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Exhibit 10
BARNES & NOBLE, INC.
and
SUBSIDIARY GUARANTORS
CREDIT AGREEMENT
Dated as of October 12, 2000
THE CHASE MANHATTAN BANK,
as Administrative Agent
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TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is
attached but is inserted for convenience of reference only.
Page
Section 1. Definitions and Accounting Matters.............................. -1-
1.01 Certain Defined Terms.......................................... -1-
1.02 Accounting Terms and Determinations............................-12-
1.03 Types..........................................................-12-
Section 2. Commitments, Loans, Notes and Prepayments.......................-13-
2.01 Loans..........................................................-13-
2.02 Borrowings of Loans............................................-13-
2.03 Changes of Commitments.........................................-13-
2.04 Commitment Fees................................................-13-
2.05 Lending Offices................................................-13-
2.06 Several Obligations; Remedies Independent......................-13-
2.07 Notes..........................................................-14-
2.08 Optional Prepayments and Conversions or Continuations of Loans.-14-
Section 3. Payments of Principal and Interest..............................-14-
3.01 Repayment of Loans.............................................-14-
3.02 Interest.......................................................-14-
Section 4. Payments; Pro Rata Treatment; Computations; Etc.................-15-
4.01 Payments.......................................................-15-
4.02 Pro Rata Treatment.............................................-15-
4.03 Computations...................................................-16-
4.04 Minimum Amounts................................................-16-
4.05 Certain Notices................................................-16-
4.06 Non-Receipt of Funds by the Administrative Agent...............-17-
4.07 Sharing of Payments, Etc.......................................-17-
Section 5. Yield Protection, Etc...........................................-18-
5.01 Additional Costs...............................................-18-
5.02 Limitation on Types of Loans...................................-20-
5.03 Illegality.....................................................-20-
5.04 Treatment of Affected Loans....................................-21-
5.05 Compensation...................................................-21-
5.06 U.S. Taxes.....................................................-22-
5.07 Replacement of Certain Lenders.................................-22-
5.08 Consistent Treatment...........................................-23-
Section 6. Guarantee.......................................................-23-
6.01 Guarantee......................................................-23-
6.02 Obligations Unconditional......................................-23-
6.03 Reinstatement..................................................-24-
6.04 Subrogation....................................................-24-
6.05 Remedies.......................................................-24-
6.06 Continuing Guarantee...........................................-24-
6.07 Rights of Contribution.........................................-24-
6.08 Limitation on Guarantee Obligations............................-25-
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Page
6.09 Release of Guarantors..........................................-25-
Section 7. Conditions Precedent............................................-25-
7.01 Initial Loans..................................................-25-
7.02 Initial and Subsequent Extensions of Credit....................-26-
Section 8. Representations and Warranties..................................-27-
8.01 Corporate Existence............................................-27-
8.02 Financial Condition............................................-27-
8.03 Litigation.....................................................-27-
8.04 No Breach......................................................-27-
8.05 Action.........................................................-27-
8.06 Approvals......................................................-28-
8.07 Use of Credit..................................................-28-
8.08 ERISA..........................................................-28-
8.09 Taxes..........................................................-28-
8.10 Investment Company Act.........................................-28-
8.11 Public Utility Holding Company Act.............................-28-
8.12 Material Agreements and Liens..................................-28-
8.13 Environmental Matters..........................................-29-
8.14 Capitalization.................................................-29-
8.15 Subsidiaries, Etc..............................................-29-
8.16 True and Complete Disclosure...................................-29-
Section 9. Covenants of the Company........................................-30-
9.01 Financial Statements; Information; Etc.........................-30-
9.02 Litigation.....................................................-31-
9.03 Existence, Etc.................................................-32-
9.04 Insurance......................................................-32-
9.05 Prohibition of Fundamental Changes.............................-32-
9.06 Limitation on Liens............................................-33-
9.07 Indebtedness...................................................-34-
9.08 Investments....................................................-34-
9.09 Dividend Payments..............................................-35-
9.10 Financial Covenants............................................-36-
9.11 Capital Expenditures; Sale Lease-backs; Etc....................-36-
9.12 Subordinated Indebtedness......................................-36-
9.13 Lines of Business..............................................-37-
9.14 Transactions with Affiliates...................................-37-
9.15 Use of Proceeds................................................-37-
9.16 Certain Obligations Respecting Subsidiaries....................-37-
9.17 Additional Subsidiary Guarantors...............................-37-
9.18 Modifications of License Agreement.............................-38-
9.19 Sales of Accounts..............................................-38-
Section 10. Events of Default..............................................-38-
Section 11. The Administrative Agent.......................................-40-
11.01 Appointment, Powers and Immunities.............................-40-
11.02 Reliance by Administrative Agent...............................-40-
11.03 Defaults.......................................................-40-
11.04 Rights as a Lender.............................................-41-
11.05 Indemnification................................................-41-
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Page
11.06 Non-Reliance on Administrative Agent and Other Lenders.........-41-
11.07 Failure to Act.................................................-41-
11.08 Resignation or Removal of Administrative Agent.................-41-
Section 12. Miscellaneous..................................................-42-
12.01 Waiver.........................................................-42-
12.02 Notices........................................................-42-
12.03 Expenses, Etc..................................................-42-
12.04 Amendments, Etc................................................-43-
12.05 Successors and Assigns.........................................-43-
12.06 Assignments and Participations.................................-43-
12.07 Survival.......................................................-44-
12.08 Captions.......................................................-45-
12.09 Counterparts...................................................-45-
12.10 Governing Law; Submission to Jurisdiction......................-45-
12.11 Waiver of Jury Trial...........................................-45-
12.12 Complete Agreement.............................................-45-
12.13 Confidentiality................................................-45-
SCHEDULE I - Material Agreements and Liens
SCHEDULE II - Subsidiaries and Investments
EXHIBIT A - Form of Note
EXHIBIT B-1 - Form of Opinion of Counsel to the Obligors
EXHIBIT B-2 - Form of Opinion of Special New York Counsel to Chase
EXHIBIT C - Form of Compliance Certificate
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CREDIT AGREEMENT dated as of October 12, 2000, among: BARNES & NOBLE,
INC., a corporation duly organized and validly existing under the laws of the
State of Delaware (together with its successors and assigns, the "Company");
each of the Subsidiaries of the Company identified under the caption "SUBSIDIARY
GUARANTORS" on the signature pages hereto (each such Subsidiary and each other
Subsidiary of the Company that becomes a "Subsidiary Guarantor" pursuant to
Section 9.17 hereof, together with its successors and assigns, but excluding any
Released Guarantors, individually, a "Subsidiary Guarantor" and, collectively,
the "Subsidiary Guarantors" and, together with the Company, the "Obligors");
each of the lenders named under the caption "Lenders" on the signature pages
hereof (together with its successors and assigns, individually, a "Lender" and,
collectively, the "Lenders"); and THE CHASE MANHATTAN BANK, as agent for the
Lenders (in such capacity, together with its successors in such capacity, the
"Administrative Agent").
The Company and the Subsidiary Guarantors are engaged as an integrated
group in the business of distributing and selling books and related products,
and in related or complementary businesses, and in furnishing the required
supplies, services, equipment, credit and other facilities for such integrated
operation. This integrated operation requires financing on such a basis that
credit supplied to the Company be made available from time to time to the
Subsidiary Guarantors, as required for the continued successful operation of the
Obligors, separately, and the integrated operation of the Obligors as a whole.
The Obligors have requested that the Lenders extend credit to the Company (all
or a substantial portion of which will be made available by the Company to the
Subsidiary Guarantors) to an aggregate principal amount not exceeding
$100,000,000 for the Obligors' general corporate purposes.
To induce the Lenders to extend such credit, the Obligors desire to
enter into this Agreement, pursuant to which the Lenders will make loans to the
Company and each Subsidiary Guarantor will guarantee the loans so made to the
Company. Each Obligor expects to derive benefit, directly or indirectly, from
the credit so extended to the Company, both in its separate capacity and as a
member of the integrated group, because the successful operation of each Obligor
is dependent on the continued successful performance of the functions of the
integrated group as a whole.
Accordingly, the parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms. As used herein, the following terms shall
have the following meanings (all terms defined in this Section 1.01 or in other
provisions of this Agreement in the singular to have the same meanings when used
in the plural and vice versa):
"Affiliate" shall mean, as to any specified Person, any other Person
that directly or indirectly controls, or is under common control with, or is
controlled by, such specified Person and, if such other Person is an individual,
any member of the immediate family (including parents, spouse, children and
siblings) of such individual and any trust whose principal beneficiary is such
individual or one or more members of such immediate family and any Person who is
controlled by any such member or trust. As used in this definition, "control"
(including, with its correlative meanings, "controlled by" and "under common
control with") shall mean possession, directly or indirectly, of power to direct
or cause the direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, by contract or
otherwise), provided that, in any event, any Person that owns directly or
indirectly securities having 10% or more of the voting power for the election of
directors or other governing body of a corporation or 10% or more of the
partnership or other ownership interests of any other Person will be deemed to
control such corporation or other Person. Notwithstanding the foregoing, (a) no
individual shall be an Affiliate of the Company or any of its Subsidiaries
solely by reason of such individual being a director, officer or employee of the
Company or any of its Subsidiaries, (b) the Company and its Wholly Owned
Subsidiaries (other than Unrestricted Subsidiaries) shall not be Affiliates of
each other and (c) neither the Administrative Agent nor any Lender shall be an
Affiliate of the Company or any of its Subsidiaries.
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"Applicable Lending Office" shall mean for each Lender and for each
Loan, the "Lending Office" of such Lender (or of an affiliate of such Lender)
designated for such Loan, on the signature pages hereof or such other office of
such Lender (or of an affiliate of such Lender) as such Lender may from time to
time specify to the Administrative Agent and the Company as the office by which
its Loans are to be made and maintained.
"Applicable Margin" shall mean, (a) for each Base Rate Loan, 1% per
annum, and (b) for each Eurodollar Loan, 2% per annum.
"B. Dalton" shall mean B. Dalton Bookseller, Inc., a Minnesota
corporation.
"Bankruptcy Code" shall mean the Federal Bankruptcy Code of 1978, as
amended from time to time.
"Base Rate" shall mean, for any day, a rate per annum equal to the
higher of (a) the Federal Funds Rate for such day plus -1/2 of 1% and (b) the
Prime Rate for such day. Each change in any interest rate provided for herein
based upon the Base Rate resulting from a change in the Base Rate shall take
effect at the time of such change in the Base Rate.
"Base Rate Loans" shall mean Loans that bear interest at rates based
upon the Base Rate.
"Basic Documents" shall mean, collectively, this Agreement and the
Notes.
"Business Day" shall mean (a) any day on which commercial banks are not
authorized or required to close in New York City and (b) if such day relates to
a borrowing of, a payment or prepayment of principal of or interest on, a
Conversion of or into, or an Interest Period for, a Eurodollar Loan or a notice
by the Company with respect to any such borrowing, payment, prepayment,
Conversion or Interest Period, any day on which dealings in Dollar deposits are
carried out in the London interbank market.
"Capital Expenditures" shall mean, for any period, expenditures made by
the Company or any of its Consolidated Subsidiaries to acquire or construct
fixed assets, plant and equipment (including renewals, improvements and
replacements, but excluding repairs) during such period computed in accordance
with GAAP, other than Specified Capital Expenditures.
"Capital Lease Obligations" shall mean, for any Person, all obligations
of such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) Property to the extent such obligations are required
to be classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP, and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.
"Change of Control" shall mean the occurrence of any of the following:
(a) a majority of the members of the Board of Directors of the
Company no longer being composed of: (i) individuals who are members of
said Board on the date hereof, (ii) individuals whose election or
nomination to said Board was approved by individuals referred to in
clause (i) above constituting at the time of such election or
nomination at least a majority of said Board or (iii) individuals whose
election or nomination to said Board was approved by individuals
referred to in clauses (i) and (ii) above constituting at the time of
such election or nomination at least a majority of said Board; or
(b) any Unrelated Person or any two or more Unrelated Persons
that are deemed to be a "person" under Sections 13(d)(3) and 14(d)(2)
of the Securities Exchange Act of 1934, as amended, acquiring, directly
or indirectly, effective control (whether through legal or beneficial
ownership of capital stock of the Company, by contract or otherwise) of
more than 25% of the outstanding Voting Shares.
"Chase" shall mean The Chase Manhattan Bank, or any successor thereto.
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"Closing Date" shall mean the date on which the conditions precedent
specified in Section 7 hereof have been satisfied and on which the initial Loans
hereunder are made.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"College" shall mean Barnes & Noble College Bookstores, Inc., a New
York corporation.
"Commitment Termination Date" shall mean January 31, 2001.
"Commitments" shall mean, for each Lender, the obligation of such
Lender to make Loans in an aggregate principal amount at any one time
outstanding up to but not exceeding (a) in the case of a Lender that is a party
to this Agreement on the date hereof, the amount set forth opposite the name of
such Lender on the signature pages hereof under the caption "Commitment" and (b)
in the case of any other Lender, the aggregate amount of Commitments of other
Lenders acquired by it pursuant to Section 12.06 hereof. The original aggregate
principal amount of the Commitments is $100,000,000.
"Consolidated Subsidiary" shall mean, for any Person, each Subsidiary
(other than an Unrestricted Subsidiary or a Released Guarantor) of such Person
(whether now existing or hereafter created or acquired) the financial statements
of which shall be (or should have been) consolidated with the financial
statements of such Person in accordance with GAAP.
"Continue", "Continuation" and "Continued" shall refer to the
continuation pursuant to Section 2.08 hereof of a Eurodollar Loan from one
Interest Period to the next Interest Period.
"Convert", "Conversion" and "Converted" shall refer to a conversion
pursuant to Section 2.08 hereof of one Type of Loans into another Type of Loans,
which may be accompanied by the transfer by a Lender (at its sole discretion) of
a Loan from one Applicable Lending Office to another.
"Debt Service" shall mean, for any period, the sum for the Company and
its Consolidated Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP) of the following: (a) all Interest Expense
for such period plus (b) all payments of principal of Indebtedness (including,
without limitation, the principal component of any payments in respect of
Capital Lease Obligations, but excluding payments in respect of (i) the Loans,
and (ii) Indebtedness outstanding under the Existing Credit Agreement) scheduled
to be made during such period plus (c) all Capital Expenditures during such
period.
"Default" shall mean an Event of Default or an event that with notice
or lapse of time or both would become an Event of Default.
"Dividend Payment" shall mean dividends (in cash, Property or
obligations) on, or other payments or distributions on account of, or the
setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement or other acquisition of, any shares of any
class of stock of the Company or of any warrants, options or other rights to
acquire the same, but excluding dividends payable solely in shares of common
stock of the Company.
"Dollars" and "$" shall mean lawful money of the United States of
America.
"EBITDA" shall mean, for any period, the sum, for the Company and its
Consolidated Subsidiaries (determined on a consolidated basis, without
duplication, in accordance with GAAP), of the following: (a) net income
(calculated before income taxes, the LIFO Charge and any write-off of deferred
financing fees) for such period, plus (b) the aggregate amount of depreciation,
amortization and taxes for such period, plus (c) Interest Expense for such
period, plus (d) any accretion expense with respect to any Equity Rights of the
Company and its Consolidated Subsidiaries for such period, plus (e) all non-cash
charges taken during such period (including, without limitation, pursuant to
Statements No. 13 and 121 of the Financial Standards Accounting Board), plus (f)
net proceeds to the Company and its Consolidated Subsidiaries during such period
upon exercise of any Equity Rights issued to directors, officers or employees of
the Company or any of its Subsidiaries, plus (g) any loss (or minus any
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income) attributable to equity in Affiliates (other than Unrestricted
Subsidiaries) of the Company or any of its Consolidated Subsidiaries for such
period, minus (h) all extraordinary non-cash gains for such period.
"EBITDAR" shall mean, for any period, the sum, for the Company and its
Consolidated Subsidiaries (determined on a consolidated basis, without
duplication, in accordance with GAAP), of the following: (a) EBITDA for such
period plus (b) Rental Payments for such period.
"Eligible Assignee" shall mean (i) any commercial bank or other
financial institution organized under the laws of the United States of America
or any state thereof with assets of at least $5,000,000,000 and (ii) any
commercial bank or other financial institution organized under the laws of any
other country that is a member of the Organization for Economic Cooperation and
Development, or any political subdivision thereof, with assets of at least
$5,000,000,000 (or the equivalent in other currencies), combined capital and
surplus of at least $1,000,000,000 (or the equivalent in other currencies) and a
branch, office or agency located in the United States of America.
"Environmental Claim" shall mean, with respect to any Person, any
written or oral notice, claim, demand or other communication (collectively, a
"claim") by any other Person alleging or asserting such Person's liability for
investigatory costs, cleanup costs, governmental response costs, damages to
natural resources or other Property, personal injuries, fines or penalties
arising out of, based on or resulting from (a) the presence, or Release into the
environment, of any Hazardous Material at any location, whether or not owned by
such Person, or (b) circumstances forming the basis of any violation, or alleged
violation, by such Person of any Environmental Law. The term "Environmental
Claim" shall include, without limitation, any claim by any governmental
authority for enforcement, cleanup, removal, response, remedial or other actions
or damages pursuant to any Environmental Law, and any claim by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from the presence of Hazardous Materials or arising
from alleged injury or threat of injury to the environment.
"Environmental Laws" shall mean any and all present and future Federal,
state, local and foreign laws, rules or regulations, and any orders or decrees,
in each case as now or hereafter in effect, relating to the regulation or
protection of the environment or to emissions, discharges, releases or
threatened releases of pollutants, contaminants, chemicals or toxic or hazardous
substances or wastes into the indoor or outdoor environment, including, without
limitation, ambient air, soil, surface water, ground water, wetlands, land or
subsurface strata, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants or toxic or hazardous substances or wastes.
"Equity Financed" shall mean, in respect of Capital Expenditures or
Investments, any Capital Expenditures or Investments to the extent that:
(a) they are financed with the proceeds of an Equity Issuance
that occurred not more than 12 months prior to the date on which such
Capital Expenditures or Investments (as the case may be) were made, and
(b) the aggregate amount of all such Capital Expenditures and
Investments financed with the proceeds of any single Equity Issuance
does not exceed $35,000,000.
"Equity Issuance" shall mean (a) any issuance or sale by the Company
after the date of this Agreement of (i) any capital stock of the Company
(including Preferred Stock but excluding any capital stock of the Company issued
upon the exercise of the warrants or the options referred to in the
parenthetical in clause (ii) below or upon the conversion of any Preferred
Stock), (ii) any warrants or options exercisable in respect of capital stock of
the Company (other than warrants or options issued to directors, officers or
employees of the Company or any of its Subsidiaries) or (iii) any other security
or instrument representing an equity interest (or the right to obtain any equity
interest) in the Company or (b) the receipt by the Company or any of its
Subsidiaries (other than Unrestricted Subsidiaries or Released Guarantors) after
the date of this Agreement of any capital contribution (whether or not evidenced
by any equity security issued by the recipient of such contribution); provided
that Equity Issuance shall not include (x) any such issuance or sale by any
Subsidiary of the Company to the Company or any Wholly Owned Subsidiary (other
than an Unrestricted Subsidiary) of the Company or (y) any capital contribution
by the Company
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or any Wholly Owned Subsidiary (other than an Unrestricted Subsidiary) of the
Company to any Subsidiary (other than an Unrestricted Subsidiary) of the
Company.
"Equity Rights" shall mean, with respect to any Person, any outstanding
subscriptions, options, warrants, commitments, preemptive rights or agreements
of any kind (including, without limitation, any stockholders' or voting trust
agreements) for the issuance, sale, registration or voting of, or outstanding
securities convertible into, any additional shares of capital stock of any
class, or partnership or other ownership interests of any type in, such Person.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade or business that
is a member of any group of organizations (a) described in Section 414(b) or (c)
of the Code of which the Company is a member and (b) solely for purposes of
potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of
the Code and the lien created under Section 302(f) of ERISA and Section 412(n)
of the Code, described in Section 414(m) or (o) of the Code of which the Company
is a member.
"Eurodollar Loans" shall mean Loans the interest rates on which are
determined on the basis of rates referred to in the definition of "Eurodollar
Rate" in this Section 1.01.
"Eurodollar Rate" shall mean, with respect to any Eurodollar Loan for
any Interest Period therefor, the arithmetic mean (rounded upwards, if
necessary, to the nearest 1/100 of 1%), as determined by the Administrative
Agent, of the rates per annum (rounded upwards, if necessary, to the nearest
1/16 of 1%) quoted by the respective Reference Banks at approximately 11:00 a.m.
London time (or as soon thereafter as practicable) on the date two Business Days
prior to the first day of such Interest Period for the offering by the
respective Reference Banks to leading banks in the London interbank market of
Dollar deposits having a term comparable to such Interest Period and in an
amount comparable to the principal amount of the Eurodollar Loan to be made by
such Reference Bank for such Interest Period. If any Reference Bank (or a Wholly
Owned Subsidiary thereof) is not participating in any Eurodollar Loan during any
Interest Period therefor, the Eurodollar Rate for such Loan for such Interest
Period shall be determined by reference to the amount of the Loan that such
Reference Bank would have made or had outstanding had it been participating in
such Loan during such Interest Period. If any Reference Bank does not furnish
the Administrative Agent with a quote for purposes of determining the Eurodollar
Rate for any Loan for any Interest Period therefor, the Eurodollar Rate for such
Interest Period shall be determined by reference to the quote(s) of the other
Reference Bank(s).
"Event of Default" shall have the meaning assigned to such term in
Section 10 hereof.
"Excess Cash Flow" shall have the meaning assigned to such term in the
Existing Credit Agreement as in effect as of the date hereof.
"Existing Credit Agreement" shall mean the Credit Agreement dated as of
November 18, 1997 among the Company, the Subsidiary Guarantors, certain lenders
and Chase as agent for said lenders, as the same shall be modified and
supplemented and in effect from time to time.
"Federal Funds Rate" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day, provided that (a) if the day for which such rate is to
be determined is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day and (b) if such rate is not so
published for any Business Day, the Federal Funds Rate for such Business Day
shall be the average rate quoted to Chase on such Business Day on such
transactions as determined by the Administrative Agent.
"Fixed Charge Ratio" shall mean, as at any date, the ratio of the
following:
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(a) EBITDA for the period of four consecutive fiscal quarters
ending on or most recently ended prior to such date, to
(b) the sum of the following:
(i) Debt Service for such period, plus
(ii) the aggregate amount (without duplication) of
Investments in Affiliates for such period that either (x)
consist of equity interests or (y) constitute acquisitions of
the capital stock or assets of other companies (for which
purpose the amount of the Investment shall include the amount
of the consideration therefor together with the amount of any
liabilities assumed), minus
(iii) (A) Equity Financed Investments made in such
period and (B) Equity Financed Capital Expenditures made in
such period.
"Funded Debt" shall mean, as at any date, without duplication, the
aggregate principal amount of the Loans outstanding on such date plus the
aggregate amount of Capital Lease Obligations on such date plus the aggregate
amount of any Indebtedness of the Company or any of its Subsidiaries (other than
Unrestricted Subsidiaries and Released Guarantors) of the type described in
clause (a), (b), (d) or (f) (but only insofar as Indebtedness of the type
described in clause (f) constitutes a Guarantee of Indebtedness of the type
described in clause (a), (b) or (d)) of the definition of "Indebtedness" in this
Section 1.01 permitted to be outstanding pursuant to Section 9.07 hereof.
"GAAP" shall mean generally accepted accounting principles applied on a
basis consistent with those which, in accordance with Section 1.02(a) hereof,
are to be used in making the calculations for purposes of determining compliance
with this Agreement.
"Guarantee" shall mean a guarantee, an endorsement, a contingent
agreement to purchase or to furnish funds for the payment or maintenance of, or
otherwise to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or earnings of any
Person, or a guarantee of the payment of dividends or other distributions upon
the stock or equity interests of any Person, or an agreement to purchase, sell
or lease (as lessee or lessor) Property, products, materials, supplies or
services primarily for the purpose of enabling a debtor to make payment of such
debtor's obligations or an agreement to assure a creditor against loss, and
including, without limitation, causing a bank or other financial institution to
issue a letter of credit or other similar instrument for the benefit of another
Person, but excluding (i) endorsements for collection or deposit in the ordinary
course of business and (ii) Rental Payments made to a lessor in the ordinary
course of business so long as there is no obligation to any Person (other than
such lessor) that may benefit from, or rely on, such Rental Payments. The terms
"Guarantee" and "Guaranteed" used as a verb shall have a correlative meaning.
"Hazardous Material" shall mean, collectively, (a) any petroleum or
petroleum products, flammable explosives, radioactive materials, asbestos in any
form that is or could become friable, urea formaldehyde foam insulation and
transformers or other equipment that contain dielectric fluid containing
polychlorinated biphenyls, (b) any chemicals or other materials or substances
which are now or hereafter become defined as or included in the definition of
"hazardous substances", "hazardous wastes", "hazardous materials", "extremely
hazardous wastes", "restricted hazardous wastes", "toxic substances", "toxic
pollutants", "contaminants", "pollutants" or words of similar import under any
Environmental Law and (c) any other chemical or other material or substance,
exposure to which is now or hereafter prohibited, limited or regulated under any
Environmental Law.
"Indebtedness" shall mean, for any Person: (a) obligations created,
issued or incurred by such Person for borrowed money (whether by loan, the
issuance and sale of debt securities or the sale of Property to another Person
subject to an understanding or agreement to repurchase such Property from such
Person); (b) obligations of such Person to pay the deferred purchase or
acquisition price of Property or services, other than trade accounts payable
(other than for borrowed money) arising, and accrued expenses incurred, in the
ordinary course of business (i) so long as such trade accounts payable are
payable within 270 days of the date the respective goods are delivered or the
respective services are rendered or (ii) with respect to trade accounts payable
which are payable beyond 270 days of
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the date the respective goods are delivered or the respective services are
rendered, to the extent that the aggregate amount outstanding of such trade
accounts payable at any one time does not exceed $50,000,000; (c) Indebtedness
of others secured by a Lien on the Property of such Person, whether or not the
respective Indebtedness so secured has been assumed by such Person; (d)
obligations (contingent or otherwise) of such Person in respect of letters of
credit, bankers' acceptances or similar instruments issued or accepted by banks
and other financial institutions for account of such Person; (e) Capital Lease
Obligations of such Person; and (f) Indebtedness of others Guaranteed by such
Person.
"Interest Coverage Ratio" shall mean, as at any date, the ratio of (a)
EBITDAR for the period of four consecutive fiscal quarters ending on or most
recently ended prior to such date to (b) the sum of Interest Expense for such
period plus Rental Payments for such period (to the extent not included in
Interest Expense) for such period.
"Interest Expense" shall mean, for any period, interest expense of the
Company and its Consolidated Subsidiaries (determined on a consolidated basis
without duplication in accordance with GAAP), excluding any interest income, any
write-off or amortization of deferred financing fees, but including in any event
the following: (a) all interest in respect of Indebtedness and all cash
dividends in respect of Preferred Stock accrued or capitalized during such
period (whether or not actually paid during such period) plus (b) the net
amounts payable (or minus the net amounts receivable) under Interest Rate
Protection Agreements accrued during such period (whether or not actually paid
or received during such period).
"Interest Period" shall mean, with respect to any Eurodollar Loan, each
period commencing on the date such Eurodollar Loan is made or Converted from a
Base Rate Loan or the last day of the next preceding Interest Period in the case
of a Continued Loan and ending on the numerically corresponding day in the
first, second, third or sixth calendar month thereafter, as the Company may
select as provided in Section 4.05 hereof, except that each Interest Period that
commences on the last Business Day of a calendar month (or on any day for which
there is no numerically corresponding day in the appropriate subsequent calendar
month) shall end on the last Business Day of the appropriate subsequent calendar
month. Notwithstanding the foregoing: (i) if any Interest Period for any Loan
would otherwise end after the Commitment Termination Date, such Interest Period
shall end on the Commitment Termination Date; (ii) each Interest Period that
would otherwise end on a day which is not a Business Day shall end on the next
succeeding Business Day (or, if such next succeeding Business Day falls in the
next succeeding calendar month, on the next preceding Business Day); and (iii)
notwithstanding clause (i) above, no Interest Period shall have a duration of
less than one month and, if the Interest Period for any Eurodollar Loan would
otherwise be a shorter period, such Loan shall not be available hereunder for
such period.
"Interest Rate Protection Agreement" shall mean, for any Person, a
swap, cap, collar or option agreement or similar arrangement between such Person
and one or more financial institutions providing for the transfer or mitigation
of interest rate or other risks either generally or under specific
contingencies."
"Investment" shall mean, for any Person: (a) the acquisition (whether
for cash, Property, services or securities or otherwise) of capital stock,
bonds, notes, debentures, partnership or other ownership interests or other
securities issued by any other Person or any agreement to make any such
acquisition (including, without limitation, any "short sale" or any sale of any
securities at a time when such securities are not owned by the Person entering
into such short sale); (b) the making of any deposit with, or advance, loan or
other extension of credit to, any other Person (including the purchase of
Property from another Person subject to an understanding or agreement,
contingent or otherwise, to resell such Property to such other Person, but
excluding any such advance, loan or extension of credit having a term not
exceeding 270 days representing the purchase price of inventory or supplies sold
by such Person in the ordinary course of business) and (without duplication) the
entering into of any commitment to deposit funds with, advance or lend funds to
or otherwise extend credit to such other Person (other than, in the case of the
Company or any Subsidiary of the Company, a Guarantee of Indebtedness or other
liabilities of any Subsidiary (other than an Unrestricted Subsidiary or a
Released Guarantor) of the Company); (c) the entering into of any Guarantee of,
or other contingent obligation with respect to, Indebtedness or other liability
of any other Person (other than, in the case of the Company or any Subsidiary of
the Company, a Guarantee of Indebtedness or other liabilities of any Subsidiary
(other than an Unrestricted Subsidiary or a Released Guarantor) of the Company);
or (d) the entering into of any Interest Rate Protection Agreement.
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"Investment Grade" shall mean that the Company's senior unsecured debt
obligations are rated Baa3 or higher by Moody's Investors Service, Inc. and BBB-
or higher by Standard & Poor's Corporation.
"Leverage Ratio" shall mean, at any time, the ratio of (a) Funded Debt
at such time to (b) EBITDA for the period of four consecutive fiscal quarters
ending on or most recently ended prior to such time.
"License Agreement" shall mean the License Agreement dated as of
February 11, 1987 between College and Barnes & Noble Discount Bookstores, Inc.
(a predecessor of B. Dalton), as the same shall be modified and supplemented and
in effect from time to time.
"Lien" shall mean, with respect to any Property, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
Property. For purposes of this Agreement and the other Basic Documents, a Person
shall be deemed to own subject to a Lien any Property that it has acquired or
holds subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement (other than an
operating lease) relating to such Property.
"LIFO Charge" shall mean a charge by the Company to its consolidated
earnings, before taxes, equal to the before-tax effect on the Company's
consolidated earnings as a result of using the last-in first-out accounting
method, instead of the first-in first-out accounting method, to calculate its
consolidated cost of goods sold, such charge to be determined in accordance with
GAAP.
"Loans" shall mean the loans provided for by Section 2.01(a) hereof,
which may be Base Rate Loans and/or Eurodollar Loans.
"Majority Lenders" shall mean, at all times, Lenders having at least
51% of the aggregate unpaid principal amount of the Loans (or, if no Loans shall
be outstanding, at least 51% of the aggregate amount of the Commitments).
"Margin Stock" shall mean "margin stock" within the meaning of
Regulations G, U and X.
"Material Adverse Effect" shall mean a material adverse effect on (a)
the Property, operations or financial condition of the Company and its
Subsidiaries taken as a whole, (b) the ability of any Obligor to perform its
obligations under any material provision of the Basic Documents to which it is a
party, (c) the validity or enforceability of any of the Basic Documents taken as
a whole, (d) the material rights and remedies of the Lenders and the
Administrative Agent under any of the Basic Documents or (e) the timely payment
of the principal of or interest on the Loans or other amounts payable in
connection therewith.
"Multiemployer Plan" shall mean a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been made by the Company or
any ERISA Affiliate and which is covered by Title IV of ERISA.
"Notes" shall mean the promissory notes provided for by Section 2.07(a)
hereof and all promissory notes delivered in substitution or exchange therefor,
in each case as the same shall be modified and supplemented and in effect from
time to time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Investments" shall mean: (a) direct obligations of the
United States of America or any agency thereof or obligations guaranteed by the
United States of America or any agency thereof, in each case, maturing within
360 days of the date of acquisition thereof, (b) investments in time deposit
accounts, certificates of deposit and money market deposits maturing within 180
days of the date of acquisition thereof issued by a bank or trust company which
is organized under the laws of the United States of America, any state thereof
or any foreign country recognized by the United States of America having
capital, surplus and undivided profits aggregating in excess of $300,000,000 and
whose debt is rated "A" (or such similar equivalent rating) or higher by at
least one
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<PAGE> 13
nationally recognized statistical rating organization (as defined in Rule 436
under the Securities Act of 1933, as amended) or any money-market fund sponsored
by any registered broker dealer or mutual fund distributor, (c) repurchase
obligations with a term of not more than 30 days for underlying securities of
the types described in clause (a) above entered into with a bank meeting the
qualifications described in clause (b) above, (d) investments in commercial
paper, maturing not more than 270 days after the date of acquisition, issued by
a corporation (other than an Affiliate or Subsidiary of the Company) organized
under the laws of the United States of America or any state thereof or any
foreign country recognized by the United States of America with a rating of
"P-1" (or higher) according to Moody's Investors Service, Inc. or "A-1" (or
higher) according to Standard and Poor's Corporation, (e) investments in
municipal securities with a rating of "A" (or such similar equivalent rating) or
higher by at least one nationally recognized statistical rating organization (as
defined in Rule 436 under the Securities Act of 1933, as amended), and (f) Dutch
auction-rate securities rated "AAA" (or such similar equivalent rating) or
higher by at least one nationally recognized statistical rating organization (as
defined in Rule 436 under the Securities Act of 1933, as amended).
"Permitted Management Ownership" shall mean no more than 30% of the
common stock of any Subsidiary of the Company created after the date hereof that
is owned by members of the management of such Subsidiary.
"Person" shall mean any individual, corporation, company, voluntary
association, partnership, joint venture, trust, unincorporated organization or
government (or any agency, instrumentality or political subdivision thereof).
"Plan" shall mean an employee benefit or other plan established or
maintained by the Company or any ERISA Affiliate and that is covered by Title IV
of ERISA, other than a Multiemployer Plan.
"Post-Default Rate" shall mean, in respect of any principal of any Loan
or any other amount under this Agreement, any Note or any other Basic Document
that is not paid when due (whether at stated maturity, by acceleration, by
optional or mandatory prepayment or otherwise), a rate per annum during the
period from and including the due date to but excluding the date on which such
amount is paid in full equal to 2% plus the Base Rate as in effect from time to
time plus the Applicable Margin for Base Rate Loans (provided that, if the
amount so in default is principal of a Eurodollar Loan and the due date thereof
is a day other than the last day of the Interest Period therefor, the
"Post-Default Rate" for such principal shall be, for the period from and
including such due date to but excluding the last day of the Interest Period, 2%
plus the interest rate for such Loan as provided in Section 3.02(ii) hereof and,
thereafter, the rate provided for above in this definition).
"Preferred Stock" shall mean preferred shares (including preferred
shares that are convertible into common shares of the Company) issued by the
Company from time to time that satisfies each of the following requirements: (i)
the aggregate net proceeds to the Company from the issuance of such preferred
shares shall not exceed $150,000,000; (ii) the preferred shares shall not
(without the consent of the Majority Lenders) in any event be redeemable (or
callable by the holder) prior to March 31, 2001; (iii) the preferred shares
shall constitute stockholders' equity within the meaning of GAAP; and (iv)
dividends shall not be payable in cash in respect of such shares at a rate per
annum in excess of the applicable interest rate on Base Rate Loans at the time
of the issuance of such shares.
"Prime Rate" shall mean the rate of interest from time to time
announced by Chase at its principal office in New York City as its prime
commercial lending rate.
"Principal Office" shall mean the principal office of Chase in New York
City.
"Prior Year Excess Cash Flow" shall mean, at any time, Excess Cash Flow
for the period of four consecutive fiscal quarters ending with the most recently
ended fiscal quarter.
"Project" shall have the meaning specified in the definition of
"Specified Capital Expenditures" in this Section 1.01.
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<PAGE> 14
"Property" shall mean any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Quarterly Dates" shall mean the last Business Day of each March, June,
September and December in each year, the first of which shall be the first such
day after the date of this Agreement.
"Reference Banks" shall mean Chase, Canadian Imperial Bank of Commerce
and The Bank of New York.
"Regulation A", "Regulation D", Regulation G", "Regulation U" and
"Regulation X" shall mean, respectively, Regulation A, Regulation D, Regulation
G, Regulation U and Regulation X of the Board of Governors of the Federal
Reserve System (or any successor), as the same may be modified and supplemented
and in effect from time to time.
"Regulatory Change" shall mean, with respect to any Lender, any change
after the date of this Agreement in Federal, state or foreign law or regulations
(including, without limitation, Regulation D) or the adoption or making after
such date of any interpretation, directive or request applying to a class of
banks including such Lender of or under any Federal, state or foreign law or
regulations (whether or not having the force of law and whether or not failure
to comply therewith would be unlawful) by any court or governmental or monetary
authority charged with the interpretation or administration thereof.
"Related Businesses" shall have the meaning specified in Section
9.05(d)(iv) of this Agreement.
"Release" shall mean any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration of
Hazardous Materials into the indoor or outdoor environment, including, without
limitation, the movement of Hazardous Materials through ambient air, soil,
surface water, ground water, wetlands, land or subsurface strata.
"Released Guarantors" shall mean Subsidiary Guarantors that have been
released, pursuant to Section 6.09 hereof, from their guarantee obligations
under Section 6 hereof.
"Rental Payments" shall mean, for any period, for the Company and its
Consolidated Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), all rental payments (including minimum and
percentage rent payments) made or accrued during such period in respect of any
operating lease or similar arrangement for the use of Property by the Company or
any Consolidated Subsidiary (net of any sublease rental income), but excluding
payments in respect of common area maintenance, merchants' association dues,
advertisements required pursuant to such lease or similar arrangement and
allocations for real estate tax assessments.
"Riggio" shall mean Mr. Leonard Riggio.
"Sale Lease-back" shall have the meaning specified in the definition of
"Specified Capital Expenditures" in this Section 1.01.
"Sale Lease-back Proceeds" shall mean the proceeds from the sale by the
Company or one of its Subsidiaries (other than an Unrestricted Subsidiary or a
Released Guarantor) of a Project to a lessor in a Sale Lease-back.
"Significant Subsidiary" shall mean, with respect to the Company, (a)
each Subsidiary that is a "Significant Subsidiary" of the Company within the
meaning of Rule 1-02 of Regulation S-X of the Securities and Exchange
Commission, and (b) each Subsidiary (other than any Unrestricted Subsidiary or
Released Guarantor) the principal business of which is a retail bookstore
business.
"Specified Capital Expenditures" shall mean expenditures made by the
Company or its Subsidiaries to acquire and develop real property by building
retail bookstores thereon (each such development, a "Project") with a view to
transferring title to such developed real property to another Person (other than
an Affiliate or Subsidiary of the Company) within 24 months after the
acquisition of such real property and concurrently leasing it back from
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<PAGE> 15
such Person (a "Sale Lease-back"), provided that if any Project has not been
made the subject of a Sale Lease-back within 24 months after the first such
expenditures are made with respect to such Project, all of such expenditures
made with respect to such Project shall constitute Capital Expenditures (and be
deemed to have been made at the later of the end of such 24-month period and the
time actually made) for all purposes of this Agreement (and shall not constitute
Specified Capital Expenditures) and shall be:
(a) subject to the limitations in Section 9.11(a) hereof, and
(b) included in Capital Expenditures for purposes of clause
(a) of the definition of "Excess Cash Flow" in Section 1.01 hereof,
in all cases until such time (if any) as such Project is made the subject of a
Sale Lease-back (at which time such expenditures shall again constitute
Specified Capital Expenditures).
"Subordinated Debt" shall mean Indebtedness of the Obligors in an
aggregate principal amount not to exceed $300,000,000,
(a) which has no scheduled amortization on or prior to the
Commitment Termination Date;
(b) which is subordinated to the prior payment in full in cash
of the obligations of the Obligors hereunder and under the other Basic
Documents such that (i) no payments in respect of any such Indebtedness
(whether principal, interest or otherwise, but excluding certain
subordinated securities received in connection with a bankruptcy
reorganization of an Obligor and excluding payments made from a
sinking, defeasance or similar fund) may be made while any amount under
the Credit Agreement or any other Basic Document is due and unpaid, and
(ii) no payments (excluding certain subordinated securities received in
connection with a bankruptcy reorganization of an Obligor and excluding
payments made from a sinking, defeasance or similar fund) in respect of
any such Indebtedness may be made during any 179-day period commencing
on notice being given to the trustee for the holders of such
Indebtedness of the occurrence of any Event of Default (other than a
payment default described in the foregoing clause (c)(i)), subject to
then-customary limitations on the number of such periods;
(c) the terms and conditions of which will not restrict any of
the Obligors from creating any Liens upon any of their respective
Properties, whether now owned or hereafter acquired, securing the
obligations of the Obligors under this Agreement and the other Basic
Documents;
(d) the terms and conditions of which do not contain any
provision permitting the maturity of such Indebtedness to be
accelerated upon the occurrence of a Default hereunder or Event of
Default hereunder (but which may contain a provision permitting
acceleration of such Indebtedness upon the acceleration of the Loans
hereunder);
(e) the terms and conditions of which contain covenants which
are no more restrictive to the Obligors than the covenants in this
Agreement; and
(f) the other covenants and events of default of which (when
taken as a whole) substantially reflect then-current market terms and
conditions for similar issues of subordinated Indebtedness.
"Subsidiary" shall mean, with respect to any Person, any corporation,
partnership or other entity of which at least a majority of the securities or
other ownership interests having by the terms thereof ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions of such corporation, partnership or other entity (irrespective of
whether or not at the time securities or other ownership interests of any other
class or classes of such corporation, partnership or other entity shall have or
might have voting power by reason of the happening of any contingency) is at the
time directly or indirectly owned or controlled by such Person or one or more
Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person.
"Type" shall have the meaning assigned to such term in Section 1.03
hereof.
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<PAGE> 16
"Unrelated Persons" shall mean any Person other than (a) Riggio, his
wife, his siblings, his children or any trust established for the benefit of
Riggio, his wife, his siblings or his children and (b) any Person directly or
indirectly effectively controlled (whether through legal or beneficial ownership
of equity interests in such Person, by contract or otherwise) by, or by any
estate of, any of the Persons referred to in clause (a).
"Unrestricted Subsidiary" shall mean a Subsidiary acquired or
established by the Company or any Subsidiary of the Company pursuant to Section
9.05(d)(iv) hereof and designated as an "Unrestricted Subsidiary" by a notice
from the Company to the Lenders no later than three Business Days prior to the
effective date for such designation.
"U.S. Person" shall have the meaning given to that term in Section
5.07(a) hereof.
"Voting Shares" shall mean shares of capital stock of the Company, of
any class or classes (however designated) (a) having by the terms thereof voting
power to elect the members of the board of directors of the Company or (b)
convertible into shares of capital stock of the Company of the type described in
the foregoing clause (a).
"Wholly Owned Subsidiary" shall mean, with respect to any Person, any
corporation, partnership or other entity of which all of the equity securities
or other ownership interests (other than, in the case of a corporation,
directors' qualifying shares) are owned or controlled by such Person or one or
more Wholly Owned Subsidiaries of such Person.
1.02 Accounting Terms and Determinations.
(a) Except as otherwise expressly provided herein, (i) all accounting
terms used herein shall be interpreted, (ii) all financial statements and all
certificates and reports as to financial matters required to be delivered to the
Lenders hereunder shall (unless otherwise disclosed to the Lenders in writing at
the time of delivery thereof in the manner described in subsection (b) below) be
prepared and (iii) all calculations made for the purposes of determining
compliance with this Agreement shall (except as otherwise expressly provided
herein) be made in accordance with or by application of generally accepted
accounting principles applied on a basis consistent with those used in the
preparation of the most recent financial statements furnished to the Lenders
hereunder (or, prior to the delivery of the first financial statements under
Section 9.01 hereof, the audited financial statements as of January 29, 2000,
referred to in Section 8.02 hereof) unless (x) the Company shall notify the
Lenders of its objection thereto at the time of delivery of any financial
statements pursuant to Section 9.01 hereof or (y) the Majority Lenders shall
notify the Company (through the Administrative Agent) of their objection within
30 days after the delivery of any such financial statements, in either of which
events such interpretations, statements, certificates, reports and calculations
shall be made in accordance with, or by application of, generally accepted
accounting principles on a basis consistent with those used in the preparation
of the most recent financial statements as to which no such objection shall have
been made (or, prior to the delivery of the first financial statements under
Section 9.01 hereof, the audited financial statements as at January 29, 2000,
referred to in Section 8.02 hereof).
(b) The Company shall deliver to the Lenders at the same time as the
delivery of any annual or quarterly financial statement under Section 9.01
hereof (i) a description in reasonable detail of any material variation between
the application of accounting principles employed in the preparation of such
statement and the application of accounting principles employed in the
preparation of the next preceding annual or quarterly financial statements as to
which no objection has been made in accordance with the last sentence of
paragraph (a) above and (ii) reasonable estimates of the difference between such
statements arising as a consequence thereof.
(c) The Company will not, and will not permit any of its Subsidiaries
(other than an Unrestricted Subsidiary or a Released Guarantor) to, change the
last day of its fiscal year from the Saturday falling on or nearest to January
31 of each year, or the last days of the first three fiscal quarters in each of
its fiscal years from the Saturday falling on or nearest to the last day of
April, July and October of each year, respectively.
1.03 Types. The "Type" of a Loan refers to whether such Loan is a Base
Rate Loan or a Eurodollar Loan, each of which constitutes a Type of Loan.
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Section 2. Commitments, Loans, Notes and Prepayments.
2.01 Loans.
(a) Loans. Each Lender severally agrees, on the terms and conditions of
this Agreement, to make loans to the Company in Dollars during the period from
and including the later of (x) October 1, 2000 and (y) the Closing Date to but
not including the Commitment Termination Date in an aggregate principal amount
at any one time outstanding up to but not exceeding the amount of the Commitment
of such Lender as in effect from time to time. Subject to the terms and
conditions of this Agreement, during such period the Company may borrow, repay
and reborrow the amount of the Commitments by means of Base Rate Loans and
Eurodollar Loans and may Convert Loans of one Type into Loans of the other Type
(as provided in Section 2.08 hereof) or Continue Loans that are Eurodollar Loans
(as provided in Section 2.08 hereof).
(b) Limit on Eurodollar Loans. No more than five separate Interest
Periods in respect of Eurodollar Loans from each Lender may be outstanding at
any one time.
2.02 Borrowings of Loans. The Company shall give the Administrative
Agent (which shall promptly notify the Lenders) notice of each borrowing of
Loans hereunder as provided in Section 4.05 hereof. Not later than 2:00 p.m. New
York time on the date specified for each borrowing of Loans hereunder, each
Lender shall make available the amount of the Loan or Loans to be made by it on
such date to the Administrative Agent at the Principal Office, in Dollars and
immediately available funds, for account of the Company. The amount so received
by the Administrative Agent shall, subject to the terms and conditions of this
Agreement, be made available by the Administrative Agent to the Company by
depositing the same, in immediately available funds, in an account of the
Company maintained with Chase at the Principal Office designated by the Company.
2.03 Changes of Commitments.
(a) The aggregate amount of the Commitments shall be automatically
reduced to zero on the Commitment Termination Date.
(b) The Company shall have the right at any time or from time to time
(i) so long as no Loans are outstanding hereunder, to terminate the Commitments
in full and (ii) to reduce the aggregate unused amount of the Commitments;
provided that (x) the Company shall give notice of each such termination or
reduction as provided in Section 4.05 hereof and (y) each partial reduction
shall be in an aggregate amount equal to $5,000,000 or any integral multiple of
$5,000,000 in excess thereof.
(c) The Commitments once terminated or reduced may not be reinstated.
2.04 Commitment Fees. The Company shall pay to the Administrative Agent
for account of each Lender a commitment fee on the daily average unused amount
of the Commitment of such Lender, for the period from and including the date
hereof to but not including the earlier of the date the Commitments are
terminated and the Commitment Termination Date, at a rate per annum equal to 3/8
of 1%. Accrued commitment fees payable to the Lenders in respect of the
Commitments shall be payable on each Quarterly Date and on the earlier of the
date the Commitments are terminated in full and the Commitment Termination Date.
2.05 Lending Offices. The Loans of each Type made by each Lender shall
be made and maintained at such Lender's Applicable Lending Office for Loans of
such Type.
2.06 Several Obligations; Remedies Independent. The failure of any
Lender (a "Defaulting Lender") to make any Loan to be made by it on the date
specified therefor shall not relieve any other Lender of its obligation to make
any Loan to be made by it on such date, but neither any Lender nor the
Administrative Agent shall be responsible for the failure of any Defaulting
Lender to make a Loan to be made by such Defaulting Lender, and no Lender shall
have any obligation to the Administrative Agent or any other Lender for the
failure by such Defaulting Lender to make any Loan required to be made by such
Defaulting Lender. The amounts payable by the Company at any time hereunder and
under the Notes to each Lender shall be a separate and independent debt and each
Lender
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<PAGE> 18
shall be entitled to protect and enforce its rights arising out of this
Agreement and the Notes, and it shall not be necessary for any other Lender or
the Administrative Agent to consent to, or be joined as an additional party in,
any proceedings for such purposes.
2.07 Notes.
(a) The Loans made by each Lender shall be evidenced by a single
promissory note of the Company substantially in the form of Exhibit A hereto,
dated the date hereof, payable to the order of such Lender in a principal amount
equal to the amount of its Commitment as originally in effect and otherwise duly
completed.
(b) The date, amount, Type, interest rate and duration of Interest
Period (if applicable) of each Loan made by each Lender to the Company, and each
payment made on account of the principal thereof, shall be recorded by such
Lender on its books and, prior to any transfer of the Note evidencing Loans held
by it, endorsed by such Lender on the schedule attached to such Note or any
continuation thereof; provided that the failure of such Lender to make any such
recordation or endorsement shall not affect the obligations of the Company to
make a payment when due of any amount owing hereunder or under such Note in
respect of the Loans.
(c) No Lender shall be entitled to have its Notes subdivided by
exchange for promissory notes of lesser denominations or otherwise, except in
connection with a permitted assignment of all or any portion of such Lender's
Commitment, Loans and Note pursuant to Section 12.06(b) hereof.
2.08 Optional Prepayments and Conversions or Continuations of Loans.
Subject to Section 4.04 hereof, the Company shall have the right to prepay
Loans, or to Convert Loans of one Type into Loans of the other Type or Continue
Loans of one Type as Loans of the same Type, at any time or from time to time,
provided that the Company shall give the Administrative Agent notice of each
such prepayment, Conversion or Continuation as provided in Section 4.05 hereof
(and, upon the prepayment date specified in any such notice of prepayment, the
amount to be prepaid shall become due and payable hereunder). Notwithstanding
the foregoing, and without limiting the rights and remedies of the Lenders under
Section 10 hereof, in the event that any Event of Default shall have occurred
and be continuing, the Administrative Agent may (and at the request of the
Majority Lenders shall) suspend the right of the Company to borrow any Loan as a
Eurodollar Loan, to Convert any Loan into a Eurodollar Loan or to Continue any
Loan as a Eurodollar Loan, in which event all Eurodollar Loans then outstanding
shall be Converted (on the last day(s) of the respective Interest Periods
therefor) into Base Rate Loans.
Section 3. Payments of Principal and Interest.
3.01 Repayment of Loans. The Company hereby promises to pay to the
Administrative Agent for account of each Lender the entire outstanding principal
amount of such Lender's Loans, and each Loan shall mature, on the Commitment
Termination Date.
3.02 Interest. The Company hereby promises to pay to the Administrative
Agent for account of each Lender interest on the unpaid principal amount of each
Loan made by such Lender for the period from and including the date of such Loan
to but excluding the date such Loan shall be paid in full, at the following
rates per annum:
(i) during such periods as such Loan is a Base Rate Loan, the
Base Rate (as in effect from time to time) plus the Applicable Margin;
and
(ii) during such periods as such Loan is a Eurodollar Loan,
for each Interest Period relating thereto, the Eurodollar Rate for such
Loan for such Interest Period plus the Applicable Margin.
Notwithstanding the foregoing, the Company hereby promises to pay to the
Administrative Agent for account of each Lender interest at the applicable
Post-Default Rate on any principal of any Loan made by such Lender and on any
other amount payable by the Company hereunder or under the Note held by such
Lender to or for account of such Lender, which shall not be paid in full when
due (whether at stated maturity, by acceleration, by mandatory
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<PAGE> 19
prepayment or otherwise), for the period from and including the due date thereof
to but excluding the date the same is paid in full. Accrued interest on each
Loan shall be payable (i) in the case of a Base Rate Loan, quarterly on the
Quarterly Dates, (ii) in the case of a Eurodollar Loan, on the last day of each
Interest Period therefor and, if such Interest Period is longer than three
months, at three-month intervals following the first day of such Interest
Period, and (iii) in the case of any Loan, upon the payment or prepayment
thereof or the Conversion of such Loan to a Loan of another Type (but only on
the principal amount so paid, prepaid or Converted), except that interest
payable at the Post-Default Rate shall be payable from time to time on demand of
the Lenders for whose account such interest is payable. Promptly after the
determination of any interest rate provided for herein or any change therein,
the Administrative Agent shall give notice thereof to the Lenders to which such
interest is payable and to the Company.
Section 4. Payments; Pro Rata Treatment; Computations; Etc.
4.01 Payments.
(a) Except to the extent otherwise provided herein, all payments of
principal, interest and other amounts to be made by the Company under this
Agreement and the Notes, and, except to the extent otherwise provided therein,
all payments to be made by the Obligors under any other Basic Document, shall be
made in Dollars, in immediately available funds, without deduction, set-off or
counterclaim, to the Administrative Agent at the Principal Office, not later
than 1:30 p.m. New York time on the date on which such payment shall become due
(each such payment made after such time on such due date to be deemed to have
been made on the next succeeding Business Day).
(b) Any Lender for whose account any such payment is to be made may
(but shall not be obligated to) debit the amount of any such payment that is not
made by such time to any ordinary deposit account of the Company with such
Lender (with notice to the Company and the Administrative Agent) and any such
debit shall be deemed to be a payment by the Company.
(c) The Company shall, at the time of making each payment under this
Agreement or any Note for account of any Lender, specify to the Administrative
Agent (which shall notify the intended recipient(s) thereof) the Loans or other
amounts payable by the Company hereunder to which such payment is to be applied,
in which case such payment shall be, subject to Section 4.02 hereof, so applied
(and in the event that the Company fails to so specify, or if an Event of
Default has occurred and is continuing, such payment shall be, subject to said
Section 4.02, applied in such manner as is determined to be appropriate by the
Majority Lenders or, if the Majority Lenders fail to advise the Administrative
Agent of their determination promptly following a request from the
Administrative Agent for such a determination, by the Administrative Agent).
(d) Each payment received by the Administrative Agent under this
Agreement or any Note for account of any Lender shall be paid by the
Administrative Agent promptly to such Lender, in immediately available funds,
for account of the Applicable Lending Office of such Lender for the Loan or
other obligation in respect of which such payment is made.
(e) If the due date of any payment under this Agreement or any Note
would otherwise fall on a day that is not a Business Day, such date shall be
extended to the next succeeding Business Day, and interest shall be payable on
any principal so extended for the period of such extension.
4.02 Pro Rata Treatment. Except to the extent otherwise provided
herein:
(a) each borrowing of Loans under Section 2.01 hereof shall be
made from the Lenders, each payment of commitment fee under Section
2.04 hereof shall be made for account of the Lenders and each
termination or reduction of the Commitments under Section 2.03 hereof
shall be applied to the respective Commitments of the Lenders, pro rata
according to the amounts of their respective Commitments;
(b) the making, Conversion and Continuation of Loans of a
particular Type (other than Conversions provided for by Section 5.04
hereof) shall be made pro rata among the Lenders according to
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<PAGE> 20
the amounts of their respective Commitments (in the case of making of
Loans) or their respective Loans (in the case of Conversions and
Continuations of Loans), and Eurodollar Loans having the same Interest
Period shall be allocated pro rata among the Lenders according to the
amounts of their respective Loans of such Type;
(c) each payment or prepayment of principal of Loans shall be
made for account of the Lenders pro rata in accordance with the
respective unpaid principal amounts of Loans held by the Lenders; and
(d) each payment of interest on Loans shall be made for
account of the Lenders pro rata in accordance with the amounts of
interest on Loans then due and payable to the respective Lenders.
4.03 Computations. Interest on Eurodollar Loans shall be computed on
the basis of a year of 360 days and actual days elapsed (including the first day
but excluding the last day) occurring in the period for which payable, and
interest on Base Rate Loans and commitment fees shall be computed on the basis
of a year of 365 or 366 days, as the case may be, and actual days elapsed
(including the first day but excluding the last day) occurring in the period for
which payable.
4.04 Minimum Amounts. Except for Conversions or prepayments made
pursuant to Section 5.04 hereof, each borrowing, Conversion and partial
prepayment of principal of Loans shall be in an aggregate amount equal to
$5,000,000 or any integral multiple of $1,000,000 in excess thereof (borrowings,
Conversions or prepayments of or into Loans of different Types or, in the case
of Eurodollar Loans, having different Interest Periods at the same time
hereunder to be deemed separate borrowings, Conversions and prepayments for
purposes of the foregoing, one for each Type or Interest Period). Anything in
this Agreement to the contrary notwithstanding, the aggregate principal amount
of Eurodollar Loans having the same Interest Period shall be in an amount at
least equal to $5,000,000 and, if any Eurodollar Loans having the same Interest
Period would otherwise be in a lesser principal amount for any period, such
Loans shall be Base Rate Loans during such period.
4.05 Certain Notices. Notices by the Company to the Administrative
Agent of terminations or reductions of Commitments and of borrowings,
Conversions, Continuations and optional prepayments of Loans, of Types of Loans
and of the duration of Interest Periods shall be irrevocable and shall be
effective only if received by the Administrative Agent not later than 1:00 p.m.
(or 3:00 p.m. in the case of a borrowing or prepayment of, Conversions into,
Continuations as, or the duration of an Interest Period for, Eurodollar Loans)
New York time on the number of Business Days prior to the date of the relevant
termination, reduction, borrowing, Conversion, Continuation or optional
prepayment or the first day of such Interest Period specified below:
<TABLE>
<CAPTION>
Number of
Business
Notice Days Prior
<S> <C>
Termination or reduction
of Commitments Three
Borrowing or prepayment of,
or Conversions into,
Base Rate Loans Same Day
Borrowing or prepayment of,
Conversions into, Continuations
as, or duration of Interest
Period for, Eurodollar Loans Three
</TABLE>
Each such notice of termination or reduction shall specify the amount of the
Commitments to be terminated or reduced. Each such notice of borrowing,
Conversion, Continuation or optional prepayment shall specify the Type of each
Loan to be borrowed, Converted, Continued or prepaid, the date of borrowing,
Conversion, Continuation or optional prepayment (which shall be a Business Day),
and, if any such Loan is to be borrowed or Continued as, or
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<PAGE> 21
Converted into, a Eurodollar Loan, the duration of the Interest Period for such
Loan. The Administrative Agent shall promptly notify the Lenders of the contents
of each such notice. In the event that the Company fails to select the Type of
Loan, or the duration of any Interest Period for any Eurodollar Loan, within the
time period and otherwise as provided in this Section 4.05, such Loan (if
outstanding as a Eurodollar Loan) will be automatically Converted into a Base
Rate Loan on the last day of the then current Interest Period for such Loan or
(if outstanding as a Base Rate Loan) will remain as, or (if not then
outstanding) will be made as, a Base Rate Loan.
4.06 Non-Receipt of Funds by the Administrative Agent. Unless the
Administrative Agent shall have been notified by a Lender or the Company (the
"Payor") prior to the date on which the Payor is to make payment to the
Administrative Agent of (in the case of a Lender) the proceeds of a Loan to be
made by such Lender hereunder or (in the case of the Company) a payment to the
Administrative Agent for account of one or more of the Lenders hereunder (such
payment being herein called the "Required Payment"), which notice shall be
effective upon receipt, that the Payor does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that
the Required Payment has been made and may, in reliance upon such assumption
(but shall not be required to), make the amount thereof available to the
intended recipient(s) on such date; and, if the Payor has not in fact made the
Required Payment to the Administrative Agent, the recipient(s) of such payment
shall, on demand, repay to the Administrative Agent the amount so made available
together with interest thereon in respect of each day during the period
commencing on the date (the "Advance Date") such amount was so made available by
the Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to the Federal Funds Rate for such day and, if
such recipient(s) shall fail promptly to make such payment, the Administrative
Agent shall be entitled to recover such amount, on demand, from the Payor,
together with interest as aforesaid, provided that if the recipient(s) shall
fail to return, and the Payor shall fail to make, the Required Payment to the
Administrative Agent within three Business Days of the Advance Date, then the
Payor and the recipient(s) shall each be obligated to pay interest on the
Required Payment as follows:
(a) if the Required Payment shall represent a payment to be
made by the Company to the Lenders, the Company and the recipient(s)
shall each be obligated retroactively to the Advance Date to pay
interest in respect of the Required Payment at the Post-Default Rate
(and, in case the recipient(s) shall return the Required Payment to the
Administrative Agent, without limiting the obligation of the Company
under Section 3.02 hereof to pay interest to such recipient(s) at the
Post-Default Rate in respect of the Required Payment); and
(b) if the Required Payment shall represent proceeds of a Loan
to be made by the Lenders to the Company, the Payor and the Company
shall each be obligated retroactively to the Advance Date to pay
interest in respect of the Required Payment at the rate of interest
provided for such Required Payment pursuant to Section 3.02 hereof
(and, in case the Company shall return the Required Payment to the
Administrative Agent, without limiting any claim the Company may have
against the Payor in respect of the Required Payment).
Nothing in this Section 4.06 shall require the Company to pay any greater amount
in respect of principal of any Loan, interest on any Loan than it would be
required to pay hereunder in the absence of this Section 4.06.
4.07 Sharing of Payments, Etc.
(a) The Company agrees that, in addition to (and without limitation of)
any right of set-off, banker's lien or counterclaim a Lender may otherwise have,
each Lender shall be entitled, at its option, to offset balances held by it for
account of the Company at any of its offices, in Dollars or in any other
currency, against any principal of or interest on any of such Lender's Loans or
any other amount payable to such Lender (as the case may be) hereunder, that is
not paid when due (regardless of whether such balances are then due to the
Company), in which case it shall promptly thereafter notify the Company and the
Administrative Agent thereof, provided that such Lender's failure to give such
notice shall not affect the validity thereof.
(b) If any Lender shall obtain from any Obligor payment of any
principal of or interest on any Loan owing to it or payment of any other amount
under this Agreement or any other Basic Document through the exercise of any
right of set-off, banker's lien or counterclaim or similar right or otherwise
(other than from the Administrative Agent as provided herein), and, as a result
of such payment, such Lender shall have received a greater percentage of the
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<PAGE> 22
principal of or interest on the Loans or such other amounts then due hereunder
or thereunder by such Obligor to such Lender than the percentage received by any
other Lender, it shall promptly purchase from such other Lenders participations
in (or, if and to the extent specified by such Lender, direct interests in) the
Loans or such other amounts, respectively, owing to such other Lenders (or in
interest due thereon, as the case may be) in such amounts, and make such other
adjustments from time to time as shall be equitable, to the end that all the
Lenders shall share the benefit of such excess payment (net of any expenses that
may be incurred by such Lender in obtaining or preserving such excess payment)
pro rata in accordance with the unpaid principal of and/or interest on the Loans
or such other amounts, respectively, owing to each of the Lenders. To such end
all the Lenders shall make appropriate adjustments among themselves (by the
resale of participations sold or otherwise) if such payment is rescinded or must
otherwise be restored.
(c) The Company agrees that any Lender so purchasing such a
participation (or direct interest) pursuant to the foregoing clause (b) may
exercise all rights of set-off, banker's lien, counterclaim or similar rights
with respect to such participation as fully as if such Lender were a direct
holder of Loans or other amounts (as the case may be) owing to such Lender in
the amount of such participation.
(d) Nothing contained herein shall require any Lender to exercise any
such right or shall affect the right of any Lender to exercise, and retain the
benefits of exercising, any such right with respect to any other indebtedness or
obligation of any Obligor. If, under any applicable bankruptcy, insolvency or
other similar law, any Lender receives a secured claim in lieu of a set-off to
which this Section 4.07 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent with
the rights of the Lenders entitled under this Section 4.07 to share in the
benefits of any recovery on such secured claim.
Section 5. Yield Protection, Etc.
5.01 Additional Costs.
(a) The Company shall pay directly to each Lender from time to time
such amounts as such Lender may reasonably and in good faith determine to be
necessary to compensate such Lender for any increased costs that such Lender
reasonably and in good faith determines are attributable to its making or
maintaining of any Eurodollar Loans or its obligation to make any Eurodollar
Loans hereunder, or any reduction in any amount receivable by such Lender
hereunder in respect of any of such Loans or such obligation (such increases in
costs and reductions in amounts receivable being herein called "Additional
Costs"), resulting from any Regulatory Change that:
(i) changes the basis of taxation of any amounts payable to
such Lender under this Agreement or its Note in respect of any of such
Loans (other than taxes imposed on or measured by the overall net
income of such Lender or of its Applicable Lending Office for any of
such Loans by the jurisdiction in which such Lender has its principal
office or such Applicable Lending Office); or
(ii) imposes or modifies any reserve, special deposit or
similar requirements (other than, in the case of any Lender for any
period as to which the Company is required to pay any amount under
paragraph (e) below, the reserves against "Eurocurrency liabilities"
under Regulation D therein referred to) relating to any extensions of
credit or other assets of, or any deposits with or other liabilities
of, such Lender (including, without limitation, any of such Loans or
any deposits referred to in the definition of "Eurodollar Rate" in
Section 1.01 hereof), or any commitment of such Lender hereunder
(including, without limitation, the Commitments of such Lender); or
(iii) imposes any other condition affecting this Agreement or
its Note (or any of such extensions of credit or liabilities) or its
Commitments.
If any Lender requests compensation from the Company under this Section 5.01(a),
the Company may, by notice to such Lender (with a copy to the Administrative
Agent), suspend the obligation of such Lender thereafter to make or Continue
Eurodollar Loans, or to Convert Base Rate Loans into Eurodollar Loans, until the
Regulatory Change
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<PAGE> 23
giving rise to such request ceases to be in effect (in which case the provisions
of Section 5.04 hereof shall be applicable), provided that such suspension shall
not affect the right of such Lender to receive the compensation so requested to
the extent such Lender certifies that such compensation is still payable
notwithstanding such suspension.
(b) Without limiting the effect of the provisions of paragraph (a) of
this Section 5.01, in the event that, by reason of any Regulatory Change, any
Lender either (i) incurs Additional Costs based on or measured by the excess
above a specified level of the amount of a category of deposits or other
liabilities of such Lender that includes deposits by reference to which the
interest rate on Eurodollar Loans is determined as provided in this Agreement or
a category of extensions of credit or other assets of such Lender that includes
Eurodollar Loans or (ii) becomes subject to restrictions on the amount of such a
category of liabilities or assets that it may hold, then, if such Lender so
elects by notice to the Company (with a copy to the Administrative Agent), the
obligation of such Lender to make or Continue, or to Convert Base Rate Loans
into, Eurodollar Loans hereunder shall be suspended until such Regulatory Change
ceases to be in effect (in which case the provisions of Section 5.04 hereof
shall be applicable) and the Company shall not be obligated to pay any
Additional Costs for which the Lender ceases to be liable or to incur.
(c) Without limiting the effect of the foregoing provisions of this
Section 5.01 (but without duplication), the Company shall pay directly to each
Lender from time to time on request such amounts as such Lender may determine
reasonably and in good faith to be necessary to compensate such Lender (or,
without duplication, the bank holding company of which such Lender is a
subsidiary) for any costs that it determines reasonably and in good faith are
attributable to the maintenance by such Lender (or any Applicable Lending Office
or such bank holding company), pursuant to any law or regulation or any
interpretation, directive or request (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful) of any court or
governmental or monetary authority
(i) following any Regulatory Change, or
(ii) implementing any risk-based capital guideline or other
requirement (whether or not having the force of law and whether or not
the failure to comply therewith would be unlawful) heretofore or
hereafter issued by any government or governmental or supervisory
authority implementing at the national level the Basel Accord
(including, without limitation, the Final Risk-Based Capital Guidelines
of the Board of Governors of the Federal Reserve System (12 C.F.R. Part
208, Appendix A; 12 C.F.R. Part 225, Appendix A) and the Final
Risk-Based Capital Guidelines of the Office of the Comptroller of the
Currency (12 C.F.R. Part 3, Appendix A)),
of capital in respect of its Commitments or Loans (such compensation to include,
without limitation, an amount equal to any reduction of the rate of return on
assets or equity of such Lender (or any Applicable Lending Office or such bank
holding company) to a level below that which such Lender (or any Applicable
Lending Office or such bank holding company) could have achieved but for such
law, regulation, interpretation, directive or request). For purposes of this
Section 5.01(c), "Basel Accord" shall mean the proposals for risk-based capital
framework described by the Basel Committee on Banking Regulations and
Supervisory Practices in its paper entitled "International Convergence of
Capital Measurement and Capital Standards" dated July 1988, as amended, modified
and supplemented and in effect from time to time or any replacement thereof.
(d) Each Lender shall notify the Company and the Administrative Agent
of any event occurring after the date of this Agreement entitling such Lender to
compensation under paragraph (a) or (c) of this Section 5.01 as promptly as
practicable, but in any event within 30 days, after such Lender obtains actual
knowledge thereof; provided that (i) if any Lender fails to give such notice
within 30 days after it obtains actual knowledge of such an event, such Lender
shall, with respect to compensation payable pursuant to this Section 5.01 in
respect of any costs resulting from such event, only be entitled to payment
under this Section 5.01 for costs incurred from and after the date 30 days prior
to the date that such Lender does give such notice and (ii) each Lender will
designate a different Applicable Lending Office for the Loans of such Lender
affected by such event if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the reasonable opinion of such
Lender, be disadvantageous to such Lender, except that such Lender shall have no
obligation to designate an Applicable Lending Office located in the United
States of America. Each Lender will furnish to the Company a certificate
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<PAGE> 24
setting forth the basis and amount of each request by such Lender for
compensation under paragraph (a) or (c) of this Section 5.01. Determinations and
allocations by any Lender for purposes of this Section 5.01 of the effect of any
Regulatory Change pursuant to paragraph (a) or (b) of this Section 5.01, or of
the effect of capital maintained pursuant to paragraph (c) of this Section 5.01,
on its costs or rate of return of maintaining Loans or its obligation to make
Loans, or on amounts receivable by it in respect of Loans, and of the amounts
required to compensate such Lender under this Section 5.01, shall be conclusive,
provided that such determinations and allocations are made on a reasonable basis
and absent demonstrable error.
(e) Without limiting the effect of the foregoing, the Company shall pay
to each Lender on the last day of each Interest Period so long as such Lender is
maintaining reserves against "Eurocurrency liabilities" under Regulation D (or,
unless the provisions of paragraph (b) above are applicable, so long as such
Lender is, by reason of any Regulatory Change, maintaining reserves against any
other category of liabilities which includes deposits by reference to which the
interest rate on Eurodollar Loans is determined as provided in this Agreement or
against any category of extensions of credit or other assets of such Lender
which includes any Eurodollar Loans) an additional amount (determined by such
Lender and notified to the Company through the Administrative Agent) equal to
the product of the following for each Eurodollar Loan for each day during such
Interest Period:
(i) the principal amount of such Eurodollar Loan outstanding
on such day; and
(ii) the remainder of (x) a fraction the numerator of which is
the rate (expressed as a decimal) at which interest accrues on such
Eurodollar Loan for such Interest Period as provided in this Agreement
(less the Applicable Margin) and the denominator of which is one minus
the effective rate (expressed as a decimal) at which such reserve
requirements are imposed on such Lender on such day minus (y) such
numerator; and
(iii) 1/360.
5.02 Limitation on Types of Loans. Anything herein to the contrary
notwithstanding, if, on or prior to the determination of any Eurodollar Rate for
any Interest Period:
(a) the Administrative Agent determines reasonably and in good
faith, which determination shall be conclusive, that quotations of
interest rates for the relevant deposits referred to in the definition
of "Eurodollar Rate" in Section 1.01 hereof are not being provided in
the relevant amounts or for the relevant maturities for purposes of
determining rates of interest for Eurodollar Loans as provided herein;
or
(b) the Majority Lenders determine reasonably and in good
faith, which determination shall be conclusive, and notify the
Administrative Agent that the relevant rates of interest referred to in
the definition of "Eurodollar Rate" in Section 1.01 hereof upon the
basis of which the rate of interest for Eurodollar Loans for such
Interest Period is to be determined are not likely to adequately cover
the cost to such Lenders of making or maintaining Eurodollar Loans for
such Interest Period;
then the Administrative Agent shall give the Company and each Lender prompt
notice thereof and, so long as such condition remains in effect, the Lenders
shall be under no obligation to make additional Eurodollar Loans, to Continue
Eurodollar Loans or to Convert Base Rate Loans into Eurodollar Loans, and the
Company shall, on the last day(s) of the then current Interest Period(s) for the
outstanding Eurodollar Loans, either prepay such Loans or Convert such Loans
into Base Rate Loans in accordance with Section 2.08 hereof.
5.03 Illegality. Notwithstanding any other provision of this Agreement,
in the event that it becomes unlawful for any Lender or its Applicable Lending
Office to honor its obligation to make or maintain Eurodollar Loans hereunder,
then such Lender shall promptly notify the Company thereof (with a copy to the
Administrative Agent) and such Lender's obligation to make or Continue, or to
Convert Loans of any other Type into, Eurodollar Loans shall be suspended until
such time as such Lender may again make and maintain Eurodollar Loans (in which
case the provisions of Section 5.04 hereof shall be applicable).
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<PAGE> 25
5.04 Treatment of Affected Loans. If the obligation of any Lender to
make Eurodollar Loans or to Continue, or to Convert Base Rate Loans into,
Eurodollar Loans shall be suspended pursuant to Section 5.01 or 5.03 hereof,
such Lender's Eurodollar Loans shall be automatically Converted into Base Rate
Loans on the last day(s) of the then current Interest Period(s) for Eurodollar
Loans (or, in the case of a Conversion required by Section 5.01(b) or 5.03
hereof, on such earlier date as such Lender may specify to the Company with a
copy to the Administrative Agent) and, unless and until such Lender gives notice
as provided below that the circumstances specified in Section 5.01 or 5.03
hereof that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans have
been so Converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Eurodollar Loans shall be applied
instead to its Base Rate Loans; and
(b) all Loans that would otherwise be made or Continued by
such Lender as Eurodollar Loans shall be made or Continued instead as
Base Rate Loans, and all Base Rate Loans of such Lender that would
otherwise be Converted into Eurodollar Loans shall remain as Base Rate
Loans.
If such Lender gives notice to the Company with a copy to the Administrative
Agent that the circumstances specified in Section 5.01 or 5.03 hereof that gave
rise to the Conversion or non-Continuation of such Lender's Eurodollar Loans
pursuant to this Section 5.04 no longer exist (which such Lender agrees to do
promptly upon such circumstances ceasing to exist) at a time when Eurodollar
Loans made by other Lenders are outstanding, such Lender's Base Rate Loans shall
be automatically Converted, on the first day(s) of the next succeeding Interest
Period(s) for such outstanding Eurodollar Loans, to the extent necessary so
that, after giving effect thereto, all Loans held by the Lenders holding
Eurodollar Loans and by such Lender are held pro rata (as to principal amounts,
Types and Interest Periods) in accordance with their respective Commitments.
5.05 Compensation. The Company shall pay to the Administrative Agent
for account of each Lender, upon the request of such Lender through the
Administrative Agent, such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss, cost or
expense that such Lender determines is attributable to:
(a) any payment, mandatory or optional prepayment or
Conversion of a Eurodollar Loan made by such Lender for any reason
(including, without limitation, the acceleration of the Loans pursuant
to Section 10 hereof) on a date other than the last day of the Interest
Period for such Loan;
(b) any failure by the Company for any reason (including,
without limitation, the failure of any of the conditions precedent
specified in Section 7 hereof to be satisfied) to borrow a Eurodollar
Loan from such Lender on the date for such borrowing specified in the
relevant notice of borrowing given under Section 2.02 hereof; or
(c) any failure for any reason (including, without limitation,
as provided in Section 5.02 or 5.03 hereof, but excluding as a result
of the failure by such Lender to make a Loan it is obligated to make
hereunder) of a Loan of such Lender to be Continued as or Converted
into a Eurodollar Loan on the date for such Continuation or Conversion
specified in the relevant notice given under Section 2.08 hereof.
Without limiting the effect of the preceding sentence, such compensation shall
include an amount equal to the excess (if any) of (i) the amount of interest
that otherwise would have accrued on the principal amount so paid, prepaid or
Converted or not borrowed, Continued or Converted for the period from the date
of such payment, prepayment, Conversion or failure to borrow, Continue or
Convert to the last day of the then current Interest Period for such Loan (or,
in the case of a failure to borrow, Continue or Convert, the Interest Period for
such Loan that would have commenced on the date specified for such borrowing,
Continuation or Conversion) at the applicable rate of interest for such Loan
provided for herein (less, in the case of any failure to borrow a Eurodollar
Loan, or to Continue a Loan as or to Convert a Loan into a Eurodollar Loan,
solely as a result of the limitation set forth in Section 5.02 or 5.03 hereof,
the Applicable Margin for such Loan) over (ii) the amount of interest that
otherwise would have accrued on such principal amount at a rate per annum equal
to the interest component of the amount such Lender would have bid in the London
interbank market for Dollar deposits of leading banks in amounts
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comparable to such principal amount and with maturities comparable to such
period (as reasonably determined by such Lender).
5.06 U.S. Taxes.
(a) The Company agrees to pay to each Lender that is not a U.S. Person
such additional amounts as are necessary in order that the net payment of any
amount due to such non-U.S. Person hereunder after deduction for or withholding
in respect of any U.S. Tax imposed with respect to such payment (or in lieu
thereof, payment of such U.S. Tax by such non-U.S. Person), will not be less
than the amount stated herein to be then due and payable, provided that the
foregoing obligation to pay such additional amounts shall not apply:
(i) to any payment to a Lender hereunder unless such Lender
is, on the date hereof (or on the date it becomes a Lender as provided
in Section 12.06(b) hereof) and on the date of any change in the
Applicable Lending Office of such Lender, either entitled to submit a
Form W-BEN (relating to such Lender and entitling it to a complete
exemption from withholding on all interest to be received by it
hereunder in respect of the Loans) or Form W-8ECI (relating to all
interest to be received by such Lender hereunder in respect of the
Loans), or
(ii) to any U.S. Tax imposed solely by reason of the failure
by such non-U.S. Person to comply with applicable certification,
information, documentation or other reporting requirements concerning
the nationality, residence, identity or connections with the United
States of America of such non-U.S. Person if such compliance is
required by statute or regulation of the United States of America as a
precondition to relief or exemption from such U.S. Tax, unless such
failure is due to a change in law, treaty or any official
interpretation of any of the foregoing..
For the purposes of this Section 5.06(a), (w) "Form W-BEN" shall mean Form W-BEN
(Certificate of Foreign Status of Beneficial Owner for United States
withholding) of the Department of the Treasury of the United States of America,
(x) "Form W-8ECI" shall mean Form W-8ECI (Certificate of Foreign Person's Claim
for Exemption from Withholding on Income Effectively Connected with the Conduct
of a Trade or Business in the United States) of the Department of the Treasury
of the United States of America (or in relation to either such Form such
successor and related forms as may from time to time be adopted by the relevant
taxing authorities of the United States of America to document a claim to which
such Form relates), (y) "U.S. Person" shall mean a citizen, national or resident
of the United States of America, a corporation, partnership or other entity
created or organized in or under any laws of the United States of America, or
any estate or trust that is subject to Federal income taxation regardless of the
source of its income and (z) "U.S. Taxes" shall mean any present or future tax,
assessment or other charge or levy imposed by or on behalf of the United States
of America or any taxing authority thereof or therein.
(b) Within 30 days after paying any amount to the Administrative Agent
or any Lender from which it is required by law to make any deduction or
withholding, and within 30 days after it is required by law to remit such
deduction or withholding to any relevant taxing or other authority, the Company
shall deliver to the Administrative Agent for delivery to such non-U.S. Person
evidence satisfactory to such Person of such deduction, withholding or payment
(as the case may be).
(c) Each Lender that is a Lender on the Closing Date and is not a U.S.
Person agrees to furnish to the Administrative Agent (with a copy to the
Company) on the Closing Date an appropriately completed Form 1001 or Form 4224
and each Lender that becomes a Lender after the Closing Date pursuant to Section
12.06(b) hereof and is not a U.S. Person agrees to furnish to the Administrative
Agent (with a copy to the Company), promptly after becoming a Lender, an
appropriately completed Form 1001 or Form 4224.
5.07 Replacement of Certain Lenders.
(a) Provided that no Default shall have occurred and be continuing, the
Company may, at any time, replace any Lender (i) that has requested compensation
from the Company pursuant to Section 5.01 hereof or (ii) that has given the
Company the notice contemplated by Section 5.03 hereof or (iii) which is not a
U.S. Person and as to which the Company is obligated to make payments under
Section 5.06 hereof, by giving not less than ten Business
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Days' prior notice to the Administrative Agent (which shall promptly notify such
Lender), that it intends to replace such Lender with one or more banks or other
financial institutions (including, but not limited to, any other Lender under
this Agreement) selected by the Company that (a) have agreed to replace such
Lender as provided in this Section 5.07 and (b) are reasonably acceptable to the
Administrative Agent (the Administrative Agent agreeing not to unreasonably
delay notifying the Company whether a proposed replacement lender is
acceptable). Upon the effective date of any replacement under this Section 5.07
and as a condition to such replacement, the replacement lender or lenders shall
pay to the Lender being replaced the principal of the Loans held by such Lender
and the Company shall pay to such Lender all accrued interest on such Loans and
all other amounts owing to such Lender hereunder (including any amounts payable
under Section 5.05 hereof as if such Loans were being prepaid by the Company),
whereupon each such replacement bank (if not already a Lender) shall become a
"Lender" for all purposes of this Agreement.
(b) If any Lender that is a Reference Bank (or a Wholly Owned
Subsidiary of a Reference Bank, as the case may be) shall be replaced pursuant
to this Section 5.07, such Reference Bank shall thereupon cease to be a
Reference Bank and, if as a result of the foregoing, there shall only be two
Reference Banks remaining, then the Administrative Agent (after consultation
with the Company) shall, by notice to the Company and the Banks, designate
another Lender as a Reference Bank, so that there shall at all times be three
Reference Banks.
5.08 Consistent Treatment. Each Lender shall apply the provisions of
this Section 5 in substantially the same manner, and to the same extent, as such
Lender applies comparable provisions applicable to similarly-situated borrowers.
Section 6. Guarantee.
6.01 Guarantee. The Subsidiary Guarantors hereby jointly and severally
guarantee to each Lender and the Administrative Agent and their respective
successors and assigns the prompt payment in full when due (whether at stated
maturity, by acceleration or otherwise) of the principal of and interest on the
Loans made by the Lenders to, and the Note held by each Lender of, the Company
and all other amounts from time to time owing to the Lenders or the
Administrative Agent by the Company under this Agreement and under the Notes and
by any Obligor under any of the other Basic Documents, in each case strictly in
accordance with the terms thereof (and giving effect to any amendment or
modification of such terms), including all amounts which would become due but
for the operation of the automatic stay under Section 362(a) of the Bankruptcy
Code and the operation of Sections 502(b) and 506(b) of the Bankruptcy Code
(such obligations being herein collectively called the "Guaranteed
Obligations"). The Subsidiary Guarantors hereby further jointly and severally
agree that if the Company shall fail to pay in full when due (whether at stated
maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the
Subsidiary Guarantors will promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of payment or renewal
of any of the Guaranteed Obligations, the same will be promptly paid in full
when due (whether at extended maturity, by acceleration or otherwise) in
accordance with the terms of such extension or renewal.
6.02 Obligations Unconditional. The obligations of the Subsidiary
Guarantors under Section 6.01 hereof are absolute and unconditional, joint and
several, irrespective of the value, genuineness, validity, regularity or
enforceability of the obligations of the Company under this Agreement, the Notes
or any other agreement or instrument referred to herein or therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever which might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Section 6.02 that the obligations of each
of the Subsidiary Guarantors hereunder shall be absolute and unconditional,
joint and several, under any and all circumstances. Without limiting the
generality of the foregoing, it is agreed that the occurrence of any one or more
of the following shall not alter or impair the liability of any of the
Subsidiary Guarantors hereunder, which liabilities shall remain absolute and
unconditional as described above:
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(i) at any time or from time to time, without notice to the
Subsidiary Guarantors, the time for any performance of or compliance
with any of the Guaranteed Obligations shall be extended, or such
performance or compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of
this Agreement or the Notes or any other agreement or instrument
referred to herein or therein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall
be accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under this
Agreement or the Notes or any other agreement or instrument referred to
herein or therein shall be waived or any other guarantee of any of the
Guaranteed Obligations (including the Guarantee hereunder of any other
Subsidiary Guarantor) or any security therefor shall be released or
exchanged in whole or in part or otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor of,
the Administrative Agent or any Lender or Lenders as security for any
of the Guaranteed Obligations shall fail to be perfected.
The Subsidiary Guarantors hereby expressly waive diligence, presentment, demand
of payment, protest and all notices whatsoever, and any requirement that the
Administrative Agent or any Lender exhaust any right, power or remedy or proceed
against the Company under this Agreement or the Notes or any other agreement or
instrument referred to herein or therein, or against any other Person under any
other guarantee of, or security for, any of the Guaranteed Obligations.
6.03 Reinstatement. The obligations of the Subsidiary Guarantors under
this Section 6 shall be automatically reinstated if and to the extent that for
any reason any payment by or on behalf of the Company in respect of the
Guaranteed Obligations is rescinded or must be otherwise restored by any holder
of any of the Guaranteed Obligations, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise and the Subsidiary Guarantors jointly
and severally agree that they will indemnify the Administrative Agent and each
Lender on demand for all reasonable costs and expenses (including, without
limitation, reasonable fees of counsel) incurred by the Administrative Agent or
such Lender in connection with such rescission or restoration, including any
such costs and expenses incurred in defending against any claim alleging that
such payment constituted a preference, fraudulent transfer or similar payment
under any bankruptcy, insolvency or similar law.
6.04 Subrogation. Each Subsidiary Guarantor hereby jointly and
severally agrees that until the payment and satisfaction in full of all
Guaranteed Obligations and the expiration and termination of the Commitments of
the Lenders under this Agreement, they shall not exercise any right or remedy
arising by reason of any performance by them of their guarantee in Section 6.01
hereof, whether by subrogation or otherwise, against the Company or any other
guarantor of any of the Guaranteed Obligations or any security for any of the
Guaranteed Obligations.
6.05 Remedies. The Subsidiary Guarantors jointly and severally agree
that, as between the Subsidiary Guarantors and the Lenders, the obligations of
the Company under this Agreement and the Notes may be declared to be forthwith
due and payable as provided in Section 10 hereof (and shall be deemed to have
become automatically due and payable in the circumstances provided in said
Section 10) for purposes of Section 6.01 hereof notwithstanding any stay,
injunction or other prohibition preventing such declaration (or such obligations
from becoming automatically due and payable) as against the Company and that, in
the event of such declaration (or such obligations being deemed to have become
automatically due and payable), such obligations (whether or not due and payable
by the Company) shall forthwith become due and payable by the Subsidiary
Guarantors for purposes of said Section 6.01.
6.06 Continuing Guarantee. The guarantee in this Section 6 is a
continuing guarantee, and shall apply to all Guaranteed Obligations whenever
arising.
6.07 Rights of Contribution. The Subsidiary Guarantors hereby agree, as
between themselves, that if any Subsidiary Guarantor (an "Excess Funding
Guarantor") shall pay Guaranteed Obligations in excess of such Excess Funding
Guarantor's Pro Rata Share (as defined below) of such Guaranteed Obligations
(such excess payment, an
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"Excess Payment"), each other Subsidiary Guarantor shall, on demand of such
Excess Funding Guarantor (but subject to the next sentence hereof), pay to such
Excess Funding Guarantor an amount equal to such other Subsidiary Guarantor's
Pro Rata Share (such Pro Rata Share, for the purpose of determining the amount
due to the Excess Funding Guarantor under this Section 6.07, to be determined
without reference to the Excess Funding Guarantor) of such Excess Payment. The
payment obligation of each other Subsidiary Guarantor to an Excess Funding
Guarantor under this Section 6.07 shall be subordinate and subject in right of
payment to the prior payment in full of the obligations of such Subsidiary
Guarantor under the other provisions of this Section 6, and such Excess Funding
Guarantor shall not exercise any right or remedy with respect to such Excess
Payment until payment and satisfaction in full of all of such obligations. For
the purposes hereof, "Pro Rata Share" shall mean, with respect to each
Subsidiary Guarantor, the ratio (expressed as a percentage and determined as of
the Closing Date) of (a) the amount by which the aggregate value of all of the
Properties of such Subsidiary Guarantor at their present fair saleable value
exceeds the amount of all of the debts and liabilities (including contingent,
subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of such Subsidiary Guarantor under this Section 6) of such
Subsidiary Guarantor to (b) the amount by which the aggregate value of all of
the Properties of all of the Subsidiary Guarantors at their present fair
saleable value exceeds the amount of all of the debts and liabilities (including
contingent, subordinated, unmatured and unliquidated liabilities, but excluding
the obligations of such Subsidiary Guarantor under this Section 6) of all of the
Subsidiary Guarantors.
6.08 Limitation on Guarantee Obligations. In any action or proceeding
involving any state corporate law, or any state or Federal bankruptcy,
insolvency, reorganization or other law affecting the rights of creditors
generally, if the obligations of any Subsidiary Guarantor under Section 6.01
hereof would otherwise, taking into account the provisions of Section 6.07
hereof, be held or determined to be void, invalid or unenforceable, or
subordinated to the claims of any other creditors, on account of the amount of
its liability under said Section 6.01, then, notwithstanding any other provision
hereof to the contrary, the amount of such liability shall, without any further
action by such Subsidiary Guarantor, any Lender, the Administrative Agent or any
other Person, be automatically limited and reduced to the highest amount which
is valid and enforceable and not subordinated to the claims of other creditors
as determined in such action or proceeding.
6.09 Release of Guarantors. A Subsidiary Guarantor shall be released
from its guarantee obligations under Section 6 hereof upon the request of the
Company, so long as (a) such Subsidiary Guarantor is not B. Dalton Bookseller,
Inc., Barnes & Noble Booksellers, Inc. or Doubleday Book Shops, Inc. and (b) the
aggregate fair market value of the assets of all such Released Guarantors
calculated as of the time of the respective release does not exceed
$100,000,000. In the event that any Subsidiary Guarantor is so released, from
and after the date of such release:
(i) all financial reports delivered pursuant to this Agreement
shall be prepared as if such Subsidiary was not a Subsidiary of the
Company (and, in addition, the Company shall furnish the financial
reports currently required under Section 9.01(a) and 9.01(b)); and
(ii) all covenants in Sections 9.10 and 9.11 hereof shall be
calculated as if such Subsidiary was not a Subsidiary of the Company.
Section 7. Conditions Precedent.
7.01 Initial Loans. The obligation of any Lender to make its initial
Loan hereunder is subject to the receipt by the Administrative Agent of the
following documents, each of which shall be satisfactory to the Administrative
Agent in form and substance:
(a) Corporate Documents. The following documents, each
certified as indicated below:
(i) for each Obligor, a copy of the charter, as
amended and in effect, of such Obligor certified as of a
recent date by the Secretary of State of its jurisdiction of
incorporation, and a certificate from such Secretary of State
dated as of a recent date as to the good standing of and
charter documents filed by such Obligor;
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(ii) for each Obligor, a certificate of the Secretary
or an Assistant Secretary of such Obligor, dated the Closing
Date and certifying (A) that attached thereto is a true and
complete copy of the by-laws of such Obligor as amended and in
effect at all times from the date on which the resolutions
referred to in clause (B) were adopted to and including the
date of such certificate, (B) that attached thereto is a true
and complete copy of resolutions duly adopted by the board of
directors of such Obligor authorizing the execution, delivery
and performance of such of the Basic Documents to which such
Obligor is or is intended to be a party and the extensions of
credit hereunder, and that such resolutions have not been
modified, rescinded or amended and are in full force and
effect, (C) that the charter of such Obligor has not been
amended since the date of the certification thereto furnished
pursuant to subparagraph (i) above, and (D) as to the
incumbency and specimen signature of each officer of such
Obligor executing such of the Basic Documents to which such
Obligor is intended to be a party and each other document to
be delivered by such Obligor from time to time in connection
therewith (and the Administrative Agent and each Lender may
conclusively rely on such certificate until it receives notice
in writing from such Obligor); and
(iii) for each Obligor, a certificate of another
officer of such Obligor as to the incumbency and specimen
signature of the Secretary or Assistant Secretary, as the case
may be, of such Obligor.
(b) Officer's Certificate. A certificate of a senior officer
of the Company, dated the Closing Date, to the effect set forth in the
first sentence of Section 7.02 hereof.
(c) Opinion of Counsel to the Obligors. An opinion, dated the
Closing Date, of Robinson Silverman Pearce Aronsohn & Berman LLP,
counsel to the Obligors, substantially in the form of Exhibit B-1
hereto and covering such other matters as the Administrative Agent may
reasonably request (and each Obligor hereby instructs such counsel to
deliver such opinions to the Lenders and the Administrative Agent).
(d) Opinion of Special New York Counsel to Chase. An opinion,
dated the Closing Date, of Mayer, Brown & Platt, special New York
counsel to Chase, substantially in the form of Exhibit B-2 hereto.
(e) Notes. The Notes, duly completed and executed.
(f) Other Documents. Such other documents as the
Administrative Agent or special New York counsel to Chase may
reasonably request.
The obligation of any Lender to make its initial Loan hereunder is also subject
to the payment by the Company of such fees and reimbursement for expenses as the
Company shall have agreed to pay to any Lender or the Administrative Agent in
connection herewith, including, without limitation, the reasonable fees and
expenses of Mayer, Brown & Platt, special New York counsel to Chase in
connection with the negotiation, preparation, execution and delivery of this
Agreement and the Notes and the other Basic Documents and the extensions of
credit hereunder (to the extent that statements for such fees and expenses have
been delivered to the Company), provided that such fees and expenses may be paid
with the proceeds of the Loans made hereunder on the Closing Date.
7.02 Initial and Subsequent Extensions of Credit. The obligation of the
Lenders to make any Loan or otherwise extend any credit to the Company upon the
occasion of each borrowing hereunder (including the initial Loans) is subject to
the further conditions precedent that, both immediately prior to the making of
such Loan and also after giving effect thereto and to the intended use thereof:
(a) no Default shall have occurred and be continuing; and
(b) the representations and warranties made by the Obligors in
Section 8 hereof, and by each Obligor in each of the other Basic
Documents to which it is a party, shall be true and complete on and as
of the date of the making of such Loan with the same force and effect
as if made on and as of such date (or, if
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any such representation or warranty is expressly stated to have been
made as of a specific date, as of such specific date).
Each notice of borrowing by the Company hereunder shall constitute a
certification by the Company to the effect set forth in the preceding sentence
(both as of the date of such notice or request and, unless the Company otherwise
notifies the Administrative Agent prior to the date of such borrowing or
issuance, as of the date of such borrowing or issuance).
Section 8. Representations and Warranties. Each Obligor represents and
warrants to the Administrative Agent and the Lenders that:
8.01 Corporate Existence. Each of the Company and its Subsidiaries
(other than Unrestricted Subsidiaries and Released Guarantors): (a) is a
corporation, partnership or other entity duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization; (b) has
all requisite corporate or other power, and has all material governmental
licenses, authorizations, consents and approvals, necessary to own its assets
and carry on its business as now being or as proposed to be conducted; and (c)
is qualified to do business and is in good standing in all jurisdictions in
which the nature of the business conducted by it makes such qualification
necessary and where failure so to qualify could, either individually or in the
aggregate, have a Material Adverse Effect.
8.02 Financial Condition. The Company has heretofore furnished to each
of the Lenders the consolidated balance sheet of the Company and its
Consolidated Subsidiaries as at January 29, 2000, and the related consolidated
statements of income and cash flows of the Company and its Consolidated
Subsidiaries for the fiscal year ended on said date, with the opinion thereon of
BDO Seidman, and the unaudited consolidated balance sheet of the Company and its
Consolidated Subsidiaries as at July 29, 2000 and the related unaudited
consolidated statements of income and cash flows of the Company and the
Consolidated Subsidiaries for the six-month period ended on such date. Such
financial statements are complete and correct and fairly present the
consolidated financial condition of the Company and its Consolidated
Subsidiaries as at said date and the consolidated results of their operations
for the fiscal year ended on said date, all in accordance with generally
accepted accounting principles and practices applied on a consistent basis. None
of the Company nor any of its Subsidiaries has on the date hereof any material
contingent liabilities, liabilities for taxes, unusual forward or long-term
commitments or unrealized or anticipated losses from any unfavorable
commitments, except as referred to or reflected or provided for in said
financial statements (or in the notes thereto) as at said date. Since July 29,
2000, there has been no material adverse change in the consolidated financial
condition or operations of the Company and its Consolidated Subsidiaries taken
as a whole from that set forth in said financial statements as at said date.
8.03 Litigation. There are no legal or arbitral proceedings, or any
proceedings by or before any governmental or regulatory authority or agency, now
pending or (to the knowledge of the Company) threatened against the Company or
any of its Subsidiaries that would reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect.
8.04 No Breach. None of the execution and delivery of this Agreement
and the Notes and the other Basic Documents, the consummation of the
transactions herein and therein contemplated or compliance with the terms and
provisions hereof and thereof will conflict with or result in a breach of, or
require any consent under, the charter or by-laws of any Obligor, or any
applicable law or regulation, or any order, writ, injunction or decree of any
court or governmental authority or agency, or any agreement or instrument to
which the Company or any of its Subsidiaries is a party or by which any of them
or any of their Property is bound or to which any of them is subject, or
constitute a default under any such agreement or instrument, or result in the
creation or imposition of any Lien upon any material Property of the Company or
any of its Subsidiaries pursuant to the terms of any such agreement or
instrument.
8.05 Action. Each Obligor has all necessary corporate power, authority
and legal right to execute, deliver and perform its obligations under each of
the Basic Documents to which it is a party; the execution, delivery and
performance by each Obligor of each of the Basic Documents to which it is a
party have been duly authorized by all
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necessary corporate action on its part (including, without limitation, any
required shareholder approvals); and this Agreement has been duly and validly
executed and delivered by each Obligor and constitutes, and each of the Notes
and the other Basic Documents when executed and delivered by each Obligor party
thereto (in the case of the Notes, for value) will constitute, the legal, valid
and binding obligation of each Obligor party thereto, enforceable against such
Obligors in accordance with its terms, except as such enforceability may be
limited by (a) bankruptcy, insolvency, reorganization, moratorium or similar
laws of general applicability affecting the enforcement of creditors' rights and
(b) the application of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
8.06 Approvals. No authorizations, approvals or consents of, and no
filings or registrations with, any governmental or regulatory authority or
agency, or any securities exchange, are necessary for the execution, delivery or
performance by any Obligor of the Basic Documents to which it is a party or for
the legality, validity or enforceability hereof or thereof.
8.07 Use of Credit. Neither the Company nor any of its Subsidiaries
(other than Unrestricted Subsidiaries) is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose,
whether immediate, incidental or ultimate, of buying or carrying Margin Stock,
and no part of the proceeds of any Loan hereunder will be used to buy or carry
any Margin Stock.
8.08 ERISA. As to each Plan, and, to the knowledge of the Company, as
to each Multiemployer Plan, (a) such Plan or Multiemployer Plan is in compliance
in all material respects with, and has been administered in all material
respects in compliance with, the applicable provisions of ERISA, the Code and
any other Federal or State law, and (b) no event or condition has occurred and
is continuing as to which the Company would be under an obligation to furnish a
report to the Lenders under Section 9.01(d) hereof.
8.09 Taxes. The Company and its Consolidated Subsidiaries are members
of an affiliated group of corporations filing consolidated returns for Federal
income tax purposes, of which the Company is the "common parent" (within the
meaning of Section 1504 of the Code) of such group. The Company and its
Consolidated Subsidiaries have filed all Federal income tax returns and all
other material tax returns that are required to be filed by them and have paid
all taxes due pursuant to such returns or pursuant to any assessment received by
the Company or any of its Consolidated Subsidiaries. The charges, accruals and
reserves on the books of the Company and its Consolidated Subsidiaries in
respect of taxes and other governmental charges are, in the opinion of the
Company, adequate.
8.10 Investment Company Act. Neither the Company nor any of its
Subsidiaries is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended.
8.11 Public Utility Holding Company Act. Neither the Company nor any of
its Subsidiaries is a "holding company", or an "affiliate" of a "holding
company" or a "subsidiary company" of a "holding company", within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
8.12 Material Agreements and Liens.
(a) Part A of Schedule I hereto is a complete and correct list, as of
the date of this Agreement, of each credit agreement, loan agreement, indenture,
securities purchase agreement, letter of credit or other arrangement providing
for or otherwise relating to any Indebtedness or any extension of credit (or
commitment for any extension of credit), other than any trade accounts payable
(except trade accounts payable for borrowed money), to, or guarantee of any of
the foregoing by, the Company or any of its Subsidiaries (other than any
guarantees by any Obligor of obligations of Subsidiary Guarantors under leases),
and the aggregate principal or face amount outstanding or that may become
outstanding under each such arrangement is correctly described in Part A of said
Schedule I.
(b) Part B of Schedule I hereto is a complete and correct list, as of
the date of this Agreement, of each Lien securing Indebtedness of any Person and
covering any Property of the Company or any of its Subsidiaries, and the
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aggregate Indebtedness secured (or which may be secured) by each such Lien and
the Property covered by each such Lien is correctly described in Part B of said
Schedule I.
8.13 Environmental Matters. Each of the Company and its Subsidiaries
(other than Unrestricted Subsidiaries) has obtained all permits, licenses and
other authorizations required under all applicable Environmental Laws to carry
on its business as now being or as proposed to be conducted, except to the
extent failure to have any such permit, license or authorization would not,
either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Each of such permits, licenses and authorizations is in
full force and effect, and each of the Company and its Subsidiaries (other than
Unrestricted Subsidiaries) is in compliance with the terms and conditions
thereof and is also in compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules and
timetables contained in any applicable Environmental Law or in any regulation,
code, plan, order, decree, judgment, injunction, notice or demand letter issued,
entered, promulgated or approved thereunder, except to the extent failure to
comply therewith would not, either individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect. In addition, no notice,
notification, demand, request for information, citation, summons or order has
been issued, no complaint has been filed, no penalty has been assessed and no
investigation or review is pending or (to the knowledge of the Company)
threatened by any governmental or other entity with respect to any alleged
failure by the Company or any of its Subsidiaries (other than Unrestricted
Subsidiaries) to have any permit, license or other authorization required under
any applicable Environmental Law in connection with the conduct of the business
of the Company or any of its Subsidiaries (other than Unrestricted Subsidiaries)
or with respect to any generation, treatment, storage, recycling,
transportation, discharge or disposal, or any Release of any Hazardous Materials
generated by the Company or any of its Subsidiaries (other than Unrestricted
Subsidiaries).
8.14 Capitalization. The authorized capital stock of the Company
consists, on the Closing Date, of an aggregate of 300,000,000 shares of common
stock, par value $.001 per share, and 5,000,000 shares of preferred stock, par
value $.001 per share, of which 69,696,902 shares of common stock are duly and
validly issued and outstanding as of July 29, 2000 and each of which shares of
common stock is fully paid and nonassessable, and no shares of preferred stock
have been issued. As of the Closing Date, (x) except for outstanding employee
and director stock options, there are no outstanding Equity Rights with respect
to the Company and (y) there are no outstanding obligations of the Company or
any of its Subsidiaries to repurchase, redeem, or otherwise acquire any shares
of capital stock of the Company.
8.15 Subsidiaries, Etc.
(a) Set forth in Part A of Schedule II hereto is a complete and correct
list, as of the date of this Agreement, of all of the Subsidiaries of the
Company, together with, for each such Subsidiary, (i) the jurisdiction of
organization of such Subsidiary, (ii) each Person holding ownership interests in
such Subsidiary and (iii) the nature of the ownership interests held by each
such Person and the percentage of ownership of such Subsidiary represented by
such ownership interests. Except as disclosed in Part A of Schedule II hereto,
as of the date of this Agreement (x) each of the Company and its Subsidiaries
owns, free and clear of Liens (other than Liens described on Part B of Schedule
I hereto), and has the unencumbered right to vote, all outstanding ownership
interests in each Person shown to be held by it in Part A of Schedule II hereto,
(y) all of the issued and outstanding capital stock of each such Person
organized as a corporation is validly issued, fully paid and nonassessable and
(z) there are no outstanding Equity Rights with respect to such Person.
(b) Set forth in Part B of Schedule II hereto is a complete and correct
list, as of the date of this Agreement, of all Investments (other than Permitted
Investments and Investments disclosed in Part A of said Schedule II hereto) held
by the Company or any of its Subsidiaries in any Person and, for each such
Investment, (x) the identity of the Person or Persons holding such Investment
and (y) the nature of such Investment. Except as disclosed in Part B of Schedule
II hereto, as of the date of this Agreement, each of the Company and its
Subsidiaries owns, free and clear of all Liens (other than Liens described on
Part B of Schedule I hereto), all such Investments.
8.16 True and Complete Disclosure. The information, reports, financial
statements, exhibits and schedules furnished in writing by or on behalf of any
Obligor or any of its Subsidiaries to the Administrative Agent or any Lender in
connection with the negotiation, preparation or delivery of this Agreement and
the other Basic Documents or included herein or therein or delivered pursuant
hereto or thereto, when taken as a whole, do not, as of the date
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hereof, contain any untrue statement of material fact or omit to state any
material fact necessary to make the statements herein or therein, in light of
the circumstances under which they were made, not misleading. All written
information furnished after the date hereof by the Company and its Subsidiaries
to the Administrative Agent and the Lenders in connection with this Agreement
and the other Basic Documents and the transactions contemplated hereby and
thereby will be true, complete and accurate in every material respect, or (in
the case of projections) based on reasonable estimates, on the date as of which
such information is stated or certified. To the Company's knowledge, there is no
fact peculiar to the Company or any of its Subsidiaries (other than Unrestricted
Subsidiaries) that could have a Material Adverse Effect that has not been
disclosed herein, in the other Basic Documents or in a report, financial
statement, exhibit, schedule, disclosure letter or other writing furnished to
the Lenders for use in connection with the transactions contemplated hereby or
thereby.
Section 9. Covenants of the Company. Each Obligor covenants and agrees
with the Lenders and the Administrative Agent that, so long as any Commitment or
Loan is outstanding and until payment in full of all amounts payable by the
Company hereunder:
9.01 Financial Statements; Information; Etc. The Company will deliver
to the Agent in sufficient quantities for it to deliver to each of the Lenders:
(a) as soon as possible and in any event:
(i) as soon as available and in any event within 45
days after the end of each of the first three fiscal quarters
of the Company, the Company's quarterly report on form 10-Q
for such fiscal quarter, which includes consolidated financial
statements of the Company and its Consolidated Subsidiaries
for such fiscal quarter; and
(ii) within 45 days after the end of each of the
first three fiscal quarters of the Company, a certificate of
the Company signed by a senior financial officer (including
the treasurer) of the Company setting forth the information
called for by Exhibit C hereto.
(b) promptly upon their becoming available, copies of all
registration statements and regular periodic reports (which shall
include form 8-Ks), if any, which the Company shall have filed with the
Securities and Exchange Commission (or any governmental agency
substituted therefor) or any national securities exchange;
(c) promptly upon the mailing thereof to the public
shareholders of the Company, if any, generally, copies of all financial
statements, reports and proxy statements so mailed;
(d) as soon as possible, and in any event within ten days
after the Company knows or has reason to believe that any of the events
or conditions specified below with respect to any Plan or Multiemployer
Plan has occurred or exists, a statement signed by a senior financial
officer (including the treasurer) of the Company setting forth details
respecting such event or condition and the action, if any, that the
Company or its ERISA Affiliate proposes to take with respect thereto
(and a copy of any report or notice required to be filed with or given
to PBGC by the Company or an ERISA Affiliate with respect to such event
or condition):
(i) any reportable event, as defined in Section
4043(b) of ERISA and the regulations issued thereunder, with
respect to a Plan, as to which PBGC has not by regulation
waived the requirement of Section 4043(a) of ERISA that it be
notified within 30 days of the occurrence of such event
(provided that such statement shall be required for a failure
to meet the minimum funding standard of Section 412 of the
Code or Section 302 of ERISA, including, without limitation,
the failure to make on or before its due date a required
installment under Section 412(m) of the Code or Section 302(e)
of ERISA, regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code unless the present
value of unfunded vested
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benefits under the applicable Plan, as determined under PBGC
Reg. Sec. 2615.16(b), is less than $5,000,000); and any
request for a waiver under Section 412(d) of the Code for any
Plan;
(ii) the distribution under Section 4041 of ERISA of
a notice of intent to terminate any Plan or any action taken
by the Company or an ERISA Affiliate to terminate any Plan;
(iii) the institution by PBGC of proceedings under
Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from
a Multiemployer Plan that such action has been taken by PBGC
with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal from a
Multiemployer Plan by the Company or any ERISA Affiliate that
results in liability under Section 4201 or 4204 of ERISA
(including the obligation to satisfy secondary liability as a
result of a purchaser default) or the receipt by the Company
or any ERISA Affiliate of notice from a Multiemployer Plan
that it is in reorganization or insolvency pursuant to Section
4241 or 4245 of ERISA or that it intends to terminate or has
terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary of
any Multiemployer Plan against the Company or any ERISA
Affiliate to enforce Section 515 of ERISA, which proceeding is
not dismissed within 60 days; and
(vi) the adoption of an amendment to any Plan that,
pursuant to Section 401(a)(29) of the Code or Section 307 of
ERISA, would result in the loss of tax-exempt status of the
trust of which such Plan is a part if the Company or an ERISA
Affiliate fails to timely provide security to the Plan in
accordance with the provisions of said Sections;
(e) promptly after the Company knows or has reason to believe
that any Default has occurred, a notice of such Default specifying that
such notice is a "Notice of Default" and describing the same in
reasonable detail and, together with such notice or as soon thereafter
as possible, a description of the action that the Company has taken or
proposes to take with respect thereto; and
(f) from time to time such other information regarding the
Property, financial condition or operations of the Company or any of
its Subsidiaries (including, without limitation, any Plan or
Multiemployer Plan and any reports or other information required to be
filed under ERISA) as any Lender or the Administrative Agent may
reasonably request.
The Company will furnish to the Agent with sufficient copies for the Agent to
deliver to each Lender, at the time it furnishes each set of financial
statements pursuant to paragraph (a) or (b) above, a certificate of a senior
financial officer (including the treasurer) of the Company (i) to the effect
that no Default has occurred and is continuing (or, if any Default has occurred
and is continuing, describing the same in reasonable detail and describing the
action that the Company has taken or proposes to take with respect thereto) and
(ii) setting forth in reasonable detail the computations necessary to determine
whether the Company is in compliance with Sections 9.10 and 9.11 hereof as of
the end of the respective quarterly fiscal period or fiscal year.
9.02 Litigation. The Company will promptly give to each Lender notice
of all legal or arbitral proceedings, and of all proceedings by or before any
governmental or regulatory authority or agency, and any material development in
respect of such legal or other proceedings (excluding, in any event, proceedings
related to the promulgation of laws or regulations of general applicability),
affecting the Company or any of its Subsidiaries, except proceedings which would
not reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect. Without limiting the generality of the foregoing, the
Company will give to each Lender notice of the assertion of any Environmental
Claim by any Person against, or with respect to the activities of, the Company
or any of its Subsidiaries and notice of any alleged violation of or
non-compliance by the Company or any of its Subsidiaries with any applicable
Environmental Law or any permit, license or authorization required under any
such Environmental Law, other than any Environmental Claim or alleged violation
that, and any such
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<PAGE> 36
non-compliance that, would not reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect.
9.03 Existence, Etc. The Company will, and will cause each of its
Subsidiaries (other than Unrestricted Subsidiaries and Released Guarantors) to:
(a) preserve and maintain its legal existence and (unless the
loss of the same would not have a material adverse effect on the
Company or such Subsidiary, as the case may be) all of its material
rights, privileges, licenses and franchises (provided that nothing in
this Section 9.03 shall prohibit any transaction expressly permitted by
Section 9.05 hereof);
(b) comply with the requirements of all applicable laws,
rules, regulations and orders of governmental or regulatory authorities
if failure to comply with such requirements could, either individually
or in the aggregate, have a Material Adverse Effect;
(c) pay and discharge all taxes, assessments and governmental
charges or levies imposed on it or on its income or profits or on any
of its Property prior to the date on which penalties attach thereto,
except for any such tax, assessment, charge or levy the payment of
which is being contested in good faith and by proper proceedings and
against which adequate reserves are being maintained in accordance with
GAAP;
(d) maintain all of its Properties used or useful in its
business in good working order and condition, ordinary wear and tear
excepted;
(e) keep adequate records and books of account, in which
complete entries will be made in accordance with generally accepted
accounting principles consistently applied; and
(f) permit the Administrative Agent (and, if any Default shall
be continuing, any representatives of any Lender), during normal
business hours and upon reasonable prior written notice (and in any
event no less than two Business Days prior notice), to examine, copy
and make extracts from its books and records, to inspect any of its
Properties, and to discuss its business and affairs with its officers,
all to the extent reasonably requested (as to both the manner of such
examination, copying, extracting, inspection or discussion, and the
scope thereof) by such Lender or the Administrative Agent (as the case
may be).
9.04 Insurance. The Company will, and will cause each of its
Subsidiaries to, keep insured by financially sound and reputable insurers or, to
the extent consistent with the practice of corporations of similar size engaged
in the retailing business, through self-insurance all Property of a character
usually insured by corporations engaged in the same or similar business
similarly situated against loss or damage of the kinds and in the amounts, and
with such deductibles and limits on coverage, as are customarily insured against
by such corporations and carry such other insurance as is usually carried by
such corporations.
9.05 Prohibition of Fundamental Changes.
(a) The Company will not, and will not permit any of its Subsidiaries
(other than Unrestricted Subsidiaries and Released Guarantors) to, enter into
any transaction of merger or consolidation or amalgamation, or liquidate, wind
up or dissolve itself (or suffer any liquidation or dissolution).
(b) The Company will not, and will not permit any of its Subsidiaries
(other than Unrestricted Subsidiaries and Released Guarantors) to, acquire any
business or Property from, or capital stock of, or be a party to any acquisition
of, any Person.
(c) The Company will not, and will not permit any of its Subsidiaries
(other than Unrestricted Subsidiaries and Released Guarantors) to, convey, sell,
lease, transfer or otherwise dispose of, in one transaction or a series of
transactions, any part of its business or Property, whether now owned or
hereafter acquired (including, without limitation, receivables and leasehold
interests).
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(d) Notwithstanding the foregoing paragraphs of this Section 9.05:
(i) any Subsidiary of the Company may be merged or
consolidated with or into the Company, if the Company shall be the
continuing or surviving corporation, or with or into any other
Subsidiary (other than an Unrestricted Subsidiary or a Released
Guarantor) of the Company;
(ii) the Company or any of its Subsidiaries may purchase
inventory and other Property to be sold or used in the ordinary course
of business, make Investments permitted by Section 9.08 hereof, make
Capital Expenditures permitted by Section 9.11 hereof and make Dividend
Payments pursuant to Section 9.09 hereof;
(iii) the Company or any of its Subsidiaries may convey, sell,
lease, transfer or otherwise dispose of (x) obsolete or worn-out
Property, tools or equipment no longer used or useful in its business
so long as the aggregate fair market value thereof sold in any single
fiscal year by the Company and its Subsidiaries (other than
Unrestricted Subsidiaries and Released Guarantors) shall not exceed
$20,000,000, and (y) any inventory or other Property sold or disposed
of in the ordinary course of business and on ordinary business terms;
(iv) the Company or any Subsidiary of the Company may acquire,
or otherwise make Investments in, the capital stock of, Equity Rights
in, and/or assets of, companies the principal business of which is
substantially related or complementary to the existing lines of
business of the Company and its Subsidiaries (including the financing
of customer purchases) ("Related Businesses"), to the extent permitted
by paragraph (j) of Section 9.08 hereof;
(v) the Company or any Subsidiary of the Company may convey,
sell, lease, transfer or otherwise dispose of, in one transaction or a
series of transactions, (x) any Equity Right in any Released Guarantor
or Unrestricted Subsidiary and (y) any Equity Right held by the Company
or such Subsidiary in any Person that is not a Subsidiary of the
Company; and
(vi) the Company or any Subsidiary of the Company may convey,
sell, lease, transfer or otherwise dispose of, in one transaction or a
series of transactions, the gamestop.com. division of Babbage's Etc.
9.06 Limitation on Liens. The Company will not, and will not permit any
of its Subsidiaries (other than an Unrestricted Subsidiary or a Released
Guarantor) to, create, incur, assume or suffer to exist any Lien upon any of its
Property, whether now owned or hereafter acquired, except:
(a) Liens in existence on the date hereof and listed in Part B
of Schedule I hereto;
(b) Liens imposed by any governmental authority for taxes,
assessments or charges not yet due or which are being contested in good
faith and by appropriate proceedings if, unless the amount thereof is
not material with respect to it or its financial condition, adequate
reserves with respect thereto are maintained on the books of the
Company or the affected Subsidiaries, as the case may be, in accordance
with GAAP;
(c) carriers', warehousemen's, mechanics', materialmen's,
repairmen's, landlord's or other like Liens arising in the ordinary
course of business which are not overdue for a period of more than 60
days or which are being contested in good faith and by appropriate
proceedings and Liens securing judgments but only to the extent for an
amount and for a period not resulting in an Event of Default under
Section 10(h) hereof;
(d) pledges or deposits under worker's compensation,
unemployment insurance and other social security legislation;
(e) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business;
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(f) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and
encumbrances consisting of zoning restrictions, easements, licenses,
restrictions on the use of Property or minor imperfections in title
thereto which, in the aggregate, are not material in amount, and which
do not materially interfere with the ordinary conduct of the business
of the Company or any of its Subsidiaries;
(g) Liens upon Property acquired after the date hereof (by
purchase, construction or otherwise) by the Company or any of its
Subsidiaries, each of which Liens was created solely for the purpose of
securing Indebtedness representing, or incurred to finance, refinance
or refund, the cost (including the cost of construction) of such
Property; provided that (i) no such Lien shall extend to or cover any
Property of the Company or such Subsidiary other than the Property so
acquired and improvements thereon and (ii) the principal amount of
Indebtedness secured by any such Lien shall at no time exceed 90% of
the fair market value (as determined in good faith by a senior
financial officer (including the treasurer) of the Company) of such
Property at the time it was acquired (by purchase, construction or
otherwise);
(h) Liens on Margin Stock held by the Company or any of its
Subsidiaries (other than any capital stock of the Company or any of its
Subsidiaries); and
(i) any extension, renewal or replacement of the foregoing;
provided that the Liens permitted by this paragraph shall not extend to
or cover any additional Indebtedness or Property (other than a
substitution of like Property).
9.07 Indebtedness. The Company will not, and will not permit any of its
Subsidiaries to, create, incur or suffer to exist any Indebtedness except:
(a) Indebtedness to the Lenders hereunder;
(b) Indebtedness outstanding on the date hereof and listed in
Part A of Schedule I hereto;
(c) Indebtedness of Subsidiaries of the Company to the Company
or to other Subsidiaries of the Company (other than Unrestricted
Subsidiaries);
(d) Capital Lease Obligations to the extent permitted by
Section 9.11 hereof;
(e) Indebtedness of Unrestricted Subsidiaries;
(f) Indebtedness of Released Guarantors;
(g) additional Indebtedness of the Company and its
Subsidiaries secured by Liens permitted under Section 9.06(g) hereof in
an aggregate amount up to but not exceeding $40,000,000 at any one time
outstanding; and
(h) Subordinated Debt.
9.08 Investments. The Company will not, and will not permit any of its
Subsidiaries to, make or permit to remain outstanding any Investments except:
(a) Investments outstanding on the date hereof and identified
in Part B of Schedule II hereto;
(b) Investments constituting (i) operating deposit accounts
with banks and (ii) accounts receivable arising in the ordinary course
of business on ordinary business terms that are not overdue;
(c) Permitted Investments (provided that any Permitted
Investment of the type described in clause (d) of the definition
thereof in Section 1.01 hereof that ceases to be rated "P-1" (or
higher) according to
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Moody's Investors Service, Inc. or "A-1" (or higher) according to
Standard and Poor's Corporation must be liquidated by the Company
within 60 days thereafter);
(d) Investments by the Company and its Subsidiaries in capital
stock of Subsidiaries of the Company to the extent outstanding on the
Closing Date and advances made after such date by the Company and its
Subsidiaries to Subsidiaries of the Company (other than Unrestricted
Subsidiaries and Released Guarantors) in the ordinary course of
business;
(e) Interest Rate Protection Agreements for an aggregate
notional amount not exceeding $300,000,000 at any one time;
(f) loans and advances to employees not to exceed $5,000,000
in the aggregate as to the Company and its Subsidiaries at any one time
outstanding;
(g) loans and advances by the Company and its Subsidiaries to
Unrestricted Subsidiaries and Released Guarantors so long as the
aggregate amount thereof at any one time outstanding shall not exceed
$100,000,000;
(h) Investments by Unrestricted Subsidiaries;
(i) Investments by Released Guarantors;
(j) in addition to Investments made in any Released Guarantor
prior to the time it became a Released Guarantor, additional
Investments by the Company and its Subsidiaries, so long as the
aggregate amount paid by the Company and its Subsidiaries for all such
Investments (whether in the form of cash or other consideration or in
the form of liabilities assumed), net of debt Investments that have
been repaid, does not exceed the sum of:
(i) $90,000,000, plus
(ii) for any period of four consecutive fiscal
quarters of the Company, the excess (if any) of (x) 50% of
Prior Year Excess Cash Flow for such period over (y) the sum
of (A) the aggregate amount of Dividend Payments made pursuant
to Section 9.09(b) hereof, to the extent paid in reliance on
Excess Cash Flow for such period as contemplated by clause (y)
thereof, plus (B) the amount of Capital Expenditures made by
the Company and its Subsidiaries pursuant to Section
9.11(a)(ii) hereof in such period;
provided that if (x) not later than five Business Days prior to any
Investment pursuant to this paragraph (i) where the aggregate amount of
such Investment (including liabilities assumed) exceeds $20,000,000,
the Company will deliver to the Agent in sufficient quantities for it
to deliver to the Lenders a certificate of a senior financial officer
of the Company to the effect that, after giving effect to such
Investment, the Company will be in compliance with Section 9.10 hereof,
such certificate to be in form and detail (including calculations)
reasonably satisfactory to the Administrative Agent;
(k) Equity Financed Investments; and
(l) Investments to the extent made in capital stock of the
Company.
9.09 Dividend Payments. The Company will not directly or indirectly,
through a Subsidiary or otherwise, declare or make any Dividend Payment at any
time; provided that the Company may declare and make Dividend Payments in cash:
(a) to any employee of the Company or any of its Subsidiaries
upon the termination of such employee's employment with the Company or
such Subsidiary; to the extent that (i) the aggregate amount
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of such Dividend Payments does not exceed $1,000,000 in any fiscal year
of the Company and (ii) on the date of any such Dividend Payment and
after giving effect thereto, no Default shall have occurred and be
continuing;
(b) so long as on the date of such Dividend Payment and after
giving effect thereto:
(i) no Default shall have occurred and be continuing;
and
(ii) the aggregate amount of Dividend Payments made
pursuant to this clause (b) shall not exceed the sum of the
following: (x) $80,000,000, plus (y) 50% of cumulative Excess
Cash Flow for the period commencing on February 2, 1997, minus
(z) the aggregate amount of Investments made pursuant to
Section 9.08(j)(ii) hereof and the aggregate amount of Capital
Expenditures made pursuant to Section 9.11(a)(ii) hereof; and
(c) in respect of any Preferred Stock so long as on the date
of any such Dividend Payment and after giving effect thereto, no
Default shall have occurred and be continuing.
9.10 Financial Covenants.
(a) Fixed Charge. The Company will not permit the Fixed Charge Ratio
for the last day of the fiscal quarter of the Company ending on or nearest to
October 31, 2000 to be less than 1.25 to 1.
(b) Interest Coverage Ratio. The Company will not permit the Interest
Coverage Ratio for the last day of any fiscal quarter of the Company ending on
or nearest to October 31, 2000 to be less than 1.50 to 1.
(c) Leverage Ratio. The Company will not permit the Leverage Ratio on
the last day of the fiscal quarter of the Company ending on or nearest to
October 31, 2000 to exceed the 2.25 to 1.
9.11 Capital Expenditures; Sale Lease-backs; Etc.
(a) Limit on Capital Expenditures. The Company will not permit the
aggregate amount of Capital Expenditures (other than Equity Financed Capital
Expenditures) in any fiscal year of the Company to exceed the sum of the
following:
(i) $270,000,000; plus
(ii) for any period of four consecutive fiscal quarters of the
Company, an additional amount not to exceed the excess (if any) of (x)
50% of Prior Year Excess Cash Flow for such period over (y) the sum of
(A) the aggregate amount of Dividend Payments made pursuant to Section
9.09(b) hereof, to the extent paid in reliance on Excess Cash Flow for
such period as contemplated by clause (y) thereof, plus (B) the amount
of Investments made by the Company and its Subsidiaries pursuant to
Section 9.08(j)(ii) hereof in such fiscal year.
For purposes of making determinations under this Section 9.11(a), any Capital
Expenditures shall be allocated first to Equity Financed Capital Expenditures
(to the extent permitted under the definition of "Equity Financed" in Section
1.01 hereof) and then to the maximum amount of Capital Expenditures permitted
under this Section 9.11(a).
(b) Specified Capital Expenditures. The Company shall not permit the
aggregate amount of expenditures with respect to Projects that have not yet been
made the subject of a Sale Lease-back to exceed $50,000,000 at any time.
9.12 Subordinated Indebtedness. Neither the Company nor any of its
Subsidiaries will defease, purchase, redeem, retire, exchange any securities for
or otherwise acquire for value, or set apart any money or obligations for a
sinking, defeasance or other analogous fund for, the purchase, redemption,
retirement or other acquisition of, or make any voluntary payment or prepayment
of the principal of or interest on, or any other amount owing in respect
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of, any Subordinated Debt, except for regularly scheduled payments of principal
and interest in respect thereof required to be made pursuant to the documents
governing such Subordinated Debt to the extent permitted to be made by the
subordination provisions thereof.
9.13 Lines of Business. The Company will not, and will not permit any
of its Subsidiaries to, engage in any line or lines of business activity other
than those engaged in by them on the Closing Date, any Related Businesses and
any other lines of business (in, or in connection with, any medium) related to,
or complementary with, the selling of books.
9.14 Transactions with Affiliates. Except as expressly permitted by
this Agreement, the Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly:
(a) make any Investment in an Affiliate of the Company or in
any of its Subsidiaries;
(b) transfer, sell, lease, assign or otherwise dispose of any
Property to any such Affiliate;
(c) merge into or consolidate with or purchase or acquire
Property from any such Affiliate; or
(d) enter into any other transaction directly or indirectly
with or for the benefit of any such Affiliate (including, without
limitation, Guarantees and assumptions of obligations of any such
Affiliate);
provided that (i) any Affiliate of the Company or any of its Subsidiaries who is
an individual may serve as a director, officer or employee of the Company or any
of its Subsidiaries and receive reasonable compensation for his or her services
in such capacity, (ii) the Company and its Subsidiaries may enter into
transactions (other than Investments by the Company or any of its Subsidiaries
in any Affiliate of the Company or any of its Subsidiaries) in the ordinary
course of business if the monetary or business consideration arising therefrom
would be substantially as advantageous to the Company and its Subsidiaries as
the monetary or business consideration which would obtain in a comparable
transaction with a Person not an Affiliate of the Company or any of its
Subsidiaries, (iii) Investments may be made in Affiliates to the extent
permitted under Section 9.08 hereof and (iv) any Unrestricted Subsidiary or
Released Guarantor may enter into any transaction with a Person not an Affiliate
of the Company.
9.15 Use of Proceeds. The Company will use the proceeds of the Loans
hereunder solely to finance Capital Expenditures permitted by Section 9.11
hereof, to acquire Related Businesses and make other Investments as contemplated
by Section 9.08 hereof and for general corporate purposes, including, without
limitation, in connection with the activities contemplated or permitted by this
Agreement to be undertaken by the Company and its Subsidiaries (in compliance
with all applicable legal and regulatory requirements); provided that neither
the Administrative Agent nor any Lender shall have any responsibility as to the
use of any of such proceeds.
9.16 Certain Obligations Respecting Subsidiaries.
(a) Subject to Section 9.05 hereof, the Company will, and will cause
each of its Subsidiaries (other than Unrestricted Subsidiaries and Released
Guarantors) to, take such action from time to time as shall be necessary to
ensure that each of its Subsidiaries (other than Unrestricted Subsidiaries and
Released Guarantors) is, except for any Permitted Management Ownership, a Wholly
Owned Subsidiary.
(b) Without limiting the generality of the foregoing (but subject to
Section 9.05 hereof), the Company will not, and will not permit any of its
Subsidiaries (other than any Unrestricted Subsidiary or Released Guarantor) to,
convey, sell, transfer or otherwise dispose of any shares of capital stock of
any Subsidiary (other than an Unrestricted Subsidiary or a Released Guarantor)
owned by them, nor permit any such Subsidiary (other than an Unrestricted
Subsidiary or a Released Guarantor) to issue any shares of capital stock of any
class whatsoever to any Person (other than to the Company or another Obligor),
except for any Permitted Management Ownership.
9.17 Additional Subsidiary Guarantors. In the event that the Company
shall, after the date hereof, hold or acquire any Subsidiary (other than an
Unrestricted Subsidiary or a Released Guarantor) that is not a Subsidiary
Guarantor hereunder, the Company will, and will cause each of its Subsidiaries
to, cause such Subsidiary (a) to
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execute and deliver a written instrument in form and substance satisfactory to
the Administrative Agent pursuant to which such Subsidiary shall become a
"Subsidiary Guarantor" and, thereby, an "Obligor" hereunder and (b) to deliver
such proof of corporate action, incumbency of officers, opinions of counsel and
other documents as is consistent with that delivered by each Obligor pursuant to
Section 7.01 hereof on the Closing Date or as the Majority Lenders or the
Administrative Agent shall have reasonably requested.
9.18 Modifications of License Agreement. The Company will not consent
to any modification, supplement or waiver of any of the provisions of the
License Agreement that would reasonably be expected to have a material adverse
effect on the interests of the Administrative Agent or the Lenders.
9.19 Sales of Accounts. At all times during which the Company is not
Investment Grade, the Company will not, and will not permit any of its
Subsidiaries (other than Unrestricted Subsidiaries and Released Guarantors) to,
sell with or without recourse, or discount or otherwise sell for less than the
face value thereof, any of their notes or accounts receivable (or any portion
thereof), except for compromises made in the ordinary course of business.
Section 10. Events of Default. If one or more of the following events
(herein called "Events of Default") shall occur and be continuing:
(a) The Company shall: (i) default in the payment of any
principal of any Loan when due (whether at stated maturity or upon
mandatory or optional prepayment); or (ii) default in the payment of
any interest on any Loan, any fee or any other amount payable by it
hereunder or under any other Basic Document when due and such default
shall have continued unremedied for three or more Business Days; or
(b) The Company or any of its Significant Subsidiaries shall
default in the payment when due of any principal of or interest on any
of its Indebtedness aggregating $25,000,000 or more (other than the
Indebtedness referred to in paragraph (a) above); or any event
specified in any note, agreement, indenture or other document
evidencing or relating to any such Indebtedness or any event specified
in any Interest Rate Protection Agreement shall occur if the effect of
such event is to cause, or (with the giving of any notice or the lapse
of time or both) to permit the holder or holders of such Indebtedness
(or a trustee or agent on behalf of such holder or holders) to cause,
such Indebtedness to become due, or to be prepaid in full (whether by
redemption, purchase, offer to purchase or otherwise), prior to its
stated maturity or to have the interest rate thereon reset to a level
so that securities evidencing such Indebtedness trade at a level
specified in relation to the par value thereof or, in the case of an
Interest Rate Protection Agreement, to permit the payments owing under
such Interest Rate Protection Agreement to be liquidated; or
(c) Any representation, warranty or certification made or
deemed made herein or in any other Basic Document (or in any
modification or supplement hereto or thereto) by any Obligor, or any
certificate furnished to any Lender or the Administrative Agent
pursuant to the provisions hereof or thereof, shall prove to have been
false or misleading as of the time made, deemed made or furnished in
any material respect, and (if such false or misleading representation
is reasonably likely to be capable of being promptly made to be no
longer false and misleading by actions of the Company) the same shall
continue unremedied for at least 30 days after any executive officer of
the Company knows or has reason to believe that such representation,
warranty or certification is false or misleading; or
(d) (i) The Company shall default in the performance of any of
its obligations under any of Sections 9.01(e), 9.03(a), 9.05, 9.06,
9.07, 9.08, 9.09, 9.10, 9.11, 9.12 or 9.14 hereof; or (ii) any Obligor
shall default in the performance of any of its other obligations in
this Agreement or any other Basic Document and such default (if
remediable) shall continue unremedied for a period of 30 days after
notice thereof to the Company by the Administrative Agent or any Lender
(through the Administrative Agent); or
(e) The Company or any of its Significant Subsidiaries shall
admit in writing its inability to, or be generally unable to, pay its
debts as such debts become due; or
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(f) The Company or any of its Significant Subsidiaries shall
(i) apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee, examiner or liquidator
of itself or of all or a substantial part of its Property, (ii) make a
general assignment for the benefit of its creditors, (iii) commence a
voluntary case under the Bankruptcy Code, (iv) file a petition seeking
to take advantage of any other law relating to bankruptcy, insolvency,
reorganization, liquidation, dissolution, arrangement or winding-up, or
composition or readjustment of its debts, (v) fail to controvert in a
timely and appropriate manner, or acquiesce in writing to, any petition
filed against it in an involuntary case under the Bankruptcy Code or
(vi) take any corporate action for the purpose of effecting any of the
foregoing; or
(g) A proceeding or case shall be commenced, without the
application or consent of the Company or any of its Significant
Subsidiaries, in any court of competent jurisdiction, seeking (i) its
reorganization, liquidation, dissolution, arrangement or winding-up, or
the composition or readjustment of its debts, (ii) the appointment of a
receiver, custodian, trustee, examiner, liquidator or the like of the
Company or such Significant Subsidiary or of all or any substantial
part of its Property, or (iii) similar relief in respect of the Company
or such Significant Subsidiary under any law relating to bankruptcy,
insolvency, reorganization, winding-up, or composition or adjustment of
debts, and such proceeding or case shall continue undismissed, or an
order, judgment or decree approving or ordering any of the foregoing
(other than an order for relief in an involuntary case under the
Bankruptcy Code) shall be entered and continue unstayed and in effect,
for a period of 60 or more days; or an order for relief against the
Company or such Significant Subsidiary shall be entered in an
involuntary case under the Bankruptcy Code; or
(h) A judgment or judgments for the payment of money in excess
of $25,000,000 in the aggregate (exclusive of judgment amounts to the
extent covered by insurance where the insurer has admitted liability in
respect of such judgment) shall be rendered by one or more courts,
administrative tribunals or other bodies having jurisdiction against
the Company or any of its Significant Subsidiaries and the same shall
not be discharged (or provision shall not be made for such discharge),
or a stay of execution thereof shall not be procured, within 45 days
from the date of entry thereof and the Company or the relevant
Significant Subsidiary shall not, within said period of 45 days, or
such longer period during which execution of the same shall have been
stayed, appeal therefrom and cause the execution thereof to be stayed
during such appeal; or
(i) An event or condition specified in Section 9.01(d) hereof
shall occur or exist with respect to any Plan or Multiemployer Plan
and, as a result of such event or condition, together with all other
such events or conditions, the Company or any ERISA Affiliate shall
incur a liability to a Plan, a Multiemployer Plan or PBGC (or any
combination of the foregoing) which has a Material Adverse Effect; or
(j) There shall have been asserted against the Company or any
of its Significant Subsidiaries claims or liabilities, whether accrued,
absolute or contingent, based on or arising from the generation,
storage, transport, handling or disposal of Hazardous Materials by the
Company or any of its Subsidiaries or Affiliates, or any predecessor in
interest of the Company or any of its Subsidiaries or Affiliates, or
relating to any site or facility owned, operated or leased by the
Company or any of its Subsidiaries or Affiliates, which claims or
liabilities (insofar as they are payable by the Company or any of its
Significant Subsidiaries but after deducting any portion thereof which
is reasonably expected to be paid by other Persons jointly and
severally liable therefor), in the judgment of the Majority Lenders are
reasonably likely to be determined adversely to the Company or any of
its Significant Subsidiaries, and the amount thereof is, either
individually or in the aggregate, reasonably likely to have a Material
Adverse Effect; or
(k) Any Change of Control shall occur;
THEREUPON: (1) in the case of an Event of Default other than one referred to in
paragraph (e), (f) or (g) of this Section 10 with respect to any Obligor, the
Administrative Agent may and, upon request of the Majority Lenders, shall, by
notice to the Company, terminate the Commitments and/or declare all or any
portion the principal amount then outstanding of, and the accrued interest on,
the Loans and all other amounts payable by the Obligors hereunder and under the
Notes (including, without limitation, any amounts payable under Section 5.05
hereof) to be forthwith due and payable, whereupon such amounts shall be
immediately due and payable without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by each
Obligor; and (2) in the
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case of the occurrence of an Event of Default referred to in paragraph (e), (f)
or (g) of this Section 10 with respect to any Obligor, the Commitments shall
automatically be terminated and the principal amount then outstanding of, and
the accrued interest on, the Loans and all other amounts payable by the Obligors
hereunder and under the Notes (including, without limitation, any amounts
payable under Section 5.05 hereof) shall automatically become immediately due
and payable without presentment, demand, protest or other formalities of any
kind, all of which are hereby expressly waived by each Obligor.
Section 11. The Administrative Agent.
11.01 Appointment, Powers and Immunities. Each Lender hereby
irrevocably (subject to Section 11.08 hereof) appoints and authorizes the
Administrative Agent to act as its agent hereunder and under the other Basic
Documents with such powers as are specifically delegated to the Administrative
Agent by the terms of this Agreement and of the other Basic Documents, together
with such other powers as are reasonably incidental thereto. The Administrative
Agent (which term as used in this sentence and in Section 11.05 and the first
sentence of Section 11.06 hereof shall include reference to its affiliates and
its own and its affiliates' officers, directors, employees and agents): (a)
shall have no duties or responsibilities except those expressly set forth in
this Agreement and in the other Basic Documents, and shall not by reason of this
Agreement or any other Basic Document be a trustee for any Lender; (b) shall not
be responsible to the Lenders for any recitals, statements, representations or
warranties contained in this Agreement or in any other Basic Document, or in any
certificate or other document referred to or provided for in, or received by any
of them under, this Agreement or any other Basic Document, or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement, any Note or any other Basic Document or any other document referred
to or provided for herein or therein or for any failure by the Company or any
other Person to perform any of its obligations hereunder or thereunder; (c)
shall not be required (except to the extent expressly required under Section
11.03 hereof) to initiate or conduct any litigation or collection proceedings
hereunder or under any other Basic Document; and (d) shall not be responsible
for any action taken or omitted to be taken by it hereunder or under any other
Basic Document or under any other document or instrument referred to or provided
for herein or therein or in connection herewith or therewith, except for its own
gross negligence or willful misconduct. The Administrative Agent may employ
agents and attorneys-in-fact and shall not be responsible for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it in good faith.
The Administrative Agent may deem and treat the payee of any Note as the holder
thereof for all purposes hereof unless and until a notice of the assignment or
transfer thereof shall have been filed with the Administrative Agent, together
with the consent of the Company to such assignment or transfer (to the extent
provided in Section 12.06(b) hereof).
11.02 Reliance by Administrative Agent. The Administrative Agent shall
be entitled to rely upon any certification, notice or other communication
(including, without limitation, any thereof by telephone, telecopy, telex,
telegram or cable) reasonably believed by it to be genuine and correct and to
have been signed or sent by or on behalf of the proper Person or Persons, and
upon advice and statements of legal counsel, independent accountants and other
experts selected by the Administrative Agent. As to any matters not expressly
provided for by this Agreement or any other Basic Document, the Administrative
Agent shall in all cases be fully protected in acting, or in refraining from
acting, hereunder or thereunder in accordance with instructions given by the
Majority Lenders, and such instructions of the Majority Lenders and any action
taken or failure to act pursuant thereto shall be binding on all of the Lenders.
11.03 Defaults. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default (other than the non-payment
of principal of or interest on Loans or of commitment fees) unless the
Administrative Agent has received notice from a Lender or the Company specifying
such Default and stating that such notice is a notice of default. In the event
that the Administrative Agent receives such a notice of the occurrence of a
Default, the Administrative Agent shall give prompt notice thereof to the
Lenders (and shall give each Lender prompt notice of each such non-payment). The
Administrative Agent shall (subject to Sections 11.07 and 12.04 hereof) take
such action with respect to such Default as shall be directed by the Majority
Lenders, provided that, unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default as it shall deem advisable in the best interest of the Lenders
except to the extent that this Agreement
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expressly requires that such action be taken, or not be taken, only with the
consent or upon the authorization of the Majority Lenders or all of the Lenders.
11.04 Rights as a Lender. With respect to its Commitments and the Loans
made by it, Chase (and any successor acting as Administrative Agent) in its
capacity as a Lender hereunder shall have the same rights and powers hereunder
as any other Lender and may exercise the same as though it were not acting as
the Administrative Agent, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Administrative Agent in its individual
capacity. Chase (and any successor acting as Administrative Agent) and its
affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in and generally engage in any
kind of banking, trust or other business with the Obligors (and any of their
Subsidiaries or Affiliates) as if it were not acting as the Administrative
Agent, and Chase and its affiliates may accept fees and other consideration from
the Obligors for services in connection with this Agreement or otherwise without
having to account for the same to the Lenders.
11.05 Indemnification. The Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed under Section 12.03 hereof,
but without limiting the obligations of the Company under said Section 12.03)
ratably in accordance with the aggregate principal amount of the Loans held by
the Lenders (or, if no Loans are at the time outstanding, ratably in accordance
with their respective Commitments), for any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever that may be imposed on, incurred
by or asserted against the Administrative Agent (including by any Lender)
arising out of or by reason of any investigation in or in any way relating to or
arising out of this Agreement or any other Basic Document or any other documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (including, without limitation, the costs and
expenses that the Company is obligated to pay under Section 12.03 hereof, but
excluding, unless a Default has occurred and is continuing, normal
administrative costs and expenses incident to the performance of its agency
duties hereunder) or the enforcement of any of the terms hereof or thereof or of
any such other documents, provided that no Lender shall be liable for any of the
foregoing to the extent they arise from the gross negligence or willful
misconduct of the party to be indemnified.
11.06 Non-Reliance on Administrative Agent and Other Lenders. Each
Lender agrees that it has, independently and without reliance on the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Company and its Subsidiaries and decision to enter into this Agreement and that
it will, independently and without reliance upon the Administrative Agent or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement. The Administrative Agent shall
not be required to keep itself informed as to the performance or observance by
any Obligor of this Agreement or any of the other Basic Documents or any other
document referred to or provided for herein or therein or to inspect the
Properties or books of the Company or any of its Subsidiaries. Except for
notices, reports and other documents and information expressly required to be
furnished to the Lenders by the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the affairs, financial
condition or business of the Company or any of its Subsidiaries (or any of their
affiliates) that may come into the possession of the Administrative Agent or any
of its affiliates.
11.07 Failure to Act. Except for action expressly required of the
Administrative Agent hereunder and under the other Basic Documents, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Lenders of their indemnification
obligations under Section 11.05 hereof against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take any such
action.
11.08 Resignation or Removal of Administrative Agent. Subject to the
appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving notice thereof
to the Lenders and the Company, and the Administrative Agent may be removed at
any time with or without cause by the Majority Lenders. Upon any such
resignation or removal, the Majority Lenders shall have the right (after
consultation with and, if no Default is then continuing, approval by, the
Company) to appoint a successor Administrative Agent; provided that such
successor Administrative Agent shall have total assets in excess of
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$50,000,000,000. If no successor Administrative Agent shall have been so
appointed by the Majority Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent's giving of notice of
resignation or the Majority Lenders' removal of the retiring Administrative
Agent, then the retiring Administrative Agent may, on behalf of the Lenders,
appoint a successor Administrative Agent, that shall be a bank that has an
office in New York, New York and shall have total assets in excess of
$50,000,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. After any retiring Administrative Agent's resignation or removal
hereunder as Administrative Agent, the provisions of this Section 11 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Administrative Agent.
Section 12. Miscellaneous.
12.01 Waiver. No failure on the part of the Administrative Agent or any
Lender to exercise and no delay in exercising, and no course of dealing with
respect to, any right, power or privilege under this Agreement or any Note shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, power or privilege under this Agreement or any Note preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
12.02 Notices. All notices, requests and other communications provided
for herein (including, without limitation, any modifications of, or waivers,
requests or consents under, this Agreement) shall be given or made in writing
(including, without limitation, by telex or telecopy) delivered to the intended
recipient at the "Address for Notices" specified below its name on the signature
pages hereof (below the name of the Company, in the case of any Subsidiary
Guarantor); or, as to any party, at such other address as shall be designated by
such party in a notice to each other party. Except as otherwise provided in this
Agreement, all such communications shall be deemed to have been duly given when
transmitted by telex or telecopier or personally delivered by hand or overnight
courier or, in the case of a notice sent by first class certified mail, postage
prepaid, three days after mailing in each case given or addressed as aforesaid.
12.03 Expenses, Etc. The Company agrees to pay or reimburse each of the
Lenders and the Administrative Agent for paying: (a) all reasonable
out-of-pocket costs and expenses of the Administrative Agent (including, without
limitation, the reasonable fees and expenses of Mayer, Brown & Platt, special
New York counsel to Chase), in connection with (i) the negotiation, preparation,
execution and delivery of this Agreement and the other Basic Documents and the
extensions of credit hereunder, and (ii) any modification, supplement or waiver
of any of the terms of this Agreement or any of the other Basic Documents; (b)
all costs and expenses of the Lenders and the Administrative Agent (including,
without limitation, reasonable counsels' fees) in connection with (i) any
Default, any waiver whatsoever thereof, and any enforcement or collection
proceedings resulting therefrom or in connection with the negotiation of any
restructuring or "work-out" (whether or not consummated) of the obligations of
the Company hereunder or under any of the other Basic Documents and (ii) the
enforcement of this Section 12.03; and (c) all transfer, stamp, documentary or
other similar taxes, assessments or charges levied by any governmental or
revenue authority in respect of this Agreement or any of the other Basic
Documents or any other document referred to herein or therein.
The Company hereby agrees to indemnify the Administrative Agent and
each Lender and their respective directors, officers, employees, attorneys and
agents from, and hold each of them harmless against, any and all losses,
liabilities, claims, damages or expenses incurred by any of them (including,
without limitation, any and all losses, liabilities, claims, damages or expenses
incurred by the Administrative Agent to any Lender, whether or not the
Administrative Agent or any Lender is a party thereto but excluding costs or
expenses incurred in connection with negotiating, documenting or effecting any
assignment or participation made pursuant to Section 12.06 hereof) arising out
of or by reason of any investigation or litigation or other proceedings
(including any threatened investigation or litigation or other proceedings)
relating to the extensions of credit hereunder or any actual or proposed use by
the Company or any of its Subsidiaries of the proceeds of any of the extensions
of credit hereunder, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such
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investigation or litigation or other proceedings (but excluding any such losses,
liabilities, claims, damages or expenses incurred by reason of the gross
negligence or willful misconduct of the Person to be indemnified), and each
Obligor party hereto hereby agrees not to assert any claim against the
Administrative Agent, any Lender, any of their affiliates or any of their
respective directors, officers, employees, attorneys and agents, on any theory
of liability, for special, indirect, consequential or punitive damages arising
out of or otherwise relating to any of the transactions contemplated herein or
in any other Basic Document. Without limiting the generality of the foregoing,
the Company will indemnify the Administrative Agent and each Lender from, and
hold the Administrative Agent and each Lender harmless against, any losses,
liabilities, claims, damages or expenses described in the preceding sentence
(but excluding, as provided in the preceding sentence, any loss, liability,
claim, damage or expense incurred by reason of the gross negligence or willful
misconduct of the Person to be indemnified) arising under any Environmental Law
as a result of the past, present or future operations of the Company or any of
its Subsidiaries (or any predecessor in interest to the Company or any of its
Subsidiaries), or the past, present or future condition of any site or facility
owned, operated or leased by the Company or any of its Subsidiaries (or any such
predecessor in interest), or any Release or threatened Release of any Hazardous
Materials from any such site or facility, including any such Release or
threatened Release which shall occur during any period when the Administrative
Agent or any Lender shall be in possession of any such site or facility
following the exercise by the Administrative Agent or any Lender of any of its
rights and remedies hereunder unless such Release is solely the direct result of
avoidable conduct on the part of the Administrative Agent or such Lender.
12.04 Amendments, Etc. Except as otherwise expressly provided in this
Agreement, any provision of this Agreement may be modified or supplemented only
by an instrument in writing signed by the Company, the Administrative Agent and
the Majority Lenders, or by the Company and the Administrative Agent acting with
the consent of the Majority Lenders, and any provision of this Agreement may be
waived by the Majority Lenders or by the Administrative Agent acting with the
consent of the Majority Lenders; provided that:
(a) no modification, supplement or waiver shall, unless by an
instrument signed by all of the Lenders or by the Administrative Agent
acting with the consent of all of the Lenders (i) increase or extend
the term of the Commitments, or extend the time or waive any
requirement for the reduction or termination of the Commitments, (ii)
extend any date fixed for the payment of principal of or interest on
any Loan or any fee hereunder (other than any fee payable solely for
account of the Administrative Agent), (iii) reduce the amount of any
such payment of principal, (iv) reduce the rate at which interest is
payable thereon or any fee is payable hereunder (other than any fee
payable solely for account of the Administrative Agent), (v) increase
the rights or reduce the obligations of the Company to prepay Loans,
(vi) alter the terms of any of Sections 4.02 and 4.07 hereof or this
Section 12.04, (vii) modify the definitions of the terms "Majority
Lenders" or modify in any other manner the number or percentage of the
Lenders required to make any determinations or waive any rights
hereunder or to modify any provision hereof, (viii) waive any of the
conditions precedent set forth in Section 7 hereof, (ix) release any
Subsidiary Guarantor from any of its obligations under Section 6 hereof
(except as provided in Section 6.09 hereof) or (x) permit any Obligor
to sell all or substantially all of its Property (except as expressly
provided in this Agreement); and
(b) any modification of any of the rights or obligations of
the Administrative Agent hereunder shall require the consent of the
Administrative Agent.
12.05 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
12.06 Assignments and Participations.
(a) No Obligor may assign any of its rights or obligations hereunder or
under the Notes without the prior consent of all of the Lenders and the
Administrative Agent.
(b) Each Lender may, at any time or from time to time, assign to one or
more other Eligible Assignees or other Lenders all or any portion of its Loans,
its Note, and its Commitment (but only with the consent of the Company and the
Administrative Agent (which consents shall not be unreasonably withheld or
delayed)); provided that (i) no such consent by the Company shall be required if
any Event of Default shall have occurred and be continuing at the time of such
assignment; (ii) any such partial assignment (other than any such assignment to
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another Lender) shall be in an amount at least equal to $5,000,000 and, after
giving effect thereto, the assignor shall have a Commitment at least equal to
$5,000,000; and (iii) each such assignment shall be made in such manner so that
the same portion of the assigning Lender's Loans, Note and Commitment is
assigned to the respective assignee. Upon execution and delivery by the assignee
to the Company and the Administrative Agent of an instrument in writing pursuant
to which such assignee agrees to become a "Lender" hereunder (if not already a
Lender) having the Commitments and Loans specified in such instrument, and upon
consent thereto by the Company, the Administrative Agent, to the extent required
above, the assignee shall have, to the extent of such assignment (unless
otherwise provided in such assignment with the consent of the Company and the
Administrative Agent), the obligations, rights and benefits of a Lender
hereunder holding the Commitments and Loans (or portions thereof) assigned to it
(in addition to the Commitments and Loans, if any, theretofore held by such
assignee) and the assigning Lender shall, to the extent of such assignment, be
released from the Commitments (or portion thereof) so assigned. Upon each such
assignment the assigning Lender shall pay the Administrative Agent an assignment
fee of $3,500.
(c) A Lender may, at any time or from time to time, sell or agree to
sell to one or more other Persons a participation in all or any part of any
Loans held by it, or in its Commitments, in which event each purchaser of a
participation (a "Participant") shall be entitled to the rights and benefits of
the provisions of Sections 9.01(f), 5.05, 5.06 and 12.03 hereof with respect to
its participation in such Loans and Commitments as if (and the Company shall be
directly obligated to such Participant under such provisions as if) such
Participant were a "Lender" for purposes of said Section, but, except for the
rights of the Lenders under Section 4.06(c) hereof, shall not have any other
rights or benefits under this Agreement or any Note or any other Basic Document
(the Participant's rights against such Lender in respect of such participation
to be those set forth in the agreements executed by such Lender in favor of the
Participant). All amounts payable by the Company to any Lender under Section 5
hereof in respect of the Loans held by it, and its Commitments, shall be
determined as if such Lender had not sold or agreed to sell any participations
in such Loans and Commitments, and as if such Lender were funding each of such
Loan and Commitments in the same way that it is funding the portion of such Loan
and Commitments in which no participations have been sold. In no event shall a
Lender that sells a participation agree with the Participant to take or refrain
from taking any action hereunder or under any other Basic Document except that
such Lender may agree with the Participant that such Lender will not, without
the consent of the Participant, agree to (i) increase or extend the term, or
extend the time or waive any requirement for the reduction or termination, of
such Lender's Commitments, (ii) extend any date fixed for the payment of
principal of or interest on the related Loan or Loans or any portion of any fee
hereunder payable to the Participant, (iii) reduce the amount of any such
payment of principal, (iv) reduce the rate at which interest is payable thereon,
or any fee hereunder payable to the Participant, to a level below the rate at
which the Participant is entitled to receive such interest or fee, (v) increase
the rights or reduce the obligations of the Company to prepay the related Loans
or (vi) consent to any modification, supplement or waiver of this Agreement or
any of the other Basic Documents to the extent that the same, under Section
12.04 hereof, requires the consent of each Lender.
(d) In addition to the assignments and participations permitted by the
foregoing provisions of this Section 12.06, any Lender may assign and pledge all
or any portion of its Loans and its Note to any Federal Reserve Bank as
collateral security pursuant to Regulation A and any Operating Circular issued
by such Federal Reserve Bank, and such Loans and Note shall be fully
transferrable as provided therein. No such assignment shall release the
assigning Lender from its obligations hereunder.
(e) A Lender may furnish any information concerning the Company or any
of its Subsidiaries in the possession of such Lender from time to time to
assignees and participants (including prospective assignees and participants),
subject, however, to the provisions of Section 12.13 hereof.
(f) Anything in this Section 12.06 to the contrary notwithstanding,
neither the Company nor any of its Subsidiaries or Affiliates may acquire
(whether by assignment, participation or otherwise), and no Lender shall assign
or participate to the Company or any of its Subsidiaries or Affiliates, any
interest in any Commitments or Loan without the prior consent of each Lender.
12.07 Survival. The obligations of the Company under Sections 5.01,
5.05, 5.06 and 12.03 hereof, the obligations of each Subsidiary Guarantor under
Section 6.03 hereof, and the obligations of the Lenders under Section 11.05 and
Section 12.13 hereof shall survive the repayment of the Loans and the
termination of the
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<PAGE> 49
Commitments for a period of two years (provided that any claim or demand made by
the Administrative Agent or any Lender with respect to any such obligation prior
to the end of such two-year period shall survive the expiration of such period).
In addition, each representation and warranty made, or deemed to be made by a
notice of any Loan, herein or pursuant hereto shall survive the making of such
representation and warranty for a period of two years (provided that any claim
or demand made by the Administrative Agent or any Lender with respect to any
such representation or warranty prior to the end of such two-year period shall
survive the expiration of such period), and no Lender shall be deemed to have
waived, by reason of making any Loan, any Default which may arise by reason of
such representation or warranty proving to have been false or misleading,
notwithstanding that such Lender or the Administrative Agent may have had notice
or knowledge or reason to believe that such representation or warranty was false
or misleading at the time such Loan was made.
12.08 Captions. The table of contents and captions and section headings
appearing herein are included solely for convenience of reference and are not
intended to affect the interpretation of any provision of this Agreement.
12.09 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
12.10 Governing Law; Submission to Jurisdiction. This Agreement and the
Notes shall be governed by, and construed in accordance with, the law of the
State of New York. Each Obligor hereby submits to the nonexclusive jurisdiction
of the United States District Court for the Southern District of New York and of
any New York state court sitting in New York City for the purposes of all legal
proceedings arising out of or relating to this Agreement or the transactions
contemplated hereby. Each Obligor irrevocably waives, to the fullest extent
permitted by applicable law, any objection which it may now or hereafter have to
the laying of the venue of any such proceeding brought in such a court and any
claim that any such proceeding brought in such a court has been brought in an
inconvenient forum.
12.11 Waiver of Jury Trial. EACH OF THE OBLIGORS, THE ADMINISTRATIVE
AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
12.12 Complete Agreement. This Agreement and the other Basic Documents
contain the entire and exclusive agreement of the parties hereto with reference
to the matters discussed herein or therein. This Agreement and the other Basic
Documents supersede all prior drafts and communications with respect thereto.
12.13 Confidentiality. Each Lender and the Administrative Agent agrees
(on behalf of itself and each of its affiliates, directors, officers, employees
and representatives) to use such precautions as it uses to maintain the
confidentiality of its own confidential information, and in accordance with safe
and sound banking practices, any information supplied to it by the Company or
any of its Subsidiaries pursuant to this Agreement that is not publicly
available, provided that nothing herein shall limit the disclosure of any such
information (i) to the extent required by statute, rule, regulation or judicial
process, (ii) to counsel for any of the Lenders or the Administrative Agent,
(iii) to bank examiners, auditors or accountants, (iv) to the Administrative
Agent or any other Lender, (v) in connection with any litigation to which any
one or more of the Lenders or the Administrative Agent is a party, (vi) to a
subsidiary or affiliate of such Lender or (vii) to any assignee or participant
(or prospective assignee or participant) so long as such assignee or participant
(or prospective assignee or participant) first executes and delivers to the
respective Lender and the Company a confidentiality agreement in a form
reasonably acceptable to the Company and such Lender.
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<PAGE> 50
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
BARNES & NOBLE, INC.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
Address for Notices:
122 Fifth Avenue
New York, New York 10011
Attention: Chief Financial Officer
Telecopier No.: (212) 675-0413
Telephone No.: (212) 633-3300
With a copy to:
Robinson Silverman Pearce Aronsohn
& Berman LLP
1290 Avenue of the Americas
New York, New York 10104
Attention: Michael N. Rosen, Esq.
Telecopier No.: (212) 541-4630
Telephone No.: (212) 541-2200
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<PAGE> 51
SUBSIDIARY GUARANTORS
B. DALTON BOOKSELLER, INC.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
BABBAGE'S ETC. LLC
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
BARNES & NOBLE BOOKSELLERS, INC.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
CCI HOLDINGS, INC.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
DOUBLEDAY BOOK SHOPS, INC.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
FUNCO, INC.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
MABO CORP.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
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<PAGE> 52
SUNRISE PUBLICATIONS, INC.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
VENDAMERICA, INC.
By /s/Maureen O'Connell
----------------------------------------
Title: Chief Financial Officer
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<PAGE> 53
THE CHASE MANHATTAN BANK
as Administrative Agent
By /s/Barry K. Bergman
----------------------------------------
Name: Barry K. Bergman
Title: Vice President
Address for Notices to Administrative Agent:
270 Park Avenue
New York, NY 10017
Attention: Barry K. Bergman
Telecopier: (212) 270-1063
Telephone: (212) 270-0203
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<PAGE> 54
LENDERS
Commitment THE CHASE MANHATTAN BANK
$16,000,000.00
By /s/ Barry K. Bergman
----------------------------------------
Name: Barry K. Bergman
Title: Vice President
Address:
270 Park Avenue
New York, NY 10017
Attention: Barry K. Bergman
Telecopier: (212) 270-1063
Telephone: (212) 270-0203
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<PAGE> 55
Commitment ALLFIRST BANK
$7,000,000.00
By /s/Stewart T. Shettle
----------------------------------------
Name: Stewart T. Shettle
Title: Vice President
Address:
25 South Charles Street
Mail Code 101 745
Baltimore, MD 21201
Attention: Stewart Shettle
Telecopier: 410-545-2047
Telephone: 410-244-4104
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<PAGE> 56
Commitment THE BANK OF NEW YORK
$7,000,000.00
By /s/Howard F. Bascom, Jr.
----------------------------------------
Name: Howard F. Bascom, Jr.
Title: Vice President
Address:
1 Wall Street
New York, NY 10286
Attention: Lucille Cuttone
Telecopier: 212-635-1483
Telephone: 212-635-7879
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<PAGE> 57
Commitment THE BANK OF NOVA SCOTIA
$7,000,000.00
By /s/J. Alan Edwards
----------------------------------------
Name: J. Alan Edwards
Title: Managing Director
Address:
One Liberty Plaza
New York, NY 10006
Attention: Meredith Wedeking
Telecopier: 212-225-5090
Telephone: 212-225-5017
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<PAGE> 58
Commitment FIFTH THIRD BANK
$7,000,000.00
By /s/Ann Pierson
----------------------------------------
Name: Ann Pierson
Title: Corporate Banking Officer
Address:
38 Fountain Square Plaza
Cincinnati, OH 45263
Attention: Ann Pierson
Telecopier: 513-744-5947
Telephone: 513-579-5295
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<PAGE> 59
Commitment FIRSTAR CORPORATION
$7,000,000.00
By /s/Stephen M. Reese
----------------------------------------
Name: Stephen M. Reese
Title: Senior Vice President
Address:
Seventh & Washington
12th Floor
St Louis, MO 63101
Attention: Tom Bayer
Telecopier: 314-418-1963
Telephone: 314-418-3993
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<PAGE> 60
Commitment FLEET NATIONAL BANK
$7,000,000.00
By /s/Alexis Griffin
----------------------------------------
Name: Alexis Griffin
Title: Assistant Vice President
Address:
100 Federal Street
MA DE 10008E
Boston, MA 02110
Attention: Thomas Bullard
Telecopier: 617-434-6685
Telephone: 617-434-3824
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<PAGE> 61
Commitment FUJI BANK, LIMITED
$7,000,000.00
By /s/Nobuoki Koike
----------------------------------------
Name: Nobuoki Koike
Title: Vice President & Senior Team Leader
Address:
Two World Trade Center
79th Floor
New York, NY 10048
Attention: Ajay Nanda
Telecopier: 212-898-2399
Telephone: 212-898-2694
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<PAGE> 62
Commitment IBJ WHITEHALL BANK & TRUST CO.
$7,000,000.00
By /s/Mark H. Minter
----------------------------------------
Name: Mark H. Minter
Title: Senior Managing Director
Address:
One State Street
New York, NY 10004
Attention: John Doyle
Telecopier: 212-858-2768
Telephone: 212-858-2507
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<PAGE> 63
Commitment MELLON BANK, N.A.
$7,000,000.00
By /s/Charles H. Staub
----------------------------------------
Name: Charles H. Staub
Title: Senior Vice President
Address:
One Mellon Bank Center
Room 0370
Pittsburgh, PA 15258-0001
Attention: Richard J. Schaich
Telecopier: 412-236-1914
Telephone: 412-234-4420
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<PAGE> 64
Commitment SUMITOMO BANK, LIMITED
$7,000,000.00
By /s/P. R. C. Knight
----------------------------------------
Name: P. R. C. Knight
Title: Senior Vice President
Address:
277 Park Avenue
New York, NY 10172
Attention: Bruce Gregory
Telecopier: 212-224-4384
Telephone: 212-224-4143
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<PAGE> 65
Commitment SUMMIT BANK
$7,000,000.00
By /s/Miguel J. Medida
----------------------------------------
Name: Miguel J. Medida
Title: Vice President & Director
Address:
502 Carnegie Center
Princeton, NJ 08543
Attention: Miguel J. Medida
Telecopier: 609-799-9262
Telephone: 609-627-7882
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Commitment SUNTRUST BANK
$7,000,000.00
By /s/W. David Wisdom
----------------------------------------
Name: W. David Wisdom
Title: Vice President
Address:
711 Fifth Avenue
16th Floor
New York, NY 10022
Attention: Keith A. Hubbard
Telecopier: 212-371-9386
Telephone: 212-583-2612
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