RNS Number:7140I
Applied Graphics Technologies Inc
17 August 2001
PART 3
ARTICLE III
AGREEMENTS
Section 3.1. Agreements.
(a) Excess Cash Flow. Notwithstanding anything to the contrary set forth in
Section 2.06(b) or (c) of the Credit Agreement, (i) (A) the Borrower shall
provide the Administrative Agent, within 45 days after June 30 of each year
and within 90 days after December 31 of each year, a certificate of a
Responsible Officer, certifying in reasonable detail as to Excess Cash Flow
measured as of the end of such fiscal half year and (B) within one Business
Day of the delivery of such certificate, prepay the Deferred Amounts and
Advances in an amount equal to such Excess Cash Flow, and (ii) any prepayments
of Excess Cash Flow pursuant to clause (i) above shall be applied, first, to
the prepayment of the Deferred Amounts and second, to the prepayment of the
Advances (in accordance with the provisions of Section 2.06(c)(ii) of the
Credit Agreement).
(b) Cash on Hand Limitation. The Borrower shall furnish to the Administrative
Agent, no later than 12:00 p.m. (New York time) on each Tuesday, a certificate
of a Responsible Officer of the Borrower certifying in reasonable detail as to
Cash on Hand measured as of the preceding Friday. The Borrower shall, by the
close of business each Wednesday, prepay the Advances in an amount equal to
the amount of Cash on Hand in excess of $5,000,000 as of the preceding Friday.
Notwithstanding anything to the contrary set forth in Section 2.06(b) or(c) of
the Credit Agreement, prepayments pursuant to this Section 3.1(b) shall be
applied, first, to prepay Amendment Period Revolving Credit Advances then
outstanding until such Amendment Period Revolving Credit Advances are paid in
full and, second, to prepay Existing Revolving Credit Advances then
outstanding until such Existing Revolving Credit Advances are paid in full.
Each of the Borrower and its Subsidiaries represents and covenants that it
owns or will own no depository accounts other than the Included Accounts and
the Excluded Accounts. Each of the Borrower and its Subsidiaries further
represents and covenants that, as of the Effective Date, the balance in the
Ispot Partnership Account is not greater than $500,000 and, as of such date,
no advances shall be made to the Ispot Partnership, no repayments of
indebtedness or intercompany payables shall be made to the Ispot Partnership
and no purchases shall be made from the Ispot Partnership except normal trade
transactions on an arms-length basis.
(c) Capital Events. The Borrower shall use its best efforts to consummate the
Type A Capital Event on or before October 31, 2001. The Borrower shall use
its best efforts to consummate the Type B Capital Event on or before February
28, 2002. It is understood that the failure to consummate the Type A Capital
Event or the Type B Capital Event by such dates shall not constitute a Default
or Event of Default.
(d) Application of Proceeds of Certain Events.
(i) Notwithstanding anything to the contrary set forth in Sections 2.06(b) or
(c) of the Credit Agreement, (A) the proceeds of the Type A Capital Event and
the Type B Capital Event, in aggregate amount up to $50,000,000, shall be
applied, first, to the prepayment of the Deferred Amounts (and to amounts to
be deferred within 30 days of the consummation of a Capital Event) and,
second, to the prepayment of the Advances in accordance with Section 2.06(c)
(i) of the Credit Agreement, and (B) the proceeds of (1) the Type A Capital
Event and the Type B Capital Event, in an aggregate amount in excess of
$50,000,000 and (2) any issuance or sale of equity securities or junior debt
securities or instruments or of any Asset Disposition (in each case, other
than in connection with the Type A Capital Event or the Type B Capital Event),
in each case, shall be applied, first, on a pro rata basis to the prepayment
in full of the Term Loan Advances and the Existing Revolving Credit Advances
then outstanding (which prepayments shall permanently reduce the Existing
Revolving Credit Commitment) until such Advances are paid in full, second, to
the prepayment of the Letter of Credit Advances then outstanding under the
Existing Revolving Credit Commitments, until all such Letter of Credit
Advances are paid in full, third, to the prepayment of the Amendment Period
Revolving Credit Advances then outstanding (which prepayments shall
permanently reduce the Amendment Period Revolving Credit Commitment) until all
such Advances are paid in full, fourth, to the prepayment of the Letter of
Credit Advances then outstanding under the Amendment Period Revolving Credit
Commitments, until all such Letter of Credit Advances are paid in full, and
fifth, by depositing such amount in the L/C Cash Collateral Account, to cash
collateralize 100% of the Available Amount of the Letters of Credit then
outstanding.
(ii) Notwithstanding anything to the contrary set forth in Section 20(b) of
the Security Agreement, all cash proceeds received in respect of any
realization upon the Collateral, after an Event of Default and upon an
acceleration of the indebtedness as a result therefrom, shall be applied,
first, to the payment in full of all Amendment Period Revolving Credit
Advances then outstanding (which prepayments shall permanently reduce the
Amendment Period Revolving Credit Commitment), second, to the prepayment of
the Letter of Credit Advances then outstanding under the Amendment Period
Revolving Credit Commitments, until all such Letter of Credit Advances are
paid in full, third, on a pro rata basis to the prepayment in full of the Term
Loan Advances and the Existing Revolving Credit Advances then outstanding
(which prepayments shall permanently reduce the Existing Revolving Credit
Commitment) until such Advances are paid in full, fourth, to the prepayment of
the Letter of Credit Advances then outstanding under the Existing Period
Revolving Credit Commitments, until all such Letter of Credit Advances are
paid in full, and fifth, by depositing such amount in the L/C Cash Collateral
Account, to cash collateralize 100% of the Available Amount of the Letters of
Credit then outstanding.
(e) Cash Management System; Certain Debits. The Borrower shall maintain its
cash management system at the Administrative Agent or otherwise pursuant to
depositary agreements in form and substance satisfactory to the Administrative
Agent. The Administrative Agent shall be entitled, upon one Business Day's
notice, to debit any operating account of the Borrower to collect costs and
expenses to which the Administrative Agent is entitled pursuant to Section
8.04 of the Credit Agreement or Sections 3.1(h) and 6.2 of this Amendment.
(f) Financial Advisor; Investment Bankers. The Borrower shall (i) at all
times continue the retention of The Recovery Group, or another financial
advisor reasonably acceptable to the Administrative Agent and the Required
Lenders (the "Financial Advisor"), (ii) until the consummation of the Type A
Capital Event, continue the retention of Veronis Suhler, or another investment
banker reasonably acceptable to the Administrative Agent and the Required
Lenders with respect to the scope of engagement set forth in that certain
engagement letter between the Borrower and Veronis Suhler dated April 11, 2001
and (iii) retain on or before August 1, 2001 and thereafter continue the
retention of an investment banker reasonably acceptable to the Administrative
Agent and the Required Lenders (the investment bankers retained pursuant to
clauses (ii) and (iii), the "Investment Bankers"). Upon request, the
Administrative Agent, the Lenders and their advisors shall be provided
reasonable access to the Financial Advisor and the Investment Bankers and
shall receive copies of all information provided to or from any of them.
(g) Mortgage Instruments; Foreign Collateral Documents; Intellectual Property
Documents. (i) As soon as possible after the Effective Date, and in no event
later than August 31, 2001, the Borrower and its Subsidiaries shall deliver to
the Administrative Agent for the ratable benefit of the Lenders (A) one or
more security agreements and guarantees duly executed by each Foreign
Subsidiary identified in Schedule 3 hereto, together with all documents and
instruments necessary to perfect the security interests granted in such
security agreements and such legal opinions as the Administrative Agent may
reasonably request (the "Foreign Collateral Documents") and (B) one or more
security agreements duly executed by the Borrower and its Subsidiaries as may
be necessary to grant the Administrative Agent for the ratable benefit of the
Lenders security interests in the Intellectual Property, together with all
documents and instruments necessary to perfect the security interests (the "IP
Collateral Documents"); and (ii) as soon as possible after the Effective Date,
and in no event later than September 28, 2001, the Borrower and its
Subsidiaries shall deliver to the Administrative Agent for the ratable benefit
of the Lenders fully executed and notarized mortgages, deeds of trust or deeds
to secure debt, as applicable (the "Mortgage Instruments"), with respect to
the Real Property. The Mortgage Instruments, the Foreign Collateral Documents
and the IP Collateral Documents shall be in form and substance satisfactory to
the Administrative Agent and the Required Lenders.
(h) Administrative Agent's Advisors. The Borrower shall cooperate in all
respects with any financial advisor retained by the Administrative Agent and
shall pay or reimburse the Administrative Agent for all reasonable fees and
out-of-pocket expenses incurred in connection therewith.
(i) Phase III Report. The Borrower shall deliver to the Administrative Agent
and the Lenders, as soon as available, but in any event not later than August
31, 2001, a written report describing in detail the initiatives to be
considered in "Phase III" as described in the Borrower's presentation to the
Lenders dated May 22, 2001 (the "Phase III Report"). The Phase III Report
shall be in form and substance satisfactory to the Administrative Agent and
the Required Lenders. Promptly following the delivery of the Phase III
Report, the Borrower and the Financial Advisor shall, from time to time at the
request of the Administrative Agent, consult with the Administrative Agent,
the Lenders and their advisors with regard to all aspects of the
implementation of the Phase III initiatives. The Borrower shall use best
efforts to implement the Phase III initiatives as soon as practicable. The
Borrower and the Financial Advisor shall participate on bi-weekly (or more
frequently as the Administrative Agent shall request) conference calls with
the Administrative Agent and its advisors regarding the analysis and
implementation of the Phase III initiatives.
(j) Business Plan. The Borrower shall deliver to the Administrative Agent and
the Lenders on or before October 31, 2001 a detailed business plan which plan
shall be prepared on a "bottom-up" basis for each of the operating divisions
of the Borrower (and reflecting, in particular, the operations of each
business unit of each such operating division) (the "Business Plan"). The
Business Plan shall identify and reflect the timing of the implementation of
the "Phase III" action items and shall include, on a monthly basis, for the
fifteen month period beginning October 1, 2001, (i) profit and loss
statements, (ii) balance sheets, (iii) consolidated forecasts detailing cash
flow and collateral levels. The Business Plan shall identify, among other
things, (x) all sources of revenue and expenses, including without limitation,
intended executive compensation and (y) the nature of all proposed Capital
Expenditures. The Business Plan shall be in form and substance satisfactory
to the Administrative Agent.
Section 3.2. Agreements Deemed Agreements under the Credit Agreement. For
purposes of the Credit Agreement, the agreements of the Borrower contained in
this Article III shall be deemed to be, and shall be, agreements under the
Credit Agreement. Any breach on the part of the Borrower in respect of any
agreement contained in Sections 3.1(a), (b), (g), (i) or (j) shall constitute
an Event of Default.
ARTICLE IV
EFFECTIVE DATE
Section 4.1. Effective Date. This Amendment shall become effective as of the
date hereof upon receipt by the Administrative Agent of the following:
(a) counterparts of this Amendment, duly executed and delivered by the
Borrower, each of the Subsidiaries listed on the signature pages hereto, the
Administrative Agent and the Lenders;
(b) that portion of the Amendment Fee due on the Effective Date, along with
the reasonable fees and disbursements of the Administrative Agent's
professionals that have been invoiced as of July 27, 2001;
(c) evidence that outstanding Revolving Credit Advances shall not be greater
than $51,000,000;
(d) a copy of the 2001 Forecast;
(e) such legal opinions (including opinions from counsel to the Borrower and
its Subsidiaries and from such local counsel as may be required by the
Administrative Agent), documents, and instruments as are customary for
transactions of this type or as the Administrative Agent or any Lender may
reasonably request;
(f) a guaranty supplement duly executed by each Domestic Subsidiary identified
in Schedule 3 hereto, in form and substance substantially similar to that set
forth in Exhibit C to this Amendment;
(g) a security agreement supplement duly executed by each Domestic Subsidiary
identified in Schedule 3 hereto, in form and substance substantially similar
to that set forth in Exhibit D to this Amendment, together with all documents
and instruments necessary to perfect the security interests granted in such
security agreements; and
(h) as may be requested by the Administrative Agent, certified copies of the
charter and by-laws (or equivalent documents), of each Subsidiary identified
in Schedule 3 hereto and of all corporate authority for each such Subsidiary
(including, without limitation, board of director resolutions and evidence of
the incumbency of officers) with respect to the execution, delivery and
performance of each Loan Document to which such Subsidiary is intended to be a
party and each other document to be delivered by such Subsidiary from to time
in connection herewith and with the extensions of credit under the Credit
Agreement (and the Administrative Agent and each Lender may conclusively rely
on such certificate until it receives notice in writing from such Subsidiary
to the contrary).
ARTICLE V
INTERPRETATION
Section 5.1. Continuing Effect of the Credit Agreement. The Borrower, the
Administrative Agent and each Lender hereby acknowledges and agrees that the
Credit Agreement shall continue to be and shall remain unchanged and in full
force and effect in accordance with its terms, except as expressly modified
hereby. Any terms or conditions contained in this Amendment shall control
over any inconsistent terms or conditions in the Credit Agreement or the other
Loan Documents.
Section 5.2. No Waiver. Nothing contained in this Amendment shall be
construed or interpreted or is intended as a waiver of any Default or Event of
Default or of any rights, powers, privileges or remedies that the
Administrative Agent or the Lenders have or may have under the Credit
Agreement, any other related document or applicable law on account of such
Default or Event of Default.
ARTICLE VI
MISCELLANEOUS
Section 6.1. Representations and Warranties. The Borrower hereby represents
and warrants as of the date hereof that, after giving effect to this
Amendment, (a) no Default or Event of Default has occurred and is continuing,
and (b) all representations and warranties of the Borrower contained in the
Credit Agreement are true and correct in all material respects on and as of
the date hereof (or if any such representation or warranty is expressly stated
to have been made as of a specific date, as of such specific date).
Section 6.2. Fees and Expenses.
(a) The Borrower agrees to pay to the Administrative Agent on demand all
reasonable expenses including reasonable attorney's fees and expenses of the
Administrative Agent, incurred by the Administrative Agent, in connection with
the preparation, negotiation and execution of this Fifth Amendment.
(b) The Borrower shall pay to the Administrative Agent, for the account of
each Lender on a pro rata basis, an amendment fee (the "Amendment Fee")
payable as follows: (i) $2,000,000 in cash on the Effective Date, (ii)
$500,000 in cash on November 1, 2001 only in the event the Borrower shall have
failed to achieve the Documentation Benchmark with respect to the Type A
Capital Event on or before October 31, 2001, (iii) $1,000,000 in cash on
January 15, 2003 in the event that (A) the Borrower shall have failed to
consummate the Type A Capital Event on or before December 31, 2001 and (B) the
Borrower shall not have paid in full, in cash, all Obligations owing to the
Administrative Agent and the Lenders under the Credit Agreement on or before
January 15, 2003, (iv) $500,000 in cash on March 1, 2002 in the event the
Borrower shall have failed to achieve the Documentation Benchmark with respect
to the Type B Capital Event on or before February 28, 2002 and (v) in addition
to any fee owing pursuant to clause (iii) above, $1,000,000 in cash on January
15, 2003 in the event that (A) the Borrower shall have failed to consummate
the Type B Capital Event on or before April 30, 2002 and (B) the Borrower
shall not have paid, in full, in cash, all Obligations owing to the
Administrative Agent and the Lenders under the Credit Agreement on or before
January 15, 2003. The Amendment Fee shall be deemed earned in full on the
Effective Date.
Section 6.3. Warrants. In the event the Borrower shall have failed to
achieve the Documentation Benchmark with respect to the Type A Capital Event
on or before December 31, 2001, the Borrower shall issue to the Lenders, on
January 1, 2002, detachable and freely transferable five year Warrants for the
purchase of common stock of the Borrower representing in the aggregate 5% of
the fully diluted common stock upon the Effective Date; provided, however,
that in the event the Borrower shall have consummated the Type A Capital Event
on or before February 28, 2002, such Warrants shall be cancelled. In addition
to any Warrants issued pursuant to the preceding sentence, in the event the
Borrower shall have failed to achieve the Documentation Benchmark with respect
to the Type B Capital Event on or before April 30, 2002, the Borrower shall
issue to the Lenders, on May 1, 2002, Warrants representing in the aggregate
5% of the fully diluted common stock upon the Effective Date; provided,
however, that in the event the Borrower shall have consummated the Type B
Capital Event on or before June 30, 2002, such Warrants shall be cancelled.
All such Warrants would be exercisable on the earlier of (i) the fifth
anniversary of the issuance thereof or (ii) upon the occurrence of an Event of
Default at a nominal strike price.
Section 6.4. Confirmation of Indebtedness. The Borrower and the Subsidiary
Guarantors hereby confirm and acknowledge that, as of the Effective Date, (i)
the Borrower is truly and justly indebted to the Lenders, without defense,
counterclaim or offset of any kind, (ii) the Borrower is liable to the Lenders
in respect of Advances made under the Credit Agreement, as of July 24, 2001,
in the aggregate principal amount of $250,635,275.34 (exclusive of Letters of
Credit) and (iii) each Subsidiary Guarantor is contingently liable to the
Lenders in respect of such amount.
Section 6.5. Counterparts. This Amendment may be executed by the parties
hereto in any number of separate counterparts, and all of said counterparts
taken together shall be deemed to constitute one and the same instrument.
Section 6.6. GOVERNING LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT
GIVING EFFECT TO ITS CONFLICTS OF LAW PRINCIPLES).
Section 6.7. Reservation of Rights. Notwithstanding anything contained in
this Amendment, the Borrower acknowledges that the Administrative Agent and
the Lenders do not waive, and expressly reserve, the right to exercise, at any
time, any and all of their rights and remedies under the Credit Agreement, any
other related document and applicable law on account of any Default or Event
of Default.
Section 6.8. Waiver. The Loan Parties hereby release, waive, and forever
relinquish all claims, demands, obligations, liabilities and causes of action
of whatever kind or nature, whether known or unknown, which any of them has,
may have, or might assert at the time of execution of this Amendment or in the
future against the Administrative Agent, the Lenders and/or their respective
parents, affiliates, participants, officers, directors, employees, agents,
attorneys, accountants, consultants, successors and assigns (collectively, the
"Lender Group"), directly or indirectly, which occurred, existed, was taken,
permitted or begun prior to the execution of this Amendment, arising out of,
based upon, or in any manner connected with (i) any transaction, event,
circumstance, action, failure to act or occurrence of any sort or type,
whether known or unknown, with respect to the Credit Agreement, any other Loan
Document and/or the administration thereof or the obligations created thereby,
(ii) any discussions, commitments, negotiations, conversations or
communications with respect to the refinancing, restructuring or collection of
any obligations related to the Credit Agreement, any other Loan Document and/
or the administration thereof or the obligations created thereby, or (iii) any
matter related to the foregoing.
Section 6.9. Consents. Each of the Administrative Agent and each Lender
hereby consents to (a) the DPG Sale for aggregate net cash consideration in an
amount not less than fair market value, and (b) the release by the
Administrative Agent of (i) all security interests held by it for the benefit
of the Lenders in the assets and/or stock that are the subject of the DPG Sale
and (ii) Portal Publications, Ltd. and its Subsidiaries from their obligations
under the Subsidiary Guaranty.
Section 6.10. Fuji Letter. The Borrower and each Lender hereby agree that,
as of the Effective Date, that certain letter agreement, dated December 8,
2000, from Fleet National Bank, as Administrative Agent and Lender, to Applied
Graphics Technologies, Inc., shall be of no further force or effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered by their proper and duly authorized officers as of the
date first above written.
APPLIED GRAPHICS TECHNOLOGIES, INC.
By: ___________________________________
Title:
MIRAMAR EQUIPMENT, INC.
DEVON GROUP, INC.
BLACK DOT GRAPHICS, INC.
ORENT GRAPHICARTS, INC.
TYPO-GRAPHICS, INC.
AMBROSI & ASSOCIATES, INC.
WEST COAST CREATIVE, INC.
ABD GROUP, INC.
MERIDIAN RETAIL, INC.
TAPROOT INTERACTIVE, INC.
PROOF POSITIVE/FARROWLYNE
ASSOCIATES, INC.
ONE 2 ONE, INC.
PORTAL PUBLICATIONS, LTD.
THE WINN ART GROUP, LTD.
COLOR CONTROL, INC.
AGILE ENTERPRISE, INC.
AGT SYSTEM SERVICES, INC.
RETAIL PROFIT SOLUTIONS, INC.
By: ___________________________________
Title:
FLEET NATIONAL BANK, as Administrative Agent
By: ___________________________________
Title:
FLEET NATIONAL BANK, as a Lender, Issuing Bank
and Swing Line Bank
By: ___________________________________
Title:
BANK OF AMERICA, N.A., as a Lender
By: ___________________________________
Title:
FIRST UNION NATIONAL BANK, N.A. , as a Lender
By: ___________________________________
Title:
THE CHASE MANHATTAN BANK, as a Lender
By: ___________________________________
Title:
THE BANK OF NEW YORK, as a Lender
By: ___________________________________
Title:
SOVEREIGN BANK, as a Lender
By: ___________________________________
Title:
MELLON BANK, N.A. , as a Lender
By: ___________________________________
Title:
SUNTRUST BANK, N.A. , as a Lender
By: ___________________________________
Title:
CITIZENS BANK OF MASSACHUSETTS, as a Lender
By: ___________________________________
Title:
THE BANK OF NOVA SCOTIA, as a Lender
By: ___________________________________
Title:
BHF (USA) CAPITAL CORPORATION, as a Lender
By: ___________________________________
Title:
By: ___________________________________
Title:
Schedule 1
REAL PROPERTY
1. Property located at 225 West Superior Street, Chicago, Illinois 60610
owned by WUSA RE, Inc.
2. Property located at 114 S. Racine Street, Chicago, Illinois 60607
owned by Ambrosi & Associates, Inc.
3. Property located at 113 N. May Street, Chicago, Illinois 60607 owned
by Ambrosi & Associates, Inc.
4. Property located at 6120 Factory Road, Crystal Lake, Illinois 60039
owned by Black Dot Graphics, Inc.
5. Property located at 6210 Factory Road, Crystal Lake, Illinois 60039
owned by Black Dot Graphics, Inc.
6. Property located at 6209 Official Road, Crystal Lake, Illinois 60039
owned by Black Dot Graphics, Inc.
7. Property located at 6115 Official Road, Crystal Lake, Illinois 60039
owned by Black Dot Graphics, Inc.
8. Property located at 1001 W. North Street, Pontiac, Illinois 61764
owned by AGT.
9. Property located at 2000 Judson, Lincoln, Nebraska 68521 owned by
Orent Graphic Arts, Inc.
10. Property located at 4805 G Street, Omaha, Nebraska 68117 owned by
Orent Graphic Arts, Inc.
11. Property located at 2602 East Livingston Street, Orlando, Florida
32803 owned by Typo-Graphics, Inc.
12. Property located at 3820 150 Avenue NE, Redmond, Washington 98052
owned by Color Control, Inc.
13. Property located at 3116 West Avenue 32, Los Angeles, California
90065 owned by AGT.
14. Property located at 201 Alameda del Prado, Novato, California owned by
Portal Publications, Inc.
Schedule 2
INTELLECTUAL PROPERTY
Patents and Patent Applications
1. Appartatus and Method for Processing Images Using a Reciprocating
Easel, US Patent Serial Number 08/708,751.
2. Appartatus and Method for Processing Images Using a Reciprocating
Easel, Patent Cooperation Treaty Application No. PCT/US97114999.
Trademarks and Trademark Applications
1. AGT
2. Applied Graphics Technologies
3. APT
4. APT (stylized)
5. Applied Printing Technologies
6. ArtOnCall
7. ArtOnCall and design
8. Digital Link
9. Digital Originals
10. Gore Graphics
11. Gore Graphics and design
12. Spotlink
13. Black Dot (stylized)
14. Black Dot Group
15. Customizing Your Cultural Experience
16. Digizine and design
17. Digizine (stylized)
18. Seven and Penguin design (pending)(1)
19. Seven and Lightbulb design
20. Seven and Zebra design
21. Seven and Strawberry design
22. Seven
23. Seven and Fish design
24. Seven and Knife design
25. Seven and Marble design
26. Wace USA
27. The Image Network
28. G.S. Imaging Services
29. GS (stylized)
30. Hexagon design
31. Jahn & Ollier
32. Pleasing Colour
33. Techtron and design
34. Techtron Imaging Network
35. Digizine (Australia)
36. Digital Link (Canada)
37. Digizine (Canada)
38. ArtOnCall and design (EC)
39. Digizine (EC)
40. Digital Link (Germany)
41. Digital Link (Israel)
42. Digizine (Japan)
43. Digital Link (Mexico)
44. Digitizine (Mexico)
45. Digizine (New Zealand)
46. Digital Link (Norway)
47. Digizine (Singapore)
48. Digital Link (Sweden)
49. 8 marks of Seven (listed as items 18-25 of this schedule) filed with
the EC trademark office (pending)(2)
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(1) Penguin Books has filed a challenge with the PTO with respect to the use
of this mark.
(2) ProsibenSAT Gmbh is challenging these marks.
Schedule 3
JOINING SUBSIDIARIES
1. Seven Worldwide, Inc.
2. WUSA Re, Inc.
3. R.E. Graphics, Inc.
4. Applied Graphics Technologies (UK) Limited
5. Devon Publishing Limited
6. Portal Aird Publications Pty., Ltd.
7. Seven Australia Pty. Limited
8. Canadian Art Prints, Inc.
9. Seven Sydney Pty., Ltd.
EXHIBIT A TO THE
FIFTH AMENDMENT
Schedule I-
COMMITMENTS
Lender Tranche A Tranche B Tranche C
Term Loan Term Loan Term Loan
Commitment Commitment Commitment
Fleet National Bank $10,256,183 $56,864,066 $40,983,619
Bank of America $10,939,928
First Union Nat'l Bank $9,116,607
The Chase Manhattan Bank $9,116,607
The Bank of New York $9,116,607
Sovereign Bank $7,293,286
Mellon Bank $5,469,964
Suntrust Bank $5,469,964
Citizens Bank $5,469,964
The Bank of Nova Scotia $3,3646,643
BHF(USA) Capital $6,153,710 $4,610,600
Lender Swing Line Letter of Existing
Commitment Credit Revolving
Commitment Credit
Commitments
Fleet National Bank $5,000,000 $10,000,000 $10,189,800
Bank of America $6,793,200
First Union Nat'l Bank $5,661,000
The Chase Manhattan Bank $5,611,000
The Bank of New York $5,611,000
Sovereign Bank $4,528,800
Mellon Bank $3,396,600
Suntrust Bank $3,396,600
Citizens Bank $3,396,600
The Bank of Nova Scotia $2,264,400
BHF(USA) Capital
Lender Additional Total
Revolving Revolving
Credit Credit
Commitments Commitments
Fleet National Bank $6,010,200 $16,200,000
Bank of America $4,006,800 $10,800,000
First Union Nat'l Bank $3,339,000 $9,000,000
The Chase Manhattan Bank $3,339,000 $9,000,000
The Bank of New York $3,339,000 $9,000,000
Sovereign Bank $2,671,200 $7,200,000
Mellon Bank $2,003,400 $5,400,000
Suntrust Bank $2,003,400 $5,400,000
Citizens Bank $2,003,400 $5,400,000
The Bank of Nova Scotia $1,335,600 $3,600,000
BHF(USA) Capital
EXHIBIT B TO THE
FIFTH AMENDMENT
FORM OF BORROWING BASE CERTIFICATE
________, ___
Fleet National Bank,
as Administrative Agent
777 Main Street
Hartford, CT 06115
Attention: Ralph C. Palma
This Certificate is delivered pursuant to the provisions of the Amended and
Restated Credit Agreement, dated as of March 10, 1999 (as amended,
supplemented or otherwise modified, the "Credit Agreement") among Applied
Graphics Technologies, Inc. (the "Borrower"), the several banks and other
financial institutions from time to time party to the Credit Agreement (the "
Lenders") and Fleet National Bank (the "Administrative Agent"). Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned to such terms in the Credit Agreement.
The undersigned hereby certifies that (s)he is an officer of the Borrower and
that, as such, is authorized to execute this Certificate on behalf of the
Borrower and further certifies that:
(a) for purposes of this Certificate, the date of determination of the
Borrowing Base is ______, _____ and
(b) the amounts set forth below are a true and correct statement of the
calculation of the Borrowing Base in accordance with the provisions of the
Credit Agreement.
Gross Receivables
Accounts excluded from Eligible Receivables:
1. accounts owing from account debtors located outside of the
United States
2. accounts that are not assignable or for which a first priority
security interest in such account in favor of the Administrative Agent
for the benefit of the Lenders has not been obtained and fully
perfected
3. accounts subject to any Lien, other than (i) Liens in favor of
the Administrative Agent for benefit of the Lenders and (ii) such other
Liens described in clause (i) of the definition of Permitted Liens
4. accounts that do not constitute a legal, valid and binding
irrevocable payment obligation of the account debtor to pay the balance
thereof in accordance with its terms or is subject to any asserted or
contractual defense, setoff, recoupment or counterclaim
5. accounts of the Borrower's Publishing Division (e.g., Portal
Publications Ltd. and its Subsidiaries)
6. accounts of the Borrower's Broadcast Division
7. accounts for which the account debtor has not been sent an
invoice
8. accounts more than 90 days from invoice date
9. accounts from any account debtor which has filed a petition
for relief under the United States Bankruptcy Code (or similar action
under any successor law or under any comparable law), made a general
assignment for the benefit of creditors, had filed against it any
petition or other application for relief under the United States
Bankruptcy Code (or similar action under any successor law or under any
comparable law), called a meeting of its creditors for the purpose of
obtaining any financial concession or accommodation, or had or suffered
a receiver or a trustee to be appointed for all or a significant
portion of its assets or affairs, or, to the knowledge of the Borrower
or any of its Subsidiaries, is otherwise winding up its affairs or has
become insolvent; provided, however, that Eligible Accounts shall
include accounts from any account debtor that either (A) relate to
periods following the filing of a petition for relief under the United
States Bankruptcy Code with respect to such account debtor (except
accounts from any account debtor whose case is converted post-petition
to a case under Chapter 7 of the United States Bankruptcy Code pursuant
to (S)706 thereof) or (B) the payment of which has been approved by
final order of a United States Bankruptcy Court
10. accounts that have been placed with an attorney or other third
party for collection
11. accounts from affiliates or Subsidiaries of the Borrower or any
of its Subsidiaries (except, for purposes of this item 11 only,
accounts from U.S. News & World Report, L.P., Daily News, L.P. and
Applied Printing Technologies, L.P.; provided, however, accounts from
such affiliates shall be reduced to the extent that the Borrower or any
of its Domestic Subsidiaries are liable for goods sold or services
rendered by such affiliates)
12. accounts from employees or directors of the Borrower or any of
its Subsidiaries
13. accounts from any account debtor from whom 30% or more of the
account balance is past 90 days from invoice date before giving effect
to credit-related charge-offs (i.e., excluding normal documented credit
memos or discounts issued in the ordinary course of business) made
during the period 60 days ending on the date of determination
14. accounts with respect to which the Borrower or any of its
Subsidiaries have not complied with all material requirements of law
applicable to such account or affecting the collectability of such
account
Eligible Receivables:
Offset Amount for such date: the greater of (i) $250,000 and (ii) an
amount equal to (A) 1.5 multiplied by (B) an amount equal to the lesser
of, with respect to each account debtor (x) the aggregate amount of
Receivables payable to the Borrower or any of its Domestic Subsidiaries
from account debtors (other than U.S. News & World Report, L.P., Daily
News, L.P. and Applied Printing Technologies, L.P.) to which the
Borrower or any of its Domestic Subsidiaries are liable for goods sold
or services rendered by such account debtors and (y) the aggregate
amount for which the Borrower or any of its Domestic Subsidiaries are
liable to such account debtors.
Less any reasonable reserves established by the Administrative Agent
from time to time:
Borrowing Base for such date: 80% of Eligible Receivables, less 80% of
the Offset Amount for such date, less any reasonable reserves
established by the Administrative Agent from time to time:
Aggregate Outstanding Amount of Amendment Period Revolving Credit
Advances:
Excess (Deficit):
IN WITNESS WHEREOF, I have hereto executed this certificate on behalf of the
Borrower:
Name:
Title:
EXHIBIT C TO THE
FIFTH AMENDMENT
FORM OF GUARANTY SUPPLEMENT
______________, ____
Fleet National Bank, as Administrative Agent
777 Main Street
Hartford, CT 06115
Attention: Ralph C. Palma
Amended and Restated Credit Agreement, dated as of March 10, 1999, among
Applied Graphics Technologies, Inc., a Delaware corporation (the "Borrower"),
the Lenders party thereto, and Fleet National Bank (formerly known as
BankBoston, N.A.)., as Initial Issuing Bank, as Swing Line Bank and as
Administrative Agent (as amended, the "Credit Agreement")
Ladies and Gentlemen:
Reference is made to the above-defined Credit Agreement and to the Guaranty
referred to therein (such Guaranty, as in effect on the date hereof and as it
may hereafter be amended, modified, restated or supplemented from time to
time, the "Guaranty"). Capitalized terms used and not otherwise defined
herein have the meanings ascribed to them in the Guaranty.
The undersigned hereby jointly and severally, unconditionally and irrevocably
guarantees the punctual payment when due, whether at stated maturity, by
acceleration or otherwise, of all of the Guaranteed Obligations and agrees to
pay any and all reasonable expenses (including reasonable counsel fees and
expenses) incurred by the Administrative Agent or any other Secured Party on
the terms set forth in the Guaranty as if it were an original party thereto.
On and after the date hereof, each reference in the Guaranty to "Guarantor"
shall also mean and be a reference to the undersigned.
The undersigned hereby agrees to be bound as a Guarantor by all of the terms
and provisions of the Guaranty to the same extent as each other Guarantor.
THIS GUARANTY SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS CONFLICT
OF LAWS PRINCIPLES).
THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE, IN EQUITY OR AT LAW) ARISING OUT OF THE LOAN DOCUMENTS, THE
TRANSACTIONS CONTEMPLATED THEREBY OR THE ACTIONS OF ANY SECURED PARTY IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
Very truly yours,
(ADDITIONAL GRANTOR)
By: ______________________________
Title: _____________________________
Address: __________________________
__________________________
EXHIBIT D TO THE
FIFTH AMENDMENT
FORM OF SECURITY AGREEMENT SUPPLEMENT
______________, ____
Fleet National Bank, as Administrative Agent
777 Main Street
Hartford, CT 06115
Attention: Ralph C. Palma
Security Agreement, dated as of June 3, 1999, made by Applied Graphics
Technologies, Inc. and the other Grantors party thereto, to Fleet National
Bank (formerly known as BankBoston, N.A.), as Administrative Agent for the
Secured Parties
Ladies and Gentlemen:
Reference is made to the above-captioned Security Agreement (such Security
Agreement, as in effect on the date hereof and as it may hereafter be amended,
supplemented, restated, or otherwise modified from time to time, the "Security
Agreement"). Capitalized terms used and not otherwise defined herein have the
meanings ascribed to them in the Security Agreement.
The undersigned hereby agrees, as of the date first above written, to become a
Grantor under the Security Agreement as if it were an original party thereto
and agrees that each reference in the Security Agreement to "Grantor" shall
also mean and be a reference to the undersigned.
The undersigned hereby assigns and pledges to the Administrative Agent, for
the benefit of the Administrative Agent and the ratable benefit of the
Lenders, the Swing Line Bank and the Issuing Bank, and hereby grants to the
Administrative Agent, for the benefit of the Administrative Agent and the
ratable benefit of the Secured Parties, as security for the Secured
Obligations, a lien on, and security interest in, all of the right, title and
interest of the undersigned, whether now owned or hereafter acquired, in and
to the Collateral owned by the undersigned, including, but not limited to, the
property listed on the attached supplements to Schedules I through III to the
Security Agreement. The undersigned hereby certifies that such supplements
have been prepared by the undersigned in substantially the form of such
Schedules and are true, accurate and complete as of the date hereof.
The undersigned hereby makes each representation and warranty set forth in
Section 8 of the Security Agreement (as modified by the attached supplements
to the Schedules to the Security Agreement) to the same extent as each other
Grantor and hereby agrees to be bound as a Grantor by all of the terms and
provisions of the Security Agreement to the same extent as each other Grantor.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS CONFLICTS OF LAWS
PROVISIONS).
THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF THE LOAN DOCUMENTS (AS DEFINED IN THE CREDIT
AGREEMENT), THE TRANSACTIONS CONTEMPLATED THEREBY OR THE ACTIONS OF THE
ADMINISTRATIVE AGENT, ANY L
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