Document:

Exhibit 10.20

 

PROMISSORY
NOTE

 

	
  $306,108.00

  	
   

  	
  April 7, 2005

  

 

FOR VALUE RECEIVED, the undersigned, ICOP Digital,
Inc., a Colorado corporation, of 11011 King Street, Suite 260, Overland Park,
KS 66210 promises to pay to the order of Roger L. Mason at 14950 S. St. Andrews
Ave., Olathe, KS 66061 or such other place as the holder may designate in
writing to the undersigned, the principal sum of Three Hundred Six Thousand One
Hundred Eight and no/100 Dollars ($306,108.00), together with interest thereon
from date hereof until paid, at the rate of seven and three fourths Percent (7.750%)
per annum. The interest rate shall be adjusted on a daily basis to 2% above
Prime Rate, using the base rate on corporate loans by at least 75% of the
nation’s thirty largest banks known as the Wall Street Journal Prime Rate  The entire principal amount shall be due and
payable on October 7, 2005.

 

Payments shall be applied first to accrued interest
and the balance to principal. Accrued interest shall be paid monthly beginning
May 7, 2005 and each month thereafter until the entire principal balance is
paid in full.

 

All or any part of the aforesaid principal sum may be
prepaid at any time and from time to time without penalty.

 

In the event of any default by the undersigned in the
payment of principal or interest when due or in the event of the suspension of
actual business, insolvency, assignment for the benefit of creditors,
adjudication of bankruptcy, or appointment of a receiver, of or against the
undersigned, the unpaid balance of the principal sum of this promissory note
shall at the option of the holder become immediately due and payable.

 

The maker and all other persons who may become liable
for the payment hereof severally waive demand, presentment, protest, notice of
dishonor or nonpayment, notice of protest, and any and all lack of diligence or
delays in collection which may occur, and expressly consent and agree to each
and any extension or postponement of time of payment hereof from time to time
at or after maturity or other indulgence, and waive all notice thereof.

 

In case suit or action is instituted to collect this
note, or any portion hereof, the maker promises to pay such additional sum, as
the court may adjudge reasonable, attorneys’ fees in said proceedings.

 

This note is made and executed under, and is in all
respects governed by, the laws of the State of Kansas.

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ICOP
  Digital, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David C. Owen

  
	
   

  	
   

  	
  David C. Owen,
  President/CEOExhibit 10.4

 

AMENDMENT
NO. 3 TO CREDIT AGREEMENT

 

AMENDMENT dated as of April [    ],
2005 to the Amended and Restated Credit Agreement dated as of April 8, 2004 (as
amended from time to time, the “Credit
Agreement”) among WMG ACQUISITION CORP. (the “Company”), the Overseas Borrowers party
thereto, WMG HOLDINGS CORP. (“Holdings”), the
LENDERS party thereto (the “Lenders”),
BANC OF AMERICA SECURITIES LLC and DEUTSCHE BANK SECURITIES INC., as Joint Lead
Arrangers and Joint Book Managers, LEHMAN BROTHERS INC. and MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED, as Co-Arrangers and Joint Book
Managers, DEUTSCHE BANK SECURITIES INC. and LEHMAN COMMERCIAL PAPER INC., as
Co-Syndication Agents, MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
as Documentation Agent, and BANK OF AMERICA, N.A., as Administrative Agent (the
“Administrative Agent”), Swing Line
Lender and L/C Issuer.

 

PRELIMINARY STATEMENTS

 

(1)           WHEREAS,
the Company desires to refinance and replace all Term Loans outstanding under
the Credit Agreement immediately prior to giving effect to this Amendment (the “Existing Term Loans”) with a new class of term loans under
the Credit Agreement (the “Replacement Term Loans”),
in an amount equal to the aggregate principal amount of the Existing Term Loans
plus $250,000,000.  The Replacement Term
Loans shall have terms identical with, and have the same rights and obligations
under the Loan Documents as, the Existing Term Loans, except as such terms are
amended hereby.

 

(2)           WHEREAS,
each Term Lender who has an Existing Term Loan and who executes and delivers
this Amendment (each, a “Consenting Term Lender”)
shall be deemed, on the Third Amendment Effective Date (as defined in Section
14 of this Amendment), to have exchanged its Existing Term Loans for Replacement
Term Loans under the Credit Agreement in the same aggregate principal amount as
such Consenting Term Lender’s Existing Term Loans.

 

(3)           WHEREAS,
each Person who executes and delivers this Amendment as a term lender, other
than pursuant to an exchange of outstanding Term Loans described in paragraph
(2) above (the “Additional Term Lenders”), will
make the remaining Replacement Term Loans on the Third Amendment Effective Date
to the Company (the “Additional Term Loans”).
 The proceeds of the Additional Term
Loans will be used by the Company to, among other things, refinance in full the
outstanding principal amount of the Existing Term Loans of Existing Term
Lenders, if any, who do not execute and deliver this Amendment 

 

 

(the “Non-Consenting Term Lenders”).  It is understood and agreed that an
Additional Term Lender may be a Person that is an Existing Term Lender.

 

(4)           WHEREAS,
the Company has requested that the Lenders amend the Credit Agreement to effect
the changes described above, and certain other changes described herein, and the
Lenders have agreed, subject to the terms and conditions hereinafter set forth,
to amend the Credit Agreement to effect such changes as set forth below.

 

NOW, THEREFORE, in consideration of the mutual
covenants and agreements herein contained and for other good and valuable
consideration, the sufficiency and receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:

 

SECTION 1. 
Defined Terms; References.  Unless otherwise specifically
defined herein, each term used herein that is defined in the Credit Agreement
has the meaning assigned to such term in the Credit Agreement.  Each reference to “hereof”, “hereunder”, “herein”
and “hereby” and each other similar reference and each reference to “this Agreement”
and each other similar reference contained in the Credit Agreement, and each
reference in any other Loan Document to “the Credit Agreement” or “thereunder”,
“thereof” or other similar reference to the Credit Agreement, shall, after the Third
Amendment Effective Date (as defined in Section 14 of this Amendment), refer to
the Credit Agreement as amended hereby.

 

SECTION 2.  Amendments to Definitions.

 

(a)   Section 1.01 of the Credit Agreement is amended by adding the
following definitions in appropriate alphabetical order:

 

““Approved Bank” has the meaning specified in clause (b) of
the definition of “Cash Equivalents”

 

“Canadian LC Obligations” means Indebtedness permitted by
Section 7.03(b)(xxiv).

 

“Debt Rating” means, as of any date of determination, the
senior secured debt rating for the Company, as determined
by either S&P or Moody’s.

 

“Third Amendment” means the Third Amendment to this
Agreement, dated as of April [   ], 2005, among Holdings, the
Company, the Administrative Agent and the Lenders party thereto.

 

“Third Amendment Effective Date” has the meaning specified in
Section 14 of the Third Amendment.”

 

2

 

(b)   Section 1.01 of the Credit Agreement is further amended as
follows:

 

(i)       By
amending the following definitions to read in their entirety as follows:

 

““Cash Equivalents” means any of the following types of
Investments, to the extent owned by the Company or any of its Restricted
Subsidiaries free and clear of all Liens:

 

(a)           readily
marketable obligations issued or directly and fully guaranteed or insured by
the United States or any agency or instrumentality thereof having maturities of
not more than three hundred and sixty five (365) days from the date of
acquisition thereof;

 

(b)           time
deposits with, or insured certificates of deposit or bankers’ acceptances of,
any commercial bank that (i) (A) is a Lender or (B) is organized under the laws
of the United States, any state thereof or the District of Columbia or is the
principal banking subsidiary of a bank holding company organized under the laws
of the United States, any state thereof or the District of Columbia, and is a
member of the Federal Reserve System, (ii) issues (or the parent of which
issues) commercial paper rated at least P 1 (or the then equivalent grade) by
Moody’s or at least “A 1” (or the then equivalent grade) by S&P, and (iii)
has combined capital and surplus of at least $500,000,000 (any such bank being
an “Approved Bank”), in each case with
maturities of not more than three hundred and sixty five (365) days from the
date of acquisition thereof;

 

(c)           commercial
paper issued by an Approved Bank (or by the parent company thereof) or any note
issued by, or guaranteed by a corporation rated A 1 or A, as applicable (or the
equivalent thereof) or better by S&P or P 1 or A2, as applicable (or the
equivalent thereof) or better by Moody’s, in each case with maturities of not
more than three hundred and sixty five (365) days from the date of acquisition
thereof;

 

(d)           repurchase
agreements entered into by any Person with a bank or trust company (including
any of the Lenders) or recognized securities dealer having capital and surplus
in excess of $500,000,000 for direct obligations issued by or fully guaranteed
by the United States in which such Person shall have a perfected first priority
security interest (subject to no other Liens) and 

 

3

 

having, on the date of
purchase thereof, a fair market value of at least 100% of the amount of the repurchase
obligations;

 

(e)           Investments,
classified in accordance with GAAP as Current Assets of the Company or any of
its Restricted Subsidiaries, in money market investment programs which are
administered by financial institutions having capital of at least $500,000,000,
and the portfolios of which are limited such that 95% of such investments are
of the character, quality and maturity described in clauses (a), (b), (c) and
(d) of this definition;

 

(f)            solely
with respect to any Foreign Subsidiary, (i) certificates of deposit of,
bankers acceptances of, or time deposits with, any commercial bank which is
organized and existing under the laws of the country in which such Foreign
Subsidiary maintains its chief executive office and principal place of business
provided such country is a member of the Organization for Economic Cooperation
and Development (any such bank being a “Qualifying Bank”),
and whose senior unsecured long-term debt is rated at least A by S&P or A2
by Moody’s or is assigned an equivalent rating in such country (any such bank
being an “Approved Foreign Bank”) and maturing
within twelve (12) months of the date of acquisition, (ii) equivalents of
demand deposit accounts which are maintained with an Approved Foreign Bank,
(iii) certificates of deposit of, bankers acceptances of, time deposits with,
or equivalents of demand deposit accounts maintained with, any Qualifying Bank
that is not an Approved Bank, to the extent that the aggregate amount thereof
for all Foreign Subsidiaries does not exceed $20,000,000, and (iv) any offshore
funds offered by any Approved Foreign Bank or any of its Affiliates so long as
such offshore fund’s senior unsecured long term debt is rated AAA by S&P or
Aaa by Moody’s or is assigned an equivalent rating in the applicable
jurisdiction; and

 

(g)           auction
rate securities having a credit rating of AAA from S&P or Aaa from Moody’s
and having a reset date of not more than 365 days from the date of acquisition
thereof.

 

“Term Commitment” means, as to each Term Lender, its obligation
to make a Term Loan to the Company pursuant to Section 2.01(a) in an aggregate
amount not to exceed the amount set forth opposite such Lender’s name on
Schedule 2.01 under the caption “Term Commitment.”

 

4

 

(ii)   By
deleting the definitions of “Approved Domestic Bank” and “Specified Equity
Issuance”.

 

(iii)  By
amending paragraph (a) of the definition of “Applicable Rate” to read in its
entirety as follows:

 

“(a)           with respect to Term Loans, the following percentages per
annum based upon the Company’s Debt Rating:

 

	
  Applicable Rate

  	
   

  
	
  Pricing Level

  	
   

  	
  Eurodollar 

  Rate

  	
   

  	
  Base Rate

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  1.75

  	
  %

  	
  0.75

  	
  %

  
	
  2

  	
   

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  

 

Pricing
Level 1 shall apply if the Debt Rating assigned by S&P is at least BB- and the Debt Rating assigned by Moody’s is at least Ba3.

 

Pricing
Level 2 shall apply if Level 1 does not apply.

 

Upon the Third Amendment Effective Date, the Applicable Rate with
respect to Term Loans shall be determined based upon the Debt Rating specified
in the certificate delivered pursuant to Section 14(j) of the Third
Amendment.  Thereafter, each change in
the Applicable Rate resulting from a publicly announced change in the Debt
Rating shall be effective, in the case of an upgrade, on the date of delivery
by a Responsible Officer of the Company to the Administrative Agent of notice
thereof and, in the case of a downgrade, on the date of the public announcement
thereof.”

 

(iv)  By
adding immediately after “the Company” in the definition of “Qualifying IPO”
the following new paranthetical:

 

“(or,
for the purposes of the definition of “Change of Control”, Warner Music Group
Corp.)”

 

(v)   By
deleting the words “any fiscal year period of” in the first sentence of the
definition of “Excess Cash Flow”, replacing “and” at the end of clause
(b)(xxii) thereof with “plus (or minus)” and deleting clause (b)(xxiii) thereof.

 

(vi)  By
re-lettering clauses “(x)”, “(y)” and “(z)” of the definition of “Obligations”
as clauses “(w)”, “(x)” and “(y)” respectively, 

 

5

 

replacing
“and” immediately prior to new clause (y) with a comma, and adding at the end
of new clause (y) the following new clause (z):

 

“and
(z) the Canadian LC Obligations”

 

SECTION 3.  Replacement of Term Loans.

 

(a)        Subject to the terms and conditions hereof, each Consenting
Term Lender severally agrees to exchange its Existing Term Loans for a like
principal amount in Dollars of Replacement Term Loans on the Third Amendment
Effective Date, and from and after the Third Amendment Effective Date such
Existing Term Loans shall be deemed refinanced in full and such Replacement
Term Loans shall be deemed to be “Term Loans” made under Section 2.01(a) of the
Credit Agreement.  The Replacement Term
Loans shall be of the same Type as such Consenting Term Lender’s Existing Term
Loans.  In the case of any Consenting
Term Lender’s Existing Term Loans that are Eurodollar Rate Loans, the Interest
Period in effect immediately prior to the Third Amendment Effective Date with
respect to such Existing Term Loans shall be deemed to continue on and after
the Third Amendment Effective Date with respect to such Consenting Term Lender’s
Replacement Term Loans, so that (i) such Consenting Term Lender’s Replacement
Term Loans shall bear interest based on the Eurodollar Rate in effect with
respect to such Consenting Term Lender’s Existing Term Loans immediately prior
to the Third Amendment Effective Date, (ii) the initial Interest Period for
such Consenting Term Lender’s Replacement Term Loans shall end on the last day
of the Interest Period with respect to such Consenting Term Lender’s Existing
Term Loans in effect immediately prior to the Third Amendment Effective Date,
(iii) interest on such Consenting Term Lender’s Existing Term Loans shall be payable
at the end of the initial Interest Period for such Consenting Term Lender’s
Replacement Term Loans and (iv) no amounts shall be payable on the Third
Amendment Effective Date pursuant to Section 3.05 of the Credit Agreement as a
result of the replacement of such Consenting Term Lender’s Existing Term Loans
with Replacement Term loans.

 

(b)        Subject to the terms and conditions hereof, each Additional
Term Lender severally agrees to make Replacement Term Loans in Dollars to the Company
on the Third Amendment Effective Date. 
The aggregate principal amount of each Additional Term Leader’s
Replacement Term Loans (including Replacement Term Loans deemed to have been
made by such Additional Term Lender under paragraph (a) above (if any)) shall
equal such Additional Term Lender’s Term Commitment as defined in the Credit
Agreement after giving effect to this Amendment.  The Company shall apply the proceeds of the
Additional Term Loans first, to refinance and replace in full all Existing
Term Loans of the Non-Consenting Term Lenders and second, to (a) repay
all or any portion of the Permitted Holdco Debt, (b) pay management and
monitoring fees to the Sponsors pursuant to Section 7.08(d) of the Credit
Agreement as amended 

 

6

 

hereby, (c) make Restricted Payments pursuant to
Section 7.06(l)(z) of the Credit Agreement as amended hereby and/or (d)
repurchase from affiliates of Time Warner Inc. certain warrants to purchase
Equity Interests of Warner Music Group Corp. and Holdings.

 

(c)        Upon the Third Amendment Effective Date, the Replacement Term
Loans shall have the same terms, rights and obligations as the Term Loans as
set forth in the Loan Documents, except as modified by this Amendment, and all
references to (i) ”Term Lender” shall be deemed to be a reference to each Consenting
Term Lender and each Additional Term Lender and (ii) “Term Loan” shall be
deemed to be a reference to each Replacement Term Loan.

 

SECTION 4.  Amendments relating to
Replacement Term Loans.  (a)
Section 2.01(a) of the Credit Agreement is hereby amended by replacing the
reference to “ARCA Effective Date” therein with “Third Amendment Effective Date”.

 

(b)        Section 2.06(b) of the Credit Agreement is hereby amended by
replacing the reference to “ARCA Effective Date” therein with “Third Amendment
Effective Date”.

 

(c)        Section 2.07(a) of the Credit Agreement is amended by
replacing amortization schedule set forth therein with the following
amoritzation schedule:

 

	
  Date

  	
   

  	
  Aggregate Term 

  Loan Principal 

  Amortization Payment

  	
   

  
	
  May 2005

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  August 2005

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  November 2005

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  February 2006

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  May 2006

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  August 2006

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  November 2006

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  February 2007

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  May 2007

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  August 2007

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  November 2007

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  February 2008

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  May 2008

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  August 2008

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  November 2008

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  February 2009

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  May 2009

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  August 2009

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  November 2009

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  February 2010

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  May 2010

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  August 2010

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  November 2010

  	
   

  	
  $

  	
  4,220,200.00

  	
   

  
	
  February 2011

  	
   

  	
  $

  	
  1,340,935,400.00

  	
   

  

 

7

 

SECTION 5.  Mandatory Prepayments from
Excess Cash Flow and Specified Equity Issuances.  Section 2.05(b) of the Credit Agreement is
amended as follows:

 

(a)        By amending clause (i) thereof to read in its entirety as
follows:

 

“(i)  [Intentionally Omitted].”

 

(b)        By amending clause (iii) thereof to read in its entirety as
follows:

 

“(iii)  [Intentionally Omitted].”

 

SECTION 6.  Amendments to the Investments
Covenant. Section 7.02 of the Credit Agreement is amended as
follows:

 

(a)           By amending clause (i)(B) thereof to
read in its entirety as follows:

 

“(B) 
[Intentionally Omitted].”

 

(b)        By amending Clause (n) thereof to read in its entirety as
follows:

 

“(n)         so long as immediately after giving
effect to any such Investment, no Event of Default has occurred and is
continuing, other Investments that (net of any cash repayment of or return on
such Investments theretofore received) do not exceed $50,000,000 in any fiscal
year; provided that, such amounts may be
increased by (x) the Net Cash Proceeds of Permitted Equity Issuances which are
Not Otherwise Applied, (y) with respect to Investments other than Investments
in Joint Ventures, (i) the Net Cash Proceeds of Permitted Subordinated
Indebtedness permitted by Section 7.03(a)(iii)(A) which are Not Otherwise
Applied and (ii) the sum of the Rollover Amounts for the two preceding fiscal
years, to the extent that such Rollover Amounts have not been used to make
Capital Expenditures pursuant to Section 7.19(b); provided that
the Company shall promptly notify the Administrative Agent of any application
of any Rollover Amount pursuant to this clause (n) and (z) with respect to
Investments in Joint Ventures, the amount of any Investments made in Joint
Ventures in existence on the Closing Date as required by, or made pursuant to
buy/sell arrangements between the joint venture parties set forth in, joint
venture 

 

8

 

agreements
and similar binding arrangements in effect on the Closing Date; provided  further that,
to the extent that any such Investment (or series of related Investments) made
pursuant to this clause (n) consists of the contribution(s) or other
transfer(s) of property (other than cash) having an aggregate net book value in
excess of $5,000,000 to a Joint Venture for consideration less than the fair
market value of such property, then the Company shall have delivered to the
Administrative Agent a pro forma Compliance Certificate demonstrating that,
after giving Pro Forma Effect to such
Investment(s), the Loan Parties would be in compliance with the financial
covenants set forth in Section 7.11;”

 

SECTION 7.  Amendments to the Indebtedness
Covenant.  Section 7.03 of the
Credit Agreement is amended as follows:

 

(a)        By replacing “$50,000,000” where it appears in clause (b)(vi)(A)
thereof with “$100,000,000”.

 

(b)        By replacing “125,000,000” where it appears in (b)(xv)
thereof with “$175,000,000”.

 

SECTION 8.  Amendments to the Restricted
Payments Covenant.  (a) The last sentence of Section 7.06(i) of the Credit
Agreement is amended to read in its entirety as follows:

 

“For the purpose of this clause (i), “Cumulative
Excess Cash Flow” means the sum of Excess Cash Flow for (x) the period
commencing on the Third Amendment Effective Date and ending on September 30,
2005 and (y) each subsequent fiscal year commencing with the fiscal year ending
September 30, 2006 and ending with the Company’s most recently ended fiscal
year;”

 

(b)  Section 7.06(l) of the Credit Agreement is amended
by deleting “and” immediately prior to clause (y) thereof, and adding at the
end of clause (y) the following new clause (z):

 

“and (z) additional Restricted Payments consisting of cash dividends to
Holdings in an aggregate amount up to $160,000,000, the proceeds of which may
be used by Holdings to make additional Restricted Payments consisting of cash
dividends in an amount up to the amount of such Restricted Payments made by the
Company to Holdings; provided that
all such Restricted Payments referred to in this clause (z) shall be made
substantially simultaneously; and”

 

(c)        Section 7.06 of the Credit Agreement is amended by deleting “and”
at the end of paragraph (k) thereof, and adding the following new clause (m):

 

9

 

“(m)        In addition to the foregoing,
the Company may make additional Restricted Payments to Holdings and Holdings
may use the proceeds thereof to make additional Restricted Payments; provided that (i) the proceeds of such Restricted Payments
shall be applied solely to pay dividends on the common stock of Warner Music
Group Corp. and (ii) the amount of such Restricted Payments shall not exceed
$[90,000,000] in any fiscal year.”

 

SECTION 9.  Management Fee Settlement.  (a) Section 7.08(d) of the Credit
Agreement is amended to read in its entirety as follows:

 

“(d) so long as no Event of Default shall have occurred and be
continuing under Section 8.01(f), the payment of management and monitoring fees
to the Sponsors in settlement of all amounts payable pursuant to the Sponsor
Management Agreement in an aggregate amount not to exceed $75,000,000,”.

 

SECTION 10.  Amendment to Restrictions on
Prepayments.  Section 7.14(a)
of the Credit Agreement is amended by replacing “and” immediately prior to clause
(ii) thereof with a comma and by adding immediately after clause (ii) thereof
the following new clause (iii):

 

“and
(iii)  the repayment of all or any
portion of the Permitted Holdco Debt with the proceeds of the Restricted
Payment permitted by Section 7.06(l)(z).”

 

SECTION 11.  Amendment to Application
of Funds.  Section 8.03 of the
Credit Agreement is amended by adding immediately after “Secured Hedge
Obligations” where it appears in paragraph Fourth thereof
the words “, the Canadian LC Obligations”.

 

SECTION 12.  Amendment to Schedule
2.01.  Upon the Third
Amendment Effective Date, Schedule 2.01 to the Credit Agreement shall be replaced
in its entirety by the new Schedule 2.01 attached hereto as Schedule I.

 

SECTION 13.  Technical Amendments.  (a) Section
10.01 of the Credit Agreement is hereby amended by replacing the words “Applicable
Margin” each time they appear with the words “Applicable Rate”.

 

(b)        Schedule 5.12 to the Credit Agreement is hereby amended by
adding “Warner Music Ireland Finance Limited” thereto under the heading “Newly
Created Subsidiaries”.

 

10

 

(c)        Exhibit D to the Credit Agreement is amended by replacing
Schedule 2 to the Form of Compliance Certificate set forth therein with the Schedule
2 attached hereto as Exhibit A.

 

SECTION 14.  Conditions to
Effectiveness.  This Amendment
shall become effective on the date (the “Third Amendment Effective Date”) when,
and only when, each of the following conditions shall have been satisfied to the
satisfaction of the Administrative Agent:

 

(a)        The Execution of Counterparts.  The Administrative Agent shall have received
from each of Holdings, the Company, the Required Lenders and the Requisite Term
Lenders (defined below) a counterpart hereof signed by such party or facsimile
or other written confirmation (in form reasonably satisfactory to the
Administrative Agent) that such party has signed a counterpart hereof.  For the purposes hereof “Requisite
Term Lenders” means Consenting Term Lenders and Additional Term
Lenders providing Replacement Term Loans in an amount equal to (i) an amount
sufficient to refinance the Existing Term Loans, plus (ii) $250,000,000.

 

(b)        Expenses.  The
Administrative Agent shall have received reimbursement for all costs and
expenses (including fees, charges and disbursements of counsel to the Administrative
Agent) incurred in connection with the preparation, negotiation and execution
of this Amendment for which the Company shall have received written notice.

 

(c)        Evidence of Debt. 
Each Consenting Term Lender and each Additional Term Leader shall have
received, if requested by it, one or more Term Notes payable to the order of
such Term Lender duly executed by the Company in substantially the form of
Exhibit C-1 to the Credit Agreement, evidencing the Replacement Term Loans.

 

(d)        Interest, Etc. 
Simultaneously with the making of the Replacement Term Loans, the Company
shall have paid to all the Non-Consenting Term Lenders accrued and unpaid
interest on the Existing Term Loans to the Third Amendment Effective Date plus
additional amounts, if any, owing pursuant to Section 3.05 of the Credit
Agreement.

 

(e)        Execution of Consent. The Administrative Agent shall
have received counterparts of a consent substantially in the form of Exhibit B
to this Amendment, duly executed by each Subsidiary Guarantor.

 

(f)         Representations. 
The representations and warranties of Holdings, the Company and each
other Loan Party contained in Article 5 of the Credit Agreement or any other
Loan Document shall be true and correct in all material respects on and as of
the Third Amendment Effective Date, except to the extent 

 

11

 

that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct in all material respects as of such earlier date.

 

(g)        No Default.  No
Default or Event of Default shall exist on the Third Amendment Effective Date
after giving effect to this Amendment.

 

(h)        Consummation of Initial Public Offering.  On or prior to the earlier of (i) the Third
Amendment Effective Date and (ii) November 1, 2005, Warner Music Group Corp.
shall have consummated an initial public offering of its common stock generating
cash proceeds of not less than $500,000,000.

 

(i)         Leverage Ratio. 
After giving Pro Forma Effect
to the Replacement Term Loans and the application of proceeds thereof and the
initial public offering by Warner Music Group Corp and the application of
proceeds thereof, the Leverage Ratio shall be less than 4.25:1; provided that for the purpose of this paragraph (i) only, “Consolidated EBITDA” shall mean “EBITDA” as defined in the
Senior Subordinated Notes Indenture and as adjusted for the purpose of
calculating the “Fixed Charge Coverage Ratio” thereunder.

 

(j)         Debt Ratings Certificate.  The Administrative Agent shall have received
a certificate signed by a Responsible Officer of the Company certifying the
current Debt Ratings.

 

(k)        Mortgages.  The
Administrative Agent shall have received (x) evidence satisfactory to it that
mortgage amendments with respect to the Mortgages have been duly executed,
acknowledged and delivered by the Loan Party party thereto and are in form suitable
for filing and recording in all filing or recording offices that the
Administrative Agent may deem necessary or desirable, and that all filing and
recording taxes and fees have been paid or otherwise provided for in a manner
reasonably satisfactory to the Administrate Agent and (y) endorsement to title
insurance policies with respect to the mortgaged properties in form and
substances satisfactory to the Administrative Agent.

 

(l)         Responsible Officer’s Authority.  The Administrative Agent shall have received
such certificates of resolutions or other action, incumbency certificates
and/or other certificates of Responsible Officers of each Loan Party as the
Administrative Agent may reasonably require evidencing the identity, authority
and capacity of each Responsible Officer thereof authorized to act as a
Responsible Officer in connection with this Agreement and the other Loan
Documents to which such Loan Party is a party or is to be a party.

 

(m)       Existence, Authority, Good Standing etc.  The Administrative Agent shall have received
such documents and certifications as the Administrative Agent may reasonably
require to evidence that each Loan Party is duly organized or 

 

12

 

formed, and that each of the Borrowers and the
Guarantors is validly existing, in good standing and qualified to engage in
business in each jurisdiction where its ownership, lease or operation of
properties or the conduct of its business requires such qualification, except
to the extent that failure to be so qualified could not reasonably be expected
to have a Material Adverse Effect.

 

(n)        Opinions.  The
Administrative Agent shall have received such opinions as may reasonably be
requested by it, including an opinion of (A) Simpson, Thacher & Bartlett
LLP, New York counsel to the Loan Parties and (B) Paul Robinson, internal
counsel to the Loan Parties, each dated as of the Third Amendment Effective
Date, and each reasonably satisfactory to the Administrative Agent.

 

(o)        Committed Loan Notice. 
A Committed Loan Notice, as applicable, relating to the Replacement Term
Loans be made on the Third Amendment Effective Date.

 

SECTION 15.  Certain Consequences Of
Effectiveness.  On and after
the Third Amendment Effective Date, the rights and obligations of the parties
hereto shall be governed by the Credit Agreement as amended by this Amendment; provided that the rights and obligations of the parties to
the Credit Agreement with respect to the period prior to the Third Amendment
Effective Date shall continue to be governed by the provisions of the Credit
Agreement prior to giving effect to this Amendment.  Each Loan Document, as specifically amended
hereby, is, and shall continue to be, in full force and effect and is hereby
ratified and confirmed in all respects. 
Without limiting the foregoing, the Collateral Documents and all of the
Collateral do and shall continue to secure the payment of all Secured
Obligations (except to the extent limited by the terms of the Collateral
Documents), as amended hereby.

 

SECTION 16. 
Governing Law.  This Amendment shall be governed
by and construed in accordance with the laws of the State of New York.

 

SECTION 17. 
Counterparts.  This Amendment may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.  Delivery by telecopier of an executed
counterpart of a signature page to this Amendment shall be effective as
delivery of an original executed counterpart of this Amendment.

 

13

 

IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be duly executed as of the date first above written.

 

	
   

  	
  WMG
  ACQUISITION CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WMG
  HOLDINGS CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

	
   

  	
  BANK
  OF AMERICA, N.A., as Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A., as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

 

	
   

  	
  DEUTSCHE
  BANK AG, NEW YORK BRANCH  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

 

	
   

  	
  Name
  of Lender:

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
					

 

 

	
   

  	
  Name
  of Lender: 

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
					

 

 

SCHEDULE
I

 

SCHEDULE 2.01

 

COMMITMENTS

 

	
  Lender

  	
   

  	
  Tranche A 

  Revolving 

  Credit 

  Commitment

  	
   

  	
  Tranche B
 Revolving 

  Credit 

  Commitment

  	
   

  	
  Term 

  Commitment

  	
   

  	
  Total 

  Commitment

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

EXHIBIT A

 

For the Quarter/Year ended                
(“Statement Date”)

 

SCHEDULE 2

to the Compliance Certificate

($ in 000’s)

 

I.  Section 7.11(a) – Leverage Ratio

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  LTM

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Pro forma

  	
   

  	
  LTM

  	
   

  
	
   

  	
   

  	
  [Q1 

  	
   

  	
  [Q2 

  	
   

  	
  [Q3 

  	
   

  	
  [Q4 

  	
   

  	
  Adjustments 

  	
   

  	
  [Q4 

  	
   

  
	
   

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  (if any)

  	
   

  	
  Date]

  	
   

  
	
  A.
  Consolidated EBITDA

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.

  	
  Consolidated
  Net Income

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  The sum of,
  without duplication:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (i)

  	
  Total
  interest expense,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (ii)

  	
  Income,
  franchise and similar taxes and any tax distributions permitted to be made
  pursuant to Sections 7.06(h) (i) and (iii),

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (iii)

  	
  Depreciation
  and amortization expense,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (iv)

  	
  Letter of
  credit fees,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (v)

  	
  Non-cash expenses
  resulting from any employee benefit or management compensation plan or the
  grant of stock and stock options to employees of Holdings, the Company or any
  of their respective Subsidiaries pursuant to a written plan or agreement or
  the treatment of such options under variable plan accounting,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (vi)

  	
  All
  extraordinary charges,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (vii)

  	
  Non-cash
  amortization of financing costs,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (viii)

  	
  Cash
  expenses incurred in connection with the Transaction or, to the extent
  permitted under the Agreement, any Investment permitted under Section 7.02,
  Equity Issuance or Debt Issuance (in each case, whether or not consummated),

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (ix)

  	
  Any losses
  realized upon the disposition of property or assets outside of the ordinary
  course of business,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (x)

  	
  To the
  extent actually reimbursed, expenses incurred to the extent covered by
  indemnification provisions in any agreement in connection with a Permitted
  Acquisition,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  LTM

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Pro forma

  	
   

  	
  LTM

  	
   

  
	
   

  	
   

  	
  [Q1 

  	
   

  	
  [Q2 

  	
   

  	
  [Q3 

  	
   

  	
  [Q4 

  	
   

  	
  Adjustments 

  	
   

  	
  [Q4 

  	
   

  
	
   

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  (if any)

  	
   

  	
  Date]

  	
   

  
	
   

  	
  (xi)

  	
  To the
  extent covered by insurance, expenses with respect to liability or casualty
  events or business interruption,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xii)

  	
  Management
  fees permitted under Section 7.08(d),

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xiii)

  	
  Any non-cash
  purchase accounting adjustment and any step-ups with respect to re-valuing
  assets and liabilities in connection with the Transaction or any Investment
  permitted under Section 7.02,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xiv)

  	
  Non-cash
  losses from Joint Ventures and non-cash minority interest reductions,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xv)

  	
  Fees and
  expenses in connection with the issuance of the Senior Subordinated Notes or
  exchanges or refinancings permitted by Section 7.14,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xvi)

  	
  (A)
  Non-cash, non-recurring charges with respect to employee severance and
  (B) other non-cash, non-recurring charges so long as such charges
  described in this clause (B) do not result in a cash charge in a future
  period,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xvii)

  	
  Non-recurring
  cash charges of the types set forth in Schedule 1.01A of the Agreement
  incurred in an amount not greater than the applicable amount set forth in
  Schedule 1.01A,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xviii)

  	
  (A)
  Non-recurring cash restructuring charges incurred after the Closing Date and
  on or prior to the date which is 30 months after the Closing Date in connection
  with the implementation of the Company’s business plan, in an aggregate
  amount not to exceed $325,000,000, and (B) other non-recurring cash charges
  incurred after the Closing Date and on or prior to the date which is 30
  months after the Closing Date in connection with the restructuring of the
  Company’s artist portfolio, in an aggregate amount not to exceed $50,000,000,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  LTM

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Pro forma

  	
   

  	
  LTM

  	
   

  
	
   

  	
   

  	
  [Q1 

  	
   

  	
  [Q2 

  	
   

  	
  [Q3 

  	
   

  	
  [Q4 

  	
   

  	
  Adjustments 

  	
   

  	
  [Q4 

  	
   

  
	
   

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  (if any)

  	
   

  	
  Date]

  	
   

  
	
   

  	
  (xix)

  	
  Other
  expenses reducing Consolidated Net Income which do not represent a cash item
  in such period or any future period,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xx)

  	
  Net Cash
  Proceeds of any Permitted Equity Issuance to the Equity Investors solely to
  the extent that such Net Cash Proceeds (A) are actually received by the
  Borrowers (including through capital contribution of such Net Cash Proceeds
  by Holdings to the Company) no later than fifteen (15) Business Days after
  the delivery of a Notice of Intent to Cure, (B) are Not Otherwise Applied and
  (C) do not exceed the aggregate amount necessary to cure an Event of Default
  under Section 7.11 for any applicable period; provided
  that in each period of four fiscal quarters, there shall be at least two (2)
  fiscal quarters in which no such cure is made,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xxi)

  	
  Securitization
  Fees to the extent deducted in calculating Consolidated Net Income for such
  period, and

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (xxii)

  	
  Without duplication,
  pension curtailment expenses, transaction costs and executive contract
  expenses incurred by Affiliates of Holdings (other than Holdings and its
  Subsidiaries) on behalf of Holdings or any of its Subsidiaries and reflected
  in the combined financial statements of Holdings and its Subsidiaries as
  capital contributions.

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  The amount
  which, in determination of Consolidated Net Income, has been included for: 

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (i)

  	
  (A) non-cash
  income during such period (other than with respect to cash actually received)
  and (B) all extraordinary gains, and 

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  LTM

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Pro forma

  	
   

  	
  LTM

  	
   

  
	
   

  	
   

  	
  [Q1 

  	
   

  	
  [Q2 

  	
   

  	
  [Q3 

  	
   

  	
  [Q4 

  	
   

  	
  Adjustments 

  	
   

  	
  [Q4 

  	
   

  
	
   

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  (if any)

  	
   

  	
  Date]

  	
   

  
	
   

  	
  (ii)

  	
  any gains
  realized upon the disposition of property outside of the ordinary course of
  business

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  Unrealized
  losses/gains in respect of Swap Contracts, all as determined in accordance
  with GAAP

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  Consolidated
  EBITDA for four consecutive fiscal quarters ending on the above date (“Subject Period”) (Line I.A.1 + Total for I.A.2 – Line
  I.A.3 (+/-) Line I.A.4)

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B.  Adjusted
  Consolidated Funded Indebtedness (net of Cash On Hand) at Statement Date

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
  The sum of,
  without duplication:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (i)

  	
  All
  obligations for borrowed money,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (ii)

  	
  All
  obligations evidenced by bonds, debentures, notes or similar instruments,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (iii)

  	
  All
  obligations under conditional sale or other title retention agreements
  relating to property purchased (other than customary reservations or
  retentions of title under agreements with suppliers entered into in the
  ordinary course of business),

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (iv)

  	
  All
  obligations issued or assumed as the deferred purchase price of property or
  services purchased (other than accrued expenses and trade debt incurred in
  the ordinary course of business) which would appear as liabilities on a
  balance sheet and to the extent constituting contingent obligations,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (v)

  	
  All
  Consolidated Funded Indebtedness of others secured by (or for which the
  holder of such Consolidated Funded Indebtedness has an existing right,
  contingent or otherwise, to be secured by) any Lien on, or payable out of the
  proceeds of production from, property owned or acquired, whether or not the
  obligations secured thereby have been assumed,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  LTM

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Pro forma

  	
   

  	
  LTM

  	
   

  
	
   

  	
   

  	
  [Q1 

  	
   

  	
  [Q2 

  	
   

  	
  [Q3 

  	
   

  	
  [Q4 

  	
   

  	
  Adjustments 

  	
   

  	
  [Q4 

  	
   

  
	
   

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  Date]

  	
   

  	
  (if any)

  	
   

  	
  Date]

  	
   

  
	
   

  	
  (vi)

  	
  All
  Guarantees with respect to Consolidated Funded Indebtedness of another
  Person,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (vii)

  	
  The implied
  principal component of all obligations under Capitalized Leases,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (viii)

  	
  All drafts
  drawn (to the extent unreimbursed) under standby letters of credit issued or
  bankers’ acceptances facilities created,

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (ix)

  	
  Unless the
  holder thereof is a Loan Party or, if the issuer thereof is a Subsidiary of
  Holdings which is not a Loan Party, any other Subsidiary of Holdings, all
  Disqualified Equity Interests issued, and

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  (x)

  	
  The
  Consolidated Funded Indebtedness of any partnership or unincorporated joint
  venture in which such Person is a general partner or a joint venturer to the
  extent such Consolidated Funded Indebtedness is recourse to such Person.

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
  The term
  “Consolidated Funded Indebtedness” shall not be deemed to include (x) any
  earn-out obligation until such obligation becomes a liability on the balance
  sheet of the applicable Person, (y) any deferred compensation arrangements or
  (z) any non compete or consulting obligations incurred in connection
  with Permitted Acquisitions, and the amount of Consolidated Funded
  Indebtedness for which recourse is limited either to a specified amount or to
  an identified asset of such Person shall be deemed to be equal to such
  specified amount or the fair market value of such identified asset, as the
  case may be.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  ConsoTotal
  Consolidated Funded Indebtednesslidated Net Income

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
  C. 

  	
  Total
  Securitization Financing

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
																	

 

 

D.  Leverage
Ratio ((Line I.B.2 + Line I.C) ÷ Line I.A.5)  
__: 1.00

 

Maximum permitted: 

 

	
  Fiscal Year

  	
   

  	
  December 31

  	
   

  	
  March 31

  	
   

  	
  June 30

  	
   

  	
  September 30

  	
   

  
	
  2005

  	
   

  	
  6.5:1

  	
   

  	
  6.5:1

  	
   

  	
  6.5:1

  	
   

  	
  6.25.1

  	
   

  
	
  2006

  	
   

  	
  5.85:1

  	
   

  	
  5.5:1

  	
   

  	
  5.5:1

  	
   

  	
  5.35:1

  	
   

  
	
  2007

  	
   

  	
  4.85:1

  	
   

  	
  4.85:1

  	
   

  	
  4.75:1

  	
   

  	
  4.75:1

  	
   

  
	
  2008

  	
   

  	
  4.5:1

  	
   

  	
  4.5:1

  	
   

  	
  4.25:1

  	
   

  	
  4.25:1

  	
   

  
	
  2009

  	
   

  	
  4.0:1

  	
   

  	
  4.0:1

  	
   

  	
  3.75:1

  	
   

  	
  3.75:1

  	
   

  
	
  2010

  	
   

  	
  3.5:1

  	
   

  	
  3.5:1

  	
   

  	
  3.5:1

  	
   

  	
  3.5:1

  	
   

  

 

 

II.
Section 7.11(b) – Interest Coverage Ratio

 

	
   

  	
   

  	
  [Q1 Date]

  	
   

  	
  [Q2 Date]

  	
   

  	
  [Q3 Date]

  	
   

  	
  [Q4

  Date]

  	
   

  	
  LTM

  [Q4

  Date]

  	
   

  
	
  A.  Consolidated
  EBITDA (Line I.A.5 above)

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B.  Consolidated
  Interest Charges for Subject Period:  

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The amount payable in cash with respect to:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1. Interest expense, minus

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
  2. Interest income

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
  $

  	
   

  

 

C.  Interest
Coverage Ratio (Line II.A ÷ Total for II.B)  
__:1.00

 

Minimum required: 

 

	
  Fiscal Year

  	
   

  	
  December 31

  	
   

  	
  March 31

  	
   

  	
  June 30

  	
   

  	
  September 30

  	
   

  
	
  2005

  	
   

  	
  2.25:1

  	
   

  	
  2.25:1

  	
   

  	
  2.25:1

  	
   

  	
  2.25:1

  	
   

  
	
  2006

  	
   

  	
  2.5:1

  	
   

  	
  2.5:1

  	
   

  	
  2.5:1

  	
   

  	
  2.5:1

  	
   

  
	
  2007

  	
   

  	
  2.75:1

  	
   

  	
  2.75:1

  	
   

  	
  2.75:1

  	
   

  	
  2.75:1

  	
   

  
	
  2008

  	
   

  	
  2.75:1

  	
   

  	
  2.75:1

  	
   

  	
  2.75:1

  	
   

  	
  2.75:1

  	
   

  
	
  2009

  	
   

  	
  3.0:1

  	
   

  	
  3.0:1

  	
   

  	
  3.0:1

  	
   

  	
  3.0:1

  	
   

  
	
  2010

  	
   

  	
  3.25:1

  	
   

  	
  3.25:1

  	
   

  	
  3.25:1

  	
   

  	
  3.25:1

  	
   

  

 

 

EXHIBIT B

 

Each
of the undersigned hereby consents to the foregoing Amendment and hereby
confirms and agrees that (a) notwithstanding the effectiveness of such
Amendment, each Loan Document to which it is party is, and shall continue to
be, in full force and effect and is hereby ratified and confirmed in all
respects, except that, on and after the effectiveness of such Amendment, each
reference in the Loan Documents to the “Credit Agreement”, “thereunder”, “thereof”
or words of like import shall mean and be a reference to the Credit Agreement
as amended by such Amendment and (b) the Collateral Documents to which each of
the undersigned is a party and all of the Collateral described therein do, and
shall continue to, secure the payment of all of the Secured Obligations (in
each case, as defined therein) except to the extent limited by the terms of the
Collateral Documents.

 

 

	
   

  	
  [GUARANTORS]

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00083-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00083-of-00352.parquet"}]]