SECOND AMENDMENT TO CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (the
"Amendment"), dated as of January 31, 1997, is among ▇▇▇▇▇
INDUSTRIES, INC., a Delaware corporation ("Borrower"), each
of the banks or other lending institutions which is or may
from time to time become a signatory thereto or any
successor or assign thereof (individually, a "Bank" and,
collectively, the "Banks"), TEXAS COMMERCE BANK NATIONAL
ASSOCIATION, a national banking association, as an issuing
bank (in such capacity, together with its successors, any
other Banks or any of their respective Affiliates acting in
such capacity, an "Issuing Bank") and as administrative
agent for itself, the Issuing Banks and the other Banks (in
such capacity, together with its successors in such
capacity, the "Agent").
RECITALS:
A. Borrower, the Agent, the Issuing Banks and the
Banks have entered into that certain Credit Agreement dated
as of August 29, 1995, as amended by that certain First
Amendment to Credit Agreement dated as of March 22, 1996
(such Credit Agreement, as the same has been and may be
amended or modified from time to time, is hereinafter
referred to as the "Agreement").
B. Borrower is a party to the following factoring
agreements (collectively, the "Existing Factoring
Agreements"): (i) that certain Factoring Agreement dated
January 8, 1991, between CIT Group/Factoring, Inc. ("CIT")
and Borrower relating to the factoring of the accounts
receivable of Borrower"s Base Line Design division, and (ii)
that certain Amended and Restated Retail - Domestic
Collection Factoring Agreement, between ▇▇▇▇▇▇ Financial,
Inc. ("▇▇▇▇▇▇") and Borrower (the "▇▇▇▇▇▇ Agreement")
relating to the factoring of the accounts receivable of
Borrower's Comfort Clinic division.
C. Borrower has advised the Agent that it desires
to enter into a new factoring agreement with CIT relating to
the factoring of the accounts receivable of Borrower's Base
Line Design division and Borrower's Comfort Clinic division,
in replacement of the Existing Factoring Agreements.
D. Borrower, the Agent, the Issuing Banks and the
Banks now desire to enter into this Amendment to amend the
definition of CIT Factoring Agreement and as otherwise
herein set forth.
NOW, THEREFORE, in consideration of the
premises herein contained and other good and valuable
consideration, the receipt and sufficiency of which are
hereby ackknowledged, the parties hereto agree as follows:
ARTICLE I
Definitions
Section 1.1. Definitions. Capitalized terms
used in the Amendment, to the extent not otherwise defined
herein, shall have the same meanings as set forth in the
Agreement, as amended hereby.
ARTICLE II
Amendments
Section 2.1. Amendment to Definition of CIT
Factoring Agreement. Effective as of the date hereof, the
parenthetical appearing at the end of Section 7.1(11) of the
Agreement is hereby deleted and the definition of "CIT
Factoring Agreement" appearing in Section 1.1 of the
Agreement is hereby amended to read in its entirety as
follows:
"CIT Factoring Agreement" means that certain Notification
Factoring Agreement dated January 31, 1997, between CIT
Group/Factoring, Inc. and the Borrower, pursuant to which
the accounts receivable of the Borrower's Base Line Design
division and the Borrower's Comfort Clinic division (and
no other accounts receivable) will be factored; provided
that each reference herein to the CIT Factoring Agreement
shall also mean that certain Amended and Restarted Retail
- Domestic Collection Factoring Agreement between ▇▇▇▇▇▇
Financial, Inc. and Borrower (a) during a transition
period until March 2 1997, to the extent accounts
receivable of the Borrower's Comfort Clinic division
continue to be factored thereunder during such transition
period, and (b) thereafter to the
extent outstanding accounts receivable of the Borrower's
Comfort Clinic division continue to be collected thereunder.
Section 2.2 Amendment to Schedule 2. Effective as of
the date hereof, item 1 of Schedule 2 to the Agreement is
hereby amended to read in its entirety as follows:
1. The CIT Factoring Agreement (as defined in the Credit
Agreement to which this is a Schedule).
Section 2.3 Books and Records. Effective as of the
date hereof, Section 9.7 of the Agreement is hereby
amended to add the following sentence to the end thereof,
which sentence shall read in its entirety as follows:
The Borrower shall invoice the accounts of its Base Line
Design division and Comfort Clinic division separately
from its other accounts which are not factored and shall
maintain books and records for such Base Line Design
division and Comfort Clinic division separately from
Borrower's other books and records.
ARTICLE III
Conditions Precedent
Section 3.1. Conditions. The effectiveness of this
Amendment is subject to the satisfaction of the following
conditions precedent:
(a) The Agent shall have received all of the
following, in form and substance satisfactory to the Agent:
(1) CIT Factoring
Agreement. A true, correct and complete copy of the CIT
Factoring Agreement;
(2) Termination of Existing Factoring
Agreements. Evidence that the Existing Factoring Agreements
are terminated and replaced with the CIT Factoring
Agreement, provided that with respect to the ▇▇▇▇▇▇
Agreement this condition will be satisfied if Agent is
provided with a copy of the notice of termination delivered
by the Borrower to ▇▇▇▇▇▇; and
(3) Additional Information. Such additional
documents, instruments and information as the Agent or its
legal counsel, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Munick P.C., may
reasonably request.
(b) The representations and warranties
contained herein and in all other Loan Documents, as amended
hereby, shall be true and correct as of the date hereof as
if made on the date hereof, except for those representations
and warranties that are expressly made as of a specific date.
(c) No Default shall have occurred and be
continuing.
(d) All; corporate proceedings taken in connection
with the transactions contemplated by this Amendment
and all documents, instruments, and other legal matters incident
thereto shall be reasonably satisfactory to the Agent and its
legal counsel, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ P.C.
ARTICLE IV
Ratifications, Representations and Warranties
Section 4.1. Ratifications. The terms and
provisions set forth in this Amendment shall modify and
supersede all inconsistent terms and provisions set forth in
the Agreement and except as expressly modified and
superseded by the Amendment, the terms and provisions of the
Agreement and the other Loan Documents are ratified and
confirmed and shall continue in full force and effect.
Borrower, the
Agent, the Banks and the Issuing Banks agree that the
Agreement as amended hereby and the other Loan Documents
shall continue in full force and effect. Borrower,
the Agent, the Banks and the Issuing Banks agree that the
Agreement as amended hereby and the other Loan Documents
shall continue to be legal, valid, binding and enforceable
in accordance with their respective terms.
Section 4.2 Representations and Warranties.
Borrower hereby represents and warrants to the Agent, the
Banks and the Issuing Banks that (i) the execution, delivery
and performance of this Amendment and any and all other Loan
Documents executed and/or delivered in connection herewith
have been authorized by all requisite corporate action on
the part of the Borrower and will not violate the articles
of incorporation or bylaws of the Borrower, (ii) the
representations and warranties contained in the agreement,
as amended hereby, and in each other Loan Document are true
and correct on and as of the date hereof as though made on
and as of the date hereof, (iii) no Default has occurred and
is continuing, and (iv) Borrower is in full compliance with
all covenants and agreements contained in the Agreement as
amended hereby and the other Loan Documents to which it is a
party.
ARTICLE V
Miscellaneous
Section 5.1 Survival of Representations and
Warranties. All representations and warranties made in this
Amendment or any other Loan Document including any Loan
Document furnished in connection with this Amendment shall
survive the execution and delivery of this Amendment and the
other Loan Documents, and no investigation by the Agent, any
Bank, any Issuing Bank or any closing shall affect the
representations and warranties or the right of the Agent,
the Banks and the Issuing Banks to rely upon them.
Section 5.2 Reference to Agreement. Each of
the Loan Documents, including the Agreement and any and all
other agreements, documents, or instruments now or hereafter
executed and delivered pursuant to the terms hereof or
pursuant to the terms of the Agreement as amended hereby,
are hereby amended so that any reference in such Loan
documents to the Agreement shall mean a reference to the
Agreement as amended hereby.
Section 5.3 Expenses of the Agent. As
provided in the Agreement, Borrower agrees to pay on demand
all reasonable costs and expenses incurred by the Agent in
connection with the preparation, negotiation, and executive
of this Amendment and the other Loan Documents executed
pursuant hereto and any and all amendments, modifications,
and supplements thereto, including without limitation the
costs and reasonable fees of the Agent's legal counsel, and
all costs and expenses incurred by the Agent, the Banks and
the Issuing Banks in connection with the enforcement or
preservation of any rights under the Agreement, as amended
hereby, or any other Loan Document, including without
limitation the costs and reasonable fees of legal counsel
for the Agent and the Issuing Banks and at any time
following and during the continuance of the Event of
Default, of one legal counsel to each Bank.
Section 5.4 Severability. Any provision of
this Amendment held by a court of competent jurisdiction to
be invalid or unenforceable shall not impair or invalidate
the remainder of this Amendment and the effect thereof shall
be confined to the provision so held to be invalid or
unenforceable.
SECTION 5.5. APPLICABLE LAW. THIS AMENDMENT
AND ALL OTHER LOAN DOCUMENTS EXECUTED PURSUANT HERETO SHALL
BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE IN DALLAS,
DALLAS COUNTY, TEXAS AND SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
Section 5.6. Successors and Assigns. This
Amendment is binding upon and shall inure to the benefit of
the Agent, the Banks, the Issuing Banks and Borrower and
their respective successors and assigns, except Borrower may
not assign or transfer any of its rights or obligations
hereunder with the prior written consent of the Agent and
all of the Banks.
Section 5.7. Counterparts. The Amendment
may be executed in one or more counterparts, each of which
when so executed shall be deemed to be an original, but all
of which when taken together shall constitute one and the
same instrument.
Section 5.8. Effect of Waiver. No consent
or waiver, express or implied, by the Agent and/or any of
the Banks to or for any breach of or deviation from any
covenant, condition or duty by Borrower or any obligated
party shall be deemed a consent or waiver to or of any other
breach of the same or any other covenant, condition or duty.
Section 5.9. Headings. The headings,
captions, and arrangements used in this Amendment are for
convenience only and shall not affect the interpretation of
this Amendment.
Section 5.10. ENTIRE AGREEMENT. THIS
AMENDMENT AND ALL OTHER INSTRUMENTS, DOCUMENTS AND
AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH THIS
AMENDMENT EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE
PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS,
AGREEEMENTS, REPRESENTATIONS AND UNDERSTANDINGS. WHETHER
WRITTEN OR ORAL, RELATING TO THIS AMENDMENT, AND MAY NOT BE
CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS
OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES
HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES
HERETO.
Executed as of the date first written above.
BORROWER:
▇▇▇▇▇ INDUSTRIES, INC.
By: /s/▇▇▇ DEHAVEN______________
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: VP/CFO
AGENT, ISSUING BANK AND BANKS:'
TEXAS COMMERCE BANK NATIONAL
ASSOCIATION, as Agent, as Issuing Bank
and as a Bank
By: /s/▇▇▇▇▇▇▇ LISTER__________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
FIRST INTERSTATE BANK OF CALIFORNIA
By: /s/▇▇▇▇▇▇▇ ▇. WARNER_____
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
NBD BANK
By: /s/▇▇▇▇▇▇▇ MCCAFFREY____
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
NATIONSBANK OF TEXAS, N.A.
By: /s/▇▇▇▇▇▇▇ SMITH________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇ FINANCIAL, INC.
By: /s/▇▇▇▇▇ COOK____________
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Assistant Vice President
THE BANK OF NEW YORK
By: /s/R. ▇▇▇ TOWNS__________
Name: R. ▇▇▇ ▇▇▇▇▇
Title: Vice President
SOCIETE GENERALE, SOUTHWEST AGENCY
By: /s/▇▇▇▇▇▇▇▇▇▇▇ SPELTZ__
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
The undersigned Guarantor hereby consents and agrees to
this Amendment and agrees that the Subsidiary Guaranty
shall remain in full force and effect and shall continue
to be the legal, valid and binding obligation of such
Guarantor enforceable against such Guarantor in accordance
with its terms.
GUARANTOR:
▇▇▇▇▇ AERO, INC.
By: /s/▇▇▇ DEHAVEN________
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: VP/CFO