EXHIBIT 10.5
SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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THIS SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT made as of
this 15th day of December, 2000 among PRIMESOURCE SURGICAL, INC., (the
"Borrower"), BIMECO,INC., a Florida corporation a Delaware corporation
("Bimeco"), RUBY MERGER SUB, INC., a Delaware corporation ("Ruby" and together
with Bimeco, the "Guarantors") (the Borrower and Guarantors, collectively the
"Loan Parties") and CITIZENS BANK OF MASSACHUSETTS (hereinafter referred to as
the "Bank").
WHEREAS, the Borrower, Bimeco and the Bank are parties to an Amended and
Restated Credit Agreement dated as of June 14, 1999, as amended by that certain
First Amendment to Amended and Restated Credit Agreement dated as of August 22,
2000 (the "Credit Agreement") Capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the Credit Agreement. The Loan
parties, in order to facilitate the acquisition of two medical supply companies
by Ruby, desire (a) to amend the Credit Agreement to permit the formation of
Ruby and add Ruby as a joint and several guarantor thereunder, (b) to pledge to
the Bank all of the capital stock of Ruby, (c) to grant to the Agent a first
priority lien in all personal property and fixtures of Ruby, whether now owned
or hereafter acquired and (d) to amend the Credit Agreement in various other
respects. The Bank is willing to amend the Credit Agreement on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and other good
and valuable consideration the receipt of and sufficiency of which is hereby
acknowledged, the parties hereby amend the Credit Agreement as follows:
Section 1. DEFINITIONS.
(a) Section 1.1 of the Credit Agreement is hereby amended by deleting
the definitions "Guarantor Security Agreement," "Intellectual Property Security
Agreements" and "Unlimited Guaranty Agreements" in their entirety and
substituting therefor the following:
"GUARANTOR SECURITY AGREEMENTS" shall mean the security agreements
between the Bank and each of Bimeco, Ruby and the Internet Subsidiary (if any)
securing the obligations of the Borrower under the Credit Documents.
"INTELLECTUAL PROPERTY SECURITY AGREEMENTS" shall mean the
intellectual property security agreements between the Bank and each of Bimeco,
Ruby and the Internet Subsidiary (if any) securing the obligations of the
Borrower under the Credit Documents.
"UNLIMITED, GUARANTY AGREEMENTS" shall mean the unlimited guaranties
of Bimeco, Ruby and the Internet Subsidiary (if any) of the obligations of the
Borrower under the Credit Documents.
Section 2. AMENDMENTS OF CREDIT AGREEMENT.
(a) Article 5 of the Credit Agreement is hereby amended by deleting
5.31 in its entirety and substituting the following therefor:
"Section 5.31" Subsidiaries. The Borrower shall have no subsidiaries
other than Bimeco, Ruby and the Internet Subsidiary."
Section 3. CONSENT BY THE BANK. The Bank hereby consents to the
transactions described in the Agreement and Plan of Merger among the Borrower,
Ruby, New England Medical Specialties, Inc., Professional Equipment Co., Inc.
and the Shareholders of New England Medical Specialties, Inc. and Professional
Equipment Co., Inc. dated as of December __ 2000 (the "Merger Agreement").
Section 4. PROMISSORY NOTES. The Bank and the Loan Parties acknowledge and
agree that the $5,000,000 Amended and Restated Term Note dated as of June 14,
1999 issued by the Borrower to the Bank and the $12,000,000 Amended and Restated
Revolving Credit Note dated as of June 14, 1999 issued by the Borrower to the
Bank are hereby cancelled and replaced with the $5,000,000 Second Amended and
Restated Term Note (the "New Term Note") dated as of December __, 2000 and the
$12,000,000 Second Amended and Restated Revolving Credit Note (the "New
Revolving Credit Note") dated as of December __, 2000 in the form attached
hereto as Exhibits A and B, respectively. The New Term Note shall evidence all
amounts owed by the Borrower to the Bank with respect to the Term Credit. The
New Revolving Credit Note shall evidence all amount owed by the Borrower to the
Bank with respect to Revolving Credit Advances.
Section 5. MERGER AGREEMENT. On or before January 5, 2000, the Loan Parties
shall have delivered to the Bank an executed officer's certificate in form and
substance satisfactory to the Bank confirming the consummation of the Merger
Agreement. Failure to deliver such officer's certificate on or before January 5,
2000 shall constitute an Event of Default under the Credit Agreement.
Section 6. EFFECTIVENESS: CONDITIONS TO EFFECTIVENESS OF SECOND AMENDMENT.
This Second Amendment to the Credit Agreement shall become effective upon
satisfaction of the following conditions:
(a) SECOND AMENDMENT. The Loan Parties shall have delivered to the
Bank and executed Second Amendment to the Credit Agreement.
(b) PROMISSORY NOTES. The Loan Parties shall have delivered to the
Bank an executed New Term Note and New Revolving Credit Note.
(c) RUBY UNLIMITED GUARANTY. Ruby shall have executed an Unlimited
Guaranty in form and substance satisfactory to the Bank of the Obligations which
shall have been delivered to the Bank.
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(d) RUBY SECURITY AGREEMENT. Ruby shall have executed a Security
Agreement in form and substance satisfactory to the Bank granting a
first-priority lien to the Bank to secure Ruby's obligations under its Unlimited
Guaranty
(e) RUBY INTELLECTUAL PROPERTY SECURITY AGREEMENT. Ruby shall have
executed an Intellectual Property Security Agreement in form and substance
satisfactory to the Bank granting the Bank a first-priority security interest in
the intellectual property of Ruby to secure Ruby's obligations under its
Unlimited Guaranty.
(f) RUBY INTERCOMPANY NOTE. Ruby shall have executed an intercompany
note in favor of the Borrower which shall have been collaterally assigned and
delivered to the Bank.
(g) PLEDGE AMENDMENT. The Borrower shall have executed an amendment to
the Pledge Agreement between the Borrower and the Bank dated as of June 14, 1999
pledging all of its interests in Ruby to the Bank.
(h) OPINION OF COUNSEL. The Loan Parties shall have delivered to the
Bank an opinion of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel to the Loan
Parties in form and substance satisfactory to the Bank.
(i) COMPLIANCE CERTIFICATE. The Loan Parties shall have delivered to
the Bank an executed pro forma Compliance Certificate (after giving effect to
the Merger Agreement) dated as of the date hereof and attached hereto as EXHIBIT
5.06(c)
(j) BORROWERING BASE CERTIFICATE. The Loan Parties shall have
delivered to the Bank an executed Borrowing Base Certificate dated as of the
date hereof and attached hereto as Exhibit 5.06(d).
(k) RESOLUTIONS. Copies of the resolutions of the Boards of Directors
of the Loan Parties authorizing the execution, delivery and performance of this
Second Amendment and any Credit Document executed in connection herewith
certified by an officer of each Loa Party (which certificate shall state that
such resolutions are in full force and effect).
(l) INCUMBENCY. Certificates of an officer of the Loan Parties,
certifying the name and signatures of the officers of the Loan Parties to sign
this Second Amendment and the other Credit Documents to be delivered on or about
the date hereof to which the Loan Parties are a party.
(m) EXISTENCE, QUALIFICATION AND GOOD STANDING CERTIFICATES.
Certificates of good standing and legal existence for the Loan Parties of recent
date issued by the governmental authority of each such Loan Party's state of
incorporation.
(n) ADDITIONAL DOCUMENTATION. Delivery to the Bank of such other
documents as the Bank or its special counsel shall reasonably require.
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Section 7. MISCELLANEOUS.
(a) The Loan Parties hereby confirm to the Bank that the
representations and warranties of the Borrower set forth in Article III of the
Credit Agreement (as amended and supplemented hereby) are true and correct as of
the date hereof, as if set forth herein in full.
(b) The Loan Parties have reviewed the provisions of this Second
Amendment and all documents executed in connection therewith or pursuant thereto
or incident or collateral hereto or thereto from time to time and there is no
Event of Default under the Credit Agreement, and no condition which, with the
passage of time or giving of notice or both, would constitute an Event of
Default thereunder.
(c) The Loan Parties agree that each of the Credit Documents shall
remain in full force and effect giving effect to this Second Amendment. The
granting of the liens and security interests under the Security Agreement and
Guarantor Security Agreements secure all of the obligations of the Loan Parties
under the Credit Documents, amended by this Second Amendment.
(d) This Second Amendment represents the entire agreement among the
parties hereto relating to this Second Amendment, and supersedes all prior
understandings and agreements among the parties relating to the subject matter
of this Second Amendment. The Loan Parties waive and release any claims they may
have against, and forever discharge, the Bank and its officers, directors,
agents, attorneys, employees, successors and assigns from any claims and causes
of action arising out of the transactions referred to or contemplated in any way
by the Credit Documents and this Second Amendment.
(e) The Loan Parties represent and warrant that the execution,
delivery or performance by the Loan Parties of any of the obligations contained
in this Second Amendment or in any Credit Document do not require the consent,
approval or authorization of any person or governmental authority or any action
by or on account of with respect to any person or governmental authority.
(f) The Loan Parties agree, jointly and severally, to pay all the
Bank's reasonable expenses in preparing, executing and delivering this Second
Amendment to Credit Agreement, and all related instruments and documents,
including, without limitation, payment upon the closing of the Second Amendment
of all reasonable fees and out-of-pocket expenses of the Bank's special counsel,
▇▇▇▇▇▇▇, Procter & ▇▇▇▇ LLP in the amount of $15,000.00.
(g) This Second Amendment to Credit Agreement shall be a Credit
Document and shall be governed by and construed and enforced under the laws of
The Commonwealth of Massachusetts without regard to principles relating to
choice of law.
(h) The Loan Parties agree that the Borrowing Base Certificate and
Compliance Certificate attached hereto as Exhibit 5.06(c) and 5.06(d) shall
supersede and replace the Borrowing Base Certificate and Compliance Certificate
referred to in the Credit Agreement.
(i) The Guarantors agree and acknowledge that the Unlimited Guaranty
Agreements (as such term in amended by this Second Amendment) shall continue to
guarantee, among other things, the prompt payment when due of all of the
Borrower's obligations to the Bank, including without limitations the
Obligations, and otherwise remain in full force and effect.
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IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment
to the Credit Agreement under seal as of the date first above written.
ORROWER:
PRIMESOURCE SURGICAL, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
GUARANTORS:
BIMECO, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
RUBY MERGER SUB, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
BANK:
CITIZENS BANK OF MASSACHUSETTS
By: illegible
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Name:
Title:
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