1
Exhibit 10.2
FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND WAIVER
THIS FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND
WAIVER (this "Amendment"), dated as of July 2, 1998, is by and among Genicom
Corporation (the "Borrower"), the subsidiaries of the Borrower identified on the
signature pages hereto (the "Guarantors"), the several lenders identified on the
signature pages hereto (each a "Lender" and, collectively, the "Lenders") and
NationsBank, N.A., as agent for the Lenders (in such capacity, the "Agent").
Capitalized terms used herein which are not defined herein and which are defined
in the Credit Agreement shall have the same meanings as therein defined.
W I T N E S S E T H
WHEREAS, the Borrower, the Guarantors, the Lenders and the Agent
entered into that certain Amended and Restated Credit Agreement dated as of
September 5, 1997, as amended by that First Amendment to Amended and Restated
Credit Agreement dated as of October 31, 1997, as amended by that Second
Amendment to Amended and Restated Credit Agreement dated as of March 12, 1998,
as amended by that letter agreement dated May 5, 1998 (as so amended, the
"Existing Credit Agreement").
WHEREAS, the parties have agreed to amend the Existing Credit Agreement
and waive certain Defaults as set forth herein.
NOW, THEREFORE, in consideration of the agreements hereinafter set
forth, and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the parties hereto agree as follows:
PART I
DEFINITIONS
1. Certain Definitions. Unless otherwise defined herein or the context
otherwise requires, the following terms used in this Amendment, including its
preamble and recitals, have the following meanings:
"Amended Credit Agreement" means the Existing Credit Agreement
as amended hereby.
"Amendment No. 4 Effective Date" is defined in Part IV.
2. Other Definitions. Unless otherwise defined herein or the context
otherwise requires, terms used in this Amendment, including its preamble and
recitals, have the meanings provided in the Amended Credit Agreement.
2
PART II
AMENDMENTS TO EXISTING CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the Amendment No. 4
Effective Date, the Existing Credit Agreement is hereby amended in accordance
with this Part II. Except as so amended, the Existing Credit Agreement and all
other Credit Documents shall continue in full force and effect.
1. Amendments to Section 1.1.
(a) The following definitions appearing in Section 1.1 of the Existing
Credit Agreement are amended in their entireties to read as follows:
"Applicable Percentage" means, for purposes of calculating the
applicable interest rate for any day for any Eurodollar Loan which is a
Revolving Loan, Tranche A Term Loan, Tranche B Term Loan or Foreign
Currency Loan or for any Base Rate Loan which is a Revolving Loan,
Tranche A Term Loan or Tranche B Term Loan, the applicable rate of the
Unused Fee for any day for purposes of Section 3.5(a) or the applicable
rate of the Standby Letter of Credit Fee for any day for purposes of
Section 3.5(b)(i), the appropriate applicable percentage corresponding
to the Pricing Consolidated Funded Debt Coverage Ratio in effect as of
the most recent Calculation Date:
Applicable Applicable
Percentage for Percentage for Applicable
Eurodollar Eurodollar Percentage for Applicable
Pricing Consolidated Loans which are Percentage for Eurodollar Percentage for
Funded Debt Revolving Loans, Tranche Home Rate Loans which are Base Rate
Pricing Coverage A Term Loans or Foreign Loans which are Tranche B Term Loans which are
Level Ratio Currency Loans Loans Loans Tranche B Term Loans
--------------------------------------------------------------------------------------------------------------------------
I Greater than or equal
to 4.50 to 1.00 3.00% 1.75% 3.50% 2.25%
--------------------------------------------------------------------------------------------------------------------------
II Greater than or equal
to 3.502.75%.00 but
less than 41.50 to 2.75% 1.50% 3.25% 2.00%
--------------------------------------------------------------------------------------------------------------------------
III Greater than or equal
to 3.002.50%.00 but
less than 31.25 to 1.00 2.50% 1.25% 3.00% 1.75%
--------------------------------------------------------------------------------------------------------------------------
IV Greater than or equal
to 2.502.25%.00 but
less than 31.00 to 1.00 2.25% 1.00% 3.00% 1.75%
--------------------------------------------------------------------------------------------------------------------------
V Greater than or equal
to 2.002.00%.00 but
less than 20.75 to 1.00 2.00% 0.75% 3.00% 1.75%
--------------------------------------------------------------------------------------------------------------------------
VI Less than 2.00 to 1.00 1.75% 0.50% 3.00% 1.75%
==========================================================================================================================
Pricing Consolidated
Funded Debt Applicable Applicable
Pricing Coverage for Standby Letter of Percentage for
Level Ratio Credit Fee Unused Fee
--------------------------------------------------------------------------------
I Greater than or equal
to 4.50 to 1.00 3.00% 0.50%
--------------------------------------------------------------------------------
II Greater than or equal
to 3.502.75%.00 but
less than 41.50 to 2.75% 0.50%
--------------------------------------------------------------------------------
III Greater than or equal
to 3.002.50%.00 but
less than 31.25 to 1.00 2.50% 0.50%
--------------------------------------------------------------------------------
IV Greater than or equal
to 2.502.25%.00 but
less than 31.00 to 1.00 2.25% 0.50%
--------------------------------------------------------------------------------
V Greater than or equal
to 2.002.00%.00 but
less than 20.75 to 1.00 2.00% 0.375%
--------------------------------------------------------------------------------
VI Less than 2.00 to 1.00 1.75% 0.375%
================================================================================
The initial Applicable Percentages shall be based on Pricing
Level II until the first Applicable Percentage Change Date for the
Calculation Date occurring on September 28, 1997. Thereafter,
determination of the appropriate Applicable Percentages based on the
Pricing Consolidated Funded Debt Coverage Ratio shall be made on each
Calculation Date upon receipt by the Agent at the Agency Services
Address of the Required Financial Information for such Calculation
Date. The Pricing Consolidated Funded Debt Coverage
-2-
3
Ratio in effect as of a Calculation Date shall establish the Applicable
Percentages that shall be effective as of the date designated by the
Agent as the Applicable Percentage Change Date. The Agent shall
determine the Applicable Percentages as of the Calculation Date
occurring on September 28, 1997 and on each Calculation Date thereafter
and shall promptly notify the Borrower and the Lenders of the
Applicable Percentages so determined and of the Applicable Percentage
Change Date. Such determinations by the Agent of the Applicable
Percentages shall be conclusive absent demonstrable error. If the
Borrower fails to provide the Required Financial Information for a
Calculation Date to the Agent at the Agency Services Address, the
Applicable Percentages shall be based on Pricing Level I until such
time as the Required Financial Information is provided whereupon the
Pricing Level shall be determined by the then current Pricing
Consolidated Funded Debt Coverage Ratio. Notwithstanding anything to
the contrary contained herein, if on any Calculation Date occurring on
or after January 3, 1999, the Consolidated Senior Funded Debt Coverage
Ratio exceeds 4.0 to 1.0, the Applicable Percentages determined in
accordance with the pricing grid above shall be increased by 1.0%.
"Borrowing Base" means (i) as of any day prior to November 1,
1998, the sum of (a) 85% of Eligible Receivables and (b) 55% of
Eligible Inventory, in each case as set forth in the most recent
Borrowing Base Report delivered to the Agent and the Lenders in
accordance with the terms of Section 7.1(e); provided, however, that
the amount determined pursuant to clause (b) above shall not exceed 50%
of the total Borrowing Base, (ii) as of any day on or after November 1,
1998 and prior to January 3, 1999, the sum of (a) 85% of Eligible
Receivables and (b) 45% of Eligible Inventory, in each case as set
forth in the most recent Borrowing Base Report delivered to the Agent
and the Lenders in accordance with the terms of Section 7.1(e);
provided, however, that the amount determined pursuant to clause (b)
above shall not exceed 50% of the total Borrowing Base and (iii) as of
any day on or after January 3, 1999, the Original Borrowing Base.
"Consolidated EBITDA" means, for any period, the sum of (i)
Consolidated Net Income for such period, plus (ii) an amount which, in
the determination of Consolidated Net Income for such period, has been
deducted for (A) Consolidated Interest Expense, (B) total federal,
state, local and foreign income, value added and similar taxes and (C)
depreciation and amortization expense, all as determined in accordance
with GAAP; provided, however, Consolidated EBITDA shall exclude (x) up
to $1,739,000 in non-cash charges incurred during the fourth fiscal
quarter of 1997 in connection with the acquisition of certain assets of
the printer division of Digital Equipment Corporation and (y) up to
$15,000,000 in a non-cash write-off against the Borrower's intangible
assets incurred during the second fiscal quarter of 1998.
"Consolidated Fixed Charge Coverage Ratio" means (a) as of the
end of any period prior to and including January 3, 1999, the ratio of
(i) Consolidated EBITDA for the applicable period to (ii) Consolidated
Interest Expense for the applicable period plus Consolidated Scheduled
Funded Indebtedness Payments for the applicable period plus Restricted
Payments by the Borrower and its Subsidiaries on a consolidated basis
for the applicable period, and (b) as of the end of any period after
January 3, 1999, the ratio of (i) Consolidated EBITDA for the
applicable period minus Consolidated Capital Expenditures
-3-
4
for the applicable period, to (ii) Consolidated Interest Expense for
the applicable period plus Consolidated Scheduled Funded Indebtedness
Payments for the applicable period plus Restricted Payments by the
Borrower and its Subsidiaries on a consolidated basis for the
applicable period.
"Consolidated Funded Debt Coverage Ratio" means (a) for the
purpose of determining compliance with the financial covenant contained
in Section 7.11(b) hereof as of any Calculation Date occurring on or
prior to January 3, 1999, the ratio of (i) Funded Indebtedness of the
Borrower and its Subsidiaries on a consolidated basis as of such
Calculation Date, to (ii) Consolidated EBITDA for the four-quarter
period ended as of such Calculation Date, and (b) for the purpose of
determining compliance with the financial covenant contained in Section
7.11(b) hereof as of any Calculation Date occurring after January 3,
1999, the ratio of (i) Funded Indebtedness of the Borrower and its
Subsidiaries on a consolidated basis as of such Calculation Date, to
(ii) Consolidated EBITDA for the four-quarter period ended as of such
Calculation Date minus Consolidated Capital Expenditures for the
four-quarter period ended as of such Calculation Date.
"Consolidated Net Income" means, for any period, net income
(excluding extraordinary items) after taxes for such period of the
Borrower and its Subsidiaries on a consolidated basis, as determined in
accordance with GAAP.
"Net Proceeds" means cash proceeds received by the Borrower or
any of its Subsidiaries from time to time in connection with any Asset
Disposition, Debt Issuance or Equity Transaction, net of the actual
costs (excluding intercompany items) and taxes incurred by such Person
in connection with and attributable to such Asset Disposition, Debt
Issuance or Equity Transaction, as applicable.
"Permitted Investments" means Investments which are either (i)
cash and Cash Equivalents; (ii) accounts receivable created, acquired
or made by the Borrower or any of its Subsidiaries in the ordinary
course of business and payable or dischargeable in accordance with
customary trade terms; (iii) Investments consisting of stock,
obligations, securities or other property received by the Borrower or
any of its Subsidiaries in settlement of accounts receivable (created
in the ordinary course of business) from bankrupt obligors; (iv)
Investments existing as of the Closing Date and set forth in Schedule
1.1A, (v) additional Investments in any Subsidiary of the Borrower
which is a Guarantor; (vi) subject to the terms of Section 7.15(b),
Investments in Subsidiaries of the Borrower which are not Guarantors
existing as of June 15, 1998 and additional Investments in all such
Subsidiaries not to exceed an aggregate amount of $1,000,000 per year;
(vii) Guaranty Obligations permitted by Section 8.1; (viii)
acquisitions permitted by Section 8.4(c); (ix) transactions permitted
by Section 8.8; and (x) loans to directors, officers, employees,
agents, customers or suppliers that do not exceed an aggregate
principal amount of $1,000,000 at any one time outstanding.
(b) The following new definitions are added to Section 1.1 of the Existing
Credit Agreement in the appropriate alphabetical order to read as follows:
-4-
5
"Consolidated Senior Funded Debt Coverage Ratio" means, as of
any Calculation Date, the ratio of (i) Senior Funded Indebtedness of
the Borrower and its Subsidiaries on a consolidated basis as of such
Calculation Date, to (ii) Consolidated EBITDA for the four-quarter
period ended as of such Calculation Date minus Consolidated Capital
Expenditures for the four-quarter period ended as of such Calculation
Date.
"Debt Issuance" means the issuance of any Indebtedness for
borrowed money by the Borrower or any of its Subsidiaries.
"Original Borrowing Base" means, as of any day, the sum of (a)
80% of Eligible Receivables and (b) 40% of Eligible Inventory, in each
case as set forth in the most recent Original Borrowing Base Report
delivered to the Agent and the Lenders in accordance with the terms of
Section 7.1(e); provided, however, that the amount determined pursuant
to clause (b) above shall not exceed 50% of the total Original
Borrowing Base.
"Pricing Consolidated Funded Debt Coverage Ratio" means, as
of any Calculation Date, the ratio of (i) Funded Indebtedness of the
Borrower and its Subsidiaries on a consolidated basis as of such
Calculation Date, to (ii) Consolidated EBITDA for the four-quarter
period ended as of such Calculation Date minus Consolidated Capital
Expenditures for the four-quarter period ended as of such Calculation
Date.
"Senior Funded Indebtedness" means, with respect to any
Person, total Funded Indebtedness (other than Subordinated
Indebtedness).
"Subordinated Indebtedness" means, any Indebtedness incurred
by the Borrower after July 1, 1998 which by its terms is specifically
subordinated in right of payment to the prior payment of the
obligations of the Credit Parties under this Credit Agreement and the
other Credit Documents on terms and conditions satisfactory to the
Required Lenders.
2. Amendment to Section 3.1. Section 3.1 of the Existing Credit Agreement is
hereby amended in its entirety to read as follows:
3.1 Default Rate/ Original Borrowing Base Fee.
(a) Default Rate. Upon the occurrence, and during the continuance, of
an Event of Default, the principal of and, to the extent permitted by law,
interest on the Loans and any other amounts owing hereunder or under the other
Credit Documents shall bear interest, payable on demand, at a per annum rate 2%
greater than the rate which would otherwise be applicable (or if no rate is
applicable, whether in respect of interest, fees or other amounts, then 2%
greater than the Base Rate).
(b) Original Borrowing Base Rate.
At the time of delivery of the Original Borrowing Base Report as
required by Section 7.1(e) hereof for each month ending on or prior to January
3, 1999, the Borrower promises to immediately pay additional interest at a rate
of 1.50% per annum on the amount (to the extent positive) equal to the amount by
which on such day (i) the sum of the aggregate principal amount
-5-
6
of outstanding Revolving Loans plus the Dollar Amount (as determined as of the
most recent Determination Date) of the aggregate principal amount of outstanding
Foreign Currency Loans plus the aggregate principal amount of outstanding
Swingline Loans plus LOC Obligations outstanding exceeds (ii) the Original
Borrowing Base.
3. Amendment to Section 3.3(b). Section 3.3(b) of the Existing Credit
Agreement is hereby amended in its entirety to read as follows:
(b) Mandatory Prepayments.
(i) If at any time the sum of the aggregate principal
amount of outstanding Revolving Loans plus the Dollar Amount
(as determined as of the most recent Determination Date) of
the aggregate principal amount of outstanding Foreign Currency
Loans plus the aggregate principal amount of outstanding
Swingline Loans plus LOC Obligations outstanding shall exceed
the lesser of (a) the Revolving Committed Amount and (b) the
Borrowing Base, the Borrower promises to prepay immediately
the outstanding principal balance on the Revolving Loans in an
amount sufficient to eliminate such excess.
(ii) If on any Determination Date the Dollar Amount
of the aggregate Foreign Currency Loans outstanding exceeds
(as the result of fluctuations in applicable foreign exchange
rates or otherwise) the then Foreign Currency Committed
Amount, the Borrower promises to make a mandatory prepayment
to the Agent in an aggregate Dollar Amount equal to the excess
of
(x) the amount equal to the Dollar Amount of
the aggregate Foreign Currency Loans outstanding
over
(y) the Foreign Currency Committed Amount.
(iii) Immediately upon the occurrence of any Asset
Disposition Prepayment Event, the Borrower shall prepay the
Loans in an aggregate amount equal to the Net Proceeds of the
related Asset Disposition not applied (or caused to be
applied) by the Borrower during the related Application Period
to the purchase, acquisition or construction of Alternative
Assets as contemplated by the terms of Section 8.4(b)(v).
(iv) Within 120 days after the end of each fiscal
year of the Borrower and its Subsidiaries (commencing with the
fiscal year ending December 28, 1997), the Borrower shall
prepay the Loans in an aggregate amount equal to 75% of the
Excess Cash Flow for such prior fiscal year.
(v) Immediately upon receipt by the Borrower or any
of its Subsidiaries of proceeds from any Debt Issuance, the
Borrower shall prepay the Loans in an aggregate
-6-
7
amount equal to 100% of the Net Proceeds of such Debt Issuance
to the Lenders (such prepayment to be applied as set forth in
clause (vii) below).
(vi) Immediately upon receipt by the Borrower or any
of its Subsidiaries of proceeds from any Equity Transaction,
the Borrower shall prepay the Loans in an aggregate amount
equal to 100% of the Net Proceeds of such Equity Transaction
to the Lenders (such prepayment to be applied as set forth in
clause (vii) below); provided, however, that no such
prepayment shall be required pursuant to this clause (vi) in
connection with Net Proceeds received solely from Equity
Issuances made in connection with the exercise by employees of
the Borrower of their rights under employee stock ownership
plans or employee stock option plans administered by the
Borrower.
(vii) All prepayments made pursuant to this Section
3.3(b) shall (i) be subject to Section 3.12, (ii) in the case
of prepayments made pursuant to Section 3.3(b)(iii), (iv), (v)
or (vi), be applied first pro rata to the Tranche A Term Loan
and the Tranche B Term Loan (ratably to the remaining
principal installments thereof, in inverse order of maturity)
and then to the Revolving Loans (with a corresponding
reduction in the Revolving Committed Amount), (iii) subject to
the terms of clause (ii) above, be applied first to Base Rate
Loans, if any, and then to Eurodollar Loans in direct order of
Interest Period maturities and (iv) be accompanied by interest
on the principal amount prepaid through the date of
prepayment.
4. Amendment to Section 7.1(b). A new clause (iii) is added to Section
7.1(b) of the Existing Credit Agreement to read as follows:
(iii) Cash Position Forecast/Report. As soon as
available, and in any event within 15 days after the close of
each fiscal month, a forecast of cash inflows and outflows of
the Borrower and its cash sweep of Subsidiaries for the next 8
weeks together with a statement of actual cash position of the
Borrower for the 4 weeks then ended, all such financial
information described above to be in reasonable form and
detail and reasonably acceptable to the Agent, and accompanied
by a certificate of the chief financial officer or treasurer
of the Borrower to the effect that such forecasts and
statement of actual cash position have been prepared using
reasonable assumptions and projections where required.
5. Amendment to Section 7.1(e). Section 7.1(e) of the Existing Credit
Agreement is hereby amended in its entirety to read as follows:
(e) Borrowing Base/Original Borrowing Base Reports. (i) Within 15
days after the end of each calendar month, a Borrowing Base Report and
an Original Borrowing Base Report, each as of the end of the
immediately preceding month and (ii) as soon as available after the
request of the Required Lenders, a Borrowing Base Report as of the date
of such request. Each of the Borrowing Base Report and the Original
Borrowing Base Report shall be substantially in the form of Schedule
7.1(e) and certified by the chief financial officer or treasurer of the
Borrower to be true and correct as of the date thereof.
-7-
8
6. Amendment to Section 7.11. Section 7.11 of the Existing Credit
Agreement is hereby amended in its entirety to read as follows:
7.11 Financial Covenants.
(a) Consolidated Tangible Net Worth. Consolidated Tangible Net
Worth at all times shall be no less than:
(i) as of the last day of the third fiscal quarter
for the fiscal year 1997, the sum of $12,500,000, increased by
an amount equal to 100% of the proceeds received from all
Equity Transactions occurring after the Closing Date;
(ii) as of the last day of the fourth fiscal quarter
for the fiscal year 1997 and the last day of the first fiscal
quarter for the fiscal year 1998, the sum of $6,000,000,
increased by an amount equal to (A) 50% of the Consolidated
Net Income (without deduction for any losses) for each fiscal
quarter commencing with the fourth fiscal quarter for the
fiscal year 1997 through and including the fiscal quarter then
ended, plus (B) 100% of the proceeds received from all Equity
Transactions occurring after the Closing Date;
(iii) as of the last day of the second fiscal quarter
for the fiscal year 1998, the sum of $7,000,000, increased by
an amount equal to (A) 50% of the Consolidated Net Income
(without deduction for any losses) for each fiscal quarter
commencing with the fourth fiscal quarter for the fiscal year
1997 through and including the fiscal quarter then ended, plus
(B) 100% of the proceeds received from all Equity Transactions
occurring after the Closing Date;
(iv) as of the last day of the third fiscal quarter
for the fiscal year 1998, the sum of $8,000,000, increased by
an amount equal to (A) 50% of the Consolidated Net Income
(without deduction for any losses) for each fiscal quarter
commencing with the fourth fiscal quarter for the fiscal year
1997 through and including the fiscal quarter then ended, plus
(B) 100% of the proceeds received from all Equity Transactions
occurring after the Closing Date;
(v) as of the last day of the fourth fiscal quarter
for the fiscal year 1998, the sum of $10,000,000, increased by
an amount equal to (A) 50% of the Consolidated Net Income
(without deduction for any losses) for each fiscal quarter
commencing with the fourth fiscal quarter for the fiscal year
1997 through and including the fiscal quarter then ended, plus
(B) 100% of the proceeds received from all Equity Transactions
occurring after the Closing Date; and
(vi) as of the last day of the first fiscal quarter
for the fiscal year 1999 and the last day of each fiscal
quarter thereafter, the sum of $12,500,000, increased by an
amount equal to (A) 50% of the Consolidated Net Income
(without deduction for any losses) for each fiscal quarter
commencing with the fourth fiscal quarter for the fiscal year
1997 through and including the fiscal quarter then ended, plus
(B)
-8-
9
100% of the proceeds received from all Equity Transactions
occurring after the Closing Date.
(b) Consolidated Funded Debt Coverage Ratio. The Consolidated
Funded Debt Coverage Ratio at each Calculation Date shall be no greater
than the following proportions:
Period Ratio
------ -----
As of the last day of 5.25 to 1.00
the third fiscal quarter
of fiscal year 1997
As of the last day of the 6.50 to 1.00
fourth fiscal quarter of
fiscal year 1997
As of the last day of the 6.25 to 1.00
first fiscal quarter of fiscal
year 1998 of the Borrower
and its Subsidiaries
As of the last day of 4.00 to 1.00
the second fiscal quarter
of fiscal year 1998 of
the Borrower and its
Subsidiaries
As of the last day of 4.50 to 1.00
the third fiscal quarter
of fiscal year 1998 of
the Borrower and its
Subsidiaries
As of the last day of 4.25 to 1.00
the fourth fiscal quarter
of fiscal year 1998 of
the Borrower and its
Subsidiaries
As of the last day of 3.50 to 1.00
the first fiscal quarter
of fiscal year 1999 of
the Borrower and its
Subsidiaries
-9-
10
As of the last day of 3.25 to 1.00
the second fiscal quarter
of fiscal year 1999 of
the Borrower and its
Subsidiaries
As of the last day of 3.00 to 1.00
the third fiscal quarter
of fiscal year 1999
of the Borrower and its
Subsidiaries and thereafter
(c) Consolidated Fixed Charge Coverage Ratio. The Consolidated
Fixed Charge Coverage Ratio at each Calculation Date shall be no less than the
following proportions:
Period Ratio
------ -----
For the period occurring 1.25 to 1.00
from the Closing Date
through the last
day of the first fiscal
quarter of fiscal year 1998
of the Borrower and its
Subsidiaries
For the period occurring 2.00 to 1.00
from the first day of the
second fiscal quarter of
fiscal year 1998 through
the last day of the
second fiscal quarter of fiscal
year 1998 of the Borrower
and its Subsidiaries
For the period occurring 1.75 to 1.00
from the first day of the
third fiscal quarter of
fiscal year 1998 through
the last day of the
third fiscal quarter of fiscal
year 1998 of the Borrower
and its Subsidiaries
For the period occurring 1.85 to 1.00
from the first day of the
fourth fiscal quarter of
-10-
11
fiscal year 1998 through
the last day of the
fourth fiscal quarter of fiscal
year 1998 of the Borrower
and its Subsidiaries
For the period occurring 1.75 to 1.00
from the first day of the
first fiscal quarter of
fiscal year 1999 of the
Borrower and its
Subsidiaries and thereafter
(d) Consolidated Debt to Capitalization Ratio. The
Consolidated Debt to Capitalization at each Calculation Date shall be
no greater than the following proportions:
Period Ratio
------ -----
For the period occurring 0.75 to 1.00
from the Closing Date
through the last
day of the first fiscal
quarter of fiscal year 1998
of the Borrower and its
Subsidiaries
For the period occurring 0.79 to 1.00
from the first day of the
second fiscal quarter of
fiscal year 1998 of the
Borrower and its
Subsidiaries through
the last day of the
fourth fiscal quarter of fiscal
year 1998 of the Borrower
and its Subsidiaries
For the period occurring 0.65 to 1.00
from the first day of the
first fiscal quarter of
fiscal year 1999 of the
Borrower and its
Subsidiaries through
the last day of the
fourth fiscal quarter of fiscal
year 1999 of the Borrower
-11-
12
and its Subsidiaries
For the period occurring 0.60 to 1.00
from the first day of the
first fiscal quarter of
fiscal year 2000 of the
Borrower and its
Subsidiaries and
thereafter
(e) Consolidated Capital Expenditures. Consolidated Capital
Expenditures for the four fiscal quarter period ending at each
Calculation Date shall not exceed:
For the period ending $27,500,000
on the last day of
the second fiscal quarter of
fiscal year 1998 of the
Borrower and its
Subsidiaries
For the period ending $27,500,000
on the last day of
the third fiscal quarter of
fiscal year 1998 of the
Borrower and its
Subsidiaries
For the period ending $27,000,000
on the last day of
the fourth fiscal quarter of
fiscal year 1998 of the
Borrower and its
Subsidiaries and thereafter
7. New Section 7.16. A new section 7.16 is hereby added to the Existing
Credit Agreement immediately following Section 7.15 thereof which shall read as
follows:
7.16 BORROWER DEPOSIT ACCOUNTS.
The Borrower shall maintain its domestic depository accounts with one
or more Lenders.
8. Amendment to Section 8.4. Subsection (c) of Section 8.4 of the
Existing Credit Agreement is hereby amended in its entirety to read as follows:
8.4 Consolidation, Merger, Sale or Purchase of Assets, etc.
The Borrower will not, nor will it permit any of its Subsidiaries to:
-12-
13
**********
(c) enter into any Acquisition transaction (in a single
transaction or a series of related transactions) except (i) as
otherwise permitted by Section 8.4(a) and Section 8.5, (ii) for the
acquisition of Property in the ordinary course of business for fair
consideration and (iii) for the purchase on or before December 15, 1997
of the NCS Assets pursuant to the terms of the NCS Purchase Agreement.
9. Amendment to Section 9.1(c). Section 9.1(c) of the Existing Credit
Agreement is hereby amended in its entirety to read as follows:
(c) Covenants. Any Credit Party shall
(i) default in the due performance or observance of
any term, covenant or agreement contained in Sections 7.2,
7.9, 7.11, 7.12, 7.14, 7.15, or 8.1 through 8.14, inclusive,
or
(ii) default in the due performance or observance by
it of any term, covenant or agreement contained in Section
7.1(e) and such default shall continue unremedied for a period
of at least 7 Business Days after the earlier of a responsible
officer of a Credit Party becoming aware of such default or
notice thereof by the Agent; or
(iii) default in the due performance or observance by
it of any term, covenant or agreement (other than those
referred to in subsections (a), (b), (c)(i) or (c)(ii) of this
Section 9.1) contained in this Credit Agreement and such
default shall continue unremedied for a period of at least 30
days after the earlier of a responsible officer of a Credit
Party becoming aware of such default or notice thereof by the
Agent; or
10. Schedule 7.1(e). Schedule 7.1(e) is hereby replaced with new
Schedule 7.1(e) in the form of Exhibit A attached hereto.
PART III
WAIVER
The Agent and the Required Lenders hereby waive through July 15, 1998
the requirement that the Borrower deliver a Borrowing Base Report for the
calendar month ended May 31, 1998 on or before June 15, 1998 as provided in
Section 7.1(e) of the Credit Agreement. The Agent and the Required Lenders
further agree that the failure to deliver such Borrowing Base Report by June 15,
1998 shall not constitute a Default under the Credit Agreement. This is a
one-time waiver and will expire without further notice on July 15, 1998. The
failure of the Borrower to deliver such Borrowing Base Report by July 15, 1998
shall constitute an Event of Default.
PART IV
CONDITIONS TO EFFECTIVENESS
-13-
14
1. Amendment No. 4 Effective Date. This Amendment shall be and become
effective as of the date hereof (the "Amendment No. 4 Effective Date") when all
of the conditions set forth in this Part IV shall have been satisfied, and
thereafter this Amendment shall be known, and may be referred to, as "Amendment
No. 4."
2. Execution of Counterparts of Amendment. The Agent shall have
received counterparts (or other evidence of execution, including telephonic
message, satisfactory to the Agent) of this Amendment, which collectively shall
have been duly executed on behalf of each of the Borrower, the Guarantors and
the Required Lenders.
3. Corporate Existence. The Agent shall have received all documents it
may reasonably request relating to the existence and good standing of each of
the Credit Parties, the corporate or other necessary authority for and the
validity of this Amendment, and any other matters relevant thereto, all in form
and substance reasonably satisfactory to the Agent.
4. Legal Opinion. The Agent shall have received a legal opinion of
McGuire, Woods, Battle & Xxxxxx, counsel for the Credit Parties in form and
substance reasonably satisfactory to the Agent.
5. Officer's Certificate. The Agent shall have received a certificate
executed by the chief financial officer of the Borrower as of the Amendment No.
4 Effective Date stating that, immediately after giving effect to this Amendment
and the transactions contemplated hereby, (i) each of the Credit Parties is
Solvent, (ii) no Default or Event of Default (other than any Default or Event of
Default that has been waived) exists and (iii) the representations and
warranties set forth in the Existing Credit Agreement are true and correct in
all material respects.
6. Material Adverse Change. Except as otherwise previously disclosed in
writing to the Lenders, no material adverse change shall have occurred since
December 29, 1996 in the condition (financial or otherwise), business or
management of the Borrower or of the Borrower and its Subsidiaries taken as a
whole.
7. Amendment Fee. The Agent shall have received for the account of each
Lender an amendment fee of 0.25% on such Lender's Commitment.
8. Other Items. The Agent shall have received such other documents,
agreements or information which may be reasonably requested by the Agent.
-14-
15
PART III
MISCELLANEOUS
1. Representations and Warranties. Borrower hereby represents and
warrants to the Agent and the Lenders that, after giving effect to this
Amendment, (a) no Default or Event of Default exists under the Credit Agreement
or any of the other Credit Documents which has not been waived and (b) the
representations and warranties set forth in Section 6 of the Existing Credit
Agreement are, subject to the limitations set forth therein, true and correct in
all material respects as of the date hereof (except for those which expressly
relate to an earlier date).
2. Cross-References. References in this Amendment to any Part are,
unless otherwise specified, to such Part of this Amendment.
3. Instrument Pursuant to Existing Credit Agreement. This Amendment is
a Credit Document executed pursuant to the Existing Credit Agreement and shall
(unless otherwise expressly indicated therein) be construed, administered and
applied in accordance with the terms and provisions of the Existing Credit
Agreement.
4. References in Other Credit Documents. At such time as this Amendment
No. 4 shall become effective pursuant to the terms of Part IV, all references in
the Credit Documents to the "Credit Agreement" shall be deemed to refer to the
Credit Agreement as amended by this Amendment No. 4.
5. Counterparts. This Amendment may be executed by the parties hereto
in several counterparts, each of which shall be deemed to be an original and all
of which shall constitute together but one and the same agreement.
6. Governing Law. THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE COMMONWEALTH OF VIRGINIA WITHOUT
GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
7. Successors and Assigns. This Amendment shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
[The remainder of this page has been left blank intentionally]
-15-
16
IN WITNESS WHEREOF the parties hereto have caused this Amendment to be
duly executed on the date first above written.
BORROWER:
GENICOM CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President
GUARANTORS:
GENICOM INTERNATIONAL HOLDINGS CORPORATION
By /s/ Xxxxx X. Xxxx
Title: President
GENICOM INTERNATIONAL SALES CORPORATION
By /s/ Xxxxx X. Xxxx
Title: President
DELMARVA TECHNOLOGIES CORPORATION
By /s/ Xxxxx X. Xxxx
Title: President
RASTEK CORPORATION
By /s/ Xxxxx X. Xxxx
Title: President and Treasurer
17
ENTERPRISING SERVICE SOLUTIONS CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Vice President
PRINTER SYSTEMS CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Vice President
THE PRINTER CONNECTION, INC.
By /s/ Xxxxx X. Xxxx
Title: Vice President
PRINTER SYSTEMS INTERNATIONAL, LTD.
By /s/ Xxxxx X. Xxxx
Title: Vice President
18
LENDERS:
NATIONSBANK, N.A. (formerly NationsBank of
Texas, N.A.), individually as a Lender
and in its capacity as Agent
By /s/ Xxxxxx Xxxx
Title: Senior Vice President
CREDITANSTALT CORPORATE FINANCE, INC.
By /s/ Xxxxx X. Xxxxx
Title: Vice President
By /s/ Xxxxxxxxx X. Xxxxxx
Title: Senior Vice Presidnet
DEEPROCK & COMPANY
By: Xxxxx Xxxxx Management,
as Investment Advisor
By /s/ Payson X. Xxxxxxxxx
Title: Vice President
CRESTAR BANK
By /s/ Xxxxx X. Xxxxxxx
Title: Senior Vice President
THE XXXXX NATIONAL BANK OF WASHINGTON, D.C.
By_____________________________
Title:
19
FLOATING RATE PORTFOLIO
By: INVESCO Senior Secured
Management, Inc., as attorney-in-fact
By /s/ Xxxxxxxx X. Xxxxxxxx
Title: Authorized Agent
KZH HOLDING CORPORATION III
By /s/ Xxxxxxxx Xxxxxx
Title: Authorized Agent
XXXXXX XXXXXXX SENIOR FUNDING, INC.
By /s/ Xxxxxxxxxxx X. Xxxxxxx
Title: Vice President
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By /s/ Payson X. Xxxxxxxxx
Title: Vice President
CERES FINANCE LTD.
By /s/ Xxxxx Egglish
Title: Director
AERIES FINANCE LTD.
By /s/ Xxxxxx Xxxxxxx
Title: Director
20
BANK OF SCOTLAND
By
Title:
NATIONAL CITY BANK OF KENTUCKY
By /s/ Xxxxx X. Xxxx
Title: Vice President
