EXHIBIT 10.2
THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "THIRD AMENDMENT") dated
as of July 18, 2003 is by and among APPLICA INCORPORATED (the "BORROWER"), a
Florida corporation, each of its Subsidiaries identified on the signature pages
hereof, the Lenders identified on the signature pages hereof and BANK OF
AMERICA, N.A., as administrative agent for the Lenders (in such capacity, the
"AGENT"). Terms used herein but not otherwise defined herein shall have the
meanings provided to such terms in the Credit Agreement (as hereinafter
defined).
W I T N E S S E T H
WHEREAS, the Borrower, the Subsidiaries, the Lenders and Bank of
America, N.A., in its capacity as Agent are parties to that certain Credit
Agreement, dated as of December 28, 2001, as amended April 26, 2002 and January
17, 2003 (as further amended, modified, supplemented, extended or restated from
time to time, the "CREDIT AGREEMENT");
WHEREAS, the parties hereto desire to amend certain terms of the Credit
Agreement as set forth in this Third Amendment;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. The Credit Agreement is hereby amended as follows:
(a) by adding to Annex A to the Credit Agreement in the proper
alphabetical location a new definition as follows:
"ZONEPERFECT NET PROCEEDS" means at any applicable date, the
Net Proceeds received by Borrower as a Distribution from Anasazi
Partners, L.P., a Massachusetts limited partnership ("Anasazi") arising
from Anasazi's sale of its interest in Zoneperfect Nutrition Company,
MINUS, without duplication, bonuses or other sums paid or payable by a
Loan Party with respect to such sale to directors, employees, agents or
representatives of a Loan Party.
(b) by deleting the definition of "Consolidated EBITDA" in
Annex A to the Credit Agreement and restating such definition as follows:
"CONSOLIDATED EBITDA" means, with respect to any fiscal period
of the Borrower, the Adjusted Net Earnings from Operations of the
Borrower and the other Consolidated Members, MINUS, Zoneperfect Net
Proceeds to the extent applied to the prepayment of the Debt evidenced
by the Senior Subordinated Debt Offering Documents, PLUS, to the
extent deducted in the determination of Adjusted Net Earnings from
Operations for that fiscal period, interest expenses, federal, state,
local and foreign income taxes, depreciation, amortization, call
premiums paid by Borrower in connection with its prepayment of Debt
evidenced by the Senior Subordinated Debt Offering Documents, non-cash
charges arising by reason of "goodwill impairment losses" under FASB
Statement 142, and, solely for purposes of calculating Consolidated
EBITDA for any period during the Borrower's 2002 Fiscal Year, those
costs associated with the Borrower's consolidation of its Shelton,
Connecticut facility into its Miami Lake, Florida facility that were
not previously accrued, as determined in accordance with GAAP.
(c) by deleting Section 7.14 of the Credit Agreement and by
restating such section as follows:
7.14 PREPAYMENT.
No Loan Party shall prepay voluntarily any Debt, except (a)
the Obligations in accordance with the terms of this Agreement, (b) in
connection with the Refinancing and (c) Debt evidenced by the Senior
Subordinated Debt Offering Documents (I) during Borrower's 2003 Fiscal
Year, in an aggregate amount not to exceed $30,000,000 plus the amount
of Zoneperfect Net Proceeds applied to such Debt in such Fiscal Year
and (II) during any Fiscal Year thereafter, in an aggregate amount not
to exceed $15,000,000 plus the amount of the Zoneperfect Proceeds
applied to such Debt in any such Fiscal Year, if, in each case, (i) no
Event of Default then exists or would exist after giving effect to any
such prepayment and (ii) for 30 consecutive days prior to such
prepayment Availability is not less than $35,000,000 and for 30
consecutive days immediately after such prepayment Availability is not
less than $30,000,000.
(d) by deleting Section 7.27 of the Credit Agreement and by
restating such section as follows:
7.27 MINIMUM EBITDA.
If the Loan Parties fail to maintain Availability of at least
$30,000,000 on any date on or after January 1, 2002 (any date on or
after January 1, 2002 on which the Loan Parties fail to maintain such
Availability being hereinafter referred to as the "Trigger Date"), then
as of the last day of the fiscal quarter in which the Trigger Date
occurs, the Loan Parties shall not permit Consolidated EBITDA or North
American EBITDA to be less than the amounts set forth below for the
test period applicable for the fiscal quarter in which such Trigger
Date occurs:
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MINIMUM MINIMUM NORTH
PERIOD CONSOLIDATED EBITDA AMERICAN EBITDA
------ ------------------- ---------------
The Applicable Period ending $55,000,000 $6,500,000
December 31, 2002 and as of
the last day of each Fiscal
Quarter thereafter, in each
case for the Applicable
Period then ending
Provided that from and after the date on which the Debt evidenced by
the Senior Subordinated Debt Documents shall have been prepaid by the
Borrower in an aggregate amount (i) equal to or greater than
$30,000,000 but less than $60,000,000, the foregoing minimum
Consolidated EBITDA shall be $53,000,000, or (ii) equal to or greater
than $60,000,000, the foregoing minimum Consolidated EBITDA shall be
$50,000,000. If the Loan Parties maintain Availability of at least
$30,000,000 on each day during any fiscal quarter, the Loan Parties
shall not be required to satisfy the foregoing Consolidated EBITDA and
North American EBITDA requirements as of the last day of such fiscal
quarter.
2. Notwithstanding the provisions of Sections 3.4 or 3.5 of the Credit
Agreement, the Borrower may apply the Zoneperfect Net Proceeds, no later than 35
days after receipt by a Loan Party, first to the Debt evidenced by the Senior
Subordinated Debt Offering Documents (the "Senior Subordinated Debt") in such
amount as the Borrower may elect and the balance of such proceeds to the
Obligations to the extent thereof; PROVIDED, HOWEVER, that for so long as no
Event of Default exists, the amounts so applied to the Obligations, at the
written request of the Borrower, shall be reserved against Availability and
thereafter may be reborrowed and applied by the Borrower to the repayment of
Senior Subordinated Debt; PROVIDED, FURTHER, HOWEVER, that any amounts so
reserved shall not be deemed to reduce Availability for purposes of Section 7.27
of the Credit Agreement. Notwithstanding the provisions of Section 7.9 of the
Credit Agreement the Borrower may sell or otherwise dispose of its interest in
Anasazi Partners, L.P. without the prior consent of Agent if the Net Proceeds
thereof do not exceed $500,000 and such Net Proceeds are applied to the
Obligations.
3. The effectiveness of this Third Amendment is subject to the
satisfaction of each of the following conditions (in form and substance
satisfactory to the Agent):
(a) The Agent shall have received executed counterparts of
this Third Amendment duly executed by the Loan Parties, the Agent and
the Lenders; and
(b) The Agent shall have received such additional agreements,
certificates or documents as it may reasonably request in connection
with this Third Amendment.
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4. The Borrower and the Guarantors represent and warrant to the Agent
and the Lenders that (i) the representations and warranties of the Loan Parties
set out in Article 6 of the Credit Agreement are true and correct as of the date
hereof (except those which expressly relate to an earlier period), (ii) no event
has occurred and is continuing which constitutes a Default or Event of Default
and (iii) no Loan Party has any counterclaims, offsets, credits or defenses to
the Loan Documents and the performance of its obligations thereunder, or if any
Loan Party has any such claims, counterclaims, offsets, credits or defenses to
the Loan Documents or any transaction related to the Loan Documents, same are
hereby waived, relinquished and released in consideration of the Agent's and the
Lenders' execution and delivery of this Third Amendment.
5. The Guarantors (i) acknowledge and consent to all of the terms and
conditions of this Third Amendment, (ii) affirm all of their obligations under
the Loan Documents and (iii) agree that this Third Amendment and all documents
executed in connection herewith do not operate to reduce or discharge the
Guarantors' obligations under Article 13 of the Credit Agreement or the other
Loan Documents.
6. The Borrower and the Guarantors hereby represent and warrant to the
Agent and the Lenders as follows:
(i) Each Loan Party has taken all necessary action to
authorize the execution, delivery and performance of this Third
Amendment.
(ii) This Third Amendment has been duly executed and delivered
by the Loan Parties and constitutes each of the Loan Parties' legal,
valid and binding obligations, enforceable in accordance with its
terms, except as such enforceability may be subject to (i) bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or similar laws affecting creditors' rights generally and
(ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in equity).
(iii) No consent, approval, authorization or order of, or
filing, registration or qualification with, any court or governmental
authority or third party is required in connection with the execution,
delivery or performance by any Loan Party of this Third Amendment.
7. Except as modified hereby, all of the terms and provisions of the
Credit Agreement (including Schedules and Exhibits) and the other Loan
Documents, and the obligations of the Loan Parties under the Credit Agreement
and the other Loan Documents, are hereby ratified and confirmed and shall remain
in full force and effect.
8. This Third Amendment may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed an original and it
shall not be necessary in making proof of this Third Amendment to produce or
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account for more than one such counterpart.
9. This Third Amendment shall be deemed to be a contract made under,
and for all purposes shall be construed in accordance with, the laws of the
State of New York.
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Third Amendment to be duly executed and delivered as of the date first
above written.
"BORROWER"
APPLICA INCORPORATED, a Florida corporation
By: /s/ Xxxx X. Xxxxxx
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
"GUARANTORS"
APPLICA CONSUMER PRODUCTS, INC., a Florida
corporation
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
APPLICA CANADA CORPORATION, a
Nova Scotia corporation
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
WD DELAWARE, INC., a Delaware corporation
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
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HP INTELLECTUAL CORP., a Delaware corporation
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
WINDMERE HOLDINGS CORPORATION, a Delaware
corporation
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
HP DELAWARE, INC., a Delaware corporation
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
HPG LLC, a Delaware limited liability company
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
HP AMERICAS, INC., a Delaware corporation
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer
[Signatures continued on following page]
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"AGENT"
Bank of America, N.A., as the Agent
By: /s/ XXXXXX X. XXXX
--------------------------------------
Name: XXXXXX X. XXXX
--------------------------------------
Title: VICE PRESIDENT
--------------------------------------
LENDERS"
Bank of America, N.A., as a Lender
By: /s/ XXXXXX X. XXXX
--------------------------------------
Name: XXXXXX X. XXXX
--------------------------------------
Title: VICE PRESIDENT
--------------------------------------
FLEET CAPITAL CORPORATION, as a Lender
By: /s/ XXXXXXXX XXX
--------------------------------------
Name: XXXXXXXX XXX
--------------------------------------
Title: VICE PRESIDENT
--------------------------------------
CONGRESS FINANCIAL CORPORATION (FLORIDA), as a
Lender
By: /s/ XXXXXX X. XXXXXXXX
--------------------------------------
Name: XXXXXX X. XXXXXXXX
--------------------------------------
Title: A.V.P.
--------------------------------------
LASALLE BUSINESS CREDIT, INC., as agent for
Standard Federal Bank National Association, as
a Lender
By: /s/ XXXXX X. XXXXX
--------------------------------------
Name: XXXXX X. XXXXX
--------------------------------------
Title: V.P.
--------------------------------------
[Signatures continued on following page]
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GENERAL ELECTRIC CAPITAL CORPORATION, as a Lender
By: /s/ XXXXXXX XXXXX
-----------------------------------------
Name: XXXXXXX XXXXX
-----------------------------------------
Title: DULY AUTHORIZED SIGNATORY
-----------------------------------------
HSBC BUSINESS CREDIT (USA), INC., as a Lender
By: /s/ XXXXX XXXXXXXX
-----------------------------------------
Name: XXXXX XXXXXXXX
-----------------------------------------
Title: VICE PRESIDENT
-----------------------------------------
PNC BANK, NATIONAL ASSOCIATION, as a Lender
By: /s/ JUNDIE CADIENA
-----------------------------------------
Name: JUNDIE CADIENA
-----------------------------------------
Title: VICE PRESIDENT
-----------------------------------------
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