to the Port Authority of New York and New Jersey associated with
Ogden New York's operations at the Bulk and Satellite Tank Farms located at the
John F. Kennedy International Airport in New York, New York. Ogden New York has
reached an agreement in principle with the Port Authority under which it will
make an upfront payment of $1,000,000 with additional payments tied to the
extension of the lease totaling $1,200,000 from 1999 through 2008 ($200,000 for
first 4 years and $100,000 for remaining 4 years).
(iv) On January 4, 2000 and January 21, 2000, United Air Lines, Inc.
("United") and American Airlines, Inc. ("American) named Ogden New York in two
separate lawsuits filed in the Supreme Court of the State of New York. The
lawsuits seek judgment declaring that Ogden New York is responsible for
petroleum contamination at airport terminals formerly or currently leased by
United and American. Ogden New York moved to consolidate the two lawsuits on
April 27, 2000.
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<PAGE>
Both United and American allege that Ogden negligently caused
discharges of petroleum at the airport and that Ogden is obligated to indemnify
the airlines pursuant to the Fuel Services Agreements between Ogden and the
respective airline. United and American further allege that Ogden is liable
under New York's Navigation Law which imposes liability on persons responsible
for discharges of petroleum and under common law theories of indemnity and
contribution.
The United complaint is asserted against Ogden, American, Delta,
Northwest and American Eagle. United is seeking $1,540,000 in technical
contractor costs and $432,000 in legal expenses related to the investigation and
remediation of contamination at the airport, as well as a declaration that Ogden
and the airline defendants are responsible for all or a portion of future costs
that United may incur.
The American complaint, which is asserted against both Ogden and
United, sets forth essentially the same legal basis for liability as the United
complaint. American is seeking reimbursement of all or a portion of $4,600,000
allegedly expended in cleanup costs and legal fees it expects to incur to
complete an investigation and cleanup that it is conducting under an
administrative order with the State Department of Environmental Conservation.
The estimate of those sums alleged in the complaint is $70,000,000.
Ogden disputes the allegations and believes that the damages sought are
excessive in view of the Airlines' responsibility for the contamination under
their respective leases and permits with the Port Authority. On May 1, 2000
Ogden filed a motion to dismiss the complaints on the ground that the
controlling agreements limit the Airlines' recovery against Ogden to the
coverage afforded under Ogden's insurance policies.
(v) On December 23, 1999 Allied Services, Inc. was named as a third
party defendant in an action filed in the Superior Court of the State of New
Jersey. The third-party complaint alleges that Allied generated hazardous
substances to a reclamation facility known as the Swope Oil and Chemical Company
Site, and that contamination migrated from the Swope Oil Site to the Pennsauken
Landfill and surrounding areas.
Third-party plaintiffs seek contribution and indemnification from
Allied and over 90 other third-party defendants for costs incurred and to be
incurred to cleanup the Pennsauken landfill and surrounding areas.
As a result of uncertainties regarding the source and scope of
contamination, the large number of potentially responsible parties and the
varying degrees of responsibility among various classes of potentially
responsible parties, the Company's share of liability, if any, cannot be
determined at this time.
(vi) On January 12, 1998, the Province of Newfoundland filed an
Information Against Airconsol Aviation Services Limited ("Airconsol") alleging
that Airconsol violated provincial environmental laws in connection with a fuel
spill on or about January 14, 1997 at Airconsol's fuel facility at the Deer
Lake, Canada Airport. Airconsol contested the allegations and prevailed. The
Court voided the Information. The Crown has appealed the Court's decision. The
Company will continue to contest its alleged liability on appeal.
(vii) The Company and/or certain subsidiaries have been advised by
various authorities that they are responsible for investigation, remediation
and/or corrective action in connection with fueling operations at various
airports. Although the Company and/or its subsidiaries do not
II-3
<PAGE>
acknowledge any legal obligation to do so, the Company and/or its subsidiaries
are cooperating with the government agencies in each matter to seek fair and
reasonable solutions. In addition, the cost to the Company and/or its
subsidiaries to comply with applicable environmental laws and regulations is
generally reimbursed to the Company and/or its subsidiaries through the
airlines.
(b) Shareholder Litigation
On September 22, October 1, and October 12, 1999, complaints (the
"Complaints") denominated as class actions (the "Actions") were filed in the
United States District Court for the Southern District of New York against the
Company, the Company's former Chairman and Chief Executive, R. Richard Ablon,
and Robert M. DiGia (incorrectly identified in the Complaints as the Chief
Financial Officer and Senior Vice President of the Company). The Complaints,
which are largely identical to one another, are brought by alleged shareholders
of the Company and purport to assert claims under the federal securities laws.
In general, the Complaints allege that the Company and the individual defendants
disseminated false and misleading information during the period of March 11,
1999 through September 17, 1999 (the "Class Period") with respect to the
Company's intended reorganization plans and its financial condition. The
Complaints seek the certification of a class of all purchasers of Ogden
Corporation common stock during the Class Period. By order dated December 22,
1999, the Actions have been consolidated for all purposes and lead plaintiffs
and lead counsel have been appointed. On February 28, 2000 plaintiffs filed a
consolidated amended compliant (the "Amended Compliant"). The Amended Complaint
repeats the allegations made in the original complaints and adds new allegations
with respect to the timing of the reporting of certain losses experienced by
Ogden. In the Amended Complaint, Plaintiffs have added Raymond E. Dombrowski,
Jr., Ogden's Senior Vice President and Chief Financial Officer, as a defendant.
There has been no discovery in the Actions. While the Actions are at a very
early stage, the Company believes it has meritorious defenses to the allegations
made in the Complaints and intends to defend the Actions vigorously. On April
28, 2000 all defendants filed motion to dismiss the Actions, with prejudice.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
3 ARTICLES OF INCORPORATION AND BY-LAWS.
3.1 Ogden's Restated Certificate of Incorporation
as amended.*
3.2 Ogden's By-Laws, as amended through
April 8, 1998.*
4 INSTRUMENTS DEFINING RIGHTS OF SECURITY
HOLDERS.
4.1 Fiscal Agency Agreement between Ogden and
Bankers Trust Company, dated as of June 1,
1987, and Offering Memorandum dated June 12,
1987, relating to U.S. $85 million principal
amount of 6% Convertible Subordinated
Debentures Due 2002.*
II-4
<PAGE>
4.2 Fiscal Agency Agreement between Ogden and
Bankers Trust Company, dated as of October
15, 1987, and Offering Memorandum dated
October 15, 1987 relating to U.S. $75 million
principal amount of 5-3/4% Convertible
Subordinated Debentures Due 2002.*
4.3 Indenture dated as of March 1, 1992 from
Ogden Corporation to The Bank of New York,
Trustee, relating to Ogden's $100 million
principal amount of 9-1/4% Debentures due
2022.*
10 MATERIAL CONTRACTS
10.1 (a) U.S. $95 million Term Loan and
Letter of Credit and Reimbursement
Agreement among Ogden, Deutsche Bank
AG, New York Branch, and the signatory
Banks thereto, dated March 26, 1997.*
(b) Credit Agreement by and among Ogden,
The Bank of New York, as Agent, and
the signatory Lenders thereto dated
as of June 30, 1997.*
(i) Amendment No. 1 and Waiver No.
1 under Credit Agreement,
effective as of August 18,
1999.
(ii) Amendment No. 2 to Credit
Agreement, effective as of
December 20, 1999.
(iii) Amendment No. 3 to Credit
Agreement, effective as of
March 31, 2000.
10.2 Rights Agreement between Ogden Corporation
and Manufacturers Hanover Trust Company,
dated as of September 20, 1990.*
10.3 Executive Compensation Plans and Agreements.
(a) Ogden Corporation 1990 Stock Option
Plan Amended and Restated as of
January 19, 1994.*
(i) Amendment adopted and
effective as of September 18,
1997.*
(b) Ogden Corporation 1999 Stock
Incentive Plan Amended and Restated
as of January 1, 2000.*
(c) Ogden Services Corporation Select
Savings Plan Trust Amendment and
Restatement as of January 1, 1995.*
II-5
<PAGE>
(i) Amendment Number One to the
Ogden Services Corporation
Select Savings Plan, effective
January 1, 1998.*
(d) Ogden Corporation Restricted Stock
Plan and Restricted Stock
Agreement.*
(e) Ogden Corporation Restricted Stock
Plan for Non-Employee Directors and
Restricted Stock Agreement.*
(f) Ogden Corporation Core Executive
Benefit Program.*
(g) Ogden Projects Supplemental Pension
and Profit Sharing Plans.*
(h) Ogden Projects Core Executive
Benefit Program.*
(i) Ogden Corporation Executive
Performance Incentive Plan.*
(j) Ogden Key Management Incentive
Plan.*
10.4 Employment Agreements
(a) Employment Letter Agreement between
Ogden Corporation and Lynde H.
Coit, Senior Vice President and
General Counsel, dated March 1,
1999.*
(b) Employment Agreement between R.
Richard Ablon, President, Chairman
and C.E.O., and Ogden dated as of
January 1, 1998.*
(c) Separation Agreement between Ogden
and Philip G. Husby, Senior Vice
President and C.F.O., dated as of
September 17, 1998.*
(d) Employment Agreement between Scott
G. Mackin, Executive Vice President
and Ogden Corporation dated as of
October 1, 1998.*
(e) Employment Agreement between Ogden
Corporation and David L. Hahn,
Senior Vice President - Aviation,
dated December 1, 1995.*
(i) Letter Amendment to Employment
Agreement between Ogden
Corporation and David L. Hahn,
Senior Vice President -
Aviation effective as of
October 1, 1998.*
II-6
<PAGE>
(f) Employment Agreement between Ogden
Corporation and Rodrigo Arboleda,
Senior Vice President dated January
1, 1997.*
(i) Letter Amendment to Employment
Agreement between Ogden
Corporation and Rodrigo
Arboleda, Senior Vice
President, effective as of
October 1, 1998.*
(g) Employment Agreement between Ogden
Energy Group, Inc. and Bruce W.
Stone, dated May 1, 1999.*
(h) Employment Agreements between Ogden
and Jesus Sainz, Executive Vice
President, effective as of January
1, 1998.*
(i) Letter Amendment to Employment
Agreement between Ogden
Corporation and Jesus Sainz,
Executive Vice President,
effective as of October 1,
1998.*
(i) Employment Agreement between Peter
Allen, Senior Vice President, and
Ogden Corporation dated July 1,
1998.*
(j) Employment Agreement between Ogden
Corporation and Raymond E.
Dombrowski, Jr., Senior Vice
President and C.F.O., dated as of
September 21, 1998.*
11 Detail of Computation of Earnings Per Share
Applicable to Common Stock.
27 Financial Data Schedule (EDGAR Filing Only).
o Incorporated by reference as set forth in the Exhibit Index of this
Form 10-Q.
(b) Reports on Form 8-K
A Form 8-K Current Report dated March 29,
2000 was filed on April 3, 2000 and is
incorporated herein by reference.
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized.
OGDEN CORPORATION
(Registrant)
Date: May 22, 2000 By /s/ RAYMOND E. DOMBROWSKI, JR.
---------------------------------
Raymond E. Dombrowski, Jr.
Senior Vice President
and Chief Financial
Officer
Date: May 22, 2000 By: /s/ WILLIAM J. METZGER
--------------------------------
William J. Metzger
Vice President and
Chief Accounting Officer
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<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ----------- ----------------------- ------------------
<S> <C> <C>
3 ARTICLES OF INCORPORATION AND BY-LAWS.
3.1 Ogden's Restated Certificate of Incorporation Filed as Exhibit (3)(a) to Ogden's Form 10-K for
as amended. the fiscal year ended December 31, 1988 and
incorporated herein by reference.
3.2 Ogden By-Laws as amended. Filed as Exhibit 3.2 to Ogden's Form 10-Q for the
quarterly period ended March 31, 1998 and
incorporated herein by reference.
4 INSTRUMENTS DEFINING RIGHTS OF SECURITY HOLDERS
-----------------------------------------------
4.1 Fiscal Agency Agreement between Ogden and Filed as Exhibits (C)(3) and (C)(4) to Ogden's
Bankers Trust Company, dated as of June 1, 1987 Form 8-K filed with the Securities and Exchange
and Offering Memorandum dated June 12, 1987, Commission on July 7, 1987 and incorporated
relating to U.S. $85 million principal amount of herein by reference.
6% Convertible Subordinated Debentures Due 2002.
4.2 Fiscal Agency Agreement between Ogden and Filed as Exhibit (4) to Ogden's Form S-3
Bankers Trust Company, dated as of October 15, Registration Statement filed with the Securities
1987, and Offering Memorandum dated October and Exchange Commission on December 4, 1987,
15, 1987, relating to U.S. $75 million Registration No. 33-18875, and incorporated
principal amount of 5-3/4% Convertible herein by reference.
Subordinated Debentures Due 2002.
4.3 Indenture dated as of March 1, 1992 from Ogden Filed as Exhibit (4)(C) to Ogden's Form 10-K for
Corporation to The Bank of New York, Trustee, fiscal year ended December 31, 1991, and
relating to Ogden's $100 million principal incorporated herein by reference.
amount of 9-1/4% Debentures Due 2022.
10 MATERIAL CONTRACTS
10.1(a) U.S. $95 million Term Loan and Letter of Credit Filed as Exhibit 10.6 to Ogden's Form 10-Q for
and Reimbursement Agreement among Ogden, the the quarterly period ended March 31, 1997 and
Deutsche Bank AG, New York Branch, and the incorporated herein by reference.
signatory Banks thereto, dated March 26, 1997.
II-9
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<CAPTION>
EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ----------- ----------------------- ------------------
<S> <C> <C>
10.1(b) Credit Agreement among Ogden, The Bank of New Filed as Exhibit 10.1(i) to Ogden's Form 10-Q for
York, as Agent, and the signatory Lenders the quarterly period ended June 30, 1997 and
thereto, dated as of June 30, 1997. incorporated herein by reference.
(i) Amendment No. 1 and Waiver No. 1 under Transmitted herewith as Exhibit 10(b)(i).
Credit Agreement, effective as of
August 18, 1999.
(ii) Amendment No. 2 to Credit Agreement, Transmitted herewith as Exhibit 10(b)(ii).
effective as of December 20, 1999.
(iii) Amendment No. 3 to Credit Agreement,
effective as of March 31, 2000. Transmitted herewith as Exhibit 10(b)(iii).
10.2 Rights Agreement between Ogden Corporation and Filed as Exhibit (10)(h) to Ogden's Form 10-K for
Manufacturers Hanover Trust Company, dated as the fiscal year ended December 31, 1990 and
of September 20, 1990 and amended August 15, incorporated herein by reference.
1995 to provide The Bank of New York as successor agent.
10.3 EXECUTIVE COMPENSATION PLAN AND AGREEMENTS.
(a) (i) Ogden Corporation 1990 Stock Filed as Exhibit 10.6(b)(i) to Ogden's
Option Plan Amended and Restated Form 10-Q as for the quarterly period ended
as of January 19, 1994. September 30, 1994 and incorporated
herein by reference.
(ii) Amendment to the Ogden Corporation Filed as Exhibit 10.7(a)(ii) to Ogden's Form 10-K
1990 Stock Option Plan as Amended for fiscal period ended December 31, 1997 and
and Restated effective as of incorporated herein by reference.
September 18, 1997.
(b) Ogden Corporation 1999 Stock Filed as Exhibit 10.3(b)(i) to Ogden's Form 10-K
Incentive Plan Amended and for the fiscal year ended December 31, 1999 and
Restated as of January 1, 2000. incorporated herein by reference.
(c) Ogden Services Corporation Select Filed as Exhibit 10.7 (e) (i) to Ogden's Form
Savings Plan Trust Amendment and 10-K for the fiscal year ended December 31, 1994
Restatement as of January 1, 1995. and incorporated herein by reference.
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<PAGE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ----------- ----------------------- ------------------
<S> <C> <C>
(i) Amendment Number One to the Filed as Exhibit 10.7 (c)(ii) to Ogden's Form
Ogden Services Corporation 10-K for the fiscal year ended December 31, 1997
Select Savings Plan, and incorporated herein by reference.
effective January 1,
1998.
(d) Ogden Corporation Restricted Stock Filed as Exhibit 10.3(e)(i) to Ogden's Form 10-K
Plan and Restricted Stock Agreement. for the fiscal year ended December 31, 1999 and
incorporated herein by reference.
(e) Ogden Corporation Restricted Stock Filed as Exhibit 10.3 (e)(ii) to Ogden's Form
Plan for Non-Employee Directors and 10-K for the fiscal year ended December 31, 1999
Restricted Stock Agreement. and incorporated herein by reference.
(f) Ogden Corporation Core Executive Filed as Exhibit 10.8(q) to Ogden's Form 10-K for
Benefit Program. fiscal year ended December 31, 1992 and
incorporated herein by reference.
(g) Ogden Projects Supplemental Pension Filed as Exhibit 10.8(t) to Ogden's Form 10-K for
and Profit Sharing Plans. fiscal year ended December 31, 1992 and
incorporated herein by reference.
(h) Ogden Projects Core Executive Benefit Filed as Exhibit 10.8(v) to Ogden's Form 10-K for
Program. fiscal year ended December 31, 1992 and
incorporated herein by reference.
(i) Ogden Corporation Executive Filed as Exhibit 10.3(m) to Ogden's Form 10-K for
Performance Incentive Plan. the fiscal year ended December 31, 1999 and
incorporated herein by reference.
(j) Ogden Key Management Incentive Filed as Exhibit 10.7(p) to Ogden's Form 10-K for
Plan. the fiscal year ended December 31, 1997 and
incorporated herein by reference.
10.4 Employment Agreements
II-11
<PAGE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ----------- ----------------------- ------------------
<S> <C> <C>
(a) Employment Letter Agreement between Filed as Exhibit 10.4(a) to Ogden's Form 10-K for
Ogden Corporation and Lynde H. Coit, the fiscal year ended December 31, 1998 and
Senior Vice President and General incorporated herein by reference.
Counsel dated March 1, 1999.
(b) Employment Agreement between R. Filed as Exhibit 10.3(h) to Ogden's Form 10-Q for
Richard Ablon and Ogden dated as of the quarterly period ended June 30, 1998 and
January 1, 1998. incorporated herein by reference.
(c) Separation Agreement between Ogden Filed as Exhibit 10.8(c) to Ogden's Form 10-Q for
Corporation and Philip G. Husby, the quarterly period ended September 30, 1998 and
Senior Vice President and C.F.O., incorporated herein by reference.
dated as of September 17, 1998.
(d) Employment Agreement between Scott G. Filed as Exhibit 10.8(e) to Ogden's Form 10-Q for
Mackin, Executive Vice President, and the quarter ended September 30, 1998 and
Ogden Corporation dated as of October incorporated herein by reference.
1, 1998.
(e) Employment Agreement between Ogden Filed as Exhibit 10.8(i) to Ogden's Form 10-K for
Corporation and David L. Hahn, Senior fiscal year ended December 31, 1995 and
Vice President - Aviation, dated incorporated herein by reference.
December 1, 1995.
(i) Letter Amendment to Filed as Exhibit 10.8(f)(i) to Ogden's Form 10-Q
Employment Agreement between for the quarterly period ended September 30, 1998
Ogden Corporation and David and incorporated herein by reference.
L. Hahn, effective as of
October 1, 1998.
(f) Employment Agreement between Ogden Filed as Exhibit 10.8(j) to Ogden's Form 10-K for
Corporation and Rodrigo Arboleda, fiscal year ended December 31, 1996 and
Senior Vice President dated January 1, incorporated herein by reference.
1997.
(i) Letter Amendment to Filed as Exhibit 10.8(g)(i) to Ogden's Form 10-Q
Employment Agreement between for the quarterly period ended September 30, 1998
Ogden Corporation and Rodrigo and incorporated herein by reference.
Arboleda, Senior Vice
President, effective as of
October 1, 1998.
II-12
<PAGE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
- ----------- ----------------------- ------------------
<S> <C> <C>
(g) Employment Agreement between Ogden Filed as Exhibit 10.4(g) to Ogden's Form 10-K for
Energy Group, Inc. and Bruce W. Stone, fiscal year ended December 31, 1999 and
dated May 1, 1999. incorporated herein by reference.
(h) Employment Agreements between Ogden Filed as Exhibit 10.8(m) to Ogden's Form 10-K for
and Jesus Sainz, Executive Vice the fiscal year ended December 31, 1997 and
President, effective as of January 1, incorporated herein by reference.
1998.
(i) Letter Amendment to Filed as Exhibit 10.8(j)(i) to Ogden's Form 10-Q
Employment Agreement between for the quarter ended September 30, 1998 and
Ogden Corporation and Jesus incorporated herein by reference.
Sainz, Executive Vice
President, effective as of
October 1, 1998.
(i) Employment Agreement between Peter Filed as Exhibit 10.3(M)(1) to Ogden's Form 10-Q
Allen, Senior Vice President, and for the quarterly period ended June 30, 1998 and
Ogden Corporation dated July 1, 1998. incorporated herein by reference.
(j) Employment Agreement between Ogden Filed as Exhibit 10.4(m) to Ogden's Form 10-Q for
Corporation and Raymond E. Dombrowski, the quarter ended September 30, 1998 and
Jr., Senior Vice President and C.F.O., incorporated herein by reference.
dated as of September 21, 1998.
11 Ogden Corporation and Subsidiaries Detail of Transmitted herewith as Exhibit 11.
Computation of Earnings Per Share Applicable to
Common Stock.
27 Financial Data Schedule. Transmitted herewith as Exhibit 27.
</TABLE>
II-13
<PAGE>
EXHIBIT 10(b)(i)
AMENDMENT NO. 1 AND WAIVER NO. 1
UNDER CREDIT AGREEMENT
AMENDMENT NO. 1 AND WAIVER NO. 1 (this "AMENDMENT"), dated as of August
18, 1999, under the Credit Agreement (the "CREDIT AGREEMENT"), dated as of June
30, 1997, by and among OGDEN CORPORATION, a Delaware corporation (the
"BORROWER"), the Signatory Lenders party thereto (the "LENDERS") and THE BANK OF
NEW YORK, as Agent (the "AGENT").
RECITALS
A. Capitalized terms used herein which are not herein defined shall
have the respective meanings ascribed thereto in the Credit Agreement.
B. The Borrower has entered into an agreement to purchase the equity
interest of the PacifiCorp. in a entity that owns a power plant in the
Philippines.
C. One of the conditions to the closing of such purchase is that the
Borrower procure a standby letter of credit in the amount of $31,883,000 (the
"Philippines Letter of Credit").
D. The Borrower has requested that the L/C Issuing Bank issue the
Philippines Letter of Credit pursuant to the Credit Agreement.
E. To facilitate the Borrower's request, the Borrower has requested
that the Agent and the Lenders agree to (i) amend the Credit Agreement to
increase the Letter of Credit Sub-Facility from $30,000,000 to $33,000,000 and
(ii) waive compliance by the Borrower with the notice provisions of Section
2.20(b) of the Credit Agreement for the purposes of the issuance of the
Philippines Letter of Credit.
F. The Agent and the Lenders are willing to agree to the Borrower's
request subject to the terms and conditions set forth herein.
Accordingly, in consideration of the covenants, conditions and
agreements hereinafter set forth, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto
agree as follows:
1. Section 2.20(a) of the Credit Agreement is amended by deleting the
reference to "$30,000,000" contained in such section and replacing it with
"$33,000,000."
2. The Agent and the Lenders waive, for the purpose and only for the
purpose of the issuance of the Philippines Letter of Credit, compliance with the
provisions of Section 2.20(b) of the Credit Agreement requiring Borrower to
provide at least three (3) Business Days notice prior to the requested date of
the issuance of a Letter of Credit.
<PAGE>
3. The effectiveness of this Amendment and Waiver is subject to the
prior or simultaneous fulfillment of the following conditions:
(a) The Agent shall have received (i) this Amendment executed by a
duly authorized officer or officers of the Borrower and (ii) consents to this
Amendment and Waiver from the Required Lenders; and
(b) The Agent shall have received such other documents as it shall
have reasonably requested.
4. The Borrower hereby (i) reaffirms and admits the validity and
enforceability of the Credit Agreement and the other Loan Documents and all of
its obligations thereunder, (ii) represents and warrants that there exists no
Default or Event of Default, and (iii) represents and warrants that the
representations and warranties contained in the Credit Agreement as amended by
this Amendment (other than the representations and warranties made as of a
specific date) are true and correct in all material respects on and as of the
date hereof.
5. This Amendment and Waiver may be executed in any number of
counterparts, each of which shall be an original and all of which shall
constitute one agreement. It shall not be necessary in making proof of this
Amendment to produce or account for more than one counterpart signed by the
party to be charged.
6. This Amendment and Waiver is being delivered in and is intended to
be performed in the State of New York and shall be construed and enforceable in
accordance with, and be governed by, the internal laws of the State of New York
without regard to principles of conflict of laws.
7. Except as amended hereby, the Credit Agreement shall in all other
respects remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
and Waiver to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
-2-
<PAGE>
EXHIBIT 10(b)(ii)
AMENDMENT NO. 2
TO CREDIT AGREEMENT
AMENDMENT NO. 2 (this "AMENDMENT"), dated as of December 20, 1999, under
the Credit Agreement dated as of June 30, 1997, by and among OGDEN CORPORATION,
a Delaware corporation (the "COMPANY"), the Signatory Lenders party thereto (the
"LENDERS") and THE BANK OF NEW YORK, as Agent (the "AGENT") as amended by
Amendment No. 1 to Credit Agreement, dated as of August 18, 1999 (the "CREDIT
AGREEMENT).
RECITALS
I. Capitalized terms used herein which are not herein defined shall have
the respective meanings ascribed thereto in the Credit Agreement.
II. The Company has advised the Agent that:
(a) It has decided to sell certain businesses and/or assets.
(b) It will classify, for accounting purposes, the businesses described
in Schedule 1 annexed hereto as "discontinued operations" ("1999 DISCONTINUED
OPERATIONS").
(c) It anticipates that it will incur losses in the amounts specified
in Schedule 2 annexed hereto under the heading "Anticipated Write-Offs" (the
"1999 WRITE-OFFS") in connection with the sales and other events described in
Schedule 2.
(d) It anticipates it will be required to incur additional indebtedness
to finance the completion of construction of the Jazzland project, to fund
incremental interest expense of Ogden Energy and with respect to bridge loans
and purchase money loans, to fund expenses with respect to its insurance
programs and for general working capital purposes (the "1999 ADDITIONAL
INDEBTEDNESS").
III. The Company has also advised the Agent that the consummation of the
transactions and the occurrence of the events described in Recitals II (a), (b)
and (c) and the incurrence of the Indebtedness described in Recital II (d) may
result in the violation by the Company of one or more covenants of the Credit
Agreement.
IV. To facilitate the consummation of the transactions described in
Recitals II (a), (b) and (c) and to permit the Company to incur the indebtedness
described in Recital II (d), the Company has requested the Agent and the Lenders
agree to amend the Credit Agreement.
V. The Agent and the Lenders have advised the Company that they are willing
to agree to the Borrower's request subject to the terms and conditions set forth
herein.
<PAGE>
Accordingly, in consideration of the covenants, conditions and agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
as follows:
1. AMENDMENTS TO CREDIT AGREEMENT
1.1 Section 1.1 of the Credit Agreement is amended to add the following
defined terms in the appropriate alphabetical order:
"AMENDMENT NO. 2" means Amendment No. 2 to Credit Agreement, dated
as of December 17, 1999, among the Company, the Lenders party thereto and
the Agent.
"AMENDMENT NO. 2 EFFECTIVE DATE" means the date on which the
conditions set forth in Section 2.1 of Amendment No. 2 are satisfied.
"1999 ADDITIONAL INDEBTEDNESS" has the meaning ascribed to it in
Recital II (d) of Amendment No. 2 to Credit Agreement.
"1999 DISCONTINUED OPERATIONS": has the meaning ascribed to it in
Recital II (b) of Amendment No. 2 to Credit Agreement.
"1999 WRITE-OFFS": has the meaning ascribed to it in Recital II (c)
of Amendment No. 2 to Credit Agreement.
1.2 Section 1.1 of the Credit Agreement is amended by deleting in its
entirety the text of the defined term "OPERATING INCOME" and substituting
therefor the following:
"OPERATING INCOME" net income before income taxes and minority
interests of the Company and its Subsidiaries from continuing operations
and, for the purpose and only for the purpose of testing and determining
compliance with Section 8.9 of this Agreement (a) including income from
the 1999 Discontinued Operations, (b) excluding actual gains and losses
resulting from the disposition of Property made pursuant to Section
8.6(iv), (c) excluding amounts not to exceed (1) for each 1999 Write-Off
Event, the corresponding amount, pre-tax, set forth in the second column
of Schedule 2 to Amendment No. 2 to the Credit Agreement, (2) $100,000,000
in the aggregate for all 1999 Write-Offs Events and (d) write-offs
associated with the Richard Ablon litigation not to exceed $23,000,000 in
the aggregate.
1.1 Section 1.1 of the Credit Agreement is amended by deleting in its
entirety the text of the defined term "SHAREHOLDERS' EQUITY" and substituting
therefor the following:
"SHAREHOLDERS' EQUITY" all amounts which would, in conformity with
GAAP, be included under shareholders' equity on a Consolidated balance
sheet, PLUS, for the purpose and only for the purpose of determining and
testing compliance with Section 8.5 of this Agreement, actual losses when
incurred (according to GAAP) in respect of
<PAGE>
the 1999 Write-Offs, not to exceed (a) for each 1999 Write-Off Event, the
corresponding amount, after-tax, set forth in the third column of Schedule
2 to Amendment No. 2 to Credit Agreement and (b) $70,000,000 after-tax, in
the aggregate for all 1999 Write-Offs.
1.4 The Credit Agreement is amended to add the following Section 2.24:
"2.24 AVAILABILITY OF COMMITMENTS.
(a) The Company agrees that, notwithstanding any other provision of
this Agreement, during the period from the Amendment No. 2 Effective Date to and
including the date on which the Required Lenders, in their sole discretion,
agree to reinstate the availability of the Revolving Commitments and the Letter
of Credit Commitments (the "Availability Reinstatement Date") (a) the Company
shall not be entitled to request and the Lenders shall not be obligated to make
any additional Loans and (b) the Company shall not be entitled to request and
the Issuing Bank shall not be required to issue any additional Letters of
Credit.
(b) The Company and the Lenders agree that the limitation on the
availability of the Revolving Commitments and the Letter of Credit Commitments
set forth in Section 2.24(a) is not a termination or reduction of such
Commitments."
1.5 Section 8.4 of the Credit Agreement is amended to delete the words
"Sale of Property" from the heading of such section.
1.6 Section 8.5 of the Credit Agreement is amended to delete the text
thereof in its entirety and to substitute the following therefor:
"8.5 LEVERAGE RATIO
Permit its ratio of the sum of (i) Consolidated Indebtedness plus
(ii) Consolidated Contingent Obligations to the sum of (x) Consolidated
Indebtedness plus (y) Consolidated Contingent Obligations plus (z) the
Company's Shareholders' Equity to be greater than 0.650:1.0 at any time."
1.6 Section 8.6 of the Credit Agreement is amended to delete the text
thereof in its entirety and to substitute therefor the following:
"8.6 SALE OF PROPERTY
Sell, assign, exchange, lease, transfer or otherwise dispose of any
Property, whether now owned or hereafter acquired, to any Person, or
permit any Subsidiary so to do, except:
(i) dispositions to a Subsidiary for a consideration
at least equal to the fair value of the Property disposed of;
<PAGE>
(ii) dispositions by one Subsidiary to the Company or to
another Subsidiary;
(iii) (intentionally deleted);
(iv) dispositions of Property that result in proceeds
(irrespective of whether such proceeds are paid in cash or any other form)
to the Company (or other Person that is the seller of the Property) of not
more than $35,000,000 after payment of (1) any required closing costs and
expenses directly attributable to the sale of the Property ("Closing
Costs") and (2) any Indebtedness that is secured by the Property that is
being sold ("Sale Related Debt"), PROVIDED THAT, prior to the consummation
of any such sale, the Company shall have furnished the Agent a copy of the
agreement or contract for the sale for the applicable Property and a
statement setting forth, on a PRO FORMA basis, the total consideration to
be paid to the Company (or other seller) under the agreement or contract
for the sale for such Property and the estimated amount, if any, of the
Closing Costs and Sale Related Debt to be paid from the consideration for
the sale and the net proceeds of sale to be realized (by the Company or
other seller) from the sale after the deduction or payment of the Closing
Costs and Sale Related Debt (each a "Pro-Forma Sale Statement"), and
PROVIDED FURTHER that after the consummation of such sale, the Company
shall deliver to the Agent a statement indicating any variance between the
Pro Forma Sale Statement and the actual amount received and paid in
connection with such sale;
(v) the payment of dividends and distribution of Stock of the
Company in the ordinary course of business;
(vi) (intentionally deleted)."
1.6 Section 8.9 of the Credit Agreement is amended to delete the text
thereof in its entirety and to substitute the following therefor:
"8.9 FIXED CHARGE COVERAGE RATIO
Permit the Fixed Charge Coverage Ratio to be less than (a) 1.25 to
1.00 for the four fiscal quarters (taken as a whole) preceding December
31, 1999 and (b) thereafter, 1.50 to 1.00 for any preceding period of four
fiscal quarters (taken as a whole).
2. CONDITIONS TO EFFECTIVENESS OF AMENDMENT.
2.1 The effectiveness of this Amendment is subject to the prior or
simultaneous fulfillment of the following conditions:
(a) The Agent shall have received this Amendment executed by (i) a
duly authorized officer or officers of the Borrower and (ii) the Required
Lenders;
<PAGE>
(b) The Agent shall have received such other documents as it shall
have reasonably requested;
(c) The Agent shall have received payment of all of its
out-of-pocket expenses, including the reasonable fees and expenses of its
counsel incurred pursuant to the Credit Agreement through October 31, 1999 in
the amount of $18,375.00, plus any additional fees and expenses of counsel
incurred from November 1, 1999 and incurred in connection with this Amendment;
and
(d) The Agent shall have received the fees due to the Agent and the
Lenders pursuant to the letter agreements between the Agent and the Borrower.
2.2 The date on which the conditions set forth in Section 2.1 are
satisfied is the "AMENDMENT NO. 2 EFFECTIVE DATE."
3. ACKNOWLEDGMENTS AND REPRESENTATIONS AND WARRANTIES.
3.1 The Borrower hereby (a) reaffirms and admits the validity and
enforceability of the Credit Agreement and the other Loan Documents and all of
its obligations thereunder, (b) represents and warrants that there exists no
Default or Event of Default, and (c) represents and warrants that the
representations and warranties contained in the Credit Agreement as amended by
this Amendment (other than the representations and warranties made as of a
specific date) are true and correct in all material respects on and as of the
date hereof.
4. MISCELLANEOUS
4.1 This Amendment may be executed by facsimile and in any number of
counterparts, each of which shall be an original and all of which shall
constitute one agreement. It shall not be necessary in making proof of this
Amendment to produce or account for more than one counterpart signed by the
party to be charged.
4.2 This Amendment is being delivered in and is intended to be performed
in the State of New York and shall be construed and enforceable in accordance
with, and be governed by, the internal laws of the State of New York without
regard to principles of conflict of laws.
4.3 Except as amended hereby, the Credit Agreement shall in all other
respects remain in full force and effect.
[THE REMAINDER OF THE PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
<PAGE>
The parties hereto have caused this Amendment to be duly executed and delivered
by their proper and duly authorized officers as of the day and year first above
written.
<PAGE>
EXHIBIT 10(b)(iii)
AMENDMENT NO. 3
TO CREDIT AGREEMENT
AMENDMENT NO. 3 (this "AMENDMENT NO. 3"), dated as of March 31, 2000,
under the Credit Agreement dated as of June 30, 1997, by and among OGDEN
CORPORATION, a Delaware corporation (the "COMPANY"), the Signatory Lenders party
thereto (the "LENDERS") and THE BANK OF NEW YORK, as Agent (the "AGENT"), as
amended by Amendment No. 1 to Credit Agreement, dated as of August 18, 1999, and
Amendment No. 2 to Credit Agreement, dated as of December 20, 1999 (the "CREDIT
AGREEMENT").
RECITALS
I. Capitalized terms used herein which are not herein defined shall have
the respective meanings ascribed thereto in the Credit Agreement.
II. The Company has requested that the Agent and the Lenders (a) reduce
the Aggregate Commitments from $200,000,000 to $100,000,000, (b) amend the
Credit Agreement to create a secured revolving credit subfacility and (c) amend
the Credit Agreement in certain other respects.
III. The Agent and the Lenders have advised the Company that they are
willing to agree to the Company's request subject to the terms and conditions
set forth herein.
Accordingly, in consideration of the covenants, conditions and
agreements hereinafter set forth, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto
agree as follows:
1. AMENDMENTS TO CREDIT AGREEMENT -- GENERAL.
1.1 Section 1.1 of the Credit Agreement is hereby amended by adding
the following defined terms in the appropriate alphabetical order:
"AMENDMENT NO. 3": Amendment No. 3 to Credit Agreement, dated
as of March 31, 2000, among the Company, the Lenders party thereto and the
Agent.
"AMENDMENT NO. 3 EFFECTIVE DATE": the date on which the conditions
set forth in Section 3.1 of Amendment No. 3 are satisfied.
"CAPITAL EXPENDITURES": for any period, the sum of the aggregate of
all expenditures (paid in cash or for which the Company or any Subsidiary is
obligated as a result of the acquisition by the Company or such Subsidiary of
any fixed or capital asset during such period or the rendition of services to
the Company or such Subsidiary in respect of any fixed or capital asset) by the
Company and the Subsidiaries on a Consolidated basis
<PAGE>
during such period for fixed or capital assets (excluding any capitalized
interest and any such asset acquired in connection with normal replacement and
maintenance programs properly charged to current operations and excluding any
replacement assets acquired with the proceeds of insurance).
"COVENANT CREDIT FACILITIES": any loan agreement, loan document,
agreement or indenture that contains covenants (however designated, and
including negative, affirmative or financial covenants) which (a) require the
maintenance of minimum Shareholder's Equity (b) prescribe a Fixed Charge
Coverage Ratio, (c) prohibit or restrict the sale, assignment, transfer or
disposition of any Property of the Company or any Subsidiary or (d) restrict the
granting of the Lien granted in favor of the Agent pursuant to paragraph 2.27 or
require equivalent security over any Property or assets of the Company or any
Subsidiary, and which loan agreements, loan documents, agreements and indentures
are described on Schedule D to Amendment No. 3.
"CREDIT FACILITY INDEBTEDNESS": the Indebtedness of the Company and
its Subsidiaries described on Schedule C to Amendment No. 3 together with any
Hedging Agreement entered into in connection therewith.
"DISBURSEMENT ACCOUNT": the disbursement account maintained by the
Company at BNY in accordance with paragraph 2.25.
"DISPOSITION CLOSING COSTS": any required closing fees, costs and
expenses directly attributable to a Permitted Disposition.
"DISPOSITION RELATED DEBT": the debt that is secured by or related
to the Property sold in a Permitted Disposition as set forth on Schedule E to
Amendment No. 3.
"GUARANTEE": of or by any Person (the "GUARANTOR") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or in effect
guaranteeing any return on any investment made by another Person, or any
Indebtedness, lease, dividend or other obligation (a "PRIMARY OBLIGATION") of
any other Person (a "PRIMARY OBLIGOR") in any manner, whether directly or
indirectly, including any obligation of the guarantor, directly or indirectly
(i) to purchase any primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (A) for the purchase
or payment of any primary obligation or (B) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of a primary obligor, (iii) to purchase property, securities or
services primarily for the purpose of assuring the beneficiary of any primary
obligation of the ability of a primary obligor to make payment of a primary
obligation, (iv) otherwise to assure or hold harmless the beneficiary of a
primary obligation against loss in respect thereof and (v) in respect of the
liabilities of any partnership in which a secondary obligor is a general
partner, except to the extent that such liabilities of such partnership are
nonrecourse to such secondary obligor and its separate property, provided,
however, that the term "Guarantee" shall not include (x) the endorsement of
instruments for deposit or collection in the ordinary course of business or (y)
the indemnification provisions
2
<PAGE>
contained in the purchase agreements with respect to the Property described on
Schedules B-1, B-2 and B-3 to Amendment No. 3. The amount of any Guarantee shall
be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof as
determined by the guarantor in good faith.
"HEDGING AGREEMENT": any interest rate swap, cap or collar
arrangement or any other derivative product customarily offered by banks or
other financial institutions to their customers in order to reduce the exposure
of such customers to interest rate fluctuations.
"NET CASH PROCEEDS": cash proceeds received from a sale, assignment,
transfer or other disposition of Property minus (a) taxes paid or payable in
cash in connection therewith at the time such sale, assignment, transfer or
other disposition is consummated, (b) Disposition Closing Costs and (c)
Disposition Related Debt.
"PERMITTED DISPOSITION": as defined in paragraph 8.6(iv).
"PROCEEDS DISBURSEMENT REQUEST": a notice of the Company in the form
of Exhibit B to Amendment No. 3, specifying (i) the aggregate amount of Net Cash
Proceeds requested to be disbursed from the Disbursement Account, (ii) the
requested disbursement date and (iii) the intended use of such Net Cash Proceeds
and certifying, representing and warranting that (x) no Default or Event of
Default has occurred and is continuing and (y) such Net Cash Proceeds shall be
used in accordance with and for the purposes and in the categories and in the
amounts set forth in the Projections except as otherwise permitted by paragraph
8.14 of this Agreement.
"PROJECTIONS": the projections of the Company dated March 16, 2000
(Revised) delivered to the Agent and the Lenders in the form of Schedule A to
Amendment No. 3.
"RESERVE ACCOUNT": the blocked reserve account maintained by the
Company at BNY under the dominion and control of the Agent.
"RESTRUCTURING COSTS": the fees and expenses (including reasonable
attorneys' and accountants' fees and expenses) (i) payable by the Company or any
Subsidiary in connection with (x) the execution and delivery of Amendment No. 3
(including, without limitation, fees and expenses in connection with the grant
by the Company and certain of its Subsidiaries of Liens in favor of the Agent on
certain of their property), (y) the amendments to or waivers of the Covenant
Credit Facilities contemplated by, and executed and delivered contemporaneously
with, Amendment No. 3 and (z) the extension of maturity dates of Indebtedness
and expiry dates of letters of credit which mature or expire, as the case may
be, prior to the Liquidity Subfacility Termination Date to a date that is not
earlier than the Liquidity Subfacility Termination Date, and (ii) incurred by
the Company in an amount of up to $5,000,000 in connection with the issuance by
the Company of any Stock after the
3
<PAGE>
Amendment No. 3 Effective Date, in each case accrued or capitalized as a cost of
issuance in accordance with GAAP.
"SALES LOSSES": losses incurred by the Company or any Subsidiary in
connection with any Permitted Disposition determined in accordance with GAAP.
"SPRINGING CREDIT EVENT": any event or any event that with the
giving of notice of the passage of time or both results in a Springing Credit
Obligation.
"SPRINGING CREDIT OBLIGATION": any agreement or obligation of the
Company or any Subsidiary under any loan document, indenture, or other agreement
to provide a letter of credit or other credit support.
"STEERING COMMITTEE": the informal committee of creditors of the
Company and/or its Subsidiaries composed of the Agent and other creditors of the
Company represented by O'Melveny & Myers LLP as of the Amendment No. 3 Effective
Date.
1.2 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Aggregate Commitments" in its entirety and
substituting the following therefor:
"AGGREGATE COMMITMENTS": the sum of the Commitments set
forth in Exhibit A to Amendment No. 3 (which as of the
Amendment No. 3 Effective Date equals $100,000,000), as the
same may be reduced pursuant to paragraph 2.5 (Reduction of
Commitments) or 2.18 (Extension of Termination Date).
1.3 Section 1.1 of the Credit agreement is hereby amended by
deleting the definition of "Commitment" in its entirety and substituting the
following therefor:
"COMMITMENT": as to any Lender, the amount set forth
next to the name of such Lender in Exhibit A to Amendment No.
3 under the heading "Commitment," as such Commitment may be
reduced pursuant to paragraphs 2.5 or 11.7(b).
1.4 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Commitment Percentage" in its entirety and
substituting the following therefor:
"COMMITMENT PERCENTAGE": as to any Lender, the percentage that
the Commitment of such Lender bears to the Aggregate Commitments, as
set forth opposite the name of such Lender in Exhibit A to Amendment
No. 3 under the heading "Commitment Percentage", as such percentage
may be reallocated pursuant to paragraph 2.18 (whereupon such
percentage shall become such Lender's Reallocated Commitment
Percentage, as such term is
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hereinafter defined) or decreased upon an assignment permitted under
paragraph 11.7(b).
1.5 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Eligible Assignee" in its entirety and substituting
the following therefor:
"ELIGIBLE ASSIGNEE": an assignee which is a commercial bank,
an insurance company, a finance company, a financial institution,
any fund that invests in loans or any other "accredited investor"
(as defined in Regulation D promulgated under the Securities Act of
1933, as amended), but in any event excluding the Company and its
Subsidiaries and Affiliates.
1.6 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Fixed Charge Coverage Ratio" in its entirety and
substituting the following therefor:
"FIXED CHARGE COVERAGE RATIO": the ratio of (i) the sum of
Operating Income, Interest Expense, Rent Expense, and, to the extent
deducted from the determination of Operating Income in accordance
with GAAP, Restructuring Costs and Sales Losses, if any, to (ii) the
sum of Interest Expense and Rent Expense,
all on a Consolidated basis.
1.7 Section 2.24 of the Credit Agreement is hereby deleted in its
entirety and the following substituted therefor:
Section 2.24 REDUCTION OF COMMITMENTS; AVAILABILITY
OF COMMITMENTS AND PRICING OPTIONS.
The Company agrees that, notwithstanding any other
provision of this Agreement, (x) on the Amendment No. 3 Effective
Date, the Aggregate Commitments shall be permanently reduced from
$200,000,000 to $100,000,000 and the Commitment of each Lender shall
be reduced pro rata as set forth on Exhibit A to Amendment No. 3,
and (y) during the period from the Amendment No. 3 Effective Date to
and including the date on which the Required Lenders, in their sole
discretion, agree to reinstate the ability of the Company to borrow
Loans under the Commitments (as reduced hereby) and request the
issuance of Letters of Credit and to reinstate the availability of
Competitive Bid Loan and CD Loans:
(i) the Company shall not be entitled to request
and the Lenders shall not be obligated to make any additional Loans,
except Liquidity Loans;
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(ii) the Company shall not be entitled to request
and the Issuing Bank shall not be required to issue any additional
Letters of Credit;
(iii) the Company shall be entitled to elect
Interest Periods of only 30 days for Eurodollar Loans;
(iv) the Company may not and shall not request any
Competitive Bid Borrowings; and
(v) the Company may not and shall not request any
CD Loan and may not and shall not request that any Loan be converted
to a CD Loan.
1.8 Section 2 of the Credit Agreement is hereby amended by adding
a new Section 2.25 to read as follows:
2.25. DISBURSEMENT ACCOUNT, RESERVE ACCOUNT AND
COLLATERAL FOR SUBFACILITY.
(a) SECURITY INTERESTS - DISBURSEMENTS ACCOUNT
AND RESERVE ACCOUNT.
The Company acknowledges and agrees that, pursuant
to the Security Documents, the Disbursement Account and the Reserve
Account and the Net Cash Proceeds from time to time deposited in or
credited to the Disbursement Account and the Reserve Account and all
interest and earnings thereon secure the Subfacility Obligations.
(b) SET-OFF - DISBURSEMENT ACCOUNT AND RESERVE
ACCOUNT.
The Company acknowledges that the Net Cash
Proceeds from time to time deposited and held in the Disbursement
Account or in the Reserve Account shall, in addition to the rights
of the Agent therein pursuant to the Security Documents, be subject
to the Agent's right of setoff (which may be exercised upon the
occurrence of an Event of Default which is continuing) up to an
amount not to exceed the aggregate amount of Indebtedness and
obligations of the Company outstanding from time to time under this
Agreement, including, without limitation, Indebtedness and
obligations of the Company under the Liquidity Subfacility; provided
that any amounts set off by the Agent after the occurrence of an
Event of Default or otherwise in excess of the aggregate amount of
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Indebtedness and obligations of the Company under the Liquidity
Subfacility shall be held by the Agent to be applied for the benefit
of all holders of Credit Facility Indebtedness on terms and
conditions to be agreed to by the Agent, the Required Lenders and
the requisite creditors under the Credit Facility Indebtedness (or,
if such agreement is not reached, in accordance with the order of a
court of competent jurisdiction).
(c) RELEASE OF NET CASH PROCEEDS FROM
DISBURSEMENT ACCOUNT.
The Company may from time to time but not more
frequently than once each calendar week request that the Agent
release Net Cash Proceeds from the Disbursement Account by
delivering to the Agent a Proceeds Disbursement Request not later
than 11:00 A.M., New York City time, one (1) Business Day prior to
the requested disbursement date (the "DISBURSEMENT DATE"). Provided
that the Agent shall have received a Proceeds Disbursement Request
in accordance with the terms hereof, the Agent, not later than 11:00
A.M., New York City time on the Disbursement Date, shall release the
Net Cash Proceeds covered by such Proceeds Disbursement Request to
the Company.
(d) DISPOSITION OF NET CASH PROCEEDS - DISBURSEMENT
ACCOUNT AND RESERVE ACCOUNT.
Except for (i) the right of the Company to request
the release of Net Cash Proceeds from the Disbursement Account
pursuant to paragraph 2.25(c) hereof, (ii) the rights of the Agent,
for the ratable benefit of the Lenders, as secured party and (iii)
the right of set-off of the Agent (as limited by paragraph 2.25(b)),
(A) none of the Company, any Subsidiary, any Lender, or the holder
of Indebtedness of the Company or any Subsidiary shall have any
right to request the release or disbursement of any funds in the
Disbursement Account or the Reserve Account and (B) any and all
funds deposited in the Disbursement Account and Reserve Account
(other than the funds deposited in the Reserve Account, which shall
secure, and may be applied in satisfaction of, the obligations of
the Company and the Subsidiary Guarantors in respect of the
Liquidity Subfacility in accordance with the terms of this Agreement
and the Security Documents) shall be held in such accounts pending
the execution of an agreement among the Company, the Agent, the
Required Lenders and the requisite creditors under the Credit
Facility Indebtedness (or, if such
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agreement is not reached, the order of a court of competent
jurisdiction).
(e) SUBSTITUTION AND RELEASE OF COLLATERAL.
The Agent and the Lenders agree that provided no
Default or Event of Default has occurred and is continuing, the
Agent and the Lenders promptly will:
(i) release their security interest in the
Collateral (including the Disbursement Account but not the Reserve
Account) upon the written request of the Company after Ogden
Services Corporation shall have deposited Net Cash Proceeds received
by Ogden Services Corporation from the sale of the "food and
beverage" business or another business sold by Ogden Services
Corporation permitted to be sold hereunder of not less than
$51,000,000 in the Reserve Account as substitute collateral for the
Collateral; and
(ii) release their security interest in the
Collateral (including the Disbursement Account and the Reserve
Account) upon (A) the repayment in full of the Liquidity Loans and
all accrued interest thereon and the termination of the Liquidity
Subfacility, (B) the cancellation of the Liquidity Subfacility by
the Company at any time that no Liquidity Loans are outstanding or
(C) receipt by the Agent of Net Cash Proceeds from the sale of the
Aviation Business and the simultaneous repayment in full of the
Liquidity Loans and all accrued interest thereon and termination of
the Liquidity Subfacility, which release shall be simultaneous with
such sale and the receipt of such Net Cash Proceeds and repayment.
The Agent and the Lenders shall execute and deliver to the Company
such instruments and documents as the Company may reasonably request
to evidence such release, at the sole cost and expense of the
Company.
(f) DUTIES OF THE AGENT WITH RESPECT TO DISBURSEMENT
ACCOUNT AND RESERVE ACCOUNT.
(i) The duties, responsibilities and obligations
of the Agent with respect to the Disbursement Account and the
Reserve Account shall be limited to those expressly set forth herein
and no duties, responsibilities or obligations shall be inferred or
implied. The Agent shall not be subject to, nor required to comply
with, any other agreement to which the Company is a party, even
though reference thereto may be made herein, or to comply with any
direction or instruction (other than those contained herein or
delivered
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in accordance with this Agreement) from the Company or any entity
acting on its behalf. The Agent shall not be required to, and shall
not, expend or risk any of its own funds or otherwise incur any
financial liability in the performance of any of its duties as Agent
under this paragraph 2.25.
(ii) If at any time the Agent is served with any
judicial or administrative order, judgment, decree, writ or other
form of judicial or administrative process which in any way affects
the Disbursement Account or the Reserve Account (including but not
limited to orders of attachment or garnishment or other forms of
levies or injunctions or stays relating to the transfer of the
Disbursement Account or the Reserve Account), the Agent is
authorized to comply therewith in any manner as it or its legal
counsel of its own choosing deems appropriate; and if the Agent
complies with any such judicial or administrative order, judgment,
decree, writ or other form of judicial or administrative process,
the Agent shall not be liable to any of the parties hereto or to any
other person or entity even though such order, judgment, decree,
writ or process may be subsequently modified or vacated or otherwise
determined to have been without legal force or effect.
(iii) The Agent shall not be liable for any action
taken or omitted or for any loss or injury resulting from its
actions or its performance or lack of performance of its duties
under this paragraph 2.25 in the absence of gross negligence or
willful misconduct on its part. In no event shall the Agent be
liable (i) for acting in accordance with or relying upon any
instruction, notice, demand, certificate or document from the
Company or any entity acting on behalf of the Company, (ii) for any
consequential, punitive or special damages, (iii) for the acts or
omissions of its nominees, correspondents, designees, subagents or
subcustodians, or (iv) for an amount in excess of the amount then
deposited in or credited to the Disbursement Account or the Reserve
Account.
(iv) If any fees, expenses or costs incurred by,
or any obligations owed to, the Agent under this paragraph 2.25 are
not promptly paid when due, the Agent may reimburse itself therefor
from the Disbursement Account or the Reserve Account and may sell,
convey or otherwise dispose of any amounts or property deposited in
or credited to such accounts for such purpose.
(v) The Agent may consult with legal counsel and
the accounting firm retained by the Steering Committee at
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the reasonable expense of the Company as to any matter relating to
the administration of the Disbursement Account or the Reserve
Account, and the Agent shall not incur any liability in acting in
good faith in accordance with any advice from such counsel or
accounting firm.
(vi) The Agent shall not incur any liability for
not performing any act or fulfilling any duty, obligation or
responsibility under this paragraph 2.25 by reason of any occurrence
beyond the control of the Agent (including but not limited to any
act or provision of any present or future law or regulation or
governmental authority, any act of God or war, or the unavailability
of the Federal Reserve Bank wire or telex or other wire or
communication facility).
(vii) The Agent shall not be responsible in any
respect for the form, execution, validity, value or genuineness of
documents or securities deposited hereunder, or for any description
therein, or for the identity, authority or rights of persons
executing or delivering or purporting to execute or deliver any such
document, security or endorsement.
(viii) The Company shall be liable for and shall
reimburse and indemnify the Agent and hold the Agent harmless from
and against any and all claims, losses, liabilities, costs, damages
or expenses (including reasonable attorneys' and accountants' fees
and expenses) (collectively, "LOSSES") arising from or in connection
with or related to the Disbursement Account or the Reserve Account
or with respect to the Agent's custody and administration of the
Disbursement Account and the Reserve Account (including but not
limited to Losses incurred by the Agent in connection with its
successful defense, in whole or in part, of any claim of gross
negligence or willful misconduct on its part), provided, however,
that nothing contained herein shall require the Agent to be
indemnified for Losses caused by its gross negligence or willful
misconduct.
(ix) In the event of any ambiguity or uncertainty
in any notice, instruction or other communication received by the
Agent hereunder, the Agent may, in its sole discretion, refrain from
taking any action other than retain possession of the Disbursement
Account and the Reserve Account.
(x) In the event of any dispute between or
conflicting claims by the Company and/or any other person or entity
with respect to the Disbursement Account or the Reserve Account, the
Agent shall be entitled, in its sole discretion, to refuse to comply
with any and all claims, demands or instructions with respect to the
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Disbursement Account or the Reserve Account so long as such dispute
or conflict shall continue, and the Agent shall not be or become
liable in any way to the Company for failure or refusal to comply
with such conflicting claims, demands or instructions. The Agent
shall be entitled to refuse to act until, in its sole discretion,
either (1) such conflicting or adverse claims or demands shall have
been determined by a final order, judgment or decree of a court of
competent jurisdiction, which order, judgment or decree is not
subject to appeal, or settled by agreement between the conflicting
parties as evidenced in a writing satisfactory to the Agent or (2)
the Agent shall have received security or an indemnity satisfactory
to it sufficient to hold it harmless from and against any and all
Losses which it may incur by reason of so acting. The Agent may, in
addition, elect, in its sole discretion, to commence an interpleader
action or seek other judicial relief or orders as it may deem, in
its sole discretion, necessary. The costs and expenses (including
reasonable attorneys' fees and expenses) incurred in connection with
such proceeding shall be paid by the Company.
1.9 Section 3.1 of the Credit Agreement is hereby amended by (i)
adding to the heading thereof the phrase "; OTHER FEES.", (ii) renumbering the
existing paragraph as Section 3.1(a) and (iii) adding a new Section 3.1(b) at
the end thereof to read in its entirety as follows:
(b) The Company agrees to pay to the Agent for the pro rata
account of each Lender a fee in the amount of $500,000, payable on
the earlier to occur of (i) the date on which the Company and its
Subsidiaries shall have received gross proceeds in an aggregate
amount of $500,000,000 from all sales, assignments, transfers or
other dispositions of PROPERTY after the Amendment No. 3 Effective
Date in accordance with the terms hereof and (ii) the date on which
the Loans and all other obligations under this Agreement (including,
without limitation, all interest, fees and expenses payable to the
Agent or the Lenders hereunder) shall have been paid and performed
in full and the Commitments terminated.
1.10 Section 7.2 of the Credit Agreement is hereby amended by
adding a new Section 7.2(g) thereto to read in its entirety as follows:
(g)(i) As soon as available, but in any event not later than
Wednesday of each week, weekly updates of the monthly cash flow
statements of the Company and its Subsidiaries in a format
consistent with past practice.
(ii) Conduct weekly meetings and conference calls with the
Agent, the Lenders under this Agreement and the Steering Committee
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to discuss and review such matters as the Agent and the Steering
Committee deems appropriate, including, without limitation, reports
with respect to, and explanations of, any material variances between
the Projections and the Company's and its Subsidiaries' actual
results of operations.
(iii) As soon as available, deliver to the Agent notice of any
Springing Credit Event and any demand under a Springing Credit
Obligation.
1.11 Section 7.11 of the Credit Agreement is hereby deleted in its
entirety and the following substituted therefor:
7.11 SHAREHOLDERS' EQUITY.
Maintain at all times for each period set forth below its
Shareholders' Equity in an amount not less than the amount set forth
below opposite such period:
PERIOD MINIMUM SHAREHOLDERS' EQUITY
Effective Date to and including
December 31, 1999 $440,000,000
January 1, 2000 to and
including July 31, 2000 $400,000,000
August 1, 2000 and thereafter $440,000,000
1.12 Section 7 of the Credit Agreement is hereby amended by adding
a new Section 7.12 to read in its entirety as follows:
7.12 CERTAIN AMENDMENTS.
Use its best efforts to extend the maturity date or expiry
date of any Indebtedness or Credit Facility Indebtedness which
matures or expires, as the case may be, prior to the Liquidity
Subfacility Termination Date (other than with respect to the
periodic renewal of the Credit Facility Indebtedness described in
items 9 through 12 on Schedule C to Amendment No. 3) to a date that
is not earlier than the Liquidity Subfacility Termination Date.
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1.13 Section 8.1 of the Credit Agreement is hereby deleted in its
entirety and the following substituted therefor:
8.1 INDEBTEDNESS.
Create, incur, assume or suffer to exist, or permit any
Subsidiary to create, incur, assume or suffer to exist, any
liability for Indebtedness, except:
(i) Indebtedness under the Loan Documents; and
(ii) Credit Facility Indebtedness (including any Credit
Facility Indebtedness incurred under commitments available on the
Amendment No. 3 Effective Date provided that the proceeds of such
Credit Facility Indebtedness are not applied to repay the principal
amount of any other Indebtedness), any Indebtedness of the Company
or any Subsidiary outstanding as of the Amendment No. 3 Effective
Date, any Indebtedness representing capitalized interest on any
Credit Facility Indebtedness and any extensions, renewals and
replacements of any such Indebtedness or Credit Facility
Indebtedness that do not increase the outstanding principal amount
thereof (other than as a result of the capitalization of interest).
1.14 Section 8.2 of the Credit Agreement is hereby deleted in its
entirety and the following substituted therefor:
8.2 LIENS.
Create, incur, assume or suffer to exist any Lien on any
of its or its Subsidiaries' Property or assets, whether now owned or
hereafter acquired, securing any Indebtedness or obligation, or
permit any Subsidiary to do so, except (i) Permitted Liens (other
than of the type described in subparagraph (ix) of the definition of
"Permitted Liens"), (ii) Liens granted pursuant to the Security
Documents, (iii) Liens existing on the Amendment No. 3 Effective
Date that were permitted under this Agreement or under any other
Covenant Credit Facilities and (iv) equal and ratable Liens
permitted by paragraph 8.15.
1.15 Section 8.4 of the Credit Agreement is hereby amended by (i)
deleting the semi-colon and the word "and" at the end of clause (iii) thereof
and substituting therefor a period and (ii) deleting clause (iv) thereof in its
entirety.
1.16 Section 8.6 of the Credit Agreement is hereby deleted in its
entirety and the following substituted therefor:
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8.6 SALE OF PROPERTY.
Sell, assign, exchange, lease, transfer or otherwise
dispose of any Property, whether now owned or hereafter acquired, to
any Person, or permit any Subsidiary so to do, except:
(i) the use of cash by the Company or such Subsidiary in
the ordinary course of business and transfers of cash under the
Company's cash management system in the ordinary course of business;
(ii) dispositions by one Subsidiary to the
Company or a wholly-owned subsidiary of the Company;
(iii) (a) sales of inventory in the ordinary course of
business, (b) sales, assignments, transfers or other dispositions in
the ordinary course of business consistent with past practice of any
Property that, in the reasonable opinion of the Company or such
Subsidiary, as the case may be, is obsolete and (c) sales,
assignments, transfers or other dispositions of any Property that,
in the reasonable opinion of the Company or such Subsidiary, as the
case may be, is no longer useful in the conduct of its business as
currently conducted having a fair market value in the good faith
determination of the Company of not more than $5,000,000 in the
aggregate, provided that all Net Cash Proceeds from such sales,
assignments, transfers or dispositions are deposited in the
Disbursement Account or the Reserve Account, as the case may be, in
accordance with paragraph 8.6(iv); and
(iv) sales, assignments, transfers or other dispositions
of the Property described on Schedules B-1, B-2 and B-3 to Amendment
No. 3 (together with the sales, assignments, transfers and
dispositions described in paragraph 8.6(iii)(c), each a "PERMITTED
DISPOSITION" and collectively, the "PERMITTED DISPOSITIONS") for
cash and non-cash consideration (including assumption of
Indebtedness) payable or received on the date of such Permitted
Disposition provided that:
(a) the Net Cash Proceeds of each such Permitted
Disposition with respect to the Property described on Schedule B-1
to Amendment No. 3 shall be in an amount of not less than 90% of the
amount set forth on Schedule B-1 to Amendment No. 3 opposite the
description of such Property,
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(b) the Net Cash Proceeds of each such Permitted
Disposition with respect to the Property described on Schedule B-2
to Amendment No. 3 shall be in an amount of not less than 75% of the
amount set forth on Schedule B-2 to Amendment No. 3 opposite the
description of such Property,
(c) all Net Cash Proceeds of each Permitted
Disposition (other than Net Cash Proceeds applied in repayment of
the Liquidity Loans and the permanent reduction of the Liquidity
Subfacility Amount pursuant to paragraph 2.6) in an aggregate amount
for all Permitted Dispositions of up to the sum of (x) $100,000,000
and (y) the Restructuring Costs shall be deposited directly on the
date of receipt by the Company or such Subsidiary in the
Disbursement Account, which Net Cash Proceeds shall be held and
disbursed in accordance with paragraph 2.25 of this Agreement,
(d) the Net Cash Proceeds of any Permitted
Disposition (other than Net Cash Proceeds applied in repayment of
the Liquidity Loans and the permanent reduction of the Liquidity
Subfacility Amount pursuant to paragraph 2.6) in excess of the sum
of (x) $100,000,000 for all asset sales in the aggregate and (y) the
Restructuring Costs shall be deposited directly on the date of
receipt by the Company or such Subsidiary in the Reserve Account,
which Net Cash Proceeds shall be held and disbursed in accordance
with paragraph 2.25 of this Agreement,
(e) no Default or Event of Default shall have
occurred and be continuing on the date of and after giving effect to
such Permitted Disposition,
(f) promptly after execution of such agreement or
contract but in any event not less than 10 Business Days prior to
such sale, the Company shall have furnished the Agent a copy of the
agreement or contract for the sale of the applicable Property and a
statement setting forth, on a PRO FORMA basis, the total
consideration to be paid to the Company (or other seller) under the
agreement or contract for the sale for such Property and the
estimated amount, if any, of the Disposition Closing Costs and
Disposition Related Debt to be assumed or to be paid from the
consideration for the sale and the Net Cash Proceeds to be realized
(by the Company or other seller) from the sale after the deduction
or payment of the Disposition Closing Costs and Disposition Related
Debt (each a "PRO-FORMA SALE STATEMENT"), and within 5 Business Days
after the consummation of such sale, the Company shall deliver to
the Agent a closing statement
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or such other statement indicating any material variance between the
Pro Forma Sale Statement and the actual amount received and paid in
connection with such sale, and
(g) notwithstanding the foregoing, all Net Cash
Proceeds of the sale, assignment, transfer or other disposition of
the Collateral shall first be applied as a mandatory prepayment of
the Liquidity Loans and to permanently reduce the Liquidity
Subfacility Amount in accordance with paragraph 2.6(b).
1.17 Section 8.9 of the Credit Agreement is hereby deleted in its
entirety and the following substituted therefor:
8.9 FIXED CHARGE COVERAGE RATIO.
Permit the Fixed Charge Coverage Ratio to be less than:
(i) 1.25 to 1.00 for the four fiscal quarters (taken as
a whole) ending on December 31, 1999,
(ii) 1.10 to 1.00 for the four fiscal quarters (taken as
a whole) ending on March 31, 2000,
(iii) 0.95 to 1.00 for the four fiscal quarters ending
on June 30, 2000, and
(iv) 1.50 to 1.00 for any four fiscal quarters (taken as
a whole) ending on the last day of each September, December, March
and June thereafter.
1.18 Section 8 of the Credit Agreement is hereby amended by adding
new Sections 8.11, 8.12, 8.13, 8.14 and 8.15 at the end thereof to read in their
entirety as follows:
8.11 INVESTMENTS, LOANS, ADVANCES AND GUARANTEES.
At any time, purchase or otherwise acquire (including
pursuant to any merger with any Person), hold or invest in any
capital stock, evidences of indebtedness or other securities
(including any option, warrant or other right to acquire any of the
foregoing and any derivative product) of, make or permit to exist
any loans to or advances on behalf of, incur any Guarantees in
respect of any obligations of, or make or permit to exist any
investment or any other interest in, any other Person (all of which
are sometimes referred to
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herein as "INVESTMENTS"), (or permit any Subsidiary to do any of the
foregoing) except:
(i) Investments in cash and cash equivalents and in
normal business banking accounts on deposit with or issued by,
federally insured institutions;
(ii) Investments in Hedging Agreements entered into in
connection with Credit Facility Indebtedness;
(iii) Investments described in the Projections not
otherwise prohibited by the terms hereof;
(iv) Guarantees of Indebtedness and Credit
Facility Indebtedness permitted by paragraph 8.1;
(v) Investments existing on the Amendment No. 3
Effective Date;
(vi) Advances to the Ottawa Senators Hockey Club
Corporation under the commitment of the Company in effect on the
Amendment No. 3 Effective Date (and as thereafter amended in
accordance with the terms hereof);
(vii) with respect to existing (or permitted pursuant to
paragraph 8.1) debt financing on projects of the Company's energy
business, any Investments made from time to time of amounts
deposited in debt service reserve funds and other funds and accounts
created under the indenture pertaining to such debt financing,
provided that such Investments are made in accordance with the terms
of the related indenture, including, without limitation, provisions
dealing with permitted investments; and
(viii) the Investments described in clauses (i) and (ii)
of paragraph 8.12.
8.12 ACQUISITIONS.
At any time, make, or enter into an agreement to make
(or permit any Subsidiary to make or enter into an agreement to
make), any Acquisition or make any deposit in connection with any
potential Acquisition except (i) for the Acquisition by the Company
of an interest in Gulf Electric Public Company Limited (Thailand)
for an aggregate purchase price not to exceed $28,000,000 and (ii)
for activities in respect of the acquisition or development of new
facilities,
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projects or investments for the Company's energy business, so long
as (1) any activity engaged in by the Company or any Subsidiary or
any agreement entered into by the Company or any Subsidiary with
respect to such activities may be terminated or cancelled by the
Company or such Subsidiary without liability to the Company or such
Subsidiary other than the forfeiture of any deposit made by the
Company or such Subsidiary, and (2) any deposits made by the Company
or any of its Subsidiaries (irrespective of the form of the deposit,
including without limitation, cash deposits or bonds) in respect of
the activities or agreements described in Section 8.12 (ii) shall
not exceed $2,500,000 in the aggregate.
8.13 PAYMENTS OF INDEBTEDNESS.
Except as specifically set forth in the Projections (in
the categories and in the amounts set forth therein):
(i) pay or obligate itself to pay (or permit any
Subsidiary to pay or obligate itself to pay), in whole or in part,
the principal amount of any Indebtedness or Credit Facility
Indebtedness; provided, however, so long as no Default or Event of
Default then exists or results therefrom, the Company and any
Subsidiary may pay or prepay:
(1) Indebtedness or Credit Facility Indebtedness
permitted to be paid pursuant to paragraph 8.15;
(2) reimbursement obligations for drawings under letters
of credit made to fund scheduled interest payments;
(3) reimbursement obligations for drawings under letters
of credit solely to the extent that the amount available for
drawing under any such letter of credit after giving effect to
such payment increases by an amount equal to such payment; and
(4) reimbursement obligations for drawings under letters
of credit made from the proceeds of the remarketing notes or
other obligations, so long as such payments are made solely
out of the proceeds of the remarketing of the notes or other
obligations with respect to which such letters of credit were
issued and the applicable letters of credit remain
outstanding, or
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(ii) incur or make (or permit any Subsidiary to incur or
make) any payment in respect of lease buyout obligations.
8.14 CAPITAL EXPENDITURES.
Incur (or permit any Subsidiary to incur) Capital
Expenditures; provided, however, so long as no Default or Event of
Default then exists or results therefrom, (a) the Company and its
Subsidiaries may make the Capital Expenditures in accordance with
the categories and amounts set forth in the Projections, subject to
(i) reallocation of amounts among categories as a result of cost and
expense savings and (ii) prospective cost overruns with respect to
the Jazzland project in an amount not to exceed $12,000,000 (based
on a budgeted total cost for such project of $110,000,000) and (b)
the operating Subsidiaries of the Company may make Capital
Expenditures in the ordinary course of business consistent with past
practice, provided that such Capital Expenditures do not require the
contribution of funds from the Company or any Subsidiary of the
Company in excess of the amounts permitted by clause (a) above.
8.15 MOST FAVORED NATION COVENANTS.
(a) Prepay, redeem, purchase, defease or otherwise
satisfy or amend, modify or extend (or permit any Subsidiary to
prepay, redeem, purchase, defease or otherwise satisfy or amend,
modify or extend) any existing Indebtedness or Credit Facility
Indebtedness, except:
(i) Disposition Related Debt,
(ii) extensions, renewals and replacements of
Indebtedness or Credit Facility Indebtedness permitted by
paragraph 8.l and, without duplication, payments permitted by
paragraph 8.13(i),
(iii) extension of the maturity of the
indebtedness represented by the Amended and Restated
Promissory Note, dated February 17, 2000, from Ogden Power
Corporation to Pacific Enterprises Energy Management Services
in the amount of $22,913,605.00 and related credit support,
(iv) Indebtedness of the Company and its
Subsidiaries in respect of the Subfacility under this
Agreement and the other Loan Documents, or
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(v) to the extent that, contemporaneously
therewith or prior thereto, the Commitments of the Lenders are
reduced and the Loans are repaid in an equal and ratable
manner;
(b) grant (or permit any Subsidiary to grant) any Lien
in respect of any of its Property, Stock or assets to secure any
existing Indebtedness, except:
(i) Liens permitted under Section 8.2 of
this Agreement, or
(ii) to the extent that the Company's (or such
Subsidiary's) obligations under this Agreement and the other
Loan Documents are contemporaneously therewith or prior
thereto equally and ratably secured, or
(c) pay (or permit any Subsidiary to pay) any fee or
other similar consideration to any holder of any Indebtedness to
amend or waive any term or provision thereof at a rate or amount
greater than that paid or payable to the Agent and the Lenders
pursuant to paragraph 3.1(b) hereof and Section 3.1(g)(ii) of
Amendment No. 3; provided, however, the Company may pay to creditors
under Credit Facility Indebtedness a fee of up to one-quarter
percent (1/4%) of the principal amount of any outstanding Credit
Facility Indebtedness that matures prior to the Liquidity
Subfacility Termination Date, or the amount available for drawing
under any letter of credit outstanding under any Credit Facility
Indebtedness that expires prior to the Liquidity Subfacility
Termination Date, as consideration for the extension of such
maturity date or expiry date to a date that is not earlier than the
Liquidity Subfacility Termination Date, which fee shall be applied
on account of any fee comparable to the fee described in paragraph
3.1(b) hereof payable to such creditors.
1.19 Section 9.1 of the Credit Agreement is hereby amended by (i)
deleting the reference in Section 9.1(f) to "$25,000,000" and substituting
therefor "$1,000,000", (ii) adding the phrase "or Credit Facility Indebtedness"
after the term "Indebtedness" in Section 9.1(f), (iii) deleting the period at
the end of Section 9.1(j) thereof and substituting a semi-colon therefor and
(iv) adding new Sections 9.1(k), 9.1(l), 9.1(m), 9.1(n) and 9.1(o) at the end
thereof to read in their entirety as follows:
(k) except as specifically contemplated by paragraphs 2.25(e)
and 2.27(d), any material Lien purported to be created under any
Security Document shall cease to be, or shall be asserted by the
Company or any Subsidiary not to be, a valid and perfected Lien on,
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and security interest in, any Collateral, with the priority required
by the applicable Security Document and such default, if not the
result of any action or failure to act on the part of the Company or
any Subsidiary, continues for a period of thirty (30) days or more;
or any Subsidiary Guarantee or any provision thereof shall cease to
be in full force or effect as to the relevant Subsidiary Guarantor,
or any Subsidiary Guarantor or Person acting by or on behalf of such
Subsidiary Guarantor shall deny or disaffirm such Subsidiary
Guarantor's obligations under the relevant Subsidiary Guarantee, or
any Subsidiary Guarantor shall default in any material respect in
the due performance or observance of any term, covenant or agreement
on its part to be performed or observed pursuant to its Subsidiary
Guarantee; or
(l) any letter of credit, bond or other credit or liquidity
support shall have been terminated after its then stated expiration
or termination date or shall have not been renewed beyond its then
stated expiration or termination date, unless not later than five
(5) days prior to such expiration or termination date, such letter
of credit, bond or other credit or liquidity support is replaced
with another such instrument on terms and conditions permitted under
this Agreement (including, without limitation, the fees payable in
connection with the issuance thereof); or
(m) the occurrence of any Springing Credit Event and a demand,
by any holder of a Springing Credit Obligation, for the issuance of
a letter of credit, bond or other credit or liquidity support and
such demand is not resolved on terms that do not violate the terms
of this Agreement prior to the date on which the party making such
demand is entitled to take remedial action under the applicable
agreement (provided that a reduction in the annual fees payable to
Ogden Martin Systems of Montgomery Inc. in an amount not to exceed
$1,000,000 in connection with the service agreement between the
Northeast Maryland Solid Waste Facility and Ogden Martin Systems of
Montgomery Inc. shall not constitute an Event of Default); or
(n) The Company or any Subsidiary shall pay or prepay the
principal amount of any Indebtedness or Credit Facility
Indebtedness, or repurchase any Indebtedness, in cash or in
property, or set aside in any manner any cash or property in respect
of any Indebtedness or Credit Facility Indebtedness, except as
specifically permitted in paragraph 8.13 or 8.15; or
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(o) The proceeds of any advances to the Ottawa Senators Hockey
Club Corporation under the commitment of the Company to make
advances to the Ottawa Senators Hockey Club Corporation in effect on
the Amendment No. 3 Effective Date (and thereafter amended in
accordance with the terms hereof) are used to repay the principal
amount of any Indebtedness or Credit Facility Indebtedness except as
provided under such commitment as in effect on the Amendment No. 3
Effective Date (and thereafter amended in accordance with the terms
hereof).
1.20 Section 11.7(b) of the Credit Agreement is hereby amended by
deleting the first sentence thereof in its entirety and substituting the
following therefor:
(b) Each Lender may, at any time and from time to time, sell,
assign, transfer or negotiate, on a pro rata basis, a constant (and
not varying) percentage of all of such Lender's rights and
obligations with respect to its Commitment and its related Loans,
obligations with respect to Letters of Credit and Notes, or if its
Commitment shall have been terminated, its Loans, its obligations
with respect to Letters of Credit and its Notes (provided that no
Lender may sell, assign, transfer or negotiate any of its rights and
obligations with respect to any Loan without selling, assigning,
transferring or negotiating to the purchaser, assignee or transferee
thereof a pro rata share in all such Lender's Loans, including
Liquidity Loans) (x) to one or more other Lenders (or to Affiliates
of such Lender or such other Lenders) upon prior written notice to
the Company, the L/C issuing Bank and the Agent or (y) to any other
Eligible Assignee upon the prior written consent of the Agent, the
L/C Issuing Bank and, so long as no Event of Default then exists,
the Company (which consents shall not be unreasonably withheld or
delayed), provided that if such purchaser, assignee or transferee is
not another Lender or an Affiliate of a Lender, (i) such selling,
assigning or transferring Lender shall continue to hold at all times
at least $2,500,000 of its original Commitment, or (ii) each such
sale, assignment, transfer or negotiation shall be in an amount not
less than the lesser of (A) $2,500,000 and (B) all of such Lender's
Commitment and (iii) such selling, assigning or transferring Lender
shall have paid to the Agent an assignment fee (the "ASSIGNMENT
FEE") of $3,500 payable to the Agent.
2. AMENDMENTS TO CREDIT AGREEMENT -- LIQUIDITY SUBFACILITY.
2.1 Section 1.1 of the Credit Agreement is hereby amended by adding
the following defined terms in the appropriate alphabetical order:
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"AVIATION BUSINESS": the discontinued aviation business of the
Company.
"COLLATERAL": any and all "Collateral" as defined in any Security
Document.
"COLLATERAL CERTIFICATE": as defined in paragraph 2.27(b).
"CZECH CREDIT AGREEMENT": the Credit Agreement between Czech-Ogden
Airhandling, spol. s.r.o. and Ogden International Europe, Inc. in the principal
amount of $17,451,804.
"CZECH LOAN ASSIGNMENT": the assignment by Ogden International
Europe, Inc. of the Czech Loan (as defined in the Czech Credit Agreement) to the
Agent for the benefit of the Lenders, in form and substance satisfactory to the
Agent, as amended, modified, supplemented, restated or replaced from time to
time.
"CZECH MORTGAGE": the first perfected Lien (or local law equivalent)
given by Czech-Ogden Airhandling, spol. s.r.o. to the Agent for the ratable
benefit of the Lenders, encumbering the cargo terminal owned by Czech-Ogden
Airhandling, spol. s.r.o. at Praha-Ruzyne Airport in the Czech Republic.
"DOMESTIC COLLATERAL": any and all "Collateral" as defined in any
Domestic Security Document.
"DOMESTIC SECURITY DOCUMENTS": collectively, the Security Agreement,
the Mortgage, the Domestic Subsidiary Guarantee and all other instruments and
documents delivered pursuant to paragraph 2.27 (other than Non-Domestic Security
Instruments) to secure any of the obligations of the Company or any Domestic
Subsidiary Guarantor under the Liquidity Subfacility.
"DOMESTIC SUBSIDIARY": each Subsidiary that is organized under the
laws of the United States of America, any state thereof, the District of
Columbia or any territory thereof.
"DOMESTIC SUBSIDIARY GUARANTEE": the Subsidiary Guarantee by and
among the Domestic Subsidiary Guarantors, the Company and the Agent, in form and
substance satisfactory to the Agent, as amended, modified, supplemented,
restated or replaced from time to time.
"DOMESTIC SUBSIDIARY GUARANTOR": Ogden Services Corporation,
Ogden Aviation, each Domestic Subsidiary of Ogden Aviation and any other
party to the Domestic Subsidiary Guarantee other than Ogden Allied
Maintenance Securities Inc. and the Fuel Facilities Group.
"FUEL FACILITIES GROUP": the companies listed on part (a) of
Schedule F to Amendment No. 3.
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"GUARANTEE SUPPLEMENT": a Guarantee Supplement in the form annexed
to the Subsidiary Guarantee.
"LIQUIDITY AVAILABILITY PERIOD": the period from the Liquidity
Subfacility Effective Date to, but excluding, the Liquidity Subfacility
Termination Date.
"LIQUIDITY BORROWING": a borrowing of principal amounts pursuant to
paragraph 2.26 consisting of Liquidity Loans of the same Type made by each
Lender.
"LIQUIDITY BORROWING REQUEST": a borrowing request in form and
substance satisfactory to the Agent.
"LIQUIDITY LOANS": Loans made as Base Rate Loans or Eurodollar Loans
pursuant to paragraph 2.26.
"LIQUIDITY SUBFACILITY": the secured subfacility provided for under
paragraph 2.26.
"LIQUIDITY SUBFACILITY AMOUNT": $50,000,000, as such amount may be
reduced from time to time pursuant to paragraph 2.6(b).
"LIQUIDITY SUBFACILITY EFFECTIVE DATE": the date on which the
conditions set forth in Section 4.1 of Amendment No. 3 are satisfied.
"LIQUIDITY SUBFACILITY TERMINATION DATE": July 31, 2000.
"MORTGAGE": the first perfected mortgage given by Ogden Projects,
Inc., to the Agent, for the ratable benefit of the Lenders, encumbering
the office building located in Fairfield, New Jersey.
"NON-DOMESTIC COLLATERAL": any and all "Collateral" (or any similar
term describing the assets on which the Agent has been granted a Lien) as
defined in any Non-Domestic Security Instrument.
"NON-DOMESTIC SECURITY INSTRUMENTS": collectively, the Czech Credit
Agreement Assignment, the Czech Mortgage and each instrument, document or
agreement delivered pursuant to paragraph 2.27 granting or purporting to grant
in favor of the Agent for the benefit of the Lenders a Lien on, or assigning or
purporting to assign to the Agent for the benefit of the Lenders, any other
Property or assets of, or any Stock of, any Non-Domestic Subsidiary to secure
the obligations of the Company or any Subsidiary Guarantor under this Agreement
or any of the Loan Documents, in each case as amended, modified, supplemented,
restated or replaced from time to time.
"NON-DOMESTIC SUBSIDIARY": each Subsidiary of Ogden Services
Corporation that is not a Domestic Subsidiary and is engaged in the Aviation
Business.
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"NON-DOMESTIC SUBSIDIARY GUARANTEE": collectively, each Guarantee by
any Non-Domestic Subsidiary Guarantor in favor of the Agent, in form and
substance satisfactory to the Agent, as amended, modified, supplemented,
restated or replaced from time to time.
"NON-DOMESTIC SUBSIDIARY GUARANTOR": each Non-Domestic Subsidiary of
Ogden Aviation and any other party to any Non-Domestic Subsidiary Guarantee.
"OGDEN AVIATION": Ogden Aviation, Inc. a wholly owned Subsidiary
of Ogden Services Corporation.
"ORIGINAL NOTE" and "ORIGINAL NOTES": as defined in
paragraph 2.4(a).
"1992 SENIOR NOTE INDENTURE": the Indenture dated March 1, 1992
between the Company and The Bank of New York, as trustee, providing for the
issuance of the Company's 9-1/4% debentures due March 1, 2022, as amended,
modified or supplemented from time to time.
"PERFECTION CERTIFICATE": a certificate in the form of Annex
A to the Security Agreement or any other form approved by the Agent.
"SECURED LIQUIDITY NOTE" and "SECURED LIQUIDITY NOTES": as defined
in paragraph 2.4(b).
"SECURED PARTIES": as defined in the Security Agreement.
"SECURITY AGREEMENT": a Security Agreement and Assignment, by and
among the Loan Parties party thereto and the Agent, in form and substance
satisfactory to the Agent, as amended, modified, supplemented, restated or
replaced from time to time.
"SECURITY DOCUMENTS": collectively, upon the execution and delivery
thereof, the Domestic Security Documents, the Non-Domestic Subsidiary
Guarantees, the Non-Domestic Security Instruments and all other instruments and
documents delivered pursuant to paragraph 2.27 to secure any of the obligations
of the Company and each Subsidiary Guarantor under this Agreement or any of the
Loan Documents.
"SUBSIDIARY GUARANTEE": collectively, the Domestic Subsidiary
Guarantee and the Non-Domestic Subsidiary Guarantees.
"SUBSIDIARY GUARANTOR": the Domestic Subsidiary Guarantors and the
Non-Domestic Subsidiary Guarantors.
2.2 The definition of "Affected Principal Amount" set forth in
Section 1.1 of the Credit Agreement is hereby amended by adding the phrase "or
paragraph 2.26(a)" after the phrase "paragraph 2.2" in clause (i) thereof.
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2.3 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Base Rate Loans" in its entirety and substituting
the following therefor:
"BASE RATE LOANS": R/C Loans or Liquidity Loans (or any
portions thereof) at such time as they (or such portions) are made
or are being maintained at a rate of interest based upon the Base
Rate.
2.4 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Borrowing Date" in its entirety and substituting the
following therefor:
"BORROWING DATE": any date specified in a Borrowing Request
delivered pursuant to paragraphs 2.2, 2.3, 2.20 or 2.26 as a date on
which the Company requests the Lenders to make Loans comprising an
R/C Borrowing, a Liquidity Borrowing or a Competitive Bid Borrowing
or the L/C Issuing Bank to issue a Letter of Credit.
2.5 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Borrowing Request" in its entirety and substituting
the following therefor:
"BORROWING REQUEST": an R/C Borrowing Request, a
Liquidity Borrowing Request, Competitive Bid Borrowing Request or
L/C Issuance Request, as the case may be.
2.6 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Conversion Date" in its entirety and substituting
the following therefor:
"CONVERSION DATE": with respect to R/C Loans or Liquidity
Loans, the date on which a Eurodollar or CD Loan is converted to a
Base Rate Loan, or the date on which a Base Rate Loan is converted
to a Eurodollar or CD Loan, or the date on which a Eurodollar Loan
is converted to a CD Loan or a new Eurodollar Loan or the date on
which a CD Loan is converted to a Eurodollar Loan or a new CD Loan,
all in accordance with paragraph 2.7. Notwithstanding the foregoing,
at all times after the Amendment No. 3 Effective Date, no Base Rate
Loan or Eurodollar Loan may be converted to a CD Loan, and no CD
Loan may be converted to a new CD Loan.
2.7 The definition of "Interest Period" set forth in Section 1.1 of
the Credit Agreement is hereby amended by adding the phrase "or Liquidity
Borrowing" after the phrase "R/C Borrowing" in the introductory clause of
paragraph (a) thereof.
2.8 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Loan" in its entirety and substituting the following
therefor:
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"LOAN": an R/C Loan, a Liquidity Loan or a Competitive
Bid Loan, as the case may be.
2.9 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Loans" in its entirety and substituting the
following therefor:
"LOANS": R/C Loans, Liquidity Loans or Competitive Bid
Loans, collectively.
2.10 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Loan Documents" in its entirety and substituting the
following therefor:
"LOAN DOCUMENTS" means, collectively, this Agreement, the
Notes, the Security Documents, the Letters of Credit, the
Applications for Letters of Credit and all other agreements,
instruments and documents executed or delivered in connection
herewith.
2.11 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Loan Parties" in its entirety and substituting the
following therefor:
"LOAN PARTIES" means, collectively, the Company and each
Subsidiary Guarantor.
2.12 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Note" and "Notes" in their entirety and substituting
the following therefor:
"NOTE" and "NOTES": as defined in paragraph 2.4(b).
2.13 The definition of "Remaining Interest Period" set forth in
Section 1.1 of the Credit Agreement is hereby amended by adding the phrase "or
paragraph 2.26" after the phrase "paragraph 2.2" in clause (i) thereof.
2.14 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Required Lenders" in its entirety and substituting
the following therefor:
"REQUIRED LENDERS": at any time when no Loans are outstanding
(whether or not Letters of Credit are then outstanding) or there are
R/C Loans, Liquidity Loans and Competitive Bid Loans outstanding,
Lenders having Commitments equal to more than 66 2/3% of the
Aggregate Commitments. At any time when only R/C Loans are
outstanding (whether or not Letters of Credit are then outstanding),
Lenders holding Original Notes having an unpaid principal balance
equal to more than 66 2/3% of the aggregate Loans outstanding. At
any time when only Liquidity Loans are outstanding (whether or not
Letters of Credit are then outstanding), Lenders
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holding Secured Liquidity Notes having an unpaid principal balance
equal to more than 66 2/3% of the aggregate Loans outstanding. At
any time when only Competitive Bid Loans are outstanding (whether or
not Letters of Credit are then outstanding), Lenders having
Commitments equal to more than 66 2/3% of the Aggregate Commitments
(whether used or unused), except that for purposes of paragraph
9.2(a)(i) and paragraphs 9.2(a)(ii)(B), the term "Required Lenders"
shall mean Lenders holding more than 66 2/3% of the outstanding
Competitive Bid Loans if no Letters of Credit are then outstanding,
but if Letters of Credit are also then outstanding, such term shall
mean Lenders holding more than 66 2/3% of the outstanding
Competitive Bid Loans and Lenders having more than 66 2/3% of the
Letter of Credit Exposure.
2.15 Section 1.1 of the Credit Agreement is hereby amended by
deleting the definition of "Type" in its entirety and substituting the following
therefor:
"TYPE": R/C Loans made hereunder as Base Rate Loans,
Eurodollar Loans or CD Loans, as the case may be and Liquidity Loans
made hereunder as Base Rate Loans or Eurodollar Loans, as the case
may be.
2.16 Section 2.4 of the Credit Agreement is hereby amended by (i)
renumbering the existing paragraph as Section 2.4(a), (ii) deleting each
reference therein to "Note" or "Notes" and substituting therefor "Original Note"
or "Original Notes", as the case may be, and (iii) adding a new Section 2.4(b)
at the end thereof to read in its entirety as follows:
(b) The Liquidity Loans made by each Lender shall be evidenced
by a promissory note of the Company, in form and substance
satisfactory to the Agent (each, as endorsed or modified from time
to time, including all replacements thereof and substitutions
therefor, a "SECURED LIQUIDITY NOTE" and, collectively with the
Secured Liquidity Notes of all other Lenders, the "SECURED LIQUIDITY
NOTES"; and together with the Original Note of such Lender, a "NOTE"
and, collectively with the Notes of all other Lenders, the "NOTES"),
payable to the order of such Lender and representing the obligation
of the Company to pay the lesser of (a) the amount of the Liquidity
Subfacility Amount or (b) such lesser amount as shall equal the
aggregate unpaid principal balance of all Liquidity Loans made by
such Lender, in each case with interest thereon as prescribed in
paragraph 2.8. Each Lender is hereby authorized to record (i) the
date and amount of each Liquidity Loan made by such Lender, (ii) its
character as a Base Rate Loan, a Eurodollar Loan, or a combination
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thereof, (iii) the Interest Period and interest rate applicable to
Eurodollar Loans, and (iv) the date and amount of each conversion
of, and each payment or prepayment of principal of, any Liquidity
Loans, on the schedule (and any continuations thereof) annexed to
and constituting a part of its Secured Liquidity Note. No failure to
so record or any error in so recording shall affect the obligation
of the Company to repay the Liquidity Loans, with interest thereon,
as herein provided. Each Secured Liquidity Note shall (1) be dated
the first Liquidity Borrowing Date, (2) be stated to mature on the
Liquidity Subfacility Termination Date, and (3) bear interest for
the period from and including the date thereof on the unpaid
principal balance thereof from time to time outstanding at the
applicable interest rate or rates per annum determined as provided
in paragraph 2.8. Interest on each Secured Liquidity Note shall be
payable as specified in paragraph 2.8.
2.17 Section 2.5(a) of the Credit Agreement is hereby amended by
adding the phrase ", Liquidity Loans" immediately after the phrase "R/C Loans"
in the first sentence thereof.
2.18 Section 2.6(a) of the Credit Agreement is hereby amended by (i)
adding the phrase "or Liquidity Loans" immediately after the term "R/C Loans" in
the first sentence thereof, (ii) adding the phrase "or Liquidity Loans, as the
case may be" after the term "R/C Loans" in the fifth sentence thereof and (iii)
adding a new sentence at the end thereof to read in its entirety as follows:
Upon each prepayment of the Liquidity Loans under this paragraph
2.6(a), the Liquidity Subfacility Amount shall be permanently
reduced by the principal amount of such prepayment.
2.19 Section 2.6(b) of the Credit Agreement is hereby deleted in its
entirety and the following substituted therefor:
(b) MANDATORY PREPAYMENTS.
(i) The Company shall prepay the R/C Loans and the
Competitive Bid Loans in the amounts, if any, and on the dates set
forth in paragraph 2.18(a) or paragraph 2.18(b).
(ii) In addition to any other mandatory repayments or
commitment reductions pursuant to this paragraph 2.6(b), on each
date after the Amendment No. 3 Effective Date upon which the Company
or any of its Subsidiaries shall receive any proceeds from any sale,
assignment, transfer or other disposition of any Property
constituting all or any part of the Collateral, the Liquidity
Subfacility Amount shall be permanently reduced and the Company
shall prepay
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the aggregate unpaid Liquidity Loans in an amount equal to 100% of
the Net Cash Proceeds with respect to such sale, assignment,
transfer or other disposition.
2.20 Section 2.8 of the Credit Agreement is hereby amended by (i)
deleting the third parenthetical phrase in the first sentence of Section 2.8(b)
in its entirety and substituting "(as determined under paragraph 2.3 or as set
forth in paragraph 2.8(a) or 2.8(d))" therefor and (ii) adding a new Section
2.8(d) at the end thereof to read in its entirety as follows:
(d) LIQUIDITY LOANS PRIOR TO MATURITY. Prior to maturity, the
outstanding principal balance of the Liquidity Loans shall bear
interest on the unpaid principal balance thereof at the applicable
interest rate or rates per annum set forth below:
LOAN TYPE RATE
Each Base Rate Loan Base Rate plus 1.00%
Each Eurodollar Loan Eurodollar Rate for the
applicable Interest Period
plus 3.00%
2.21 Section 2 of the Credit Agreement is hereby amended by adding
new Sections 2.26 and 2.27 to read in their entirety as follows:
2.26 LIQUIDITY LOANS.
(a) Subject to the terms and conditions of this
Agreement, each Lender severally agrees to make Liquidity Loans to
the Company from time to time during the Liquidity Availability
Period in an aggregate principal amount at any one time outstanding
not to exceed such Lender's Commitment Percentage of the Liquidity
Subfacility Amount, provided that (i) the aggregate unpaid principal
balance of all Liquidity Loans at any one time outstanding shall not
exceed the Liquidity Subfacility Amount and (ii) the aggregate
unpaid principal balance of all Liquidity Loans, R/C Loans and
Competitive Bid Loans at any one time outstanding, plus the Letter
of Credit Exposure at such time, shall not exceed the Aggregate
Commitments. During such period, the Company may borrow, prepay in
whole or in part and reborrow Liquidity Loans, all in accordance
with the terms and conditions hereof. Subject to the provisions of
paragraphs 2.3 and 2.7, Liquidity Loans may be (a) Base Rate Loans
or (b) Eurodollar Loans, or any combination thereof. Notwithstanding
the foregoing, in the event that the Agent shall not have obtained a
perfected first
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priority Lien (or the equivalent thereof under the relevant local
law) on the Non-Domestic Collateral on or before the Liquidity
Subfacility Effective Date except for the Collateral described in
the proviso to paragraph 2.27(a), the aggregate unpaid principal
balance of all Liquidity Loans outstanding at any one time shall not
exceed the lesser of $30,000,000 and the Liquidity Subfacility
Amount at such time until the Agent shall have obtained a perfected
first priority Lien (or the equivalent thereof under the relevant
local law) on the Non-Domestic Collateral. Upon the Agent obtaining
a perfected first priority Lien (or the equivalent thereof under the
relevant local law) on the Non-Domestic Collateral pursuant to (and
subject to the limitations set forth in) paragraph 2.27, the
aggregate unpaid principal balance of all Liquidity Loans
outstanding at any one time shall not exceed the Liquidity
Subfacility Amount, subject to the provisions of the first sentence
of this paragraph 2.26(a).
(b) The Company may borrow Liquidity Loans on any
Business Day occurring on or after the Liquidity Subfacility
Effective Date and ending on the Liquidity Subfacility Termination
Date, by giving the Agent an irrevocable telephonic (to be promptly
confirmed in writing) or fax or other written notice of borrowing
(each a "LIQUIDITY BORROWING REQUEST") no later than 11:00 A.M., New
York City time, three Business Days prior to each requested
Borrowing Date, in the case of Eurodollar Loans, and no later than
11:00 A.M., New York City time, two Business days prior to the
requested Borrowing Date, in the case of Base Rate Loans, specifying
(i) the aggregate amount of Liquidity Loans to be borrowed, (ii) the
requested Borrowing Date, and (iii) whether the borrowing is to be
of Eurodollar Loans, Base Rate Loans, or a combination thereof. Each
borrowing of Eurodollar Loans comprising all or a portion of a
Liquidity Borrowing shall be in an aggregate principal amount equal
to $5,000,000 or such amount plus a whole multiple of $1,000,000.
Each borrowing of Base Rate Loans comprising all or a portion of a
Liquidity Borrowing shall be in an aggregate principal amount equal
to $1,000,000 or such amount plus a whole multiple thereof or, if
less, the unused amount of the Liquidity Subfacility Amount. Upon
receipt of each notice of borrowing from the Company, the Agent
shall promptly notify each Lender thereof. Subject to its receipt of
the notice referred to in the preceding sentence, each Lender will
make the amount of its Commitment Percentage of each Liquidity
Borrowing available to the Agent for the account of the Company at
the office of the Agent set forth in paragraph 11.2 not later than
12:00 Noon, New York City time, on the Liquidity Borrowing Date
requested by the Company, in funds immediately available to the
Agent at such office.
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The amounts so made available to the Agent on a Liquidity Borrowing
Date will then, subject to the satisfaction of the terms and
conditions of this Agreement as determined by the Agent, be made
available on such date to the Company by the Agent at the office of
the Agent specified in paragraph 11.2 by crediting the account of
the Company on the books of such office with the aggregate of said
amounts in like funds as received by the Agent.
(c) Unless the Agent shall have received prior notice
from a Lender (by telephone or otherwise, such notice to be
confirmed by fax or other writing) that such Lender will not make
available to the Agent such Lenders' pro rata share of the Liquidity
Loans requested by the Company, the Agent may assume that such
Lender has made such share available to the Agent on such Liquidity
Borrowing Date in accordance with this paragraph, provided that such
Lender received notice of the proposed Liquidity Borrowing from the
Agent, and the Agent may, in reliance upon such assumption, make
available to the Company on such Liquidity Borrowing Date a
corresponding amount. If and to the extent such Lender shall not
have so made such pro rata share available to the Agent, such Lender
and the Company severally agree to pay without duplication to the
Agent forthwith on demand such corresponding amount (to the extent
not previously paid by the other), together with interest thereon
for each day from the date such amount is made available to the
Company until the date such amount is paid to the Agent, at a rate
per annum equal to, in the case of the Company, the applicable
interest rate set forth in paragraph 2.8, and, in the case of such
Lender, the Federal Funds Rate in effect on each such day (as
determined by the Agent). Such payment by the Company, however,
shall be without prejudice to its rights against such Lender. If
such Lender shall pay to the Agent such corresponding amount, such
amount so paid shall constitute such Lender's Liquidity Loan as part
of such Liquidity Loans for purposes of this Agreement, which
Liquidity Loan shall be deemed to have been made by such Lender on
the Liquidity Borrowing Date applicable to such Liquidity Loans.
2.27. SECURITY
(a) In order to secure the due payment and performance
by the Company of its obligations in respect of the Liquidity Loans
and of the Subsidiary Guarantors of their obligations in respect of
the Subsidiary Guarantees (the "SUBFACILITY OBLIGATIONS"), the
Company shall, and cause the Subsidiary Guarantors to, grant to the
Agent for the ratable benefit of the Lenders
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a Lien on the Collateral in accordance with the Security Documents;
provided, however, that nothing in this Agreement or any of the
other Loan Documents shall require the Company or any Subsidiary
Guarantor to grant to the Agent a Lien on any Non-Domestic
Collateral (other than pursuant to the Czech Loan Assignment and the
Czech Mortgage) to the extent (and only to the extent) that the
granting of such Lien (i) would violate the terms of any material
written agreement to which the Company or any Subsidiary Guarantor
is a party or by which the Company, any Subsidiary Guarantor or such
Non-Domestic Collateral is bound as of the Liquidity Subfacility
Effective Date, (ii) contravene any applicable law, statute, rule or
regulation or any order, writ, injunction or decree of any
Governmental Body or (iii) result in material adverse tax
consequences to the Company.
(b) In the event that the Company or any Subsidiary
Guarantor is unable as a result of the circumstances described in
clauses (i), (ii) or (iii) of paragraph 2.27(a) to grant to the
Agent a Lien on any of the Non-Domestic Collateral, the Company
shall deliver to the Agent a certificate (the "COLLATERAL
CERTIFICATE") in form and substance satisfactory to the Agent
identifying the Collateral on which the Agent will not obtain a Lien
and setting forth in reasonable detail the reasons that the Company
or such Subsidiary Guarantor is unable to grant such Lien, together
with such supporting documentation (including, without limitation,
copies of agreements translated into English and calculations of
estimated tax consequences) as the Agent may reasonably request.
(c) Upon receipt by the Agent with respect to each
Non-Domestic Subsidiary of (i) a Lien on the Non-Domestic Collateral
in accordance with this Agreement and the Security Documents or (ii)
one or more Collateral Certificates with respect to the Non-Domestic
Collateral on which the Agent is not entitled to obtain a Lien
pursuant to the proviso to paragraph 2.27(a), the Agent shall
promptly notify each Lender in writing of the receipt by the Agent
of such Liens and certificates and the date, which shall be a date
not earlier than 3 Business Days after the date of such notice, on
which the limitation on the outstanding principal amount of
Liquidity Loans set forth in the penultimate sentence of paragraph
2.26(a) shall terminate which shall be not later than 5 Business
Days after the Agent shall have received such Liens and
Certificates.
(d) Provided no Default or Event of Default has occurred
and is continuing, the Agent and the Lenders promptly will:
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(i) release their security interest in the
Collateral (including the Disbursement Account but not the Reserve
Account) upon the written request of the Company after Ogden
Services Corporation shall have deposited Net Cash Proceeds received
by Ogden Services Corporation from the sale of the "food and
beverage" business of not less than $51,000,000 in the Reserve
Account as substitute collateral for the Collateral; and
(ii) release their security interest in the
Collateral (including the Disbursement Account and the Reserve
Account) upon (A) the repayment in full of the Liquidity Loans and
all accrued interest thereon and the termination of the Liquidity
Subfacility, (B) the cancellation of the Liquidity Subfacility by
the Company at any time that no Liquidity Loans are outstanding or
(C) receipt by the Agent of Net Cash Proceeds from the sale of the
Aviation Business and the simultaneous repayment in full of the
Liquidity Loans and all accrued interest thereon and termination of
the Liquidity Subfacility, which release shall be simultaneously
with such sale and the receipt of such Net Cash Proceeds and
repayment. The Agent and the Lenders shall execute and deliver to
the Company such instruments and documents as the Company may
reasonably request to evidence such release, at the sole cost and
expense of the Company.
2.22 Section 3.1(a) of the Credit Agreement is hereby amended by
adding the phrase "and all Liquidity Loans" after the phrase "all R/C Loans" in
subclause (i) of clause (b) of the first sentence thereof.
2.23 Section 3.2 of the Credit Agreement is hereby amended by
deleting the first two sentences thereof in their entirety and substituting the
following therefor:
With respect to the R/C Loans and Liquidity Loans, each
borrowing by the Company from the Lenders, any conversion of R/C
Loans or Liquidity Loans from one Type to another, and any reduction
of the Commitments (other than a reduction arising under paragraph
2.18), shall be made pro rata according to the Commitment Percentage
of each Lender. All payments (including prepayments) made by the
Company to the Agent on account of principal of or interest on the
R/C Loans and the Liquidity Loans, all payments in respect of
unreimbursed obligations for the Letters of Credit, and any
reduction of the participation in the face amount of a Letter of
Credit, shall be made pro rata according to the outstanding
principal amount of each Lender's R/C Loans or Liquidity Loans, as
the case may be, and all payments (including prepayments) made by
the Company on account of principal of or interest on the
Competitive Bid Loans comprising
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the same Competitive Bid Borrowing shall be made as specified in
paragraphs 2.3(c) and 2.3(d).
2.24 Section 6.3 of the Credit Agreement is hereby deleted in its
entirety and the following substituted therefor:
6.3 BORROWING REQUEST.
With respect to any request for Loans or the issuance of
a Letter of Credit, the Agent shall have received an R/C Borrowing
Request, a Liquidity Borrowing Request, a Competitive Bid Borrowing
Request or L/C Issuance Request, as the case may be, duly executed
by an Authorized Signatory of the Company, accompanied by, with
respect to each request for a Letter of Credit, an Application for
Letter of Credit.
2.25 Section 7.1 of the Credit Agreement is hereby amended by
adding the following new Section 7.1(d) at the end thereof to read in its
entirety as follows:
(d) concurrently with any delivery of financial statements
under subsection (a) above commencing with fiscal year 2000, a
certificate executed by the Chief Financial Officer and the general
counsel of the Company (i) setting forth the information required
pursuant to Section 2 of the Perfection Certificate or confirming
that there has been no change in such information since the date of
such certificate or the date of the most recent certificate
delivered pursuant to this subsection (d), (ii) certifying that all
Uniform Commercial Code financing statements or other appropriate
filings, recordings or registrations, including all refilings,
rerecordings and re-registrations, containing a description of the
Collateral have been filed of record in each governmental, municipal
or other appropriate office in each jurisdiction identified pursuant
to clause (i) above in accordance with the Security Documents and
(iii) identifying in the format of Schedule 8 to the Perfection
Certificate Equity Interests (as defined in the Security Agreement),
of the Company and each Subsidiary Guarantor in existence on the
date thereof and not then listed on such Schedules or previously so
identified to the Agent.
2.26 Section 7 of the Credit Agreement is hereby amended by adding
a new Section 7.12 to read in its entirety as follows:
7.12 ADDITIONAL SUBSIDIARIES.
In the event that on or after the Amendment No. 3 Effective
Date, any Person shall become a Subsidiary of
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Ogden Aviation or of any of its Subsidiaries (other than solely as a
result of the corporate reorganization of the Company's aviation
business and such Person is a party to, and such Person's assets and
Capital Stock are subject to, the Security Documents), the Company
shall (i) notify the Agent in writing thereof within three Business
Days thereof, (ii) cause such Person to execute and deliver to the
Agent a Guarantee Supplement and to become a party to each
applicable Security Document in the manner provided therein within
five Business Days thereafter and to promptly take such actions to
create and perfect Liens on such Person's assets to secure such
Person's obligations under the Loan Documents as the Agent or the
Required Lenders shall reasonably request in accordance with the
Security Documents, (iii) cause any shares of Stock of such new
Subsidiary owned by or on behalf of any Loan Party to be pledged
pursuant to the Security Agreement within five Business Days
thereafter, (iv) cause each such new Subsidiary to deliver to the
Agent any shares of Stock of any Subsidiary that are owned by or on
behalf of such new Subsidiary within five Business Days after such
Subsidiary is formed or acquired in accordance with the Security
Documents, and (v) deliver to the Agent a Perfection Certificate
with respect to such Subsidiary, such additional Financing
Statements, Grants of Security Interest and Powers of Attorney (as
each such term is defined in the Security Agreement) certificates,
instruments and opinions as the Agent may request.
2.27 Section 11.1 of the Credit Agreement is hereby amended by (i)
adding new clauses (x) and (xi) at the end of the first proviso thereof to read
in their entirety as follows:
or (x) release any Subsidiary Guarantor from its obligations under
the Subsidiary Guarantee (except as expressly provided therein,
under paragraphs 2.25(e) and 2.27(d) or as a result of the
termination of the existence of such Subsidiary Guarantor in a
transaction permitted by paragraph 8.6), or (xi) release all or
substantially all of the Collateral from the Liens of the Security
Documents (except as may be expressly permitted thereunder, under
paragraphs 2.25(e) or 2.27(d) or in connection with a transaction
permitted by paragraph 8.6)
and (ii) by adding a new sentence at the end thereof to read in its
entirety as follows:
Notwithstanding the foregoing, the Agent, the Lenders and the
Company acknowledge and agree that paragraph 2.25 (Disbursement
Account, Reserve Account and Collateral for Subfacility) may not be
amended to (x) limit the set off rights of the Agent in respect of
the Disbursement Account and the Reserve Account as set forth in
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paragraph 2.25, (y) change the provisions relating to the
application of any amounts set off by the Agent in respect of the
Disbursement Account or the Reserve Account in excess of the amounts
necessary to satisfy the Subfacility Obligations or (z) change the
provisions relating to the disbursement of funds from the
Disbursement Account and the Reserve Account, without the consent of
the Agent, the Required Lenders and the requisite creditors under
the Credit Facility Indebtedness.
3. CONDITIONS TO EFFECTIVENESS OF AMENDMENT.
3.1 The effectiveness of the amendments set forth in Sections 1 and
2 of this Amendment No. 3 is subject to the prior or simultaneous fulfillment of
the following conditions on or before 4:00 P.M. New York City time on April 27,
2000:
(a) The Agent shall have received this Amendment No. 3 executed
by (i) a duly authorized officer or officers of the Company and (ii) the
Required Lenders;
(b) The Agent shall have received such other documents as it
shall have reasonably requested consistent with the terms hereof;
(c) Holders of Indebtedness under any Covenant Credit Facility
shall have executed, to the extent required by each such Covenant Credit
Facility, waivers or amendments to such credit facilities satisfactory to the
Agent and the Required Lenders (i) containing amendments to the covenants and
related definitions in such credit facilities identical to those set forth in
Section 1 of this Amendment No. 3 and (ii) containing agreements by such holders
to (A) waive compliance by the Company or any of its Subsidiaries with, or
amend, any provision of any instrument, document or agreement evidencing such
Indebtedness requiring the sharing of any collateral securing the Liquidity
Loans and (B) waive any default or event of default currently existing or
occurring as a result of (x) the incurrence by the Company of Indebtedness under
the Liquidity Loan subfacility, (y) the Guarantee by the Guarantors of the
obligations of the Company in respect of the Liquidity Loans or (z) the granting
of the liens and security interest to secure the obligations in respect of the
Liquidity Loans and the obligations of the Subsidiary Guarantors under the
Subsidiary Guarantee;
(d) The Agent shall have received payment of all of its
out-of-pocket expenses, including the reasonable fees and expenses of its
counsel Emmet, Marvin & Martin, LLP incurred in connection with this Amendment
No. 3;
(e) The Agent shall have received the arrangement fee due to the
Agent pursuant to the agreement between the Agent and the Company;
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(f) The Agent shall have received confirmation that the
attorneys and accountants for the Steering Committee have received retainer
payments of $500,000 in the aggregate;
(g) The Agent shall have received (i) a non-refundable
Subfacility fee, for the pro-rata benefit of the Lenders, equal to $1,000,000
and (ii) a non-refundable amendment fee, for the pro-rata benefit of the
Lenders, equal to $187,500;
(h) The Agent shall have received for deposit in the
Disbursement Account and, if applicable, the Reserve Account the Net Cash
Proceeds of any Permitted Disposition closed prior to the Amendment No. 3
Effective Date; and
(i) The representations and warranties contained in the Credit
Agreement (other than the representations and warranties made as of a specific
date) shall be true and correct in all material respects on and as of the
Amendment No. 3 Effective Date, other than such exceptions as set forth on a
disclosure certificate to be delivered to the Agent by the Company on or before
the Amendment No. 3 Effective Date so long as such exceptions do not disclose
the occurrence of a Material Adverse Change since the date of the Projections.
3.2 The date on which the conditions set forth in Section 3.1 are
satisfied is the "AMENDMENT NO. 3 EFFECTIVE DATE" and until the conditions set
forth in Section 3.1 are satisfied, the amendments set forth in Section 1 and 2
of this Amendment No. 3 are not effective. In the event that the conditions set
forth in Section 3.1 have not been satisfied on or before 4:00 p.m. New York
City time on April 27, 2000, this Amendment No. 3 shall terminate and shall be
of no force or effect.
4. CONDITIONS TO EFFECTIVENESS AND AVAILABILITY OF LIQUIDITY
SUBFACILITY.
4.1 The obligation of each Lender to make any Liquidity Loan up to
an aggregate principal amount of all Liquidity Loans for all Lenders of
$30,000,000 on a Liquidity Borrowing Date is subject to the satisfaction of the
following conditions precedent as of the date of such Liquidity Loan:
(a) The Agent shall have received the Secured Liquidity Notes
duly executed by an Authorized Signatory of the Company;
(b) The Agent shall have received a counterpart of each of the
Security Agreement, the Domestic Subsidiary Guarantee, and each other Domestic
Security Document, each dated the Liquidity Subfacility Effective Date, signed
by the Company and each Subsidiary party thereto (or a facsimile of a signature
page thereof signed by the Company and each such Subsidiary party thereto)
together with the following:
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(i) a completed Perfection Certificate, dated the Liquidity
Subfacility Effective Date and signed by both a Financial Officer and the
general counsel of the Company, together with all attachments contemplated
thereby;
(ii) one or more stock certificates, evidencing 100% of the
issued and outstanding Capital Stock of Ogden Aviation and each Domestic
Subsidiary owned by Ogden Aviation or any other Domestic Subsidiary
Guarantor (other than the Stock of the Subsidiaries in the Fuel Facilities
Group), in each case, together with undated stock powers with respect
thereto, executed in blank by the Company or such Domestic Subsidiary
Guarantor, as the case may be, and bearing a signature guarantee in all
respects satisfactory to the Agent, if requested by the Agent;
(iii) Uniform Commercial Code Financing Statements for each
Domestic Subsidiary Guarantor covering accounts receivable, goods,
machinery, equipment and other Collateral described in the Domestic
Security Documents, executed by such Domestic Subsidiary Guarantor
(subject, with respect to the Property described in part (b) of Schedule F
hereto to the Liens described on part (b) of Schedule F), for the
jurisdictions set forth on Schedule 3 to the Security Agreement;
(iv) executed counterparts of mortgages, deeds of trust or
similar documents in form and substance satisfactory to the Agent
(collectively, as amended, restated, supplemented or otherwise modified
from time to time, the "MORTGAGE") covering the real property of Ogden
Projects, Inc. located in --------- Fairfield, New Jersey, together with
mortgagee title insurance policies issued by title insurers reasonably
satisfactory to the Agent in amounts reasonably satisfactory to the Agent
(which policies shall include, without limitation, an endorsement for
future advances under the Credit Agreement), a survey, in form and
substance satisfactory to the Agent to such real property certified by a
licensed professional surveyor satisfactory to the Agent and such other
instruments, documents and agreements in connection with the execution,
delivery and recording of the Mortgage and granting of a Lien on such real
property in favor of the Agent as the Agent may reasonably request; and
(v) such instruments, documents and agreements as the Agent may
reasonably request in connection with the establishment of the
Disbursement Account and the Reserve Account, and the granting of a Lien
thereon in favor of the Agent for the benefit the Lenders;
(c) The Agent shall have received certificates, dated the Liquidity
Subfacility Effective Date, of the Secretary or Assistant Secretary of the
Company and each Domestic Subsidiary Guarantor (i) attaching a true and complete
copy of the resolutions of its Board of Directors and of all documents
evidencing other necessary corporate action (in form and substance satisfactory
to the Agent and to Special Counsel) taken by it to authorize this Amendment No.
3, the Loan Documents to be executed by it in connection herewith and the
transactions contemplated hereby and thereby, (ii) attaching a true and complete
copy of
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its certificate of incorporation and by-laws, and (iii) setting forth
the incumbency of its officer or officers who may sign the Loan Documents to
which it is a party, including therein a signature specimen of such officer or
officers, together with such other documents as the Agent or Special Counsel
shall reasonably require;
(d) There shall have occurred no Material Adverse Change and there
shall not exist any material litigation in respect of the Company, its
Subsidiaries or its businesses, or any material undisclosed liability of the
Company or any of its Subsidiaries, in each case since the date of the
Projections, and the Agent shall have received a certificate of an Authorized
Signatory of the Company to such effect;
(e) Each of the conditions set forth in Section 3.1 of this
Amendment No. 3 and in Section 6 of the Credit Agreement shall have been
satisfied;
(f) The Agent shall have received the financial statements of the
Company and its Subsidiaries described in Section 7.1(a) of the Credit Agreement
as at and for the year ending December 31, 1999, together with the unqualified
opinion of the Accountants with respect thereto;
(g) The Agent shall have received projected financial statements for
the energy division of the Company for the fiscal year ending December 31, 2000,
in form and substance satisfactory to the Agent and the Required Lenders;
(h) The Agent shall have received such other documents as it shall
have reasonably requested; and
(i) The Agent shall have received an opinion of counsel to the
Company and the Domestic Subsidiary Guarantors, addressed to the Agent and the
Lenders, dated the Liquidity Subfacility Effective Date, in form and substance
satisfactory to the Special Counsel.
4.2 The obligation of the Lenders to make any Liquidity Loan in excess of
an aggregate principal amount of $30,000,000 on a Liquidity Borrowing Date is
subject to the satisfaction of the following conditions precedent as of the date
of such Liquidity Loan:
(a) The Agent shall have received with respect to each Non-Domestic
Subsidiary Guarantor (1) the Czech Loan Assignment and the Czech Mortgage and
(2) (x) a Collateral Certificate and/or (y) a counterpart of each of the other
Non-Domestic Security Instrument, in each case executed by the Company and such
Non-Domestic Subsidiary Guarantor (or a facsimile of a signature page thereof
signed by the Company and such Non-Domestic Subsidiary Guarantor) together with
the following:
(i) a completed Perfection Certificate, signed by both a
Financial Officer and the general counsel of the Company, together with
all
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attachments contemplated thereby, with respect to each Non-Domestic
Subsidiary Guarantor; and
(ii) one or more stock certificates, evidencing not less
than 65% of the issued and outstanding Capital Stock of each
Non-Domestic Subsidiary owned by Ogden Aviation or any other
Subsidiary Guarantor, in each case, together with undated stock powers
(or the equivalent, if any, under local law) with respect thereto,
executed in blank by the Company or such Subsidiary Guarantor, as the
case may be, and bearing a signature guarantee in all respects
satisfactory to the Agent, if requested by the Agent;
(b) The Agent shall have received certificates, dated the
Liquidity Subfacility Effective Date, of the Secretary or Assistant Secretary of
each Non-Domestic Subsidiary Guarantor (i) attaching a true and complete copy of
the resolutions of its Board of Directors and of all documents evidencing other
necessary corporate action (in form and substance satisfactory to the Agent and
to Special Counsel) taken by it to authorize the Non-Domestic Security
Instruments to be executed by it and the transactions contemplated thereby, (ii)
attaching a true and complete copy of its certificate of incorporation and
by-laws, and (iii) setting forth the incumbency of its officer or officers who
may sign the Loan Documents to which it is a party, including therein a
signature specimen of such officer or officers, together with such other
documents as the Agent or Special Counsel shall reasonably require;
(c) There shall have occurred no Material Adverse Change and
there shall not exist any material litigation in respect of the Company, its
Subsidiaries or its businesses, or any material undisclosed liability of the
Company or any of its Subsidiaries, in each case since the date of the
Projections;
(d) Each of the conditions set forth in Section 6 of the Credit
Agreement shall have been satisfied; and
(e) The Agent shall have received such other documents as it
shall have reasonably requested.
4.3 The date on which the conditions set forth in Section 4.1 are
satisfied is the "LIQUIDITY SUBFACILITY EFFECTIVE DATE".
5. ACKNOWLEDGMENTS, REPRESENTATIONS AND WARRANTIES AND AGREEMENTS.
5.1 The Company hereby (a) reaffirms and admits the validity and
enforceability of the Credit Agreement and the other Loan Documents and all of
its obligations thereunder, and (b) represents and warrants to the Agent and
each Lender:
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(i) As of the date hereof, there exists no Default or Event of
Default.
(ii) The Company has full corporate power and authority to enter
into, execute, deliver and carry out the terms of this Amendment No. 3 and the
Loan Documents to which it is a party, and to make the borrowings and to incur
the other obligations contemplated hereby and thereby, to issue, deliver and
carry out the terms of the Secured Liquidity Notes and to incur the obligations
provided for in the Credit Agreement as amended hereby and in the Secured
Liquidity Notes, all of which have been duly authorized by all proper and
necessary corporate action and are not in violation of its Restated Certificate
of Incorporation or By-Laws.
(iii) Each Subsidiary Guarantor has full corporate power and
authority to enter into, execute, deliver and carry out the terms of the Loan
Documents to which it is a party and to incur the obligations contemplated
thereby, all of which have been duly authorized by all proper and necessary
corporate action and are not in violation of its Certificate of Incorporation or
By-Laws (or equivalent governing documents).
(iv) No consent, authority or approval of, filing with, notice to,
or exemption by, stockholders, any Governmental Body or any other Person (except
for those which have been obtained, made or given) is required to authorize, or
is required in connection with the execution, delivery and performance of this
Amendment No. 3, the Credit Agreement as amended hereby or any Loan Document, or
is required as a condition to the validity or enforceability of this Amendment
No. 3, the Credit Agreement as amended hereby or any Loan Document. No provision
of any applicable statute, law (including, without limitation, any applicable
usury or similar law), rule or regulation of any Governmental Body will prevent
the execution, delivery or performance of, or affect the validity of, this
Amendment No. 3, the Credit Agreement as amended hereby or any Loan Document.
(v) This Amendment No. 3 constitutes, and the Loan Documents to be
executed and delivered in connection herewith, when issued, executed and
delivered pursuant hereto for value received, will constitute, the valid and
legally binding obligations of the Company and the Subsidiary Guarantors
enforceable in accordance with their respective terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or similar laws affecting enforcement of creditors' rights
generally or by general principles of equity.
(vi) The execution, delivery, carrying out of the terms of this
Amendment No. 3, the Credit Agreement, as amended hereby and the Loan Documents
(including, without limitation, the granting of a Lien on the Collateral
pursuant to the Security Documents) or the borrowing of any Liquidity Loan will
not constitute a default under, conflict with, require any consent under (other
than consents which have been obtained), or result in the creation or imposition
of, or obligation to create, any Lien upon the Property or assets of the Company
or any of its Subsidiaries pursuant to the terms of any
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mortgage, indenture (including, without limitation, the 1992 Senior Note
Indenture), contract, agreement, judgment, decree or order.
(vii) Schedule D to this Amendment No. 3 sets forth a true, correct
and complete list of all Covenant Credit Facilities and each holder of any
Indebtedness under any such facility as of the date hereof.
(viii) Ogden Services Corporation is a direct, wholly-owned
Subsidiary of the Company. Ogden Services Corporation on the Amendment No. 3
Effective Date owns beneficially and of record the Stock of the Subsidiaries
that own all of the Property and assets of the Aviation Business (except for the
Company's direct minority interest in the joint venture, Aeropuentos Argentina
2000 S.A.) and the Company's discontinued entertainment business (including the
Stock of the Company's Subsidiaries that own the discontinued food and beverage
business), and except for Ogden Allied Maintenance Securities Inc., the Fuel
Facilities Group, Ogden Flight Services Group, Inc., Ogden Flight Properties,
Inc. and FRC Holdings, Inc., has owned such Subsidiaries, Properties and assets
for not less than five years (or such shorter time period as such Subsidiaries,
Properties and assets have been owned directly or indirectly by the Company).
(ix) All Disposition Related Debt either (a) is secured by a Lien on
the Property being sold in the Permitted Disposition related thereto or (b) is a
direct obligation of (i) the Subsidiary that owns the Property being sold in
such Permitted Disposition or (ii) a Subsidiary whose right to the proceeds of
such sale is structurally senior to any such right of the Company. All
Disposition Related Debt paid upon sale shall be paid solely from the proceeds
of sale.
(x) The sole assets of the Subsidiaries that comprise the Fuel
Facilities Group are pipes, tanks and related structures owned or held for the
benefit of airlines serviced by the Fuel Facilities Group.
5.2 The Company specifically and unconditionally acknowledges and
reaffirms its indebtedness to the Agent and the Lenders in the outstanding
principal amount of $50,000,000 under the terms of the Credit Agreement and the
other Loan Documents, together with all accrued and unpaid interest to the date
hereof, interest to be accrued and other costs, charges and expenses as may
accrue or become due under the terms of the Credit Agreement and the other Loan
Documents, including but not limited to reasonable fees and expenses of counsel.
The Company acknowledges and agrees that if and to the extent it maintains any
defenses to its obligations under the Credit Agreement and the other Loan
Documents arising through and including the date hereof, such defenses are
hereby waived and released as a specific condition to the agreements of the
Agent and the Lenders set forth herein, which waiver and release are
unconditional and without limitation.
5.3 The Company hereby acknowledges that all sales, assignments, transfers
or other dispositions of Property (other than the Property described on
Schedules B-1, B-2 and B-3 hereto and sales, assignments, transfers or other
dispositions of Property
43
<PAGE>
permitted by Section 8.6 of the Credit Agreement) after the Amendment No. 3
Effective Date shall be subject to the prior review and written consent of the
Agent and the Required Lenders.
5.4 All references to "this Agreement" in the Credit Agreement and
to "the Credit Agreement" in the other Loan Documents shall be deemed to refer
to the Credit Agreement as amended by this Amendment No. 3. All reference to the
"representations and warranties" in the Credit Agreement or in the other Loan
Documents shall be deemed to include the representations and warranties set
forth in Section 5.1 of this Amendment No. 3.
5.5 Except as specifically set forth herein, the Credit Agreement
and the other Loan Documents shall remain in full force and effect in accordance
with their terms.
5.6 The Company hereby acknowledges that the Agent and the Lenders
and holders of the Credit Facility Indebtedness may form the Steering Committee
in order to, among other things, coordinate the monitoring of the Company's
performance and the repayment of the Company's and its Subsidiaries'
Indebtedness. In connection therewith, and without limiting the Company's
obligations under Section 11.5 of the Credit Agreement, the Company shall pay or
reimburse the Steering Committee for all of its reasonable fees and expenses,
including, without limitation, fees and expenses incurred in connection with the
engagement on behalf of the Steering Committee of an accounting firm and a law
firm selected by the Steering Committee in their discretion.
5.7 In the event that the Company shall pay or become obligated to
pay to any holder of any Credit Facility Indebtedness or any agent or trustee
for any syndicate of holders of any Credit Facility Indebtedness in connection
with the consent by such holder or syndicate of holders to the waiver or
amendment of any provision of any instrument, document or agreement evidencing
such Credit Facility Indebtedness to conform any such instrument, document or
agreement to the terms of the Credit Agreement (as amended hereby) and this
Amendment No. 3 any fee (each such fee a "CREDIT FACILITY FEE") in excess of
0.375% of the principal amount of such Credit Facility Indebtedness held by such
holder or syndicate of holders, the Company shall pay to the Agent for the
ratable benefit of the Lenders (simultaneously with the payment of each such
Credit Facility Fee) an additional non-refundable fee equal to the difference
between (x) the product of (i) a fraction, the numerator of which is the
aggregate amount of such Credit Facility Fee and the denominator of which is the
principal amount of such Credit Facility Indebtedness, multiplied by (ii)
$50,000,000 and (y) $187,500.
44
<PAGE>
5.8 Each of the Company, the Agent and each Lender acknowledges
that nothing in this Amendment No. 3 or the Credit Agreement as amended
hereby shall in any way limit the rights or remedies of the Agent and the
Lenders upon the occurrence and during the continuance of an Event of Default
or constitute a so-called "standstill agreement" (and neither this Amendment
No. 3 nor any of the other amendments to the documents governing the Credit
Facility Indebtedness shall be deemed to create any standstill obligation)
between (i) the Company and any of its creditors or (ii) among any of the
Company's creditors, and that each holder of indebtedness of the Company
(including, without limitation, Credit Facility Indebtedness) shall retain
all of its respective rights and remedies with respect to such indebtedness
in accordance with the terms thereof, at law or otherwise.
6. MISCELLANEOUS.
6.1 This Amendment No. 3 may be executed by facsimile and in any
number of counterparts, each of which shall be an original and all of which
shall constitute one agreement. It shall not be necessary in making proof of
this Amendment No. 3 to produce or account for more than one counterpart
signed by the party to be charged.
6.2 This Amendment No. 3 is being delivered in and is intended to
be performed in the State of New York and shall be construed and enforceable
in accordance with, and be governed by, the internal laws of the State of New
York without regard to principles of conflict of laws.
The parties hereto have caused this Amendment No. 3 to be duly executed
and delivered by their proper and duly authorized officers as of the day and
year first above written.
45
<PAGE>
AMENDMENT NO. 3 - REVOLVING CREDIT AGREEMENT
46
<PAGE>
AMENDMENT NO. 3 - REVOLVING CREDIT AGREEMENT
47
<PAGE>
AMENDMENT NO. 3 - REVOLVING CREDIT AGREEMENT
48
<PAGE>
Exhibit 11
OGDEN CORPORATION AND SUBSIDIARIES
DETAILS OF COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED MARCH 31,
--------------------------------------------------------------------------------------------------
2000 1999
------------------------------------------------- ----------------------------------------------
Income Shares Per-Share Income Shares Per-Share
(Numerator) (Denominator) Amount (Numerator) (Denominator) Amount
------------ -------------- -------------- ------------- -------------- --------------
(In thousands, except per share amounts)
<S> <C> <C> <C> <C> <C> <C>
Income (loss) from continuing
operations $ (4,174) $ 4,059
Less: preferred stock dividend 17 35
------------ -------------
Basic Earnings (Loss)
Per Share (4,191) 49,559 $ (0.08) 4,024 48,960 $ 0.08
============== ==============
Effect of Dilutive Securities:
Stock options (A) 494
Convertible preferred stock (A) 35 251
6% convertible debentures (A) (A)
5-3/4% convertible debentures (A) (A)
------------ -------------- -------------- ------------- -------------- --------------
Diluted Earnings (Loss)
Per Share $ (4,191) 49,559 $ (0.08) $ 4,059 49,705 $ 0.08
============ ============== ============== ============= ============== ==============
</TABLE>
(A) Antidilutive
Note:
Basic earnings per common share was computed by dividing net income, reduced by
preferred stock dividend requirements, by the weighted average of the number of
shares of common stock outstanding during each period.
Diluted earnings per common share was computed on the assumption that all
convertible debentures, convertible preferred stock, and stock options converted
or exercised during each period, or outstanding at the end of each period were
converted at the beginning of each period or the date of issuance or grant, if
dilutive. This computation provides for the elimination of related convertible
debenture interest and preferred dividends.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 80,223
<SECURITIES> 0
<RECEIVABLES> 271,686
<ALLOWANCES> 18,886
<INVENTORY> 12,126
<CURRENT-ASSETS> 1,132,397
<PP&E> 2,427,795
<DEPRECIATION> 594,091
<TOTAL-ASSETS> 3,642,750
<CURRENT-LIABILITIES> 660,315
<BONDS> 1,852,044
0
37
<COMMON> 24,806
<OTHER-SE> 385,365
<TOTAL-LIABILITY-AND-EQUITY> 3,642,750
<SALES> 9,629
<TOTAL-REVENUES> 236,006
<CGS> 10,228
<TOTAL-COSTS> 202,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 9,458
<INCOME-PRETAX> (3,453)
<INCOME-TAX> (603)
<INCOME-CONTINUING> (4,174)
<DISCONTINUED> (25,310)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (29,484)
<EPS-BASIC> ($0.59)
<EPS-DILUTED> ($0.59)
</TABLE>
