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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities and Exchange Act of 1934
(Amendment No. 2)*
Livent Inc.
(Name of Issuer)
Common Shares
(Title of Class of Securities)
537902108
(CUSIP Number)
Robert Adler, Esq.
Munger, Tolles & Olson LLP
355 So. Grand Avenue
Los Angeles, CA 90071
(213) 683-9100
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
November 18, 1998
(Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box [ ].
Check the following box if a fee is being paid with the statement [ ]. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such
class.) (See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are
to be sent.
*The remainder of this cover page shall be filed out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section
of the Act but shall be subject to all other provisions of the Act (however,
see the Notes).
(Continued on following page(s))
Page 1 of ___ Pages
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CUSIP No. 537902108 13D Page __ of __ Pages
1 Name of Reporting Person: Lynx Ventures L.P.
S.S. or I.R.S. Identification No. of above person:
2 Check the appropriate box if a member of a Group*:
(a) [ ]
(b) [x]
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3 SEC USE ONLY
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4 Source of Funds: WC
5 Check box if disclosure of legal proceedings
is required pursuant to items 2(d) or (e) [ ]
6 Citizen or place of organization: Delaware
7 Number of shares beneficially owned by each Reporting Person
with Sole Voting Power: 0
8 Number of shares beneficially owned by each Reporting Person
with Shared Voting Power: 5,970,000 (see Item 5)
9 Number of shares beneficially owned by each Reporting Person
with Sole Dispositive Power: 0
10 Number of shares beneficially owned by each Reporting Person
with Shared Dispositive Power: 5,970,000 (see Item 5)
11 Aggregate amount beneficially owned by each Reporting Person:
5,970,000 (see Item 5)
12 Check Box if the aggregate amount in row (11) excludes
certain shares [ ]
13 Percent of class represented by amount in row (11):26.8%
14 Type of Reporting Person*: PN
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SCHEDULE 13D
CUSIP No. 537902108 13D Page __ of __ Pages
1 Name of Reporting Person: Lynx Ventures L.L.C.
S.S. or I.R.S. Identification No. of above person:
2 Check the appropriate box if a member of a Group*:
(a) [ ]
(b) [x]
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3 SEC USE ONLY
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4 Source of Funds: WC
5 Check box if disclosure of legal proceedings
is required pursuant to items 2(d) or (e) [ ]
6 Citizen or place of organization: Delaware
7 Number of shares beneficially owned by each Reporting Person
with Sole Voting Power: 0
8 Number of shares beneficially owned by each Reporting Person
with Shared Voting Power: 5,970,000 (see Item 5)
9 Number of shares beneficially owned by each Reporting Person
with Sole Dispositive Power: 0
10 Number of shares beneficially owned by each Reporting Person
with Shared Dispositive Power: 5,970,000 (see Item 5)
11 Aggregate amount beneficially owned by each Reporting Person:
5,970,000 (see Item 5)
12 Check Box if the aggregate amount in row (11) excludes
certain shares [ ]
13 Percent of class represented by amount in row (11):26.8%
14 Type of Reporting Person*: 00
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SCHEDULE 13D
CUSIP No. 537902108 13D Page __ of __ Pages
1 Name of Reporting Person: The Ovitz Family Limited Partnership
S.S. or I.R.S. Identification No. of above person: 95-4547742
2 Check the appropriate box if a member of a Group*:
(a) [ ]
(b) [x]
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3 SEC USE ONLY
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4 Source of Funds: N/A
5 Check box if disclosure of legal proceedings is required
pursuant to items 2(d) or (e) [ ]
6 Citizen or place of organization: Delaware
7 Number of shares beneficially owned by each Reporting Person
with Sole Voting Power: 990,000 (see Item 5)
8 Number of shares beneficially owned by each Reporting Person
with Shared Voting Power: 0
9 Number of shares beneficially owned by each Reporting Person
with Sole Dispositive Power: 990,000 (see Item 5)
10 Number of shares beneficially owned by each Reporting Person
with Shared Dispositive Power: 0
11 Aggregate amount beneficially owned by each Reporting Person:
990,000 (see Item 5)
12 Check Box if the aggregate amount in row (11) excludes certain
shares [ ]
13 Percent of class represented by amount in row (11):4.5%
14 Type of Reporting Person*: PN
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SCHEDULE 13D
CUSIP No. 537902108 13D Page __ of __ Pages
1 Name of Reporting Person: The Michael and Judy Ovitz Revocable
Trust
S.S. or I.R.S. Identification No. of above person: 04-3159375
2 Check the appropriate box if a member of a Group*:
(a) [ ]
(b) [x]
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3 SEC USE ONLY
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4 Source of Funds: BK
5 Check box if disclosure of legal proceedings is required
pursuant to items 2(d) or (e) [ ]
6 Citizen or place of organization:
7 Number of shares beneficially owned by each Reporting Person
with Sole Voting Power: 0
8 Number of shares beneficially owned by each Reporting Person
with Shared Voting Power: 990,000 (see Item 5)
9 Number of shares beneficially owned by each Reporting Person
with Sole Dispositive Power: 0
10 Number of shares beneficially owned by each Reporting Person
with Shared Dispositive Power: 990,000 (see Item 5)
11 Aggregate amount beneficially owned by each Reporting Person:
990,000 (see Item 5)
12 Check Box if the aggregate amount in row (11) excludes
certain shares [ ]
13 Percent of class represented by amount in row (11):4.5%
14 Type of Reporting Person*: 00
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SCHEDULE 13D
CUSIP No. 537902108 13D Page __ of __ Pages
1 Name of Reporting Person: Michael S. Ovitz
S.S. or I.R.S. Identification No. of above person:
2 Check the appropriate box if a member of a Group*:
(a) [ ]
(b) [x]
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3 SEC USE ONLY
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4 Source of Funds: N/A
5 Check box if disclosure of legal proceedings is required
pursuant to items 2(d) or (e) [ ]
6 Citizen or place of organization: United States
7 Number of shares beneficially owned by each Reporting Person
with Sole Voting Power: 0
8 Number of shares beneficially owned by each Reporting Person
with Shared Voting Power: 6,960,000 (see Item 5)
9 Number of shares beneficially owned by each Reporting Person
with Sole Dispositive Power: 0
10 Number of shares beneficially owned by each Reporting Person
with Shared Dispositive Power: 6,960,000 (see Item 5)
11 Aggregate amount beneficially owned by each Reporting Person:
6,960,000 (see Item 5)
12 Check Box if the aggregate amount in row (11) excludes
certain shares [ ]
13 Percent of class represented by amount in row (11):29.9%
14 Type of Reporting Person*: IN
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SCHEDULE 13D
CUSIP No. 537902108 13D Page __ of __ Pages
1 Name of Reporting Person: Roy L. Furman
S.S. or I.R.S. Identification No. of above person:
2 Check the appropriate box if a member of a Group*:
(a) [ ]
(b) [x]
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3 SEC USE ONLY
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4 Source of Funds: PF, 00
5 Check box if disclosure of legal proceedings
is required pursuant to items 2(d) or (e) [ ]
6 Citizen or place of organization: United States
7 Number of shares beneficially owned by each Reporting Person
with Sole Voting Power: 0
8 Number of shares beneficially owned by each Reporting Person
with Shared Voting Power: 1,535,000 (see Item 5)
9 Number of shares beneficially owned by each Reporting Person
with Sole Dispositive Power: 0
10 Number of shares beneficially owned by each Reporting Person
with Shared Dispositive Power: 1,535,000 (see Item 5)
11 Aggregate amount beneficially owned by each Reporting Person:
1,535,000 (see Item 5)
12 Check Box if the aggregate amount in row (11) excludes
certain shares [ ]
13 Percent of class represented by amount in row (11):7.0%
14 Type of Reporting Person*: IN
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SCHEDULE 13D
CUSIP No. 537902108 13D Page __ of __ Pages
1 Name of Reporting Person: David R. Maisel
S.S. or I.R.S. Identification No. of above person:
2 Check the appropriate box if a member of a Group*:
(a) [ ]
(b) [x]
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3 SEC USE ONLY
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4 Source of Funds: NA
5 Check box if disclosure of legal proceedings is required
pursuant to items 2(d) or (e) [ ]
6 Citizen or place of organization: United States
7 Number of shares beneficially owned by each Reporting Person
with Sole Voting Power: 0
8 Number of shares beneficially owned by each Reporting Person
with Shared Voting Power: 400,000 (see Item 5)
9 Number of shares beneficially owned by each Reporting Person
with Sole Dispositive Power: 0
10 Number of shares beneficially owned by each Reporting Person
with Shared Dispositive Power: 400,000 (see Item 5)
11 Aggregate amount beneficially owned by each Reporting Person:
400,000 (see Item 5)
12 Check Box if the aggregate amount in row (11) excludes
certain shares [ ]
13 Percent of class represented by amount in row (11):1.9%
14 Type of Reporting Person*: IN
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SCHEDULE 13D
Amendment No. 2 to Schedule 13D
This Amendment No. 2 hereby amends and supplements the Statement on
Schedule 13D, as amended by Amendment No. 1, relating to the common shares,
without par value (the "Shares") of Livent Inc., an Ontario corporation (the
"Company"), as previously filed by the Reporting Persons, consisting of Lynx
Ventures L.P., Lynx Ventures L.L.C., The Ovitz Family Limited Partnership,
the Michael and Judy Ovitz Revocable Trust, Michael S. Ovitz, Roy L. Furman
and David R. Maisel. Capitalized terms used herein without definition have
the meaning ascribed to such terms in the Schedule 13D.
Item. 3. Source and Amount of Funds or Other Consideration.
Item 3 is hereby amended as follows:
Paragraph three of Item 3 is deleted and replaced with the following:
Lynx Ventures L.P. acquired the funds to make the purchases described
herein through a capital contribution of its general partner, Lynx Ventures
L.L.C., of which Mr. Ovitz is the Managing Member. Mr. Ovitz, in his capacity
as trustee of the Michael Ovitz and Judy Ovitz Revocable Trust, obtained the
funds from a personal line of credit which is attached as Exhibit 18. Furman
obtained funds from his personal accounts to make the purchases described
herein, a portion of which was drawn from a margin account maintained in the
ordinary course with a brokerage firm.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
to Securities of the Issuer.
Item 6 is hereby amended to include the following:
On November 18, 1998, certain directors of Livent, Inc. (the "Parent")
entered into secured loan agreements (the "DIP Loans") with Livent Realty
(New York) Inc. ("Livent NY") and Livent Realty (Chicago) Inc. ("Livent
Chicago" and, together with Livent NY, the "Borrowers") and the Parent and
Livent (U.S.) Inc. ("Livent US" and, together with the Parent, the
"Guarantors") in order to finance the working capital and general corporate
requirements of the Borrowers and Guarantors during the initial period
following the Borrowers' and Guarantors' filings under Chapter 11 of the
Bankruptcy Act, Title 11 of the United States Code (the "Bankruptcy Code").
As part of these transactions, Lynx Ventures L.P. ("Lynx") provided one
million United States dollars ($1,000,000) and Roy L. Furman ("Furman")
provided three hundred thousand United States dollars ($300,000), to the
Borrowers as debtors and debtors-in-possession in the cases pending under the
Bankruptcy Code (the "Cases").
The Borrowers have agreed to repay each lender under the DIP Loans on
the earliest of (i) May 19, 2000; (ii) the effective date of a plan of
reorganization or liquidation in the Cases or (iii) the date of substantial
consummation of a plan or reorganization in the Cases. The Borrowers must pay
interest monthly on the unpaid principal amount of the DIP Loan until that
amount is paid in full at a rate equal to the prime commercial lending rate
announced by The Chase Manhattan Bank plus two percent (2%). Upon the
occurrence and continuance of any default in the payment of any principal,
interest or costs, the DIP Loans will bear interest at an annual rate equal
to the rate which is two percent (2%) in excess of the rate then borne by the
DIP Loans. Such interest is payable on demand.
The Borrowers must repay the unpaid principal amount of the DIP Loans,
all accrued and unpaid interest thereon and reasonable costs upon (i) the
funding of a subsequent debtor-in-possession facility in the Cases by an
entity other than the director lenders under the DIP Loans and (ii) the sale
of all assets securing the DIP Loans (the "Security").
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In the event of a sale of less than all of the Security, the net proceeds of
such sale are to be paid in respect of the DIP Loans on a PRO RATA basis.
The Obligations are secured by security interests and mortgages in the
Ford Center for the Performing Arts in New York City and the Ford Center for
the Performing Arts in Chicago, Illinois (the "DIP Liens"). The DIP Liens are
subordinate to senior security interests of record, if any. The DIP Liens are
further subject to the actual existence of the property liens referred to in
the agreements therefor, if any; and to post-default claims of (a) $300,000
for customary and usual professional fees, and (b) fees of the United States
Trustee.
On November 27, 1998, the Company announced its receipt of a commitment
from a third party financier to provide debtor-in-possession financing
("Third Party DIP Financing") subject to a number of conditions, including
pertinent approvals of the bankruptcy court. Under the terms of such
commitment, up to $5.5 million of funds to be provided by the third party may
be applied to repayment of the DIP Loans. To the extent such DIP Loans remain
outstanding, they will be subordinated to the interests of the Third Party
DIP Financing.
A Form of DIP Commitment Letter, substantially the same as the DIP
Commitment Letters executed between the Borrowers/Guarantors and each of Lynx
and Furman on November 18, 1998, is attached as Exhibit 21.
Item 7. Material to be filed as Exhibits.
Item 7 is hereby amended to include the following:
Exhibit 21: Form of DIP Commitment Letter which is substantially the same as
the DIP Commitment Letters executed between Borrowers and Guarantors and each
of Lynx and Furman on November 18, 1998.
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SIGNATURES
After reasonable inquiry and to the best knowledge and belief of each
of the undersigned, such person certifies that the information set forth in
this Statement with respect to such person is true, complete and correct.
IN WITNESS WHEREOF, each of the undersigned has executed this
instrument as of the 30th day of November, 1998.
LYNX VENTURES L.P.,
LYNX VENTURES L.L.C.,
THE OVITZ FAMILY LIMITED PARTNERSHIP,
THE MICHAEL AND JUDY OVITZ REVOCABLE TRUST,
MICHAEL S. OVITZ,
ROY L. FURMAN
pursuant to powers of attorney executed in favor of and granted and
delivered to
David R. Maisel, and
DAVID R. MAISEL
By: David R. Maisel, on his own behalf and as attorney-in-fact for
Lynx Ventures L.P., Lynx Ventures L.L.C., the Ovitz Family Limited
Partnership, the Michael and Judy Ovitz Revocable Trust, Michael S.
Ovitz and Roy L. Furman.
By: /s/ David R. Maisel
Name: David R. Maisel
<PAGE>
EXHIBIT 18
***** INDIVIDUAL LOAN AGREEMENT
*****
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This Agreement dated as of February 3, 1997, is between ***** (the "Bank")
and Michael Steven Ovitz and Judy Lynn Ovitz, Trustees of the Michael Ovitz
and Judy Ovitz Revocable Trust dated November 24, 1992 as amended and
completely restated on September 27, 1998 (the "Borrower").
1. LINE OF CREDIT AMOUNT AND TERMS
1.1 Line of Credit Amount.
(a) During the availability period described below, the Bank will provide a
line of credit to the Borrower. The amount of the line of credit (the
"Commitment") is *****.
(b) This is a revolving line of credit. During the availability period, the
Borrower may repay principal amounts and reborrow them.
(c) The Borrower agrees not to permit the outstanding principal balance of
the line of credit to exceed the Commitment.
1.2 Availability Period. The line of credit is available between the
date of this Agreement and March 1, 1998 (the "Expiration Date")
unless the Borrower is in default.
1.3 Interest Rate.
(a) Unless the Borrower elects an optional interest rate as described
below, the interest rate is the Bank's Reference Rate.
(b) The Reference Rate is the rate of interest publicly announced from time
to time by the Bank in ***** as its Reference Rate. The Reference
Rate is set by the Bank based on various factors, including the Bank's
costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans. The
Bank may price loans to its customers at, above, or below the
Reference Rate. Any change in the Reference Rate shall take effect at
the opening of business on the day specified in the public
announcement of a change in the Bank's Reference Rate.
1.4 Repayment Terms.
(a) The Borrower will pay interest on March 1, 1997 and then monthly
thereafter until payment in full of any principal outstanding under
this line of credit.
(b) The Borrower will repay in full all principal and any unpaid interest
or other charges outstanding under this line of credit no later than
the Expiration Date.
(c) Any amount bearing interest at an optional interest rate (as described
below) may be repaid at the
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end of the applicable interest period, which shall no later than
ninety (90) days after the Expiration Date.
1.5 Optional Interest Rates. Instead of the interest rate based on the
Bank's Reference Rate, the Borrower may elect to have all or portions of the
line of credit (during the availability period and during the term repayment
period) bear interest at the rate(s) described below during an interest
period agreed to by the Bank and the Borrower. Each interest rate is a rate
per year. Interest will be paid on the last day of each interest period, and
on the first day each month during the interest period. At the end of any
interest period, the interest rate will revert to the rate based on the
Reference Rate, unless the Borrower has designated another optional interest
rate for the portion.
1.6 Fixed Rate. The Borrower may elect to have all or portions of the
principal balance of the line of credit bear interest at the Fixed Rate,
subject to the following requirements:
(a) The "Fixed Rate" means the fixed interest rate the Bank and the
Borrower agree will apply to the portion during the applicable interest
period.
(b) The interest period during which the Fixed Rate will be in effect will
be no shorter than 14 days and no longer than one year.
(c) Each Fixed Rate portion will be for an amount not less than Five
Hundred Thousand Dollars ($500,000).
(d) The Borrower may not elect a Fixed Rate with respect to any portion
of the principal balance of the line of credit which is scheduled to
be repaid before the last day of the applicable interest period.
(e) Any portion of the principal balance of the line of credit already
bearing interest at the Fixed Rate will not be converted to a
different rate during its interest period.
(f) Each prepayment of a Fixed Rate portion, whether voluntary, by reason
of acceleration or otherwise, will be accompanied by the amount of
accrued interest on the amount prepaid, and a prepayment fee equal to
the amount (if any) by which
(i) the additional interest which would have been payable on the
amount prepaid had it not been paid until the last day of the
interest period, exceeds
(ii) the interest which would have been recoverable by the Bank by
placing the amount prepaid on deposit in the certificate of
deposit market for a period starting on the date on which it was
prepaid and ending on the last day of the interest period for such
portion.
1.7 LIBOR Rate. The Borrower may elect to have all or portions of the
principal balance bear interest at the LIBOR Rate plus 1.00 percentage point.
Designation of a LIBOR Rate portion is subject to the following requirements:
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(a) The interest period during which the LIBOR Rate will be in effect will
be one, two, three, four, five, six, seven, eight, nine, ten, eleven,
or twelve months. The first day of the interest period must be a day
other than a Saturday or a Sunday on which the Bank is open for
business in California, New York and London and dealing in offshore
dollars (a "LIBOR Banking Day"). The last day of the interest period
and the actual number of days during the interest period will be
determined by the Bank using the practices of the London inter-bank
market.
(b) Each LIBOR Rate portion will be for an amount not less than Five
Hundred Thousand Dollars ($500,000).
(c) The "LIBOR Rate" means the interest rate determined by the following
formula, rounded upward to the nearest 1/100 of one percent. (All
amounts in the calculation will be determined by the Bank as of the
first day of the interest period.)
LIBOR Rate = LONDON INTER-BANK OFFERED RATE
(1.00 - Reserve Percentage)
Where,
(i) "London inter-Bank Offered Rate" means the interest rate at which
the Bank's London Branch, London, Great Britain, would offer U.S.
dollar deposits for the applicable interest period to other major
banks in the London inter-bank market at approximately 11:00 a.m.
London time two (2) London Banking Days before the commencement of
the interest period. A "London Banking Day" is a day on which the
Bank's London Branch is open for business and dealing in offshore
dollars.
(ii) "Reserve Percentage" means the total of the maximum reserve
percentages for determining the reserves to be maintained by member
banks of the Federal Reserve System for Eurocurrency Liabilities, as
defined in Federal Reserve Board Regulation D, rounded upward to the
nearest 1/100 of one percent. The percentage will be expressed as a
decimal, and will include, but not be limited to, marginal, emergency,
supplemental, special, and other reserve percentages.
(d) The Borrower shall irrevocably request a LIBOR Rate portion no later
than 12:00 noon ***** time on the LIBOR Banking Day preceding the day
on which the London Inter-Bank Offered Bank will be set, as specified
above.
(e) The Borrower may not elect a LIBOR Rate with respect to any principal
amount which is scheduled to be repaid before the last day of the
applicable interest period.
(f) Any portion of the principal balance already bearing interest at the
LIBOR Rate will not be converted to a different rate during its
interest period.
(g) Each prepayment of a LIBOR Rate portion, whether voluntary, by reason
of acceleration or otherwise, will be accompanied by the amount of
accrued interest on the amount prepaid and a prepayment fee as
described below. A "prepayment" is a payment of an amount on a date
earlier than the scheduled payment date for such amount as required by
this Agreement. The prepayment fee shall be equal to the amount (if
any) by which:
<PAGE>
(i) the additional interest which would have been payable during the
interest period on the amount prepaid had it not been prepaid
exceeds
(ii) the interest which would have been recoverable by the Bank by
placing the amount prepaid on deposit in the domestic certificate
of deposit market, the eurodollar deposit market, or other
appropriate money market selected by the Bank, for a period
starting on the date on which it was prepaid and ending on the
last day of the interest period for such portion (or the
scheduled payment date for the amount prepaid, if earlier).
(h) The Bank will have no obligation to accept an election for a LIBOR
Rate portion if any of the following described events has occurred
and is continuing:
(i) Dollar deposits in the principal amount, and for periods equal
to the interest period, of LIBOR Rate portion are not available
in the London inter-bank market; or
(ii) the LIBOR Rate does not accurately reflect the cost of a LIBOR
Rate portion.
2. DISBURSEMENTS, PAYMENTS AND COSTS
2.1 Requests for Credit. Each request for an extension of credit will be
made in writing in a manner acceptable to the Bank, or by another means
acceptable to the Bank.
2.2 Disbursements and Payments. Each disbursement by the Bank and each
payment by the Borrower will be:
(a) made at the Bank's branch (or other location) selected by the Bank
from time to time;
(b) made for the account of the Bank's branch selected by the Bank from
time to time;
(c) made in immediately available funds, or such other type of funds
selected by the Bank;
(d) evidenced by records kept by the Bank. In addition, the Bank may, at
its discretion, require the Borrower to sign one or more promissory
notes.
2.3 Telephone Authorization.
(a) The Bank may honor telephone instructions for advances or repayments or
for the designation of optional interest rates given by any one of the
individual signer(s) of this Agreement or a person or persons
authorized in writing by any one of the signer(s) of this Agreement.
(b) Advances will be deposited in and repayments will be withdrawn from the
Borrower's account number ___________________________, or such other of
the Borrower's accounts with the Bank as designated in writing by the
Borrower.
(c) The Borrower indemnifies and excuses the Bank (including the officers,
employees, and agents)
<PAGE>
from all liability, loss, and costs in connection with any act
resulting from telephone instructions it reasonably believes are made
by any individual authorized by the Borrower to give such instructions.
This indemnity and excuse will survive this Agreement's termination.
2.4 Direct Debit (Pre-Billing).
(a) The Borrower agrees that the Bank will debit the Borrower's deposit
account number ___________________________, or such other of the
Borrower's accounts with the Bank as designated in writing by the
Borrower (the "Designated Account") on the date each payment of
principal and interest and any fees from the Borrower becomes due (the
"Due Date"). If the Due Date is not a banking day, the Designated
Account will be debited on the next banking day.
(b) Approximately 10 days prior to each Due Date, the Bank will mail to the
Borrower a statement of the amounts that will be due on that Due Date
(the "Billed Amount"). The calculation will be made on the assumption
that no new extensions of credit or payments will be made between the
date of the billing statement and the Due Date, and that there will be
no changes in the applicable interest rate.
(c) The Bank will debit the Designated Account for the Billed Amount,
regardless of the actual amount due on that date (the "Accrued
Amount"). If the Billed Amount debited to the Designated Account
differs from the Accrued Amount, the discrepancy will be treated as
follows:
(i) If the Billed Amount is less than the Accrued Amount, the Billed
Amount for the following Due Date will be increased by the amount
of the discrepancy. The Borrower will not be in default by reason
of any such discrepancy.
(ii) If the Billed Amount is more than the Accrued Amount, the Billed
Amount for the following Due Date will be decreased by the amount
of the discrepancy.
Regardless of any such discrepancy, interest will continue to accrue
based on the actual amount of principal outstanding without
compounding. The Bank will not pay the Borrower interest on any
overpayment.
(d) The Borrower will maintain sufficient funds in the Designated Account
to cover each debit. If there are insufficient funds in the Designated
Account on the date the Bank enters any debt authorized by this
Agreement, the debit will be reversed.
(e) The Borrower may terminate this direct debit arrangement at any time by
sending written notice to the Bank at the address specified at the end
of this Agreement. If the Borrower terminates this arrangement, then
the principal amount outstanding under this Agreement will at the
option of the Bank bear interest at a rate per annum which is 0.50
percentage point higher than the rate of interest otherwise provided
under this Agreement.
2.5 Banking Days. Unless otherwise provided in this Agreement, a banking
day is a day other than a Saturday or a Sunday on which the Bank is open for
business in *****. For amounts bearing interest at an offshore rate (if any),
a banking day is a day other than a Saturday or a Sunday on which the Bank is
open for business in ***** and dealing in offshore dollars. All payments and
disbursements which would be due
<PAGE>
on a day which is not a banking day will be due on the next banking day. All
payments received on a day which is not a banking day will be applied to the
credit on the next banking day.
2.6 Taxes. The Borrower will not deduct any taxes from any payments it
makes to the Bank. If any government authority imposes any taxes on any
payments made by the Borrower, the Borrower will pay the taxes and will also
pay to the Bank, at the time interest is paid, any additional amount which
the Bank specifies as necessary to preserve the after-tax yield the Bank
would have received if such taxes had not been imposed. Upon request by the
Bank, the Borrower will confirm that it has paid the taxes by giving the Bank
official tax receipts (or notarized copies) within 30 days after the due
date. However, the Borrower will not pay the Bank's net income taxes.
2.7 Interest Calculation. Except as otherwise stated in this Agreement,
all interest and fees, if any, will be computed on the basis of a 360-day
year and the actual number of days elapsed. This results in more interest or
a higher fee than if a 365-day year is used.
2.8 Interest on Late Payments. At the Bank's sole option in each
instance, any amount not paid when due under this Agreement (including
interest) shall bear interest from the due date at the Bank's Reference Rate
plus 1.00 percentage points. This may result in a compounding of interest.
2.9 Default Rate. Upon the occurrence and during the continuation of
any default under this Agreement, advances under this Agreement will at the
option of the Bank bear interest at a rate per annum which is 1.00 percentage
point higher than the rate of interest otherwise provided under this
Agreement. This will not constitute a waiver of any event of default.
3. CONDITIONS
The Bank must receive the following items, in form and content acceptable to
the Bank, before it is required to extend any credit to the Borrower under
this Agreement:
3.1 Guaranties. Guaranties signed by Michael S. Ovitz, Judy L. Ovitz
and the Ovitz Family Limited Partnership, each in the amount of *****.
3.2 Authorizations. Evidence that the execution, delivery and
performance by the Borrower and each guarantor of this Agreement and of any
instrument or agreement required under this Agreement have been duly
authorized.
3.3 Conditions to Each Advance. Before each extension of credit,
including the first:
(a) A statement by the Borrower describing the purpose of the extension of
credit, the projected source of repayment, and any other relevant
information or projection the Bank may request.
3.4 Other Items. Any other items that the Bank reasonably requires.
<PAGE>
4. REPRESENTATIONS AND WARRANTIES
When the Borrower signs this Agreement, and until the Bank is repaid in full,
the Borrower makes the following representations and warranties. Each request
for an extension of credit constitutes a renewed representation.
4.1 Organization of Borrower. The Borrower is comprised of the
trustee(s) of a trust duly formed and existing under the laws of the state
where organized.
4.2 Authorization. This Agreement, and any instrument or agreement
required hereunder, are within the Borrower's powers, have been duly
authorized, and do not conflict with any of its organizational papers.
4.3 Enforceable Agreement. This Agreement is a legal, valid and binding
agreement of the Borrower, enforceable against the Borrower in accordance
with its terms, and any instrument or agreement required hereunder, when
executed and delivered, will be similarly legal, valid, binding and
enforceable.
4.4 No Conflicts. This Agreement does not conflict with any law,
agreement, or obligation by which the Borrower is bound.
4.5 Financial Information. All financial and other information that has
been or will be supplied to the Bank, including the Borrower's financial
statement dated as of October 31, 1996, is:
(a) sufficiently complete to give the Bank accurate knowledge of the
Borrower's (and any guarantor's) and any trustor's financial condition.
(b) in form and content required by the Bank.
(c) in compliance with all government regulations that apply.
Since the date of the financial statement specified above, there has been no
material adverse change in the assets or the financial condition of the
Borrower (or any guarantor) or any trustor.
4.6 Lawsuits. There is no lawsuit, tax claim or other dispute pending or
threatened against the Borrower, its property or any of its business, which,
if lost, would impair the Borrower's financial condition or that of the
Borrower's business or would impair the Borrower's ability to repay the loan,
except as have been disclosed in writing to the Bank.
4.7 Other Obligations. The Borrower is not in default on any obligation
for borrowed money, any purchase money obligation or any other material
lease, commitment, contract, instrument or obligation.
4.8 Income Tax Returns. The Borrower has no knowledge of any pending
assessments or adjustments of its income tax for any year.
4.9 No Event of Default. There is no event which is, or with notice or
lapse of time or both would be, a default under this Agreement.
<PAGE>
5. COVENANTS
The Borrower agrees, so long as credit is available under this Agreement and
until the Bank is repaid in full:
5.1 Use of Proceeds - Ineligible Securities. Not to use, directly or
indirectly, any portion of the proceeds of the credit (including any letters
of credit) for any of the following purposes:
(a) knowingly to purchase Ineligible Securities from ***** (the "Arranger")
during any period in which the Arranger makes a market in such
Ineligible Securities; or
(b) knowingly to purchase during the underwriting or placement period
Ineligible Securities being underwritten or privately placed by the
Arranger.
"Ineligible Securities" means securities which may be underwritten or dealt
in by member banks of the Federal Reserve System under Section 16 of the
Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as amended. The Arranger
is a *****, and is a registered broker-dealer which is permitted to
underwrite and deal in certain Ineligible Securities.
5.2 Financial Information. To provide the following financial
information and statements and such additional information as requested by
the Bank from time to time:
(a) Within 90 days of each calendar year end, the Borrower's annual
financial statements combined with the annual financial statements of
Michael S. Ovitz and Judy L. Ovitz. These financial statements may be
Borrower prepared.
(b) Copies of the Borrower's federal income tax return combined with the
federal income tax returns of Michael S. Ovitz and Judy L. Ovitz (with
all forms K-1 attached), within 15 days of filing, together with a
statement of any contributions made by the Borrower to any subchapter S
corporation or trust, and, if requested by the Bank, copies of any
extensions of the filing date.
(c) The Ovitz Family Limited Partnership's federal income tax return,
within 15 days of filing, and, if requested by the Bank, copies of any
extensions of the filing date.
5.3 Net Worth. To maintain net worth equal to at least *****.
"Net worth" means the gross fair market value of the Borrower's assets
(excluding all intangibles, goodwill, patents, trademarks, copyrights, trade
names, start-up costs, non-compete covenants, and other like intangibles)
less total liabilities, excluding estimated taxes on asset appreciation and
any reserves or offsets against assets.
5.4 Liquidity. With respect to the Borrower and the guarantors on an
aggregate basis, to maintain unencumbered liquid assets equal to at least
*****.
"Liquid assets" means the following assets of the Borrower and guarantors:
<PAGE>
(a) cash and certificates of deposit;
(b) U.S. treasury bills and other obligations of the federal government;
(c) readily marketable securities (including commercial paper, but
excluding restricted stock and stock subject to the provisions of Rule
144 of the Securities and Exchange Commission);
(d) bankers' acceptances issued by financial institutions;
(e) repurchase agreements covering U.S. government securities.
Within 30 days of each calendar quarter end, the Borrower and guarantor shall
provide to the Bank copies of statements from depository institutions or
brokerage firms, or other evidence acceptable to the Bank of the Borrower's
and guarantor's liquid assets.
If more than 25% of the value of the Borrower's liquid assets is represented
by margin stock, the Borrower will provide the Bank a Form U-1 Purpose
Statement, and the Bank and the Borrower will comply with the restrictions
imposed by Regulation U of the Federal Reserve, which may require a reduction
in the amount of credit provided to the Borrower.
5.5 Trusts. Not to transfer any of the Borrower's assets to a trust
unless the trust is acceptable to the Bank in form and content, and the
trustee guarantees payment of the Borrower's obligations under this Agreement
prior to any such transfer.
5.6 Other Debts. Not to have outstanding or incur any direct or
contingent debts (other than those to the Bank), or become liable for the
debts of others, without the Bank's written consent. This does not prohibit:
(a) Endorsing negotiable instruments received in the usual course of
business.
5.7 Other Liens. Not to create, assume, or allow any security interest
or lien (including judicial liens) on property the Borrower now or later
owns, except:
(a) Deeds of trust and security agreements in favor of the Bank.
(b) Liens for taxes not yet due.
5.8 Notices to Bank. To promptly notify the Bank in writing of:
(a) any lawsuit over One Million Dollars ($1,000,000) against the Borrower
(or any guarantor) or any trustor or any of the Borrower's property or
business.
(b) any substantial dispute between the Borrower (or any guarantor) or any
trustor and any government authority, or which may affect the
Borrower's property or business.
(c) any failure to comply with this Agreement.
<PAGE>
(d) any material adverse change in the Borrower's (or any guarantor's) or
any trustor's financial condition or operations.
(e) any change in the Borrower's name or address.
5.9 Compliance with Laws. To comply with the laws, regulations, and
orders of any government body with authority over the Borrower's business.
5.10 Cooperation. to take any action requested by the Bank to carry out
the intent of this Agreement.
5.11 Additional Negative Covenants. Not to, without the Bank's written
consent:
(a) sell or otherwise dispose of any assets for less than fair market value
or enter into any sale and leaseback agreement covering any of the
fixed or capital assets.
6. DEFAULT
If any of the following events occur, the Bank may do one or more of the
following: declare the Borrower in default, stop making any additional credit
available to the Borrower, and require the Borrower to repay its entire debt
immediately and without prior notice. If an event of default occurs under the
paragraph entitled "Bankruptcy," below, with respect to the Borrower, then
the entire debt outstanding under this Agreement will automatically become
due immediately.
6.1 Failure to Pay. The Borrower falls to make a payment under this
Agreement when due.
6.2 False Information. The Borrower has given the Bank false or
misleading information or representations.
6.3 Death. Any trustor of the Borrower dies.
6.4 Bankruptcy. The Borrower (or any guarantor) or any trustor files a
bankruptcy petition, a bankruptcy petition is filed against the Borrower (or
any guarantor) or any trustor, or the Borrower (or any guarantor) or any
trustor makes a general assignment for the benefit of creditors.
6.5 Receivers; Termination. A receiver or similar official is appointed
for the Borrower's (or any guarantor's) or any trustor's business, or the
business is terminated; or any guarantor is liquidated or dissolved.
6.6 Judgments. Any judgments or arbitration awards are entered against
the Borrower (or any guarantor) or any trustor; or the Borrower (or any
guarantor) or any trustor enters into any settlement agreements with respect
to any litigation or arbitration, in an aggregate amount of One Million
Dollars ($1,000,000) or more in excess of any insurance coverage.
6.7 Government Action. Any government authority takes action that the
Bank believes materially adversely affects the Borrower's (or any
guarantor's) or any trustor's financial condition or ability to repay.
6.8 Material Adverse Change. A material adverse change occurs in the
Borrower's (or any
<PAGE>
guarantor's) or any trustor's financial condition, properties or prospects,
or ability to repay the loan.
6.9 Cross-default. Any default occurs under any agreement in connection
with any credit the Borrower (or any guarantor) or any trustor has obtained
from anyone else or which the Borrower (or any guarantor) or any trustor has
guaranteed.
6.10 Default under Related Documents. Any guaranty or other document
required by this Agreement is violated or no longer in effect.
6.11 Other Bank Agreements. The Borrower (or any guarantor) or any
trustor fails to meet the conditions of, or fails to perform any obligation
under any other agreement the Borrower (or any guarantor) or any trustor has
with the Bank or any affiliate of the Bank.
6.12 Use of Proceeds. The Borrower does not utilize or invest the
proceeds of any extension of credit made under this Agreement for the
purposes described by the Borrower to the Bank.
6.13 Other Breach under Agreement. The Borrower fails to meet the
conditions of, or fails to perform any obligation under, any term of this
Agreement not specifically referred to in this Article.
6.14 Revocation or Termination. The Borrower is revoked or otherwise
terminated or all or a substantial part of the Borrower's assets are
distributed or otherwise disposed of.
7. ENFORCING THIS AGREEMENT; MISCELLANEOUS
7.1 Financial Computations. Except as otherwise stated in this
Agreement, all financial information provided to the Bank and all financial
covenants will be made in accordance with accounting principles applied
consistently with those applied in the preparation of the Borrower's
financial statements dated October 31, 1996, and shall specifically exclude
any upward revaluation of assets (other than marketable securities) after
that date, provided, however, that assets may be listed at market value on
the condition that deferred income taxes on any unrealized gain are shown as
a liability. The calculation of the Borrower's assets shall exclude goodwill
and other intangibles.
7.2 California Law. This Agreement is governed by California law.
7.3 Successors and Assigns. This Agreement is binding on the Borrower's
and the Bank's successors and assignees. The Borrower agrees that it may not
assign this Agreement without the Bank's prior consent. The Bank may sell
participations in or assign this loan, and may exchange financial information
about the Borrower with actual or potential participants or assignees;
provided that such actual or potential participants or assignees shall agree
to treat all financial information exchanged as confidential. If a
participation is sold or the loan is assigned, the purchaser will have the
right of set-off against the Borrower.
7.4 Arbitration.
(a) This paragraph concerns the resolution of any controversies or claims
between the Borrower and the Bank, including but not limited to those
that arise from:
<PAGE>
(i) This Agreement (including any renewals, extensions or
modifications of this Agreement);
(ii) Any document, Agreement or procedure related to or delivered in
connection with this Agreement;
(iii) Any violation of this Agreement; or
(iv) Any claims for damages resulting from any business conducted
between the Borrower and the Bank, including claims for injury
to persons, property or business interests (torts).
(b) At the request of the Borrower or the Bank, any such controversies or
claims will be settled by arbitration in accordance with the United
States Arbitration Act. The United States Arbitration Act will apply
even though this Agreement provides that it is governed by California
law.
(c) Arbitration proceedings will be administered by the American
Arbitration Association and will be subject to its commercial rules of
arbitration.
(d) For purposes of the application of the statute of limitations, the
filing of an arbitration pursuant to this paragraph is the equivalent
of the filing of a lawsuit, and any claim or controversy which may be
arbitrated under this paragraph is subject to any applicable statute of
limitations. The arbitrators will have the authority to decide whether
any such claim or controversy is barred by the statute of limitations
and, if so, to dismiss the arbitration on that basis.
(e) If there is a dispute as to whether an issue is arbitrable, the
arbitrators will have the authority to resolve any such dispute.
(f) The decision that results from an arbitration proceeding may be
submitted to any authorized court of law to be confirmed and enforced.
(g) The procedure described above will not apply if the controversy or
claim, at the time of the proposed submission to arbitration, arises
from or relates to an obligation to the Bank secured by real property
located in California. In this case, both the Borrower and the Bank
must consent to submission of the claim or controversy to arbitration.
If both parties do not consent to arbitration, the controversy or claim
will be settled as follows:
(i) The Borrower and the Bank will designate a referee (or a panel
of referees) selected under the auspices of the American
Arbitration Association in the same manner as arbitrators are
selected in Association-sponsored proceedings;
(ii) The designated referee (or the panel of referees) will be
appointed by a court as provided in California Code of Civil
Procedure Section 638 and the following related sections;
(iii) The referee (or the presiding referee of the panel) will be an
active attorney or a retired judge; and
<PAGE>
(iv) The award that results from the decision of the referee (or the
panel) will be entered as a judgment in the court that
appointed the referee, in accordance with the provisions of
California Code of Civil Procedure Sections 644 and 645.
(h) This provision does not limit the right of the Borrower or the Bank to:
(i) exercise self-help remedies such as setoff;
(ii) foreclose against or sell any real or personal property
collateral; or
(iii) act in a court of law, before, during or after the arbitration
proceeding to obtain;
(A) an interim remedy; and/or
(B) additional or supplementary remedies.
(i) the pursuit of or a successful action for interim, additional or
supplementary remedies, or the filing of a court action, does not constitute
a waiver of the right of the Borrower or the Bank, including the suing party,
to submit the controversy or claim to arbitration if the other party contests
the lawsuit. However, if the controversy or claim arises from or relates to
an obligation to the Bank which is secured by real property located in
California at the time of the proposed submission to arbitration, this right
is limited according to the provision above requiring the consent of both the
Borrower and the Bank to seek resolution through arbitration.
(j) If the Bank forecloses against any real property securing this
Agreement, the Bank has the option to exercise the power of sale under
the deed of trust or mortgage, or to proceed by judicial foreclosure.
7.5 Severability; Waivers. If any part of this Agreement is not
enforceable, the rest of the Agreement may be enforced. The Bank retains all
rights, even if it makes a loan after default. If the Bank waives a default,
it may enforce a later default. Any consent or waiver under this Agreement
must be in writing.
7.6 Attorneys' Fees. The Borrower shall reimburse the Bank for any
reasonable costs and attorneys' fees incurred by the Bank in connection with
the enforcement or preservation of any rights or remedies under this
Agreement and any other documents executed in connection with this Agreement,
and including any amendment, waiver, "workout" or restructuring under this
Agreement. In the event of a lawsuit or arbitration proceeding, the
prevailing party is entitled to recover costs and reasonable attorneys' fees
incurred in connection with the lawsuit or arbitration proceeding, as
determined by the court or arbitrator. As used in this paragraph, "attorneys'
fees" includes the allocated costs of the Bank's in-house counsel.
7.7 One Agreement. This Agreement and any related security or other
agreements required by this Agreement, collectively:
(a) represent the sum of the understandings and agreements between the
Bank and the Borrower concerning this credit;
<PAGE>
(b) replace any prior oral or written agreements between the Bank and the
Borrower concerning this credit; and
(c) are intended by the Bank and the Borrower as the final, complete and
exclusive statement of the terms agreed to by them.
In the event of any conflict between this Agreement and any other agreements
required by this Agreement, this Agreement will prevail.
7.8 Notices. All notices required under this Agreement shall be
personally delivered or sent by first class mail, postage prepaid, to the
addresses on the signature page of this Agreement, or to such other addresses
as the Bank and the Borrower may specify from time to time in writing.
7.9 Headings. Article and paragraph headings are for reference only and
shall not affect the interpretation or meaning of any provisions of this
Agreement.
7.10 Counterparts. This Agreement may be executed in as many counterparts
as necessary or convenient, and by the different parties on separate
counterparts each of which, when so executed, shall be deemed an original but
all such counterparts shall constitute but one and the same Agreement.
This Agreement is executed as of the date stated at the top of the first page.
[logo]
*****
X __________________________
By: *****
Title: Vice President
X __________________________
Michael Steven Ovitz, Trustee of the Michael Ovitz and Judy Ovitz
Revocable Trust dated November 24, 1992 as amended and completely
restated on September 27, 1995
X ____________________________
Judy Lynn Ovitz, Trustee of the Michael Ovitz and Judy Ovitz Revocable
Trust dated November 24, 1992 as amended and completely restated on
September 27, 1995
Address where notices to the Bank are to be sent:
*****
*****
Address where notices to the Borrower are to be sent:
C/O Michael Dreyer
355 South Grand Avenue, Suite 4150
Los Angeles, California 90071
<PAGE>
- -------------------------------------------------------------------------------
***** AMENDMENT TO DOCUMENTS
*****
- -------------------------------------------------------------------------------
AMENDMENT NO. 1 TO INDIVIDUAL LOAN AGREEMENT
This Amendment No. 1 (the "Amendment") dated as of May 30, 1997, is
between ***** (the "Bank") and Michael Steven Ovitz and Judy Lynn Ovitz,
Trustees of the Michael Ovitz and Judy Ovitz Revocable Trust dated November
24, 1992, as amended and completely restated on September 27, 1995 (the
"Borrower").
RECITALS
A. The Bank and the Borrower entered into a certain Individual
Loan Agreement dated as of February 3, 1997 (the "Agreement").
B. The Bank and the Borrower desire to amend the Agreement.
AGREEMENT
1. DEFINITIONS. Capitalized terms used but not defined in this Amendment
shall have the meaning given to them in the Agreement.
2. AMENDMENTS. The Agreement is hereby amended as follows:
2.1 In Paragraph 1.1(a) of the Agreement, the amount ***** is
substituted for the amount *****.
2.2 Paragraph 5.4 of the Agreement is amended to read in its entirety as
follows:
"5.4 Liquidity. With respect to the Borrower and guarantors on an
aggregate basis, to maintain unencumbered liquid assets ***** equal
to at least ***** or 100% of the principal amount outstanding under
this Agreement, whichever is greater; ******.
"Liquid assets" means the following assets:
(a) cash and certificates of deposit;
(b) U.S. treasury bills and other obligations of the federal
government;
(c) readily marketable securities (including commercial paper,
excluding restricted stock and stock subject to the provision
of Rule 144 of the Securities and Exchange Commission);
(d) bankers' acceptance issued by financial institutions;
(e) repurchase agreements covering U.S. government securities.
<PAGE>
Within 30 days of each quarter end, the Borrower shall provide to the
Bank copies of statements from the depository institutions or
brokerage firms, or other evidence acceptable to the Bank of the
liquid assets required by this paragraph.
If more than 25% of the value of the liquid assets covered by this
paragraph are represented by margin stock, the Borrower will provide
the Bank a Form U-1 Purpose Statement, and the Bank and the Borrower
will comply with the restrictions imposed by Regulation U of the
Federal Reserve, which may require a reduction in the amount of credit
provided to the Borrower."
3. CONDITIONS. This Amendment will be effective when the Bank receives
the following items, in form and content acceptable to the Bank:
3.1 Regulation U Statement of purpose, executed by the Borrower and the
Bank.
3.2 Trust Authority Letter, executed by the Borrower.
3.3 Notice to Cosigner, executed by Michael S. Ovitz and Judy L. Ovitz.
3.4 Guarantees signed by Michael S. Ovitz and Judy L. Ovitz Family Limited
Partnership, each in the amount of *****.
4. EFFECT OF AMENDMENT. Except as provided in this Amendment, all of
the terms and conditions of the Agreement shall remain in full force and
effect.
This Amendment is executed as of the date stated at the beginning of
this Amendment.
*****
*****
X__________________________________ X__________________________________
By: *****, Vice President By: Michael Steven Ovitz, trustee
of the Michael Ovitz and Judy
Ovitz Revocable Trust dated
November 24, 1992, as amended
and completely restated on
September 27, 1995
X___________________________________
By: Judy Lynn Ovitz, Trustee of
the Michael Ovitz and Judy
Ovitz Revocable Trust dated
November 24, 1992, as amended
and completely restated on
September 27, 1995
<PAGE>
- --------------------------------------------------------------------------------
***** AMENDMENT TO DOCUMENTS
- --------------------------------------------------------------------------------
AMENDMENT NO. 2 TO INDIVIDUAL LOAN AGREEMENT
This Amendment No. 2 (the "Amendment") dated as of March 24, 1998,
is between ***** (the "Bank") and Michael Steven Ovitz and Judy Lynn Ovitz,
Trustees of the Michael Ovitz and Judy Ovitz Revocable Trust dated November
24, 1992, as amended and completely restated on September 27, 1995 (the
"Borrower").
RECITALS
A. The Bank and the Borrower entered into a certain Individual Loan
Agreement dated as of February 3, 1997, as previously amended (the
"Agreement").
B. The Bank and the Borrower desire to further amend the Agreement.
AGREEMENT
1. DEFINITIONS. Capitalized terms used but not defined in this
Amendment shall have the meaning given to them in the Agreement.
2. AMENDMENTS. The Agreement is hereby amended as follows:
2.1 In Paragraph 1.2 of the Agreement, the date "May 1,
2000" is substituted for the date "March 1, 1995."
2.2 Subparagraph 2.3(b) of the Agreement is amended to read
in its entirety as follows:
(b) Advances will be deposited in and repayments will be
withdrawn from *****, or such other of the Borrower's
accounts with the Bank as designated in writing by the
Borrower.
2.3 Subparagraph 2.4(a) of the Agreement is amended to read in
its entirety as follows:
(a) The Borrower agrees that the Bank will debit *****, or
such other of the Borrower's accounts with the Bank as
designated in writing by the Borrower (the "Designated
Account") on the date each payment of principal and
interest and any fees from the Borrower becomes due (the
"Due Date"). If the Due Date is not a banking day, the
Designated Account will be debited on the next banking
day."
2.4 Paragraph 7.5 of the Agreement is amended to read in its
entirety as follows:
<PAGE>
"7.6 Attorneys' Fees. The Borrower shall reimburse
the Bank for any reasonable costs and attorneys' fees
incurred by the Bank in connection with the
enforcement or preservation of any rights or remedies
under this Agreement and any other documents executed
in connection with this Agreement, and in connection
with any amendment, waiver, "workout" or
restructuring under this Agreement. In the event of a
lawsuit or arbitration proceeding, the prevailing
party is entitled to recover costs and reasonable
attorneys' fees incurred in connection with the
lawsuit or arbitration proceeding, as determined by
the court or arbitrator. In the event that any case
is commenced by or against the Borrower under the
Bankruptcy Code (Title 11, United States Code) or any
similar or successor statute, the Bank is entitled to
recover costs and reasonable attorneys' fees incurred
by the Bank related to the preservation, protection,
or enforcement of any rights of the Bank in such a
case. As used in this paragraph, "attorneys' fees"
includes the allocated costs of the Bank's in-house
counsel."
3. CONDITIONS. This Amendment will be effective when the Bank
receives the following items, in form and content acceptable to the Bank:
3.1 Authorizations. Evidence that the execution, delivery
and performance by the Borrower, ***** and any
guarantors of the Agreement and any instrument or
agreement required under the Agreement have been duly
authorized.
<PAGE>
4. EFFECT OF AMENDMENT. Except as provided in this Amendment,
all of the terms and conditions of the Agreement shall remain in full force
and effect.
This Amendment is executed as of the date stated at the
beginning of this Amendment.
*****
*****
X___________________________________ X___________________________________
By: *****, Vice President By: Michael Steven Ovitz, trustee
of the Michael Ovitz and Judy
Ovitz Revocable Trust dated
November 24, 1992, as amended
and completely restated on
September 27, 1995
X__________________________________
By: Judy Lynn Ovitz, Trustee of
the Michael Ovitz and Judy
Ovitz Revocable Trust dated
November 24, 1992, as amended
and completely restated on
September 27, 1995
The undersigned acknowledges the provisions of Paragraphs 2.2 and 2.3 of this
Amendment, and agrees that the account shown therein may be debited and
credited as set forth therein. The undersigned is the owner of the account.
Dated: March 24, 1998
*****
By: Ovitz Family Limited Partnership, By: Michael Ovitz and Judy Ovitz
Member Revocable Trust, Member
----------------------------------- -----------------------------------
Michael Steven Ovitz, Trustee of Michael Steven Ovitz, Trustee of
the Michael Ovitz and Judy Ovitz the Michael Ovitz and Judy Ovitz
Revocable Trust dated November 24, Revocable Trust dated November 24,
1992, as amended and completely 1992, as amended and completely
restated on September 27, 1995, restated on September 27, 1995
General Partner
----------------------------------- -----------------------------------
Judy Lynn Ovitz, Trustee of the Judy Lynn Ovitz, Trustee of the
Michael Ovitz and Judy Ovitz Michael Ovitz and Judy Ovitz
Revocable Trust dated November 24, Revocable Trust dated November 24,
1992, as amended and completely 1992, as amended and completely
restated on September 27, 1995, restated on September 27, 1995
General Partner
<PAGE>
- --------------------------------------------------------------------------------
***** AMENDMENT TO DOCUMENTS
- --------------------------------------------------------------------------------
AMENDMENT NO. 3 TO INDIVIDUAL LOAN AGREEMENT
This Amendment No. 3 (the "Amendment") dated as of April 27, 1998, is
between ***** (the "Bank") and Michael Steven Ovitz and Judy Lynn Ovitz,
Trustee of the Michael Ovitz and Judy Ovitz Revocable Trust dated November
24, 1992, as amended and completely restated on September 27, 1995 (the
"Borrower").
RECITALS
A. The Bank and the Borrower entered into a certain Individual Loan
Agreement dated as of February 3, 1997, as previously amended (the
"Agreement").
B. The Bank and the Borrower desire to further amend the Agreement.
AGREEMENT
1. DEFINITIONS. Capitalized terms used but not defined in this
Amendment shall have the meaning given to them in the Agreement.
2. AMENDMENTS. The Agreement is hereby amended as follows:
2.1 In Paragraph 1.1(a) of the Agreement, the amount ***** is
substituted for the amount *****
3. CONDITIONS. This Amendment will be effective when the Bank
receives the following items, in form and content acceptable to the Bank:
3.1 This Amendment, duly executed by the Borrower and the Bank.
3.2 A Trust Authority letter executed by the Borrower.
3.3 A Form U-1 Purpose Statement executed by the Borrower and
the Bank.
3.4 Guaranties signed by Michael S. Ovitz and Judy L. Ovitz,
and the Ovitz Family Limited Partnership, each in the amount
of *****.
3.5 A Notice to Co-Signer executed by Michael S. Ovitz and Judy
L. Ovitz.
4. EFFECT OF AMENDMENT. Except as provided in this Amendment,
all of the terms and conditions of the Agreement shall remain in full force
and effect.
This Amendment is executed as of the date stated at the
beginning of this Amendment.
*****
X___________________________________ X___________________________________
By: *****, Vice President By: Michael Steven Ovitz, Trustee
of the Michael Ovitz and Judy
Ovitz Revocable Trust dated
November 24, 1992, as amended
and completely restated on
September 27, 1995
X__________________________________
By: Judy Lynn Ovitz, Trustee of
the Michael Ovitz and Judy
Ovitz Revocable Trust dated
November 24, 1992, as amended
and completely restated on
September 27, 1995
<PAGE>
EXHIBIT 21
DIP COMMITMENT LETTER
LENDER understands that a total of $5 million will be required to
finance the working capital and general corporate requirements of Livent
Realty (New York) Inc. and Livent Realty (Chicago) Inc. (together,
"Borrowers"), Livent (U.S.) Inc. and Livent Inc. (together, "Guarantors")
during the initial phase of proceedings with respect to Borrowers' and
Guarantors' cases (the "Cases") that may be commenced under Chapter 11 of
Title 11 of the United States Code (the "Bankruptcy Code").
Subject to the terms and conditions set forth herein, LENDER
confirms that it is willing to provide $ to Borrowers (the "Loan") in
the form of a secured loan to finance the working capital and general
corporate requirements of Borrowers and Guarantors. LENDER understands that
other lenders (collectively with LENDER, the "Director Lenders") have also
agreed to advance funds to Borrowers on the same terms and conditions as set
forth herein with respect to LENDER, and that, the Loan and the loans of the
other Director Lenders (collectively, the "Director Loans," and any such loan
individually, a "Director Loan") shall be treated identically and as PARI
PASSU with one another.
TERMS
Lender: [ ] or its nominee.
Borrowers: Borrowers as debtors and debtors-in-possession in their Cases
under the Bankruptcy Code.
Guarantors: Guarantors as debtors and debtors-in-possession in their Cases
under the Bankruptcy Code.
Loan Amount: $[ ].
Maturity: The earliest of (x) the date which is 18 months after the date of
the commencement of the Chapter 11 Cases of Borrowers and
Guarantors; (y) the effective date of a plan of reorganization or
liquidation in the Cases; and (z) the date of substantial
consummation of a plan of reorganization in the Cases.
Availability: To the extent the interim order and/or final order issued by the
bankruptcy court (the "Court") hearing the Cases is otherwise
limited as to the amount of credit covered by such order,
availability under the Director Loans shall be so limited. Any
such limitation shall result in a pro-rata reduction of each of
the Director Loans.
<PAGE>
Purpose: The Loan may be utilized to provide for working capital and
general corporate requirements.
Mandatory All amounts due under the Loan, including accrued but unpaid
Repayments: interest and reasonable costs, shall be repaid upon (i) the
funding of a subsequent Debtor-In-Possession facility in the
Cases by any entity that is not a Director Lender, and (ii) the
sale of all of the assets securing the Loan (the "Security"). In
the event of a sale of less than all of the Security, the net
proceeds of such sale shall be paid in respect of the Director
Loans on a PRO-RATA basis.
Voluntary At the Borrowers' option, the Loan may be reduced or terminated
Prepayments: at any time without penalty. Voluntary prepay- ments may be made
at any time, in whole or in part (subject to specified minimum
principal amounts) without premium or penalty.
Priority: The Loan together with all unpaid interest and costs
(collectively, the "Obligations") shall constitute an allowed
administrative expense claim in the Cases pursuant to, and shall
be entitled to the benefits of, Sections 364(c)(2) and 364(c)(3),
and Sections 503(b) and 507(b) of the Bankruptcy Code. Any and
all payments made to any Director Lender in respect of a Director
Loan (including any payments made from the proceeds of any of the
Security) shall be made on an identical basis and PARI PASSU with
all other Director Loans. This Loan shall not be subject to any
Section 364(d)(4) relief or otherwise modified by the Court or a
plan of reorganization.
In conjunction with obtaining the final order, Borrowers and
Guarantors will use their best efforts to obtain for the Director
Lenders a junior lien on all assets of Borrowers and Guarantors
and a super-priority administrative expense for all Obligations
under Section 364(c)(1) of the Bankruptcy Code.
Security: The Obligations shall be secured by an enforceable second
priority perfected security interest and mortgage in (i) the Ford
Center for the Performing Arts, New York, New York, owned by
Livent Realty (New York) Inc., and (ii) the Ford Center for the
Performing Arts, 32 West Randolph, Chicago, Illinois, owned by
Livent Realty (Chicago) Inc., (together, the "DIP Liens," and
individually, a "DIP Lien").
The DIP Lien on the Ford Center for the Performing Arts in
Chicago shall be second in priority to a mortgage held by the
City of Chicago in the nominal amount of $16,920,000 to secure
the performance by Livent Realty (Chicago) Inc. under the April,
1996 Redevelopment Agreement
<PAGE>
with the City of Chicago.
If and to the extent the purported $5 million lien held by
Canadian Imperial Bank of Commerce on the Ford Center for the
Performing Arts in New York is held by the Court to be invalid or
is otherwise avoided, the DIP Lien on the Ford Center for the
Performing Arts in New York shall automatically become a first
priority security interest and mortgage in that property. The DIP
Liens shall be subject only to a post-default carve out relating
to (a) $300,000 for customary and usual professional fees, and
(b) fees of the United States Trustee.
Interest Rate: The prime commercial lending rate announced by Chase Bank, from
time to time plus 2 points. Interest in respect of the Loan shall
be paid monthly in arrears on the last business day of the month.
Interest will also be payable at the time of repayment of the
Loan and at maturity of the Loan. All interest and fee
calculations shall be based on a 360-day year and actual days
elapsed.
Upon the occurrence and continuance of any default in the payment
of any principal, interest or costs, the Loan shall bear interest
at a rate per annum equal to the rate which is 2% in excess of
the rate then borne by the Loan. Such interest shall be payable
on demand.
Covenants: Covenants to apply to the Borrowers and the Guarantors:
(1) Borrowers and Guarantors shall not cause any other liens to
be placed on the Security;
(2) Borrowers and Guarantors shall not sell any of the Security
without prior Court authorization upon notice to LENDER; and
(3) Borrowers and Guarantors shall maintain adequate insurance
on the Security, and LENDER shall be made a loss payee on
any such insurance within a reasonable time.
Events of
Default:
(1) Failure by Borrowers and Guarantors to timely pay any
Obligation when due or failure by Borrowers and Guarantors
to perform any obligation or term or condition of this
letter;
(2) The appointment of a trustee or the appointment of an
examiner
<PAGE>
with enlarged powers in the Cases;
(3) Conversion of the Cases into proceedings under Chapter 7 of
the Bankruptcy Code;
(4) A change in control or ownership of Borrowers or Guarantors;
or
(5) Failure to execute the mortgage documentation and any other
Loan documentation reasonably required by LENDER, if any, in
form and substance reasonably satisfactory to LENDER within
five (5) business days of the commencement of the Cases.
Conditions
Precedent: The funding of the Loan by LENDER is conditioned upon the
following events occurring:
(1) All necessary orders of the Court authorizing the Director
Loans and the DIP Liens shall have been entered and shall be
in full force and effect and shall not have been stayed,
reversed, vacated or rescinded, and all such orders shall be
satisfactory to LENDER and shall include a finding by the
Court that the LENDER is extending credit to Borrowers in
good faith under section 364(e) of the Bankruptcy Code;
(2) Substantially similar commitments shall have been made by
other Director Lenders so that the total commitments by all
of the Director Lenders equal at least $5 million; and
(3) LENDER, in LENDER's sole discretion, shall be satisfied that
there will be sufficient equity in the Security to secure
the Loan.
Assignments: Assignments of interests in the Loan may be made by LENDER at any
time.
To induce LENDER to issue this commitment letter, Borrowers and
Guarantors hereby agree that all reasonable fees and expenses (including the
reasonable fees of counsel and consultants) of LENDER arising in connection
with this commitment letter and in connection with the transactions described
herein (including reasonable fees and expenses incurred by LENDER to enforce
the Loan) shall be paid by Borrowers and Guarantors, whether or not the Loan
is consummated. Borrowers and Guarantors further agree to indemnify and hold
harmless
<PAGE>
LENDER from and against any and all actions, suits, proceedings, claims,
losses, damages, liabilities or expenses of any kind or nature whatsoever
which may be incurred by or asserted against LENDER as a result of or arising
out of or in any way related to or resulting from this commitment letter or
any eventual Loan, and, upon demand, to pay and reimburse LENDER for any
reasonable legal or other out-of-pocket expenses incurred in connection with
investigating, defending or preparing to defend any such action, suit,
proceeding, or claim; PROVIDED, however, that Borrowers and Guarantors shall
not be required to indemnify LENDER against any loss, claim, damage, expense
or liability to the extent it resulted from the gross negligence or willful
misconduct of LENDER. Any liability arising out of this paragraph shall be
included in the definition of the term "Obligations" under this commitment
letter.
This commitment letter is furnished for Borrowers's benefit, and may
not be relied upon by any other person or entity. LENDER shall not be
responsible or liable to Borrowers or any other person for consequential
damages which may be alleged as a result of this letter.
This commitment letter shall be construed in accordance with and
governed by the laws of the State of New York. Borrowers may terminate
LENDER'S commitment with respect to the Loan at any time.
