-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FNuMwBd4BNaZeB7IT4j7/xdORgqedhHAB0E5BrR7KHtgEwHFuNZQi/chemGtohTk GwLSn000X9TV5Rp63jG0jQ== 0000912057-00-025823.txt : 20000523 0000912057-00-025823.hdr.sgml : 20000523 ACCESSION NUMBER: 0000912057-00-025823 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000522 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OGDEN CORP CENTRAL INDEX KEY: 0000073902 STANDARD INDUSTRIAL CLASSIFICATION: AIRPORTS, FLYING FIELDS & AIRPORT TERMINAL SERVICES [4581] IRS NUMBER: 135549268 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-03122 FILM NUMBER: 641261 BUSINESS ADDRESS: STREET 1: TWO PENNSYLVANIA PLZ - 25TH FLR CITY: NEW YORK STATE: NY ZIP: 10121 BUSINESS PHONE: 2128686100 MAIL ADDRESS: STREET 1: TWO PENNSYLVANIA PLZ - 25TH FLR CITY: NEW YORK STATE: NY ZIP: 10121 10-Q 1 FORM 10-Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (Mark One) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES [X] EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2000 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES [ ] EXCHANGE ACT OF 1934 For the transition period from __________________ to __________________ Commission file number 1-3122 Ogden Corporation ------------------------------------- (Exact name of registrant as specified in its charter) Delaware 13-5549268 ------------------------------------ --------------------------------------- (State or other jurisdiction of (I.R.S. Employer Identification Number) incorporation or organization) Two Pennsylvania Plaza, New York, New York 10121 ---------------------------------------------------------------------- (Address or principal executive office) (Zip Code) (212) 868-6100 ---------------------------------------------------------------------- (Registrant's telephone number including area code) Not Applicable ---------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes |X| No |_| APPLICABLE ONLY TO CORPORATE ISSUERS: The number of shares outstanding of each of the issuer's classes of common stock, as of March 31, 2000; 49,611,187 shares of Common Stock, $.50 par value per share. PART 1. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS OGDEN CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
FOR THE THREE MONTHS ENDED MARCH 31, ---------------------- 2000 1999 --------- --------- (In Thousands of Dollars Except Per Share Data) Service revenues $ 204,165 $ 182,828 Net sales 9,629 13,031 Construction revenues 22,846 34,101 Net gain (loss) on sale of businesses (634) 4,864 --------- --------- Total revenues 236,006 234,824 --------- --------- Operating costs and expenses 157,522 135,559 Costs of goods sold 10,228 13,306 Construction costs 21,358 32,275 Selling, administrative and general expenses 21,337 19,305 Debt service charges 23,494 22,763 --------- --------- Total costs and expenses 233,939 223,208 --------- --------- Consolidated operating income 2,067 11,616 Equity in net income of investees and joint ventures 3,010 3,470 Interest income 973 2,095 Interest expense (9,458) (7,968) Other income (deductions) - net (45) 66 --------- --------- Income (loss) from continuing operations before income taxes, minority interests and the cumulative effect of change in accounting principle (3,453) 9,279 Income taxes 603 (3,004) Minority interests (1,324) (2,216) --------- --------- Income (loss) from continuing operations (4,174) 4,059 Income (loss) from discontinued operations (net of income taxes of: 2000, ($7,677) and 1999, $4,642) (25,310) 6,462 Cumulative effect of change in accounting principle (net of income taxes of $1,313) (3,820) --------- --------- Net Income (Loss) (29,484) 6,701 --------- --------- Other Comprehensive Income, Net of Tax: Foreign currency translation adjustments (4,874) (6,205) Unrealized Gains (Losses) on Securities: Unrealized holding losses arising during period (17) (120) --------- --------- Other comprehensive income (4,891) (6,325) --------- --------- Comprehensive income (loss) $ (34,375) $ 376 ========= ========= Basic Earnings Per Share: Income (loss) from continuing operations $ (0.08) $ 0.08 Income (loss) from discontinued operations (0.51) 0.13 Cumulative effect of change in accounting principle (0.08) --------- --------- Net Income (Loss) $ (0.59) $ 0.13 ========= ========= Diluted Earnings Per Share: Income (loss) from continuing operations $ (0.08) $ 0.08 Income (loss) from discontinued operations (0.51) 0.13 Cumulative effect of change in accounting principle (0.08) --------- --------- Net Income (Loss) $ (0.59) $ 0.13 ========= =========
OGDEN CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
March 31, December 31, 2000 1999 ----------- ----------- (In Thousands of Dollars) Assets Current Assets: Cash and cash equivalents $ 80,223 $ 101,020 Restricted funds held in trust 118,025 103,662 Receivables (less allowances: 2000, $18,886 and 1999, $17,942) 252,800 294,051 Inventories 12,126 10,767 Deferred income taxes 36,189 36,189 Other 80,668 79,052 Net assets of discontinued operations 552,366 568,146 ----------- ----------- Total current assets 1,132,397 1,192,887 Property, plant and equipment - net 1,833,704 1,841,811 Restricted funds held in trust 146,939 166,784 Unbilled service and other receivables 170,142 159,457 Unamortized contract acquisition costs 93,606 94,998 Goodwill and other intangible assets 12,284 12,520 Investments in and advances to investees and joint ventures 181,800 180,523 Other assets 71,878 78,168 ----------- ----------- Total Assets $ 3,642,750 $ 3,727,148 =========== =========== Liabilities and Shareholders' Equity Liabilities: Current liabilities: Current portion of long-term debt $ 114,418 $ 113,815 Current portion of project debt 85,504 80,383 Accounts payable 70,104 75,169 Accrued expenses, etc 345,214 360,155 Deferred income 45,075 45,806 ----------- ----------- Total current liabilities 660,315 675,328 Long-term debt 342,337 344,945 Project debt 1,361,057 1,390,832 Deferred income taxes 380,851 380,812 Deferred income 180,066 182,663 Other liabilities 125,236 127,559 Minority interests 34,030 33,309 Convertible subordinated debentures 148,650 148,650 ----------- ----------- Total Liabilities 3,232,542 3,284,098 ----------- ----------- Shareholders' Equity: Serial cumulative convertible preferred stock, par value $1.00 per share; authorized, 4,000,000 shares; shares outstanding: 37,127 in 2000 and 39,246 in 1999, net of treasury shares of 29,820 in 2000 and 1999 37 39 Common stock, par value $.50 per share; authorized, 80,000,000 shares; shares outstanding: 49,611,187 in 2000 and 49,468,195 in 1999, net of treasury shares of 4,290,195 and 4,405,103, respectively 24,806 24,734 Capital surplus 185,395 183,915 Earned surplus 225,681 255,182 Accumulated other comprehensive income (25,711) (20,820) ----------- ----------- Total Shareholders' Equity 410,208 443,050 ----------- ----------- Total Liabilities and Shareholders' Equity $ 3,642,750 $ 3,727,148 =========== ===========
OGDEN CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
THREE MONTHS ENDED YEAR ENDED MARCH 31, 2000 DECEMBER 31, 1999 SHARES AMOUNTS SHARES AMOUNTS ------------ --------- ----------- -------- (In thousands of dollars, except per-share amounts) Serial Cumulative Convertible Preferred Stock, Par Value $1.00 Per Share; Authorized, 4,000,000 Shares: Balance at beginning of period 69,066 $ 69 72,038 $ 73 Shares converted into common stock (2,119) (2) (2,972) (4) ------------ --------- ----------- -------- Total 66,947 67 69,066 69 Treasury shares (29,820) (30) (29,820) (30) ------------ --------- ----------- -------- Balance at end of period (aggregate involuntary liquidation value - 2000, $748) 37,127 37 39,246 39 ------------ --------- ----------- -------- Common Stock, Par Value $.50 Per Share; Authorized, 80,000,000 Shares: Balance at beginning of period 53,873,298 26,937 53,507,952 26,754 Exercise of stock options 155,801 78 Shares issued for acquisition 15,390 8 191,800 96 Conversion of preferred shares 12,658 6 17,745 9 ------------ --------- ----------- -------- Total 53,901,346 26,951 53,873,298 26,937 ------------ --------- ----------- -------- Treasury shares at beginning of period 4,405,103 2,203 4,561,963 2,281 Purchase of treasury shares 102,000 51 Issuance of restricted stock (114,944) (58) Exercise of stock options (258,860) (129) ------------ --------- ----------- -------- Treasury shares at end of period 4,290,159 2,145 4,405,103 2,203 ------------ --------- ----------- -------- Balance at end of period 49,611,187 24,806 49,468,195 24,734 ------------ --------- ----------- -------- Capital Surplus: Balance at beginning of period 183,915 173,413 Exercise of stock options 8,061 Issuance of restricted stock 1,312 Shares issued for acquisition 172 4,904 Purchase of treasury shares (2,458) Conversion of preferred shares (4) (5) --------- -------- Balance at end of period 185,395 183,915 --------- -------- Earned Surplus: Balance at beginning of period 255,182 367,984 Net income (loss) (29,484) (81,961) --------- -------- Total 225,698 286,023 --------- -------- Preferred dividends - per share 2000, $.46875, and 1999, $3.35 17 137 Common dividends - per share 1999, $.625 30,704 --------- -------- Total Dividends 17 30,841 --------- -------- Balance at end of period 225,681 255,182 --------- -------- Cumulative Translation Adjustment - Net (25,537) (20,663) --------- -------- Minimum Pension Liability Adjustment (307) (307) --------- -------- Net Unrealized Gain on Securities Available For Sale 133 150 --------- -------- TOTAL SHAREHOLDERS' EQUITY $ 410,208 $443,050 ========= ========
OGDEN CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, ---------------------- 2000 1999 --------- --------- (In Thousands of Dollars) CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ (29,484) $ 6,701 Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities of Continuing Operations: (Income) Loss from discontinued operations 25,310 (6,462) Depreciation and amortization 25,013 20,181 Deferred income taxes 42 4,969 Cumulative effect of change in accounting principle 3,820 Other (1,809) (10,367) Management of Operating Assets and Liabilities: Decrease (Increase) in Assets: Receivables 22,785 (5,246) Inventories (1,512) 1,627 Other assets (1,754) 2,724 Increase (Decrease) in Liabilities: Accounts payable (3,398) 13,023 Accrued expenses (11,766) 4,962 Deferred income 1,146 (489) Other liabilities (9,478) (27,160) --------- --------- Net cash provided by operating activities of continuing operations 15,095 8,283 --------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sale of businesses 4,848 9,760 Proceeds from sale of property, plant and equipment 130 Proceeds from sale of marketable securities available for sale 3,574 25,934 Entities purchased, net of cash acquired (59,924) Investments in facilities (10,873) (4,170) Other capital expenditures (4,188) (3,813) Distributions from investees and joint ventures 4,137 6,120 Increase in investments in and advances to investees and joint ventures (2,284) (14,834) --------- --------- Net cash used in investing activities of continuing operations (4,786) (40,797) --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings for facilities 55,766 Other new debt 652 18,659 Decrease (increase) in funds held in trust 5,483 (35,084) Payment of debt (83,037) (12,311) Dividends paid (17) (15,400) Purchase of treasury shares (2,509) Proceeds from exercise of stock options 424 Other (603) (782) --------- --------- Net cash used in financing activities of continuing operations (21,756) (47,003) --------- --------- Net cash used in discontinued operations (9,350) (10,302) --------- --------- Net Decrease in Cash and Cash Equivalents (20,797) (89,819) Cash and Cash Equivalents at Beginning of Period 101,020 181,169 --------- --------- Cash and Cash Equivalents at End of Period $ 80,223 $ 91,350 ========= =========
ITEM 1 - BASIS OF PRESENTATION The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all information and footnotes necessary for a fair presentation of financial position, results of operations, and cash flows in conformity with generally accepted accounting principles. However, in the opinion of Management, all adjustments consisting of normal recurring accruals necessary for a fair presentation of the operating results have been included in the statements. On January 1, 1999 Ogden Corporation (hereinafter together with its consolidated subsidiaries referred to as "Ogden" or the "Company") adopted the American Institute of Certified Public Accountants Statement of Position (SOP) 98-5 "Reporting on the Costs of Start-Up Activities". This SOP established accounting standards for these costs and requires they generally be expensed as incurred. The effect of the adoption of this SOP was a charge of $3,820,000 net of income taxes of $1,313,000 recorded as a cumulative effect of change in accounting principle in the accompanying financial statements. The accompanying financial statements for the prior period have been reclassified as to certain amounts to conform with the 2000 presentation. DISCONTINUED OPERATIONS: On September 29, 1999, the Board of Directors of the Company approved a plan to dispose of all of the operations of the Entertainment and Aviation segments and to report the results of operations from those segments prospectively as Discontinued Operations. Information for two segments previously reflected under the segment headings "Energy" and "Other" are now reported as Continuing Operations and will continue to be reported under those headings. At March 31, 2000, the Company had approximately $552,000,000 in net assets associated with its discontinued operations. In addition, the Company had associated debt with respect to the discontinued operations of approximately $140,000,000. Since September 29, 1999 the Company has retained financial advisors to assist it in determining how best to group the assets to maximize sales proceeds. As part of that process, on May 12, 2000 the Company closed its previously announced transaction for the sale of its Themed Parks and Attractions, other than its Jazzland theme park, which it expects to close within the next thirty days. Further, the Company expects to close the sale of substantially all of its Food and Beverage/Venue Management business within the next thirty days. The Company received second round bids for its Aviation business on May 11, 2000, and is currently evaluating how to maximize the sales proceeds of those assets based on the bids received. The Company is in various stages with respect to the disposition of a number of other assets included within discontinued operations. Finally, certain aspects of the businesses will require the Company to pay monies to terminate leases or cancel other contractual commitments. Based upon the anticipated results of the sales processes, gains and losses on disposal of portions of the discontinued operations will be deferred until substantially all assets of the discontinued operations have been sold. At March 31, 2000, the Company has deferred a total of $658,000 in net gains on sales of assets of discontinued operations. Also, for the three months ended March 31, 2000, the Company accrued 1 approximately $18,000,000 representing estimated pretax net operating losses of its discontinued operations through their respective anticipated dates of disposal. The Company believes that it will receive net proceeds equal to or in excess of its carrying value of net assets of its discontinued operations. Net sales and income (loss) from discontinued operations are as follows:
Three Months Ended March 31 -------------------------- 2000 1999 --------- --------- (In Thousands of Dollars) Revenues $ 155,605 $ 161,722 ========= ========= Income (Loss) Before Income Taxes and Minority Interests (33,033) 10,841 Provision (Benefit) for Income Taxes (7,677) 4,642 Minority Interests (46) (263) --------- --------- Income (Loss) from Discontinued Operations $ (25,310) $ 6,462 ========= =========
Net assets of discontinued operations were as follows:
MARCH 31, 2000 DECEMBER 31, 1999 -------------- ----------------- (In Thousands of Dollars) Current Assets $ 218,010 $ 221,200 Property, Plant and Equipment - Net 368,275 375,211 Other Assets 332,284 336,700 Notes Payable, and Current Portion of Long-Term Debt (45,545) (51,081) Other Current Liabilities (170,027) (142,327) Long-Term Debt (94,188) (108,681) Other Liabilities (56,443) (62,876) --------- --------- Net Assets of Discontinued Operations $ 552,366 $ 568,146 ========= =========
2 SPECIAL CHARGES: As a result of the Company's Board of Directors' plan to dispose of its Aviation and Entertainment businesses and close its New York City headquarters, and its plan to exit other noncore businesses, the Company incurred various expenses in 1999 which were recognized in its continuing and discontinued operations. Of those charges, certain cash charges related to severance costs, mainly for its New York City employees, and contract termination costs of its former Chairman and Chief Executive Officer were not fully paid. The following is a summary of those costs and related payments during the three months ended March 31, 2000 (expressed in thousands of dollars):
ADDITIONAL PROVISIONS AMOUNTS PAID DURING THREE DURING THREE BALANCE AT MONTHS ENDED MONTHS ENDED BALANCE AT DECEMBER 31,1999 MARCH 31, 2000 MARCH 31, 2000 MARCH 31, 2000 ---------------- -------------- -------------- -------------- Severance for approximately 230 employees $40,400 $1,200 $4,100 $37,500 Contract termination settlement 15,700 1,300 14,400 ------- ------ ------ ------- $56,100 $1,200 $5,400 $51,900 ======= ====== ====== =======
The additional provisions for the three months ended March 31, 2000 were comprised of $300,000 for continuing operations and $900,000 for discontinued operations. 3 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OPERATIONS: Revenues and income (loss) from continuing operations (expressed in thousands of dollars) by segment for the three months ended March 31, 2000 and 1999 were as follows:
Three Months Ended March 31, Information Concerning Business Segments 2000 1999 - ------------------------------------------------------------------------------------------------- (In Thousands of Dollars) Revenues: Energy $ 222,168 $ 217,068 Other 13,838 17,756 --------- --------- $ 236,006 $ 234,824 ========= ========= Income (Loss) from Operations: Energy $ 10,218 $ 16,814 Other (2,611) (1,275) --------- --------- Total Income from Operations 7,607 15,539 Equity in net income of investees and joint ventures: Energy 3,010 3,470 --------- --------- Total 10,617 19,009 Corporate unallocated income and expenses - net (5,585) (3,857) Interest - net (8,485) (5,873) --------- --------- Income (loss) from continuing operations before income taxes, minority interests and the cumulative effect of change in accounting principle $ (3,453) $ 9,279 ========= =========
CONTINUING OPERATIONS: Revenues for the first three months of 2000 were $1,200,000 higher than the comparable period of 1999 primarily reflecting an increase in the Energy segment revenues of $5,100,000. Increases in the Energy segment's revenues of $21,300,000 were primarily due to new plants in Thailand ($9,400,000) and The Philippines ($3,500,000) that began operations subsequent to the first quarter of 1999, the acquisition of an additional 50% interest in a power plant in California in June of 1999 ($4,300,000) and increases at several waste-to-energy facilities primarily the Tulsa, Oklahoma facility ($1,500,000) reflecting a renegotiated service agreement that became effective in April of 1999, an increase in the Union County, New Jersey facility ($1,000,000) due to an increase in energy revenues, with the remaining increase ($1,600,000) primarily attributed to contractual annual escalation adjustments at various other facilities. These increases were partially offset by a gain in the comparable period of 1999 of $4,900,000 on the sale of the Company's interest in a joint venture in Maine, as well as reduced construction revenues of $11,300,000 reflecting a decrease in civil construction activity ($8,600,000) due to the completion of some projects in 1999 and a decrease 4 in retrofit activity ($4,000,000) partially offset by an increase in water and wastewater construction ($1,300,000). In 1999, the Company adopted a plan to sell its environmental consulting and engineering business and to discontinue its civil construction projects. Management anticipates that the remaining construction projects will be completed during 2000, with the exception of one project that is expected to continue into 2001. Therefore, the Company anticipates a continued decline in civil construction activity during 2000 as projects are completed. In addition, retrofit construction activity will also decline, as facilities attain compliance with the Clean Air Act Amendments of 1990 which is mandated by the end of 2000. These increases in the Energy segment's revenues were offset by lower revenues of $3,900,000 in the Other segment primarily due to reduced activity in Datacom's operations chiefly associated with the Chapter XI bankruptcy filing in March 2000 of Genicom Corporation, its major customer, and a $600,000 loss on the sale of Applied Data Technology, Inc. (ADTI) at the end of March 2000. Consolidated operating income for the first three months of 2000 was $9,500,000 lower than the comparable period of 1999. The Energy segment's income from operations was $6,600,000 lower chiefly associated with a gain of $4,900,000 recognized in the comparable period in 1999 on the sale of the Company's interest in a joint venture in Maine, additional depreciation expense of $1,800,000 in connection with shortened estimated useful lives of certain air pollution control equipment resulting from the Clean Air Act Amendments, and increased overhead expenses of $1,600,000 relating to the expansion of the power business, as well as a decrease in operating income from construction of $400,000. These decreases were partially offset by net increases in operating income of $2,100,000 from several projects including new plants that became operational subsequent to the comparable period in 1999. In addition, the Other segment's income from operations was $1,300,000 lower primarily due to lower activity at Datacom, chiefly associated with the Chapter XI bankruptcy filing in March 2000 of Genicom ($1,200,000), as well as the loss on the sale of ADTI in the first quarter ($600,000). Selling and administrative expenses were $2,000,000 higher primarily associated with increased overhead costs related to international office expansion for the Energy segment and increased corporate severance and overhead costs. Debt service charges increased approximately $700,000 compared with the comparable period of 1999 due mainly to higher project debt associated with new projects. The Energy segment has one interest rate swap agreement entered into as a hedge against interest rate exposure on adjustable-rate project debt that resulted in additional debt service expense of $400,000 and $700,000 for the periods ended March 31, 2000 and 1999, respectively. Interest income for the first three months of 2000 was $1,100,000 lower than the comparable period of 1999 primarily reflecting lower cash balances available for investments. Interest expense was $1,500,000 higher chiefly associated with increased borrowings on the Company's revolving line of credit and higher interest rates on adjustable rate debt. 5 In addition, the Company had one swap agreement covering a notional amount of $1,200,000 which converted the Entertainment segment's $1,200,000 variable rate debt to a fixed rate, and expires November 30, 2000. Additional interest expense relating to this swap agreement was not significant for the three-month periods ended March 31, 2000 and 1999. Equity in net income of investees and joint ventures decreased by $500,000 primarily reflecting the effect of a settlement in the comparable period of 1999 with a customer amounting to $1,600,000, offset by a net increase in 2000 in earnings of $1,100,000 due to increased generation on existing projects ($900,000) and income related to a new project that became operational during the third quarter of 1999 ($200,000). The effective income tax rate for the three months ended March 31, 2000 was 17.5% compared with 32.4% for 1999. This decrease in the effective rate was primarily due to higher foreign income taxed at rates lower than the Federal statutory rate and the effect of energy tax credits. DISCONTINUED OPERATIONS: Loss from discontinued operations for the first three months of 2000 was $25,300,000, a decrease in earnings of $31,800,000 from the comparable period of 1999. Operating income (loss) of discontinued operations was ($30,500,000) in the first three months of 2000 compared to $11,000,000 in the same period of 1999. This $41,500,000 change was chiefly associated with a decrease of $30,500,000 in income from operations of the Entertainment segment, primarily reflecting a provision of $18,700,000 for estimated pretax net operating losses from April 1, 2000 through the anticipated dates of sales of the businesses. In addition, Entertainment had a decrease of $11,800,000 in income from operations primarily reflecting a gain of $6,000,000 in 1999 on the renegotiation of a revised management contract at Arrowhead Pond, increased legal, accounting, and consulting expenses, and additional depreciation expense in connection with shortened estimated useful lives of management information systems ending on the expected dates of disposition of the businesses plus the related transition period, as well as overhead costs in connection with the discontinuance of the businesses of $5,200,000 and start-up costs of $2,800,000 at the Water Parks and Jazzland theme park. These decreases were partially offset by a net increase of $3,800,000 in sports and convention centers and venue management activity. The Aviation segment's income from operations was $11,000,000 lower primarily reflecting a $4,000,000 gain on the sale of an ownership interest in the Hong Kong ground services company and an insurance recovery of $1,500,000, both occurring in 1999; lower fueling and ground service income of $2,800,000 reflecting lower customer activity; and increased legal, accounting, consulting and overhead costs of $4,100,000 in connection with the discontinuance of the business. CAPITAL INVESTMENTS AND COMMITMENTS: For the three months ended March 31, 2000, capital investments for continuing operations amounted to $15,100,000, of which $14,900,000 was for Energy and $200,000 was for Other operations. At March 31, 2000, capital commitments for continuing operations amounted to $10,000,000 for normal replacement and growth in Energy. Other capital commitments for Energy as of March 31, 2000 amounted to approximately $100,500,000. This amount 6 includes a commitment to pay, in 2008, $10,600,000 for a service contract extension at an energy facility. In addition, this amount includes $28,000,000 for a 50% interest in a project in Thailand; $27,200,000 and $15,300,000, respectively, for two oil-fired projects in India; $3,400,000 for additional equity commitments related to a coal-fired power project in the Philippines; $2,200,000 for a mass-burn waste-to-energy facility in Italy; and $13,800,000 for standby letters of credit in support of debt service reserve requirements. Funding for the additional mandatory equity contributions to the coal-fired power project in the Philippines is being provided through bank credit facilities, which are due to be repaid in 2000. In addition, compliance with the standards and guidelines under the Clean Air Act Amendments of 1990 will require further Energy capital expenditures of approximately $20,000,000 through December 2000, subject to the final time schedules determined by the individual states in which the Company's waste-to-energy facilities are located. Commitments for Discontinued Operations amounted to $21,200,000 for normal replacement and growth in Aviation ($200,000) and Entertainment ($21,000,000), the latter relating primarily to Entertainment's Jazzland theme park in New Orleans, Louisiana. As part of its agreement to sell its themed attractions, the Company has agreed to complete the construction of the Jazzland theme park. Ogden and certain of its subsidiaries have issued or are party to performance bonds and guarantees and related contractual obligations undertaken mainly pursuant to agreements to construct and operate certain waste-to-energy, entertainment, and other facilities. In the normal course of business, they are involved in legal proceedings in which damages and other remedies are sought. Management does not expect that these contractual obligations, legal proceedings, or any other contingent obligations incurred in the normal course of business will have a material adverse effect on Ogden's Consolidated Financial Statements. The Company did not include its interests in either the Arrowhead Pond in Anaheim, California or the Corel Centre near Ottawa, Canada as part of the sale of its Venue Management business announced in March 2000. The Company manages the Arrowhead Pond under a long-term contract. As part of this contract, the Company is a party, along with the City of Anaheim, to a reimbursement agreement in connection with a letter of credit in the amount of approximately $120,000,000. Under the reimbursement agreement, the Company is responsible for draws, if any, under the letter of credit caused by the Company's failure to perform its duties under its management contract at that venue. The Company is exploring alternatives for disposing of the Arrowhead Pond and Corel Centre, discussed below, along with the related obligations. During 1994, a subsidiary of Ogden entered into a 30-year facility management contract at the Corel Centre pursuant to which it agreed to advance funds to a customer, and if necessary, to assist the customer's refinancing of senior secured debt incurred in connection with the construction of the facility. Ogden is obligated to purchase such senior debt in the amount of $97,100,000 on December 23, 2002, if the debt is not refinanced prior to that time. Ogden is also required to repurchase the outstanding amount of certain subordinated secured debt of such customer on December 23, 2002. At March 31, 2000, the amount outstanding was $51,600,000. In addition, as of March 31, 2000, the Company 7 had guaranteed $3,400,000 of senior secured term debt of an affiliate and principal tenant (the NHL Ottawa Senators) of this customer and had guaranteed up to $3,400,000 of the tenant's secured revolving debt. Further, Ogden is obligated to purchase $20,600,000 of the tenant's secured subordinated indebtedness on January 29, 2004, if such indebtedness has not been repaid or refinanced prior to that time. In October 1999, Ogden also agreed to advance a secured loan to that tenant of up to approximately $8,400,000 if certain events occur, of which $2,100,000 had been advanced at March 31, 2000. Separately, Ogden has guaranteed approximately $3,600,000 of borrowings of a customer of Metropolitan Entertainment Group, an Entertainment joint venture in which Ogden has an equity interest. The Company expects this guarantee to be assumed by the ultimate purchaser of this interest. Management does not expect that these arrangements will have a material adverse effect on Ogden's Consolidated Financial Statements. LIQUIDITY/CASH FLOW: Net cash provided by operating activities of continuing operations was $6,800,000 higher than the comparable period of 1999 primarily reflecting a reduction in accounts receivable of $28,000,000, and a decrease of $17,700,000 in other liabilities. These increases were partially offset by a decrease in income from continuing operations of $8,200,000 and a reduction of $33,100,000 in accrued expenses and accounts payable. Net cash used in investing activities was $36,000,000 lower primarily relating to a decrease of $59,900,000 in entities purchased and a net decrease of $10,600,000 in distributions from and investments in and advances to joint ventures. These decreases were partially offset by lower proceeds from the sale of marketable securities of $22,300,000, higher capital expenditures of $7,100,000 and lower proceeds from the sale of businesses of $4,900,000. Net cash used in financing activities was $25,200,000 lower primarily due to a decrease of $40,600,000 of funds held in trust, a reduction of dividends paid of $15,400,000 and in the purchase of treasury shares of $2,500,000. These decreases were partially offset by a net decrease in outstanding debt of $33,000,000. At March 31, 2000, the Company had approximately $127,000,000 in cash and cash equivalents, of which $80,000,000 related to continuing operations. In addition, the Company has a revolving credit facility, on which the Company had drawn $50,000,000 at March 31, 2000. The Company has agreed with its credit providers (including its revolving credit lenders and certain other banks that have similar covenants in their respective facilities, collectively the "Credit Providers"), to amend financial covenants requiring the Company to maintain certain ratios with respect to its indebtedness as a percentage of its capitalization, its interest coverage as a function of income from continuing operations and its minimum shareholders' equity, effective to July 31, 2000. These amendments were necessary as a result of the financial effects of the Company's decision to place the Aviation and Entertainment segments in discontinued operations and complete the sales of those units. It is likely that these waivers will need to be extended past July 31, 2000. In addition, the Credit Providers granted the Company permission to sell its Aviation and Entertainment units, subject to certain minimum prices with respect to certain of the assets. In addition, the lenders agreed to amend the revolving credit agreement to permit the Company to retain the first $100,000,000 in cash received from the asset sales and, in addition, provided the Company with a $50,000,000 liquidity facility (in addition to currently outstanding amounts), which facility is secured by certain assets of the Company. The Company has agreed to place all cash proceeds received from the sales of the units in 8 excess of $100,000,000 in a segregated account to be applied to pay down existing debt. The Company has further agreed not to incur any indebtedness other than that incurred under the revolving credit facility. In order to make additional Energy investments other than certain specified permitted investments, the Company will require a substantial majority of its Credit Providers to consent to such investments. To the extent the $50,000,000 liquidity facility is drawn, such amounts will be required to be repaid by July 31, 2000. In consideration for these concessions, the Company paid or will pay fees to the lending group of approximately $12,000,000. On May 12, 2000 the Company closed its previously announced transaction for the sale of its Themed Parks and Attractions, other than its Jazzland theme park, which it expects to close within the next thirty days. Further, the Company expects to close the sale of a substantial majority of its Food and Beverage/Venue Management business within the next thirty days. The Company received second round bids for its Aviation business on May 11, 2000, and is currently evaluating how to maximize the sales proceeds of those assets based on bids received. The Company also determined in the fourth quarter of 1999 to sell all of the operations currently reflected in the "Other Segment" and decided to sell its domestic Environmental Consulting business and its Spanish subsidiary, and to wind down the operations of its civil construction business, all of which are reported in its Energy segment. To that end, the Company closed the sale transaction of its ADTI unit at the end of March 2000. Accordingly, the Company expects to have sufficient proceeds to fund normal operations (including certain permitted energy investments), and repay certain other indebtedness on or before the maturity date. The Company continues to explore possible new credit facilities and/or obtaining equity for such purposes, including discussions with its existing Credit Providers. Under certain agreements entered into by the Company, if the Company's outstanding debt securities are no longer rated investment grade, the Company may be required to post additional collateral or letters of credit. The failure to post such letters could result in a forfeiture of certain contracts or could result in a default under the agreements requiring the posting of such letters. Such a default would also be a default under the Company's credit facilities. With the consent of its Credit Providers, the Company could cash collateralize these obligations or potentially utilize sales proceeds for such purpose; alternatively, the Credit Providers could provide such letters directly, or the Company could raise equity for such purpose. The Credit Providers have agreed to work with the Company to explore solutions to this issue should it arise. In addition, from June 2 through July 31, 2000, the Company will need to renew certain letters of credit which have been issued by certain members of its lending group. Failure to obtain the renewal of these letters of credit could give rise to defaults pursuant to the terms of the underlying agreements. The Company believes its recent agreement with its Credit Providers is consistent with its prior stated intention of using the proceeds from the sales of the Entertainment and Aviation businesses to pay down existing debt. 9 ANY STATEMENTS IN THIS COMMUNICATION WHICH MAY BE CONSIDERED TO BE "FORWARD-LOOKING STATEMENTS," AS THAT TERM IS DEFINED IN THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995, ARE SUBJECT TO CERTAIN RISK AND UNCERTAINTIES. THE FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE SUGGESTED BY ANY SUCH STATEMENTS INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED OR IDENTIFIED FROM TIME TO TIME IN THE COMPANY'S PUBLIC FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION AND MORE GENERALLY, GENERAL ECONOMIC CONDITIONS, INCLUDING CHANGES IN INTEREST RATES AND THE PERFORMANCE OF THE FINANCIAL MARKETS; CHANGES IN DOMESTIC AND FOREIGN LAWS, REGULATIONS, AND TAXES, CHANGES IN COMPETITION AND PRICING ENVIRONMENTS; AND REGIONAL OR GENERAL CHANGES IN ASSET VALUATIONS. 10 PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS The Company has various legal proceedings involving matters arising in the ordinary course of business. The Company does not believe that there are any pending legal proceedings, other than ordinary routine litigation incidental to its business, to which the Company is a party or to which any of its property is subject, the outcome of which would have a material adverse effect on the Company's consolidated position or results of operation. The Company's operations are subject to various Federal, state and local environmental laws and regulations, including the Clean Air Act, the Clean Water Act, the Comprehensive Environmental Response Compensation and Liability Act (CERCLA) and Resource Conservation and Recovery Act (RCRA). Although the Company's operations are occasionally subject to proceedings and orders pertaining to emissions into the environment and other environmental violations, the Company believes that it is in substantial compliance with existing environmental laws and regulations. In connection with certain previously divested operations, the Company may be identified, along with other entities, as being among potentially responsible parties responsible for contribution for costs associated with the correction and remediation of environmental conditions at various hazardous waste disposal sites subject to CERCLA. In certain instances the Company may be exposed to joint and several liability for remedial action or damages. The Company's ultimate liability in connection with such environmental claims will depend on many factors, including its volumetric share of waste, the total cost of remediation, the financial viability of other companies that also sent waste to a given site and its contractual arrangement with the purchaser of such operations. The potential costs related to all of the foregoing matters and the possible impact on future operations are uncertain due in part to the complexity of government laws and regulations and their interpretations, the varying costs and effectiveness of cleanup technologies, the uncertain level of insurance or other types of recovery, and the questionable level of the Company's responsibility. Although the ultimate outcome and expense of any litigation, including environmental remediation, is uncertain, the Company believes that the following proceedings will not have a material adverse effect on the Company's consolidated financial position or results of operations. II-1 (a) Environmental Matters (i) In an ongoing criminal investigation by the U.S. Department of Justice Ogden has contested that the Company has criminal liability under the Federal Clean Water Act as a result of a spill of aviation fuel from a holding tank in October 1996 at a former tank farm operated by Ogden at Dulles International Airport in Washington, D.C. The Department of Justice Attorney offered to resolve this matter by means of a guilty plea to a misdemeanor under the Clean Water Act. Ogden rejected that offer by letter dated December 16, 1999 and is cooperating with the government to seek a fair and reasonable solution. (ii) In October 1990, Ogden Aviation Fueling Company of Virginia, Inc. and Ogden Aviation Services, Inc. were served with a lawsuit entitled "AIRFRANCE, ET. AL. V. OGDEN AVIATION FUELING COMPANY OF VIRGINIA, INC. AND OGDEN AVIATION SERVICES, INC." (Circuit Ct., Fairfax Co., Index No. 183590) in which certain of the airlines seek recovery of cleanup costs arising from a spill of aviation fuel from a holding tank in October 1996 at the former tank farm operated by Ogden at Dulles International Airport for which they reimbursed Ogden. The plaintiffs include United Air Lines, Inc., the largest carrier that operated out of Dulles in 1996, as well as nine other airlines - Air France, America West Airlines, Inc., Austrian Airlines, British Airways PLC, Continental Airlines, Inc., Lufthansa A.G., Northwest Airlines, Inc., United Parcel Service Co., and Virgin Atlantic Airways, Ltd. The suit claims damages in the amount of at least $731,149.76, plus interest. This dollar amount reflects the portion of the spill cleanup paid by the named plaintiffs. The suit alleges damages on two theories: (1) breach of contract in that Ogden was not authorized under the contract to charge the airlines spill related costs; and (2) equitable relief in that Ogden has been unjustly enriched at the expense of the airlines. Ogden Aviation Services, Inc. filed a motion to dismiss the complaint on the grounds that it was never a party to the fuel service agreements. Ogden Aviation Fueling Company of Virginia, Inc. filed a motion to dismiss the unjust enrichment claim and answered the claim arising under the contract. Both motions to dismiss were denied and the litigation will proceed. Ogden takes the position that fuel spill clean up costs were properly charged back to the plaintiff airlines pursuant to the terms of the controlling agreements and will defend its position in this litigation. (iii) Ogden New York Services, Inc. ("Ogden New York"), has resolved all liabilities to the Port Authority of New York and New Jersey associated with Ogden New York's operations at the Bulk and Satellite Tank Farms located at the John F. Kennedy International Airport in New York, New York. Ogden New York has reached an agreement in principle with the Port Authority under which it will make an upfront payment of $1,000,000 with additional payments tied to the extension of the lease totaling $1,200,000 from 1999 through 2008 ($200,000 for first 4 years and $100,000 for remaining 4 years). (iv) On January 4, 2000 and January 21, 2000, United Air Lines, Inc. ("United") and American Airlines, Inc. ("American) named Ogden New York in two separate lawsuits filed in the Supreme Court of the State of New York. The lawsuits seek judgment declaring that Ogden New York is responsible for petroleum contamination at airport terminals formerly or currently leased by United and American. Ogden New York moved to consolidate the two lawsuits on April 27, 2000. II-2 Both United and American allege that Ogden negligently caused discharges of petroleum at the airport and that Ogden is obligated to indemnify the airlines pursuant to the Fuel Services Agreements between Ogden and the respective airline. United and American further allege that Ogden is liable under New York's Navigation Law which imposes liability on persons responsible for discharges of petroleum and under common law theories of indemnity and contribution. The United complaint is asserted against Ogden, American, Delta, Northwest and American Eagle. United is seeking $1,540,000 in technical contractor costs and $432,000 in legal expenses related to the investigation and remediation of contamination at the airport, as well as a declaration that Ogden and the airline defendants are responsible for all or a portion of future costs that United may incur. The American complaint, which is asserted against both Ogden and United, sets forth essentially the same legal basis for liability as the United complaint. American is seeking reimbursement of all or a portion of $4,600,000 allegedly expended in cleanup costs and legal fees it expects to incur to complete an investigation and cleanup that it is conducting under an administrative order with the State Department of Environmental Conservation. The estimate of those sums alleged in the complaint is $70,000,000. Ogden disputes the allegations and believes that the damages sought are excessive in view of the Airlines' responsibility for the contamination under their respective leases and permits with the Port Authority. On May 1, 2000 Ogden filed a motion to dismiss the complaints on the ground that the controlling agreements limit the Airlines' recovery against Ogden to the coverage afforded under Ogden's insurance policies. (v) On December 23, 1999 Allied Services, Inc. was named as a third party defendant in an action filed in the Superior Court of the State of New Jersey. The third-party complaint alleges that Allied generated hazardous substances to a reclamation facility known as the Swope Oil and Chemical Company Site, and that contamination migrated from the Swope Oil Site to the Pennsauken Landfill and surrounding areas. Third-party plaintiffs seek contribution and indemnification from Allied and over 90 other third-party defendants for costs incurred and to be incurred to cleanup the Pennsauken landfill and surrounding areas. As a result of uncertainties regarding the source and scope of contamination, the large number of potentially responsible parties and the varying degrees of responsibility among various classes of potentially responsible parties, the Company's share of liability, if any, cannot be determined at this time. (vi) On January 12, 1998, the Province of Newfoundland filed an Information Against Airconsol Aviation Services Limited ("Airconsol") alleging that Airconsol violated provincial environmental laws in connection with a fuel spill on or about January 14, 1997 at Airconsol's fuel facility at the Deer Lake, Canada Airport. Airconsol contested the allegations and prevailed. The Court voided the Information. The Crown has appealed the Court's decision. The Company will continue to contest its alleged liability on appeal. (vii) The Company and/or certain subsidiaries have been advised by various authorities that they are responsible for investigation, remediation and/or corrective action in connection with fueling operations at various airports. Although the Company and/or its subsidiaries do not II-3 acknowledge any legal obligation to do so, the Company and/or its subsidiaries are cooperating with the government agencies in each matter to seek fair and reasonable solutions. In addition, the cost to the Company and/or its subsidiaries to comply with applicable environmental laws and regulations is generally reimbursed to the Company and/or its subsidiaries through the airlines. (b) Shareholder Litigation On September 22, October 1, and October 12, 1999, complaints (the "Complaints") denominated as class actions (the "Actions") were filed in the United States District Court for the Southern District of New York against the Company, the Company's former Chairman and Chief Executive, R. Richard Ablon, and Robert M. DiGia (incorrectly identified in the Complaints as the Chief Financial Officer and Senior Vice President of the Company). The Complaints, which are largely identical to one another, are brought by alleged shareholders of the Company and purport to assert claims under the federal securities laws. In general, the Complaints allege that the Company and the individual defendants disseminated false and misleading information during the period of March 11, 1999 through September 17, 1999 (the "Class Period") with respect to the Company's intended reorganization plans and its financial condition. The Complaints seek the certification of a class of all purchasers of Ogden Corporation common stock during the Class Period. By order dated December 22, 1999, the Actions have been consolidated for all purposes and lead plaintiffs and lead counsel have been appointed. On February 28, 2000 plaintiffs filed a consolidated amended compliant (the "Amended Compliant"). The Amended Complaint repeats the allegations made in the original complaints and adds new allegations with respect to the timing of the reporting of certain losses experienced by Ogden. In the Amended Complaint, Plaintiffs have added Raymond E. Dombrowski, Jr., Ogden's Senior Vice President and Chief Financial Officer, as a defendant. There has been no discovery in the Actions. While the Actions are at a very early stage, the Company believes it has meritorious defenses to the allegations made in the Complaints and intends to defend the Actions vigorously. On April 28, 2000 all defendants filed motion to dismiss the Actions, with prejudice. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits: 3 ARTICLES OF INCORPORATION AND BY-LAWS. 3.1 Ogden's Restated Certificate of Incorporation as amended.* 3.2 Ogden's By-Laws, as amended through April 8, 1998.* 4 INSTRUMENTS DEFINING RIGHTS OF SECURITY HOLDERS. 4.1 Fiscal Agency Agreement between Ogden and Bankers Trust Company, dated as of June 1, 1987, and Offering Memorandum dated June 12, 1987, relating to U.S. $85 million principal amount of 6% Convertible Subordinated Debentures Due 2002.* II-4 4.2 Fiscal Agency Agreement between Ogden and Bankers Trust Company, dated as of October 15, 1987, and Offering Memorandum dated October 15, 1987 relating to U.S. $75 million principal amount of 5-3/4% Convertible Subordinated Debentures Due 2002.* 4.3 Indenture dated as of March 1, 1992 from Ogden Corporation to The Bank of New York, Trustee, relating to Ogden's $100 million principal amount of 9-1/4% Debentures due 2022.* 10 MATERIAL CONTRACTS 10.1 (a) U.S. $95 million Term Loan and Letter of Credit and Reimbursement Agreement among Ogden, Deutsche Bank AG, New York Branch, and the signatory Banks thereto, dated March 26, 1997.* (b) Credit Agreement by and among Ogden, The Bank of New York, as Agent, and the signatory Lenders thereto dated as of June 30, 1997.* (i) Amendment No. 1 and Waiver No. 1 under Credit Agreement, effective as of August 18, 1999. (ii) Amendment No. 2 to Credit Agreement, effective as of December 20, 1999. (iii) Amendment No. 3 to Credit Agreement, effective as of March 31, 2000. 10.2 Rights Agreement between Ogden Corporation and Manufacturers Hanover Trust Company, dated as of September 20, 1990.* 10.3 Executive Compensation Plans and Agreements. (a) Ogden Corporation 1990 Stock Option Plan Amended and Restated as of January 19, 1994.* (i) Amendment adopted and effective as of September 18, 1997.* (b) Ogden Corporation 1999 Stock Incentive Plan Amended and Restated as of January 1, 2000.* (c) Ogden Services Corporation Select Savings Plan Trust Amendment and Restatement as of January 1, 1995.* II-5 (i) Amendment Number One to the Ogden Services Corporation Select Savings Plan, effective January 1, 1998.* (d) Ogden Corporation Restricted Stock Plan and Restricted Stock Agreement.* (e) Ogden Corporation Restricted Stock Plan for Non-Employee Directors and Restricted Stock Agreement.* (f) Ogden Corporation Core Executive Benefit Program.* (g) Ogden Projects Supplemental Pension and Profit Sharing Plans.* (h) Ogden Projects Core Executive Benefit Program.* (i) Ogden Corporation Executive Performance Incentive Plan.* (j) Ogden Key Management Incentive Plan.* 10.4 Employment Agreements (a) Employment Letter Agreement between Ogden Corporation and Lynde H. Coit, Senior Vice President and General Counsel, dated March 1, 1999.* (b) Employment Agreement between R. Richard Ablon, President, Chairman and C.E.O., and Ogden dated as of January 1, 1998.* (c) Separation Agreement between Ogden and Philip G. Husby, Senior Vice President and C.F.O., dated as of September 17, 1998.* (d) Employment Agreement between Scott G. Mackin, Executive Vice President and Ogden Corporation dated as of October 1, 1998.* (e) Employment Agreement between Ogden Corporation and David L. Hahn, Senior Vice President - Aviation, dated December 1, 1995.* (i) Letter Amendment to Employment Agreement between Ogden Corporation and David L. Hahn, Senior Vice President - Aviation effective as of October 1, 1998.* II-6 (f) Employment Agreement between Ogden Corporation and Rodrigo Arboleda, Senior Vice President dated January 1, 1997.* (i) Letter Amendment to Employment Agreement between Ogden Corporation and Rodrigo Arboleda, Senior Vice President, effective as of October 1, 1998.* (g) Employment Agreement between Ogden Energy Group, Inc. and Bruce W. Stone, dated May 1, 1999.* (h) Employment Agreements between Ogden and Jesus Sainz, Executive Vice President, effective as of January 1, 1998.* (i) Letter Amendment to Employment Agreement between Ogden Corporation and Jesus Sainz, Executive Vice President, effective as of October 1, 1998.* (i) Employment Agreement between Peter Allen, Senior Vice President, and Ogden Corporation dated July 1, 1998.* (j) Employment Agreement between Ogden Corporation and Raymond E. Dombrowski, Jr., Senior Vice President and C.F.O., dated as of September 21, 1998.* 11 Detail of Computation of Earnings Per Share Applicable to Common Stock. 27 Financial Data Schedule (EDGAR Filing Only). o Incorporated by reference as set forth in the Exhibit Index of this Form 10-Q. (b) Reports on Form 8-K A Form 8-K Current Report dated March 29, 2000 was filed on April 3, 2000 and is incorporated herein by reference. II-7 SIGNATURES Pursuant to the requirements of the Securities Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized. OGDEN CORPORATION (Registrant) Date: May 22, 2000 By /s/ RAYMOND E. DOMBROWSKI, JR. --------------------------------- Raymond E. Dombrowski, Jr. Senior Vice President and Chief Financial Officer Date: May 22, 2000 By: /s/ WILLIAM J. METZGER -------------------------------- William J. Metzger Vice President and Chief Accounting Officer II-8
EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION - ----------- ----------------------- ------------------ 3 ARTICLES OF INCORPORATION AND BY-LAWS. 3.1 Ogden's Restated Certificate of Incorporation Filed as Exhibit (3)(a) to Ogden's Form 10-K for as amended. the fiscal year ended December 31, 1988 and incorporated herein by reference. 3.2 Ogden By-Laws as amended. Filed as Exhibit 3.2 to Ogden's Form 10-Q for the quarterly period ended March 31, 1998 and incorporated herein by reference. 4 INSTRUMENTS DEFINING RIGHTS OF SECURITY HOLDERS ----------------------------------------------- 4.1 Fiscal Agency Agreement between Ogden and Filed as Exhibits (C)(3) and (C)(4) to Ogden's Bankers Trust Company, dated as of June 1, 1987 Form 8-K filed with the Securities and Exchange and Offering Memorandum dated June 12, 1987, Commission on July 7, 1987 and incorporated relating to U.S. $85 million principal amount of herein by reference. 6% Convertible Subordinated Debentures Due 2002. 4.2 Fiscal Agency Agreement between Ogden and Filed as Exhibit (4) to Ogden's Form S-3 Bankers Trust Company, dated as of October 15, Registration Statement filed with the Securities 1987, and Offering Memorandum dated October and Exchange Commission on December 4, 1987, 15, 1987, relating to U.S. $75 million Registration No. 33-18875, and incorporated principal amount of 5-3/4% Convertible herein by reference. Subordinated Debentures Due 2002. 4.3 Indenture dated as of March 1, 1992 from Ogden Filed as Exhibit (4)(C) to Ogden's Form 10-K for Corporation to The Bank of New York, Trustee, fiscal year ended December 31, 1991, and relating to Ogden's $100 million principal incorporated herein by reference. amount of 9-1/4% Debentures Due 2022. 10 MATERIAL CONTRACTS 10.1(a) U.S. $95 million Term Loan and Letter of Credit Filed as Exhibit 10.6 to Ogden's Form 10-Q for and Reimbursement Agreement among Ogden, the the quarterly period ended March 31, 1997 and Deutsche Bank AG, New York Branch, and the incorporated herein by reference. signatory Banks thereto, dated March 26, 1997. II-9 EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION - ----------- ----------------------- ------------------ 10.1(b) Credit Agreement among Ogden, The Bank of New Filed as Exhibit 10.1(i) to Ogden's Form 10-Q for York, as Agent, and the signatory Lenders the quarterly period ended June 30, 1997 and thereto, dated as of June 30, 1997. incorporated herein by reference. (i) Amendment No. 1 and Waiver No. 1 under Transmitted herewith as Exhibit 10(b)(i). Credit Agreement, effective as of August 18, 1999. (ii) Amendment No. 2 to Credit Agreement, Transmitted herewith as Exhibit 10(b)(ii). effective as of December 20, 1999. (iii) Amendment No. 3 to Credit Agreement, effective as of March 31, 2000. Transmitted herewith as Exhibit 10(b)(iii). 10.2 Rights Agreement between Ogden Corporation and Filed as Exhibit (10)(h) to Ogden's Form 10-K for Manufacturers Hanover Trust Company, dated as the fiscal year ended December 31, 1990 and of September 20, 1990 and amended August 15, incorporated herein by reference. 1995 to provide The Bank of New York as successor agent. 10.3 EXECUTIVE COMPENSATION PLAN AND AGREEMENTS. (a) (i) Ogden Corporation 1990 Stock Filed as Exhibit 10.6(b)(i) to Ogden's Option Plan Amended and Restated Form 10-Q as for the quarterly period ended as of January 19, 1994. September 30, 1994 and incorporated herein by reference. (ii) Amendment to the Ogden Corporation Filed as Exhibit 10.7(a)(ii) to Ogden's Form 10-K 1990 Stock Option Plan as Amended for fiscal period ended December 31, 1997 and and Restated effective as of incorporated herein by reference. September 18, 1997. (b) Ogden Corporation 1999 Stock Filed as Exhibit 10.3(b)(i) to Ogden's Form 10-K Incentive Plan Amended and for the fiscal year ended December 31, 1999 and Restated as of January 1, 2000. incorporated herein by reference. (c) Ogden Services Corporation Select Filed as Exhibit 10.7 (e) (i) to Ogden's Form Savings Plan Trust Amendment and 10-K for the fiscal year ended December 31, 1994 Restatement as of January 1, 1995. and incorporated herein by reference. II-10 EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION - ----------- ----------------------- ------------------ (i) Amendment Number One to the Filed as Exhibit 10.7 (c)(ii) to Ogden's Form Ogden Services Corporation 10-K for the fiscal year ended December 31, 1997 Select Savings Plan, and incorporated herein by reference. effective January 1, 1998. (d) Ogden Corporation Restricted Stock Filed as Exhibit 10.3(e)(i) to Ogden's Form 10-K Plan and Restricted Stock Agreement. for the fiscal year ended December 31, 1999 and incorporated herein by reference. (e) Ogden Corporation Restricted Stock Filed as Exhibit 10.3 (e)(ii) to Ogden's Form Plan for Non-Employee Directors and 10-K for the fiscal year ended December 31, 1999 Restricted Stock Agreement. and incorporated herein by reference. (f) Ogden Corporation Core Executive Filed as Exhibit 10.8(q) to Ogden's Form 10-K for Benefit Program. fiscal year ended December 31, 1992 and incorporated herein by reference. (g) Ogden Projects Supplemental Pension Filed as Exhibit 10.8(t) to Ogden's Form 10-K for and Profit Sharing Plans. fiscal year ended December 31, 1992 and incorporated herein by reference. (h) Ogden Projects Core Executive Benefit Filed as Exhibit 10.8(v) to Ogden's Form 10-K for Program. fiscal year ended December 31, 1992 and incorporated herein by reference. (i) Ogden Corporation Executive Filed as Exhibit 10.3(m) to Ogden's Form 10-K for Performance Incentive Plan. the fiscal year ended December 31, 1999 and incorporated herein by reference. (j) Ogden Key Management Incentive Filed as Exhibit 10.7(p) to Ogden's Form 10-K for Plan. the fiscal year ended December 31, 1997 and incorporated herein by reference. 10.4 Employment Agreements II-11 EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION - ----------- ----------------------- ------------------ (a) Employment Letter Agreement between Filed as Exhibit 10.4(a) to Ogden's Form 10-K for Ogden Corporation and Lynde H. Coit, the fiscal year ended December 31, 1998 and Senior Vice President and General incorporated herein by reference. Counsel dated March 1, 1999. (b) Employment Agreement between R. Filed as Exhibit 10.3(h) to Ogden's Form 10-Q for Richard Ablon and Ogden dated as of the quarterly period ended June 30, 1998 and January 1, 1998. incorporated herein by reference. (c) Separation Agreement between Ogden Filed as Exhibit 10.8(c) to Ogden's Form 10-Q for Corporation and Philip G. Husby, the quarterly period ended September 30, 1998 and Senior Vice President and C.F.O., incorporated herein by reference. dated as of September 17, 1998. (d) Employment Agreement between Scott G. Filed as Exhibit 10.8(e) to Ogden's Form 10-Q for Mackin, Executive Vice President, and the quarter ended September 30, 1998 and Ogden Corporation dated as of October incorporated herein by reference. 1, 1998. (e) Employment Agreement between Ogden Filed as Exhibit 10.8(i) to Ogden's Form 10-K for Corporation and David L. Hahn, Senior fiscal year ended December 31, 1995 and Vice President - Aviation, dated incorporated herein by reference. December 1, 1995. (i) Letter Amendment to Filed as Exhibit 10.8(f)(i) to Ogden's Form 10-Q Employment Agreement between for the quarterly period ended September 30, 1998 Ogden Corporation and David and incorporated herein by reference. L. Hahn, effective as of October 1, 1998. (f) Employment Agreement between Ogden Filed as Exhibit 10.8(j) to Ogden's Form 10-K for Corporation and Rodrigo Arboleda, fiscal year ended December 31, 1996 and Senior Vice President dated January 1, incorporated herein by reference. 1997. (i) Letter Amendment to Filed as Exhibit 10.8(g)(i) to Ogden's Form 10-Q Employment Agreement between for the quarterly period ended September 30, 1998 Ogden Corporation and Rodrigo and incorporated herein by reference. Arboleda, Senior Vice President, effective as of October 1, 1998. II-12 EXHIBIT NO. DESCRIPTION OF DOCUMENT FILING INFORMATION - ----------- ----------------------- ------------------ (g) Employment Agreement between Ogden Filed as Exhibit 10.4(g) to Ogden's Form 10-K for Energy Group, Inc. and Bruce W. Stone, fiscal year ended December 31, 1999 and dated May 1, 1999. incorporated herein by reference. (h) Employment Agreements between Ogden Filed as Exhibit 10.8(m) to Ogden's Form 10-K for and Jesus Sainz, Executive Vice the fiscal year ended December 31, 1997 and President, effective as of January 1, incorporated herein by reference. 1998. (i) Letter Amendment to Filed as Exhibit 10.8(j)(i) to Ogden's Form 10-Q Employment Agreement between for the quarter ended September 30, 1998 and Ogden Corporation and Jesus incorporated herein by reference. Sainz, Executive Vice President, effective as of October 1, 1998. (i) Employment Agreement between Peter Filed as Exhibit 10.3(M)(1) to Ogden's Form 10-Q Allen, Senior Vice President, and for the quarterly period ended June 30, 1998 and Ogden Corporation dated July 1, 1998. incorporated herein by reference. (j) Employment Agreement between Ogden Filed as Exhibit 10.4(m) to Ogden's Form 10-Q for Corporation and Raymond E. Dombrowski, the quarter ended September 30, 1998 and Jr., Senior Vice President and C.F.O., incorporated herein by reference. dated as of September 21, 1998. 11 Ogden Corporation and Subsidiaries Detail of Transmitted herewith as Exhibit 11. Computation of Earnings Per Share Applicable to Common Stock. 27 Financial Data Schedule. Transmitted herewith as Exhibit 27.
II-13 EX-10.(B)(I) 2 EX-10(B)(I) EXHIBIT 10(b)(i) AMENDMENT NO. 1 AND WAIVER NO. 1 UNDER CREDIT AGREEMENT AMENDMENT NO. 1 AND WAIVER NO. 1 (this "AMENDMENT"), dated as of August 18, 1999, under the Credit Agreement (the "CREDIT AGREEMENT"), dated as of June 30, 1997, by and among OGDEN CORPORATION, a Delaware corporation (the "BORROWER"), the Signatory Lenders party thereto (the "LENDERS") and THE BANK OF NEW YORK, as Agent (the "AGENT"). RECITALS A. Capitalized terms used herein which are not herein defined shall have the respective meanings ascribed thereto in the Credit Agreement. B. The Borrower has entered into an agreement to purchase the equity interest of the PacifiCorp. in a entity that owns a power plant in the Philippines. C. One of the conditions to the closing of such purchase is that the Borrower procure a standby letter of credit in the amount of $31,883,000 (the "Philippines Letter of Credit"). D. The Borrower has requested that the L/C Issuing Bank issue the Philippines Letter of Credit pursuant to the Credit Agreement. E. To facilitate the Borrower's request, the Borrower has requested that the Agent and the Lenders agree to (i) amend the Credit Agreement to increase the Letter of Credit Sub-Facility from $30,000,000 to $33,000,000 and (ii) waive compliance by the Borrower with the notice provisions of Section 2.20(b) of the Credit Agreement for the purposes of the issuance of the Philippines Letter of Credit. F. The Agent and the Lenders are willing to agree to the Borrower's request subject to the terms and conditions set forth herein. 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. Section 2.20(a) of the Credit Agreement is amended by deleting the reference to "$30,000,000" contained in such section and replacing it with "$33,000,000." 2. The Agent and the Lenders waive, for the purpose and only for the purpose of the issuance of the Philippines Letter of Credit, compliance with the provisions of Section 2.20(b) of the Credit Agreement requiring Borrower to provide at least three (3) Business Days notice prior to the requested date of the issuance of a Letter of Credit. 3. The effectiveness of this Amendment and Waiver is subject to the prior or simultaneous fulfillment of the following conditions: (a) The Agent shall have received (i) this Amendment executed by a duly authorized officer or officers of the Borrower and (ii) consents to this Amendment and Waiver from the Required Lenders; and (b) The Agent shall have received such other documents as it shall have reasonably requested. 4. The Borrower hereby (i) reaffirms and admits the validity and enforceability of the Credit Agreement and the other Loan Documents and all of its obligations thereunder, (ii) represents and warrants that there exists no Default or Event of Default, and (iii) represents and warrants that the representations and warranties contained in the Credit Agreement as amended by this Amendment (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. 5. This Amendment and Waiver may be executed in any number of counterparts, 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. 6. This Amendment and Waiver 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. 7. Except as amended hereby, the Credit Agreement shall in all other respects remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Amendment and Waiver to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written. -2- EX-10.(B)(II) 3 EX-10(B)(II) EXHIBIT 10(b)(ii) AMENDMENT NO. 2 TO CREDIT AGREEMENT AMENDMENT NO. 2 (this "AMENDMENT"), dated as of December 20, 1999, under the Credit Agreement dated as of June 30, 1997, by and among OGDEN CORPORATION, a Delaware corporation (the "COMPANY"), the Signatory Lenders party thereto (the "LENDERS") and THE BANK OF NEW YORK, as Agent (the "AGENT") as amended by Amendment No. 1 to Credit Agreement, dated as of August 18, 1999 (the "CREDIT AGREEMENT). RECITALS I. Capitalized terms used herein which are not herein defined shall have the respective meanings ascribed thereto in the Credit Agreement. II. The Company has advised the Agent that: (a) It has decided to sell certain businesses and/or assets. (b) It will classify, for accounting purposes, the businesses described in Schedule 1 annexed hereto as "discontinued operations" ("1999 DISCONTINUED OPERATIONS"). (c) It anticipates that it will incur losses in the amounts specified in Schedule 2 annexed hereto under the heading "Anticipated Write-Offs" (the "1999 WRITE-OFFS") in connection with the sales and other events described in Schedule 2. (d) It anticipates it will be required to incur additional indebtedness to finance the completion of construction of the Jazzland project, to fund incremental interest expense of Ogden Energy and with respect to bridge loans and purchase money loans, to fund expenses with respect to its insurance programs and for general working capital purposes (the "1999 ADDITIONAL INDEBTEDNESS"). III. The Company has also advised the Agent that the consummation of the transactions and the occurrence of the events described in Recitals II (a), (b) and (c) and the incurrence of the Indebtedness described in Recital II (d) may result in the violation by the Company of one or more covenants of the Credit Agreement. IV. To facilitate the consummation of the transactions described in Recitals II (a), (b) and (c) and to permit the Company to incur the indebtedness described in Recital II (d), the Company has requested the Agent and the Lenders agree to amend the Credit Agreement. V. The Agent and the Lenders have advised the Company that they are willing to agree to the Borrower's request subject to the terms and conditions set forth herein. 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 TO CREDIT AGREEMENT 1.1 Section 1.1 of the Credit Agreement is amended to add the following defined terms in the appropriate alphabetical order: "AMENDMENT NO. 2" means Amendment No. 2 to Credit Agreement, dated as of December 17, 1999, among the Company, the Lenders party thereto and the Agent. "AMENDMENT NO. 2 EFFECTIVE DATE" means the date on which the conditions set forth in Section 2.1 of Amendment No. 2 are satisfied. "1999 ADDITIONAL INDEBTEDNESS" has the meaning ascribed to it in Recital II (d) of Amendment No. 2 to Credit Agreement. "1999 DISCONTINUED OPERATIONS": has the meaning ascribed to it in Recital II (b) of Amendment No. 2 to Credit Agreement. "1999 WRITE-OFFS": has the meaning ascribed to it in Recital II (c) of Amendment No. 2 to Credit Agreement. 1.2 Section 1.1 of the Credit Agreement is amended by deleting in its entirety the text of the defined term "OPERATING INCOME" and substituting therefor the following: "OPERATING INCOME" net income before income taxes and minority interests of the Company and its Subsidiaries from continuing operations and, for the purpose and only for the purpose of testing and determining compliance with Section 8.9 of this Agreement (a) including income from the 1999 Discontinued Operations, (b) excluding actual gains and losses resulting from the disposition of Property made pursuant to Section 8.6(iv), (c) excluding amounts not to exceed (1) for each 1999 Write-Off Event, the corresponding amount, pre-tax, set forth in the second column of Schedule 2 to Amendment No. 2 to the Credit Agreement, (2) $100,000,000 in the aggregate for all 1999 Write-Offs Events and (d) write-offs associated with the Richard Ablon litigation not to exceed $23,000,000 in the aggregate. 1.1 Section 1.1 of the Credit Agreement is amended by deleting in its entirety the text of the defined term "SHAREHOLDERS' EQUITY" and substituting therefor the following: "SHAREHOLDERS' EQUITY" all amounts which would, in conformity with GAAP, be included under shareholders' equity on a Consolidated balance sheet, PLUS, for the purpose and only for the purpose of determining and testing compliance with Section 8.5 of this Agreement, actual losses when incurred (according to GAAP) in respect of the 1999 Write-Offs, not to exceed (a) for each 1999 Write-Off Event, the corresponding amount, after-tax, set forth in the third column of Schedule 2 to Amendment No. 2 to Credit Agreement and (b) $70,000,000 after-tax, in the aggregate for all 1999 Write-Offs. 1.4 The Credit Agreement is amended to add the following Section 2.24: "2.24 AVAILABILITY OF COMMITMENTS. (a) The Company agrees that, notwithstanding any other provision of this Agreement, during the period from the Amendment No. 2 Effective Date to and including the date on which the Required Lenders, in their sole discretion, agree to reinstate the availability of the Revolving Commitments and the Letter of Credit Commitments (the "Availability Reinstatement Date") (a) the Company shall not be entitled to request and the Lenders shall not be obligated to make any additional Loans and (b) the Company shall not be entitled to request and the Issuing Bank shall not be required to issue any additional Letters of Credit. (b) The Company and the Lenders agree that the limitation on the availability of the Revolving Commitments and the Letter of Credit Commitments set forth in Section 2.24(a) is not a termination or reduction of such Commitments." 1.5 Section 8.4 of the Credit Agreement is amended to delete the words "Sale of Property" from the heading of such section. 1.6 Section 8.5 of the Credit Agreement is amended to delete the text thereof in its entirety and to substitute the following therefor: "8.5 LEVERAGE RATIO Permit its ratio of the sum of (i) Consolidated Indebtedness plus (ii) Consolidated Contingent Obligations to the sum of (x) Consolidated Indebtedness plus (y) Consolidated Contingent Obligations plus (z) the Company's Shareholders' Equity to be greater than 0.650:1.0 at any time." 1.6 Section 8.6 of the Credit Agreement is amended to delete the text thereof in its entirety and to substitute therefor the following: "8.6 SALE OF PROPERTY Sell, assign, exchange, lease, transfer or otherwise dispose of any Property, whether now owned or hereafter acquired, to any Person, or permit any Subsidiary so to do, except: (i) dispositions to a Subsidiary for a consideration at least equal to the fair value of the Property disposed of; (ii) dispositions by one Subsidiary to the Company or to another Subsidiary; (iii) (intentionally deleted); (iv) dispositions of Property that result in proceeds (irrespective of whether such proceeds are paid in cash or any other form) to the Company (or other Person that is the seller of the Property) of not more than $35,000,000 after payment of (1) any required closing costs and expenses directly attributable to the sale of the Property ("Closing Costs") and (2) any Indebtedness that is secured by the Property that is being sold ("Sale Related Debt"), PROVIDED THAT, prior to the consummation of any such sale, the Company shall have furnished the Agent a copy of the agreement or contract for the sale for the applicable Property and a statement setting forth, on a PRO FORMA basis, the total consideration to be paid to the Company (or other seller) under the agreement or contract for the sale for such Property and the estimated amount, if any, of the Closing Costs and Sale Related Debt to be paid from the consideration for the sale and the net proceeds of sale to be realized (by the Company or other seller) from the sale after the deduction or payment of the Closing Costs and Sale Related Debt (each a "Pro-Forma Sale Statement"), and PROVIDED FURTHER that after the consummation of such sale, the Company shall deliver to the Agent a statement indicating any variance between the Pro Forma Sale Statement and the actual amount received and paid in connection with such sale; (v) the payment of dividends and distribution of Stock of the Company in the ordinary course of business; (vi) (intentionally deleted)." 1.6 Section 8.9 of the Credit Agreement is amended to delete the text thereof in its entirety and to substitute the following therefor: "8.9 FIXED CHARGE COVERAGE RATIO Permit the Fixed Charge Coverage Ratio to be less than (a) 1.25 to 1.00 for the four fiscal quarters (taken as a whole) preceding December 31, 1999 and (b) thereafter, 1.50 to 1.00 for any preceding period of four fiscal quarters (taken as a whole). 2. CONDITIONS TO EFFECTIVENESS OF AMENDMENT. 2.1 The effectiveness of this Amendment is subject to the prior or simultaneous fulfillment of the following conditions: (a) The Agent shall have received this Amendment executed by (i) a duly authorized officer or officers of the Borrower and (ii) the Required Lenders; (b) The Agent shall have received such other documents as it shall have reasonably requested; (c) The Agent shall have received payment of all of its out-of-pocket expenses, including the reasonable fees and expenses of its counsel incurred pursuant to the Credit Agreement through October 31, 1999 in the amount of $18,375.00, plus any additional fees and expenses of counsel incurred from November 1, 1999 and incurred in connection with this Amendment; and (d) The Agent shall have received the fees due to the Agent and the Lenders pursuant to the letter agreements between the Agent and the Borrower. 2.2 The date on which the conditions set forth in Section 2.1 are satisfied is the "AMENDMENT NO. 2 EFFECTIVE DATE." 3. ACKNOWLEDGMENTS AND REPRESENTATIONS AND WARRANTIES. 3.1 The Borrower hereby (a) reaffirms and admits the validity and enforceability of the Credit Agreement and the other Loan Documents and all of its obligations thereunder, (b) represents and warrants that there exists no Default or Event of Default, and (c) represents and warrants that the representations and warranties contained in the Credit Agreement as amended by this Amendment (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. 4. MISCELLANEOUS 4.1 This Amendment may be executed by facsimile and in any number of counterparts, 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. 4.2 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. 4.3 Except as amended hereby, the Credit Agreement shall in all other respects remain in full force and effect. [THE REMAINDER OF THE PAGE HAS BEEN INTENTIONALLY LEFT BLANK] 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. EX-10.(B)(III) 4 EX-10(B)(III) EXHIBIT 10(b)(iii) AMENDMENT NO. 3 TO CREDIT AGREEMENT AMENDMENT NO. 3 (this "AMENDMENT NO. 3"), dated as of March 31, 2000, under the Credit Agreement dated as of June 30, 1997, by and among OGDEN CORPORATION, a Delaware corporation (the "COMPANY"), the Signatory Lenders party thereto (the "LENDERS") and THE BANK OF NEW YORK, as Agent (the "AGENT"), as amended by Amendment No. 1 to Credit Agreement, dated as of August 18, 1999, and Amendment No. 2 to Credit Agreement, dated as of December 20, 1999 (the "CREDIT AGREEMENT"). RECITALS I. Capitalized terms used herein which are not herein defined shall have the respective meanings ascribed thereto in the Credit Agreement. II. The Company has requested that the Agent and the Lenders (a) reduce the Aggregate Commitments from $200,000,000 to $100,000,000, (b) amend the Credit Agreement to create a secured revolving credit subfacility and (c) amend the Credit Agreement in certain other respects. III. The Agent and the Lenders have advised the Company that they are willing to agree to the Company's request subject to the terms and conditions set forth herein. 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 TO CREDIT AGREEMENT -- GENERAL. 1.1 Section 1.1 of the Credit Agreement is hereby amended by adding the following defined terms in the appropriate alphabetical order: "AMENDMENT NO. 3": Amendment No. 3 to Credit Agreement, dated as of March 31, 2000, among the Company, the Lenders party thereto and the Agent. "AMENDMENT NO. 3 EFFECTIVE DATE": the date on which the conditions set forth in Section 3.1 of Amendment No. 3 are satisfied. "CAPITAL EXPENDITURES": for any period, the sum of the aggregate of all expenditures (paid in cash or for which the Company or any Subsidiary is obligated as a result of the acquisition by the Company or such Subsidiary of any fixed or capital asset during such period or the rendition of services to the Company or such Subsidiary in respect of any fixed or capital asset) by the Company and the Subsidiaries on a Consolidated basis during such period for fixed or capital assets (excluding any capitalized interest and any such asset acquired in connection with normal replacement and maintenance programs properly charged to current operations and excluding any replacement assets acquired with the proceeds of insurance). "COVENANT CREDIT FACILITIES": any loan agreement, loan document, agreement or indenture that contains covenants (however designated, and including negative, affirmative or financial covenants) which (a) require the maintenance of minimum Shareholder's Equity (b) prescribe a Fixed Charge Coverage Ratio, (c) prohibit or restrict the sale, assignment, transfer or disposition of any Property of the Company or any Subsidiary or (d) restrict the granting of the Lien granted in favor of the Agent pursuant to paragraph 2.27 or require equivalent security over any Property or assets of the Company or any Subsidiary, and which loan agreements, loan documents, agreements and indentures are described on Schedule D to Amendment No. 3. "CREDIT FACILITY INDEBTEDNESS": the Indebtedness of the Company and its Subsidiaries described on Schedule C to Amendment No. 3 together with any Hedging Agreement entered into in connection therewith. "DISBURSEMENT ACCOUNT": the disbursement account maintained by the Company at BNY in accordance with paragraph 2.25. "DISPOSITION CLOSING COSTS": any required closing fees, costs and expenses directly attributable to a Permitted Disposition. "DISPOSITION RELATED DEBT": the debt that is secured by or related to the Property sold in a Permitted Disposition as set forth on Schedule E to Amendment No. 3. "GUARANTEE": of or by any Person (the "GUARANTOR") means any obligation, contingent or otherwise, of the guarantor guaranteeing or in effect guaranteeing any return on any investment made by another Person, or any Indebtedness, lease, dividend or other obligation (a "PRIMARY OBLIGATION") of any other Person (a "PRIMARY OBLIGOR") in any manner, whether directly or indirectly, including any obligation of the guarantor, directly or indirectly (i) to purchase any primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (A) for the purchase or payment of any primary obligation or (B) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of a primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the beneficiary of any primary obligation of the ability of a primary obligor to make payment of a primary obligation, (iv) otherwise to assure or hold harmless the beneficiary of a primary obligation against loss in respect thereof and (v) in respect of the liabilities of any partnership in which a secondary obligor is a general partner, except to the extent that such liabilities of such partnership are nonrecourse to such secondary obligor and its separate property, provided, however, that the term "Guarantee" shall not include (x) the endorsement of instruments for deposit or collection in the ordinary course of business or (y) the indemnification provisions 2 contained in the purchase agreements with respect to the Property described on Schedules B-1, B-2 and B-3 to Amendment No. 3. The amount of any Guarantee shall be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guarantor in good faith. "HEDGING AGREEMENT": any interest rate swap, cap or collar arrangement or any other derivative product customarily offered by banks or other financial institutions to their customers in order to reduce the exposure of such customers to interest rate fluctuations. "NET CASH PROCEEDS": cash proceeds received from a sale, assignment, transfer or other disposition of Property minus (a) taxes paid or payable in cash in connection therewith at the time such sale, assignment, transfer or other disposition is consummated, (b) Disposition Closing Costs and (c) Disposition Related Debt. "PERMITTED DISPOSITION": as defined in paragraph 8.6(iv). "PROCEEDS DISBURSEMENT REQUEST": a notice of the Company in the form of Exhibit B to Amendment No. 3, specifying (i) the aggregate amount of Net Cash Proceeds requested to be disbursed from the Disbursement Account, (ii) the requested disbursement date and (iii) the intended use of such Net Cash Proceeds and certifying, representing and warranting that (x) no Default or Event of Default has occurred and is continuing and (y) such Net Cash Proceeds shall be used in accordance with and for the purposes and in the categories and in the amounts set forth in the Projections except as otherwise permitted by paragraph 8.14 of this Agreement. "PROJECTIONS": the projections of the Company dated March 16, 2000 (Revised) delivered to the Agent and the Lenders in the form of Schedule A to Amendment No. 3. "RESERVE ACCOUNT": the blocked reserve account maintained by the Company at BNY under the dominion and control of the Agent. "RESTRUCTURING COSTS": the fees and expenses (including reasonable attorneys' and accountants' fees and expenses) (i) payable by the Company or any Subsidiary in connection with (x) the execution and delivery of Amendment No. 3 (including, without limitation, fees and expenses in connection with the grant by the Company and certain of its Subsidiaries of Liens in favor of the Agent on certain of their property), (y) the amendments to or waivers of the Covenant Credit Facilities contemplated by, and executed and delivered contemporaneously with, Amendment No. 3 and (z) the extension of maturity dates of Indebtedness and expiry dates of letters of credit which mature or expire, as the case may be, prior to the Liquidity Subfacility Termination Date to a date that is not earlier than the Liquidity Subfacility Termination Date, and (ii) incurred by the Company in an amount of up to $5,000,000 in connection with the issuance by the Company of any Stock after the 3 Amendment No. 3 Effective Date, in each case accrued or capitalized as a cost of issuance in accordance with GAAP. "SALES LOSSES": losses incurred by the Company or any Subsidiary in connection with any Permitted Disposition determined in accordance with GAAP. "SPRINGING CREDIT EVENT": any event or any event that with the giving of notice of the passage of time or both results in a Springing Credit Obligation. "SPRINGING CREDIT OBLIGATION": any agreement or obligation of the Company or any Subsidiary under any loan document, indenture, or other agreement to provide a letter of credit or other credit support. "STEERING COMMITTEE": the informal committee of creditors of the Company and/or its Subsidiaries composed of the Agent and other creditors of the Company represented by O'Melveny & Myers LLP as of the Amendment No. 3 Effective Date. 1.2 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Aggregate Commitments" in its entirety and substituting the following therefor: "AGGREGATE COMMITMENTS": the sum of the Commitments set forth in Exhibit A to Amendment No. 3 (which as of the Amendment No. 3 Effective Date equals $100,000,000), as the same may be reduced pursuant to paragraph 2.5 (Reduction of Commitments) or 2.18 (Extension of Termination Date). 1.3 Section 1.1 of the Credit agreement is hereby amended by deleting the definition of "Commitment" in its entirety and substituting the following therefor: "COMMITMENT": as to any Lender, the amount set forth next to the name of such Lender in Exhibit A to Amendment No. 3 under the heading "Commitment," as such Commitment may be reduced pursuant to paragraphs 2.5 or 11.7(b). 1.4 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Commitment Percentage" in its entirety and substituting the following therefor: "COMMITMENT PERCENTAGE": as to any Lender, the percentage that the Commitment of such Lender bears to the Aggregate Commitments, as set forth opposite the name of such Lender in Exhibit A to Amendment No. 3 under the heading "Commitment Percentage", as such percentage may be reallocated pursuant to paragraph 2.18 (whereupon such percentage shall become such Lender's Reallocated Commitment Percentage, as such term is 4 hereinafter defined) or decreased upon an assignment permitted under paragraph 11.7(b). 1.5 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Eligible Assignee" in its entirety and substituting the following therefor: "ELIGIBLE ASSIGNEE": an assignee which is a commercial bank, an insurance company, a finance company, a financial institution, any fund that invests in loans or any other "accredited investor" (as defined in Regulation D promulgated under the Securities Act of 1933, as amended), but in any event excluding the Company and its Subsidiaries and Affiliates. 1.6 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Fixed Charge Coverage Ratio" in its entirety and substituting the following therefor: "FIXED CHARGE COVERAGE RATIO": the ratio of (i) the sum of Operating Income, Interest Expense, Rent Expense, and, to the extent deducted from the determination of Operating Income in accordance with GAAP, Restructuring Costs and Sales Losses, if any, to (ii) the sum of Interest Expense and Rent Expense, all on a Consolidated basis. 1.7 Section 2.24 of the Credit Agreement is hereby deleted in its entirety and the following substituted therefor: Section 2.24 REDUCTION OF COMMITMENTS; AVAILABILITY OF COMMITMENTS AND PRICING OPTIONS. The Company agrees that, notwithstanding any other provision of this Agreement, (x) on the Amendment No. 3 Effective Date, the Aggregate Commitments shall be permanently reduced from $200,000,000 to $100,000,000 and the Commitment of each Lender shall be reduced pro rata as set forth on Exhibit A to Amendment No. 3, and (y) during the period from the Amendment No. 3 Effective Date to and including the date on which the Required Lenders, in their sole discretion, agree to reinstate the ability of the Company to borrow Loans under the Commitments (as reduced hereby) and request the issuance of Letters of Credit and to reinstate the availability of Competitive Bid Loan and CD Loans: (i) the Company shall not be entitled to request and the Lenders shall not be obligated to make any additional Loans, except Liquidity Loans; 5 (ii) the Company shall not be entitled to request and the Issuing Bank shall not be required to issue any additional Letters of Credit; (iii) the Company shall be entitled to elect Interest Periods of only 30 days for Eurodollar Loans; (iv) the Company may not and shall not request any Competitive Bid Borrowings; and (v) the Company may not and shall not request any CD Loan and may not and shall not request that any Loan be converted to a CD Loan. 1.8 Section 2 of the Credit Agreement is hereby amended by adding a new Section 2.25 to read as follows: 2.25. DISBURSEMENT ACCOUNT, RESERVE ACCOUNT AND COLLATERAL FOR SUBFACILITY. (a) SECURITY INTERESTS - DISBURSEMENTS ACCOUNT AND RESERVE ACCOUNT. The Company acknowledges and agrees that, pursuant to the Security Documents, the Disbursement Account and the Reserve Account and the Net Cash Proceeds from time to time deposited in or credited to the Disbursement Account and the Reserve Account and all interest and earnings thereon secure the Subfacility Obligations. (b) SET-OFF - DISBURSEMENT ACCOUNT AND RESERVE ACCOUNT. The Company acknowledges that the Net Cash Proceeds from time to time deposited and held in the Disbursement Account or in the Reserve Account shall, in addition to the rights of the Agent therein pursuant to the Security Documents, be subject to the Agent's right of setoff (which may be exercised upon the occurrence of an Event of Default which is continuing) up to an amount not to exceed the aggregate amount of Indebtedness and obligations of the Company outstanding from time to time under this Agreement, including, without limitation, Indebtedness and obligations of the Company under the Liquidity Subfacility; provided that any amounts set off by the Agent after the occurrence of an Event of Default or otherwise in excess of the aggregate amount of 6 Indebtedness and obligations of the Company under the Liquidity Subfacility shall be held by the Agent to be applied for the benefit of all holders of Credit Facility Indebtedness on terms and conditions to be agreed to by the Agent, the Required Lenders and the requisite creditors under the Credit Facility Indebtedness (or, if such agreement is not reached, in accordance with the order of a court of competent jurisdiction). (c) RELEASE OF NET CASH PROCEEDS FROM DISBURSEMENT ACCOUNT. The Company may from time to time but not more frequently than once each calendar week request that the Agent release Net Cash Proceeds from the Disbursement Account by delivering to the Agent a Proceeds Disbursement Request not later than 11:00 A.M., New York City time, one (1) Business Day prior to the requested disbursement date (the "DISBURSEMENT DATE"). Provided that the Agent shall have received a Proceeds Disbursement Request in accordance with the terms hereof, the Agent, not later than 11:00 A.M., New York City time on the Disbursement Date, shall release the Net Cash Proceeds covered by such Proceeds Disbursement Request to the Company. (d) DISPOSITION OF NET CASH PROCEEDS - DISBURSEMENT ACCOUNT AND RESERVE ACCOUNT. Except for (i) the right of the Company to request the release of Net Cash Proceeds from the Disbursement Account pursuant to paragraph 2.25(c) hereof, (ii) the rights of the Agent, for the ratable benefit of the Lenders, as secured party and (iii) the right of set-off of the Agent (as limited by paragraph 2.25(b)), (A) none of the Company, any Subsidiary, any Lender, or the holder of Indebtedness of the Company or any Subsidiary shall have any right to request the release or disbursement of any funds in the Disbursement Account or the Reserve Account and (B) any and all funds deposited in the Disbursement Account and Reserve Account (other than the funds deposited in the Reserve Account, which shall secure, and may be applied in satisfaction of, the obligations of the Company and the Subsidiary Guarantors in respect of the Liquidity Subfacility in accordance with the terms of this Agreement and the Security Documents) shall be held in such accounts pending the execution of an agreement among the Company, the Agent, the Required Lenders and the requisite creditors under the Credit Facility Indebtedness (or, if such 7 agreement is not reached, the order of a court of competent jurisdiction). (e) SUBSTITUTION AND RELEASE OF COLLATERAL. The Agent and the Lenders agree that provided no Default or Event of Default has occurred and is continuing, the Agent and the Lenders promptly will: (i) release their security interest in the Collateral (including the Disbursement Account but not the Reserve Account) upon the written request of the Company after Ogden Services Corporation shall have deposited Net Cash Proceeds received by Ogden Services Corporation from the sale of the "food and beverage" business or another business sold by Ogden Services Corporation permitted to be sold hereunder of not less than $51,000,000 in the Reserve Account as substitute collateral for the Collateral; and (ii) release their security interest in the Collateral (including the Disbursement Account and the Reserve Account) upon (A) the repayment in full of the Liquidity Loans and all accrued interest thereon and the termination of the Liquidity Subfacility, (B) the cancellation of the Liquidity Subfacility by the Company at any time that no Liquidity Loans are outstanding or (C) receipt by the Agent of Net Cash Proceeds from the sale of the Aviation Business and the simultaneous repayment in full of the Liquidity Loans and all accrued interest thereon and termination of the Liquidity Subfacility, which release shall be simultaneous with such sale and the receipt of such Net Cash Proceeds and repayment. The Agent and the Lenders shall execute and deliver to the Company such instruments and documents as the Company may reasonably request to evidence such release, at the sole cost and expense of the Company. (f) DUTIES OF THE AGENT WITH RESPECT TO DISBURSEMENT ACCOUNT AND RESERVE ACCOUNT. (i) The duties, responsibilities and obligations of the Agent with respect to the Disbursement Account and the Reserve Account shall be limited to those expressly set forth herein and no duties, responsibilities or obligations shall be inferred or implied. The Agent shall not be subject to, nor required to comply with, any other agreement to which the Company is a party, even though reference thereto may be made herein, or to comply with any direction or instruction (other than those contained herein or delivered 8 in accordance with this Agreement) from the Company or any entity acting on its behalf. The Agent shall not be required to, and shall not, expend or risk any of its own funds or otherwise incur any financial liability in the performance of any of its duties as Agent under this paragraph 2.25. (ii) If at any time the Agent is served with any judicial or administrative order, judgment, decree, writ or other form of judicial or administrative process which in any way affects the Disbursement Account or the Reserve Account (including but not limited to orders of attachment or garnishment or other forms of levies or injunctions or stays relating to the transfer of the Disbursement Account or the Reserve Account), the Agent is authorized to comply therewith in any manner as it or its legal counsel of its own choosing deems appropriate; and if the Agent complies with any such judicial or administrative order, judgment, decree, writ or other form of judicial or administrative process, the Agent shall not be liable to any of the parties hereto or to any other person or entity even though such order, judgment, decree, writ or process may be subsequently modified or vacated or otherwise determined to have been without legal force or effect. (iii) The Agent shall not be liable for any action taken or omitted or for any loss or injury resulting from its actions or its performance or lack of performance of its duties under this paragraph 2.25 in the absence of gross negligence or willful misconduct on its part. In no event shall the Agent be liable (i) for acting in accordance with or relying upon any instruction, notice, demand, certificate or document from the Company or any entity acting on behalf of the Company, (ii) for any consequential, punitive or special damages, (iii) for the acts or omissions of its nominees, correspondents, designees, subagents or subcustodians, or (iv) for an amount in excess of the amount then deposited in or credited to the Disbursement Account or the Reserve Account. (iv) If any fees, expenses or costs incurred by, or any obligations owed to, the Agent under this paragraph 2.25 are not promptly paid when due, the Agent may reimburse itself therefor from the Disbursement Account or the Reserve Account and may sell, convey or otherwise dispose of any amounts or property deposited in or credited to such accounts for such purpose. (v) The Agent may consult with legal counsel and the accounting firm retained by the Steering Committee at 9 the reasonable expense of the Company as to any matter relating to the administration of the Disbursement Account or the Reserve Account, and the Agent shall not incur any liability in acting in good faith in accordance with any advice from such counsel or accounting firm. (vi) The Agent shall not incur any liability for not performing any act or fulfilling any duty, obligation or responsibility under this paragraph 2.25 by reason of any occurrence beyond the control of the Agent (including but not limited to any act or provision of any present or future law or regulation or governmental authority, any act of God or war, or the unavailability of the Federal Reserve Bank wire or telex or other wire or communication facility). (vii) The Agent shall not be responsible in any respect for the form, execution, validity, value or genuineness of documents or securities deposited hereunder, or for any description therein, or for the identity, authority or rights of persons executing or delivering or purporting to execute or deliver any such document, security or endorsement. (viii) The Company shall be liable for and shall reimburse and indemnify the Agent and hold the Agent harmless from and against any and all claims, losses, liabilities, costs, damages or expenses (including reasonable attorneys' and accountants' fees and expenses) (collectively, "LOSSES") arising from or in connection with or related to the Disbursement Account or the Reserve Account or with respect to the Agent's custody and administration of the Disbursement Account and the Reserve Account (including but not limited to Losses incurred by the Agent in connection with its successful defense, in whole or in part, of any claim of gross negligence or willful misconduct on its part), provided, however, that nothing contained herein shall require the Agent to be indemnified for Losses caused by its gross negligence or willful misconduct. (ix) In the event of any ambiguity or uncertainty in any notice, instruction or other communication received by the Agent hereunder, the Agent may, in its sole discretion, refrain from taking any action other than retain possession of the Disbursement Account and the Reserve Account. (x) In the event of any dispute between or conflicting claims by the Company and/or any other person or entity with respect to the Disbursement Account or the Reserve Account, the Agent shall be entitled, in its sole discretion, to refuse to comply with any and all claims, demands or instructions with respect to the 10 Disbursement Account or the Reserve Account so long as such dispute or conflict shall continue, and the Agent shall not be or become liable in any way to the Company for failure or refusal to comply with such conflicting claims, demands or instructions. The Agent shall be entitled to refuse to act until, in its sole discretion, either (1) such conflicting or adverse claims or demands shall have been determined by a final order, judgment or decree of a court of competent jurisdiction, which order, judgment or decree is not subject to appeal, or settled by agreement between the conflicting parties as evidenced in a writing satisfactory to the Agent or (2) the Agent shall have received security or an indemnity satisfactory to it sufficient to hold it harmless from and against any and all Losses which it may incur by reason of so acting. The Agent may, in addition, elect, in its sole discretion, to commence an interpleader action or seek other judicial relief or orders as it may deem, in its sole discretion, necessary. The costs and expenses (including reasonable attorneys' fees and expenses) incurred in connection with such proceeding shall be paid by the Company. 1.9 Section 3.1 of the Credit Agreement is hereby amended by (i) adding to the heading thereof the phrase "; OTHER FEES.", (ii) renumbering the existing paragraph as Section 3.1(a) and (iii) adding a new Section 3.1(b) at the end thereof to read in its entirety as follows: (b) The Company agrees to pay to the Agent for the pro rata account of each Lender a fee in the amount of $500,000, payable on the earlier to occur of (i) the date on which the Company and its Subsidiaries shall have received gross proceeds in an aggregate amount of $500,000,000 from all sales, assignments, transfers or other dispositions of PROPERTY after the Amendment No. 3 Effective Date in accordance with the terms hereof and (ii) the date on which the Loans and all other obligations under this Agreement (including, without limitation, all interest, fees and expenses payable to the Agent or the Lenders hereunder) shall have been paid and performed in full and the Commitments terminated. 1.10 Section 7.2 of the Credit Agreement is hereby amended by adding a new Section 7.2(g) thereto to read in its entirety as follows: (g)(i) As soon as available, but in any event not later than Wednesday of each week, weekly updates of the monthly cash flow statements of the Company and its Subsidiaries in a format consistent with past practice. (ii) Conduct weekly meetings and conference calls with the Agent, the Lenders under this Agreement and the Steering Committee 11 to discuss and review such matters as the Agent and the Steering Committee deems appropriate, including, without limitation, reports with respect to, and explanations of, any material variances between the Projections and the Company's and its Subsidiaries' actual results of operations. (iii) As soon as available, deliver to the Agent notice of any Springing Credit Event and any demand under a Springing Credit Obligation. 1.11 Section 7.11 of the Credit Agreement is hereby deleted in its entirety and the following substituted therefor: 7.11 SHAREHOLDERS' EQUITY. Maintain at all times for each period set forth below its Shareholders' Equity in an amount not less than the amount set forth below opposite such period: PERIOD MINIMUM SHAREHOLDERS' EQUITY Effective Date to and including December 31, 1999 $440,000,000 January 1, 2000 to and including July 31, 2000 $400,000,000 August 1, 2000 and thereafter $440,000,000 1.12 Section 7 of the Credit Agreement is hereby amended by adding a new Section 7.12 to read in its entirety as follows: 7.12 CERTAIN AMENDMENTS. Use its best efforts to extend the maturity date or expiry date of any Indebtedness or Credit Facility Indebtedness which matures or expires, as the case may be, prior to the Liquidity Subfacility Termination Date (other than with respect to the periodic renewal of the Credit Facility Indebtedness described in items 9 through 12 on Schedule C to Amendment No. 3) to a date that is not earlier than the Liquidity Subfacility Termination Date. 12 1.13 Section 8.1 of the Credit Agreement is hereby deleted in its entirety and the following substituted therefor: 8.1 INDEBTEDNESS. Create, incur, assume or suffer to exist, or permit any Subsidiary to create, incur, assume or suffer to exist, any liability for Indebtedness, except: (i) Indebtedness under the Loan Documents; and (ii) Credit Facility Indebtedness (including any Credit Facility Indebtedness incurred under commitments available on the Amendment No. 3 Effective Date provided that the proceeds of such Credit Facility Indebtedness are not applied to repay the principal amount of any other Indebtedness), any Indebtedness of the Company or any Subsidiary outstanding as of the Amendment No. 3 Effective Date, any Indebtedness representing capitalized interest on any Credit Facility Indebtedness and any extensions, renewals and replacements of any such Indebtedness or Credit Facility Indebtedness that do not increase the outstanding principal amount thereof (other than as a result of the capitalization of interest). 1.14 Section 8.2 of the Credit Agreement is hereby deleted in its entirety and the following substituted therefor: 8.2 LIENS. Create, incur, assume or suffer to exist any Lien on any of its or its Subsidiaries' Property or assets, whether now owned or hereafter acquired, securing any Indebtedness or obligation, or permit any Subsidiary to do so, except (i) Permitted Liens (other than of the type described in subparagraph (ix) of the definition of "Permitted Liens"), (ii) Liens granted pursuant to the Security Documents, (iii) Liens existing on the Amendment No. 3 Effective Date that were permitted under this Agreement or under any other Covenant Credit Facilities and (iv) equal and ratable Liens permitted by paragraph 8.15. 1.15 Section 8.4 of the Credit Agreement is hereby amended by (i) deleting the semi-colon and the word "and" at the end of clause (iii) thereof and substituting therefor a period and (ii) deleting clause (iv) thereof in its entirety. 1.16 Section 8.6 of the Credit Agreement is hereby deleted in its entirety and the following substituted therefor: 13 8.6 SALE OF PROPERTY. Sell, assign, exchange, lease, transfer or otherwise dispose of any Property, whether now owned or hereafter acquired, to any Person, or permit any Subsidiary so to do, except: (i) the use of cash by the Company or such Subsidiary in the ordinary course of business and transfers of cash under the Company's cash management system in the ordinary course of business; (ii) dispositions by one Subsidiary to the Company or a wholly-owned subsidiary of the Company; (iii) (a) sales of inventory in the ordinary course of business, (b) sales, assignments, transfers or other dispositions in the ordinary course of business consistent with past practice of any Property that, in the reasonable opinion of the Company or such Subsidiary, as the case may be, is obsolete and (c) sales, assignments, transfers or other dispositions of any Property that, in the reasonable opinion of the Company or such Subsidiary, as the case may be, is no longer useful in the conduct of its business as currently conducted having a fair market value in the good faith determination of the Company of not more than $5,000,000 in the aggregate, provided that all Net Cash Proceeds from such sales, assignments, transfers or dispositions are deposited in the Disbursement Account or the Reserve Account, as the case may be, in accordance with paragraph 8.6(iv); and (iv) sales, assignments, transfers or other dispositions of the Property described on Schedules B-1, B-2 and B-3 to Amendment No. 3 (together with the sales, assignments, transfers and dispositions described in paragraph 8.6(iii)(c), each a "PERMITTED DISPOSITION" and collectively, the "PERMITTED DISPOSITIONS") for cash and non-cash consideration (including assumption of Indebtedness) payable or received on the date of such Permitted Disposition provided that: (a) the Net Cash Proceeds of each such Permitted Disposition with respect to the Property described on Schedule B-1 to Amendment No. 3 shall be in an amount of not less than 90% of the amount set forth on Schedule B-1 to Amendment No. 3 opposite the description of such Property, 14 (b) the Net Cash Proceeds of each such Permitted Disposition with respect to the Property described on Schedule B-2 to Amendment No. 3 shall be in an amount of not less than 75% of the amount set forth on Schedule B-2 to Amendment No. 3 opposite the description of such Property, (c) all Net Cash Proceeds of each Permitted Disposition (other than Net Cash Proceeds applied in repayment of the Liquidity Loans and the permanent reduction of the Liquidity Subfacility Amount pursuant to paragraph 2.6) in an aggregate amount for all Permitted Dispositions of up to the sum of (x) $100,000,000 and (y) the Restructuring Costs shall be deposited directly on the date of receipt by the Company or such Subsidiary in the Disbursement Account, which Net Cash Proceeds shall be held and disbursed in accordance with paragraph 2.25 of this Agreement, (d) the Net Cash Proceeds of any Permitted Disposition (other than Net Cash Proceeds applied in repayment of the Liquidity Loans and the permanent reduction of the Liquidity Subfacility Amount pursuant to paragraph 2.6) in excess of the sum of (x) $100,000,000 for all asset sales in the aggregate and (y) the Restructuring Costs shall be deposited directly on the date of receipt by the Company or such Subsidiary in the Reserve Account, which Net Cash Proceeds shall be held and disbursed in accordance with paragraph 2.25 of this Agreement, (e) no Default or Event of Default shall have occurred and be continuing on the date of and after giving effect to such Permitted Disposition, (f) promptly after execution of such agreement or contract but in any event not less than 10 Business Days prior to such sale, the Company shall have furnished the Agent a copy of the agreement or contract for the sale of the applicable Property and a statement setting forth, on a PRO FORMA basis, the total consideration to be paid to the Company (or other seller) under the agreement or contract for the sale for such Property and the estimated amount, if any, of the Disposition Closing Costs and Disposition Related Debt to be assumed or to be paid from the consideration for the sale and the Net Cash Proceeds to be realized (by the Company or other seller) from the sale after the deduction or payment of the Disposition Closing Costs and Disposition Related Debt (each a "PRO-FORMA SALE STATEMENT"), and within 5 Business Days after the consummation of such sale, the Company shall deliver to the Agent a closing statement 15 or such other statement indicating any material variance between the Pro Forma Sale Statement and the actual amount received and paid in connection with such sale, and (g) notwithstanding the foregoing, all Net Cash Proceeds of the sale, assignment, transfer or other disposition of the Collateral shall first be applied as a mandatory prepayment of the Liquidity Loans and to permanently reduce the Liquidity Subfacility Amount in accordance with paragraph 2.6(b). 1.17 Section 8.9 of the Credit Agreement is hereby deleted in its entirety and the following substituted therefor: 8.9 FIXED CHARGE COVERAGE RATIO. Permit the Fixed Charge Coverage Ratio to be less than: (i) 1.25 to 1.00 for the four fiscal quarters (taken as a whole) ending on December 31, 1999, (ii) 1.10 to 1.00 for the four fiscal quarters (taken as a whole) ending on March 31, 2000, (iii) 0.95 to 1.00 for the four fiscal quarters ending on June 30, 2000, and (iv) 1.50 to 1.00 for any four fiscal quarters (taken as a whole) ending on the last day of each September, December, March and June thereafter. 1.18 Section 8 of the Credit Agreement is hereby amended by adding new Sections 8.11, 8.12, 8.13, 8.14 and 8.15 at the end thereof to read in their entirety as follows: 8.11 INVESTMENTS, LOANS, ADVANCES AND GUARANTEES. At any time, purchase or otherwise acquire (including pursuant to any merger with any Person), hold or invest in any capital stock, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing and any derivative product) of, make or permit to exist any loans to or advances on behalf of, incur any Guarantees in respect of any obligations of, or make or permit to exist any investment or any other interest in, any other Person (all of which are sometimes referred to 16 herein as "INVESTMENTS"), (or permit any Subsidiary to do any of the foregoing) except: (i) Investments in cash and cash equivalents and in normal business banking accounts on deposit with or issued by, federally insured institutions; (ii) Investments in Hedging Agreements entered into in connection with Credit Facility Indebtedness; (iii) Investments described in the Projections not otherwise prohibited by the terms hereof; (iv) Guarantees of Indebtedness and Credit Facility Indebtedness permitted by paragraph 8.1; (v) Investments existing on the Amendment No. 3 Effective Date; (vi) Advances to the Ottawa Senators Hockey Club Corporation under the commitment of the Company in effect on the Amendment No. 3 Effective Date (and as thereafter amended in accordance with the terms hereof); (vii) with respect to existing (or permitted pursuant to paragraph 8.1) debt financing on projects of the Company's energy business, any Investments made from time to time of amounts deposited in debt service reserve funds and other funds and accounts created under the indenture pertaining to such debt financing, provided that such Investments are made in accordance with the terms of the related indenture, including, without limitation, provisions dealing with permitted investments; and (viii) the Investments described in clauses (i) and (ii) of paragraph 8.12. 8.12 ACQUISITIONS. At any time, make, or enter into an agreement to make (or permit any Subsidiary to make or enter into an agreement to make), any Acquisition or make any deposit in connection with any potential Acquisition except (i) for the Acquisition by the Company of an interest in Gulf Electric Public Company Limited (Thailand) for an aggregate purchase price not to exceed $28,000,000 and (ii) for activities in respect of the acquisition or development of new facilities, 17 projects or investments for the Company's energy business, so long as (1) any activity engaged in by the Company or any Subsidiary or any agreement entered into by the Company or any Subsidiary with respect to such activities may be terminated or cancelled by the Company or such Subsidiary without liability to the Company or such Subsidiary other than the forfeiture of any deposit made by the Company or such Subsidiary, and (2) any deposits made by the Company or any of its Subsidiaries (irrespective of the form of the deposit, including without limitation, cash deposits or bonds) in respect of the activities or agreements described in Section 8.12 (ii) shall not exceed $2,500,000 in the aggregate. 8.13 PAYMENTS OF INDEBTEDNESS. Except as specifically set forth in the Projections (in the categories and in the amounts set forth therein): (i) pay or obligate itself to pay (or permit any Subsidiary to pay or obligate itself to pay), in whole or in part, the principal amount of any Indebtedness or Credit Facility Indebtedness; provided, however, so long as no Default or Event of Default then exists or results therefrom, the Company and any Subsidiary may pay or prepay: (1) Indebtedness or Credit Facility Indebtedness permitted to be paid pursuant to paragraph 8.15; (2) reimbursement obligations for drawings under letters of credit made to fund scheduled interest payments; (3) reimbursement obligations for drawings under letters of credit solely to the extent that the amount available for drawing under any such letter of credit after giving effect to such payment increases by an amount equal to such payment; and (4) reimbursement obligations for drawings under letters of credit made from the proceeds of the remarketing notes or other obligations, so long as such payments are made solely out of the proceeds of the remarketing of the notes or other obligations with respect to which such letters of credit were issued and the applicable letters of credit remain outstanding, or 18 (ii) incur or make (or permit any Subsidiary to incur or make) any payment in respect of lease buyout obligations. 8.14 CAPITAL EXPENDITURES. Incur (or permit any Subsidiary to incur) Capital Expenditures; provided, however, so long as no Default or Event of Default then exists or results therefrom, (a) the Company and its Subsidiaries may make the Capital Expenditures in accordance with the categories and amounts set forth in the Projections, subject to (i) reallocation of amounts among categories as a result of cost and expense savings and (ii) prospective cost overruns with respect to the Jazzland project in an amount not to exceed $12,000,000 (based on a budgeted total cost for such project of $110,000,000) and (b) the operating Subsidiaries of the Company may make Capital Expenditures in the ordinary course of business consistent with past practice, provided that such Capital Expenditures do not require the contribution of funds from the Company or any Subsidiary of the Company in excess of the amounts permitted by clause (a) above. 8.15 MOST FAVORED NATION COVENANTS. (a) Prepay, redeem, purchase, defease or otherwise satisfy or amend, modify or extend (or permit any Subsidiary to prepay, redeem, purchase, defease or otherwise satisfy or amend, modify or extend) any existing Indebtedness or Credit Facility Indebtedness, except: (i) Disposition Related Debt, (ii) extensions, renewals and replacements of Indebtedness or Credit Facility Indebtedness permitted by paragraph 8.l and, without duplication, payments permitted by paragraph 8.13(i), (iii) extension of the maturity of the indebtedness represented by the Amended and Restated Promissory Note, dated February 17, 2000, from Ogden Power Corporation to Pacific Enterprises Energy Management Services in the amount of $22,913,605.00 and related credit support, (iv) Indebtedness of the Company and its Subsidiaries in respect of the Subfacility under this Agreement and the other Loan Documents, or 19 (v) to the extent that, contemporaneously therewith or prior thereto, the Commitments of the Lenders are reduced and the Loans are repaid in an equal and ratable manner; (b) grant (or permit any Subsidiary to grant) any Lien in respect of any of its Property, Stock or assets to secure any existing Indebtedness, except: (i) Liens permitted under Section 8.2 of this Agreement, or (ii) to the extent that the Company's (or such Subsidiary's) obligations under this Agreement and the other Loan Documents are contemporaneously therewith or prior thereto equally and ratably secured, or (c) pay (or permit any Subsidiary to pay) any fee or other similar consideration to any holder of any Indebtedness to amend or waive any term or provision thereof at a rate or amount greater than that paid or payable to the Agent and the Lenders pursuant to paragraph 3.1(b) hereof and Section 3.1(g)(ii) of Amendment No. 3; provided, however, the Company may pay to creditors under Credit Facility Indebtedness a fee of up to one-quarter percent (1/4%) of the principal amount of any outstanding Credit Facility Indebtedness that matures prior to the Liquidity Subfacility Termination Date, or the amount available for drawing under any letter of credit outstanding under any Credit Facility Indebtedness that expires prior to the Liquidity Subfacility Termination Date, as consideration for the extension of such maturity date or expiry date to a date that is not earlier than the Liquidity Subfacility Termination Date, which fee shall be applied on account of any fee comparable to the fee described in paragraph 3.1(b) hereof payable to such creditors. 1.19 Section 9.1 of the Credit Agreement is hereby amended by (i) deleting the reference in Section 9.1(f) to "$25,000,000" and substituting therefor "$1,000,000", (ii) adding the phrase "or Credit Facility Indebtedness" after the term "Indebtedness" in Section 9.1(f), (iii) deleting the period at the end of Section 9.1(j) thereof and substituting a semi-colon therefor and (iv) adding new Sections 9.1(k), 9.1(l), 9.1(m), 9.1(n) and 9.1(o) at the end thereof to read in their entirety as follows: (k) except as specifically contemplated by paragraphs 2.25(e) and 2.27(d), any material Lien purported to be created under any Security Document shall cease to be, or shall be asserted by the Company or any Subsidiary not to be, a valid and perfected Lien on, 20 and security interest in, any Collateral, with the priority required by the applicable Security Document and such default, if not the result of any action or failure to act on the part of the Company or any Subsidiary, continues for a period of thirty (30) days or more; or any Subsidiary Guarantee or any provision thereof shall cease to be in full force or effect as to the relevant Subsidiary Guarantor, or any Subsidiary Guarantor or Person acting by or on behalf of such Subsidiary Guarantor shall deny or disaffirm such Subsidiary Guarantor's obligations under the relevant Subsidiary Guarantee, or any Subsidiary Guarantor shall default in any material respect in the due performance or observance of any term, covenant or agreement on its part to be performed or observed pursuant to its Subsidiary Guarantee; or (l) any letter of credit, bond or other credit or liquidity support shall have been terminated after its then stated expiration or termination date or shall have not been renewed beyond its then stated expiration or termination date, unless not later than five (5) days prior to such expiration or termination date, such letter of credit, bond or other credit or liquidity support is replaced with another such instrument on terms and conditions permitted under this Agreement (including, without limitation, the fees payable in connection with the issuance thereof); or (m) the occurrence of any Springing Credit Event and a demand, by any holder of a Springing Credit Obligation, for the issuance of a letter of credit, bond or other credit or liquidity support and such demand is not resolved on terms that do not violate the terms of this Agreement prior to the date on which the party making such demand is entitled to take remedial action under the applicable agreement (provided that a reduction in the annual fees payable to Ogden Martin Systems of Montgomery Inc. in an amount not to exceed $1,000,000 in connection with the service agreement between the Northeast Maryland Solid Waste Facility and Ogden Martin Systems of Montgomery Inc. shall not constitute an Event of Default); or (n) The Company or any Subsidiary shall pay or prepay the principal amount of any Indebtedness or Credit Facility Indebtedness, or repurchase any Indebtedness, in cash or in property, or set aside in any manner any cash or property in respect of any Indebtedness or Credit Facility Indebtedness, except as specifically permitted in paragraph 8.13 or 8.15; or 21 (o) The proceeds of any advances to the Ottawa Senators Hockey Club Corporation under the commitment of the Company to make advances to the Ottawa Senators Hockey Club Corporation in effect on the Amendment No. 3 Effective Date (and thereafter amended in accordance with the terms hereof) are used to repay the principal amount of any Indebtedness or Credit Facility Indebtedness except as provided under such commitment as in effect on the Amendment No. 3 Effective Date (and thereafter amended in accordance with the terms hereof). 1.20 Section 11.7(b) of the Credit Agreement is hereby amended by deleting the first sentence thereof in its entirety and substituting the following therefor: (b) Each Lender may, at any time and from time to time, sell, assign, transfer or negotiate, on a pro rata basis, a constant (and not varying) percentage of all of such Lender's rights and obligations with respect to its Commitment and its related Loans, obligations with respect to Letters of Credit and Notes, or if its Commitment shall have been terminated, its Loans, its obligations with respect to Letters of Credit and its Notes (provided that no Lender may sell, assign, transfer or negotiate any of its rights and obligations with respect to any Loan without selling, assigning, transferring or negotiating to the purchaser, assignee or transferee thereof a pro rata share in all such Lender's Loans, including Liquidity Loans) (x) to one or more other Lenders (or to Affiliates of such Lender or such other Lenders) upon prior written notice to the Company, the L/C issuing Bank and the Agent or (y) to any other Eligible Assignee upon the prior written consent of the Agent, the L/C Issuing Bank and, so long as no Event of Default then exists, the Company (which consents shall not be unreasonably withheld or delayed), provided that if such purchaser, assignee or transferee is not another Lender or an Affiliate of a Lender, (i) such selling, assigning or transferring Lender shall continue to hold at all times at least $2,500,000 of its original Commitment, or (ii) each such sale, assignment, transfer or negotiation shall be in an amount not less than the lesser of (A) $2,500,000 and (B) all of such Lender's Commitment and (iii) such selling, assigning or transferring Lender shall have paid to the Agent an assignment fee (the "ASSIGNMENT FEE") of $3,500 payable to the Agent. 2. AMENDMENTS TO CREDIT AGREEMENT -- LIQUIDITY SUBFACILITY. 2.1 Section 1.1 of the Credit Agreement is hereby amended by adding the following defined terms in the appropriate alphabetical order: 22 "AVIATION BUSINESS": the discontinued aviation business of the Company. "COLLATERAL": any and all "Collateral" as defined in any Security Document. "COLLATERAL CERTIFICATE": as defined in paragraph 2.27(b). "CZECH CREDIT AGREEMENT": the Credit Agreement between Czech-Ogden Airhandling, spol. s.r.o. and Ogden International Europe, Inc. in the principal amount of $17,451,804. "CZECH LOAN ASSIGNMENT": the assignment by Ogden International Europe, Inc. of the Czech Loan (as defined in the Czech Credit Agreement) to the Agent for the benefit of the Lenders, in form and substance satisfactory to the Agent, as amended, modified, supplemented, restated or replaced from time to time. "CZECH MORTGAGE": the first perfected Lien (or local law equivalent) given by Czech-Ogden Airhandling, spol. s.r.o. to the Agent for the ratable benefit of the Lenders, encumbering the cargo terminal owned by Czech-Ogden Airhandling, spol. s.r.o. at Praha-Ruzyne Airport in the Czech Republic. "DOMESTIC COLLATERAL": any and all "Collateral" as defined in any Domestic Security Document. "DOMESTIC SECURITY DOCUMENTS": collectively, the Security Agreement, the Mortgage, the Domestic Subsidiary Guarantee and all other instruments and documents delivered pursuant to paragraph 2.27 (other than Non-Domestic Security Instruments) to secure any of the obligations of the Company or any Domestic Subsidiary Guarantor under the Liquidity Subfacility. "DOMESTIC SUBSIDIARY": each Subsidiary that is organized under the laws of the United States of America, any state thereof, the District of Columbia or any territory thereof. "DOMESTIC SUBSIDIARY GUARANTEE": the Subsidiary Guarantee by and among the Domestic Subsidiary Guarantors, the Company and the Agent, in form and substance satisfactory to the Agent, as amended, modified, supplemented, restated or replaced from time to time. "DOMESTIC SUBSIDIARY GUARANTOR": Ogden Services Corporation, Ogden Aviation, each Domestic Subsidiary of Ogden Aviation and any other party to the Domestic Subsidiary Guarantee other than Ogden Allied Maintenance Securities Inc. and the Fuel Facilities Group. "FUEL FACILITIES GROUP": the companies listed on part (a) of Schedule F to Amendment No. 3. 23 "GUARANTEE SUPPLEMENT": a Guarantee Supplement in the form annexed to the Subsidiary Guarantee. "LIQUIDITY AVAILABILITY PERIOD": the period from the Liquidity Subfacility Effective Date to, but excluding, the Liquidity Subfacility Termination Date. "LIQUIDITY BORROWING": a borrowing of principal amounts pursuant to paragraph 2.26 consisting of Liquidity Loans of the same Type made by each Lender. "LIQUIDITY BORROWING REQUEST": a borrowing request in form and substance satisfactory to the Agent. "LIQUIDITY LOANS": Loans made as Base Rate Loans or Eurodollar Loans pursuant to paragraph 2.26. "LIQUIDITY SUBFACILITY": the secured subfacility provided for under paragraph 2.26. "LIQUIDITY SUBFACILITY AMOUNT": $50,000,000, as such amount may be reduced from time to time pursuant to paragraph 2.6(b). "LIQUIDITY SUBFACILITY EFFECTIVE DATE": the date on which the conditions set forth in Section 4.1 of Amendment No. 3 are satisfied. "LIQUIDITY SUBFACILITY TERMINATION DATE": July 31, 2000. "MORTGAGE": the first perfected mortgage given by Ogden Projects, Inc., to the Agent, for the ratable benefit of the Lenders, encumbering the office building located in Fairfield, New Jersey. "NON-DOMESTIC COLLATERAL": any and all "Collateral" (or any similar term describing the assets on which the Agent has been granted a Lien) as defined in any Non-Domestic Security Instrument. "NON-DOMESTIC SECURITY INSTRUMENTS": collectively, the Czech Credit Agreement Assignment, the Czech Mortgage and each instrument, document or agreement delivered pursuant to paragraph 2.27 granting or purporting to grant in favor of the Agent for the benefit of the Lenders a Lien on, or assigning or purporting to assign to the Agent for the benefit of the Lenders, any other Property or assets of, or any Stock of, any Non-Domestic Subsidiary to secure the obligations of the Company or any Subsidiary Guarantor under this Agreement or any of the Loan Documents, in each case as amended, modified, supplemented, restated or replaced from time to time. "NON-DOMESTIC SUBSIDIARY": each Subsidiary of Ogden Services Corporation that is not a Domestic Subsidiary and is engaged in the Aviation Business. 24 "NON-DOMESTIC SUBSIDIARY GUARANTEE": collectively, each Guarantee by any Non-Domestic Subsidiary Guarantor in favor of the Agent, in form and substance satisfactory to the Agent, as amended, modified, supplemented, restated or replaced from time to time. "NON-DOMESTIC SUBSIDIARY GUARANTOR": each Non-Domestic Subsidiary of Ogden Aviation and any other party to any Non-Domestic Subsidiary Guarantee. "OGDEN AVIATION": Ogden Aviation, Inc. a wholly owned Subsidiary of Ogden Services Corporation. "ORIGINAL NOTE" and "ORIGINAL NOTES": as defined in paragraph 2.4(a). "1992 SENIOR NOTE INDENTURE": the Indenture dated March 1, 1992 between the Company and The Bank of New York, as trustee, providing for the issuance of the Company's 9-1/4% debentures due March 1, 2022, as amended, modified or supplemented from time to time. "PERFECTION CERTIFICATE": a certificate in the form of Annex A to the Security Agreement or any other form approved by the Agent. "SECURED LIQUIDITY NOTE" and "SECURED LIQUIDITY NOTES": as defined in paragraph 2.4(b). "SECURED PARTIES": as defined in the Security Agreement. "SECURITY AGREEMENT": a Security Agreement and Assignment, by and among the Loan Parties party thereto and the Agent, in form and substance satisfactory to the Agent, as amended, modified, supplemented, restated or replaced from time to time. "SECURITY DOCUMENTS": collectively, upon the execution and delivery thereof, the Domestic Security Documents, the Non-Domestic Subsidiary Guarantees, the Non-Domestic Security Instruments and all other instruments and documents delivered pursuant to paragraph 2.27 to secure any of the obligations of the Company and each Subsidiary Guarantor under this Agreement or any of the Loan Documents. "SUBSIDIARY GUARANTEE": collectively, the Domestic Subsidiary Guarantee and the Non-Domestic Subsidiary Guarantees. "SUBSIDIARY GUARANTOR": the Domestic Subsidiary Guarantors and the Non-Domestic Subsidiary Guarantors. 2.2 The definition of "Affected Principal Amount" set forth in Section 1.1 of the Credit Agreement is hereby amended by adding the phrase "or paragraph 2.26(a)" after the phrase "paragraph 2.2" in clause (i) thereof. 25 2.3 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Base Rate Loans" in its entirety and substituting the following therefor: "BASE RATE LOANS": R/C Loans or Liquidity Loans (or any portions thereof) at such time as they (or such portions) are made or are being maintained at a rate of interest based upon the Base Rate. 2.4 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Borrowing Date" in its entirety and substituting the following therefor: "BORROWING DATE": any date specified in a Borrowing Request delivered pursuant to paragraphs 2.2, 2.3, 2.20 or 2.26 as a date on which the Company requests the Lenders to make Loans comprising an R/C Borrowing, a Liquidity Borrowing or a Competitive Bid Borrowing or the L/C Issuing Bank to issue a Letter of Credit. 2.5 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Borrowing Request" in its entirety and substituting the following therefor: "BORROWING REQUEST": an R/C Borrowing Request, a Liquidity Borrowing Request, Competitive Bid Borrowing Request or L/C Issuance Request, as the case may be. 2.6 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Conversion Date" in its entirety and substituting the following therefor: "CONVERSION DATE": with respect to R/C Loans or Liquidity Loans, the date on which a Eurodollar or CD Loan is converted to a Base Rate Loan, or the date on which a Base Rate Loan is converted to a Eurodollar or CD Loan, or the date on which a Eurodollar Loan is converted to a CD Loan or a new Eurodollar Loan or the date on which a CD Loan is converted to a Eurodollar Loan or a new CD Loan, all in accordance with paragraph 2.7. Notwithstanding the foregoing, at all times after the Amendment No. 3 Effective Date, no Base Rate Loan or Eurodollar Loan may be converted to a CD Loan, and no CD Loan may be converted to a new CD Loan. 2.7 The definition of "Interest Period" set forth in Section 1.1 of the Credit Agreement is hereby amended by adding the phrase "or Liquidity Borrowing" after the phrase "R/C Borrowing" in the introductory clause of paragraph (a) thereof. 2.8 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Loan" in its entirety and substituting the following therefor: 26 "LOAN": an R/C Loan, a Liquidity Loan or a Competitive Bid Loan, as the case may be. 2.9 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Loans" in its entirety and substituting the following therefor: "LOANS": R/C Loans, Liquidity Loans or Competitive Bid Loans, collectively. 2.10 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Loan Documents" in its entirety and substituting the following therefor: "LOAN DOCUMENTS" means, collectively, this Agreement, the Notes, the Security Documents, the Letters of Credit, the Applications for Letters of Credit and all other agreements, instruments and documents executed or delivered in connection herewith. 2.11 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Loan Parties" in its entirety and substituting the following therefor: "LOAN PARTIES" means, collectively, the Company and each Subsidiary Guarantor. 2.12 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Note" and "Notes" in their entirety and substituting the following therefor: "NOTE" and "NOTES": as defined in paragraph 2.4(b). 2.13 The definition of "Remaining Interest Period" set forth in Section 1.1 of the Credit Agreement is hereby amended by adding the phrase "or paragraph 2.26" after the phrase "paragraph 2.2" in clause (i) thereof. 2.14 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Required Lenders" in its entirety and substituting the following therefor: "REQUIRED LENDERS": at any time when no Loans are outstanding (whether or not Letters of Credit are then outstanding) or there are R/C Loans, Liquidity Loans and Competitive Bid Loans outstanding, Lenders having Commitments equal to more than 66 2/3% of the Aggregate Commitments. At any time when only R/C Loans are outstanding (whether or not Letters of Credit are then outstanding), Lenders holding Original Notes having an unpaid principal balance equal to more than 66 2/3% of the aggregate Loans outstanding. At any time when only Liquidity Loans are outstanding (whether or not Letters of Credit are then outstanding), Lenders 27 holding Secured Liquidity Notes having an unpaid principal balance equal to more than 66 2/3% of the aggregate Loans outstanding. At any time when only Competitive Bid Loans are outstanding (whether or not Letters of Credit are then outstanding), Lenders having Commitments equal to more than 66 2/3% of the Aggregate Commitments (whether used or unused), except that for purposes of paragraph 9.2(a)(i) and paragraphs 9.2(a)(ii)(B), the term "Required Lenders" shall mean Lenders holding more than 66 2/3% of the outstanding Competitive Bid Loans if no Letters of Credit are then outstanding, but if Letters of Credit are also then outstanding, such term shall mean Lenders holding more than 66 2/3% of the outstanding Competitive Bid Loans and Lenders having more than 66 2/3% of the Letter of Credit Exposure. 2.15 Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Type" in its entirety and substituting the following therefor: "TYPE": R/C Loans made hereunder as Base Rate Loans, Eurodollar Loans or CD Loans, as the case may be and Liquidity Loans made hereunder as Base Rate Loans or Eurodollar Loans, as the case may be. 2.16 Section 2.4 of the Credit Agreement is hereby amended by (i) renumbering the existing paragraph as Section 2.4(a), (ii) deleting each reference therein to "Note" or "Notes" and substituting therefor "Original Note" or "Original Notes", as the case may be, and (iii) adding a new Section 2.4(b) at the end thereof to read in its entirety as follows: (b) The Liquidity Loans made by each Lender shall be evidenced by a promissory note of the Company, in form and substance satisfactory to the Agent (each, as endorsed or modified from time to time, including all replacements thereof and substitutions therefor, a "SECURED LIQUIDITY NOTE" and, collectively with the Secured Liquidity Notes of all other Lenders, the "SECURED LIQUIDITY NOTES"; and together with the Original Note of such Lender, a "NOTE" and, collectively with the Notes of all other Lenders, the "NOTES"), payable to the order of such Lender and representing the obligation of the Company to pay the lesser of (a) the amount of the Liquidity Subfacility Amount or (b) such lesser amount as shall equal the aggregate unpaid principal balance of all Liquidity Loans made by such Lender, in each case with interest thereon as prescribed in paragraph 2.8. Each Lender is hereby authorized to record (i) the date and amount of each Liquidity Loan made by such Lender, (ii) its character as a Base Rate Loan, a Eurodollar Loan, or a combination 28 thereof, (iii) the Interest Period and interest rate applicable to Eurodollar Loans, and (iv) the date and amount of each conversion of, and each payment or prepayment of principal of, any Liquidity Loans, on the schedule (and any continuations thereof) annexed to and constituting a part of its Secured Liquidity Note. No failure to so record or any error in so recording shall affect the obligation of the Company to repay the Liquidity Loans, with interest thereon, as herein provided. Each Secured Liquidity Note shall (1) be dated the first Liquidity Borrowing Date, (2) be stated to mature on the Liquidity Subfacility Termination Date, and (3) bear interest for the period from and including the date thereof on the unpaid principal balance thereof from time to time outstanding at the applicable interest rate or rates per annum determined as provided in paragraph 2.8. Interest on each Secured Liquidity Note shall be payable as specified in paragraph 2.8. 2.17 Section 2.5(a) of the Credit Agreement is hereby amended by adding the phrase ", Liquidity Loans" immediately after the phrase "R/C Loans" in the first sentence thereof. 2.18 Section 2.6(a) of the Credit Agreement is hereby amended by (i) adding the phrase "or Liquidity Loans" immediately after the term "R/C Loans" in the first sentence thereof, (ii) adding the phrase "or Liquidity Loans, as the case may be" after the term "R/C Loans" in the fifth sentence thereof and (iii) adding a new sentence at the end thereof to read in its entirety as follows: Upon each prepayment of the Liquidity Loans under this paragraph 2.6(a), the Liquidity Subfacility Amount shall be permanently reduced by the principal amount of such prepayment. 2.19 Section 2.6(b) of the Credit Agreement is hereby deleted in its entirety and the following substituted therefor: (b) MANDATORY PREPAYMENTS. (i) The Company shall prepay the R/C Loans and the Competitive Bid Loans in the amounts, if any, and on the dates set forth in paragraph 2.18(a) or paragraph 2.18(b). (ii) In addition to any other mandatory repayments or commitment reductions pursuant to this paragraph 2.6(b), on each date after the Amendment No. 3 Effective Date upon which the Company or any of its Subsidiaries shall receive any proceeds from any sale, assignment, transfer or other disposition of any Property constituting all or any part of the Collateral, the Liquidity Subfacility Amount shall be permanently reduced and the Company shall prepay 29 the aggregate unpaid Liquidity Loans in an amount equal to 100% of the Net Cash Proceeds with respect to such sale, assignment, transfer or other disposition. 2.20 Section 2.8 of the Credit Agreement is hereby amended by (i) deleting the third parenthetical phrase in the first sentence of Section 2.8(b) in its entirety and substituting "(as determined under paragraph 2.3 or as set forth in paragraph 2.8(a) or 2.8(d))" therefor and (ii) adding a new Section 2.8(d) at the end thereof to read in its entirety as follows: (d) LIQUIDITY LOANS PRIOR TO MATURITY. Prior to maturity, the outstanding principal balance of the Liquidity Loans shall bear interest on the unpaid principal balance thereof at the applicable interest rate or rates per annum set forth below: LOAN TYPE RATE Each Base Rate Loan Base Rate plus 1.00% Each Eurodollar Loan Eurodollar Rate for the applicable Interest Period plus 3.00% 2.21 Section 2 of the Credit Agreement is hereby amended by adding new Sections 2.26 and 2.27 to read in their entirety as follows: 2.26 LIQUIDITY LOANS. (a) Subject to the terms and conditions of this Agreement, each Lender severally agrees to make Liquidity Loans to the Company from time to time during the Liquidity Availability Period in an aggregate principal amount at any one time outstanding not to exceed such Lender's Commitment Percentage of the Liquidity Subfacility Amount, provided that (i) the aggregate unpaid principal balance of all Liquidity Loans at any one time outstanding shall not exceed the Liquidity Subfacility Amount and (ii) the aggregate unpaid principal balance of all Liquidity Loans, R/C Loans and Competitive Bid Loans at any one time outstanding, plus the Letter of Credit Exposure at such time, shall not exceed the Aggregate Commitments. During such period, the Company may borrow, prepay in whole or in part and reborrow Liquidity Loans, all in accordance with the terms and conditions hereof. Subject to the provisions of paragraphs 2.3 and 2.7, Liquidity Loans may be (a) Base Rate Loans or (b) Eurodollar Loans, or any combination thereof. Notwithstanding the foregoing, in the event that the Agent shall not have obtained a perfected first 30 priority Lien (or the equivalent thereof under the relevant local law) on the Non-Domestic Collateral on or before the Liquidity Subfacility Effective Date except for the Collateral described in the proviso to paragraph 2.27(a), the aggregate unpaid principal balance of all Liquidity Loans outstanding at any one time shall not exceed the lesser of $30,000,000 and the Liquidity Subfacility Amount at such time until the Agent shall have obtained a perfected first priority Lien (or the equivalent thereof under the relevant local law) on the Non-Domestic Collateral. Upon the Agent obtaining a perfected first priority Lien (or the equivalent thereof under the relevant local law) on the Non-Domestic Collateral pursuant to (and subject to the limitations set forth in) paragraph 2.27, the aggregate unpaid principal balance of all Liquidity Loans outstanding at any one time shall not exceed the Liquidity Subfacility Amount, subject to the provisions of the first sentence of this paragraph 2.26(a). (b) The Company may borrow Liquidity Loans on any Business Day occurring on or after the Liquidity Subfacility Effective Date and ending on the Liquidity Subfacility Termination Date, by giving the Agent an irrevocable telephonic (to be promptly confirmed in writing) or fax or other written notice of borrowing (each a "LIQUIDITY BORROWING REQUEST") no later than 11:00 A.M., New York City time, three Business Days prior to each requested Borrowing Date, in the case of Eurodollar Loans, and no later than 11:00 A.M., New York City time, two Business days prior to the requested Borrowing Date, in the case of Base Rate Loans, specifying (i) the aggregate amount of Liquidity Loans to be borrowed, (ii) the requested Borrowing Date, and (iii) whether the borrowing is to be of Eurodollar Loans, Base Rate Loans, or a combination thereof. Each borrowing of Eurodollar Loans comprising all or a portion of a Liquidity Borrowing shall be in an aggregate principal amount equal to $5,000,000 or such amount plus a whole multiple of $1,000,000. Each borrowing of Base Rate Loans comprising all or a portion of a Liquidity Borrowing shall be in an aggregate principal amount equal to $1,000,000 or such amount plus a whole multiple thereof or, if less, the unused amount of the Liquidity Subfacility Amount. Upon receipt of each notice of borrowing from the Company, the Agent shall promptly notify each Lender thereof. Subject to its receipt of the notice referred to in the preceding sentence, each Lender will make the amount of its Commitment Percentage of each Liquidity Borrowing available to the Agent for the account of the Company at the office of the Agent set forth in paragraph 11.2 not later than 12:00 Noon, New York City time, on the Liquidity Borrowing Date requested by the Company, in funds immediately available to the Agent at such office. 31 The amounts so made available to the Agent on a Liquidity Borrowing Date will then, subject to the satisfaction of the terms and conditions of this Agreement as determined by the Agent, be made available on such date to the Company by the Agent at the office of the Agent specified in paragraph 11.2 by crediting the account of the Company on the books of such office with the aggregate of said amounts in like funds as received by the Agent. (c) Unless the Agent shall have received prior notice from a Lender (by telephone or otherwise, such notice to be confirmed by fax or other writing) that such Lender will not make available to the Agent such Lenders' pro rata share of the Liquidity Loans requested by the Company, the Agent may assume that such Lender has made such share available to the Agent on such Liquidity Borrowing Date in accordance with this paragraph, provided that such Lender received notice of the proposed Liquidity Borrowing from the Agent, and the Agent may, in reliance upon such assumption, make available to the Company on such Liquidity Borrowing Date a corresponding amount. If and to the extent such Lender shall not have so made such pro rata share available to the Agent, such Lender and the Company severally agree to pay without duplication to the Agent forthwith on demand such corresponding amount (to the extent not previously paid by the other), together with interest thereon for each day from the date such amount is made available to the Company until the date such amount is paid to the Agent, at a rate per annum equal to, in the case of the Company, the applicable interest rate set forth in paragraph 2.8, and, in the case of such Lender, the Federal Funds Rate in effect on each such day (as determined by the Agent). Such payment by the Company, however, shall be without prejudice to its rights against such Lender. If such Lender shall pay to the Agent such corresponding amount, such amount so paid shall constitute such Lender's Liquidity Loan as part of such Liquidity Loans for purposes of this Agreement, which Liquidity Loan shall be deemed to have been made by such Lender on the Liquidity Borrowing Date applicable to such Liquidity Loans. 2.27. SECURITY (a) In order to secure the due payment and performance by the Company of its obligations in respect of the Liquidity Loans and of the Subsidiary Guarantors of their obligations in respect of the Subsidiary Guarantees (the "SUBFACILITY OBLIGATIONS"), the Company shall, and cause the Subsidiary Guarantors to, grant to the Agent for the ratable benefit of the Lenders 32 a Lien on the Collateral in accordance with the Security Documents; provided, however, that nothing in this Agreement or any of the other Loan Documents shall require the Company or any Subsidiary Guarantor to grant to the Agent a Lien on any Non-Domestic Collateral (other than pursuant to the Czech Loan Assignment and the Czech Mortgage) to the extent (and only to the extent) that the granting of such Lien (i) would violate the terms of any material written agreement to which the Company or any Subsidiary Guarantor is a party or by which the Company, any Subsidiary Guarantor or such Non-Domestic Collateral is bound as of the Liquidity Subfacility Effective Date, (ii) contravene any applicable law, statute, rule or regulation or any order, writ, injunction or decree of any Governmental Body or (iii) result in material adverse tax consequences to the Company. (b) In the event that the Company or any Subsidiary Guarantor is unable as a result of the circumstances described in clauses (i), (ii) or (iii) of paragraph 2.27(a) to grant to the Agent a Lien on any of the Non-Domestic Collateral, the Company shall deliver to the Agent a certificate (the "COLLATERAL CERTIFICATE") in form and substance satisfactory to the Agent identifying the Collateral on which the Agent will not obtain a Lien and setting forth in reasonable detail the reasons that the Company or such Subsidiary Guarantor is unable to grant such Lien, together with such supporting documentation (including, without limitation, copies of agreements translated into English and calculations of estimated tax consequences) as the Agent may reasonably request. (c) Upon receipt by the Agent with respect to each Non-Domestic Subsidiary of (i) a Lien on the Non-Domestic Collateral in accordance with this Agreement and the Security Documents or (ii) one or more Collateral Certificates with respect to the Non-Domestic Collateral on which the Agent is not entitled to obtain a Lien pursuant to the proviso to paragraph 2.27(a), the Agent shall promptly notify each Lender in writing of the receipt by the Agent of such Liens and certificates and the date, which shall be a date not earlier than 3 Business Days after the date of such notice, on which the limitation on the outstanding principal amount of Liquidity Loans set forth in the penultimate sentence of paragraph 2.26(a) shall terminate which shall be not later than 5 Business Days after the Agent shall have received such Liens and Certificates. (d) Provided no Default or Event of Default has occurred and is continuing, the Agent and the Lenders promptly will: 33 (i) release their security interest in the Collateral (including the Disbursement Account but not the Reserve Account) upon the written request of the Company after Ogden Services Corporation shall have deposited Net Cash Proceeds received by Ogden Services Corporation from the sale of the "food and beverage" business of not less than $51,000,000 in the Reserve Account as substitute collateral for the Collateral; and (ii) release their security interest in the Collateral (including the Disbursement Account and the Reserve Account) upon (A) the repayment in full of the Liquidity Loans and all accrued interest thereon and the termination of the Liquidity Subfacility, (B) the cancellation of the Liquidity Subfacility by the Company at any time that no Liquidity Loans are outstanding or (C) receipt by the Agent of Net Cash Proceeds from the sale of the Aviation Business and the simultaneous repayment in full of the Liquidity Loans and all accrued interest thereon and termination of the Liquidity Subfacility, which release shall be simultaneously with such sale and the receipt of such Net Cash Proceeds and repayment. The Agent and the Lenders shall execute and deliver to the Company such instruments and documents as the Company may reasonably request to evidence such release, at the sole cost and expense of the Company. 2.22 Section 3.1(a) of the Credit Agreement is hereby amended by adding the phrase "and all Liquidity Loans" after the phrase "all R/C Loans" in subclause (i) of clause (b) of the first sentence thereof. 2.23 Section 3.2 of the Credit Agreement is hereby amended by deleting the first two sentences thereof in their entirety and substituting the following therefor: With respect to the R/C Loans and Liquidity Loans, each borrowing by the Company from the Lenders, any conversion of R/C Loans or Liquidity Loans from one Type to another, and any reduction of the Commitments (other than a reduction arising under paragraph 2.18), shall be made pro rata according to the Commitment Percentage of each Lender. All payments (including prepayments) made by the Company to the Agent on account of principal of or interest on the R/C Loans and the Liquidity Loans, all payments in respect of unreimbursed obligations for the Letters of Credit, and any reduction of the participation in the face amount of a Letter of Credit, shall be made pro rata according to the outstanding principal amount of each Lender's R/C Loans or Liquidity Loans, as the case may be, and all payments (including prepayments) made by the Company on account of principal of or interest on the Competitive Bid Loans comprising 34 the same Competitive Bid Borrowing shall be made as specified in paragraphs 2.3(c) and 2.3(d). 2.24 Section 6.3 of the Credit Agreement is hereby deleted in its entirety and the following substituted therefor: 6.3 BORROWING REQUEST. With respect to any request for Loans or the issuance of a Letter of Credit, the Agent shall have received an R/C Borrowing Request, a Liquidity Borrowing Request, a Competitive Bid Borrowing Request or L/C Issuance Request, as the case may be, duly executed by an Authorized Signatory of the Company, accompanied by, with respect to each request for a Letter of Credit, an Application for Letter of Credit. 2.25 Section 7.1 of the Credit Agreement is hereby amended by adding the following new Section 7.1(d) at the end thereof to read in its entirety as follows: (d) concurrently with any delivery of financial statements under subsection (a) above commencing with fiscal year 2000, a certificate executed by the Chief Financial Officer and the general counsel of the Company (i) setting forth the information required pursuant to Section 2 of the Perfection Certificate or confirming that there has been no change in such information since the date of such certificate or the date of the most recent certificate delivered pursuant to this subsection (d), (ii) certifying that all Uniform Commercial Code financing statements or other appropriate filings, recordings or registrations, including all refilings, rerecordings and re-registrations, containing a description of the Collateral have been filed of record in each governmental, municipal or other appropriate office in each jurisdiction identified pursuant to clause (i) above in accordance with the Security Documents and (iii) identifying in the format of Schedule 8 to the Perfection Certificate Equity Interests (as defined in the Security Agreement), of the Company and each Subsidiary Guarantor in existence on the date thereof and not then listed on such Schedules or previously so identified to the Agent. 2.26 Section 7 of the Credit Agreement is hereby amended by adding a new Section 7.12 to read in its entirety as follows: 7.12 ADDITIONAL SUBSIDIARIES. In the event that on or after the Amendment No. 3 Effective Date, any Person shall become a Subsidiary of 35 Ogden Aviation or of any of its Subsidiaries (other than solely as a result of the corporate reorganization of the Company's aviation business and such Person is a party to, and such Person's assets and Capital Stock are subject to, the Security Documents), the Company shall (i) notify the Agent in writing thereof within three Business Days thereof, (ii) cause such Person to execute and deliver to the Agent a Guarantee Supplement and to become a party to each applicable Security Document in the manner provided therein within five Business Days thereafter and to promptly take such actions to create and perfect Liens on such Person's assets to secure such Person's obligations under the Loan Documents as the Agent or the Required Lenders shall reasonably request in accordance with the Security Documents, (iii) cause any shares of Stock of such new Subsidiary owned by or on behalf of any Loan Party to be pledged pursuant to the Security Agreement within five Business Days thereafter, (iv) cause each such new Subsidiary to deliver to the Agent any shares of Stock of any Subsidiary that are owned by or on behalf of such new Subsidiary within five Business Days after such Subsidiary is formed or acquired in accordance with the Security Documents, and (v) deliver to the Agent a Perfection Certificate with respect to such Subsidiary, such additional Financing Statements, Grants of Security Interest and Powers of Attorney (as each such term is defined in the Security Agreement) certificates, instruments and opinions as the Agent may request. 2.27 Section 11.1 of the Credit Agreement is hereby amended by (i) adding new clauses (x) and (xi) at the end of the first proviso thereof to read in their entirety as follows: or (x) release any Subsidiary Guarantor from its obligations under the Subsidiary Guarantee (except as expressly provided therein, under paragraphs 2.25(e) and 2.27(d) or as a result of the termination of the existence of such Subsidiary Guarantor in a transaction permitted by paragraph 8.6), or (xi) release all or substantially all of the Collateral from the Liens of the Security Documents (except as may be expressly permitted thereunder, under paragraphs 2.25(e) or 2.27(d) or in connection with a transaction permitted by paragraph 8.6) and (ii) by adding a new sentence at the end thereof to read in its entirety as follows: Notwithstanding the foregoing, the Agent, the Lenders and the Company acknowledge and agree that paragraph 2.25 (Disbursement Account, Reserve Account and Collateral for Subfacility) may not be amended to (x) limit the set off rights of the Agent in respect of the Disbursement Account and the Reserve Account as set forth in 36 paragraph 2.25, (y) change the provisions relating to the application of any amounts set off by the Agent in respect of the Disbursement Account or the Reserve Account in excess of the amounts necessary to satisfy the Subfacility Obligations or (z) change the provisions relating to the disbursement of funds from the Disbursement Account and the Reserve Account, without the consent of the Agent, the Required Lenders and the requisite creditors under the Credit Facility Indebtedness. 3. CONDITIONS TO EFFECTIVENESS OF AMENDMENT. 3.1 The effectiveness of the amendments set forth in Sections 1 and 2 of this Amendment No. 3 is subject to the prior or simultaneous fulfillment of the following conditions on or before 4:00 P.M. New York City time on April 27, 2000: (a) The Agent shall have received this Amendment No. 3 executed by (i) a duly authorized officer or officers of the Company and (ii) the Required Lenders; (b) The Agent shall have received such other documents as it shall have reasonably requested consistent with the terms hereof; (c) Holders of Indebtedness under any Covenant Credit Facility shall have executed, to the extent required by each such Covenant Credit Facility, waivers or amendments to such credit facilities satisfactory to the Agent and the Required Lenders (i) containing amendments to the covenants and related definitions in such credit facilities identical to those set forth in Section 1 of this Amendment No. 3 and (ii) containing agreements by such holders to (A) waive compliance by the Company or any of its Subsidiaries with, or amend, any provision of any instrument, document or agreement evidencing such Indebtedness requiring the sharing of any collateral securing the Liquidity Loans and (B) waive any default or event of default currently existing or occurring as a result of (x) the incurrence by the Company of Indebtedness under the Liquidity Loan subfacility, (y) the Guarantee by the Guarantors of the obligations of the Company in respect of the Liquidity Loans or (z) the granting of the liens and security interest to secure the obligations in respect of the Liquidity Loans and the obligations of the Subsidiary Guarantors under the Subsidiary Guarantee; (d) The Agent shall have received payment of all of its out-of-pocket expenses, including the reasonable fees and expenses of its counsel Emmet, Marvin & Martin, LLP incurred in connection with this Amendment No. 3; (e) The Agent shall have received the arrangement fee due to the Agent pursuant to the agreement between the Agent and the Company; 37 (f) The Agent shall have received confirmation that the attorneys and accountants for the Steering Committee have received retainer payments of $500,000 in the aggregate; (g) The Agent shall have received (i) a non-refundable Subfacility fee, for the pro-rata benefit of the Lenders, equal to $1,000,000 and (ii) a non-refundable amendment fee, for the pro-rata benefit of the Lenders, equal to $187,500; (h) The Agent shall have received for deposit in the Disbursement Account and, if applicable, the Reserve Account the Net Cash Proceeds of any Permitted Disposition closed prior to the Amendment No. 3 Effective Date; and (i) The representations and warranties contained in the Credit Agreement (other than the representations and warranties made as of a specific date) shall be true and correct in all material respects on and as of the Amendment No. 3 Effective Date, other than such exceptions as set forth on a disclosure certificate to be delivered to the Agent by the Company on or before the Amendment No. 3 Effective Date so long as such exceptions do not disclose the occurrence of a Material Adverse Change since the date of the Projections. 3.2 The date on which the conditions set forth in Section 3.1 are satisfied is the "AMENDMENT NO. 3 EFFECTIVE DATE" and until the conditions set forth in Section 3.1 are satisfied, the amendments set forth in Section 1 and 2 of this Amendment No. 3 are not effective. In the event that the conditions set forth in Section 3.1 have not been satisfied on or before 4:00 p.m. New York City time on April 27, 2000, this Amendment No. 3 shall terminate and shall be of no force or effect. 4. CONDITIONS TO EFFECTIVENESS AND AVAILABILITY OF LIQUIDITY SUBFACILITY. 4.1 The obligation of each Lender to make any Liquidity Loan up to an aggregate principal amount of all Liquidity Loans for all Lenders of $30,000,000 on a Liquidity Borrowing Date is subject to the satisfaction of the following conditions precedent as of the date of such Liquidity Loan: (a) The Agent shall have received the Secured Liquidity Notes duly executed by an Authorized Signatory of the Company; (b) The Agent shall have received a counterpart of each of the Security Agreement, the Domestic Subsidiary Guarantee, and each other Domestic Security Document, each dated the Liquidity Subfacility Effective Date, signed by the Company and each Subsidiary party thereto (or a facsimile of a signature page thereof signed by the Company and each such Subsidiary party thereto) together with the following: 38 (i) a completed Perfection Certificate, dated the Liquidity Subfacility Effective Date and signed by both a Financial Officer and the general counsel of the Company, together with all attachments contemplated thereby; (ii) one or more stock certificates, evidencing 100% of the issued and outstanding Capital Stock of Ogden Aviation and each Domestic Subsidiary owned by Ogden Aviation or any other Domestic Subsidiary Guarantor (other than the Stock of the Subsidiaries in the Fuel Facilities Group), in each case, together with undated stock powers with respect thereto, executed in blank by the Company or such Domestic Subsidiary Guarantor, as the case may be, and bearing a signature guarantee in all respects satisfactory to the Agent, if requested by the Agent; (iii) Uniform Commercial Code Financing Statements for each Domestic Subsidiary Guarantor covering accounts receivable, goods, machinery, equipment and other Collateral described in the Domestic Security Documents, executed by such Domestic Subsidiary Guarantor (subject, with respect to the Property described in part (b) of Schedule F hereto to the Liens described on part (b) of Schedule F), for the jurisdictions set forth on Schedule 3 to the Security Agreement; (iv) executed counterparts of mortgages, deeds of trust or similar documents in form and substance satisfactory to the Agent (collectively, as amended, restated, supplemented or otherwise modified from time to time, the "MORTGAGE") covering the real property of Ogden Projects, Inc. located in --------- Fairfield, New Jersey, together with mortgagee title insurance policies issued by title insurers reasonably satisfactory to the Agent in amounts reasonably satisfactory to the Agent (which policies shall include, without limitation, an endorsement for future advances under the Credit Agreement), a survey, in form and substance satisfactory to the Agent to such real property certified by a licensed professional surveyor satisfactory to the Agent and such other instruments, documents and agreements in connection with the execution, delivery and recording of the Mortgage and granting of a Lien on such real property in favor of the Agent as the Agent may reasonably request; and (v) such instruments, documents and agreements as the Agent may reasonably request in connection with the establishment of the Disbursement Account and the Reserve Account, and the granting of a Lien thereon in favor of the Agent for the benefit the Lenders; (c) The Agent shall have received certificates, dated the Liquidity Subfacility Effective Date, of the Secretary or Assistant Secretary of the Company and each Domestic Subsidiary Guarantor (i) attaching a true and complete copy of the resolutions of its Board of Directors and of all documents evidencing other necessary corporate action (in form and substance satisfactory to the Agent and to Special Counsel) taken by it to authorize this Amendment No. 3, the Loan Documents to be executed by it in connection herewith and the transactions contemplated hereby and thereby, (ii) attaching a true and complete copy of 39 its certificate of incorporation and by-laws, and (iii) setting forth the incumbency of its officer or officers who may sign the Loan Documents to which it is a party, including therein a signature specimen of such officer or officers, together with such other documents as the Agent or Special Counsel shall reasonably require; (d) There shall have occurred no Material Adverse Change and there shall not exist any material litigation in respect of the Company, its Subsidiaries or its businesses, or any material undisclosed liability of the Company or any of its Subsidiaries, in each case since the date of the Projections, and the Agent shall have received a certificate of an Authorized Signatory of the Company to such effect; (e) Each of the conditions set forth in Section 3.1 of this Amendment No. 3 and in Section 6 of the Credit Agreement shall have been satisfied; (f) The Agent shall have received the financial statements of the Company and its Subsidiaries described in Section 7.1(a) of the Credit Agreement as at and for the year ending December 31, 1999, together with the unqualified opinion of the Accountants with respect thereto; (g) The Agent shall have received projected financial statements for the energy division of the Company for the fiscal year ending December 31, 2000, in form and substance satisfactory to the Agent and the Required Lenders; (h) The Agent shall have received such other documents as it shall have reasonably requested; and (i) The Agent shall have received an opinion of counsel to the Company and the Domestic Subsidiary Guarantors, addressed to the Agent and the Lenders, dated the Liquidity Subfacility Effective Date, in form and substance satisfactory to the Special Counsel. 4.2 The obligation of the Lenders to make any Liquidity Loan in excess of an aggregate principal amount of $30,000,000 on a Liquidity Borrowing Date is subject to the satisfaction of the following conditions precedent as of the date of such Liquidity Loan: (a) The Agent shall have received with respect to each Non-Domestic Subsidiary Guarantor (1) the Czech Loan Assignment and the Czech Mortgage and (2) (x) a Collateral Certificate and/or (y) a counterpart of each of the other Non-Domestic Security Instrument, in each case executed by the Company and such Non-Domestic Subsidiary Guarantor (or a facsimile of a signature page thereof signed by the Company and such Non-Domestic Subsidiary Guarantor) together with the following: (i) a completed Perfection Certificate, signed by both a Financial Officer and the general counsel of the Company, together with all 40 attachments contemplated thereby, with respect to each Non-Domestic Subsidiary Guarantor; and (ii) one or more stock certificates, evidencing not less than 65% of the issued and outstanding Capital Stock of each Non-Domestic Subsidiary owned by Ogden Aviation or any other Subsidiary Guarantor, in each case, together with undated stock powers (or the equivalent, if any, under local law) with respect thereto, executed in blank by the Company or such Subsidiary Guarantor, as the case may be, and bearing a signature guarantee in all respects satisfactory to the Agent, if requested by the Agent; (b) The Agent shall have received certificates, dated the Liquidity Subfacility Effective Date, of the Secretary or Assistant Secretary of each Non-Domestic Subsidiary Guarantor (i) attaching a true and complete copy of the resolutions of its Board of Directors and of all documents evidencing other necessary corporate action (in form and substance satisfactory to the Agent and to Special Counsel) taken by it to authorize the Non-Domestic Security Instruments to be executed by it and the transactions contemplated thereby, (ii) attaching a true and complete copy of its certificate of incorporation and by-laws, and (iii) setting forth the incumbency of its officer or officers who may sign the Loan Documents to which it is a party, including therein a signature specimen of such officer or officers, together with such other documents as the Agent or Special Counsel shall reasonably require; (c) There shall have occurred no Material Adverse Change and there shall not exist any material litigation in respect of the Company, its Subsidiaries or its businesses, or any material undisclosed liability of the Company or any of its Subsidiaries, in each case since the date of the Projections; (d) Each of the conditions set forth in Section 6 of the Credit Agreement shall have been satisfied; and (e) The Agent shall have received such other documents as it shall have reasonably requested. 4.3 The date on which the conditions set forth in Section 4.1 are satisfied is the "LIQUIDITY SUBFACILITY EFFECTIVE DATE". 5. ACKNOWLEDGMENTS, REPRESENTATIONS AND WARRANTIES AND AGREEMENTS. 5.1 The Company hereby (a) reaffirms and admits the validity and enforceability of the Credit Agreement and the other Loan Documents and all of its obligations thereunder, and (b) represents and warrants to the Agent and each Lender: 41 (i) As of the date hereof, there exists no Default or Event of Default. (ii) The Company has full corporate power and authority to enter into, execute, deliver and carry out the terms of this Amendment No. 3 and the Loan Documents to which it is a party, and to make the borrowings and to incur the other obligations contemplated hereby and thereby, to issue, deliver and carry out the terms of the Secured Liquidity Notes and to incur the obligations provided for in the Credit Agreement as amended hereby and in the Secured Liquidity Notes, all of which have been duly authorized by all proper and necessary corporate action and are not in violation of its Restated Certificate of Incorporation or By-Laws. (iii) Each Subsidiary Guarantor has full corporate power and authority to enter into, execute, deliver and carry out the terms of the Loan Documents to which it is a party and to incur the obligations contemplated thereby, all of which have been duly authorized by all proper and necessary corporate action and are not in violation of its Certificate of Incorporation or By-Laws (or equivalent governing documents). (iv) No consent, authority or approval of, filing with, notice to, or exemption by, stockholders, any Governmental Body or any other Person (except for those which have been obtained, made or given) is required to authorize, or is required in connection with the execution, delivery and performance of this Amendment No. 3, the Credit Agreement as amended hereby or any Loan Document, or is required as a condition to the validity or enforceability of this Amendment No. 3, the Credit Agreement as amended hereby or any Loan Document. No provision of any applicable statute, law (including, without limitation, any applicable usury or similar law), rule or regulation of any Governmental Body will prevent the execution, delivery or performance of, or affect the validity of, this Amendment No. 3, the Credit Agreement as amended hereby or any Loan Document. (v) This Amendment No. 3 constitutes, and the Loan Documents to be executed and delivered in connection herewith, when issued, executed and delivered pursuant hereto for value received, will constitute, the valid and legally binding obligations of the Company and the Subsidiary Guarantors enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization or similar laws affecting enforcement of creditors' rights generally or by general principles of equity. (vi) The execution, delivery, carrying out of the terms of this Amendment No. 3, the Credit Agreement, as amended hereby and the Loan Documents (including, without limitation, the granting of a Lien on the Collateral pursuant to the Security Documents) or the borrowing of any Liquidity Loan will not constitute a default under, conflict with, require any consent under (other than consents which have been obtained), or result in the creation or imposition of, or obligation to create, any Lien upon the Property or assets of the Company or any of its Subsidiaries pursuant to the terms of any 42 mortgage, indenture (including, without limitation, the 1992 Senior Note Indenture), contract, agreement, judgment, decree or order. (vii) Schedule D to this Amendment No. 3 sets forth a true, correct and complete list of all Covenant Credit Facilities and each holder of any Indebtedness under any such facility as of the date hereof. (viii) Ogden Services Corporation is a direct, wholly-owned Subsidiary of the Company. Ogden Services Corporation on the Amendment No. 3 Effective Date owns beneficially and of record the Stock of the Subsidiaries that own all of the Property and assets of the Aviation Business (except for the Company's direct minority interest in the joint venture, Aeropuentos Argentina 2000 S.A.) and the Company's discontinued entertainment business (including the Stock of the Company's Subsidiaries that own the discontinued food and beverage business), and except for Ogden Allied Maintenance Securities Inc., the Fuel Facilities Group, Ogden Flight Services Group, Inc., Ogden Flight Properties, Inc. and FRC Holdings, Inc., has owned such Subsidiaries, Properties and assets for not less than five years (or such shorter time period as such Subsidiaries, Properties and assets have been owned directly or indirectly by the Company). (ix) All Disposition Related Debt either (a) is secured by a Lien on the Property being sold in the Permitted Disposition related thereto or (b) is a direct obligation of (i) the Subsidiary that owns the Property being sold in such Permitted Disposition or (ii) a Subsidiary whose right to the proceeds of such sale is structurally senior to any such right of the Company. All Disposition Related Debt paid upon sale shall be paid solely from the proceeds of sale. (x) The sole assets of the Subsidiaries that comprise the Fuel Facilities Group are pipes, tanks and related structures owned or held for the benefit of airlines serviced by the Fuel Facilities Group. 5.2 The Company specifically and unconditionally acknowledges and reaffirms its indebtedness to the Agent and the Lenders in the outstanding principal amount of $50,000,000 under the terms of the Credit Agreement and the other Loan Documents, together with all accrued and unpaid interest to the date hereof, interest to be accrued and other costs, charges and expenses as may accrue or become due under the terms of the Credit Agreement and the other Loan Documents, including but not limited to reasonable fees and expenses of counsel. The Company acknowledges and agrees that if and to the extent it maintains any defenses to its obligations under the Credit Agreement and the other Loan Documents arising through and including the date hereof, such defenses are hereby waived and released as a specific condition to the agreements of the Agent and the Lenders set forth herein, which waiver and release are unconditional and without limitation. 5.3 The Company hereby acknowledges that all sales, assignments, transfers or other dispositions of Property (other than the Property described on Schedules B-1, B-2 and B-3 hereto and sales, assignments, transfers or other dispositions of Property 43 permitted by Section 8.6 of the Credit Agreement) after the Amendment No. 3 Effective Date shall be subject to the prior review and written consent of the Agent and the Required Lenders. 5.4 All references to "this Agreement" in the Credit Agreement and to "the Credit Agreement" in the other Loan Documents shall be deemed to refer to the Credit Agreement as amended by this Amendment No. 3. All reference to the "representations and warranties" in the Credit Agreement or in the other Loan Documents shall be deemed to include the representations and warranties set forth in Section 5.1 of this Amendment No. 3. 5.5 Except as specifically set forth herein, the Credit Agreement and the other Loan Documents shall remain in full force and effect in accordance with their terms. 5.6 The Company hereby acknowledges that the Agent and the Lenders and holders of the Credit Facility Indebtedness may form the Steering Committee in order to, among other things, coordinate the monitoring of the Company's performance and the repayment of the Company's and its Subsidiaries' Indebtedness. In connection therewith, and without limiting the Company's obligations under Section 11.5 of the Credit Agreement, the Company shall pay or reimburse the Steering Committee for all of its reasonable fees and expenses, including, without limitation, fees and expenses incurred in connection with the engagement on behalf of the Steering Committee of an accounting firm and a law firm selected by the Steering Committee in their discretion. 5.7 In the event that the Company shall pay or become obligated to pay to any holder of any Credit Facility Indebtedness or any agent or trustee for any syndicate of holders of any Credit Facility Indebtedness in connection with the consent by such holder or syndicate of holders to the waiver or amendment of any provision of any instrument, document or agreement evidencing such Credit Facility Indebtedness to conform any such instrument, document or agreement to the terms of the Credit Agreement (as amended hereby) and this Amendment No. 3 any fee (each such fee a "CREDIT FACILITY FEE") in excess of 0.375% of the principal amount of such Credit Facility Indebtedness held by such holder or syndicate of holders, the Company shall pay to the Agent for the ratable benefit of the Lenders (simultaneously with the payment of each such Credit Facility Fee) an additional non-refundable fee equal to the difference between (x) the product of (i) a fraction, the numerator of which is the aggregate amount of such Credit Facility Fee and the denominator of which is the principal amount of such Credit Facility Indebtedness, multiplied by (ii) $50,000,000 and (y) $187,500. 44 5.8 Each of the Company, the Agent and each Lender acknowledges that nothing in this Amendment No. 3 or the Credit Agreement as amended hereby shall in any way limit the rights or remedies of the Agent and the Lenders upon the occurrence and during the continuance of an Event of Default or constitute a so-called "standstill agreement" (and neither this Amendment No. 3 nor any of the other amendments to the documents governing the Credit Facility Indebtedness shall be deemed to create any standstill obligation) between (i) the Company and any of its creditors or (ii) among any of the Company's creditors, and that each holder of indebtedness of the Company (including, without limitation, Credit Facility Indebtedness) shall retain all of its respective rights and remedies with respect to such indebtedness in accordance with the terms thereof, at law or otherwise. 6. MISCELLANEOUS. 6.1 This Amendment No. 3 may be executed by facsimile and in any number of counterparts, 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 No. 3 to produce or account for more than one counterpart signed by the party to be charged. 6.2 This Amendment No. 3 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. The parties hereto have caused this Amendment No. 3 to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written. 45 AMENDMENT NO. 3 - REVOLVING CREDIT AGREEMENT 46 AMENDMENT NO. 3 - REVOLVING CREDIT AGREEMENT 47 AMENDMENT NO. 3 - REVOLVING CREDIT AGREEMENT 48 EX-11 5 EXHIBIT 11 Exhibit 11 OGDEN CORPORATION AND SUBSIDIARIES DETAILS OF COMPUTATION OF EARNINGS PER SHARE
FOR THE THREE MONTHS ENDED MARCH 31, -------------------------------------------------------------------------------------------------- 2000 1999 ------------------------------------------------- ---------------------------------------------- Income Shares Per-Share Income Shares Per-Share (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount ------------ -------------- -------------- ------------- -------------- -------------- (In thousands, except per share amounts) Income (loss) from continuing operations $ (4,174) $ 4,059 Less: preferred stock dividend 17 35 ------------ ------------- Basic Earnings (Loss) Per Share (4,191) 49,559 $ (0.08) 4,024 48,960 $ 0.08 ============== ============== Effect of Dilutive Securities: Stock options (A) 494 Convertible preferred stock (A) 35 251 6% convertible debentures (A) (A) 5-3/4% convertible debentures (A) (A) ------------ -------------- -------------- ------------- -------------- -------------- Diluted Earnings (Loss) Per Share $ (4,191) 49,559 $ (0.08) $ 4,059 49,705 $ 0.08 ============ ============== ============== ============= ============== ==============
(A) Antidilutive Note: Basic earnings per common share was computed by dividing net income, reduced by preferred stock dividend requirements, by the weighted average of the number of shares of common stock outstanding during each period. Diluted earnings per common share was computed on the assumption that all convertible debentures, convertible preferred stock, and stock options converted or exercised during each period, or outstanding at the end of each period were converted at the beginning of each period or the date of issuance or grant, if dilutive. This computation provides for the elimination of related convertible debenture interest and preferred dividends. EX-27 6 EXHIBIT 27
5 1,000 3-MOS DEC-31-2000 JAN-01-2000 MAR-31-2000 80,223 0 271,686 18,886 12,126 1,132,397 2,427,795 594,091 3,642,750 660,315 1,852,044 0 37 24,806 385,365 3,642,750 9,629 236,006 10,228 202,374 0 0 9,458 (3,453) (603) (4,174) (25,310) 0 0 (29,484) ($0.59) ($0.59)
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