EXHIBIT 10.1



 






AMENDMENT NO. 5 AND CONSENT NO. 4

TO REVOLVING CREDIT AGREEMENT




     AMENDMENT NO. 5 AND CONSENT NO. 4 (this “Amendment”), dated as of August 9, 2005, to
the REVOLVING CREDIT AGREEMENT, dated as of August 20, 2003, by and among HAIGHTS CROSS OPERATING
COMPANY (the “Borrower”), the several lenders from time to time parties thereto (the
“Lenders”), BEAR STEARNS CORPORATE LENDING, INC., as Syndication Agent (in such capacity,
the “Syndication Agent”), and THE BANK OF NEW YORK (“BNY”), as administrative agent
for the Lenders (in such capacity, the “Administrative Agent”) as amended by Amendment No.
1 and Waiver No. 1, dated as of January 26, 2004, Amendment No. 2 and Waiver No. 2, dated as of
April 14, 2004, Amendment No. 3 and Consent No. 3, dated as of December 1, 2004 and Amendment No. 4
and Waiver No. 3 to Revolving Credit Agreement, dated as of March 31, 2005 (and, as further amended
from time to time, the “Credit Agreement”).



RECITALS




     I. Unless defined herein, all capitalized terms used herein shall have the meanings
ascribed to them in the Credit Agreement.



     II. The Borrower has advised the Administrative Agent and the Lenders that its wholly owned
Subsidiary, Chelsea House Publishers, LLC (“Chelsea House”), intends to sell substantially
all of its assets (“Chelsea House Assets”) to Facts on File, Inc. (“Facts on File”)
for a purchase price of approximately $9,000,000, subject to adjustments for working capital and
other items as provided in, and otherwise on the terms and conditions of, an Asset Purchase
Agreement, to be dated on or about August 5, 2005, between Chelsea House and Facts on File (the
“Chelsea House Sale Agreement” and such sale, the “Chelsea House Asset Sale” ).



     III. The Borrower has requested that the Required Lenders (a) amend the Credit Agreement to
consent to the Chelsea House Asset Sale, (b) amend Section 7.2 of the Credit Agreement to permit
the Borrower to guarantee the obligations of Chelsea House under the Chelsea House Sale Agreement,
(c) agree to authorize the Administrative Agent, as Priority Debt Representative, to direct the
Collateral Trustee to release the Liens encumbering the Chelsea House Assets upon the closing of
the Chelsea House Asset Sale and (d) to amend Section 7.1(b) of the Credit Agreement for the fiscal
quarters ending June 30, 2005 and September 30, 2005.



     IV. The Administrative Agent and the Required Lenders have agreed to the Borrower’s requests
on the terms and subject to the conditions set forth in this Amendment.



 









 





          Accordingly, in consideration of the covenants, conditions and agreements hereinafter set
forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:




     1. Amendments.



          (a) Section 1 of the Credit Agreement is hereby amended by adding, in appropriate alphabetical
order, the following defined terms:





     “Amendment No. 5” shall mean Amendment No. 5 and Consent No. 4 to
Revolving Credit Agreement, dated as of August 5, 2005, among the Borrower, the
Required Lenders, the Administrative Agent and the Syndication Agent.




     “Amendment No. 5 Effective Date” shall mean August 9, 2005, provided
that the conditions set forth in Section 2 of Amendment No. 5 are satisfied on or
before August 10, 2005.




     “Chelsea House” shall have the meaning assigned to such term in the
Recitals of Amendment No. 5.




     “Chelsea House Asset Sale” shall have the meaning assigned to such
term in the Recitals of Amendment No. 5.




     “Chelsea House Assets” shall have the meaning assigned to such term in
the Recitals of Amendment No. 5.




     “Chelsea House Sale Agreement” shall have the meaning assigned to such
term in the Recitals of Amendment No. 5.



          (b) Section 7.1(b) of the Credit Agreement is hereby amended by deleting, for the fiscal
quarters ending June 30, 2005 and September 30, 2005, the ratio “1.75:1.00” in the chart in such
Section and by substituting therefor the ratio “1.50:1.00.”




          (c) Section 7.2 of the Credit Agreement is hereby amended by deleting the “and” at the end of
clause (h), deleting the “.” at the end of clause (i) and substituting therefor “; and”, and by
adding the following clause (j):





     “(j) Guarantee Obligations of the Borrower of the obligations of Chelsea House
under the Chelsea House Sale Agreement.”



          (d) Section 7.5 of the Credit Agreement is hereby amended by deleting the “and” at the end of
clause (e), deleting the “.” at the end of clause (f) and substituting therefor “; and” and adding
the following clause (g):




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     “(g) the Chelsea House Asset Sale pursuant to the Chelsea House Sale Agreement
provided that the proceeds thereof are used by Chelsea House for general limited liability
company purposes or are distributed by Chelsea House to the Borrower to use for general
corporate purposes.”



     2. Conditions
to Effectiveness.



          This Amendment shall be effective as of August 9, 2005, provided that the following
conditions are satisfied on or before August 10, 2005:




          (a) the Administrative Agent shall have received this Amendment executed by a duly authorized
signatory of the Borrower and each of the Guarantors and by each of the Required Lenders;




          (b) the Administrative Agent shall have (i) received a copy of the executed Chelsea House Sale
Agreement certified to be true and complete by an Authorized Officer of the Borrower and (ii)
confirmed such that the executed Chelsea House Sale Agreement is substantially in the form of the
draft thereof, dated July 26, 2005, without, in the reasonable judgment of the Administrative
Agent, material changes from such draft; and




          (c) the Administrative Agent shall have received such other documents as the Administrative Agent
may reasonably request.




     3. Miscellaneous



          (a) The Borrower hereby:





     (i) acknowledges and reaffirms its obligations under, and confirms the validity and
enforceability of, the Credit Agreement and the other Loan Documents;




     (ii) represents and warrants that, after giving effect to this Amendment, there exists no
Default or Event of Default and no Default or Event of Default will result from the
consummation of the transactions described in this Amendment; and




     (iii) represents and warrants that the representations and warranties contained in the
Credit Agreement (other than the representations and warranties made as of a specific date)
are true and correct in all material respects on and as of the date hereof.



          (b) Each of the Guarantors, by signing this Amendment, hereby:




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     (i) acknowledges and consents to the execution of this Amendment; and




     (ii) acknowledges and reaffirms its obligations under, and confirms the validity and
enforceability of, the Guarantee and Collateral Agreement and the other Loan Documents to
which it is a party.



          (c) This Amendment may be executed in any number of counterparts and by facsimile, each of which
shall be an original and all of which shall constitute one agreement. It shall not be necessary in
making proof of this Amendment to produce or account for more than one counterpart signed by the
party to be charged.




          (d) This Amendment is being delivered in and is intended to be performed in the State of New York
and shall be construed and enforceable in accordance with, and be governed by, the internal laws of
the State of New York without regard to principles of conflict of laws.




          (e) The Required Lenders hereby authorize the Administrative Agent, as Priority Debt
Representative, upon the satisfaction of the conditions set forth in Section 2, to direct the
Collateral Trustee to release the Chelsea House Assets in accordance with Article IV of the
Collateral Trust Agreement upon the closing of the Chelsea House Asset Sale.




          (f) The Borrower agrees to pay the reasonable fees and expenses of the Administrative Agent’s
counsel in connection with this Amendment and any other fees due to the Administrative Agent.




[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]




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HAIGHTS CROSS AMENDMENT NO. 5




     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and
delivered by their proper and duly authorized officers as of the day and year first above written.



	 	 	 	 	 	 	 	 	 
	 	 	BORROWER:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	HAIGHTS CROSS OPERATING COMPANY	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Executive Vice President
and Chief Financial Officer	 	 






 









 






HAIGHTS CROSS AMENDMENT NO. 5




	 	 	 	 	 	 	 	 	 
	 	 	GUARANTORS:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	HAIGHTS CROSS COMMUNICATIONS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Executive Vice President
and Chief Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SUNDANCE/NEWBRIDGE EDUCATIONAL PUBLISHING,
LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	TRIUMPH LEARNING, LLC	 	 
	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	RECORDED BOOKS, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	OAKSTONE PUBLISHING, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 






 









 






HAIGHTS CROSS AMENDMENT NO. 5




	 	 	 	 	 	 	 	 	 
	 	 	CHELSEA HOUSE PUBLISHERS, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	THE CORIOLIS GROUP, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	W F HOWES LIMITED	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	OPTIONS PUBLISHING, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Paul J. Crecca	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 







 










 






HAIGHTS CROSS AMENDMENT NO. 5




	 	 	 	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK,
	 	 	as a Lender and as Administrative Agent
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

Vice President
	 	 






 









 





HAIGHTS CROSS AMENDMENT NO. 5




	 	 	 	 	 	 	 	 	 
	 	 	BEAR STEARNS CORPORATE LENDING,
	 	 	INC., as a Lender and as Syndication Agent
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 






 









 





HAIGHTS CROSS AMENDMENT NO. 5




	 	 	 	 	 	 	 	 	 
	 	 	CIT LENDING SERVICES CORPORATION,
	 	 	as a Lender
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 






 









 





HAIGHTS CROSS AMENDMENT NO. 5




	 	 	 	 	 	 	 	 	 
	 	 	VAN KAMPEN SENIOR LOAN FUND
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title: