Exhibit 10.3
EXECUTION COPY
AMENDMENT No.2 and WAIVER dated as of November 14, 2001
(this "Amendment"), in respect of and to the Credit Agreement
dated as of November 12, 1999, as amended (the "Credit
Agreement"), among MAXXIM MEDICAL, INC. ("Holdings"), MAXXIM
MEDICAL GROUP, INC. (the "Borrower"), the LENDERS party thereto
(the "Lenders"), THE CHASE MANHATTAN BANK, as Administrative
Agent, Collateral Agent and Issuing Bank, BANKERS TRUST COMPANY,
as Co-Syndication Agent, ▇▇▇▇▇▇▇ ▇▇▇▇▇ CAPITAL CORPORATION, as
Co-Syndication Agent, CANADIAN IMPERIAL BANK OF COMMERCE, as
Co-Documentation Agent, and CREDIT SUISSE FIRST BOSTON, as
Co-Documentation Agent.
A. Pursuant to the Credit Agreement, the Lenders and the Issuing Bank
have extended credit to the Borrower, and have agreed to extend credit to the
Borrower, in each case pursuant to the terms and subject to the conditions set
forth therein.
B. The Borrower has requested that the Lenders agree to amend certain
provisions of the Credit Agreement as set forth herein.
C. The Lenders are willing so to amend such provisions of the Credit
Agreement, pursuant to the terms and subject to the conditions set forth herein.
D. Capitalized terms used and not otherwise defined herein shall have
the meanings assigned to them in the Credit Agreement (as amended hereby).
Accordingly, in consideration of the mutual agreements herein
contained and other good and valuable consideration, the sufficiency and receipt
of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1. AMENDMENTS TO SECTION 1.01. (a) The definition of the term
"Lenders" in Section 1.01 of the Credit Agreement is hereby amended by inserting
at the end of such Section, the following new text "and the Priority Revolving
Lenders".
(b) The definition of the term "Applicable Rate" in Section 1.01 of
the Credit Agreement is hereby amended and restated in its entirety as follows:
"APPLICABLE RATE" means, for any day (a) with respect to any Tranche B Term
Loan, the applicable Tranche B Rate, (b) with respect to any Tranche C Term
Loan, the applicable Tranche C Rate and (c) with respect to any ABR Loan or
Eurodollar Loan that is (i) an Existing Revolving Loan or a Tranche A Term
Loan,
2
or with respect to the commitment fees payable hereunder with respect to
the Existing Revolving Commitments or Tranche A Term Loans, as the case may
be, the applicable rate per annum set forth below therefor under the
caption "ABR Spread", "Eurodollar Spread" or "Commitment Fee Rate", as the
case may be, based upon the Leverage Ratio as of the most recent
determination date or (ii) a Priority Revolving Loan, or with respect to
the commitment fees payable hereunder with respect to the Priority
Revolving Commitments, as the case may be, the applicable rate per annum
set forth below therefor under the caption "ABR Spread", "Eurodollar
Spread" or "Commitment Fee Rate", as the case may be:
TRANCHE A/EXISTING REVOLVING
ABR EURODOLLAR COMMITMENT FEE
LEVERAGE RATIO: SPREAD SPREAD RATE
--------------- ------ ------ ----
CATEGORY 1
----------
Greater than or equal to 4.50 to 1.00 2.75% 3.75% 0.750%
CATEGORY 2
----------
Less than 4.50 to 1.00 but greater than 2.50% 3.50% 0.750%
or equal to 4.00 to 1.00
CATEGORY 3
----------
Less than 4.00 to 1.00 but greater than 2.25% 3.25% 0.500%
or equal to 3.50 to 1.00
CATEGORY 4 2.00% 3.00% 0.500%
----------
Less than 3.50 to 1.00
PRIORITY REVOLVING
ABR SPREAD EURODOLLAR SPREAD COMMITMENT FEE RATE
---------- ----------------- -------------------
3.75% 4.75% 1.250%
For purposes of the foregoing, (i) the Leverage Ratio shall be
determined as of the end of each fiscal quarter of the Borrower's
fiscal year based upon Holdings's consolidated financial statements
delivered pursuant to Section 5.01(a) or (b) and (ii) each change in
the Applicable Rate resulting from a change in the Leverage Ratio
shall be effective during the period commencing on and including the
date of delivery to the Administrative Agent of such consolidated
financial statements indicating such change and ending on the date
immediately preceding the effective date of the next such change,
PROVIDED that the Leverage Ratio shall be deemed to be in Category 1
(A) at any time that an Event of Default has occurred and is
continuing or (B) at the option of the Administrative Agent or at the
request of the Required Lenders if the Borrower fails to deliver the
consolidated financial statements required to be delivered by it
pursuant to Section 5.01(a) or (b), during the period from the
expiration of the time
3
for delivery thereof until such consolidated financial statements are
delivered.
(c) The definition of the term "Class" in Section 1.01 of the Credit
Agreement is hereby amended by (i) replacing the text "Revolving Loans" with the
text "Existing Revolving Loans, Priority Revolving Loans" and (ii) replacing the
text "Revolving Commitment" with the text "Existing Revolving Commitment,
Priority Revolving Commitment".
(d) The definition of the term "Consolidated Cash Interest Expense" in
Section 1.01 of the Credit Agreement is hereby amended by adding the following
text at the end thereof:
Consolidated Cash Interest Expense of the Borrower for (a) the
Test Period ending on or about December 31, 2001, shall be deemed to
be the sum of (i) $25,008,000, and (ii) Consolidated Cash Interest
Expense for the fiscal quarter of the Borrower ending on or about
December 31, 2001, (b) the Test Period ending on or about March 31,
2002, shall be deemed to be the sum of (i) $16,511,000, and (ii)
Consolidated Cash Interest Expense for the fiscal quarters of the
Borrower ending on or about December 31, 2001 and March 31, 2002, and
(c) the Test Period ending on or about June 30, 2002, shall be deemed
to be the sum of (i) $8,063,000, and (ii) Consolidated Cash Interest
Expense for the fiscal quarters of the Borrower ending on or about
December 31, 2001, March 31, 2002, and June 30, 2002.
(e) The definition of the term "Consolidated EBITDA" in Section 1.01
of the Credit Agreement is hereby amended by adding the following text at the
end thereof:
For all purposes other than the calculation of the
Applicable Rate, Consolidated EBITDA of the Borrower for (a) the Test
Period ending on or about December 31, 2001, shall be deemed to be the
sum of (i) $34,836,000 and (ii) Consolidated EBITDA for the fiscal
quarter of the Borrower ending on or about December 31, 2001, (b) the
Test Period ending on or about March 31, 2002, shall be deemed to be
the sum of (i) $21,213,000, and (ii) Consolidated EBITDA for the
fiscal quarters of the Borrower ending on or about December 31, 2001
and March 31, 2002, (c) the Test Period ending on or about June 30,
2002, shall be deemed to be the sum of (i) $11,036,000, and (ii)
Consolidated EBITDA for the fiscal quarters of the Borrower ending on
or about December 31, 2001, March 31, 2002, and June 30, 2002.
For all purposes other than the calculation of the Applicable
Rate, Consolidated EBITDA of the Borrower for any Test Period ending on or
4
about or after December 31, 2001, and on or before December 31, 2003,
shall be determined as provided above but (without duplication of any
add-backs to Consolidated EBIT made pursuant to any other provision in
this Agreement) by adding to Consolidated EBITDA as so determined for
such Test Period the amounts of all write-offs in connection with the
consolidation of facilities and restructuring charges, including
extraordinary restructuring charges, during such Test Period to the
extent that such write-offs and charges were deducted in determining
Consolidated EBIT of the Borrower for such Test Period, PROVIDED that
the aggregate amounts added pursuant to this sentence in determining
Consolidated EBITDA of the Borrower (a) with respect to the fiscal
quarter of the Borrower ending on or about December 31, 2001, shall
not in aggregate exceed $37,000,000, but, in any event, the aggregate
of any amounts added pursuant to this clause (a) in respect of any
category referred to in Column 1 of Schedule 1.01(d) shall not exceed
the amount set out in Column 2 of Schedule 1.01(d) for such category,
(b) with respect to the fiscal years 2002 and 2003 of the Borrower,
shall not exceed $33,000,000 for those fiscal years combined and shall
not exceed $30,000,000 in either of those years, and (c) during the
term of this Agreement shall not exceed $70,000,000.
(f) The definition of the term "Disqualified Stock" in Section 1.01 of
the Credit Agreement is hereby amended by adding at the end of the definition
immediately before the ".", the following text
PROVIDED FURTHER that, notwithstanding anything contained
elsewhere in this Agreement to the contrary, a requirement for
Holdings to redeem any Equity Interests with the Net Proceeds of the
issuance by Holdings of other Equity Interests as permitted by Section
6.08(a)(vii) shall not alone cause such Equity Interests to be
Disqualified Stock.
(g) The definition of the term "Holdings Notes Indenture" in Section
1.01 of the Credit Agreement is hereby amended by adding after the text
"Holdings Notes" the text "or Additional Holdings Notes or other discount notes
of Holdings issued pursuant to the New Equity Contribution".
(h) Paragraph (a) of the definition of the term "Prepayment Event" in
Section 1.01 of the Credit Agreement is hereby amended by (i) adding the text
"and" immediately before the text "(ii)", (ii) replacing the text of clause (ii)
with the following text:
so long as the Borrower is in compliance with Sections 6.12, 6.13 and
6.14 at the time of the applicable disposition, cash proceeds from any
dispositions described in clause (d) of Section 6.05 of (A) during the
period
5
beginning on the Amendment No.2 Effective Date and ending on December
31, 2001, and in each fiscal year of the Borrower thereafter that ends
on or before the later of (x) December 31, 2003, and (y) the last day
of the fiscal year of the Borrower during which the Priority Revolving
Commitments are terminated (such later date, the "Resumption Date"),
up to $7,500,000, PROVIDED that the aggregate amount excluded pursuant
to clause (ii)(A) during the period on and from the Amendment No.2
Effective Date until the Resumption Date shall not exceed $15,000,000
and (B) after the Resumption Date, up to the amounts described in
clauses (ii) and (iii) as in effect prior to the Amendment No. 2
Effective Date.
and (iii) deleting clause (iii) in its entirety.
(i) The definition of the term "Revolving Availability Period" in
Section 1.01 of the Credit Agreement is hereby amended and restated in its
entirety as follows:
"REVOLVING AVAILABILITY PERIOD" means the Existing Revolving Availability
Period or the Priority Revolving Availability Period, as the context may
require.
(j) The definition of the term "Revolving Commitment" in Section 1.01
of the Credit Agreement is hereby amended and restated in its entirety as
follows:
"REVOLVING COMMITMENT" means, with respect to any Existing Revolving
Lender, such Lender's Existing Revolving Commitment and, with respect to
any Priority Revolving Lender, such Lender's Priority Revolving Commitment.
(k) The definition of the term "Revolving Exposure" in Section 1.01
of the Credit Agreement is hereby amended and restated in its entirety as
follows:
"REVOLVING EXPOSURE" means, with respect to any Existing Revolving Lender,
such Lender's Existing Revolving Exposure and, with respect to any Priority
Revolving Lender, such Lender's Priority Revolving Exposure.
(l) The definition of the term "Revolving Lender" in Section 1.01 of
the Credit Agreement is hereby amended and restated in its entirety as follows:
"REVOLVING LENDER" means an Existing Revolving Lender or a Priority
Revolving Lender.
(m) The definition of the term "Revolving Loan" in Section 1.01 of
the Credit Agreement is hereby amended and restated in its entirety as follows:
6
"REVOLVING LOAN" means an Existing Revolving Loan or a Priority Revolving
Loan.
(n) The definition of the term "Revolving Maturity Date" in Section
1.01 of the Credit Agreement is hereby amended and restated in its entirety as
follows:
"REVOLVING MATURITY DATE" means, with respect to the Existing Revolving
Loans and the Existing Revolving Commitments, the Existing Revolving
Maturity Date and, with respect to the Priority Revolving Loans and the
Priority Revolving Commitments, the Priority Revolving Maturity Date.
(o) The definition of the term "Tranche B Rate" in Section 1.01 of
the Credit Agreement is hereby amended by replacing the percentages "2.75%" and
"3.75%" with "3.25%" and 4.25%", respectively.
(p) The definition of the term "Tranche C Rate" in Section 1.01 of
the Credit Agreement is hereby amended by replacing the percentages "3.00%" and
"4.00%" with "3.50%" and "4.50%", respectively.
(q) The following new definitions are added to Section 1.01 of the
Credit Agreement in appropriate alphabetical order, as set forth below:
"ADDITIONAL HOLDINGS NOTES" means any discount notes of Holdings (the terms
of which shall be not less favorable to the Lenders than the terms of the
Holdings Notes, except that the interest rate shall be a market interest
rate at the time of issuance as determined by Holdings in good faith).
"AMENDMENT NO. 2 EFFECTIVE DATE" means the date on which the conditions
specified in Section 11 of Amendment No. 2 dated as of November 14, 2001,
among Holdings, the Borrower, the Lenders and the other parties hereto are
duly satisfied.
"CASH TARGET AMOUNT" has the meaning assigned to such term in Section
2.01(d).
"EXISTING REVOLVING AVAILABILITY PERIOD" means the period from and
including the Closing Date to but excluding the earlier of the Existing
Revolving Maturity Date and the date of termination of the Existing
Revolving Commitments.
"EXISTING REVOLVING COMMITMENT" means, with respect to each Lender, the
commitment, if any, of such Lender to make Existing Revolving Loans and to
acquire participations in Letters of Credit and Swingline Loans hereunder,
expressed as an amount representing the maximum aggregate amount of such
Lender's Existing Revolving Exposure hereunder, as such commitment may be
7
(a) reduced from time to time pursuant to Section 2.08 and (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.04. The initial amount of the Existing Revolving
Commitment of each Existing Revolving Lender that became or becomes an
Existing Revolving Lender after the Closing Date is set forth in the
Assignment and Acceptance pursuant to which such Lender shall have assumed
its Existing Revolving Commitment. The initial aggregate amount of the
Lenders' Existing Revolving Commitments is $30,000,000.
"EXISTING REVOLVING EXPOSURE" means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's
Revolving Loans and its LC Exposure and Swingline Exposure at such time.
"EXISTING REVOLVING LENDER" means a Lender with an Existing Revolving
Commitment or, if the Existing Revolving Commitments have terminated or
expired, a Lender with any Existing Revolving Exposure.
"EXISTING REVOLVING LOAN" means a Loan made pursuant to clause (d) of
Section 2.01.
"EXISTING REVOLVING MATURITY DATE" means the date that is six years after
the Closing Date or the first Business Day thereafter, if such date is not
a Business Day.
"FUTURE NEW EQUITY CONTRIBUTION" means the transaction or transactions
comprising (a) the issue by Holdings after the Amendment No. 2 Effective
Date of pay-in-kind participating preferred stock of Holdings permitted
under Section 6.01(c) and warrants to acquire common stock of Holdings
(other than pursuant to the New Equity Contribution), for aggregate gross
cash proceeds of the amount (the "Maximum Required Amount") equal to the
positive difference (if any) between (i) $50,000,000 and (ii) the aggregate
gross cash proceeds (which shall be deemed to include the aggregate
principal amount of Indebtedness of the Borrower that was held by the
Sponsor or any Affiliate thereof and was incurred pursuant to Section
6.01(a)(xi) and then canceled or otherwise forgiven solely in exchange for
the issuance by Holdings of preferred stock and warrants referred to above)
received by Holdings pursuant to the New Equity Contribution, PROVIDED that
the aggregate liquidation preference of such preferred stock at the time of
issuance does not exceed the aggregate gross cash proceeds so received from
such issuance by more than the amount determined by Holdings in good faith
to reflect the market discount for such preferred stock at the time of
issuance, and (b) the contribution by Holdings of all such proceeds to the
Borrower as common equity.
8
"NEW EQUITY CONTRIBUTION" means the transactions comprising (a) the issue
by Holdings of pay-in-kind participating preferred stock of Holdings
permitted under Section 6.01(c) and warrants to acquire common stock of
Holdings, for aggregate gross cash proceeds (which shall be deemed to
include the aggregate principal amount of Indebtedness of the Borrower that
was held by the Sponsor or any Affiliate thereof and was incurred pursuant
to Section 6.01(a)(xi) and then canceled or otherwise forgiven solely in
exchange for the issuance by Holdings of preferred stock and warrants
referred to above) of at least $23,500,000, PROVIDED that the aggregate
liquidation preference of such preferred stock at the time of issuance does
not exceed the aggregate gross cash proceeds so received or deemed received
from such issuance by more than the amount determined by Holdings in good
faith to reflect the market discount for such preferred stock at the time
of issuance, and (b) the contribution by Holdings of all such proceeds to
the Borrower as common equity.
"PRIORITY REVOLVING AVAILABILITY PERIOD" means the period from and
including the day after the date on which the Future New Equity
Contribution is consummated to but excluding the earlier of the Priority
Revolving Maturity Date and the date of termination of the Priority
Revolving Commitments.
"PRIORITY REVOLVING COMMITMENT" means, with respect to each Lender, the
commitment, if any, of such Lender to make Priority Revolving Loans
hereunder, expressed as an amount representing the maximum aggregate amount
of such Lender's Priority Revolving Exposure hereunder, as such commitment
may be (a) reduced from time to time pursuant to Section 2.08 and (b)
reduced or increased from time to time pursuant to assignments by or to
such Lender pursuant to Section 9.04. The initial amount of each Lender's
Priority Revolving Commitment is set forth on Schedule 2.01A, or in the
Assignment and Acceptance pursuant to which such Lender shall have assumed
its Priority Revolving Commitment, as applicable. The initial aggregate
amount of the Lenders' Priority Revolving Commitments is $20,000,000 (or,
if less, the aggregate amount of the Priority Revolving Commitments set
forth on Schedule 2.01A).
"PRIORITY REVOLVING EXPOSURE" means, with respect to any Priority
Revolving Lender at any time, the sum of the outstanding principal amount
of such Priority Revolving Lender's Priority Revolving Loans.
"PRIORITY REVOLVING LENDER" means a Lender with a Priority Revolving
Commitment or, if the Priority Revolving Commitments have terminated or
expired, a Lender with any Priority Revolving Exposure.
"PRIORITY REVOLVING LOAN" means a Loan made pursuant to clause (e) of
Section 2.01.
9
"PRIORITY REVOLVING MATURITY DATE" means the date that is two years after
the Amendment No. 2 Effective Date or the first Business Day thereafter, if
such date is not a Business Day, PROVIDED that, if on the original Priority
Revolving Maturity Date no Default or Event of Default has occurred and is
continuing, the Borrower may, at the Borrower's option, extend the Priority
Revolving Maturity Date to the date that is three years after the Amendment
No. 2 Effective Date by (a) giving written notice to the Administrative
Agent and the Priority Revolving Lenders not later than 45 Business Days
prior to the original Priority Revolving Maturity Date and (b) paying to
each Priority Revolving Lender on the original Priority Revolving Maturity
Date an extension fee equal to 1.0% of the amount of each Priority
Revolving Lender's Priority Revolving Commitment on such date.
"REQUIRED PRIORITY REVOLVING LENDERS" means, at any time, Priority
Revolving Lenders having Priority Revolving Exposures representing more
than 50% of the sum of the total Priority Revolving Exposures at such time.
SECTION 2. AMENDMENT TO SECTION 1.03. Section 1.03 of the Credit
Agreement is hereby amended by inserting the following new text immediately
before the "." at the end of such Section:
From and after the Amendment No. 2 Effective Date, (i) each reference in
Sections 2.04 and 2.05 of the Credit Agreement to "Revolving Availability
Period" shall be deemed to be a reference to "Existing Revolving
Availability Period", (ii) each reference in Sections 2.04, 2.05, 2.12(b)
and 2.19(b) of the Credit Agreement and in the definition of the term
Applicable Percentage in Section 1.01 of the Credit Agreement to "Revolving
Commitment" shall be deemed to be a reference to "Existing Revolving
Commitment", (iii) each reference in Sections 2.04 and 2.05 of the Credit
Agreement to "Revolving Exposure" shall be deemed to be a reference to
"Existing Revolving Exposure", (iv) each reference in Sections 2.04, 2.05
and 2.12 of the Credit Agreement to "Revolving Lender" shall be deemed to
be a reference to "Existing Revolving Lender", (v) each reference in
Sections 2.05 and 2.06 of the Credit Agreement to "Revolving Loan" shall be
deemed to be a reference to "Existing Revolving Loan", and (vi) each
reference in Section 2.05 of the Credit Agreement to "Revolving Maturity
Date" shall be deemed to be a reference to "Existing Revolving Maturity
Date".
SECTION 3. AMENDMENTS TO ARTICLE II. (a) Section 2.01 of the Credit
Agreement is hereby amended by deleting all the text after the words "Tranche C
Commitment" in the first sentence of such Section and replacing such text with
the following:
,(d) in the case of each Existing Revolving Lender, to make Existing
Revolving Loans to the Borrower on the Closing Date and from time to time
during the
10
Existing Revolving Availability Period in an aggregate principal amount
that will not result in such Existing Revolving Lender's Existing Revolving
Exposure exceeding such Existing Revolving Lender's Existing Revolving
Commitment and (e) in the case of each Priority Revolving Lender, to make
Priority Revolving Loans to the Borrower from time to time during the
Priority Revolving Availability Period in an aggregate principal amount
that will not result in such Priority Revolving Lender's Priority Revolving
Exposure exceeding such Priority Revolving Lender's Priority Revolving
Commitment, PROVIDED that no Priority Revolving Loan will be made at any
time if, at such time, (i) the total Existing Revolving Exposures of all
Lenders is less than the total Existing Revolving Loan Commitments of all
Lenders at such time, or (ii) the aggregate amount of cash and face value
of Permitted Investments held by Holdings and its Subsidiaries exceeds
$2,000,000 after giving pro forma effect to such Priority Revolving Loan
and pro forma effect to any cash expenditures reasonably and in good faith
anticipated by the Borrower to be made within two Business Days after such
time (the "Cash Target Amount").
(b) Section 2.02(c) of the Credit Agreement is hereby amended by (i)
replacing the first reference to "ABR Revolving Borrowing" with the text "ABR
Existing Revolving Borrowing or ABR Priority Revolving Borrowing" and (ii)
deleting the text of the first proviso and replacing it with the following text:
PROVIDED that an ABR Existing Revolving Borrowing may be in an aggregate
amount that is equal to the entire unused balance of the Existing Revolving
Commitment or that is required to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.05(e) and an ABR Priority
Revolving Borrowing may be in an aggregate amount that is equal to the
entire unused balance of the Priority Revolving Commitment.
(c) Section 2.03(i) of the Credit Agreement is hereby amended by
deleting the text "Revolving Borrowing" and replacing it with the text "Existing
Revolving Borrowing, Priority Revolving Borrowing".
(d) Section 2.08(a) of the Credit Agreement is hereby amended and
restated in its entirety as follows:
SECTION 2.08. TERMINATION AND REDUCTION OF COMMITMENTS. (a)
Unless previously terminated, (i) the Tranche A Commitments, Tranche B
Commitments and Tranche C Commitments shall terminate at 5:00 p.m., New
York City time, on the Closing Date, (ii) the Existing Revolving
Commitments shall terminate on (A) the Existing Revolving Maturity Date or
(B) unless otherwise agreed in writing by Existing Revolving Lenders
holding a majority of the Existing Revolving Commitments, if more than
$20,000,000 in aggregate
11
principal amount of the Existing Notes is neither (I) repurchased as part
of the Debt Tender Offer nor (II) repaid on or before the Existing Notes
Refinancing Date with the proceeds of the issuance or incurrence of
Permitted Refinancing Indebtedness, the Existing Notes Refinancing Date and
(iii) the Priority Revolving Commitments shall terminate on the Priority
Revolving Maturity Date.
(e) Section 2.08(b) of the Credit Agreement is hereby amended and
restated in its entirety as follows:
(b) The Borrower may at any time terminate, or from time to time
reduce, the Commitments of any Class, PROVIDED that (i) each reduction of
the Commitments of any Class shall be in an amount that is an integral
multiple of $1,000,000 and not less than $5,000,000, (ii) the Borrower
shall not terminate or reduce the Existing Revolving Commitments (A) at
any time before the termination of the Priority Revolving Commitments or
(B) if, after giving effect to any concurrent prepayment of the Existing
Revolving Loans in accordance with Section 2.11, the sum of the Existing
Revolving Exposures would exceed the total Existing Revolving Commitments,
and (iii) the Borrower shall not terminate or reduce the Priority
Revolving Commitments if, after giving effect to any concurrent prepayment
of the Priority Revolving Loans in accordance with Section 2.11, the sum
of the Priority Revolving Exposures would exceed the total Priority
Revolving Commitments.
(f) Section 2.09(a) of the Credit Agreement is hereby amended and
restated in its entirety as follows:
SECTION 2.09. REPAYMENT OF LOANS; EVIDENCE OF DEBT. (a) The
Borrower hereby unconditionally promises to pay (i) to the Administrative
Agent for the account of each Existing Revolving Lender the then unpaid
principal amount of each Existing Revolving Loan of such Existing
Revolving Lender on the Existing Revolving Maturity Date, (ii) to the
Administrative Agent for the account of each Lender the then unpaid
principal amount of each Term Loan of such Lender as provided in Section
2.10, (iii) to the Swingline Lender the then unpaid principal amount of
each Swingline Loan on the earlier of the Existing Revolving Maturity Date
and the first date after such Swingline Loan is made that is the 15th or
last day of a calendar month and is at least two Business Days after such
Swingline Loan is made, PROVIDED that (A) on each date that an Existing
Revolving Borrowing is made and (B) if requested by the Swingline Lender,
on the last day of March, June, September and December of each year, the
Borrower shall repay all Swingline Loans then outstanding, and (iv) to the
Administrative Agent for the account of each Priority Revolving Lender the
then unpaid principal amount of each Priority Revolving Loan of such
Priority Revolving Lender on the Priority Revolving Maturity Date.
12
(g) Section 2.11(b) of the Credit Agreement is hereby amended and
restated in its entirety as follows:
(b) In the event that and on each occasion on which (i) the sum
of the Existing Revolving Exposures exceeds the total Existing Revolving
Commitments, the Borrower shall prepay Existing Revolving Borrowings or
Swingline Borrowings (or, if no such Borrowings are outstanding, deposit
cash collateral in an account with the Administrative Agent pursuant to
Section 2.05(j)) in an aggregate amount equal to such excess or (ii) the
sum of the Priority Revolving Exposures exceeds the total Priority
Revolving Commitments, the Borrower shall prepay Priority Revolving
Borrowings in an aggregate amount equal to such excess.
(h) Section 2.11 of the Credit Agreement is hereby amended by adding
new paragraphs (g), (h), (i) and (j) as follows:
(g) The Borrower shall, on the date of consummation of the New
Equity Contribution, apply the lesser of (i) $50,000,000 and (ii) the Net
Proceeds of the New Equity Contribution to prepay Existing Revolving Loans
and the remainder of such amount shall be available for general corporate
purposes.
(h) The Borrower shall, on the date of consummation of the
Future New Equity Contribution, apply the Net Proceeds of the Future New
Equity Contribution to prepay Existing Revolving Loans and the remainder
of such amount shall be available for general corporate purposes.
(i) In the event and on each occasion on which the aggregate
amount of cash and face value of Permitted Investments held by Holdings
and its Subsidiaries shall exceed the Cash Target Amount, the Borrower
will repay Priority Revolving Loans, if any, outstanding at such time in
the amount of such excess.
(j) Notwithstanding any of the provisions of this Agreement to
the contrary, (i) the Borrower may not voluntarily prepay Term Borrowings
pursuant to Section 2.11(a) prior to the termination of the Priority
Revolving Commitments, (ii) the Borrower may not prepay Existing Revolving
Loans or Swingline Loans if, after giving effect to such prepayment of
Existing Revolving Loans or Swingline Loans, any Priority Revolving Loans
shall remain outstanding, and (iii) any amounts that would at any time
prior to the termination of the Priority Revolving Commitments otherwise
be applied to the prepayment of Term Loans pursuant to any provision of
this Section 2.11 (other than Section 2.11(a)), shall instead be applied
at such time first, to prepay the Priority Revolving Loans (without any
reduction in the Priority Revolving Commitments) and, second, after all
13
outstanding Priority Revolving Loans have been reduced to zero, to prepay
Term Loans.
(i) Section 2.12 of the Credit Agreement is hereby amended by
adding a new paragraph (e) as follows:
(e) The Borrower agrees to pay to the Administrative Agent for the
account of each Priority Revolving Lender a commitment fee, which shall
accrue at the Applicable Rate on the average daily unused amount of the
Priority Revolving Commitment of such Lender during the period from and
including the Amendment No. 2 Effective Date to but excluding the date on
which such Priority Revolving Commitment terminates. Accrued commitment
fees shall be payable in arrears on the last day of January, April, July
and October of each year and on the date on which the Priority Revolving
Commitments terminate, commencing on the first such date to occur after
the date hereof. All commitment fees shall be computed on the basis of a
year of 360 days and shall be payable for the actual number of days
elapsed (including the first day but excluding the last day). For purposes
of computing commitment fees with respect to Priority Revolving
Commitments, a Priority Revolving Commitment of a Lender shall be deemed
to be used to the extent of the outstanding Priority Revolving Loans of
such Lender.
(j) Section 2.13(d) of the Credit Agreement is hereby amended by (i)
replacing the text "in the case of Revolving Loans, upon termination of the
Revolving Commitments" with the text "in the case of Existing Revolving Loans,
upon termination of the Existing Revolving Commitments and, in the case of
Priority Revolving Loans, upon termination of the Priority Revolving
Commitments" and (ii) replacing the text "(other than a prepayment of an ABR
Revolving Loan prior to the end of the Revolving Availability Period)" with the
text "(other than a prepayment of an ABR Existing Revolving Loan prior to the
end of the Existing Revolving Availability Period and an ABR Priority Revolving
Loan prior to the end of the Priority Revolving Availability Period)".
SECTION 3A. AMENDMENT TO ARTICLE III. Section 3.06(a)(ii) of the
Credit Agreement is hereby amended by inserting the following text immediately
after "(ii)" and before "that":
except as set forth in Schedule 3.06(a)(ii),
SECTION 4. AMENDMENT TO ARTICLE IV. The first paragraph of
Article IV is hereby amended by inserting the following text immediately
before the ":":
, PROVIDED that no amendment to or waiver of any condition set forth in
this Article IV, any representation or warranty or covenant contained in
this Agreement or any other Loan Document, or any Default or Event of
Default, shall
14
be effective for purposes of determining whether the conditions precedent
set forth hereunder to the making of any Priority Revolving Loan have been
satisfied unless the Required Priority Revolving Lenders shall have
consented to such amendment or waiver
SECTION 5. AMENDMENTS TO ARTICLE V. (a) Section 5.11(b) of the Credit
Agreement is hereby amended by replacing the text "Revolving Loans" with the
text "Existing Revolving Loans".
(b) Section 5.11 of the Credit Agreement is hereby amended by adding
a new paragraph (e) with the following text:
(e) The proceeds of Priority Revolving Loans will be used by the
Borrower for general corporate purposes.
SECTION 6. AMENDMENTS TO ARTICLE VI. (a) Section 6.01(a) of the
Credit Agreement is hereby amended by deleting the "and" from clause (xii),
adding an "and" to the end of clause (xiii) and adding a new clause (xiv) as
follows, immediately before the "." at the end of such Section:
(xiv) Indebtedness incurred by Holdings in the form of Additional Holdings
Notes, PROVIDED that the aggregate principal amount of all Additional
Holdings Notes issued by Holdings pursuant to this paragraph (xiv) shall
not exceed $50,000,000 (plus the aggregate principal amount accreted on
such Additional Holdings Notes after their respective dates of issuance in
accordance with their terms and the aggregate principal amount of
Additional Holdings Notes of Holdings issued to repay or repurchase
Additional Holdings Notes of Holdings previously issued pursuant to this
paragraph (xiv) in accordance with Section 6.08(b))
(b) Section 6.01(b) of the Credit Agreement is hereby amended by
replacing the "and" at the end of clause (iv) with the text "," and adding the
following text immediately after clause (v):
and (vi) Indebtedness incurred by Holdings pursuant to Section
6.01(a)(xiv).
(c) Section 6.01(c) of the Credit Agreement is hereby amended by
adding the following text immediately before the "." at the end of such Section:
,except that Holdings may issue preferred stock that is not Disqualified
Stock , PROVIDED that, at any time, the sum of (i) the aggregate
liquidation preference of all
15
preferred stock issued by Holdings pursuant to this paragraph (c) and
outstanding at such time and (ii) the aggregate principal amount of all
Additional Holdings Notes issued by Holdings pursuant to paragraph (xiv) of
Section 6.01(a) and outstanding at such time shall not exceed $50,000,000
(plus (A) an amount reflecting any discount for any preferred stock issued
by Holdings pursuant to this paragraph (c) and outstanding at such time, or
any discount for any Additional Holdings Notes issued by Holdings pursuant
to Section 6.01(a)(xiv) and outstanding at such time, that was determined
in good faith by Holdings to reflect the market discount for such preferred
stock or Additional Holdings Notes, as the case may be, at the time of
issuance, (B) an amount reflecting any premium paid in connection with any
payment, purchase, repurchase, retirement, defeasance or other acquisition
or retirement for value of preferred stock of Holdings or Additional
Holdings Notes in accordance with the terms of such preferred stock or
Additional Holdings Notes, as the case may be, if such premium was
determined in good faith by Holdings at the time of issuance of such
preferred stock or Additional Holdings Notes, as the case may be, to be a
market premium and (C) the aggregate principal amount of Additional
Holdings Notes accreted on Additional Holdings Notes previously issued by
Holdings pursuant to paragraph (xiv) of Section 6.01(a) and the aggregate
liquidation preference of preferred stock of Holdings issued by Holdings in
payment of (or to fund (including as part of the purchase or redemption
price for preferred stock) the payment of) dividends on preferred stock
previously issued by Holdings pursuant to this paragraph (c), in each case
under this clause (C) after the respective dates of issuance of such
Additional Holdings Notes or preferred stock (as applicable) in accordance
with their respective terms)
(d) Section 6.04 of the Credit Agreement is hereby amended by
inserting at the end of such Section the following new text:
Notwithstanding the foregoing, the Borrower will not, and will
not permit any of the Subsidiaries to, (a) during the period beginning on
October 15, 2001, and ending on the date that is one year after the
Amendment No. 2 Effective Date, effect investments constituting Permitted
Acquisitions in excess of an aggregate amount of $2,500,000 (determined on
the basis set forth in paragraph (i) of this Section 6.04) and (b) during
the period beginning on October 15, 2001, and ending on the later of (x)
December 31, 2003, and (y) the last day of the fiscal year of the Borrower
during which the Priority Revolving Commitments are terminated, effect
investments constituting Permitted Acquisitions in excess of an aggregate
amount of $10,000,000 (determined on the basis set forth in paragraph (i)
of this Section 6.04).
(e) Section 6.08(a) of the Credit Agreement is hereby amended by
inserting at the end of clause (ii) the following new text:
16
or its preferred stock, to the extent such preferred stock is permitted to
be issued pursuant to Section 6.01(c)
by amending and restating clause (vii) in its entirety as follows:
(vii) any purchase, repurchase, retirement, defeasance or other
acquisition or retirement for value of Equity Interests of Holdings
(including Equity Interests issued by Holdings pursuant to the New Equity
Contribution or Future New Equity Contribution) made by exchange for, or
out of the proceeds of the substantially concurrent sale of, (A) Equity
Interests of Holdings (other than Equity Interests issued pursuant to the
New Equity Contribution or the Future New Equity Contribution and
Disqualified Stock and Equity Interests issued or sold to the Borrower or
a Subsidiary or an employee stock ownership plan or other trust
established by the Borrower or any of the Subsidiaries) or (B) Additional
Holdings Notes issued by Holdings pursuant to Section 6.01(a)(xiv),
PROVIDED that the consideration paid by Holdings for each purchase,
repurchase, retirement, defeasance or other acquisition or retirement for
value of Equity Interests other than common stock of Holdings pursuant to
this clause (vii) shall not exceed the gross cash proceeds (which shall be
deemed to include the aggregate principal amount of Indebtedness of the
Borrower that was held by the Sponsor or any Affiliate thereof and was
incurred pursuant to Section 6.01(a)(xi) and then canceled or otherwise
forgiven solely in exchange for the issuance by Holdings of preferred
stock and warrants pursuant to the New Equity Contribution) received by
Holdings as the consideration for the issuance by it of the Equity
Interests to be purchased, repurchased, retired, defeased or otherwise
acquired or retired for value (plus any amounts that are referred to in
subclauses (A), (B) and (C) of Section 6.01(c) that are specifically
applicable with respect to the preferred stock to be purchased,
repurchased, retired, defeased or otherwise acquired or retired for
value), PROVIDED FURTHER that no purchase, repurchase, retirement,
defeasance or other acquisition or retirement for value of common stock of
Holdings will be made by exchange for, or out of the proceeds of the sale
of, preferred stock of Holdings or Additional Holdings Notes;
and deleting "and" at the end of clause (vii) thereof and inserting the
following immediately before the "." at the end of such Section:
; and (ix) the Borrower may at any time after the date that is five years
after the date of issuance by Holdings of any Additional Holdings Notes
pursuant to Section 6.01(a)(xiv), provided that no Default or Event of
Default has occurred and is continuing or will occur as a result of such
payment and to the extent permitted by the Subordinated Debt Documents and
the Existing Notes Debenture in each case as in effect on the date hereof,
pay dividends to Holdings when and to
17
the extent necessary to fund payments of interest accrued and payable on
such Additional Holdings Notes;
(f) Section 6.08(b) of the Credit Agreement is hereby amended (i) by
inserting the following immediately prior to the ";" at the end of paragraph
(iv) of such Section:
and (C) payments in cash in respect of interest on any Additional Holdings
Notes issued pursuant to Section 6.01(a)(xiv) prior to the date that is
five years after the date of issuance of such Additional Holdings Notes;
, and (ii) by deleting "and" at the end of paragraph (v) of such Section and
inserting at the end of paragraph (vi) immediately before the "." new paragraphs
(vii) and (viii) as follows:
(vii) payment of Indebtedness incurred under Section
6.01(a)(xiv) made by exchange for, or out of proceeds of the substantially
concurrent sale of, (A) Equity Interests of Holdings (other than
Disqualified Stock and other than Equity Interests issued or sold to the
Borrower or a Subsidiary or an employee stock ownership plan or other
trust established by the Borrower or any of the Subsidiaries) or (B) other
Indebtedness incurred under Section 6.01(a)(xiv) for the purpose of
refinancing such Indebtedness, PROVIDED that the consideration paid by
Holdings for each payment of Additional Holdings Notes pursuant to this
clause (vii) shall not exceed the gross cash proceeds received by Holdings
as the consideration for the issuance by it of the Additional Holdings
Notes to be paid (plus any amounts that are referred to in subclauses (A),
(B) and (C) of Section 6.01(c) that are specifically applicable with
respect to the Additional Holdings Notes to be paid); and
(viii) the payment of Indebtedness incurred pursuant to Section
6.01(a)(xi) through the issuance by Holdings of preferred stock of
Holdings in exchange for the cancelation or other forgiveness of such
Indebtedness pursuant to the parenthetical in the definition of the term
"New Equity Contribution".
(g) Section 6.09 of the Credit Agreement is hereby amended by
deleting the last "and" from clause (h), adding an "and" to the end of clause
(i) and adding a new clause (j) as follows, immediately before the "." at the
end of such Section.
(j) The issuance by Holdings of pay-in-kind participating
preferred stock and warrants (including in exchange for the cancelation or
other forgiveness of Indebtedness incurred pursuant to Section
6.01(a)(xi)) pursuant to the New Equity Contribution or the Future New
Equity Contribution.
18
(h) Section 6.12 of the Credit Agreement is hereby amended by
replacing the table therein with the following:
PERIOD: RATIO:
------- ------
4th fiscal quarter 2001 1.10 to 1.00
1st fiscal quarter 2002 1.10 to 1.00
2nd fiscal quarter 2002 1.10 to 1.00
3rd fiscal quarter 2002 1.10 to 1.00
4th fiscal quarter 2002 1.10 to 1.00
1st fiscal quarter 2003 1.10 to 1.00
2nd fiscal quarter 2003 1.10 to 1.00
3rd fiscal quarter 2003 1.25 to 1.00
4th fiscal quarter 2003 1.25 to 1.00
1st fiscal quarter 2004 1.50 to 1.00
2nd fiscal quarter 2004 1.50 to 1.00
3rd fiscal quarter 2004 1.75 to 1.00
4th fiscal quarter 2004 1.75 to 1.00
1st fiscal quarter 2005 2.00 to 1.00
2nd fiscal quarter 2005 2.00 to 1.00
3rd fiscal quarter 2005 2.20 to 1.00
4th fiscal quarter 2005 2.20 to 1.00
1st fiscal quarter 2006 2.40 to 1.00
2nd fiscal quarter 2006 2.40 to 1.00
3rd fiscal quarter 2006 2.40 to 1.00
4th fiscal quarter 2006 2.40 to 1.00
1st fiscal quarter 2007 3.00 to 1.00
2nd fiscal quarter 2007 3.00 to 1.00
3rd fiscal quarter 2007 3.25 to 1.00
4th fiscal quarter 2007 3.25 to 1.00
1st fiscal quarter 2008, and thereafter 3.50 to 1.00
(i) Section 6.13 of the Credit Agreement is hereby amended by
replacing the table therein with the following:
19
PERIOD: RATIO:
------- ------
4th fiscal quarter 2001 9.90 to 1.00
1st fiscal quarter 2002 9.90 to 1.00
2nd fiscal quarter 2002 9.90 to 1.00
3rd fiscal quarter 2002 9.90 to 1.00
4th fiscal quarter 2002 9.90 to 1.00
1st fiscal quarter 2003 9.00 to 1.00
2nd fiscal quarter 2003 8.00 to 1.00
3rd fiscal quarter 2003 7.50 to 1.00
4th fiscal quarter 2003 7.00 to 1.00
1st fiscal quarter 2004 6.25 to 1.00
2nd fiscal quarter 2004 5.75 to 1.00
3rd fiscal quarter 2004 5.50 to 1.00
4th fiscal quarter 2004 5.25 to 1.00
1st fiscal quarter 2005 4.75 to 1.00
2nd fiscal quarter 2005 4.75 to 1.00
3rd fiscal quarter 2005 4.50 to 1.00
4th fiscal quarter 2005 4.25 to 1.00
1st fiscal quarter 2006 4.00 to 1.00
2nd fiscal quarter 2006 4.00 to 1.00
3rd fiscal quarter 2006 3.60 to 1.00
4th fiscal quarter 2006 3.60 to 1.00
1st fiscal quarter 2007 3.00 to 1.00
2nd fiscal quarter 2007 3.00 to 1.00
3rd fiscal quarter 2007 2.75 to 1.00
4th fiscal quarter 2007 2.75 to 1.00
1st fiscal quarter 2008, and thereafter 2.75 to 1.00
(j) Section 6.14 of the Credit Agreement is hereby amended by
replacing the table therein with the following:
PERIOD: RATIO:
------- ------
4th fiscal quarter 2001 6.00 to 1.00
20
PERIOD: RATIO:
------- ------
1st fiscal quarter 2002 6.00 to 1.00
2nd fiscal quarter 2002 6.00 to 1.00
3rd fiscal quarter 2002 6.00 to 1.00
4th fiscal quarter 2002 6.00 to 1.00
1st fiscal quarter 2003 5.50 to 1.00
2nd fiscal quarter 2003 5.00 to 1.00
3rd fiscal quarter 2003 4.75 to 1.00
4th fiscal quarter 2003 4.25 to 1.00
1st fiscal quarter 2004 3.75 to 1.00
2nd fiscal quarter 2004 3.50 to 1.00
3rd fiscal quarter 2004 3.25 to 1.00
4th fiscal quarter 2004 3.00 to 1.00
1st fiscal quarter 2005 2.75 to 1.00
2nd fiscal quarter 2005 2.75 to 1.00
3rd fiscal quarter 2005 2.60 to 1.00
4th fiscal quarter 2005 2.60 to 1.00
1st fiscal quarter 2006 2.40 to 1.00
2nd fiscal quarter 2006 2.40 to 1.00
3rd fiscal quarter 2006 2.25 to 1.00
4th fiscal quarter 2006 2.25 to 1.00
1st fiscal quarter 2007, and thereafter 1.75 to 1.00
(k) Section 6.15 of the Credit Agreement is hereby amended by (i)
replacing all the text immediately following the text "the Subsidiaries in" and
prior to the text ", PROVIDED" in paragraph (a) with the following text:
(i) the former fiscal years of the Borrower ending on or about
October 31, 2000, or October 31, 2001, to exceed $15,000,000, (ii) the
months of November 2001 and December 2001, to exceed, in aggregate,
$3,000,000, (iii) any fiscal year of the Borrower ending on or about
December 31, 2002, or December 31, 2003 to exceed $15,000,000, and (iv)
any fiscal year of the Borrower ending thereafter to exceed $15,000,000
21
(ii) replacing the text "and" immediately before the text "(ii)" in paragraph
(b) with a "," and inserting the text ", and (iii) in the case of the fiscal
years of the Borrower ending on or about December 31, 2003, and December 31,
2004, only, $5,000,000" immediately before the "." .
(l) Section 6.16 of the Credit Agreement is hereby amended by adding
to the end of such Section a new sentence as follows:
Commencing on the Amendment No. 2 Effective Date, (a) each fiscal
year for the Borrower and the Subsidiaries shall end on December 31 and
(b) the fiscal quarters for the Borrower and the Subsidiaries shall end on
March 31, June 30 , September 30 and December 31.
SECTION 7. NEW SCHEDULES. The Credit Agreement is hereby amended by
inserting a new Schedule 1.01(d) in the form set out in Annex A hereto,
inserting a new Schedule 2.01A in the form set out in Annex B hereto and
inserting a new Schedule 3.06(a)(ii) in the form set out in Annex C hereto.
SECTION 8. EVENT OF DEFAULT. The parties agree that, without limiting
any provision contained in Article VII of the Credit Agreement, an Event of
Default shall occur if, at or before 3:00 p.m. New York City time, on December
31, 2001, the Future New Equity Contribution has not been completed.
SECTION 9. FEES. In consideration of the agreements of the Required
Lenders contained in this Amendment, the Borrower agrees to pay to the
Administrative Agent, (a) for the account of each Lender that delivers an
executed counterpart of this Amendment by 12:00 noon, New York City time, on
November 16, 2001 and affirms such delivery by 12:00 noon, New York City time,
on November 30, 2001, a one-time amendment fee (the "Amendment Fee") in an
amount equal to 0.50% of the sum of such Lender's Revolving Commitment (prior to
giving effect to this Amendment) and the aggregate principal amount of such
Lender's Term Loans, in each case on such date, (b) for the account of each
Priority Revolving Lender a one-time commitment fee (the "Priority Commitment
Fee") in an amount equal to 2.00% of such Lender's Priority Revolving Commitment
on such date and (c) for the account of each Priority Revolving Lender a
one-time funding fee (the "Priority Funding Fee") in an amount equal to 1.00% of
such Lender's Priority Commitment which shall be payable to the Borrower upon
the making of the initial drawing on the Priority Revolving Facility, PROVIDED
that the Amendment Fee, the Priority Commitment Fee and the Priority Funding Fee
shall not be payable unless and until this Amendment becomes effective as
provided in Section 10 below.
22
SECTION 10. REPRESENTATIONS AND WARRANTIES. Each of Holdings and
the Borrower represents and warrants to the Administrative Agent, to the
Issuing Bank and to each of the Lenders that:
(a) This Amendment has been duly authorized, executed and delivered
by Holdings and the Borrower and constitutes their legal, valid and
binding obligation, enforceable in accordance with its terms subject, in
each case, to the approval of the special committee of the board of
directors of Holdings, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors'
rights generally and by general principles of equity (regardless of
whether the same is considered in a proceeding at law or in equity).
(b) The representations and warranties of each Loan Party set forth
in the Loan Documents are true and correct in all material respects on and
as of the date hereof, except to the extent such representations and
warranties expressly relate to an earlier date, in which case such
representations and warranties, shall, to such extent, be true and correct
in all material respects as of such earlier date.
(c) On the date hereof and immediately after giving effect to this
Amendment, no Default has occurred and is continuing.
SECTION 11. CONDITIONS TO EFFECTIVENESS. This Amendment shall become
effective as of the date first above written when (A) the Administrative Agent
shall have received (a) counterparts of this Amendment that, when taken
together, bear the signatures of (i) the Borrower, (ii) Holdings, (iii) the
Required Lenders and (iv) each Lender that will provide a Priority Revolving
Commitment (as set forth on Annex B hereto), (b) the Amendment Fees and Priority
Commitment Fees and any fees separately agreed upon by the Administrative Agent
and the Borrower, (c) evidence satisfactory to the Administrative Agent that the
New Equity Contribution has been consummated, (d) a favorable written opinion
(addressed to the Administrative Agent and the Lenders and dated the Amendment
No.2 Effective Date) of each of (i) Wachtell, Lipton, ▇▇▇▇▇ & ▇▇▇▇, counsel for
Holdings and the Borrower, (ii) if the Administrative Agent reasonably requests,
▇▇▇▇▇ ▇▇▇▇▇ L.L.P., Texas counsel for Holdings, and (iii) if the Administrative
Agent reasonably requests, in-house counsel for Holdings and the Borrower,
covering such matters relating to the Loan Parties, this Amendment and the
transactions contemplated thereby as the Required Lenders may reasonably
request, (e) any amendments to the Security Documents as the Administrative
Agent may reasonably request, and in form and substance acceptable to the
Administrative Agent, (f) evidence reasonably satisfactory to the Administrative
Agent of the approval of the execution, delivery and performance of this
Amendment and the transactions contemplated hereby by the special committee of
the board of directors of Holdings, (g) evidence reasonably satisfactory to the
Administrative Agent that the Pre-Contribution Transactions (as defined below)
have been consummated, and (h) such documents and certificates as the
23
Administrative Agent may reasonably request relating to the organization,
existence and good standing of each Loan Party, the authorization of this
Amendment and the transactions contemplated hereby to occur on the Amendment No.
2 Effective Date or subsequent thereto pursuant to the Pre-Contribution
Transactions and any other related legal matters, all in form and substance
satisfactory to the Administrative Agent and its counsel, and (B) Holdings and
the Borrower shall have received evidence reasonably satisfactory to them that
the initial aggregate amount of Priority Revolving Commitments is $20,000,000.
Holdings and the Borrower may waive the condition set forth in Section 11(B)
above and, upon such waiver, this Amendment shall become effective upon the
satisfaction of the conditions set forth in Section 11(A) above.
For the purposes of this Section only, "PRE-CONTRIBUTION TRANSACTIONS" means (a)
the due execution and delivery of an agreement or agreements, in form and
substance reasonably satisfactory to the Administrative Agent, among a special
purpose, bankruptcy remote Affiliate of Fox ▇▇▇▇▇ Capital Fund L.P. reasonably
satisfactory to the Administrative Agent (the"Contributor"), Holdings and the
Borrower (and identifying the Administrative Agent as a third-party beneficiary)
pursuant to which if, by 3:00 p.m., New York City time, on December 31, 2001,
Holdings has not received the aggregate gross cash proceeds required to be
payable to it pursuant to the Future New Equity Contribution, then at such time
(unless a Trigger Event shall have occurred at or prior to such time) (i) the
Contributor will automatically be deemed to have purchased from Holdings, and
Holdings will automatically be deemed to issue to the Contributor, without any
further action on the part of any Person, pay-in-kind participating preferred
stock of Holdings and warrants to acquire common stock of Holdings, in each case
in accordance with the definition of the term "Future New Equity Contribution",
for aggregate gross cash proceeds in an amount (such amount, the "Required
Amount") sufficient to cause the Future New Equity Contribution to be completed,
and (ii) cash contained in the Cash Collateral Account (as defined below) in the
Required Amount will be released to the Borrower and such release will be deemed
to constitute payment to Holdings of the purchase price for the preferred stock
and warrants so issued or deemed issued pursuant to the Future New Equity
Contribution and the contribution by Holdings of such cash to the Borrower as
common equity, (b) the deposit by the Contributor of cash in an aggregate amount
equal to the Maximum Required Amount (as defined within the definition of the
term "Future New Equity Contribution") into an account held at The Chase
Manhattan Bank in the name of The Chase Manhattan Bank (the "Cash Collateral
Account") and (c) the due execution and delivery by the Contributor, Holdings
and the Borrower of such documentation as is requested by the Administrative
Agent, in form and substance reasonably satisfactory to the Administrative
Agent, to provide for the grant of a security interest to the Collateral Agent
in the Cash Collateral Account and all funds deposited therein to secure (i) the
purchase obligations of the Contributor under clause (a) above and (ii) the
Obligations in an amount equal to the Required Amount from time to time, which
documentation will
24
expressly permit the Collateral Agent to apply such funds toward payment of the
Obligations upon the occurrence of any Default under paragraph (h) or (i) of
Article VII of the Credit Agreement or any acceleration of the maturity of the
Obligations pursuant to Article VII of the Credit Agreement (any such Default or
acceleration, a "Trigger Event").
SECTION 12. CREDIT AGREEMENT. Except as specifically modified hereby,
the Credit Agreement shall continue in full force and effect in accordance with
the provisions thereof as in existence on the date hereof. After the date
hereof, any reference to the Credit Agreement shall mean the Credit Agreement as
modified hereby.
SECTION 13. RELEASE. Holdings and the Borrower each hereby forever
releases, discharges and holds harmless the Administrative Agent and each
Lender, and each Affiliate of any of the foregoing Persons, and the financial
and legal advisors, directors, trustees, partners, members, employees, agents
and advisors of any of the foregoing (any such person, a "Releasee"), from any
and all losses, claims, damages, demands, debts, liabilities, expenses,
obligations, actions, causes of action, suits, sums of money, accounts,
reckonings, covenants, contracts, controversies, agreements, promises and rights
whatsoever, whenever arising, out of actions or omissions occurring prior to the
effectiveness of this Amendment, whether arising under the Credit Agreement or
the other Loan Documents, any Loan or Commitment or the use of the proceeds
thereof, or any other agreements, instruments, engagements, conversations or
transactions contemplated by or relating to any of the foregoing, known or
unknown, suspected or unsuspected, contingent or fixed, liquidated or
unliquidated, matured or unmatured, in law, equity or otherwise that Holdings or
the Borrower ever had, now have, or hereafter can, shall or may have against any
of the Releasees for, upon, or by reason of any matter, cause, transaction or
thing whatsoever occurring at any time prior to the effectiveness of this
release.
SECTION 14. WAIVER. The Required Lenders hereby waive any Default or
Event of Default that may have arisen as a result of the failure by the Borrower
and Holdings to comply with Sections 6.12, 6.13 and 6.14 of the Credit Agreement
(prior to giving effect to this Amendment) with respect to the Test Period
ending on or about October 31, 2001.
SECTION 15. APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 16. COUNTERPARTS. This Amendment may be executed in two or
more counterparts, each of which shall constitute an original but all of which
when taken together shall constitute but one agreement. Delivery of an executed
signature page to this Amendment by facsimile transmission shall be effective as
delivery of a manually signed counterpart of this Amendment.
25
SECTION 17. EXPENSES. The Borrower agrees to reimburse the
Administrative Agent for its out-of-pocket expenses in connection with this
Amendment, including the reasonable fees, charges and disbursements of Cravath,
Swaine & ▇▇▇▇▇, counsel for the Administrative Agent.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed by their respective authorized officers as of the day and year
first written above.
MAXXIM MEDICAL, INC.,
by /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice Chairman & CFO
MAXXIM MEDICAL GROUP, INC.,
by /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice Chairman & CFO
THE CHASE MANHATTAN BANK, individually and
as Administrative Agent, Collateral Agent
and Issuing Bank,
by /s/ ▇▇▇▇ ▇▇▇ ▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇▇▇ ▇▇▇
Title: Vice President
BANKERS TRUST COMPANY, individually and as
Co-Syndication Agent,
by /s/ ▇▇▇▇ ▇▇ ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇▇ ▇▇▇▇▇
Title: Assistant Vice President
▇▇▇▇▇▇▇ ▇▇▇▇▇ CAPITAL CORPORATION,
individually and as Co-Syndication Agent,
by /s/ ▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇
Title: Vice President
CANADIAN IMPERIAL BANK OF COMMERCE,
individually and as Co-Documentation Agent,
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Executive Director
CREDIT SUISSE FIRST BOSTON, individually and
as Co-Documentation Agent,
by /s/ ▇▇▇▇▇▇ ▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title:Director
by /s/ ▇▇▇▇ ▇'▇▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇'▇▇▇▇
Title: Vice President
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ The Bank of New York
------------------------------------------
Name of Institution
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ Franklin Floating Rate Trust
------------------------------------------
Name of Institution
by /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER [15], 2001
To Approve the
Amendment and Waiver:
/s/ Bank One
------------------------------------------
Name of Institution
by /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: First Vice President
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ Fuji Bank, Limited
------------------------------------------
Name of Institution
by /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: VP and Manager
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Name of Institution: Scotiabanc Inc
by
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER [ ], 2001
To Approve the
Amendment and Waiver:
/s/ CIBC INC.
------------------------------------------
Name of Institution
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Executive Director
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ PB CAPITAL CORPORATION
------------------------------------------
Name of Institution
by /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇
Associate
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------
Name of Institution: MOUNTAIN CAPITAL
CLO II LTD
by
----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Director
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ ▇▇▇▇▇ ▇▇▇ & ▇▇▇▇▇▇▇ Incorporated,
As Agent for Keyport Life Insurance
Company
------------------------------------------
Name of Institution
by /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Sr. Vice President &
Portfolio Manager
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ FIRST SOURCE LOAN OBLIGATIONS INSURED
TRUST
------------------------------------------
Name of Institution
by /s/ FIRST SOURCE FINANCIAL, INC.,
its SERVICER AND ADMINISTRATOR
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Senior Vice President &
General Counsel
SIGNATURE PAGE TO
AMENDMENT NO. 2 AND WAIVER
DATED AS OF NOVEMBER 14, 2001
To Approve the
Amendment:
/s/ M.E. ▇▇▇▇▇▇▇
FOOTHILL INCOME TRUST II., L.P.
------------------------------------------
Name of Institution
by /s/ FIT II GP, LLC, its General Partner
----------------------------------------
Name: M.E. ▇▇▇▇▇▇▇
Title: Managing Member