View:
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
-----------------------
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): September 29, 1994
VIACOM INC.
--------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-9553 04-2949533
----------------- ---------------- ----------------
(State or (Commission File (I.R.S. Employer
other Number) Identification
jurisdiction No.)
of Incorporation)
200 Elm Street, Dedham, Massachusetts 02026
------------------------------------- ------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 461-1600
Page 1 of [ ] Pages
Exhibit Index Appears on Page [ ]
Item 5. Other Events.
----------------------
On September 29, 1994, Blockbuster Entertainment
Corporation, a Delaware corporation ("Blockbuster"), was merged
(the "Merger") with and into Viacom Inc., a Delaware corporation
("Viacom"), pursuant to the Agreement and Plan of Merger dated as
of January 7, 1994, as amended as of June 15, 1994 (the "Merger
Agreement"). The Merger Agreement is incorporated herein by
reference to Exhibit 2.1 to the Registration Statement on Form S-4
(No. 33-55271) filed by Viacom with the Securities and Exchange
Commission on August 29, 1994. The Merger was approved by the
stockholders of Blockbuster and Viacom at special meetings held
on September 29, 1994. Pursuant to the Merger Agreement, each
share of Common Stock (other than shares held by Viacom,
Blockbuster and, if appraisal rights are available under the
Delaware General Corporation Law, those holders who have demanded
and perfected appraisal rights) has been cancelled and converted
into the right to receive (i) 0.08 of a share of Class A Common
Stock, par value $.01 per share, of Viacom, (ii) 0.60615 of a
share of Class B Common Stock, par value $.01 per share, of
Viacom ("Viacom Class B Common Stock") and (iii) up to an
additional 0.13829 of a share of Viacom Class B Common Stock,
with such number of shares depending on market prices of Viacom
Class B Common Stock during the year following the effective time
of the Merger, evidenced by one variable common right of Viacom.
A copy of the press release dated September 29, 1994 announcing
approval of the Merger Agreement by Blockbuster's stockholders
and Viacom's stockholders and completion of the Merger is filed
as Exhibit 99.1 hereto and is incorporated by reference herein.
In connection with the consummation of the Merger, Viacom
entered into a $1.8 billion senior unsecured eight-year reducing
revolving credit agreement (the "Credit Agreement") with the
banks party thereto, The Bank of New York, as a Managing Agent
and as the Documentation Agent, Citibank, N.A., as a Managing
Agent and as the Administrative Agent, Morgan Guaranty Trust
Company of New York, as a Managing Agent, JP Morgan Securities
Inc., as the Syndication Agent, The Bank of America NT&SA ("BA"),
as a Managing Agent, and the banks named as Agents therein.
Borrowings under the Credit Agreement were used to refinance
certain existing indebtedness of Blockbuster under (i) the
$1,000,000,000 Amended and Restated Credit Agreement dated as of
December 22, 1993 among Blockbuster, certain of Blockbuster's
subsidiaries, BA, as Agent, BA Securities Inc., as Arranger, and
the other financial institutions party thereto; (ii) the
$1,000,000,000 Credit Agreement dated as of February 15, 1994
among Blockbuster, BA, as Agent, BA Securities Inc., as Arranger,
and the other financial institutions party thereto; and (iii) the
$250,000,000 Credit Agreement dated as of September 8, 1994
between Blockbuster and NationsBank of Florida, N.A. The Credit
Agreement will also be available for general corporate purposes.
The Credit Agreement will mature on July 1, 2002. A copy of the
Credit Agreement is filed as Exhibit 99.2 hereto and is
incorporated by reference herein.
The obligations of Viacom under the Credit Agreement are
guaranteed by Viacom International Inc. and Paramount Communications
Inc. Copies of the guarantees of Viacom International Inc. and
Paramount Communications Inc. with respect to the Credit Agreement
are filed as Exhibits 99.3 and 99.4 hereto, respectively, and are
incorporated by reference herein.
List of Exhibits.
-----------------
Exhibit
-------
Number Description
------ -----------
99.1 Press release of Viacom Inc., dated September 29, 1994.
99.2 Credit Agreement, dated as of September 29, 1994,
among Viacom Inc., the Banks party thereto, The Bank
of New York, as a Managing Agent and as the
Documentation Agent, Citibank, N.A., as a Managing
Agent and as the Administrative Agent, Morgan Guaranty
Trust Company of New York, as a Managing Agent, JP
Morgan Securities Inc., as the Syndication Agent, The
Bank of America NT&SA, as a Managing Agent, and the
Banks named as Agents therein.
99.3 Guarantee, dated as of September 29, 1994, made by
Paramount Communications Inc.
99.4 Guarantee, dated as of September 29, 1994, made by
Viacom International Inc.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
VIACOM INC.
Registrant
Date: September 29, 1994 By: /s/ Philippe P. Dauman
---------------------------
Title: Executive Vice President,
General Counsel, Chief
Administrative Officer and
Secretary
EXHIBIT INDEX
-------------
Exhibit No. Description Page
- ----------- ----------- ----
99.1 Press release of Viacom Inc., dated September 29, 1994.
99.2 Credit Agreement, dated as of September 29, 1994, among
Viacom Inc., the Banks party thereto, The Bank of New
York, as a Managing Agent and as the Documentation
Agent, Citibank, N.A., as a Managing Agent and as the
Administrative Agent, Morgan Guaranty Trust Company of
New York, as a Managing Agent, JP Morgan Securities
Inc., as the Syndication Agent, The Bank of America
NT&SA, as a Managing Agent, and the Banks named as
Agents therein.
99.3 Guarantee, dated as of September 29, 1994, made by
Paramount Communications Inc.
99.4 Guarantee, dated as of September 29, 1994, made by
Viacom International Inc.
News from VIACOM
VIACOM COMPLETES MERGER WITH BLOCKBUSTER
--Combined Company Has Capitalization of $26 Billion--
New York, New York, September 29, 1994 -- Viacom Inc. (AMEX: VIA
and VIAB) and Blockbuster Entertainment Corporation (NYSE: BV)
have completed their merger, it was announced today by Sumner M.
Redstone, Chairman of the Board, and Frank J. Biondi, Jr.,
President and Chief Executive Officer, of Viacom.
As previously announced, H. Wayne Huizenga, former Chairman of
the Board and Chief Executive Officer of Blockbuster, has been
named Vice Chairman of Viacom, as well as Chairman of a newly
formed unit of the Company, the Blockbuster Entertainment Group.
Steven R. Berrard, formerly Vice Chairman, President and Chief
Operating Officer of Blockbuster, will serve as President and
Chief Executive Officer of the Blockbuster Entertainment Group.
The merger was approved by holders of Viacom Class A Common Stock
and stockholders of Blockbuster at Viacom's Special Meeting of
Stockholders held today in New York City and Blockbuster's
Special Meeting of Stockholders held today in Fort Lauderdale,
Florida. A total of 50,726,022 shares, or 95%, of the
outstanding Viacom Class A shares, approved the merger. A total
of 147,122,912 shares, or 57.7%, of the outstanding Blockbuster
shares, approved the merger.
In making the announcement, Mr. Redstone said, "With the
completion of Viacom's merger with Blockbuster, we have created a
single, incomparable, global media colossus. The new Viacom not
only controls many of the world's most valuable and recognizable
entertainment and publishing brands, but also has the
distribution, size and scope to drive these brands into every
region of the world. With pro forma combined capitalization of
$26 billion at June 30, 1994, Viacom is positioned to become the
fastest growing media company in the world."
Mr. Biondi said, "We are moving aggressively to consolidate
Viacom and Blockbuster, implement new cross-divisional projects
at our existing operations, and capitalize on new opportunities -
- just as we did immediately following our acquisition of
Paramount. In addition, one of our highest priorities will be to
continue with our financial restructuring program to reduce the
cost of our debt and enhance our financial flexibility, thereby
enabling us to reinvest in the continued expansion of our core
business."
Mr. Huizenga said, "The completion of this merger creates an
array of new opportunities for Blockbuster's businesses. Our
operations -- and the talented people behind them -- are now part
of one of the world's largest and most successful entertainment
companies. As members of the Viacom family, they will now have
the chance to expand in new directions and strengthen the
Blockbuster brand in the growing global entertainment
marketplace."
Mr. Berrard said, "Viacom and Blockbuster share remarkably
similar histories -- both are companies with entrepreneurial
spirit, creative management teams, a commitment to excellence and
exceptional financial track records. Today marks the beginning
of an exciting new era, one which we firmly believe will yield
even greater achievements."
As a result of the merger, each share of Blockbuster stock has
been converted into the right to receive 0.08 of a share of
Viacom Class A Common Stock, 0.60615 of a share of Viacom Class B
Common Stock, and one variable common right (VCR). Each VCR will
represent the right to receive up to an additional 0.13829 of a
share of Viacom Class B Stock, depending upon market prices of
Viacom Class B Common Stock during the period until September 29,
1995.
Viacom Inc. is one of the world's largest entertainment and
publishing companies and a leading force in nearly every segment
of the international media marketplace. The operations of Viacom
include Blockbuster Music; Blockbuster Video; MTV Networks;
Paramount Parks; Paramount Pictures; Paramount Television;
Showtime Networks Inc.; Simon & Schuster; Viacom Interactive
Media; cable systems serving 1.1 million customers; movie screens
in 11 countries; 14 radio stations; 12 television stations; and
majority interests in Spelling Entertainment Group and Discovery
Zone. National Amusements, Inc., a closely held corporation
which owns and operates more than 850 movie screens in the U.S.
and the U.K., is the parent company of Viacom Inc.
# # #
Contact: Carl Folta Hilary Condit
212/258-6352 212/258-6346
============================================================
$1,800,000,000
CREDIT AGREEMENT,
dated as of
September 29, 1994,
among
VIACOM INC.,
as Borrower,
-----------
THE BANKS NAMED HEREIN,
as Banks,
--------
THE BANK OF NEW YORK,
CITIBANK, N.A.,
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK,
and
BANK OF AMERICA NT&SA,
as Managing Agents,
------------------
THE BANK OF NEW YORK,
as the Documentation Agent,
--------------------------
CITIBANK, N.A.,
as the Administrative Agent,
---------------------------
JP MORGAN SECURITIES INC.,
as the Syndication Agent,
------------------------
and
THE BANKS IDENTIFIED AS AGENTS
ON THE SIGNATURE PAGES HEREOF,
as Agents
---------
============================================================
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms . . . . . . . . . . . . . . . . . 1
1.2. Computation of Time Periods . . . . . . . . . . 18
1.3. Accounting Terms . . . . . . . . . . . . . . . . 19
ARTICLE II
AMOUNT AND TERMS OF THE LOANS
2.1. The Loans . . . . . . . . . . . . . . . . . . . 19
2.2. Making the Loans . . . . . . . . . . . . . . . . 20
2.3. Termination/Reduction of the Loan Commitments . 22
2.4. Repayment of the Loan . . . . . . . . . . . . . 23
2.5. Optional Prepayments of the Loan . . . . . . . . 23
2.6. Mandatory Prepayment . . . . . . . . . . . . . . 23
ARTICLE III
CONVERSION, INTEREST, PAYMENTS, FEES, ETC.
3.1. Conversion/Continuation Option . . . . . . . . . 23
3.2. Interest . . . . . . . . . . . . . . . . . . . . 24
3.3. Interest Rate Determination and Protection . . . 25
3.4. Fees . . . . . . . . . . . . . . . . . . . . . . 26
3.5. Increased Costs . . . . . . . . . . . . . . . . 26
3.6. Illegality . . . . . . . . . . . . . . . . . . . 28
3.7. Capital Adequacy . . . . . . . . . . . . . . . . 29
3.8. Payments and Computations . . . . . . . . . . . 30
3.9. Sharing of Payments, Etc. . . . . . . . . . . . 31
3.10. Replacement Banks . . . . . . . . . . . . . . . 32
-i-
ARTICLE IV
CONDITIONS OF LENDING
4.1. Conditions Precedent to the Making of the Initial
Loans . . . . . . . . . . . . . . . . . . . . 32
4.2. Additional Conditions Precedent to the Making
of the Initial Loans . . . . . . . . . . . . 33
4.3. Conditions Precedent to the Making of
Each Loan . . . . . . . . . . . . . . . . . . 34
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.1. Corporate Existence; Compliance with Law . . . . 34
5.2. Corporate Power; Authorization; Enforceable
Obligations . . . . . . . . . . . . . . . . . 34
5.3. Taxes . . . . . . . . . . . . . . . . . . . . . 35
5.4. Financial Information . . . . . . . . . . . . . 36
5.5. Litigation . . . . . . . . . . . . . . . . . . . 37
5.6. Margin Regulations . . . . . . . . . . . . . . . 37
5.7. ERISA . . . . . . . . . . . . . . . . . . . . . 37
5.8. No Defaults . . . . . . . . . . . . . . . . . . 38
5.9. Investment Company Act . . . . . . . . . . . . . 38
5.10. Insurance . . . . . . . . . . . . . . . . . . . 38
5.11. Environmental Protection . . . . . . . . . . . . 38
5.12. Title and Liens . . . . . . . . . . . . . . . . 38
5.13. Trademarks, Copyrights, Etc. . . . . . . . . . . 39
5.14. FCC Licenses, Franchises . . . . . . . . . . . . 39
5.15. Disclosure . . . . . . . . . . . . . . . . . . . 39
ARTICLE VI
FINANCIAL COVENANTS
6.1. Total Leverage Ratio . . . . . . . . . . . . . . 40
6.2. Ratio of EBIDT to Trailing Total Cash Interest
and Preferred Dividends . . . . . . . . . . . 40
6.3. Minimum Net Worth . . . . . . . . . . . . . . . 40
ARTICLE VII
AFFIRMATIVE COVENANTS
7.1. Compliance with Laws, Etc. . . . . . . . . . . . 41
7.2. Payment of Taxes, Etc. . . . . . . . . . . . . . 41
7.3. Maintenance of Insurance . . . . . . . . . . . . 41
-ii-
7.4. Preservation of Corporate Existence, Etc. . . . 41
7.5. Books and Access . . . . . . . . . . . . . . . . 42
7.6. Maintenance of Properties, Etc. . . . . . . . . 42
7.7. Application of Proceeds . . . . . . . . . . . . 42
7.8. Financial Statements . . . . . . . . . . . . . . 42
7.9. Reporting Requirements . . . . . . . . . . . . . 44
ARTICLE VIII
NEGATIVE COVENANTS
8.1. Liens, Etc. . . . . . . . . . . . . . . . . . . 46
8.2. Mergers . . . . . . . . . . . . . . . . . . . . 47
8.3. Substantial Asset Sale . . . . . . . . . . . . . 47
8.4. Transactions with Affiliates . . . . . . . . . . 48
8.5. Margin Stock . . . . . . . . . . . . . . . . . . 48
8.6. Subsidiary Indebtedness . . . . . . . . . . . . 48
8.7. Other Restrictions on Indebtedness . . . . . . . 48
ARTICLE IX
EVENTS OF DEFAULT
9.1. Events of Default . . . . . . . . . . . . . . . 48
ARTICLE X
THE MANAGING AGENTS AND THE FACILITY AGENTS
10.1. Authorization and Action . . . . . . . . . . . 52
10.2. Managing Agents' and Facility Agents' Reliance,
Etc. . . . . . . . . . . . . . . . . . . . . 52
10.3. The Bank of New York, Citibank, N.A., Morgan
Guaranty Trust Company of New York, Bank of
America NT&SA and Their Affiliates . . . . . 53
10.4. Bank Credit Decision . . . . . . . . . . . . . 53
10.5. Determinations Under Sections 4.1, 4.2 and 4.3 54
10.6. Indemnification . . . . . . . . . . . . . . . . 54
10.7. Successor Facility Agents . . . . . . . . . . . 55
ARTICLE XI
MISCELLANEOUS
11.1. Amendments, Etc. . . . . . . . . . . . . . . . 55
11.2. Notices, Etc. . . . . . . . . . . . . . . . . . 56
11.3. No Waiver; Remedies . . . . . . . . . . . . . . 57
-iii-
11.4. Costs; Expenses; Indemnities . . . . . . . . . 57
11.5. Right of Set-Off . . . . . . . . . . . . . . . 59
11.6. Binding Effect . . . . . . . . . . . . . . . . 59
11.7. Assignments and Participations; Additional
Banks . . . . . . . . . . . . . . . . . . . . . 60
11.8. GOVERNING LAW; SEVERABILITY . . . . . . . . . . 62
11.9. SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL . . . . . . . . . . . . . . . . . . . . . 62
11.10. Confidentiality . . . . . . . . . . . . . . . . 63
11.11. Section Titles . . . . . . . . . . . . . . . . 63
11.12. Execution in Counterparts . . . . . . . . . . . 63
Schedules
Schedule I - List of Lending Offices
Schedule II - Commitments
Schedule 1.1(a) - Guarantees in Effect on the Date
of this Agreement
Schedule 1.1(b) - Existing Blockbuster Credit
Agreements
Schedule 8.1(a) - Satellite Transponder Liens
Schedule 8.1(b) - Liens
Schedule 8.6 - Existing Facilities
Exhibits
Exhibit A - Notice of Borrowing
Exhibit B - Paramount Guarantee
Exhibit C - VII Guarantee
Exhibit D - Notice of Conversion or
Continuation
Exhibit E-1 - Form of Opinion of Shearman &
Sterling
Exhibit E-2 - Form of Opinion Philippe P. Dauman
Exhibit F - Form of Assignment and Acceptance
-iv-
CREDIT AGREEMENT, dated as of September 29, 1994,
among VIACOM INC., a Delaware corporation (the "Borrower"),
the Banks parties hereto from time to time, THE BANK OF NEW
YORK, as a Managing Agent and as the Documentation Agent,
CITIBANK, N.A., as a Managing Agent and as the
Administrative Agent, MORGAN GUARANTY TRUST COMPANY OF NEW
YORK, as a Managing Agent, JP MORGAN SECURITIES INC., as the
Syndication Agent, THE BANK OF AMERICA NT&SA, as a Managing
Agent, and the Banks identified as Agents on the signature
pages hereof, as Agents.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Borrower has requested that the Banks
provide senior debt financing for, among other things, the
refinancing of certain existing indebtedness of Blockbuster
Entertainment Corporation, a Delaware corporation ("Block-
buster") concurrently with its merger into the Borrower, for
payment of related transaction costs, fees and expenses, and
for general corporate purposes, and the Banks are willing to
make funds available for such purposes, but only upon the
terms and subject to the conditions contained herein;
NOW, THEREFORE, in consideration of the premises
and the covenants and agreements contained herein, the par-
ties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms. As used in this Agreement,
-------------
the following terms have the following meanings (such
meanings to be equally applicable to both the singular and
plural forms of the terms defined):
"Administrative Agent" means Citibank, N.A., in
--------------------
its capacity as the Administrative Agent, or any successor
in such capacity.
"Affiliate" means, as to any Person, any
---------
Subsidiary of such Person and any other Person which,
directly or indirectly, controls, is controlled by or is
under common control with such Person. For the purposes of
this definition, "control" means the possession of the power
to direct or cause the direction of management and policies
of any Person, whether through the ownership of voting
securities, by contract or otherwise.
"Agents" means each of the Banks identified as
------
Agents on the signature pages hereof.
"Agreement" means this Credit Agreement, as
---------
modified, amended or supplemented from time to time.
"APB 16 and 17" means Accounting Principles Board
-------------
Opinions Nos. 16 and 17 as in effect at the time that any
addition or adjustment required thereunder is to be made to
the financial statements of a Person.
"Applicable Eurodollar Rate Margin" shall mean on
---------------------------------
any date the percentage set forth below opposite the Credit
Rating applicable to the Borrower on such date:
CREDIT RATING MARGIN
------------- ------
A-/A3 or better .375%
BBB+/Baa1 .500%
BBB/Baa2 .625%
BBB-/Baa3 .750%
BB+/Ba1 1.000%
BB/Ba2 1.250%
BB-/Ba3 or lower 1.500%
; provided, however, that if the ratings assigned by S&P and
-------- -------
Moody's shall differ by one level, the Credit Rating shall
be the rating which is the higher level, or if they differ
by more than one level, the Credit Rating shall be the
rating that is one rating level immediately above the lower
of such ratings. Any change in the Credit Rating of the
Borrower shall be effective to adjust the Applicable
Eurodollar Rate Margin as of the date such change is
announced by the applicable Rating Agency.
"Applicable Lending Office" means, with respect to
-------------------------
each Bank, its Domestic Lending Office in the case of a Base
Rate Loan, and its Eurodollar Lending Office in the case of
a Eurodollar Rate Loan.
"Arranger" means each of The Bank of New York,
--------
Citicorp Securities, Inc., JP Morgan Securities Inc. and BA
Securities Inc.
"Banks" means the lenders listed on the signature
-----
pages hereof, and such other lenders as may become parties
hereto from time to time pursuant to Section 11.7.
"Base Rate" means, for any day, a fluctuating
---------
interest rate per annum as shall be in effect for such day,
-2-
which rate per annum shall be equal at all times to the
higher of
(a) the rate of interest announced publicly by
the Administrative Agent in New York, New York as the
Administrative Agent's base rate in effect for such
day; or
(b) the Federal Funds Rate for such day plus 1/2
of one percent per annum;
provided, however, that if the higher of the Credit Ratings
-------- -------
assigned by S&P and Moody's to the Borrower shall be BB-/Ba3
or lower, (or, if such Credit Ratings differ by more than
one level, the rating that is one rating level immediately
above the lower of such ratings, shall be BB-/Ba3 or lower)
then the Base Rate shall be equal at all times to the sum of
(x) the higher of the foregoing rates plus (y) 1/2 of one
----
percent per annum.
"Base Rate Loan" means any Loan or portion thereof
--------------
that bears interest with reference to the Base Rate.
"Blockbuster" has the meaning specified in the
-----------
recitals hereof.
"Borrower" has the meaning specified in the
--------
recitals hereof.
"Borrowing" means a borrowing by the Borrower
---------
consisting of Loans made on the same day by the Banks
ratably according to their respective Commitments.
"Business Day" means a day of the year on which
------------
banks are not required or authorized to close in New York
City and, if the applicable Business Day relates to a
Eurodollar Rate Loan, a day on which dealings are also
carried on in Dollars in the London interbank market.
"Capitalized Lease" means, as applied to any
-----------------
Person, any lease of property by such Person as lessee which
should be capitalized on a balance sheet of such Person
prepared in accordance with GAAP, other than leases of
satellite transponders.
"Cash Equivalents" means (i) securities with
----------------
maturities of one year or less from the date of acquisition
issued or fully guaranteed or insured by the United States
government or any agency thereof, (ii) certificates of
deposit, time deposits, bankers' acceptances and repurchase
agreements of any commercial bank rated at least A-3 by
-3-
Moody's, (iii) negotiable Eurodollar certificates of deposit
and time deposits issued by a London affiliate of a U.S.
commercial bank or Canadian bank qualified under the
preceding clause (ii) if such affiliate's long-term debt is
rated A-3 or better by Moody's and (iv) commercial paper of
an issuer rated at least A-1+ by S&P or P-1 by Moody's, or
carrying an equivalent rating by a nationally recognized
rating agency, if both of the two named rating agencies
cease publishing ratings of investments.
"Code" means the Internal Revenue Code of 1986 (or
----
any successor legislation thereto), as amended from time to
time.
"Commercial Paper" means any unsecured promissory
----------------
note of the Borrower or Viacom International with a maturity
at the time of issuance not exceeding nine months, exclusive
of days of grace, issued by the Borrower or Viacom
International pursuant to a commercial paper program of
either.
"Commitment" has the meaning specified in
----------
Section 2.1(a).
"Commitment Fee" has the meaning specified in
--------------
Section 3.4(a).
"Commitment Termination Date" means the earlier of
---------------------------
(i) July 1, 2002 and (ii) the date of the earlier termina-
tion in whole of all of the Commitments pursuant to the
terms hereof, including pursuant to Section 9.1.
"Contaminant" means any waste, pollutant,
-----------
hazardous substance, toxic substance, hazardous waste,
special waste, petroleum or petroleum derived substance or
waste, or any constituent of such substance or waste,
including any substance regulated under any Environmental
Law.
"Credit Rating" means the most recent rating of
-------------
the long-term senior unsecured debt of the Borrower
announced by Moody's or S&P or, in the event that either or
both cease the issuance of debt ratings generally, such
other rating agency or rating agencies agreed to by the
Majority Banks.
"Default" means any event which with the passing
-------
of time or the giving of notice or both would become an
Event of Default.
-4-
"Documentation Agent" means The Bank of New York,
-------------------
in its capacity as the Documentation Agent, or any successor
in such capacity.
"Dollars" and the sign "$" each mean the lawful
-------
money of the United States of America.
"Domestic Lending Office" means, with respect to
-----------------------
any Bank, the office of such Bank specified as its "Domestic
Lending Office" opposite its name on Schedule I or such
other office of such Bank as such Bank may from time to time
specify to the Borrower and the Administrative Agent.
"Earnings from Operations" means, at any time, for
------------------------
the Borrower and its Subsidiaries, revenues plus equity in
----
earnings of affiliated companies, less (i) operating
----
expenses, (ii) selling expenses, (iii) general and
administrative expenses and (iv) depreciation and
amortization expenses.
"EBIDT" means, at any time, the Earnings from
-----
Operations of the Borrower and its Subsidiaries on a
consolidated basis as set forth in the statement of
operations of the Borrower and its Subsidiaries for the
immediately preceding four Fiscal Quarters for which
financial statements have been delivered to the Banks
pursuant to Section 7.8 of this Agreement (adjusted to
account for material dispositions during such four Fiscal
Quarters), plus (to the extent previously deducted) (a) the
----
sum of the following expenses of the Borrower and its
Subsidiaries for such period: (i) depreciation expense;
(ii) amortization expense (including all amortization
expenses recognized in accordance with APB 16 and 17 but
excluding all other amortization of programming, production
and pre-publication costs); (iii) expenses accrued under the
Incentive Plans for such period; (iv) non-recurring expenses
and non-cash charges incurred in connection with the "Tender
Offer" or the "Merger" (each as defined in the July
Agreements) or the Merger, (v) in the event that, during
such period, the Borrower or any of its Subsidiaries
acquires all or substantially all of the assets or Equity of
any other Person or any Equity in any other Person that is
reported on an equity basis, the EBIDT of such Person, as
determined in accordance with the terms of this definition,
shall be included in the EBIDT of the Borrower for all
Fiscal Quarters during such period; (vi) all other non-cash
charges; and (vii) with respect to the calculation of EBIDT
through September 30, 1994, $48.35 million of expenses
associated with programming write-offs at USA Networks less
----
(b) the proportional EBIDT of the interests held by any
other Person in entities fully consolidated with the
-5-
Borrower and its Subsidiaries, as determined in accordance
with the terms of this definition, less (c) Net Video Tape
----
Purchases. For the purposes of Section 6.2 only, EBIDT
shall be calculated on an actual historical basis without
taking into account acquisitions or dispositions during any
relevant calculation period.
"Effective Date" means the earliest date on which
--------------
all of the conditions precedent specified in Section 4.1
shall have been satisfied or waived.
"Environmental Law" means the Comprehensive
-----------------
Environmental Response, Compensation, and Liability Act (42
U.S.C. Sec. 9601 et seq.), the Hazardous Material Trans-
-- ---
portation Act (49 U.S.C. Sec. 1801 et seq.), the Resource
-- ---
Conservation and Recovery Act (42 U.S.C. Sec. 6901 et seq.),
-- ---
the Federal Water Pollution Control Act (33 U.S.C. Sec. 1251 et
--
seq.), the Clean Air Act (42 U.S.C. Sec. 7401 et seq.), the
--- -- ---
Toxic Substances Control Act (15 U.S.C. Sec. 2601 et seq.), and
-- ---
the Occupational Safety and Health Act (29 U.S.C. Sec. 651 et
--
seq.), in each case as amended or supplemented from time to
---
time, and any analogous future federal or present or future
state or local statutes, including, without limitation,
transfer of ownership notification statutes such as the New
Jersey Environmental Cleanup Responsibility Act (N.J. Stat.
Ann. Sec. 13:1K-6 et seq.) and the Connecticut Industrial
-- ---
Transfer Law of 1985 (Conn. Gen. Stat. Sec. 22a-134 et seq.)
-- ---
and the regulations promulgated pursuant thereto.
"Environmental Liabilities and Costs" means, as to
-----------------------------------
any Person, all liabilities, obligations, responsibilities,
Remedial Actions, losses, damages, punitive damages, con-
sequential damages, treble damages, costs and expenses
(including, without limitation, all reasonable fees,
disbursements and expenses of counsel, expert and consulting
fees, and costs of investigation and feasibility studies),
fines, penalties, sanctions and interest incurred as a
result of any claim or demand, by any Person, whether based
in contract, tort, implied or express warranty, strict
liability, any criminal or civil statute, including any
Environmental Law, Permit, order or agreement with any
Governmental Authority or other Person, arising from
environmental, health or safety conditions, or the Release
or threatened Release of a Contaminant into the environment,
resulting from the past, present or future operations of
such Person or its Subsidiaries.
"Environmental Lien" means any Lien in favor of
------------------
any Governmental Authority for Environmental Liabilities and
Costs.
-6-
"Equity" means all shares, options, equity
------
interests, general or limited partnership interests, joint
venture interests or participations or other equivalents
(regardless of how designated) of or in a corporation,
partnership or other entity, whether voting or non-voting,
and including, without limitation, common stock, preferred
stock, purchase rights, warrants or options for any of the
foregoing.
"ERISA" means the Employee Retirement Income
-----
Security Act of 1974 (or any successor legislation thereto)
and the rules and regulations promulgated thereunder, as
amended from time to time.
"ERISA Affiliate" shall mean a corporation,
---------------
partnership or other entity which is considered one employer
with the Borrower under Section 4001 of ERISA or Section 414
of the Code.
"ERISA Event" means (i) a Reportable Event with
-----------
respect to a Title IV Plan; (ii) the withdrawal of the
Borrower, any of its Subsidiaries or any ERISA Affiliate
from a Title IV Plan subject to Section 4063 of ERISA during
a plan year in which it was a substantial employer, as
defined in Section 4001(a)(2) of ERISA; (iii) the filing of
a notice of intent to terminate a Title IV Plan or the
treatment of a plan amendment as a termination under
Section 4041 of ERISA; or (iv) the institution of pro-
ceedings to terminate a Title IV Plan or Multiemployer Plan
by the PBGC.
"Eurocurrency Liabilities" has the meaning
------------------------
specified in Regulation D.
"Eurodollar Lending Office" means, with respect to
-------------------------
any Bank, the office of such Bank specified as its "Euro-
dollar Lending Office" opposite its name on Schedule I (or,
if no such office is specified, its Domestic Lending Office)
or such other office of such Bank as such Bank may from time
to time specify to the Borrower and the Administrative
Agent.
"Eurodollar Rate" means, for any Interest Period,
---------------
the rate of interest per annum determined by the Admin-
istrative Agent to be the offered rate per annum at which
deposits in Dollars appears on the Telerate Page 3750 (or
any successor page) as of 11:00 A.M. (London time), or in
the event such offered rate is not available from the
Telerate Page, the average (rounded upward to the nearest
whole multiple of 1/16 of 1% per annum, if such average is
not such a multiple) of the rates offered by the principal
-7-
office of each of the Reference Banks in London, England to
prime banks in the London interbank market at 11:00 A.M.
(London time), two Business Days before the first day of
such Interest Period for deposit in dollars in an amount
substantially equal to the aggregate Eurodollar Rate Loans
to which such Interest Period relates and for a period equal
to such Interest Period.
"Eurodollar Rate Loan" means any Loan or portion
--------------------
thereof that bears interest at a rate determined with
reference to the Eurodollar Rate.
"Eurodollar Rate Reserve Percentage" means, for
----------------------------------
any Bank for any Interest Period, the reserve percentage
applicable during such Interest Period (or if more than one
such percentage shall be so applicable, the daily average of
such percentages for those days in such Interest Period
during which any such percentage shall be so applicable)
under Regulation D for determining the actual reserve
requirement incurred by such Bank (including, without
limitation, any emergency, supplemental or other marginal
reserve requirement) with respect to liabilities or assets
consisting of or including Eurocurrency Liabilities having a
term equal to such Interest Period.
"Event of Default" has the meaning specified in
----------------
Section 9.1.
"Existing Blockbuster Credit Agreements" means the
--------------------------------------
Credit Agreements described on Schedule 1.1(b).
"Facility Agents" means each of the Administrative
---------------
Agent, the Documentation Agent and the Syndication Agent.
"FCC" means the Federal Communications Commission,
---
or any successor thereto.
"FCC License" means, with respect to the Borrower
-----------
or any of its Subsidiaries, any radio, television or other
license, Permit, certificate of compliance or authorization
issued by the FCC and required for the operation of its
respective radio and television broadcast stations and cable
television systems.
"Federal Funds Rate" means, for any day, a
------------------
fluctuating interest rate per annum equal for such day to
the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System
arranged by federal funds brokers, as published for such day
(or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New
-8-
York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such
day on such transactions received by the Administrative
Agent from three federal funds brokers of recognized
standing selected by it.
"Final Judgment" has the meaning specified in
--------------
Section 9.1(g).
"Fiscal Quarter" means any three month period
--------------
ending March 31, June 30, September 30 or December 31 of any
Fiscal Year, or such other fiscal quarter end date as may be
determined by the Borrower.
"Fiscal Year" means each twelve-month period
-----------
ending December 31, or such other fiscal year end date as
may be determined by the Borrower.
"Franchise" means a franchise, authorization or
---------
right by contract to construct, own, operate or otherwise
exploit any cable television facility operated by the
Borrower or any of its Subsidiaries, granted by any
Governmental Authority.
"GAAP" means generally accepted accounting
----
principles in the United States of America as in effect from
time to time and set forth in the rules, regulations,
opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public
Accountants and the statements and pronouncements of the
Financial Accounting Standards Board, or in such other
statements by such other entity as may be in general use by
significant segments of the accounting profession and which
are applicable to the circumstances as of the date of
determination.
"GAAS" means generally accepted auditing standards
----
in the United States of America as in effect from time to
time and set forth in the rules, regulations, opinions and
pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and the
statements and pronouncements of the Financial Accounting
Standards Board, or in such other statements by such other
entity as may be in general use by significant segments of
the accounting profession and which are applicable to the
circumstances as of the date of determination.
"Governmental Authority" means any nation or
----------------------
government, any state or other political subdivision thereof
and any entity exercising executive, legislative, judicial,
-9-
regulatory or administrative functions of or pertaining to
government.
"Guarantor Subsidiaries" means each of Viacom
----------------------
International and Paramount.
"Incentive Plans" means the Borrower's Long-Term
---------------
Incentive Plan and Long-Term Management Incentive Plan.
"Indebtedness" of any Person means at any date,
------------
without duplication, (i) all obligations of such Person for
borrowed money (including, without limitation, in the case
of the Borrower, the obligations of the Borrower for
borrowed money under this Agreement), (ii) all obligations
of such Person evidenced by bonds, debentures, notes or
other similar instruments, (iii) all obligations of such
Person to pay the deferred purchase price of Property or
services, except as provided below, (iv) all obligations of
such Person as lessee under Capitalized Leases, (v) all
Indebtedness of others secured by a Lien on any Property of
such Person, whether or not such Indebtedness is assumed by
such Person, (vi) all Indebtedness of others directly or
indirectly guaranteed or otherwise assumed by such Person,
including any obligations of others endorsed (otherwise than
for collection or deposit in the ordinary course of
business) or discounted or sold with recourse by such
Person, or in respect of which such Person is otherwise
directly or indirectly liable, including, without limitation
any Indebtedness in effect guaranteed by such Person through
any agreement (contingent or otherwise) to purchase, repur-
chase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge
of such obligation, or to maintain the solvency or any
balance sheet or other financial condition of the obligor of
such obligation, provided that Indebtedness of the Borrower
--------
and its Subsidiaries shall not include (a) guarantees in
existence on the date hereof of Indebtedness of discontinued
operations, and (b) guarantees of Indebtedness that are
identified on Schedule 1.1(a) to this Agreement and that
arise from commitments in existence at the date hereof (in
each of cases (a) and (b), only if such guarantees are not
extended by the Borrower or any of its Subsidiaries after
the date hereof or, in the case of any increase in
commitments, only the amount of the increase in such
existing commitments shall be included in Indebtedness)
(vii) all obligations of such Person as issuer, customer or
account party under letters of credit or bankers'
acceptances that are either drawn or that back financial
obligations that would otherwise be Indebtedness; provided,
--------
however, that in each of the foregoing clauses (i) through
-------
(vii), Indebtedness shall not include obligations (other
-10-
than under this Agreement and the July Agreements)
specifically with respect to the production, distribution
and acquisition of motion pictures or other programming
rights, talent or publishing rights.
"Indemnified Liability" has the meaning specified
---------------------
in Section 11.4(b).
"Indemnified Person" has the meaning specified in
------------------
Section 11.4(b).
"Initial Funding Date" means the date on which the
--------------------
conditions set forth in Sections 4.1, 4.2 and 4.3 are
satisfied or waived and the initial Loans are made
hereunder.
"Interest Period" means, (a) in the case of Base
---------------
Rate Loans, the period commencing on the date such Loans are
made or on the date of conversion of such Loans from
Eurodollar Rate Loans and ending on the last day of each
Fiscal Quarter, and (b) in the case of Eurodollar Rate
Loans, (i) initially, the period commencing on the date such
Loans are made or on the date of conversion of such Loans or
portions thereof from Base Rate Loans and ending one, two,
three or six months thereafter, as selected by the Borrower
in its Notice of Borrowing or Notice of Conversion or
Continuation given to the Administrative Agent pursuant to
Section 2.2 or 3.1, as the case may be, and (ii) thereafter,
if such Loans are renewed, in whole or in part, as Euro-
dollar Rate Loans pursuant to Section 3.1, the period
commencing on the last day of the immediately preceding
Interest Period therefor and ending one, two, three or six
months thereafter, as selected by the Borrower in its Notice
of Conversion or Continuation given to the Administrative
Agent pursuant to Section 3.1, subject, however, to the
following:
(i) if any Interest Period would otherwise end on
a day that is not a Business Day, such Interest Period
shall be extended to the next succeeding Business Day,
unless the result of such extension for any Eurodollar
Rate Loan would be to extend such Interest Period into
another calendar month, in which event such Interest
Period shall end on the immediately preceding Business
Day;
(ii) any Interest Period in respect of Eurodollar
Rate Loans that begins on the last Business Day of a
calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at
-11-
the end of such Interest Period) shall end on the last
Business Day of a calendar month;
(iii) no Interest Period may extend beyond the
Commitment Termination Date;
(iv) the Borrower may not select any Interest
Period in respect of Loans in an aggregate amount less
than $5,000,000; and
(v) there shall be outstanding at any one time no
more than 20 Interest Periods in the aggregate.
"IRS" means the Internal Revenue Service, or any
---
successor thereto.
"July Agreements" means (i) the Credit Agreement,
---------------
dated as of July 1, 1994, among the Borrower, the banks
party thereto from time to time, The Bank of New York,
Citibank N.A., Morgan Guaranty Trust Company of New York and
Bank of America NT&SA as Managing Agents, The Bank of New
York as the Documentation Agent, Citibank N.A. as the
Administration Agent, J.P. Morgan Securities Inc. as the
Syndication Agent, the banks identified as Agents on the
signature pages thereof and the banks identified as
Co-Agents on the signature pages thereof, as Co-Agents; and
(ii) the Credit Agreement, dated as of July 1, 1994, among
Viacom International, Viacom Cablevision of Dayton, Inc.,
WNYT Inc., WMZQ Inc. and WVIT Inc., each a Delaware
corporation and an indirect wholly owned Subsidiary of the
Borrower, the banks parties thereto from time to time, The
Bank of New York, Citibank, N.A., Morgan Guaranty Trust
Company of New York and Bank of America NT&SA, as Managing
Agents, The Bank of New York, as Documentation Agent,
Citibank, N.A., as the Administrative Agent, JP Morgan
Securities Inc. as the Syndication Agent, the banks
identified as Agents on the signature pages thereof, as
Agents, and the banks identified as Co-Agents on the
signature pages thereof, as Co-Agents.
"Lenders" means the Banks under, and as defined
-------
in, the July Agreements.
"Lien" means any mortgage, deed of trust, pledge,
----
hypothecation, assignment, deposit arrangement, encumbrance,
lien (statutory or other), security interest or preference,
priority or other security agreement or preferential
arrangement of any kind or nature whatsoever, including,
without limitation, any conditional sale or other title
retention agreement.
-12-
"Loan Documents" means, collectively, this
--------------
Agreement, the VII Guarantee and the Paramount Guarantee.
"Loan Parties" means each of the Borrower and each
------------
Guarantor Subsidiary.
"Loans" means the loans made to the Borrower
-----
pursuant to Section 2.1.
"Majority Banks" means, at any time, Banks and
--------------
Lenders having at least 51% of the aggregate Commitments
under this Agreement and the July Agreements, taken together
and voting as a single group; provided, however, that for
-------- -------
purposes of this definition, if the Commitments under this
Agreement or either of the July Agreements of any Bank or
Lender shall have been terminated, the then aggregate unpaid
principal amount of Loans of such Bank or Lender thereunder
shall be deemed to be such Bank's or such Lender's
Commitment under this Agreement or the July Agreements, as
the case may be.
"Managing Agents" means each of The Bank of New
---------------
York, Citibank, N.A., Morgan Guaranty Trust Company of New
York and Bank of America NT&SA, acting in such capacity.
"Margin Stock" has the meaning specified in
------------
Regulation U.
"Material Adverse Change" means a change that has
-----------------------
resulted or would result in a Material Adverse Effect.
"Material Adverse Effect" means a material adverse
-----------------------
effect on the business, financial condition, operations or
Properties of the Borrower and its Subsidiaries taken as a
whole.
"Material Credit Agreement Change" means a change
--------------------------------
that has materially adversely affected or would materially
adversely affect the legality, validity or enforceability of
any payment obligation of the Borrower, Viacom International
or Paramount under this Agreement or any other Loan
Document.
"Material Subsidiary" of any Person means any
-------------------
"significant subsidiary" of such Person as defined in
Regulation S-X, as amended from time to time, promulgated
under the Securities Act of 1933, as amended.
"Merger" means the merger of Blockbuster with and
------
into the Borrower, with the Borrower as the surviving
corporation.
-13-
"Merger Debentures" means the Borrower's 8%
-----------------
Exchangeable Subordinated Debentures due 2006.
"Moody's" means Moody's Investors Service, Inc.
-------
"Multiemployer Plan" means a multiemployer plan,
------------------
as defined in Section 4001(a)(3) of ERISA, to which the
Borrower, any of its Subsidiaries or any ERISA Affiliate is
making, is obligated to make, has made or been obligated to
make, contributions on behalf of participants who are or
were employed by any of them.
"NAI" means National Amusements, Inc., a Maryland
---
corporation.
"Net Video Tape Purchases" means the aggregate
------------------------
purchases of videocassettes less (i) purchases to stock new
or remodeled stores and (ii) videocassette sales of
previously viewed videocassettes.
"Net Worth" means, at any time, as to the Borrower
---------
and its Subsidiaries on a consolidated basis (determined in
accordance with GAAP), the excess of total assets over
(i) total liabilities as shown on the Borrower's then most
recent consolidated balance sheet and (ii) preferred stock
that is either exchangeable into debt or is non-perpetual.
"Notice of Assignment and Acceptance" has the
-----------------------------------
meaning specified in Section 11.7(a).
"Notice of Borrowing" means a notice of the
-------------------
Borrower substantially in the form of Exhibit A hereto
specifying therein (i) the date of the proposed Borrowing,
(ii) the aggregate amount of such proposed Borrowing,
(iii) the amount thereof, if any, requested to be Eurodollar
Rate Loans and (iv) the initial Interest Period or Interest
Periods for any such Eurodollar Rate Loans.
"Notice of Conversion or Continuation" has the
------------------------------------
meaning specified in Section 3.1.
"Paramount" means Paramount Communications Inc., a
---------
Delaware corporation.
"Paramount Guarantee" means the guarantee by
-------------------
Paramount of the obligations of the Borrower pursuant to
this Agreement, substantially in the form of Exhibit B
hereto.
"PBGC" means the Pension Benefit Guaranty
----
Corporation, or any successor thereto.
-14-
"Pension Plan" means an employee pension benefit
------------
plan, as defined in Section 3(2) of ERISA (other than a
Multiemployer Plan), which is not an individual account
plan, as defined in Section 3(34) of ERISA, and which the
Borrower, any of its Subsidiaries or any ERISA Affiliate now
or in the future maintains, contributes to or has an
obligation to contribute to on behalf of participants who
are or were employed by any of them.
"Permit" means any permit, approval, authoriza-
------
tion, license, variance or permission required from a
Governmental Authority under an applicable Requirement of
Law.
"Person" means an individual, partnership,
------
corporation (including a business trust), joint stock
company, trust, unincorporated association, joint venture or
other entity, or Governmental Authority.
"Plan" shall mean an employee benefit plan as
----
defined in Section 3(3) of ERISA which is maintained or
contributed to by the Borrower or an ERISA Affiliate.
"Property" means any interest in any kind of
--------
property or asset, whether real, personal or mixed, and
whether tangible or intangible, including, without
limitation, the right to use, transmit, display, license or
otherwise temporarily or permanently benefit from the
possession of, control of or access to any film, television
program, trademark, trade name, copyright, service mark or
any other type of intellectual or intangible property.
"Qualified Plan" means an employee pension benefit
--------------
plan, as defined in Section 3(2) of ERISA, which is intended
to be tax-qualified under Section 401(a) of the Code, and
which the Borrower, any of its Subsidiaries or any ERISA
Affiliate now or in the future maintains, contributes to or
has an obligation to contribute to on behalf of participants
who are or were employed by any of them.
"Ratable Portion" means, with respect to any Bank,
---------------
the percentage obtained by dividing the amount of such
Bank's Commitment by the aggregate amount of Commitments of
all the Banks.
"Reference Banks" means The Bank of New York,
---------------
Citibank, N.A., Morgan Guaranty Trust Company of New York
and the Bank of America NT&SA.
"Register" has the meaning specified in
--------
Section 11.7(g) hereof.
-15-
"Regulation D" means Regulation D of the Board of
------------
Governors of the Federal Reserve System (or any successor
thereto), as in effect from time to time, or any successor
thereto.
"Regulation T" means Regulation T of the Board of
------------
Governors of the Federal Reserve System (or any successor
thereto), as in effect from time to time, or any successor
thereto.
"Regulation U" means Regulation U of the Board of
------------
Governors of the Federal Reserve System (or any successor
thereto), as in effect from time to time, or any successor
thereto.
"Regulation X" means Regulation X of the Board of
------------
Governors of the Federal Reserve System (or any successor
thereto), as in effect from time to time, or any successor
thereto.
"Release" means, as to any Person, any release,
-------
spill, emission, leaking, pumping, injection, deposit,
disposal, discharge, disbursal, leaching or migration into
the indoor or outdoor environment or into or out of any
property owned by such Person, including the movement of
Contaminants through or in the air, soil, surface water,
ground water or property.
"Remedial Action" means all actions required to
---------------
(i) clean up, remove, treat or in any other way address
Contaminants in the indoor or outdoor environment,
(ii) prevent the Release or threat of Release or minimize
the further Release of Contaminants so they do not migrate
or endanger or threaten to endanger public health or welfare
or the indoor or outdoor environment, or (iii) perform pre-
remedial studies and investigations and post-remedial
monitoring and care.
"Reportable Event" means any of the events
----------------
described in Section 4043(b)(1), (2), (3), (5), (6), (8) or
(9) of ERISA.
"Requirements of Law" means all federal, state and
-------------------
local laws, rules, regulations, orders, decrees or other
determinations of an arbitrator, court or other Governmental
Authority, including the requirements of ERISA and
Environmental Law.
"Responsible Financial Officer" means the chief
-----------------------------
financial officer, treasurer, assistant treasurer, con-
troller, secretary, assistant secretary or other officer of
-16-
the Borrower listed in the certificate delivered to the
Managing Agents pursuant to Section 4.1(c) or otherwise
notified to the Administrative Agent as being authorized to
execute documents and certificates and otherwise act on
behalf of the Borrower in connection with financial matters
arising under this Agreement or any other Loan Document.
"Responsible Officer" of any Person means any of
-------------------
the officers of such Person listed in the certificate
delivered to the Managing Agents pursuant to Section 4.1(c)
or otherwise notified to the Administrative Agent as being
authorized to execute and deliver documents and certificates
and otherwise act on behalf of such Person in all matters
(other than financial matters) arising under this Agreement
or any other Loan Document.
"S&P" means Standard & Poor's Ratings Group.
---
"Scheduled Commitment Reduction Date" has the
-----------------------------------
meaning specified in Section 2.3(a).
"Single-Employer Plan" shall mean a single-
--------------------
employer plan as defined in section 4001(a)(15) of ERISA
which is subject to the provisions of Title IV of ERISA.
"6.625% Senior Blockbuster Notes" means
-------------------------------
Blockbuster's $150,000,000 senior notes, due February 15,
1998.
"Subsidiary" means, with respect to any Person,
----------
any corporation, partnership or other business entity of
which more than 50% of the outstanding Equity having
ordinary voting power to elect a majority of the board of
directors of such entity (irrespective of whether, at the
time, Equity of any other class or classes of such entity
shall have or might have voting power by reason of the
happening of any contingency) is, or of which more than 50%
of the interests in which are, at the time, directly or
indirectly, owned by such Person and/or one or more
Subsidiaries of such Person.
"Syndication Agent" means JP Morgan Securities
-----------------
Inc. in its capacity as the Syndication Agent, or any
successor in such capacity.
"Tax Affiliate" means, as to any Person, (i) any
-------------
Subsidiary of such Person, or (ii) any Affiliate of such
Person with which such Person files or is required to file
consolidated, combined or unitary tax returns.
-17-
"Tax Sharing Agreement" means the Income Tax
---------------------
Agreement, dated as of August 15, 1987, as amended, among
NAI, the Borrower and Viacom International.
"Title IV Plan" means a Pension Plan, other than a
-------------
Multiemployer Plan, which is covered by Title IV of ERISA.
"Total Cash Interest and Preferred Dividends"
-------------------------------------------
means, for any period, the sum of the following amounts:
(i) the cash interest expense incurred by the Borrower and
its Subsidiaries during the preceding four Fiscal Quarters
with respect to the aggregate amount of all Indebtedness
outstanding during such period plus (ii) the cash dividends
----
paid by the Borrower and its Subsidiaries to Persons other
than the Borrower and its wholly owned Subsidiaries during
such four Fiscal Quarters with respect to preferred stock.
"Total Debt" of the Borrower and its Subsidiaries
----------
means, on any date, the total outstanding Indebtedness of
the Borrower and its Subsidiaries on a consolidated basis;
provided that for purposes of calculating the Total Leverage
--------
Ratio, Total Debt shall be reduced by: (i) 85% of cash, Cash
Equivalents and short-term investments held by the Borrower
and its Subsidiaries on a consolidated basis from
September 30, 1994 to and including June 30, 1995, (ii) 75%
of such amounts on any date thereafter to and including
June 30, 1996, and (iii) 65% of such amounts on any date
thereafter; and provided further that Total Debt, as of any
--- -------- -------
date prior to January 1, 1995, shall not include the
outstanding principal amount of the Merger Debentures.
"Total Leverage Ratio" means the consolidated
--------------------
ratio of Total Debt to EBIDT.
"Viacom International" means Viacom International
--------------------
Inc., a Delaware corporation and a wholly owned subsidiary
of the Borrower.
"VII Guarantee" means the guarantee by Viacom
-------------
International of the obligations of the Borrower pursuant to
this Agreement, substantially in the form of Exhibit C
hereto.
"Withdrawal Liability" means, as to any Person, at
--------------------
any time, the aggregate amount of the liabilities, if any,
of such Person pursuant to Section 4201 of ERISA.
1.2. Computation of Time Periods. In this
---------------------------
Agreement, in the computation of periods of time from a
specified date to a later specified date, the word "from"
means "from and including" and the words "to" and "until"
-18-
each mean "to but excluding" and the word "through" means
"to and including".
1.3. Accounting Terms. All accounting terms not
----------------
specifically defined herein shall be construed in accordance
with GAAP.
The parties hereto agree, however, that in the
event that any change in accounting principles from those
used in the preparation of the financial statements referred
to in Section 5.4(a) is hereafter occasioned by the promul-
gation of rules, regulations, pronouncements, opinions and
statements by or required by the Financial Accounting
Standards Board or Accounting Principles Board or the
American Institute of Certified Public Accountants (or
successors thereto or agencies with similar functions) and
such change materially affects the calculation of any
component of any financial covenant, standard or term
contained in this Agreement, the Managing Agents and the
Borrower shall negotiate in good faith to amend such
financial covenants, standards or terms found in this
Agreement (other than in respect of financial statements to
be delivered hereunder) so that, upon adoption of such
changes, the criteria for evaluation of the Borrower's and
its Subsidiaries' financial condition shall be the same
after such change as if such change had not been made;
provided, however, that (i) any such amendments shall not
-------- -------
become effective for purposes of this Agreement unless
approved by the Majority Banks and (ii) if the Borrower and
the Majority Banks cannot agree on such an amendment, then
the calculations under such financial covenants, standards
or terms shall continue to be computed without giving effect
to such change in accounting principles.
ARTICLE II
AMOUNT AND TERMS OF THE LOANS
2.1. The Loans. (a) The Loans. On the terms
--------- ---------
and subject to the conditions contained in this Agreement,
each Bank severally agrees to make Loans to the Borrower
from time to time on any Business Day during the period from
the Initial Funding Date until the Commitment Termination
Date in an aggregate amount not to exceed at any time
outstanding the amount set forth opposite such Bank's name
on Schedule II as its "Commitment" (as adjusted from time to
time by reason of assignments in accordance with the provi-
sions of Section 11.7 and as such amount may be reduced
pursuant to Section 2.3 such Bank's "Commitment"). Within
the limits of each Bank's Commitment, amounts borrowed under
-19-
this Section 2.1(a) and prepaid pursuant to Section 2.5 may
be reborrowed under this Section 2.1(a).
(b) Evidence of Debt. (i) Each Bank shall
----------------
maintain in accordance with its usual practice an account or
accounts evidencing the Indebtedness to such Bank resulting
from each Loan made by such Bank to the Borrower from time
to time, including the amounts of principal and interest
payable and paid to such Bank from time to time hereunder.
(ii) The Register maintained by the
Administrative Agent pursuant to Section 11.7(g) shall
include a "Loan contract control account" for each Bank, in
which account shall be recorded (A) the date and amount of
each Borrowing hereunder, (B) the amount and type of each
Bank's Loan comprising such Borrowing and any Interest
Period applicable thereto, (C) the amount of any principal
or interest due and payable or to become due and payable
from the Borrower to each Bank with respect to each such
Loan hereunder and (D) the amount of any sum received by the
Administrative Agent from the Borrower with respect to such
Loans hereunder and each Bank's Ratable Portion thereof.
(iii) The entries made in the Register in respect
of the Loans shall be conclusive and binding for all
purposes, absent manifest error.
2.2. Making the Loans. (a) Each Borrowing shall
----------------
be made upon receipt of a Notice of Borrowing, given by the
Borrower to the Administrative Agent not later than (i) 9:30
A.M. (New York City time) on the Business Day of the pro-
posed Borrowing, in the event such Borrowing is to be
comprised of Base Rate Loans, and (ii) 11:00 A.M. (New York
City time) on the third Business Day prior to the date of
the proposed Borrowing, in the event such Borrowing is to be
comprised of Eurodollar Rate Loans.
(b) The Administrative Agent shall give to each
Bank prompt notice (but in any event on the same day) of its
receipt of a Notice of Borrowing in respect of Loans and, if
Eurodollar Rate Loans are properly requested in such Notice
of Borrowing, upon its determination thereof, notice of the
applicable interest rate under Section 3.3(b). Each Bank
shall, before 11:00 A.M. (or in the case of a Borrowing
being made on the same day, before 12:00 noon) (New York
City time) on the date of the proposed Borrowing, make
available for the account of its Applicable Lending Office
to the Administrative Agent at its address referred to in
Section 11.2, in immediately available funds, such Bank's
Ratable Portion of such proposed Borrowing. After the
Administrative Agent's receipt of such funds and upon
-20-
fulfillment of the applicable conditions set forth in
Article IV, the Administrative Agent will make such funds
available to the Borrower at the Administrative Agent's
aforesaid address.
(c) Each Borrowing pursuant to this Section 2.2
shall be in an aggregate amount of not less than $5,000,000
or an integral multiple of $5,000,000 in excess thereof.
(d) Each Notice of Borrowing pursuant to this
Section 2.2 shall be irrevocable and binding on the
Borrower. In the case of any proposed Borrowing comprised
of Eurodollar Rate Loans, the Borrower shall indemnify each
Bank against any loss, cost or expense incurred by such Bank
as a result of any failure to fulfill on or before the date
specified in such Notice of Borrowing for such proposed
Borrowing the applicable conditions set forth in Article II,
including, without limitation, any loss (excluding loss of
the margin payable in accordance with Section 3.2 on the
amount of principal not borrowed as a result of such
failure), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds
acquired by such Bank to fund any Eurodollar Rate Loan to be
made by such Bank as part of such proposed Borrowing when
such Eurodollar Rate Loan, as a result of such failure, is
not made on such date.
(e) Unless the Administrative Agent shall have
received notice from a Bank prior to the date of any
proposed Borrowing pursuant to this Section 2.2 that such
Bank will not make available to the Administrative Agent
such Bank's Ratable Portion of such Borrowing, the Admin-
istrative Agent may assume that such Bank has made such
Ratable Portion available to the Administrative Agent on the
date of such Borrowing in accordance with this Section 2.2
and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank
shall not have so made such Ratable Portion available to the
Administrative Agent and the Administrative Agent has so
made available such amount, such Bank and the Borrower
severally agree to repay to the Administrative Agent
forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is
made available to the Borrower until the date such amount is
repaid to the Administrative Agent, at (i) in the case of
the Borrower, the interest rate applicable at the time to
the Loan comprising such Borrowing and (ii) in the case of
such Bank, the Federal Funds Rate. If such Bank shall repay
to the Administrative Agent such corresponding amount, such
amount so repaid shall constitute such Bank's Loan as part
-21-
of such Borrowing for purposes of this Agreement. If the
Borrower shall repay to the Administrative Agent such
corresponding amount, such payment shall not relieve such
Bank of any obligation it may have to the Borrower
hereunder.
(f) The failure of any Bank to make the Loan to
be made by it as part of any Borrowing pursuant to this
Section 2.2 shall not relieve any other Bank of its
obligation, if any, hereunder to make its Loan on the date
of such Borrowing, but no Bank shall be responsible for the
failure of any other Bank to make the Loan to be made by
such other Bank on the date of any such Borrowing.
2.3. Termination/Reduction of the Loan
---------------------------------
Commitments. (a) Scheduled Reductions. The Commitment of
----------- --------------------
each Bank shall be automatically reduced on each date
specified in column (x) below (each such date, a "Scheduled
Commitment Reduction Date") by an amount equal to such
Bank's Ratable Portion of the amount specified in column (y)
below opposite such date:
(x) (y)
Scheduled Revolving Amounts of
Loan Commitment Reduction of
Reduction Date Loan Commitments
------------------ ----------------
July 1, 1995 $0
July 1, 1996 $0
July 1, 1997 $0
July 1, 1998 $375,000,000
July 1, 1999 $575,000,000
July 1, 2000 $283,333,000
July 1, 2001 $283,333,000
July 1, 2002 $283,334,000
The amounts under (y) shall be adjusted in the
amounts and in the manner required under Section 2.3(b).
(b) Optional Reductions. The Borrower shall have
-------------------
the right, upon at least three Business Days' prior notice
to the Administrative Agent, to terminate in whole or
permanently reduce ratably in part the unused portions of
the respective Commitments of the Banks; provided, however,
-------- -------
that each partial reduction shall be in the aggregate amount
of not less than $5,000,000 or an integral multiple of
$5,000,000 in excess thereof; and optional reductions may be
---
allocated against Scheduled Commitment Reduction Dates in
any manner requested by the Borrower.
(c) Payment of Commitment Fee. Simultaneously
-------------------------
with any termination or reduction of the Commitments
-22-
pursuant to this Section 2.3, the Borrower shall pay to the
Administrative Agent for the account of each Bank Commitment
Fee, if any, on the amount of the Commitments so terminated
or reduced and owed to such Bank through the date of such
termination or reduction.
2.4. Repayment of the Loans. The Borrower shall
----------------------
repay the outstanding principal amount of the Loans
(together with all accrued but unpaid interest thereon) in
full on the Commitment Termination Date.
2.5. Optional Prepayments of the Loans. The
---------------------------------
Borrower may, upon at least three Business Days' prior
notice (or at least one Business Day's prior notice in the
case of Base Rate Loans), to the Administrative Agent
stating the proposed date and aggregate principal amount of
the prepayment, and if such notice is given the Borrower
shall, prepay the outstanding principal amount of the Loans
comprising a part of the same Borrowing, in whole or ratably
in part, together with accrued interest to the date of such
prepayment on the principal amount prepaid; provided,
--------
however, that the Borrower shall indemnify the Banks pur-
-------
suant to Section 11.4(c) in the event that any prepayment of
any Eurodollar Rate Loans shall be made on a day other than
the last day of an Interest Period for such Loans; and
provided further, however, that each partial prepayment
-------- ------- -------
permitted under this Section 2.5 shall be in an aggregate
amount not less than $5,000,000 or integral multiples of
$1,000,000 in excess thereof.
2.6. Mandatory Prepayment. The Borrower shall
--------------------
prepay Loans to the extent necessary to ensure that the
aggregate amount of all Loans outstanding will not at any
time exceed the Loan Commitments of the Banks.
ARTICLE III
CONVERSION, INTEREST, PAYMENTS, FEES, ETC.
3.1. Conversion/Continuation Option. The
------------------------------
Borrower may elect (i) at any time to convert Base Rate
Loans or any portion thereof to Eurodollar Rate Loans or
(ii) at the end of any Interest Period with respect thereto,
to convert Eurodollar Rate Loans or any portion thereof into
Base Rate Loans, or to continue such Eurodollar Rate Loans
or any portion thereof as Eurodollar Rate Loans for an
additional Interest Period; provided, however, that the
-------- -------
aggregate of the Eurodollar Rate Loans of the Borrower so
converted or so continued for each Interest Period must be
in the amount of $5,000,000 or an integral multiple of
-23-
$5,000,000 in excess thereof. Each such election shall be
in substantially the form of Exhibit D hereto (a "Notice of
Conversion or Continuation") and shall be made by giving the
Administrative Agent at least one Business Day's, in the
case of a conversion to a Base Rate Loan, and three Business
Days', in the case of a conversion to or a continuation of a
Eurodollar Rate Loan, prior written notice thereof speci-
fying (A) the amount and type of conversion or continuation,
(B) in the case of a conversion to or a continuation of
Eurodollar Rate Loans, the Interest Period therefor, and
(C) in the case of a conversion the date of conversion
(which date shall be a Business Day and, if a conversion
from a Eurodollar Rate Loan, shall also be the last day of
the Interest Period therefor). The Administrative Agent
shall promptly (but in any event on the same day) notify
each Bank of its receipt of a Notice of Conversion or
Continuation and of the contents thereof. Notwithstanding
the foregoing, no conversion in whole or in part of Base
Rate Loans to Eurodollar Rate Loans, and no continuation in
whole or in part of Eurodollar Rate Loans upon the expira-
tion of any Interest Period therefor, shall be permitted at
any time at which an Event of Default shall have occurred
and be continuing. If, within the time period required
under the terms of this Section 3.1, the Administrative
Agent does not receive a Notice of Conversion or Con-
tinuation from the Borrower containing an election to
continue all or any portion of the Eurodollar Rate Loans for
an additional Interest Period or to convert all or any
portion of such Loans, then, upon the expiration of the
Interest Period therefor, such Loans or the portions thereof
for which an election to continue or convert has not been
made will be automatically converted to Base Rate Loans.
Each Notice of Conversion or Continuation shall be
irrevocable.
3.2. Interest. The Borrower shall pay interest
--------
on the unpaid principal amount of each Loan from the date
thereof until the principal amount thereof shall be paid in
full, at the following rates per annum:
(a) Base Rate Loans. For Base Rate Loans, at a
---------------
rate per annum equal at all times to the Base Rate in
effect from time to time, payable quarterly in arrears
on the last day of each September, December, March and
June, on the Commitment Termination Date and on the
date any Base Rate Loan is converted or paid in full.
(b) Eurodollar Rate Loans. For Eurodollar Rate
---------------------
Loans, at a rate per annum equal at all times during
the applicable Interest Period for each Eurodollar Rate
Loan to the sum of the Eurodollar Rate for such
-24-
Interest Period plus the Applicable Eurodollar Rate
Margin, payable in arrears (i) on the last day of such
Interest Period and (ii) if such Interest Period has a
duration of more than three months, on each day during
such Interest Period that occurs every three months
from the first day of such Interest Period.
(c) Default Rate of Interest. If any amount of
------------------------
principal of any Loan is not paid when due, whether at
stated maturity, by acceleration or otherwise, the
interest rate applicable to any such amount shall be
increased by 2.00% per annum, payable on demand, and if
any interest, fee or other amount payable hereunder is
not paid when due, such amount shall bear interest at a
rate per annum equal at all times to the Base Rate in
effect from time to time plus 2% per annum payable on
demand.
3.3. Interest Rate Determination and Protection.
------------------------------------------
(a) In the event that the Eurodollar Rate is not available
from the Telerate Page, the Eurodollar Rate for each
Interest Period for Eurodollar Rate Loans shall be deter-
mined by the Administrative Agent on the basis of applicable
rates furnished to and received by the Administrative Agent
from the Reference Banks two Business Days before such
Interest Period. Each Reference Bank agrees to furnish to
the Administrative Agent timely information for the purpose
of determining each Eurodollar Rate. If any of the Refer-
ence Banks shall not furnish such timely information to the
Administrative Agent for the purpose of determining any such
interest rate, the Administrative Agent shall determine such
interest rate on the basis of timely information furnished
by the other Reference Bank or Reference Banks.
(b) The Administrative Agent shall give prompt
notice to the Borrower and the Banks of the applicable
interest rate determined by the Administrative Agent for
purposes of Section 3.2(a) or (b), and the applicable rate,
if any, furnished by each Reference Bank for the purpose of
determining the applicable interest rate under Section
3.2(b).
(c) If, with respect to Eurodollar Rate Loans,
the Banks holding the majority in principal amount of such
Loans determine in good faith and notify the Administrative
Agent that the Eurodollar Rate for any Interest Period will
not adequately reflect the cost to such Banks of making such
Loans or funding or maintaining their respective Eurodollar
Rate Loans for such Interest Period, the Administrative
Agent shall forthwith so notify the Borrower and the Banks,
whereupon
-25-
(i) each Eurodollar Rate Loan will automatically,
on the last day of the then existing Interest Period
therefor, convert into a Base Rate Loan unless the
Banks holding the majority in principal amount of such
Loans notify the Administrative Agent that the circum-
stances causing such conversion no longer exist and the
Borrower delivers a timely Notice of Conversion or
Continuation with respect to such Loans; and
(ii) the obligations of the Banks to make
Eurodollar Rate Loans or to convert Loans into
Eurodollar Rate Loans shall be suspended until the
Administrative Agent shall notify the Borrower and the
Banks that the circumstances causing such suspension no
longer exist.
3.4. Fees. (a) The Borrower will pay on the
----
last day of each Fiscal Quarter to each of the Banks
quarterly in arrears a fee (the "Commitment Fee") accruing
from the Effective Date until the Commitment Termination
Date, on such Bank's aggregate average daily unused
Commitment as in effect from time to time at the rate set
forth below opposite the Credit Rating applicable to the
Borrower on such date:
CREDIT RATING COMMITMENT FEE
------------- --------------
A-/A3 or better .1500%
BBB+/Baa1 .2000%
BBB/Baa2 .2250%
BBB-/Baa3 .2500%
BB+/Ba1 .3125%
BB/Ba2 .3750%
BB-/Ba3 or lower .5000%
; provided, however, that if the ratings assigned by S&P and
-------- -------
Moody's shall differ by one level, the Credit Rating shall
be the rating which is the higher level, or if they differ
by more than one level, the Credit Rating shall be the
rating that is one rating level immediately above the lower
of such ratings. Any change in the Credit Rating of the
Borrower shall be effective to adjust the Commitment Fee as
of the date such change is announced.
(b) The Borrower has agreed to pay to the Banks,
Managing Agents, Agents and Arrangers certain other fees
which are earned on the Effective Date and payable on the
Initial Funding Date or as separately agreed.
3.5. Increased Costs. (a) If, due to either
---------------
(i) the introduction of or any change (other than any change
by way of imposition or increase of reserve requirements
-26-
included in the Eurodollar Rate Reserve Percentage) in, or
in the interpretation of, any law or regulation or (ii) the
compliance with any guideline or request from any central
bank or other Governmental Authority (whether or not having
the force of law), there shall be any increase in the cost
(other than with respect to income, franchise or withholding
taxes or other taxes of a similar nature) to any Bank of
agreeing to make or making, funding or maintaining any
Eurodollar Rate Loans, then (A) such Bank shall, as soon as
such Bank becomes aware of such increased cost, but in any
event not later than 60 days after such increased cost was
incurred, deliver to the Borrower and the Administrative
Agent a certificate stating (1) the actual amount of such
increased cost incurred by such Bank and (2) that it is such
Bank's customary practice, from and after the date of this
Agreement, to charge its borrowers for increased costs
incurred by it; (B) the Borrower shall, within 30 days after
its receipt of such certificate, at its sole option, either
(1) pay to the Administrative Agent for the account of such
Bank amounts sufficient to compensate such Bank for the
increased cost incurred by it as set forth in the cer-
tificate referred to above or (2) replace such Bank in
accordance with the provisions of Section 3.10, provided
--------
that if the Borrower does not exercise the option specified
in clause (2) above within 30 days after receipt of the
certificate referred to above, then (x) such Bank shall
deliver to the Borrower and the Administrative Agent a
second certificate stating the increased cost incurred by
such Bank and (y) the Borrower shall promptly upon receipt
of such second certificate pay to the Administrative Agent
for the account of such Bank amounts sufficient to com-
pensate such Bank for such increased cost; and (C) such Bank
shall use its reasonable best efforts to designate another
of its then existing offices as its Applicable Lending
Office if the making of such designation would, without any
detrimental effect to such Bank, avoid the need for, or
reduce the amount of, future increased costs which are
probable of being incurred by such Bank. The amount of
increased costs payable by the Borrower to any Bank as
stated in any such certificate delivered to the Borrower and
the Administrative Agent pursuant to the provisions of this
Section 3.5(a) shall be conclusive and binding for all
purposes, absent manifest error. In determining any such
amount, such Bank may use reasonable averaging and
attribution methods. If the Borrower so notifies the
Administrative Agent within five Business Days after receipt
of any certificate delivered to the Borrower pursuant to the
provisions of this Section 3.5(a), the Borrower may either
(x) prepay in full all Eurodollar Rate Loans of such Bank
then outstanding in accordance with Section 3.8 and,
additionally, reimburse such Bank for such increased cost in
-27-
accordance with this Section 3.5(a) or (y) convert all
Eurodollar Rate Loans of all Banks then outstanding into
Base Rate Loans in accordance with Section 3.1 and,
additionally, reimburse such Bank for such increased cost in
accordance with this Section 3.5(a).
(b) If any Bank shall be required under Regula-
tion D to maintain reserves with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities,
then (i) such Bank shall, within 60 days after the end of
any Interest Period with respect to any Eurodollar Rate Loan
during which such Bank was so required to maintain such
reserves, deliver to the Borrower and the Administrative
Agent a certificate stating (A) that such Bank was required
to maintain reserves and as a result such Bank incurred
additional costs in connection with making Eurodollar Rate
Loans, (B) in reasonable detail, such Bank's computations of
the amount of additional interest payable by the Borrower
pursuant to the provisions of this Section 3.5(b)(ii) and
(C) that it is such Bank's customary practice, from and
after the date of this Agreement, to charge its borrowers
for reserves so maintained by it, and (ii) the Borrower
shall, promptly upon receipt of any such certificate, pay to
the Administrative Agent, for the account of such Bank,
additional interest on the unpaid principal amount of each
Eurodollar Rate Loan of such Bank outstanding during the
Interest Period with respect to which the above-referenced
certificate was delivered to the Borrower, at a rate per
annum equal to the difference obtained by subtracting
(x) the Eurodollar Rate for such Interest Period from
(y) the rate obtained by dividing such Eurodollar Rate by a
percentage equal to 100% minus the Eurodollar Rate Reserve
Percentage of such Bank for such Interest Period. The
amount of interest payable by the Borrower to any Bank as
stated in any certificate delivered to the Borrower and the
Administrative Agent pursuant to the provisions of this
Section 3.5(b) shall be conclusive and binding for all
purposes, absent manifest error.
(c) The payments required under Sections 3.5(a)
and (b) are in addition to any other payments and
indemnities required under this Agreement.
3.6. Illegality. Notwithstanding any other
----------
provision of this Agreement, if the introduction of or any
change in or in the interpretation of any law or regulation,
in each case after the date hereof, shall make it unlawful,
or any central bank or other Governmental Authority shall
assert that it is unlawful, for any Bank or its Eurodollar
Lending Office to make Eurodollar Rate Loans or to continue
to fund or maintain Eurodollar Rate Loans, then, on notice
-28-
thereof and demand therefor by such Bank to the Borrower
through the Administrative Agent, (i) the obligation of such
Bank to make or to continue Eurodollar Rate Loans and to
convert Base Rate Loans into Eurodollar Rate Loans shall be
suspended until such Bank through the Administrative Agent
shall notify the Borrower that the circumstances causing
such suspension no longer exist and (ii) the Borrower shall
forthwith prepay in full all Eurodollar Rate Loans of such
Bank then outstanding, together with interest accrued
thereon, unless the Borrower, within five Business Days of
such notice and demand, converts all Eurodollar Rate Loans
of all Banks then outstanding into Base Rate Loans in
accordance with the notice periods of Section 3.1; provided,
--------
however, that before making any such demand, each Bank
-------
agrees to use its reasonable best efforts to designate
another of its then existing offices as its Applicable
Lending Office if the making of such a designation would,
without any detrimental effect to such Bank, cause the
making of Eurodollar Rate Loans to not be subject to this
Section 3.6.
3.7. Capital Adequacy. If any Bank shall, at any
----------------
time, reasonably determine that (a) the adoption (i) after
the date of this Agreement, of any capital adequacy guide-
lines or (ii) at any time, of any other applicable law,
government rule, regulation or order regarding capital
adequacy of banks or bank holding companies, (b) any change
in (i) any of the foregoing or (ii) the interpretation or
administration of any of the foregoing by any Governmental
Authority, central bank or comparable agency or (c) com-
pliance with any policy, guideline, directive or request
regarding capital adequacy (whether or not having the force
of law and whether or not failure to comply therewith would
be unlawful) of any Governmental Authority, central bank or
comparable agency, would have the effect of reducing the
rate of return on the capital of such Bank to a level below
that which such Bank could have achieved but for such
adoption, change or compliance (taking into consideration
the policies of such Bank with respect to capital adequacy
in effect immediately before such adoption, change or
compliance) and (x) such reduction is as a consequence of
the Commitment of, or the making, converting or continuing
of any Loans by, such Bank hereunder and (y) such reduction
is reasonably deemed by such Bank to be material, then
(1) such Bank shall deliver to the Borrower and the Admin-
istrative Agent a certificate stating the reduction in the
rate of return such Bank will in the future suffer as a
result of its Commitment or the making, converting or
continuing any Loans by it to the Borrower hereunder and
(2) the Borrower shall, within 30 days after its receipt of
such certificate, at its sole option, either (A) pay to the
-29-
Administrative Agent for the account of such Bank from time
to time as specified by such Bank such amount as shall be
sufficient to compensate such Bank for such reduced return,
or (B) replace such Bank in accordance with the provisions
of Section 3.10; provided, however, that if the Borrower
-------- -------
does not exercise the option specified in clause (B) above
within 30 days after receipt of the certificate referred to
above, then (1) such Bank shall deliver to the Borrower and
the Administrative Agent a second certificate stating the
reduction in the rate of return of such Bank and (2) the
Borrower shall promptly pay, as specified by such Bank, to
the Administrative Agent for the account of such Bank
amounts sufficient to compensate such Bank for the reduction
in its rate of return. The amount stated in any certificate
delivered to the Borrower pursuant to the provisions of this
Section 3.7 shall be conclusive and binding for all pur-
poses, absent manifest error. In determining any such
amount, such Bank may use reasonable averaging and
attribution methods. The payments required under this
Section 3.7 are in addition to any other payments and
indemnities required hereunder.
3.8. Payments and Computations. (a) The
-------------------------
Borrower shall make each payment payable by it hereunder not
later than 11:00 A.M. (New York City time) on the day when
due, in Dollars, to the Administrative Agent at its address
referred to in Section 11.2 in immediately available funds
without set-off or counterclaim. The Administrative Agent
will promptly thereafter (but in any event on the same day)
cause to be distributed like funds relating to the payment
of principal or interest or fees ratably (other than amounts
payable pursuant to Section 3.5, 3.6 or 3.7) to the Banks
for the account of their respective Applicable Lending
Offices, and like funds relating to the payment of any other
amount payable to any Bank to such Bank for the account of
its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Payment
received by the Administrative Agent after 11:00 A.M.
(New York City time) shall be deemed to be received on the
next Business Day; provided, however, that the Admin-
-------- -------
istrative Agent shall use its reasonable best efforts to
invest any amounts so received by the Administrative Agent
in overnight investments satisfactory to the Borrower, and
any earnings on any such investments shall be for the
Borrower's account and may be credited against any interest
payable hereunder during such period.
(b) All computations of the Commitment Fee or of
interest based on the rate of interest specified in clause
(a) of the definition of Base Rate and of fees shall be made
by the Administrative Agent on the basis of a year of 365 or
-30-
366 days, as the case may be, and all computations of
interest based on the Eurodollar Rate or the Federal Funds
Rate shall be made by the Administrative Agent on the basis
of a year of 360 days, in each case for the actual number of
days (including the first day but excluding the last day)
occurring in the period for which such interest and fees are
payable. All computations of the Commitment Fee shall be
based on the aggregate average daily unused Commitment of
each Bank. Each determination by the Administrative Agent
of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
(c) Whenever any payment hereunder shall be
stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day,
and such extension of time shall in such case be included in
the computation of payment of interest or fees, as the case
may be.
(d) Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which
any payment is due to the Banks hereunder that the Borrower
will not make such payment in full, the Administrative Agent
may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Admin-
istrative Agent may, in reliance upon such assumption, cause
to be distributed to each Bank on such due date an amount
equal to the amount then due such Bank. If and to the
extent that the Borrower shall not have so made such payment
in full to the Administrative Agent, each Bank shall repay
to the Administrative Agent forthwith on demand such amount
distributed to such Bank together with interest thereon, for
each day from the date such amount is distributed to such
Bank until the date such Bank repays such amount to the
Administrative Agent, at the Federal Funds Rate.
3.9. Sharing of Payments, Etc. If any Bank shall
-------------------------
obtain any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise) on
account of the Loan made by it (other than pursuant to
Section 3.5, 3.6 or 3.7) in excess of its Ratable Portion of
payments on account of the Loans obtained by all the Banks,
such Bank shall forthwith purchase from the other Banks such
participations in the Loans made by them as shall be neces-
sary to cause such purchasing Bank to share the excess
payment ratably with each of them; provided, however, that
-------- -------
if all or any portion of such excess payment is thereafter
recovered from such purchasing Bank, such purchase from each
Bank shall be rescinded and each such Bank shall repay to
the purchasing Bank the purchase price to the extent of such
recovery together with an amount equal to such Bank's
-31-
ratable share (according to the proportion of (i) the amount
of such Bank's required repayment to (ii) the total amount
so recovered from the purchasing Bank) of any interest or
other amount paid or payable by the purchasing Bank in
respect of the total amount so recovered. The Borrower
agrees that any Bank so purchasing a participation from
another Bank pursuant to this Section 3.9 may, to the
fullest extent permitted by law, exercise all its rights of
payment (including the right of set-off) with respect to
such participation as fully as if such Bank were the direct
creditor of the Borrower in the amount of such
participation.
3.10. Replacement Banks. Upon the election of
-----------------
the Borrower to replace any Bank pursuant to the provisions
of Section 3.5(a)(B)(2) or 3.7(2)(B), the Borrower shall
provide to the Administrative Agent a notice setting forth
the replacement Bank or Banks, and the Bank being so
replaced shall take all actions as may be necessary to
transfer to such replacement Bank or Banks all of the rights
and obligations of such Bank hereunder and such replacement
Bank or Banks shall pay to the Bank being so replaced the
amount outstanding of the Loan made by such Bank hereunder
(with appropriate provisions for other amounts due to the
Bank being replaced), all as though such replacement Bank or
Banks were an assignee or assignees of such Bank to which
such Bank were making an assignment in accordance with the
provisions of Section 11.7.
ARTICLE IV
CONDITIONS OF LENDING
4.1. Conditions Precedent to the Making of the
-----------------------------------------
Initial Loans. The making of the initial Loans hereunder is
-------------
subject to satisfaction of the conditions precedent that the
Managing Agents shall have received the following, in form
and substance satisfactory to the Managing Agents, and in
sufficient copies for each Bank that requests a copy:
(a) Certified copies of (i) the resolutions of
the Board of Directors of each Loan Party approving
each Loan Document to which it is a party, and (ii) all
documents evidencing any other necessary corporate
action and required governmental and any third party
approvals, licenses and consents with respect to each
Loan Document to which it is a party.
(b) A copy of the certificate of incorporation of
each Loan Party certified as of a recent date by the
-32-
Secretary of State of such Person's jurisdiction of
incorporation, together with certificates of such
official attesting to the good standing of such Person,
and a copy of the By-Laws of each such Person certified
by its Secretary or one of its Assistant Secretaries.
(c) A certificate of the Secretary or an
Assistant Secretary of each Loan Party certifying the
names and true signatures of its officers who have been
authorized to execute and deliver each Loan Document to
which it is a party and each other document and
certificate to be executed or delivered hereunder on
behalf of such Person.
(d) A favorable opinion of (i) Shearman &
Sterling, special counsel to the Loan Parties, in
substantially the form of Exhibit E-1 hereto, and
(ii) of Philippe P. Dauman, General Counsel to the Loan
Parties, in substantially the form of Exhibit E-2
hereto.
(e) A duly executed VII Guarantee.
(f) A duly executed Paramount Guarantee.
(g) Evidence satisfactory to the Managing Agents
that the Merger has been declared effective by the
State of Delaware.
4.2. Additional Conditions Precedent to the
--------------------------------------
Making of the Initial Loans. The making of the initial
---------------------------
Loans hereunder is subject to the further conditions
precedent that on the date of such Loans the following
statements shall be true:
(a) The Borrower shall have paid all costs,
accrued and unpaid fees and expenses referred to in
Sections 3.4 and 11.4 (including, without limitation,
the legal fees and expenses referred to in Section
11.4(a)), in each case to the extent then due and
payable.
(b) All Indebtedness of Blockbuster under the
Existing Blockbuster Credit Agreements shall have been
(or shall simultaneously be) repaid and all commitments
thereunder cancelled.
(c) Amendment No. 2, dated as of the date hereof,
to the Agreement referred to in clause (i) of the
definition of July Agreements shall be effective.
-33-
4.3. Conditions Precedent to the Making of Each
------------------------------------------
Loan. The obligation of each Bank to make any Loan,
----
including the initial Loans, shall be subject to the further
conditions precedent that the following statements shall be
true on the date of such Loan, before and after giving
effect thereto and to the application of the proceeds
therefrom (and the acceptance by the Borrower of the
proceeds of such Loan shall constitute a representation and
warranty by the Borrower that on the date of such Loan such
statements are true):
(a) The representations and warranties contained
in Article V hereof (other than those stated to be made
as of a particular date) are true and correct in all
material respects on and as of such date as though made
on and as of such date.
(b) No event has occurred and is continuing, or
would result from the Loans being made on such date,
which constitutes a Default or an Event of Default.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
To induce the Banks to enter into this Agreement,
the Borrower represents and warrants to the Banks as
follows:
5.1. Corporate Existence; Compliance with Law.
----------------------------------------
The Borrower, each other Loan Party and each other Material
Subsidiary (i) is a corporation duly incorporated, validly
existing and in good standing under the laws of the
jurisdiction of its incorporation; (ii) is duly qualified
and in good standing as a foreign corporation under the laws
of each other jurisdiction in which the failure so to
qualify is reasonably probable to have a Material Adverse
Effect; (iii) has all requisite corporate power and
authority to conduct its business as now being conducted and
as proposed to be conducted; (iv) is in compliance with its
articles or certificate of incorporation and by-laws; and
(v) is in compliance with all applicable Requirements of Law
except such non-compliance as would not have a Material
Adverse Effect.
5.2. Corporate Power; Authorization; Enforceable
-------------------------------------------
Obligations. (a) The execution, delivery and performance
-----------
by each Loan Party of this Agreement or any other Loan
Document to which it is a party:
-34-
(i) are within its corporate powers;
(ii) have been duly authorized by all necessary
corporate action;
(iii) do not (A) contravene its certificate of
incorporation or by-laws, (B) violate any law or
regulation (including, without limitation, Regulations
G, T, U or X of the Board of Governors of the Federal
Reserve System), or any order or decree of any court or
governmental instrumentality, except those as to which
the failure to comply would not have a Material Adverse
Effect, (C) conflict with or result in the breach of,
or constitute a default under, any instrument, document
or agreement binding upon and material to such Loan
Party, or (D) result in the creation or imposition of
any Lien upon any of the Property of the Borrower or
any of its Subsidiaries; and
(iv) do not require the consent of, authorization
by, approval of, notice to, or filing or registration
with, any Governmental Authority (except for filing
copies of Loan Documents with the Securities and
Exchange Commission).
(b) This Agreement and each other Loan Document
has been duly executed and delivered by each Loan Party that
is a party hereto or thereto, and is the legal, valid and
binding obligation of each such Person, enforceable against
it in accordance with its terms, except where such
enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or
limiting creditors' rights generally or equitable principles
relating to enforceability.
5.3. Taxes. All federal, and all material state,
-----
local and foreign tax returns, reports and statements
required to be filed by the Borrower or any of its Sub-
sidiaries have been filed with the appropriate governmental
agencies in all jurisdictions in which such returns, reports
and statements are required to be filed. All consolidated,
combined or unitary returns which include the Borrower or
any of its Subsidiaries have been filed with the appropriate
governmental agencies in all jurisdictions in which such
returns, reports and statements are required to be filed
except where such filing is being contested or may be
contested. All federal, and all material state, local and
foreign taxes, charges and other impositions of the Bor-
rower, its Subsidiaries or any consolidated, combined or
unitary group which includes the Borrower or any of its
Subsidiaries which are due and payable have been timely paid
-35-
prior to the date on which any fine, penalty, interest, late
charge or loss may be added thereto for non-payment thereof
except where contested in good faith and by appropriate
proceedings if adequate reserves therefor have been
established on the books of the Borrower or such Subsidiary
in accordance with GAAP. Proper and accurate amounts have
been withheld by or on behalf of the Borrower and each of
its Subsidiaries from their respective employees for all
periods in full and complete compliance with the tax, social
security and unemployment withholding provisions of
applicable federal, state, local and foreign law and such
withholdings have been timely paid to the respective
governmental agencies, in all material respects. Neither
the Borrower nor any of its Tax Affiliates has agreed or has
been requested to make any adjustment under Section 481(a)
of the Code by reason of a change in accounting method or
otherwise relating to the Borrower or any of its Subsidi-
aries which will affect a taxable year of the Borrower or a
Tax Affiliate ending after December 31, 1993, which has not
been reflected in the financial statements delivered
pursuant to Section 7.8 and which would have a Material
Adverse Effect. The Borrower has no obligation under any
tax sharing agreement or other tax sharing arrangement,
other than the Tax Sharing Agreement and tax sharing
agreements or other tax sharing arrangements providing for
payments to Subsidiaries of the Borrower which are Tax
Affiliates, which do not have a Material Adverse Effect.
5.4. Financial Information. (a) The reports of
---------------------
the Borrower on Form 10-K for the Fiscal Year ended
December 31, 1993 as amended by Amendment No. 1 on Form
10-K/A dated May 2, 1994 and on Form 10-Q for the Fiscal
Quarter ended June 30, 1994 are respectively complete and
correct in all material respects as of such respective
dates, and the financial statements therein have been
prepared in accordance with GAAP and fairly present the
financial condition and results of operations of the
Borrower and its consolidated Subsidiaries as of such
respective dates (subject, in the case of such reports on
Form 10-Q, to changes resulting from normal year-end
adjustments).
(b) Since June 30, 1994, there has been no
Material Adverse Change or Material Credit Agreement Change.
(c) None of the Borrower or any Subsidiary of the
Borrower had at June 30, 1994 any obligation, contingent
liability, or liability for taxes or long-term leases
material to the Borrower and its Subsidiaries taken as a
whole which is not reflected in the balance sheets referred
to in subsection (a) above or in the notes thereto.
-36-
5.5. Litigation. There are no pending, or to the
----------
best knowledge of the Borrower threatened, actions,
investigations or proceedings against or affecting the
Borrower or any of its Subsidiaries before any court,
governmental agency or arbitrator in which, individually or
in the aggregate, there is a reasonable probability of an
adverse decision that could have a Material Adverse Effect
or result in a Material Credit Agreement Change.
5.6. Margin Regulations. The Borrower is not
------------------
engaged in the business of extending credit for the purpose
of purchasing or carrying Margin Stock, and no proceeds of
any Borrowing will be used to purchase or carry any Margin
Stock or to extend credit to others for the purpose of
purchasing or carrying any Margin Stock in violation of
Regulation U.
5.7. ERISA. (a) No liability under
-----
Sections 4062, 4063, 4064 or 4069 of ERISA has been or is
expected by the Borrower to be incurred by the Borrower or
any ERISA Affiliate with respect to any Plan which is a
Single-Employer Plan in an amount that could reasonably be
expected to have a Material Adverse Effect.
(b) No Plan which is a Single-Employer Plan had
an accumulated funding deficiency, whether or not waived, as
of the last day of the most recent fiscal year of such Plan
ended prior to the date hereof. Neither the Borrower nor
any ERISA Affiliate is (A) required to give security to any
Plan which is a Single-Employer Plan pursuant to Sec-
tion 401(a)(29) of the Code or Section 307 of ERISA, or
(B) subject to a Lien in favor of such a Plan under Section
302(f) of ERISA.
(c) Each Plan of the Borrower, each of its
Subsidiaries and each of its ERISA Affiliates is in
compliance in all material respects with the applicable
provisions of ERISA and the Code, except where the failure
to comply would not result in any Material Adverse Effect.
(d) Neither the Borrower nor any of its
Subsidiaries has incurred a tax liability under Section 4975
of the Code or a penalty under Section 502(i) of ERISA in
respect of any Plan which has not been paid in full, except
where the incurrence of such tax or penalty would not result
in a Material Adverse Effect.
(e) None of the Borrower, any of its Subsidiaries
or any ERISA Affiliate has incurred or reasonably expects to
incur any Withdrawal Liability under Section 4201 of ERISA
as a result of a complete or partial withdrawal from a
-37-
Multiemployer Plan which will result in Withdrawal Liability
to the Borrower, any of its Subsidiaries or any ERISA
Affiliate in an amount that could reasonably be expected to
have a Material Adverse Effect.
5.8. No Defaults. Neither the Borrower nor any
-----------
of its Subsidiaries is in breach of or default under or with
respect to any instrument, document or agreement binding
upon the Borrower or such Subsidiary which breach or default
is reasonably probable to have a Material Adverse Effect or
result in the creation of a Lien on any Property of the
Borrower or its Subsidiaries.
5.9. Investment Company Act. The Borrower is not
----------------------
an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment
company", as such terms are defined in the Investment
Company Act of 1940, as amended. The making of the Loans by
the Banks, the application of the proceeds and repayment
thereof by the Borrower and the consummation of the trans-
actions contemplated by this Agreement will not violate any
provision of such act or any rule, regulation or order
issued by the Securities and Exchange Commission thereunder.
5.10. Insurance. All policies of insurance of
---------
any kind or nature owned by the Borrower and its Sub-
sidiaries are maintained with financially sound and
reputable insurers. The Borrower currently maintains
insurance with respect to its Properties and business and
causes its Subsidiaries to maintain insurance with respect
to their Properties and business against loss or damage of
the kinds customarily insured against by corporations
engaged in the same or similar business and similarly
situated, of such types and in such amounts as are
customarily carried under similar circumstances by such
other corporations including, without limitation, workers'
compensation insurance.
5.11. Environmental Protection. (a) There are
------------------------
no known conditions or circumstances associated with the
currently or previously owned or leased properties or
operations of the Borrower or its Subsidiaries or tenants
which may give rise to any Environmental Liabilities and
Costs which would have a Material Adverse Effect; and
(b) No Environmental Lien has attached to any
Property of the Borrower or any of its Subsidiaries which
would have a Material Adverse Effect.
5.12. Title and Liens. Each of the Borrower and
---------------
each of its Subsidiaries has good and marketable title to
-38-
its real properties and owns or leases under Capitalized
Leases all its other material Properties, in each case, as
shown on its most recent balance sheet, and none of such
Properties is subject to any Lien except as permitted under
this Agreement.
5.13. Trademarks, Copyrights, Etc. The Borrower
----------------------------
and each of its Subsidiaries own or have the rights to such
trademarks, service marks, trade names, copyrights, licenses
or rights in any thereof, as in the aggregate are adequate
in the reasonable judgment of the Borrower for the conduct
of the business of the Borrower and its Subsidiaries as now
conducted.
5.14. FCC Licenses, Franchises. The Borrower and
------------------------
its Subsidiaries have all the FCC Licenses necessary for the
conduct of their respective businesses as now being
conducted. The Borrower and its Subsidiaries are in
substantial compliance with the Federal Communications Act
of 1934, as amended, and with the rules and regulations
thereunder except for such non-compliance which would not
have a Material Adverse Effect. Neither the Borrower nor
any of its Subsidiaries is a party to, nor has any knowledge
of, any investigation, notice of violation, order or
complaint issued by or before the FCC, in which there is a
reasonable probability of an adverse decision which is
reasonably probable to have a Material Adverse Effect. The
operation and maintenance of the towers and any antenna
systems relating to each of the broadcast Properties owned
by the Borrower and its Subsidiaries or used in connection
with the transmission of signals therefrom do not violate
any Requirement of Law except for such non-compliance which
would not have a Material Adverse Effect. The Borrower and
its Subsidiaries have all the Franchises necessary for the
conduct of their businesses as now being conducted and are
in substantial compliance with the requirements of such
Franchises, except for such non-compliance which would not
have a Material Adverse Effect. The Borrower and its
Subsidiaries have no reason to believe that any FCC License
or any Franchise of the Borrower and its Subsidiaries will
not be renewed in the ordinary course except for such
nonrenewal which would not have a Material Adverse Effect.
5.15. Disclosure. All written information
----------
relating to the Borrower and its Subsidiaries and
Blockbuster and its Subsidiaries which has been delivered to
the Banks in connection with the Loan Documents prior to the
Initial Funding Date was complete and correct in all
material respects, taken as a whole. Any financial
projections and other information regarding anticipated
future plans or developments contained therein was based
-39-
upon good faith estimates and assumptions believed by the
Borrower to be reasonable at the time made, it being
recognized by the Banks that such projections and other
information regarding future events are not to be viewed as
facts and that actual results or developments during the
period or periods covered may differ from the delivered
projections and other prospective information.
ARTICLE VI
FINANCIAL COVENANTS
As long as any of the Loans shall remain unpaid or
any Bank shall have any Commitment hereunder, unless
otherwise agreed by the written consent of the Majority
Banks:
6.1. Total Leverage Ratio. The Total Leverage
--------------------
Ratio shall not exceed, as of the last day of any Fiscal
Quarter described below, the amount specified with respect
to such period:
Date Ratio
---- -----
December 31, 1994 6.50x
March 31, 1995 through 6.25x
September 30, 1995
December 31, 1995 5.75x
March 31, 1996 through 5.25x
December 31, 1997
March 31, 1998 through 4.50x
December 31, 1998
March 31, 1999 and 4.00x
Thereafter
6.2. Ratio of EBIDT to Trailing Total Cash
-------------------------------------
Interest and Preferred Dividends. The ratio of EBIDT to
--------------------------------
Total Cash Interest and Preferred Dividends shall not be
less, as of the last day of any Fiscal Quarter occurring
during any period set forth below, than the amount specified
with respect to such period:
Date Ratio
---- -----
December 31, 1994 1.75x
March 31, 1995 through December 31, 1996 2.00x
March 31, 1997 and thereafter 2.25x
6.3. Minimum Net Worth. On the last day of each
-----------------
Fiscal Quarter, commencing September 30, 1994, the Net Worth
of the Borrower and its Subsidiaries shall not be less than
-40-
75% of the Net Worth of the Borrower and its Subsidiaries at
the date which is the first Fiscal Quarter end date after
the Effective Date.
ARTICLE VII
AFFIRMATIVE COVENANTS
As long as any of the Loans shall remain unpaid or
any Bank shall have any Commitment hereunder, unless
otherwise agreed by the written consent of the Majority
Banks:
7.1. Compliance with Laws, Etc. The Borrower
--------------------------
shall comply, and cause each of its Subsidiaries to comply,
in all material respects with all Requirements of Law, all
FCC Licenses and Franchises except such non-compliance as
would not have a Material Adverse Effect or result in a
Material Credit Agreement Change.
7.2. Payment of Taxes, Etc. The Borrower and any
----------------------
consolidated, combined or unitary group which includes the
Borrower or any of its Subsidiaries shall pay and discharge,
and cause each Subsidiary of the Borrower to pay and
discharge, before the same shall become delinquent, all
lawful claims, taxes, assessments and governmental charges
or levies except where contested in good faith, by proper
proceedings, and where adequate reserves therefor have been
established on the books of the Borrower or such Subsidiary
in accordance with GAAP.
7.3. Maintenance of Insurance. The Borrower
------------------------
shall maintain, and cause each of its Subsidiaries to
maintain, insurance with responsible and reputable insurance
companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general
areas in which the Borrower or such Subsidiary operates.
The Borrower will furnish to the Administrative Agent from
time to time such information as may be requested as to such
insurance.
7.4. Preservation of Corporate Existence, Etc.
-----------------------------------------
The Borrower shall preserve and maintain, and cause each of
its Subsidiaries to preserve and maintain, their respective
corporate existences; provided, however, that the corporate
-------- -------
existence of any Subsidiary (other than a Guarantor Sub-
sidiary) may be terminated if, in the good faith judgment of
the board of directors or the chief financial officer of the
Borrower, such termination is in the best interest of the
-41-
Borrower and such termination would not have a Material
Adverse Effect; and provided further, however, that the
--- -------- ------- -------
Borrower may merge into Viacom International, with Viacom
International as the surviving corporation, provided that
--------
upon the effectiveness of such merger, Viacom International
shall assume, pursuant to an instrument satisfactory to the
Managing Agents, the obligations of the Borrower hereunder
and under the other Loan Documents.
7.5. Books and Access. The Borrower shall, and
----------------
shall cause each of its Subsidiaries to, keep proper books
of record and accounts in conformity with GAAP, and upon
reasonable notice and at such reasonable times during the
usual business hours as often as may be reasonably
requested, permit representatives of the Administrative
Agent, at its own initiative or at the request of any Bank,
to make inspections of its Properties, to examine its books,
accounts and records and make copies and memoranda thereof
and to discuss its affairs and finances with its officers or
directors and independent public accountants.
7.6. Maintenance of Properties, Etc. The
-------------------------------
Borrower shall maintain and preserve, and cause each of its
Subsidiaries to maintain and preserve, all of its Properties
which are used or useful in the conduct of its business in
good working order and condition and, from time to time make
or cause to be made all appropriate repairs, renewals and
replacements, except where the failure to do so would not
have a Material Adverse Effect.
7.7. Application of Proceeds. The Borrower shall
-----------------------
use the proceeds of the Loans (i) to refinance Existing
Blockbuster Credit Agreements and (ii) for other general
corporate purposes.
7.8. Financial Statements. The Borrower shall
--------------------
furnish to the Banks:
(a) as soon as available but not later than sixty
(60) days after the close of each of the first three (3)
Fiscal Quarters of each Fiscal Year of the Borrower,
(i) consolidated balance sheets of the Borrower and its
Subsidiaries as at the end of such Fiscal Quarter and the
related consolidated statements of operations, the
consolidated statement of shareholders' equity and the
consolidated statement of cash flows of the Borrower and its
Subsidiaries for such Fiscal Quarter and (in the case of the
second and third Fiscal Quarters) for the period from the
beginning of the then current Fiscal Year to the end of such
Fiscal Quarter (along with business segment information
customarily prepared by the Borrower), setting forth in each
-42-
case in comparative form the consolidated figures for the
corresponding periods of the previous Fiscal Year, all in
reasonable detail and certified by a Responsible Financial
Officer of the Borrower as fairly presenting, in accordance
with GAAP, the financial condition and results of operations
of the Borrower and its Subsidiaries, subject to changes
resulting from normal year-end audit adjustments; and (ii) a
report certified by such Responsible Financial Officer of
all commitments for program license fees that are not
reflected on the balance sheets referred to above in excess
of Fifty Million Dollars ($50,000,000) for any one such
commitment or series of related commitments incurred by the
Borrower or any Subsidiary during such Fiscal Quarter,
together with a statement of all such obligations
outstanding at the end of such Fiscal Quarter;
(b) (i) as soon as available but no later than
one hundred twenty (120) days after the close of each Fiscal
Year of the Borrower, (A) consolidated balance sheets of the
Borrower and its Subsidiaries as at the end of such year and
the related consolidated statements of operations, the
consolidated statement of shareholders' equity and the
consolidated statement of cash flows of the Borrower and its
Subsidiaries for such year (along with business segment
information customarily prepared by the Borrower), setting
forth in each case in comparative form the consolidated
figures for the previous Fiscal Year, all in reasonable
detail and certified in the case of the consolidated
financial statements by Price Waterhouse or another firm of
nationally recognized independent public accountants, which
report shall state without qualification as to the scope of
the audit or as to going concern that such consolidated
financial statements present fairly the financial position
and the results of operations as at the dates and for the
periods indicated in conformity with GAAP and that the audit
by such accountants in connection with such consolidated
financial statements has been made in accordance with GAAS,
and (B) a report certified by a Responsible Financial
Officer of all commitments for program license fees that are
not reflected on the balance sheets referred to above in
excess of Fifty Million Dollars ($50,000,000) for any one
such commitment or series of related commitments incurred by
the Borrower or any Subsidiary during the last Fiscal
Quarter of such Fiscal Year, together with a statement of
all such obligations at the end of such Fiscal Quarter;
(ii) as soon as available but not later than one hundred
twenty (120) days after the close of each Fiscal Year of the
Borrower, a certificate from such accounting firm that in
the course of the regular audit of the business of the
Borrower and its Subsidiaries, which audit was conducted by
such accounting firm in accordance with GAAS, such
-43-
accounting firm obtained no knowledge that an Event of
Default or Default has occurred and is continuing or, if in
the opinion of such accounting firm, an Event of Default or
Default has occurred and is continuing, a statement as to
the nature thereof;
(c) together with each delivery of financial
statements of the Borrower pursuant to clauses (a) and (b)
above and commencing with the Fiscal Quarter ending
December 31, 1994, a certificate issued by a Responsible
Financial Officer of the Borrower (i) demonstrating
compliance at the end of the accounting period described in
such statements with the financial covenants contained
herein and (ii) containing in reasonable detail the com-
ponent figures contained in the respective total figures
stated in such certificate;
(d) together with each delivery of financial
statements of the Borrower and its Subsidiaries pursuant to
clauses (a) or (b) above, and commencing with the Fiscal
Quarter ending September 30, 1994, a certificate signed by a
Responsible Financial Officer of the Borrower stating that
(i) such officer is familiar with both this Agreement and
the business and financial condition of the Borrower, and
(ii) no Event of Default or Default has occurred and is
continuing or if an Event of Default or Default has occurred
and is continuing a statement as to the nature thereof, and
whether or not the same shall have been cured; and
7.9. Reporting Requirements. The Borrower shall
----------------------
furnish to the Administrative Agent for distribution to the
Banks:
(a) from time to time as the Administrative Agent
may reasonably request, copies of such statements, lists of
Property, accounts, budgets, forecasts, reports or informa-
tion prepared by or for the Borrower or within the
Borrower's control;
(b) promptly and in any event within thirty
(30) days after the Borrower, any of its Subsidiaries or any
ERISA Affiliate knows that any ERISA Event has occurred
(other than a Reportable Event for which notice to the PBGC
is waived), a written statement of the chief financial
officer or other appropriate officer of the Borrower
describing such ERISA Event and the action, if any, which
the Borrower, any of its Subsidiaries or any ERISA Affiliate
proposes to take with respect thereto, and a copy of any
notice filed with the PBGC or the IRS pertaining thereto;
-44-
(c) promptly and in any event within thirty (30)
days after notice or knowledge thereof, notice that the
Borrower or any of its Subsidiaries becomes subject to the
tax on prohibited transactions imposed by Section 4975 of
the Code, together with a copy of Form 5330;
(d) promptly after the commencement thereof,
notice of all actions, suits and proceedings before any
court or governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign, against or
affecting the Borrower or any of its Subsidiaries, in which
there is a reasonable probability of an adverse decision
which would have a Material Adverse Effect;
(e) promptly upon the Borrower or any of its
Subsidiaries learning of (i) any Event of Default or any
Default, or (ii) any Material Credit Agreement Change,
telephonic or telegraphic notice specifying the nature of
such Event of Default, Default or Material Credit Agreement
Change, including the anticipated effect thereof, which
notice shall be promptly confirmed in writing within five
days;
(f) promptly after the sending or filing thereof,
copies of all reports which the Borrower sends to its
security holders generally, and copies of all reports and
registration statements which the Borrower or any of its
Subsidiaries files with the Securities and Exchange
Commission or any national securities exchange;
(g) promptly upon, and in any event within
30 days of, the Borrower or any of its Subsidiaries learning
of any of the following:
(i) notice that any Property of the Borrower or
any of its Subsidiaries is subject to any Environmental
Liens individually or in the aggregate which would have
a Material Adverse Effect;
(ii) any proposed acquisition of stock, assets or
real estate, or any proposed leasing of Property, or
any other action by the Borrower or any of its Subsidi-
aries in which there is a reasonable probability that
the Borrower or any of its Subsidiaries would be
subject to any material Environmental Liabilities and
Costs, provided that, in the event of any such proposed
--------
acquisition or lease, the Borrower must furnish to the
Banks evidence in a form acceptable to the Banks that
the proposed acquisition will not have a Material
Adverse Effect;
-45-
(h) prior to the effectiveness thereof, informa-
tion relating to any proposed change in the accounting
treatment or reporting practices of the Borrower and its
Subsidiaries the nature or scope of which materially affects
the calculation of any component of any financial covenant,
standard or term contained in this Agreement;
(i) promptly upon the Borrower learning of any
material Franchise or material FCC License being revoked,
canceled or terminated, or renewal thereof denied for any
reason, written notice specifying the reasons for such
revocation, cancellation, termination or denial, the
anticipated effect thereof, and the actions, if any, being
taken by the Borrower to remedy the same; and
(j) from time to time, such other information and
materials as the Administrative Agent may reasonably
request.
ARTICLE VIII
NEGATIVE COVENANTS
So long as any of the Loans shall remain unpaid or
any Bank shall have any Commitment hereunder, without the
written consent of the Majority Banks:
8.1. Liens, Etc. The Borrower shall not,
-----------
directly or indirectly, create or suffer to exist, or permit
any of its Subsidiaries to create or suffer to exist, any
Lien upon or with respect to any of its Properties, whether
now owned or hereafter acquired, or assign, or permit any of
its Subsidiaries to assign, any right to receive income, in
each case to secure or provide for the payment of any
Indebtedness of any Person, except:
(i) purchase money Liens or purchase money
security interests upon or in any Property acquired or
held by the Borrower or any Subsidiary of the Borrower
in the ordinary course of business to secure the
purchase price of such Property or to secure Indebt-
edness incurred solely for the purpose of financing the
acquisition of such Property;
(ii) Liens on Property of Blockbuster or any of
its Subsidiaries, or on Property of the Borrower or any
of its Subsidiaries that was Property of Blockbuster
prior to the Merger, in each case to the extent that
such Liens exist prior to the Merger;
-46-
(iii) Liens existing on Property at the time of
its acquisition (other than any such Lien created in
contemplation of such acquisition);
(iv) Liens on Property of Persons which become
Subsidiaries after the Initial Funding Date securing
Indebtedness existing, with respect to any such Person,
on the date such Person becomes a Subsidiary (other
than any such Lien created in contemplation of such
Person becoming a Subsidiary);
(v) Liens on Property of Persons which become
Subsidiaries after the Initial Funding Date securing
Indebtedness incurred by such Person after the date
such Person becomes a Subsidiary; provided, however,
-------- -------
that the aggregate principal amount of Indebtedness
referred to in this clause (v) secured by Liens shall
not exceed $30,000,000 at any time outstanding;
(vi) Liens upon or in the satellite transponders
listed on Schedule 8.1(a) (and directly related
Property) to secure the purchase price of such
transponders, or to secure Indebtedness incurred for
the purpose of financing or refinancing the acquisition
of such transponders;
(vii) Liens listed on Schedule 8.1(b); and
(viii) any Lien securing the renewal, extension
or refunding of any Indebtedness secured by any Lien
permitted by clause (i), (ii), (iii), (iv), (v), (vi)
or (vii) above.
8.2. Mergers. The Borrower shall not, nor shall
-------
it permit any of its Subsidiaries representing a substantial
portion of the assets of the Borrower and its Subsidiaries
taken as a whole to, merge or consolidate in any transaction
in which such entity is not the surviving Person other than:
(i) in mergers of any Subsidiary into the Borrower or any
other wholly owned Subsidiary of the Borrower; or (ii) in a
merger of the Borrower into Viacom International with Viacom
International as the surviving corporation, provided that
--------
upon the effectiveness of such merger, Viacom International
shall assume, pursuant to an instrument satisfactory to the
Managing Agents, the obligations of the Borrower hereunder
and under the other Loan Documents.
8.3. Substantial Asset Sale. The Borrower shall
----------------------
not, and shall not permit any of its Subsidiaries to, sell
assets constituting all or a substantial portion of consoli-
dated assets of the Borrower and its Subsidiaries taken as a
-47-
whole to any Person other than to the Borrower or its wholly
owned Subsidiary.
8.4. Transactions with Affiliates. The Borrower
----------------------------
shall not engage in, and will not permit any of its Subsidi-
aries to engage in, any transaction with an Affiliate of the
Borrower or of such Subsidiary (other than transactions in
the ordinary course of business between a Subsidiary and its
parent or among Subsidiaries of the Borrower) except on
terms no less favorable to the Borrower or such Subsidiaries
than as would be obtained in a comparable arm's-length
transaction.
8.5. Margin Stock. The Borrower shall not permit
------------
more than twenty-five percent (25%) of the value, within the
meaning of Regulation U, as determined by any reasonable
method, of the assets of the Borrower and its Subsidiaries,
or of any Guarantor Subsidiary, to be Margin Stock, nor will
the Borrower use the proceeds of any Loan to purchase or
carry any Margin Stock in violation of Regulation U.
8.6. Subsidiary Indebtedness. The Borrower shall
-----------------------
not permit any of its Subsidiaries, other than a Guarantor
Subsidiary, to incur Indebtedness for borrowed money other
than the Subsidiary Loans (as defined in the July
Agreements) or under existing facilities identified on
Schedule 8.6 or any replacement facilities thereto which in
the aggregate do not exceed the amounts of the commitments
reflected on such Schedule.
8.7. Other Restrictions on Indebtedness. The
----------------------------------
Borrower shall not, and shall not permit any Subsidiary
Guarantor to, incur Indebtedness for borrowed money (other
than Commercial Paper) maturing earlier than six months
after the Commitment Termination Date and on terms no more
onerous than the terms hereof provided however, that the
-------- -------
Borrower may become an obligor under the 6.625% Senior
Blockbuster Notes.
ARTICLE IX
EVENTS OF DEFAULT
9.1. Events of Default. If any of the following
-----------------
events ("Events of Default") shall occur and be continuing:
(a) The Borrower or any other Loan Party shall
fail to pay (i) any principal when due in accordance
with the terms and provisions of this Agreement or any
other Loan Document, or (ii) any interest on any
-48-
amounts due hereunder or thereunder, or any fee or any
other amount due hereunder or thereunder within three
Business Days after the same becomes due and payable;
or
(b) Any representation or warranty made by any
Loan Party in this Agreement or any other Loan Document
or by any Loan Party (or any of its officers) in
connection with this Agreement or any other Loan
Document shall prove to have been incorrect in any
material respect when made; or
(c) Any Loan Party shall fail to perform or
observe any term, covenant or agreement contained in
this Agreement or any other Loan Document, which
failure or change shall remain unremedied for fifteen
days after the earlier of the date on which (i) tele-
phonic or telegraphic notice thereof shall have been
given to the Administrative Agent by the Borrower
pursuant to Section 7.9(e), or (ii) written notice
thereof shall have been given to the Borrower by the
Administrative Agent or any Bank; or
(d) The Borrower or any of its Subsidiaries shall
fail to pay any principal of, or premium or interest
on, any Indebtedness in an aggregate principal amount
of $50,000,000 or more (excluding Indebtedness here-
under) of the Borrower or such Subsidiary, when the
same becomes due and payable (whether by scheduled
maturity, required prepayment, acceleration, demand or
otherwise); or any other event shall occur or condition
shall exist under any agreement or instrument relating
to any such Indebtedness, if the effect of such event
or condition is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness or
to terminate any commitment to lend; or any such
Indebtedness shall be declared to be due and payable,
or required to be prepaid (other than by a regularly
scheduled required prepayment), prior to the stated
maturity thereof and, with respect to all of the
foregoing, after the expiration of any applicable grace
period or the giving of any required notice or both;
provided, however, that no extension of any grace
-------- -------
period applicable to any such Indebtedness shall be
taken into account for the purposes of this
subsection (d); or
(e) There shall occur and be continuing an Event
of Default under (and as defined in) the July
Agreements; or
-49-
(f) The Borrower or any of its Material
Subsidiaries shall generally not pay its debts as such
debts become due, or shall admit in writing its ina-
bility to pay its debts generally, or shall make a
general assignment for the benefit of creditors, or any
proceedings shall be instituted by or against the
Borrower or any of its Material Subsidiaries seeking to
adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or
its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the
appointment of a receiver, trustee or other similar
official for it or for a material part of its Property
employed in its business or any writ, attachment,
execution or similar process shall be issued or levied
against a material part of the Property employed in the
business of the Borrower and its Subsidiaries taken as
a whole, and, in the case of any such proceedings
instituted against the Borrower or any of its Material
Subsidiaries (but not instituted by it), either such
proceedings shall remain undismissed or unstayed for a
period of 60 days or any of the actions sought in such
proceedings shall occur; or the Borrower or any of its
Material Subsidiaries shall take any corporate action
to authorize any of the actions set forth above in this
subsection (f); or
(g) Any order for the payment of money or
judgment of any court, not appealable or not subject to
certiorari or appeal (a "Final Judgment"), which, with
other outstanding Final Judgments, exceeds an aggregate
of $50,000,000 shall be rendered against the Borrower
or any of its Material Subsidiaries and, within 60 days
after entry thereof, such Final Judgment shall not have
been discharged; or
(h) (i) With respect to any Plan, a final
determination is made that a prohibited transaction
within the meaning of Section 4975 of the Code or
Section 406 of ERISA occurred which results in direct
or indirect liability of the Borrower or any of its
Material Subsidiaries, (ii) with respect to any Title
IV Plan, the filing of a notice to voluntarily
terminate any such plan in a distress termination,
(iii) with respect to any Multiemployer Plan, the
Borrower, any of its Material Subsidiaries or any of
its or their ERISA Affiliates shall incur any
Withdrawal Liability, or (iv) with respect to any
Qualified Plan, the Borrower, any of its Material
-50-
Subsidiaries or any of its or their ERISA Affiliates
shall incur an accumulated funding deficiency or
request a funding waiver from the IRS; provided,
--------
however, that the events listed in clauses (i)-(iv)
-------
hereof shall constitute Events of Default only if the
liability, deficiency or waiver request of the Bor-
rower, any of its Material Subsidiaries or any of its
or their ERISA Affiliates, as finally determined,
exceeds $25,000,000 in any case set forth in clauses
(i)-(iv) above, or exceeds $25,000,000 in the aggregate
for all such cases; and, provided further, however,
-------- ------- -------
that with respect to the events listed in clauses (i),
(iii) and (iv) hereof there shall be no Event of
Default if the liability of the Borrower, the relevant
Material Subsidiary or the relevant ERISA Affiliate is
satisfied in full or in accordance with the due dates
therefor; or
(i) (i) NAI shall fail to own of record and
beneficially not less than 51% of the outstanding stock
having ordinary voting power to elect a majority of the
board of directors of the Borrower and such failure of
NAI shall remain unremedied for fifteen days after the
earlier of the date on which (A) telephonic or tele-
graphic notice thereof shall have been given to the
Administrative Agent by the Borrower pursuant to
Section 7.9(e), or (B) written notice thereof shall
have been given to the Borrower by the Administrative
Agent or any Bank; or
(j) This Agreement or any other Loan Document
shall cease to be valid or enforceable for any reason
in any material respect;
then, and in any such event, the Administrative Agent
(i) shall at the request, or may with the consent, of the
Majority Banks, by notice to the Borrower, declare the
obligation of each Bank to make Loans to be terminated,
whereupon the same shall forthwith terminate, and (ii) shall
at the request, or may with the consent, of the Majority
Banks, by notice to the Borrower, declare all amounts due
under this Agreement and all interest thereon to be
forthwith due and payable, whereupon all amounts due under
this Agreement and all such interest and all such amounts
shall become and be forthwith due and payable; provided,
--------
however, that upon an actual or deemed entry of an order for
-------
relief with respect to the Borrower or any of its Material
Subsidiaries under the federal Bankruptcy Code, (A) the
obligation of each Bank to make Loans shall automatically be
terminated and (B) all amounts due under this Agreement and
all such interest and all such amounts shall automatically
-51-
and without further notice become and be due and payable.
In addition to the remedies set forth above, the Admin-
istrative Agent may exercise any other remedies provided for
by this Agreement in accordance with the terms hereof or any
other remedies provided by applicable law.
ARTICLE X
THE MANAGING AGENTS AND THE FACILITY AGENTS
10.1. Authorization and Action. Each Bank hereby
------------------------
appoints and authorizes each Facility Agent to take such
action as agent on its behalf and to exercise such powers
under this Agreement as are delegated to such Facility Agent
by the terms hereof, together with such powers as are
reasonably incidental thereto. As to any matters not
expressly provided for by this Agreement, no Facility Agent
shall be required to exercise any discretion or take any
action, but each shall be required to act or to refrain from
acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the
Majority Banks (or when expressly required hereunder, all
the Banks), and such instructions shall be binding upon all
Banks; provided, however, that no Facility Agent shall be
-------- -------
required to take any action that exposes such Facility Agent
to personal liability or that is contrary to this Agreement
or applicable law. Each Facility Agent agrees to give to
each Bank prompt notice of each notice given to it by the
Borrower pursuant to the terms of this Agreement.
10.2. Managing Agents' and Facility Agents'
-------------------------------------
Reliance, Etc. Neither the Managing Agents, the Facility
--------------
Agents, their Affiliates nor any of their respective
directors, officers, agents or employees shall be liable for
any action taken or omitted to be taken by any of them under
or in connection with this Agreement, except for its own
gross negligence or willful misconduct. Without limitation
of the generality of the foregoing, (i) any Managing Agent
or Facility Agent may consult with legal counsel (including
counsel to the Borrower), independent public accountants and
other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or
experts; (ii) neither the Managing Agents nor the Facility
Agents make any warranty or representation to any Bank and
none of them shall be responsible to any Bank for any
statements, warranties or representations made in or in
connection with this Agreement; (iii) neither the Managing
Agents nor the Facility Agents shall have any duty to
ascertain or to inquire as to the performance or observance
-52-
of any of the terms, covenants or conditions of this
Agreement on the part of the Borrower or to inspect the
Properties (including the books and records) of the Bor-
rower; (iv) neither the Managing Agents nor the Facility
Agents shall be responsible to any Bank for the due
execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instru-
ment or document furnished pursuant hereto; and (v) neither
the Managing Agents nor the Facility Agents shall incur
liability under or in respect of this Agreement by acting
upon any notice, consent, certificate or other instrument or
writing (which may be by telegram, cable or telex) believed
by it to be genuine and signed or sent by the proper party
or parties. The Agents shall, in their respective
capacities as such, have any duties under this Agreement
other than those that they have in their capacities as
Banks.
10.3. The Bank of New York, Citibank, N.A.,
-------------------------------------
Morgan Guaranty Trust Company of New York, Bank of America
----------------------------------------------------------
NT&SA and Their Affiliates. With respect to the Commitments
--------------------------
of The Bank of New York, Citibank, N.A., Morgan Guaranty
Trust Company of New York and Bank of America NT&SA,
respectively, and the Loans made by each of them, each of
The Bank of New York, Citibank, N.A., Morgan Guaranty Trust
Company of New York and Bank of America NT&SA shall have the
same rights and powers under this Agreement as any other
Bank and may exercise the same as though it were not a
Managing Agent or Facility Agent, as the case may be; and
the term "Bank" or "Banks" shall, unless otherwise expressly
indicated, include each of The Bank of New York, Citibank,
N.A., Morgan Guaranty Trust Company of New York and Bank of
America NT&SA in their individual capacities. Each of The
Bank of New York, Citibank, N.A., Morgan Guaranty Trust
Company of New York and Bank of America NT&SA and their
Affiliates may accept deposits from, lend money to, act as
trustee under indentures of, and generally engage in any
kind of business with, the Borrower, any of its Subsidiaries
and any Person who may do business with or own securities of
the Borrower or any such Subsidiary, all as if The Bank of
New York, Citibank, N.A., Morgan Guaranty Trust Company of
New York or Bank of America NT&SA, as the case may be, were
not a Managing Agent or Facility Agent, as the case may be,
and without any duty to account therefor to the Banks.
10.4. Bank Credit Decision. Each Bank
--------------------
acknowledges that it has, independently and without reliance
upon the Managing Agents, the Facility Agents, the
Arrangers, the Agents or any other Bank, and based on the
financial statements referred to in Article V and such other
documents and information as it has deemed appropriate, made
-53-
its own credit analysis and decision to enter into this
Agreement. Each Bank also acknowledges that it will, inde-
pendently and without reliance upon the Managing Agents, the
Facility Agents, the Arrangers, the Agents or any other Bank
and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this
Agreement.
10.5. Determinations Under Sections 4.1, 4.2 and
------------------------------------------
4.3. For purposes of determining compliance with the
---
conditions specified in Sections 4.1, 4.2 and 4.3, each Bank
shall be deemed to have consented to, approved or accepted,
or to be satisfied with each document or other matter
required thereunder to be consented to or approved by or
acceptable or satisfactory to the Banks unless an officer of
the Administrative Agent responsible for the transactions
contemplated by this Agreement shall have received notice
from such Bank prior to the applicable Borrowing specifying
its objection thereto (unless such objection shall have been
withdrawn by notice to the Administrative Agent to that
effect or such Bank shall have made available to the
Administrative Agent such Bank's ratable portion of such
Borrowing).
10.6. Indemnification. Each Bank agrees to
---------------
indemnify the Managing Agents, the Facility Agents, the
Arrangers and their respective Affiliates, and their
respective directors, officers, employees, agents and
advisors (to the extent not reimbursed by the Borrower),
ratably according to such Bank's Ratable Portion of the
Commitments, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements (including, without
limitation, fees and disbursements of legal counsel) of any
kind or nature whatsoever which may be imposed on, incurred
by, or asserted against, any such Person in any way relating
to or arising out of this Agreement or any action taken or
omitted by any such Person under this Agreement; provided,
--------
however, that no Bank shall be liable for any portion of
-------
such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements
resulting from any such Person's gross negligence or willful
misconduct or from any violation or alleged violation by any
such Person or any other Bank of any law, rule or regulation
or any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of
law) or, with respect to any Managing Agent or Facility
Agent, any conflict or alleged conflict between its rights
and duties in its capacity as such or as a Bank under this
Agreement and any other rights or duties it may have in any
-54-
other capacity in which it may act in connection with the
consummation of the transactions contemplated by this
Agreement, whether or not such Bank is a party to such
transactions. Without limitation of the foregoing, each
Bank agrees to reimburse any such Person promptly upon
demand for its ratable share of any out-of-pocket expenses
(including fees and disbursements of one counsel) incurred
by such Person in connection with the preparation, execu-
tion, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings
or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, to the extent that
such Person is not reimbursed for such expenses by the
Borrower.
10.7. Successor Facility Agents. Any Facility
-------------------------
Agent may resign at any time by giving written notice
thereof to the Banks and the Borrower and may be removed at
any time with or without cause by the Majority Banks. Upon
any such resignation or removal, the Majority Banks shall
have the right to appoint a successor to such Facility
Agent. If no successor to such Facility Agent shall have
been so appointed by the Majority Banks, and shall have
accepted such appointment, within 30 days after retiring
Facility Agent's giving of notice of resignation or the
Majority Banks' removal of such retiring Facility Agent,
then such retiring Facility Agent on behalf of the Banks,
shall appoint a successor Facility Agent (which successor
Facility Agent shall be a Bank or another commercial bank
organized under the laws of the United States of America or
of any State thereof and having a combined capital and
surplus of at least $50,000,000). Upon the acceptance of
any appointment as a Facility Agent hereunder by any
successor Facility Agent, such successor Facility Agent
shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring
Facility Agent, and such retiring Facility Agent shall be
discharged from its duties and obligations under this
Agreement. After any retiring Facility Agent's resignation
or removal hereunder, the provisions of this Article X shall
inure to its benefit as to any actions taken or omitted to
be taken by it while it was Facility Agent.
ARTICLE XI
MISCELLANEOUS
11.1. Amendments, Etc. (a) No amendment or
----------------
waiver of any provision of this Agreement, nor consent to
any departure by the Borrower therefrom, shall in any event
-55-
be effective unless the same shall be in writing and signed
by the Majority Banks, and then such waiver or consent shall
be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no
-------- -------
amendment, waiver or consent shall, unless in writing signed
by all the Banks, do any of the following: (a) waive any of
the conditions specified in Section 4.1, 4.2 or 4.3;
(b) increase the Commitments of the Banks or subject the
Banks to any additional obligations; (c) change the
principal of, or decrease the interest on, any amounts
payable hereunder or reduce the amount of any Commitment Fee
payable to the Banks hereunder; (d) postpone any date fixed
for any scheduled payment of Commitment Fee, or scheduled
payment of principal of, or interest on, any amounts,
payable hereunder; (e) change the definition of Majority
Banks; or (f) amend this Section 11.1; and provided further,
-------- -------
however, that no amendment, waiver or consent shall, unless
-------
in writing and signed by the Administrative Agent in addi-
tion to the Persons required above to take such action,
affect the rights or duties of the Administrative Agent
under this Agreement.
(b) The Borrower will not enter into any
amendment of the July Agreements with respect to provisions
that are also included in this Agreement, unless it shall
simultaneously therewith enter into a corresponding
amendment to this Agreement; and it will not pay or agree to
pay any compensation (either by way of direct payments or
agreements to increase fees or margins, or otherwise) in
connection with any such corresponding amendment of or
waiver under the July Agreements, unless proportionately
equal compensation is paid, or agreed to be paid, to the
Banks under this Agreement.
11.2. Notices, Etc. Except as otherwise set
-------------
forth herein, all notices and other communications provided
for hereunder shall be in writing (including telegraphic,
telex, telecopy or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered by
hand, if to the Borrower, at its address at 1515 Broadway,
New York, New York 10036, Attention: Treasurer; if to any
Bank, at its Domestic Lending Office specified opposite its
name on Schedule I; and if to the Administrative Agent, at
its address at 399 Park Avenue, 9th Floor, Zone 6, New York,
New York 10021, Attention: Margaret C. Ullrich; or, as to
the Borrower, any Bank or the Administrative Agent, at such
other address as shall be designated by such party in a
written notice to the other parties and, as to each other
party, at such other address as shall be designated by such
party in a written notice to the Borrower and the Adminis-
trative Agent. All such notices and communications shall,
-56-
when mailed, telegraphed, telexed, telecopied, cabled or
delivered, be effective when deposited in the mails,
delivered to the telegraph company, confirmed by telex
answerback, telecopied with confirmation of receipt,
delivered to the cable company or delivered by hand to the
addressee or its agent, respectively, except that notices
and communications to the Administrative Agent pursuant to
Article II or X shall not be effective until received by the
Administrative Agent.
11.3. No Waiver; Remedies. No failure on the
-------------------
part of any Bank, the Managing Agents or any Facility Agent
to exercise, and no delay in exercising, any right hereunder
shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right.
The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
11.4. Costs; Expenses; Indemnities. (a) The
----------------------------
Borrower agrees to pay on demand all costs and expenses in
connection with the preparation, execution, delivery,
administration, modification and amendment of this
Agreement, the other Loan Documents and the other documents
to be delivered hereunder or thereunder, including, without
limitation, the specified reasonable fees and out-of-pocket
expenses of one counsel to the Managing Agents and the
Facility Agents and the Arrangers with respect thereto and
with respect to advising the Managing Agents, the Facility
Agents and the Arrangers as to their rights and responsi-
bilities under this Agreement, and all costs and expenses of
the Managing Agents, the Facility Agents and the Banks
(including, without limitation, reasonable counsel fees and
expenses) in connection with the enforcement (whether
through negotiations, legal proceedings or otherwise) of
this Agreement, the other Loan Documents and the other
documents to be delivered hereunder and thereunder.
(b) The Borrower agrees to defend, indemnify and
hold harmless each of the Managing Agents, the Facility
Agents, the Arrangers and the Banks and their respective
affiliates and their respective directors, officers,
attorneys, agents, employees, successors and assigns (each,
an "Indemnified Person") from and against any and all
liabilities, obligations, losses, damages, penalties,
actions, claims, judgments, suits, costs, expenses and
disbursements of any kind or nature whatsoever (including,
without limitation, fees and disbursements of counsel of the
Managing Agents, the Facility Agents, the Arrangers or the
Banks) which may be incurred by or asserted or awarded
against any Indemnified Person, in each case arising in any
-57-
manner of or in connection with or by reason of this Agree-
ment, the other Loan Documents, the Commitments or any
undertakings in connection therewith, or the proposed or
actual application of the proceeds of the Loans (all of the
foregoing collectively, the "Indemnified Liabilities") and
will reimburse each Indemnified Person on a current basis
for all expenses (including counsel fees as they are
incurred by such party) in connection with investigating,
preparing or defending any such action, claim or suit,
whether or not in connection with pending or threatened
litigation irrespective of whether such Indemnified Person
is designated a party thereto; provided that the Borrower
--------
shall not have any liability hereunder to any Indemnified
Person with respect to Indemnified Liabilities which are
determined by a final and nonappealable judgment of a court
of competent jurisdiction to have arisen primarily from the
gross negligence or willful misconduct of such Indemnified
Person; and provided further, that if the Borrower has
-------- -------
determined in good faith that such Indemnified Liabilities
were primarily the result of such Indemnified Person's gross
negligence or willful misconduct, it shall not be obligated
to pay such Indemnified Liabilities until a court of
competent jurisdiction has determined whether such
Indemnified Person acted with gross negligence or willful
misconduct. If for any reason the foregoing indemnification
is unavailable to an Indemnified Person or insufficient to
hold an Indemnified Person harmless, then the Borrower shall
contribute to the amount paid or payable by such Indemnified
Person as a result of any Indemnified Liability in such
proportion as is appropriate to reflect not only the rela-
tive benefits received by the Borrower and each Managing
Agent, each Facility Agent, each Arranger and each Bank, but
also the relative fault of the Borrower and each Managing
Agent, each Facility Agent, each Arranger and each Bank, as
well as any other relevant equitable considerations. The
foregoing indemnity shall be in addition to any rights that
any Indemnified Person may have at common law or otherwise,
including, but not limited to, any right to contribution.
(c) If any Bank receives any payment of principal
of, or is subject to a conversion of, any Eurodollar Rate
Loan other than on the last day of an Interest Period
relating to such Loan, as a result of any payment or
conversion made by the Borrower or acceleration of the
maturity of the amounts due under this Agreement pursuant to
Section 9.1 or for any other reason, the Borrower shall,
upon demand by such Bank (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for
the account of such Bank any amounts required to compensate
such Bank for any additional losses, costs or expenses which
it may reasonably incur as a result of such payment or
-58-
conversion, including, without limitation, any loss
(excluding loss of the margin payable in accordance with
Section 3.2 on the amount of principal so paid, or any
loss), cost or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by such
Bank to fund or maintain such Loan. The foregoing obliga-
tions of the Borrower contained in paragraphs (a), (b) and
(c) of this Section 11.4, and the obligations of the Bor-
rower contained in Sections 3.5(b) and 3.7, shall survive
the payment of the Loans.
11.5. Right of Set-Off. Upon (i) the occurrence
----------------
and during the continuance of any Event of Default and
(ii) the making of the request or the granting of the
consent specified by Section 9.1 to authorize the
Administrative Agent to declare all amounts under this
Agreement due and payable pursuant to the provisions of
Section 9.1 or the automatic acceleration of such amounts
pursuant to the proviso to that Section, each Bank is hereby
authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time
owing by such Bank to or for the credit or the account of
the Borrower against any and all of the obligations of the
Borrower now or hereafter existing under this Agreement
irrespective of whether or not such Bank shall have made any
demand under this Agreement and although such obligations
may be unmatured. Each Bank agrees promptly to notify the
Borrower after any such set-off and application made by such
Bank; provided, however, that the failure to give such
-------- -------
notice shall not affect the validity of such set-off and
application. The rights of each Bank under this Sec-
tion 11.5 are in addition to any other rights and remedies
(including, without limitation, any other rights of set-off)
which such Bank may have.
11.6. Binding Effect. This Agreement shall
--------------
become effective when it shall have been executed by the
Borrower, each of the Managing Agents, each of the Facility
Agents and each of the Arrangers and when the Managing
Agents shall have been notified by each of the Banks that
such Bank has executed it and thereafter shall be binding
upon and inure to the benefit of the Borrower, each of the
Managing Agents, each of the Facility Agents, each of the
Arrangers and each of the Banks and their respective
successors and assigns, except that (i) the Borrower shall
have no right to assign its rights hereunder or any interest
herein without the prior written consent of the Banks and
(ii) no Bank may sell, transfer, assign, pledge or grant
participations in any of its Loans or any of its rights or
-59-
obligations hereunder except in accordance with Section 11.7
or as expressly required hereunder.
11.7. Assignments and Participations; Additional
------------------------------------------
Banks. (a) Any Bank may, at any time, by notice
-----
substantially in the form of Exhibit F hereto (each, a
"Notice of Assignment and Acceptance") delivered to the
Administrative Agent for its acceptance and recording,
together with a recording fee in the amount of $3,000,
assign all or any part of its rights and obligations and
delegate its duties under this Agreement (A) to any other
Bank or any affiliate of any Bank which actually controls,
is controlled by, or is under common control with such Bank
or to any Federal Reserve Bank (in either case without
limitation as to amount), or (B) with the prior consent of
the Borrower (such consent not to be unreasonably withheld),
to any other Person (but if in part, in a minimum amount of
$25,000,000 or, if less, the balance of such Bank's Commit-
ment; provided, however, that each assigning Bank must
-------- -------
assign an identical percentage of a Loan and its related
Commitment.
(b) Any Bank may at any time sell or grant
participations in its Commitment, or the obligations owing
to or from any Person existing under this Agreement;
provided, however, that (i) as between such Bank and the
-------- -------
Borrower, the existence of such participations shall not
give rise to any direct rights or obligations between the
Borrower and the participants; (ii) such Bank shall remain
solely responsible to the other parties hereto for the
performance of such obligations; (iii) the Borrower, the
Managing Agents, the Facility Agents and the other Banks
shall continue to deal solely and directly with such Bank in
connection with such Bank's rights and obligations under
this Agreement; and (iv) no such sale or grant of a
participation shall, without the consent of the Borrower,
require the Borrower to file a registration statement with
the Securities and Exchange Commission or apply to qualify
the Commitments or the Loans under the securities laws of
any state.
(c) If an assignment is made by any Bank in
accordance with the provisions of paragraph (a) above, upon
acceptance and recording by the Administrative Agent, and
approval by the Borrower, where applicable, of each Notice
of Assignment and Acceptance, (i) the assignee thereunder
shall become a party to this Agreement and the Borrower
shall release and discharge the assigning Bank from its
duties, liabilities or obligations under this Agreement to
the extent the same are so assigned and delegated by such
Bank, provided that no such consent, release or discharge
--------
-60-
shall have effect until the Borrower shall have received a
fully executed copy of the Notice of Assignment and
Acceptance relating to such assignment and (ii) Schedule II
shall be deemed amended to give effect to such assignment.
The Borrower agrees that each such disposition will give
rise to a direct obligation of the Borrower to any such
assignee.
(d) The Borrower authorizes each Bank to disclose
to any prospective assignee or participant and any assignee
or participant any and all financial information in such
Bank's possession concerning the Borrower and this
Agreement; provided, however, that, prior to any such
-------- -------
disclosure, the assignee or participant or proposed assignee
or participant shall agree to preserve the confidentiality
of any confidential information relating to the Borrower
received by it from such Bank in accordance with
Section 11.10.
(e) Any Bank which sells or grants participations
in any Loans or its Commitment may not grant to the
participants the right to vote other than on amendments,
consents, waivers, modifications or other actions which
change the principal amount of, postpone the scheduled
maturity of, or decrease the interest rates applicable to,
any Loans under, or increase the amount of, such Commitment
(except with respect to participating Affiliates actually
controlled by, controlling or under common control with,
such Bank); provided, however, that as between the Bank and
-------- -------
the Borrower, only the Bank shall be entitled to cast such
votes.
(f) No participant in any Bank's rights or
obligations shall be entitled to receive any greater payment
under Section 3.5 or 3.7 than such Bank would have been
entitled to receive with respect to the rights participated,
and no participation shall be sold or granted to any Person
as to which the events specified in Section 3.6 have
occurred on or before the date of participation.
(g) The Administrative Agent shall maintain at
its address referred to in Section 11.2 a copy of each
Notice of Assignment and Acceptance received by it and a
register, containing the terms of each Notice of Assignment
and Acceptance, for the recordation of the names and
addresses of each Bank and the Commitment of, and principal
amount of the Loans owing to, each Bank from time to time
(the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest
error, and the Borrower, the Banks, the Facility Agents and
the Managing Agents may treat each Person whose name is
-61-
recorded in the Register as a Bank hereunder for all pur-
poses of this Agreement. The Register shall be available
for inspection by the Borrower, any Bank, any Facility Agent
or any Managing Agent at any reasonable time and from time
to time upon reasonable prior notice.
11.8. GOVERNING LAW; SEVERABILITY. THIS
---------------------------
AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HERETO SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK. WHEREVER POSSIBLE,
EACH PROVISION OF THIS AGREEMENT SHALL BE INTERPRETED IN
SUCH MANNER AS TO BE EFFECTIVE AND VALID UNDER APPLICABLE
LAW, BUT IF ANY PROVISION OF THIS AGREEMENT SHALL BE
PROHIBITED BY OR INVALID UNDER APPLICABLE LAW, SUCH
PROVISION SHALL BE INEFFECTIVE TO THE EXTENT OF SUCH
PROHIBITION OR INVALIDITY, WITHOUT INVALIDATING THE
REMAINDER OF SUCH PROVISION OR THE REMAINING PROVISIONS OF
THIS AGREEMENT.
11.9. SUBMISSION TO JURISDICTION; WAIVER OF JURY
------------------------------------------
TRIAL.
-----
(a) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT
TO THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE
UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW
YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE
BORROWER HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION
OF THE AFORESAID COURTS. THE PARTIES HERETO HEREBY IRRE-
VOCABLY WAIVE ANY OBJECTION, INCLUDING, WITHOUT LIMITATION,
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS
OF FORUM NON CONVENIENS, WHICH ANY OF THEM MAY NOW OR
--------------------
HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR
PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS.
(b) The Borrower irrevocably consents to the
service of process of any of the aforementioned courts in
any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to
the Borrower at its address specified for notices in or
pursuant to Section 11.2 hereof, such service to become
effective 30 days after such mailing.
(c) Nothing contained in this Section 11.9 shall
affect the right of any Managing Agent, any Facility Agent
or any Bank to serve process in any other manner permitted
by law or commence legal proceedings or otherwise proceed
against the Borrower in any other jurisdiction.
-62-
(d) Each of the parties hereto waives any right
it may have to trial by jury in any proceeding arising out
of this Agreement.
11.10. Confidentiality. Each Bank, each Managing
---------------
Agent and each Facility Agent agrees to keep confidential
information obtained by it pursuant hereto (or otherwise
obtained from the Borrower in connection with this
Agreement) confidential in accordance with such Person's
customary practices and agrees that it will only use such
information in connection with the transactions contemplated
by this Agreement and not disclose any of such information
other than (i) to such Person's employees, counsel, repre-
sentatives and agents who are or are expected to be involved
in the evaluation of such information in connection with the
transactions contemplated by this Agreement and who in each
case agree to be bound by the provisions of this sentence,
(ii) to the extent that disclosure by such Person is
required, or to the extent that such Person has been advised
by counsel that disclosure is required, in order to comply
with any law, regulation or judicial order or requested or
required by bank regulators or auditors or other Govern-
mental Authority, (iii) to assignees or participants of the
Loans or Commitments or potential assignees or participants
of the Loans or Commitments who in each case agree in
writing to be bound by the provisions of this sentence or
(iv) to the extent that such information has otherwise been
disclosed or made public other than by such Person, or such
Person's employees, counsel, representatives or agents, in
violation of this Section 11.10.
11.11. Section Titles. The Section titles
--------------
contained in this Agreement are and shall be without
substantive meaning or content of any kind whatsoever and
are not a part of the agreement between the parties hereto.
11.12. Execution in Counterparts. This Agreement
-------------------------
may be executed in any number of counterparts and by differ-
ent parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all
of which taken together shall constitute one and the same
agreement.
-63-
IN WITNESS WHEREOF, the parties hereto have caused
this Credit Agreement to be duly executed as of the date
first above written.
VIACOM INC., as Borrower
By:
--------------------------------
Name:
Title:
-64-
Managing Agents
---------------
THE BANK OF NEW YORK, as Managing
Agent, the Documentation Agent and
a Bank
By:
--------------------------------
Name:
Title:
CITIBANK, N.A., as Managing Agent,
the Administrative Agent and a Bank
By:
--------------------------------
Name:
Title:
MORGAN GUARANTY TRUST COMPANY OF
NEW YORK, as Managing Agent and a
Bank
By:
--------------------------------
Name:
Title:
BANK OF AMERICA NT&SA, as Managing
Agent and a Bank
By:
--------------------------------
Name:
Title:
-65-
Syndication Agent
-----------------
JP MORGAN SECURITIES INC., as the
Syndication Agent
By:
--------------------------------
Name:
Title:
Agents
------
BANK OF MONTREAL, as Agent and a
Bank
By:
--------------------------------
Name:
Title:
THE BANK OF NOVA SCOTIA, as Agent
and a Bank
By:
--------------------------------
Name:
Title:
THE BANK OF TOKYO TRUST COMPANY, as
Agent and a Bank
By:
--------------------------------
Name:
Title:
-66-
BANQUE PARIBAS, as Agent and a Bank
By:
--------------------------------
Name:
Title:
BARCLAYS BANK PLC, as Agent and a
Bank
By:
--------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK (NATIONAL
ASSOCIATION), as Agent and a Bank
By:
--------------------------------
Name:
Title:
CHEMICAL BANK, as Agent and a Bank
By:
--------------------------------
Name:
Title:
CREDIT LYONNAIS CAYMAN ISLAND
BRANCH, as Agent and a Bank
By:
--------------------------------
Name:
Title:
-67-
THE DAI-ICHI KANGYO BANK LTD., NEW
YORK BRANCH, as Agent and a Bank
By:
--------------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as Agent and a Bank
By:
--------------------------------
Name:
Title:
THE FUJI BANK, LIMITED, as Agent
and a Bank
By:
--------------------------------
Name:
Title:
THE INDUSTRIAL BANK OF JAPAN, LTD.,
as Agent and a Bank
By:
--------------------------------
Name:
Title:
LTCB TRUST COMPANY, as Agent and a
Bank
By:
--------------------------------
Name:
Title:
-68-
MELLON BANK, N.A., as Agent and a
Bank
By:
--------------------------------
Name:
Title:
THE MITSUBISHI BANK, LIMITED, as
Agent and a Bank
By:
--------------------------------
Name:
Title:
THE MITSUBISHI TRUST & BANKING
CORPORATION, as Agent and a Bank
By:
--------------------------------
Name:
Title:
NATIONSBANK OF TEXAS, N.A., as
Agent and a Bank
By:
--------------------------------
Name:
Title:
THE NIPPON CREDIT BANK, LIMITED, as
Agent and a Bank
By:
--------------------------------
Name:
Title:
-69-
ROYAL BANK OF CANADA, as Agent and
a Bank
By:
--------------------------------
Name:
Title:
THE SAKURA BANK, LIMITED, as Agent
and a Bank
By:
----------------------------------
Name:
Title:
THE SANWA BANK, LTD., as Agent and a
Bank
By:
----------------------------------
Name:
Title:
SOCIETE GENERALE, as Agent and a Bank
By:
----------------------------------
Name:
Title:
THE SUMITOMO BANK, LIMITED, NEW YORK
BRANCH, as Agent and a Bank
By:
----------------------------------
Name:
Title:
-70-
THE TOKAI BANK, LIMITED, NEW YORK
BRANCH, as Agent and a Bank
By:
----------------------------------
Name:
Title:
THE TORONTO-DOMINION BANK, as Agent
and a Bank
By:
----------------------------------
Name:
Title:
UNION BANK, as Agent and a Bank
By:
----------------------------------
Name:
Title:
UNION BANK OF SWITZERLAND, as Agent
and a Bank
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
-71-
CREDIT SUISSE, as Agent and a Bank
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
DEUTSCHE BANK AG, through its New
York and/or Cayman Islands Branch, as
Agent and a Bank
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
WESTDEUTSCHE LANDESBANK, as Agent and
a Bank
By:
----------------------------------
Name:
Title:
-72-
PARAMOUNT GUARANTEE
GUARANTEE, dated as of September 29, 1994, made by
Paramount Communications, Inc., a Delaware corporation (the
"Guarantor"), in favor of the banks (the "Banks") parties,
from time to time, to the Credit Agreement (as defined
below), The Bank of New York, Citibank, N.A., Morgan
Guaranty Trust Company of New York, and Bank of America
NT&SA, as managing agents (the "Managing Agents") for the
Banks, the Bank of New York, as documentation agent (the
"Documentation Agent") for the Banks, Citibank, N.A., as
administrative agent (the "Administrative Agent") for the
Banks, JP Morgan Inc. as syndication agent (the "Syndication
Agent") for the Banks and the banks identified as agents on
the signature pages of the Credit Agreement, as agents (the
"Agents") for the Banks.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Documentation Agent, the
Administrative Agent, the Syndication Agent (collectively
the "Facility Agents"), the Managing Agents, the Agents and
the Banks have entered into a credit agreement dated as of
September 29, 1994 (said agreement, as it may hereafter be
amended, supplemented or otherwise modified from time to
time, being the "Credit Agreement", and the terms defined
therein and not otherwise defined herein being used herein
as therein defined) with Viacom Inc., a corporation
organized and existing under the laws of the State of
Delaware (the "Borrower"); and
WHEREAS, it is a condition precedent to the
Initial Funding Date under the Credit Agreement that the
Guarantor shall have executed and delivered this Guarantee;
NOW, THEREFORE, in consideration of the premises
and in order to induce the Banks to make the loans under the
Credit Agreement, the Guarantor hereby agrees as follows:
SECTION 1. Guarantee. The Guarantor hereby
---------
unconditionally and irrevocably guarantees the punctual
payment when due, whether at stated maturity, by accelera-
tion or otherwise, of all obligations of the Borrower now or
hereafter existing under the Credit Agreement, whether for
borrowed money, interest, fees or any other amounts due
thereunder or otherwise (the "Obligations") and any and all
expenses (including counsel fees and expenses) reasonably
incurred by any Bank, Facility Agent, Managing Agent or
Agent in enforcing any rights under this Guarantee.
SECTION 2. Guarantee Absolute. The Guarantor
------------------
guarantees that the Obligations will be paid strictly in
accordance with the terms of the Credit Agreement, regard-
less of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or
the rights of any Bank, Facility Agent, Managing Agent or
Agent with respect thereto. The liability of the Guarantor
under this Guarantee shall be absolute and unconditional
irrespective of:
(i) any lack of validity or enforceability
of the Credit Agreement or any other agreement or
instrument relating thereto;
(ii) any change in the time, manner or
place of payment of, or in any other term of, all
or any of the Obligations, or any other amendment
or waiver of or any consent to departure from the
Credit Agreement;
(iii) any exchange, release or non-
perfection of any collateral, or any release or
amendment or waiver of or consent to departure
from any other guaranty, for all or any of the
Obligations; or
(iv) any other circumstance which might
otherwise constitute a defense available to, or a
discharge of, the Borrower, or a guarantor.
SECTION 3. Waiver. The Guarantor hereby waives
------
all notices with respect to any of the Obligations and this
Guarantee and any requirement that any Bank, Facility Agent,
Managing Agent or Agent protect, secure, perfect or insure
any security interests or lien on any property subject
thereto or exhaust any right or take any action against the
Borrower, or any other person or entity or any collateral.
SECTION 4. Subrogation. (a) The Guarantor shall
-----------
not exercise any rights which it may have acquired by way of
subrogation under this Guarantee, by any payment made
hereunder or otherwise nor shall the Guarantor seek any
reimbursement from Borrower in respect of payments made by
the Guarantor hereunder, unless and until all of the
Obligations shall have been paid to the Banks and
discharged, in full, and if any payment shall be made to the
Guarantor on account of such subrogation or reimbursement
rights at any time when the Obligations shall not have been
paid and discharged, in full, each and every amount so paid
shall forthwith be paid to the Banks to be credited and
2
applied against the Obligations, whether matured or
unmatured.
(b) If, pursuant to applicable law, the
Guarantor, by payment or otherwise, becomes subrogated to
all or any of the rights of the Banks under any of the Loan
Documents, the rights of the Banks to which the Guarantor
shall be subrogated shall be accepted by the Guarantor "as
is" and without any representation or warranty of any kind
by the Banks, express or implied, with respect to the
legality, value, validity or enforceability of any of such
rights, or the existence, availability, value,
merchantability or fitness for any particular purpose of any
collateral and shall be without recourse to the Banks.
SECTION 5. Representations and Warranties. The
------------------------------
Guarantor hereby represents and warrants as follows:
(a) It is a corporation duly incorporated,
validly existing and in good standing under the laws of the
State of Delaware.
(b) The execution, delivery and performance by
the Guarantor of this Guarantee are within the Guarantor's
corporate powers, have been duly authorized by all necessary
corporate action, do not contravene the Guarantor's charter
or by-laws, any law or any contractual restriction binding
on or affecting and material to the Guarantor, and do not
result in or require the creation of any Lien upon or with
respect to any of its properties.
(c) No authorization or approval or other action
by, and no notice to or filing with, any governmental
authority or regulatory body is required for the due
execution, delivery and performance by the Guarantor of this
Guarantee.
(d) This Guarantee is a legal, valid and binding
obligation of the Guarantor, enforceable against the
Guarantor in accordance with its terms, except where such
enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or
limiting creditor's rights generally or equitable principles
relating to enforceability.
(e) There is no pending or threatened action or
proceeding affecting the Guarantor before any court,
governmental agency or arbitrator, in which, individually or
in the aggregate, there is a reasonable probability of an
adverse decision which could have a Material Adverse Effect
or result in a Material Credit Agreement Change.
3
SECTION 6. Addresses for Notices. All notices
---------------------
and other communications provided for hereunder shall be in
writing (including telegraphic or telecopy communication)
and mailed, telegraphed, telecopied or delivered, if to the
Guarantor, addressed to it at c/o Viacom Inc., 1515
Broadway, New York, New York 10036, Attention: Treasurer, if
to any Bank, Facility Agent, Managing Agent or Agent,
addressed to it at the address of such Bank, Facility Agent,
Managing Agent or Agent (as the case may be) specified in
the Credit Agreement, or as to each party at such other
address as shall be designated by such party in a written
notice to each other party complying as to delivery with the
terms of this Section. All such notices and other
communications shall, when mailed or telegraphed,
respectively, be effective when deposited in the mails or
delivered to the telegraph company, respectively, addressed
as aforesaid, and shall, when delivered or telecopied, be
effective when received.
SECTION 7. No Waiver; Remedies. No failure on
-------------------
the part of any Bank, Facility Agent, Managing Agent or
Agent to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder preclude
any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.
SECTION 8. Right of Set-off. Upon the occurrence
----------------
and during the continuance of any Event of Default (as
defined in the Credit Agreement) and, except in the case of
one of the events referred in clause (f) of Section 9.1 of
the Credit Agreement, the making of the request or the
granting of the consent specified by Section 9.1 of the
Credit Agreement to authorize the Administrative Agent to
declare all amounts under the Credit Agreement due and
payable pursuant to the provisions of said Section 9.1, each
Bank is hereby authorized at any time and from time to time,
to the fullest extent permitted by law, to set-off and apply
any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebted-
ness at any time owing by such Bank to or for the credit or
the account of the Guarantor against any and all of the
obligations of the Guarantor now or hereafter existing under
this Guarantee, irrespective of whether or not such Bank
shall have made any demand under this Guarantee and although
such obligations may be contingent and unmatured. Each Bank
agrees promptly to notify the Guarantor after any such set-
off and application made by such Bank; provided, however,
-------- -------
that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of
4
each Bank under this Section are in addition to other rights
and remedies (including, without limitation, other rights of
set-off) which such Bank may have.
SECTION 9. Continuing Guarantee; Transfer of
---------------------------------
Interest. This Guarantee is a continuing guaranty and shall
--------
(i) remain in full force and effect until indefeasible
payment in full of the Obligations and all other amounts
payable under this Guarantee, (ii) be binding upon the
Guarantor, its successors and assigns, and (iii) inure to
the benefit of and be enforceable by any Bank, Facility
Agent, Managing Agent or Agent, and their respective
successors, transferees, and assigns. Without limiting the
generality of the foregoing clause (iii), any Bank may
assign or otherwise transfer all or any part of its rights
and obligations under the Credit Agreement in accordance
therewith, and such other person or entity shall thereupon
become vested with all the rights in respect thereof granted
to such Bank herein or otherwise, subject, however, to the
provisions of Article XI of the Credit Agreement.
SECTION 10. Reinstatement. This Guarantee shall
-------------
remain in full force and effect and continue to be effective
should any petition be filed by or against any Loan Party
(as defined in the Credit Agreement) for liquidation or
reorganization, should any Loan Party become insolvent or
make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant
part of any Loan Party's assets, and shall, to the fullest
extent permitted by law, continue to be effective or be
reinstated, as the case may be, if at any time payment and
performance of this Obligations, or any part thereof, is,
pursuant to applicable law, rescinded or reduced in amount,
or must otherwise be restored or returned by any obligee of
the Obligations, whether as a "voidable preference",
"fraudulent conveyance", or otherwise, all as though such
payment or performance had not been made. In the event that
any payment, or any part thereof, is rescinded, reduced,
restored, or returned, the Obligations shall, to the fullest
extent permitted by law, be reinstated and deemed reduced
only by such amount paid and not so rescinded, reduced,
restored or returned.
SECTION 11. Limitation of Obligation. The
------------------------
liability of the Guarantor under this Guarantee shall not
exceed the greater of (i) 95% of the Adjusted Net Assets (as
defined below) of the Guarantor on the date of delivery
hereof and (ii) 95% of the Adjusted Net Assets (as defined
below) of the Guarantor on the date of any payment
hereunder; provided, that nothing in this Section 11 shall
--------
be construed to limit the liability of the Guarantor under
5
any other Loan Document to which it is a party. "Adjusted
--------
Net Assets" of any Guarantor at any date means the lesser of
----------
(x) the amount by which the fair value of the property of
such Guarantor (including, without limitation, rights of
subrogation, contribution, and similar rights) exceeds the
total amount of liabilities, including, without limitation,
contingent liabilities, but excluding liabilities under this
Guarantee, of the Guarantor at such date and (y) the amount
by which the present fair salable value of the assets of the
Guarantor (including, without limitation, rights of
subrogation, contribution, and similar rights) at such date
exceeds the amount that will be required to pay the probable
liability of the Guarantor on its debts, excluding debt in
respect of this Guarantee, as they become absolute and
matured.
SECTION 12. GOVERNING LAW. THIS GUARANTEE SHALL
-------------
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PROVISIONS
THEREOF RELATING TO CONFLICT OF LAWS.
SECTION 13. WAIVER OF JURY TRIAL. THE GUARANTOR
--------------------
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR
PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES
HEREUNDER, UNDER THE CREDIT AGREEMENT OR UNDER THE OTHER
LOAN DOCUMENTS RELATIVE TO EACH OF THE FOREGOING.
IN WITNESS WHEREOF, the Guarantor has caused this
Guarantee to be duly executed and delivered by its officer
thereunto duly authorized as of the date first above
written.
PARAMOUNT COMMUNICATIONS INC.
By:__________________________
Name:
Title:
6
VII GUARANTEE
GUARANTEE, dated as of September 29, 1994, made by
Viacom International Inc., a Delaware corporation (the
"Guarantor"), in favor of the banks (the "Banks") parties to
the Credit Agreement (as defined below), The Bank of New
York, Citibank, N.A., Morgan Guaranty Trust Company of New
York, and Bank of America NT&SA, as managing agents (the
"Managing Agents") for the Banks, the Bank of New York, as
documentation agent (the "Documentation Agent") for the
Banks, Citibank, N.A., as administrative agent (the
"Administrative Agent") for the Banks, JP Morgan Inc. as
syndication agent (the "Syndication Agent") for the Banks
and the banks identified as agents on the signature pages of
the Credit Agreement, as agents (the "Agents") for the
Banks.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Documentation Agent, the
Administrative Agent, the Syndication Agent (collectively
the "Facility Agents"), the Managing Agents, the Agents and
the Banks have entered into a credit agreement dated as of
September 29, 1994 (said agreement, as it may hereafter be
amended, supplemented or otherwise modified from time to
time, being the "Credit Agreement", and the terms defined
therein and not otherwise defined herein being used herein
as therein defined) with Viacom Inc., a corporation
organized and existing under the laws of the State of
Delaware (the "Borrower"); and
WHEREAS, it is a condition precedent to the
Initial Funding Date under the Credit Agreement that the
Guarantor shall have executed and delivered this Guarantee;
NOW, THEREFORE, in consideration of the premises
and in order to induce the Banks to make the Loans under the
Credit Agreement, the Guarantor hereby agrees as follows:
SECTION 1. Guarantee. The Guarantor hereby
---------
unconditionally and irrevocably guarantees the punctual
payment when due, whether at stated maturity, by
acceleration or otherwise, of all obligations of the
Borrower now or hereafter existing under the Credit
Agreement, whether for borrowed money, interest, fees or any
other amounts due thereunder or otherwise (the
"Obligations") and any and all expenses (including counsel
fees and expenses) reasonably incurred by any Bank, Facility
Agent, Managing Agent or Agent in enforcing any rights under
this Guarantee.
SECTION 2. Guarantee Absolute. The Guarantor
------------------
guarantees that the Obligations will be paid strictly in
accordance with the terms of the Credit Agreement, regard-
less of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or
the rights of any Bank, Facility Agent, Managing Agent or
Agent with respect thereto. The liability of the Guarantor
under this Guarantee shall be absolute and unconditional
irrespective of:
(i) any lack of validity or enforceability
of the Credit Agreement or any other agreement or
instrument relating thereto;
(ii) any change in the time, manner or
place of payment of, or in any other term of, all
or any of the Obligations, or any other amendment
or waiver of or any consent to departure from the
Credit Agreement;
(iii) any exchange, release or non-
perfection of any collateral, or any release or
amendment or waiver of or consent to departure
from any other guaranty, for all or any of the
Obligations; or
(iv) any other circumstance which might
otherwise constitute a defense available to, or a
discharge of, the Borrower, or a guarantor.
SECTION 3. Waiver. The Guarantor hereby waives
------
all notices with respect to any of the Obligations and this
Guarantee and any requirement that any Bank, Facility Agent,
Managing Agent or Agent protect, secure, perfect or insure
any security interests or lien on any property subject
thereto or exhaust any right or take any action against the
Borrower, or any other person or entity or any collateral.
SECTION 4. Subrogation. (a) The Guarantor shall
-----------
not exercise any rights which it may have acquired by way of
subrogation under this Guarantee, by any payment made
hereunder or otherwise nor shall the Guarantor seek any
reimbursement from Borrower in respect of payments made by
the Guarantor hereunder, unless and until all of the
Obligations shall have been paid to the Banks and
discharged, in full, and if any payment shall be made to the
Guarantor on account of such subrogation or reimbursement
rights at any time when the Obligations shall not have been
paid and discharged, in full, each and every amount so paid
shall forthwith be paid to the Banks to be credited and
2
applied against the Obligations, whether matured or
unmatured.
(b) If, pursuant to applicable law, the
Guarantor, by payment or otherwise, becomes subrogated to
all or any of the rights of the Banks under any of the Loan
Documents, the rights of the Banks to which the Guarantor
shall be subrogated shall be accepted by the Guarantor "as
is" and without any representation or warranty of any kind
by the Banks, express or implied, with respect to the
legality, value, validity or enforceability of any of such
rights, or the existence, availability, value, merchantabil-
ity or fitness for any particular purpose of any collateral
and shall be without recourse to the Banks.
SECTION 5. Representations and Warranties. The
------------------------------
Guarantor hereby represents and warrants as follows:
(a) It is a corporation duly incorporated,
validly existing and in good standing under the laws of the
State of Delaware.
(b) The execution, delivery and performance by
the Guarantor of this Guarantee are within the Guarantor's
corporate powers, have been duly authorized by all necessary
corporate action, do not contravene the Guarantor's charter
or by-laws, any law or any contractual restriction binding
on or affecting and material to the Guarantor, and do not
result in or require the creation of any Lien upon or with
respect to any of its properties.
(c) No authorization or approval or other action
by, and no notice to or filing with, any governmental
authority or regulatory body is required for the due
execution, delivery and performance by the Guarantor of this
Guarantee.
(d) This Guarantee is a legal, valid and binding
obligation of the Guarantor, enforceable against the
Guarantor in accordance with its terms, except where such
enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or
limiting creditor's rights generally or equitable principles
relating to enforceability.
(e) There is no pending or threatened action or
proceeding affecting the Guarantor before any court,
governmental agency or arbitrator, in which, individually or
in the aggregate, there is a reasonable probability of an
adverse decision which could have a Material Adverse Effect
or result in a Material Credit Agreement Change.
3
SECTION 6. Addresses for Notices. All notices
---------------------
and other communications provided for hereunder shall be in
writing (including telegraphic or telecopy communication)
and mailed, telegraphed, telecopied or delivered, if to the
Guarantor, addressed to it at c/o Viacom Inc., 1515
Broadway, New York, New York 10036, Attention: Treasurer,
if to any Bank, Facility Agent, Managing Agent or Agent,
addressed to it at the address of such Bank, Facility Agent,
Managing Agent or Co-Agent (as the case may be) specified in
the Credit Agreement, or as to each party at such other
address as shall be designated by such party in a written
notice to each other party complying as to delivery with the
terms of this Section. All such notices and other
communications shall, when mailed or telegraphed,
respectively, be effective when deposited in the mails or
delivered to the telegraph company, respectively, addressed
as aforesaid, and shall, when delivered or telecopied, be
effective when received.
SECTION 7. No Waiver; Remedies. No failure on
-------------------
the part of any Bank, Facility Agent, Managing Agent or
Agent to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder preclude
any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.
SECTION 8. Right of Set-off. Upon the occurrence
----------------
and during the continuance of any Event of Default (as
defined in the Credit Agreement) and, except in the case of
one of the events referred in clause (f) of Section 9.1 of
the Credit Agreement, the making of the request or the
granting of the consent specified by Section 9.1 of the
Credit Agreement to authorize the Administrative Agent to
declare all amounts under the Credit Agreement due and
payable pursuant to the provisions of said Section 9.1, each
Bank is hereby authorized at any time and from time to time,
to the fullest extent permitted by law, to set-off and apply
any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebted-
ness at any time owing by such Bank to or for the credit or
the account of the Guarantor against any and all of the
obligations of the Guarantor now or hereafter existing under
this Guarantee, irrespective of whether or not such Bank
shall have made any demand under this Guarantee and although
such obligations may be contingent and unmatured. Each Bank
agrees promptly to notify the Guarantor after any such set-
off and application made by such Bank; provided, however,
-------- -------
that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of
4
each Bank under this Section are in addition to other rights
and remedies (including, without limitation, other rights of
set-off) which such Bank may have.
SECTION 9. Continuing Guarantee; Transfer of
---------------------------------
Interest. This Guarantee is a continuing guaranty and shall
--------
(i) remain in full force and effect until indefeasible
payment in full of the Obligations and all other amounts
payable under this Guarantee, (ii) be binding upon the
Guarantor, its successors and assigns, and (iii) inure to
the benefit of and be enforceable by any Bank, Facility
Agent, Managing Agent or Agent, and their respective
successors, transferees, and assigns. Without limiting the
generality of the foregoing clause (iii), any Bank may
assign or otherwise transfer all or any part of its rights
and obligations under the Credit Agreement in accordance
therewith, and such other person or entity shall thereupon
become vested with all the rights in respect thereof granted
to such Bank herein or otherwise, subject, however, to the
provisions of Article XI of the Credit Agreement.
SECTION 10. Reinstatement. This Guarantee shall
-------------
remain in full force and effect and continue to be effective
should any petition be filed by or against any Loan Party
(as defined in the Credit Agreement) for liquidation or
reorganization, should any Loan Party become insolvent or
make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant
part of any Loan Party's assets, and shall, to the fullest
extent permitted by law, continue to be effective or be
reinstated, as the case may be, if at any time payment and
performance of this Obligations, or any part thereof, is,
pursuant to applicable law, rescinded or reduced in amount,
or must otherwise be restored or returned by any obligee of
the Obligations, whether as a "voidable preference",
"fraudulent conveyance", or otherwise, all as though such
payment or performance had not been made. In the event that
any payment, or any part thereof, is rescinded, reduced,
restored, or returned, the Obligations shall, to the fullest
extent permitted by law, be reinstated and deemed reduced
only by such amount paid and not so rescinded, reduced,
restored or returned.
SECTION 11. Limitation of Obligation. The
------------------------
liability of the Guarantor under this Guarantee shall not
exceed the greater of (i) 95% of the Adjusted Net Assets (as
defined below) of the Guarantor on the date of delivery
hereof and (ii) 95% of the Adjusted Net Assets (as defined
below) of the Guarantor on the date of any payment
hereunder; provided, that nothing in this Section 11 shall
--------
be construed to limit the liability of the Guarantor under
5
any other Loan Document to which it is a party. "Adjusted
--------
Net Assets" of any Guarantor at any date means the lesser of
----------
(x) the amount by which the fair value of the property of
such Guarantor (including, without limitation, rights of
subrogation, contribution, and similar rights) exceeds the
total amount of liabilities, including, without limitation,
contingent liabilities, but excluding liabilities under this
Guarantee, of the Guarantor at such date and (y) the amount
by which the present fair salable value of the assets of the
Guarantor (including, without limitation, rights of
subrogation, contribution, and similar rights) at such date
exceeds the amount that will be required to pay the probable
liability of the Guarantor on its debts, excluding debt in
respect of this Guarantee, as they become absolute and
matured.
SECTION 12. GOVERNING LAW. THIS GUARANTEE SHALL
-------------
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PROVISIONS
THEREOF RELATING TO CONFLICT OF LAWS.
SECTION 13. WAIVER OF JURY TRIAL. THE GUARANTOR
--------------------
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEED-
ING TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES HEREUNDER,
UNDER THE CREDIT AGREEMENT OR UNDER THE OTHER LOAN DOCUMENTS
RELATIVE TO EACH OF THE FOREGOING.
IN WITNESS WHEREOF, the Guarantor has caused this
Guarantee to be duly executed and delivered by its officer
thereunto duly authorized as of the date first above
written.
VIACOM INTERNATIONAL INC.
By:__________________________
Name:
Title:
6