1
Exhibit 4.3
FIRST AMENDMENT TO CREDIT AGREEMENT
-----------------------------------
THIS FIRST AMENDMENT TO CREDIT AGREEMENT, dated as of October 19, 2000
(this "Amendment"), is among CORRPRO COMPANIES, INC., an Ohio corporation (the
"Company"), CSI COATING SYSTEMS INC. (the "Canadian Borrower" and together with
the Company, the "Borrowers"), the lenders set forth on the signature pages
hereof (collectively, the "Lenders") and BANK ONE, MICHIGAN, a Michigan banking
corporation, as LC Issuer and as agent for the Lenders (in such capacity, the
"Agent").
RECITALS
--------
A. The Borrowers, the Agent and the Lenders are parties to a Credit
Agreement dated as of June 9, 2000 (as now and hereafter amended, the "Credit
Agreement"), pursuant to which the Lenders agreed, subject to the terms and
conditions thereof, to extend credit to the Borrowers.
B. The Borrowers, the Agent and the Lenders desire to amend the Credit
Agreement strictly in accordance with the terms hereof.
TERMS
-----
In consideration of the premises and of the mutual agreements herein
contained, the parties agree as follows:
ARTICLE I.
AMENDMENTS
----------
Upon fulfillment of the conditions set forth in Article III hereof, the
Credit Agreement shall be amended as follows:
1.1 Section 1.1 shall be amended by adding the following
language at the end of the definition of "EBITDA": "plus, the value of capital
stock of the Company contributed by the Company to employee benefit plans during
the period".
1.2 Section 1.1 shall be further amended by adding a new
definition in appropriate alphabetical order:
"Net Cash Proceeds" means, without duplication, in connection
with any issuance or sale of any equity securities or debt securities
or instruments or the incurrence of loans, the cash proceeds received
from such issuance or incurrence, net of investment banking fees,
reasonable and documented attorneys' fees, accountants' fees,
underwriting discounts and commissions and other reasonable and
customary fees and expenses actually incurred in connection
therewith.
1.3 Section 2.6 shall be amended by adding a new Section
2.6.7 at the end thereof to read as follows:
2.6.7 In addition to all other payments required hereunder,
the Borrowers shall prepay the Aggregate Total Outstandings and the
Noteholder Obligations, on a pro rata basis
2
based on the Aggregate Total Outstandings under this Agreement and the
aggregate outstanding amount of Noteholder Obligations under the Senior
Note Agreement at the time of such prepayment, by an amount equal to
(a) 100% of the Net Cash Proceeds of any Subordinated Indebtedness or
similar obligation incurred at any time by any Borrower or any
Guarantor, and (b) 100% of the Net Cash Proceeds of any capital
contribution to the Company or any of its Subsidiaries (other than a
capital contribution by the Company or any Subsidiary) or issuance of
any Capital Stock of the Company (other than any issuance by the
Company in connection with any employee stock purchase plans or any
stock option plans). Such payments shall be applied to the Aggregate
Total Outstandings on a pro rata basis between the U.S. Commitment and
the Canadian Commitment, and such Commitments shall also be permanently
reduced in connection with such prepayment; provided, that the amount
of the reduction of the Commitments shall be calculated on a pro rata
basis between the Aggregate Commitments (and not on Aggregate Total
Outstandings) and the aggregate outstanding principal amount of the
Noteholder Obligations.
1.4 Section 6.19 shall be amended by deleting Sections 6.19.1
and 6.19.2 and inserting the following in place thereof:
6.19.1 CONSOLIDATED FIXED CHARGE COVERAGE RATIO. The Company
will not permit the Consolidated Fixed Charge Coverage Ratio of the
Company and its Subsidiaries, determined as of the end of each of its
fiscal quarters to be less than (i) 1.25 to 1.0 for the quarters ending
September 30, 2000 and ▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇) 1.40 to 1.0 for the
quarter ending March 31, 2001 and (iii) 1.5 to 1.0 thereafter.
6.19.2 LEVERAGE RATIO. The Company will not permit the
Consolidated Leverage Ratio of the Company and its Subsidiaries,
determined as of the end of each of its fiscal quarters, to be greater
than (i) 5.70 to 1.0 for the periods ending September 30, 2000 and
▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇) 4.50 to 1.0 for the period ending March 31,
2001, and (iii) 3.25 to 1.0 thereafter.
1.5 The Pricing Schedule attached to the Credit Agreement shall be
amended by deleting the row entitled "Eurocurrency Rate" and inserting the
following in place thereof:
----------------------------------------------------------------------------------------------------
APPLICABLE LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V LEVEL VI
MARGIN STATUS STATUS STATUS STATUS STATUS STATUS
----------------------------------------------------------------------------------------------------
Eurocurrency Rate 1.20% 1.525% 1.875% 2.05% 2.25% 2.50%
----------------------------------------------------------------------------------------------------
ARTICLE 2.
REPRESENTATIONS
---------------
Each Borrower represents and warrants to the Agent and the Lenders
that:
2.1 The execution, delivery and performance of this Amendment is within
its powers, has been duly authorized and is not in contravention with any law,
of the terms of its Articles of Incorporation or By-laws, or any undertaking to
which it is a party or by which it is bound.
-2-
3
2.2 This Amendment is the legal, valid and binding obligation of such
Borrower enforceable against it in accordance with the terms hereof.
2.3 After giving effect to the amendments herein contained, the
representations and warranties contained in Article IV of the Credit Agreement
are true on and as of the date hereof with the same force and effect as if made
on and as of the date hereof.
2.4 No Default or Unmatured Default exists or has occurred and is
continuing on the date hereof.
ARTICLE 3.
CONDITIONS OF EFFECTIVENESS
---------------------------
This Amendment shall not become effective until each of the following
has been satisfied:
3.1 This Amendment shall be signed by the Borrowers and the Lenders.
3.2 The Company and the Noteholders shall have executed an amendment to
the Senior Note Agreement, which amendment shall be satisfactory in form and
substance to the Required Lenders.
ARTICLE 4.
MISCELLANEOUS.
--------------
4.1 Notwithstanding Section 8.2 of the Credit Agreement, each of the
Lenders and the Borrowers agree that any amendment, modification or waiver of
the letter agreement dated on or about the date hereof between the Agent, on
behalf of the Lenders, and the Borrowers shall require only consent of the
Borrowers and the Required Lenders.
4.2 References in the Credit Agreement or in any note, certificate,
instrument or other document to the "Credit Agreement" shall be deemed to be
references to the Credit Agreement as amended hereby and as further amended from
time to time.
4.3 The Company agrees to pay and to save the Agent harmless for the
payment of all costs and expenses arising in connection with this Amendment,
including the reasonable fees of counsel to the Agent in connection with
preparing this Amendment and the related documents.
4.4 Except as expressly amended hereby, each Borrower agrees that the
Credit Agreement, and all documents and agreements executed by such Borrower in
connection with the Credit Agreement in favor of the Agent or any Lender are
ratified and confirmed and shall remain in full force and effect and that it has
no set off, counterclaim or defense with respect to any of the foregoing. Terms
used but not defined herein shall have the respective meanings ascribed thereto
in the Credit Agreement.
4.5 This Amendment may be signed upon any number of counterparts with
the same effect as if the signatures thereto and hereto were upon the same
instrument.
-3-
4
IN WITNESS WHEREOF, the parties signing this Amendment have caused this
Amendment to be executed and delivered as of October 19, 2000.
--
CORRPRO COMPANIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Its: Executive VP and CFO
-------------------------------
CSI COATING SYSTEMS INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Its: Vice President
-------------------------------
BANK ONE, MICHIGAN, as Agent and
Individually as a Lender
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Its: Vice President
-------------------------------
PNC BANK, NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Its: Sr. Vice President
-------------------------------
KEY BANK
By: /s/ L. ▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Its: Vice President
-------------------------------
-4-
5
FIRST MERIT BANK
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------
Its: Vice President
-------------------------------
COMERICA BANK
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------
Its: Vice President
-------------------------------
FIFTH THIRD BANK, NORTHEASTERN OHIO
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
Its: Vice President
-------------------------------