EXHIBIT 10.2
AMENDMENT NO. 4 TO FORBEARANCE AGREEMENT
This AMENDMENT NO. 4 TO FORBEARANCE AGREEMENT, dated as of May 30, 2002
(this "AMENDMENT"), is entered into among XXXXXXXXX XXXXX CORPORATION, an
Illinois corporation ("BORROWER"), XXXXXX MAY HOLDINGS, INC., a Delaware
corporation ("PARENT"), XXXXXXXXX XXXXX (CANADA) CORPORATION, a corporation
incorporated under the federal laws of Canada ("CANADIAN SUBSIDIARY" and
together with Borrower and Parent, collectively, the "CONTINUING CREDIT
PARTIES"), the lending institutions parties to the Forbearance Agreement (the
"LENDERS"), and THE CIT GROUP/BUSINESS CREDIT, INC., a New York corporation, as
Agent for the Lenders ("AGENT").
PRELIMINARY STATEMENTS:
(1) Borrower, Agent and the Lenders are parties to the Financing
Agreement, dated as of June 28, 2001 (as amended and as the same may from time
to time be further amended, restated or otherwise modified, the "FINANCING
AGREEMENT").
(2) As a result of certain defaults and events of default that occurred
under the Financing Agreement, the Continuing Credit Parties, the Lenders and
Agent entered into the Forbearance Agreement, dated as of December 31, 2001 (as
amended and as the same may from time to time be further amended, restated or
otherwise modified, the "FORBEARANCE AGREEMENT"; unless otherwise defined herein
the terms defined therein are used herein as so defined).
(3) Borrower and the Holders, as defined in the Indenture (as defined in
the Financing Agreement), of more than $140,000,000 of the aggregate outstanding
principal amount of Notes, as defined in the Financing Agreement (the "REQUIRED
NOTEHOLDERS"), have entered into the Forbearance Agreement, dated as of March 1,
2002 (as amended and as the same may from time to time be further amended,
restated or otherwise modified, the "NOTEHOLDER FORBEARANCE AGREEMENT").
(4) The Continuing Credit Parties, Agent and the Lenders desire to modify
certain terms and provisions of the Forbearance Agreement, including, without
limitation, extending the Forbearance Period.
NOW, THEREFORE, the parties hereby agree as follows:
SECTION 1. AMENDMENTS AND WAIVERS.
1.1. EXTENSION OF FORBEARANCE PERIOD. Section 2.1(a) of the Forbearance
Agreement is hereby amended to replace the date of "May 31, 2002" with "June 7,
2002".
1.2. AMENDMENT TO MAXIMUM OUTSTANDING REVOLVING LOANS AND LETTERS OF
CREDIT. Section 2.4(a)(vii) of the Forbearance Agreement is hereby amended and
restated in its entirety as follows:
and (vii) $15,000,000 on March 2, 2002 through June 7, 2002;
1.3. AMENDMENT TO BORROWING BASE CALCULATION. Section 2.4(b)(v) of the
Forbearance Agreement is hereby amended and restated in its entirety as follows:
(v) $3,000,000 shall be added to the Borrowing Base as an overadvance;
and
1.4. WAIVER OF REFINANCING REJECTION FEE. Borrower, Agent and the Lenders
hereby acknowledge that Borrower failed to deliver to Agent a fully executed and
effective Commitment Letter and to pay the Refinancing Rejection Fee as required
by Section 2.4(e) of the Forbearance Agreement (collectively, the "REFINANCING
Violation"), which Refinancing Violation constitutes a Termination Event under
the Forbearance Agreement. At Borrower's request, Agent and the Lenders hereby
waive the Termination Event that exists solely by virtue of the Refinancing
Violation.
SECTION 2. REPRESENTATIONS AND WARRANTIES.
Each Continuing Credit Party represents and warrants as follows:
2.1. AUTHORIZATION AND VALIDITY OF AMENDMENT. This Amendment has been duly
authorized by all necessary corporate action, has been duly executed and
delivered by a duly authorized officer, and constitutes the valid and binding
agreement of such Continuing Credit Party, enforceable against such Continuing
Credit Party in accordance with its terms except as enforcement thereof may be
subject to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally and general
principles of equity (regardless of whether such enforcement is sought in a
proceeding in equity or at law or otherwise).
2.2. REPRESENTATIONS AND WARRANTIES. The representations and warranties of
such Continuing Credit Party contained in the Forbearance Agreement, the
Financing Agreement and the other Loan Documents, as defined in the Financing
Agreement, are true and correct in all material respects on and as of the date
hereof, as though made on and as of the date hereof, except to the extent that
such representations and warranties expressly relate to an earlier specified
date, in which case such representations and warranties are hereby reaffirmed as
true and correct in all material respects as of the date when made.
2.3. NO EVENT OF DEFAULT. After giving effect to this Amendment, other than
the Existing Defaults, no Default or Event of Default will exist.
2.4. NO CLAIMS. There is no claim or offset against, or defense or
counterclaim to, any of the obligations or liabilities of such Continuing Credit
Party (or any of its Subsidiaries, as defined in the Financing Agreement) under
the Forbearance Agreement, the Financing Agreement or any other Loan Document.
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SECTION 3. RATIFICATIONS.
Except as expressly modified and superseded by this Amendment, the terms
and provisions of the Forbearance Agreement are ratified and confirmed and shall
continue in full force and effect.
SECTION 4. CONDITIONS TO EFFECTIVENESS.
The amendments set forth in Section 1 of this Amendment shall become
effective upon the satisfaction of the following conditions precedent:
(a) Borrower and the Required Noteholders shall have entered into a second
amendment to the Noteholder Forbearance Agreement, in the form of the attached
EXHIBIT A, on or before the date hereof;
(b) Borrower shall have paid to Agent an amendment fee in the amount of
$50,000, which shall be fully earned when paid;
(c) after giving effect to the terms of this Amendment, other than the
Existing Defaults, no other default or event of default or Termination Event
shall have occurred under the Forbearance Agreement;
(d) Xxxxxxxxx shall have paid all reasonable legal fees and expenses of
Agent in connection with this Amendment and the documents executed in connection
herewith; and
(e) the Continuing Credit Parties shall have provided such other items and
shall have satisfied such other conditions as may be reasonably required by
Agent and the Lenders.
SECTION 5. MISCELLANEOUS.
5.1. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties made in this Amendment shall survive the execution and delivery of
this Amendment, and no investigation by Agent or any Lender or any subsequent
Revolving Loan or other extension of credit under the Forbearance Agreement
shall affect the representations and warranties or the right of Agent or any
Lender to rely upon them.
5.2. REFERENCE TO FORBEARANCE AGREEMENT. The Forbearance Agreement and any
and all other agreements, instruments or documentation now or hereafter executed
and delivered pursuant to the terms of the Forbearance Agreement as amended
hereby, are hereby amended so that any reference therein to the Forbearance
Agreement shall mean a reference to the Forbearance Agreement as amended hereby.
5.3. SEVERABILITY. Any term or 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 term or provision so held to be invalid or unenforceable.
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5.4. HEADINGS. The headings, captions and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment.
5.5. ENTIRE AGREEMENT. This Amendment is specifically limited to the
matters expressly set forth herein. This Amendment and all other instruments,
agreements and documentation executed and delivered in connection with this
Amendment embody the final, entire agreement among the parties hereto with
respect to the subject matter hereof and supersede any and all prior
commitments, agreements, representations and understandings, whether written or
oral, relating to the matters covered by 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 relating to the subject matter hereof or any other
subject matter relating to the Forbearance Agreement. Except as set forth
herein, the Forbearance Agreement shall remain in full force and effect and be
unaffected hereby.
5.6. COUNTERPARTS. This Amendment may be executed by the parties hereto
separately in one or more counterparts and by facsimile signature, 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 agreement.
5.7. WAIVER OF CLAIMS. Each Continuing Credit Party, by signing below,
hereby waives and releases Agent and each of the Lenders and their respective
directors, officers, employees, attorneys, affiliates and subsidiaries from any
and all claims, offsets, defenses and counterclaims of which such Continuing
Credit Party is aware, such waiver and release being with full knowledge and
understanding of the circumstances and effect thereof and after having consulted
legal counsel with respect thereto.
5.8. APPLICABLE LAW. THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS
AMENDMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS.
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5.9. JURY TRIAL WAIVER. THE CONTINUING CREDIT PARTIES, AGENT AND THE
LENDERS EACH HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING ARISING OUT OF THIS AGREEMENT, THE FORBEARANCE AGREEMENT, ANY OF THE
OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREUNDER. THE CONTINUING
CREDIT PARTIES HEREBY IRREVOCABLY WAIVE PERSONAL SERVICE OF PROCESS AND CONSENT
TO SERVICE OF PROCESS BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED.
IN NO EVENT WILL AGENT OR THE LENDERS BE LIABLE FOR LOST PROFITS OR OTHER
SPECIAL OR CONSEQUENTIAL DAMAGES.
IN WITNESS WHEREOF, this Amendment has been duly executed and delivered as
of the date first above written.
BORROWER:
XXXXXXXXX XXXXX CORPORATION
By: /s/ Xxx X. Xxxxxxxx
Name: Xxx X. Xxxxxxxx
Title: President and Chief Operating Officer
CONTINUING CREDIT PARTIES:
XXXXXX MAY HOLDINGS, INC.
By: /s/ Xxx X. Xxxxxxxx
Name: Xxx X. Xxxxxxxx
Title: President and Chief Operating Officer
XXXXXXXXX XXXXX (CANADA) CORPORATION
By: /s/ Xxx X. Xxxxxxxx
Name: Xxx X. Xxxxxxxx
Title: President and Chief Operating Officer
AGENT AND SOLE LENDER:
THE CIT GROUP/BUSINESS CREDIT, INC., as
Agent and as the sole Lender
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Assistant Vice President
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EXHIBIT A
Noteholder Forbearance Amendment
(See attached)
