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EXHIBIT 10.4
EXECUTION VERSION
FIRST AMENDMENT
TO
AMENDED AND RESTATED
EQUIPMENT FINANCING AGREEMENT
This First Amendment (the "First Amendment") to Amended and Restated
Equipment Financing Agreement dated as of February 19, 2001 (the "Effective
Date"), is entered into by and among XXXXX INTERNATIONAL (BRAZIL), LTD. (the
"Company") and MOTOROLA CREDIT CORPORATION (the "Creditor"). Unless otherwise
defined herein, capitalized terms used herein shall have the meanings, if any,
assigned them in the Amended and Restated EFA (defined in Recital A below.)
R E C I T A L S:
A. The Company and the Creditor are parties to an Amended and Restated
EFA dated as of April 28, 2000 (as heretofore amended, supplemented or otherwise
modified, the "Amended and Restated EFA"), pursuant to which the Creditor agreed
to maintain loans and make the Final Advance to the Company.
B. The Company has requested that, subject to the terms and provisions
hereof, the Creditor consent to certain amendments to the Amended and Restated
EFA.
C. The Creditor is willing to grant such consent, subject to the terms
and conditions of this First Amendment.
NOW, THEREFORE, for valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. AMENDMENTS.
Upon the satisfaction by the Company of the conditions precedent set
forth in Section 2 below, and in reliance on the warranties of the Company set
forth in Section 3 below, the Amended and Restated EFA is hereby amended as
follows:
1.1 Effective as of January 1, 2001, the definition of
"Maturity Date" in Section 1.1 of the Amended and
Restated EFA is hereby amended and restated in its
entirety as follows:
" "Maturity Date" means June 30, 2005, provided, if
such date is not a Business Day, then the Maturity
Date shall be the immediately preceding Business
Day."
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1.2 Schedule 1.01(d) to the Amended and Restated EFA is
hereby deleted and replaced with Schedule 1.01(d)
(Target Subscribers) attached hereto.
1.3 Section 2.04(a) of the Amended and Restated EFA is
hereby amended and restated in its entirety to read
as follows:
"(a) The Company shall pay to the Creditor the principal of
the Advances made by the Creditor outstanding at the close of
business on the Commitment Termination Date in eight (8) semi-annual
installments on the Payment Dates identified below (provided that the
last such payment shall be in an amount sufficient to repay in full
the principal amount of such Advances), with the amount of the
installment paid on each such Payment Date to be equal to the
respective percentages of the principal of such Advances outstanding
at the close of business on the Commitment Termination Date as set
forth below:
Percentage of Original
Principal of
Payment Date Advance Payable on such Payment Date
------------ ------------------------------------
June 30, 2000 10%
December 31, 2000 10%
December 31, 2002 10%
June 30, 2003 10%
December 31, 2003 15%
June 30, 2004 15%
December 31, 2004 15%
June 30, 2005 15%"
1.4 Section 8.17 of the Amended and Restated EFA is
hereby amended and restated in its entirety as
follows:
"The Company and its Subsidiaries shall have or maintain, on a
consolidated basis, at all times:
(a) a Fixed Charge Coverage Ratio (measured at the end of each
fiscal quarter) of not less than 1.00 : 1.00 at the end of each fiscal
quarter of the Company;
(b) EBITDA, at the end of each fiscal quarter period then
ended (measured at the end of each fiscal quarter), of not less than
the respective amounts set forth opposite each such date:
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Date EBITDA
---- ------
March 31, 2000 $(21,500,000)
June 30, 2000 $(16,400,000)
September 30, 2000 $(19,300,000)
December 31, 2000 $(22,300,000)
March 31, 2001 $(11,800,000)
June 30, 2001 $(9,900,000)
September 30, 2001 $(6,300,000)
December 31, 2001 $100,000
March 31, 2002 $3,800,000
June 30, 2002 $7,900,000
September 30, 2002 $10,600,000
December 31, 2002 $12,000,000
March 31, 2003 $14,600,000
June 30, 2003 $22,700,000
September 30, 2003 $24,000,000
December 31, 2003 $27,500,000
March 31, 2004 $33,000,000
June 30, 2004 $39,600,000
September 30, 2004 $47,520,000
December 31, 2004 $57,024,000
March 31, 2005 $68,428,800
June 30, 2005 $82,114,560
(c) a ratio of Indebtedness to EBITDA as at the end of each
quarterly period then ended of not greater than the ratios set forth
opposite each such date:
Date Indebtedness to
---- ---------------
EBITDA
------
March 31, 2002 41.1 : 1.00
June 30, 2002 17.3 : 1.00
September 30, 2002 12.8 : 1.00
December 31, 2002 9.8 : 1.00
March 31, 2003 8.1 : 1.00
June 30, 2003 4.3 : 1.00
September 30, 2003 4.1 : 1.00
December 31, 2003 2.9 : 1.00
March 31, 2004 2.4 : 1.00
June 30, 2004 2.0 : 1.00
September 30, 2004 1.7 : 1.00
December 31, 2004 1.4 : 1.00
March 31, 2005 1.2 : 1.00
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June 30, 2005 1.0 : 1.00
(d) minimum Recurring Revenues, as at the end of each
quarterly period then ended, of not less than the respective amounts
set forth opposite each such date:
Date Recurring Revenues
---- ------------------
March 31, 2000 $8,700,000
June 30, 2000 $9,700,000
September 30, 2000 $13,000,000
December 31, 2000 $16,900,000
March 31, 2001 $22,300,000
June 30, 2001 $27,700,000
September 30, 2001 $30,900,000
December 31, 2001 $35,000,000
March 31, 2002 $39,700,000
June 30, 2002 $43,500,000
September 30, 2002 $48,500,000
December 31, 2002 $53,500,000
March 31, 2003 $59,200,000
June 30, 2003 $63,800,000
September 30, 2003 $67,600,000
December 31, 2003 $71,800,000
March 31, 2004 $ 77,291,552
June 30, 2004 $ 83,203,121
September 30, 2004 $ 89,566,830
December 31, 2004 $ 96,417,260
March 31, 2005 $103,791,640
June 30, 2005 $111,730,041
(e) a minimum number of Subscribers, as at the end of each
quarterly period then ended, of not less than the number of Subscribers
set forth opposite each such date:
Date Subscribers
---- -----------
March 31, 2000 115,000
June 30, 2000 129,000
September 30, 2000 154,000
December 31, 2000 190,000
March 31, 2001 226,000
June 30, 2001 253,000
September 30, 2001 280,000
December 31, 2001 311,000
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March 31, 2002 345,000
June 30, 2002 370,000
September 30, 2002 398,000
December 31, 2002 431,000
March 31, 2003 468,000
June 30, 2003 489,000
September 30, 2003 513,000
December 31, 2003 538,000
March 31, 2004 568,737
June 30, 2004 601,231
September 30, 2004 635,581
December 31, 2004 671,894
March 31, 2005 710,281
June 30, 2005 750,861
(f) a minimum amount of Adjusted Paid-In Capital at all times
for each calendar quarter in an amount equal to the actual cash
requirements for such calendar quarter as provided in the Adjusted
Paid-In Capital Schedule (in the form of Schedule 1.01(c) attached
hereto) provided by the Company as part of the compliance package
delivered with the financial statements required under Sections 8.2 and
8.3. As set forth in the Adjusted Paid-In Capital Schedule (Schedule
1.01(c)), a deficiency in Adjusted Paid-In Capital for any calendar
quarter must be contributed into the Company within fifteen (15) days
from the end of the applicable reporting period.
Notwithstanding anything herein to the contrary (including, without
limitation, the provisions of Section 11.1 hereof), (i) a breach of
Section 8.17(d) hereof shall not constitute an Event of Default
hereunder unless the Company is in breach of such Section 8.17(d) as of
two (2) consecutive quarter end dates and (ii) a breach of Section
8.17(b) or Section 8.17(c) hereof as of any quarter end date shall not
constitute an Event of Default hereunder unless the aggregate
Subscribers as of the end of such quarter were less than the "Target
Subscribers" set forth opposite the quarter end dates set forth in
Schedule 1.01(d)."
SECTION 2. CONDITIONS.
As conditions precedent to the effectiveness of the First
Amendment, each of the following shall have occurred:
2.1 the Company shall have delivered to the Creditor the
First Amendment, duly executed and delivered and appropriately dated
and in form and substance satisfactory to the Creditor;
2.2 the Creditor shall have received an opinion of counsel
for the Company with respect to this amendment, reasonably acceptable
to the Creditor, and shall, within 30 days
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of the date hereof, receive an opinion of Brazilian counsel to the
Company with respect to the collateral in respect of the obligations of
the Company and the other Credit Parties under the Amended and Restated
EFA, as amended by this amendment, such opinion of Brazilian counsel to
be reasonably acceptable to the Creditor;
2.3 each of the Credit Parties shall have, within 10 Business
Days of the date hereof, (a) executed an affirmation of their
obligations in respect of the Amended and Restated EFA and the Credit
Documents to which they are a party, such affirmation to be in form and
substance reasonably satisfactory to the Creditor and (b) a binding
commitment, reasonably acceptable to the Creditor, with respect to the
purchase by the Company and its affiliates of minimum amounts of goods
and services from the Creditor or its affiliates;
2.4 all necessary consents to the First Amendment have been
obtained from third parties, including assignees of the Creditor and
insurers of the payment of Advances;
2.5 the Company shall have delivered such other documents as
the Creditor may reasonably request;
it being understood and agreed that the failure to satisfy any of the
conditions in paragraphs 2.2 and 2.3 above in the time periods
specified shall result in the First Amendment being void ab initio and
of no force and effect.
SECTION 3. REPRESENTATIONS AND WARRANTIES.
To induce the Creditor to enter into the First Amendment, the Company
hereby represents and warrants to the Creditor as of the date hereof (and shall
be deemed to represent and warrant as of the initial date of effectiveness of
this First Amendment) that:
3.1 The representations and warranties contained in the
Amended and Restated EFA and the other Credit Documents are true and
correct in all material respects on and as of the date hereof, except
for representations and warranties that speak as of a particular date,
in which case such representations and warranties are true as of such
date;
3.2 There has been no Material Adverse Effect since September
30, 2000;
3.3 The consolidated audited balance sheets of the Company and
its Subsidiaries and consolidated statements of operations, changes in
stockholders' equity and cash flows of the Company and its Subsidiaries
each as of December 31, 1999, and all other information and data
heretofore furnished by the Company, or any agent of the Company on
behalf of the Company to the Creditor, including, the quarterly (each
as at September 30, 2000) consolidated balance sheets and consolidated
statements of operations, changes in stockholders' equity and cash
flows, have been prepared in
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accordance with GAAP and fairly present the condition and results of
operations of the Company and its Subsidiaries as of such dates or for
such periods;
3.4 Each Credit Party has made all material required
contributions under the Plans for all periods through and September 30,
2000, or adequate accruals therefor have been provided for in the
financial statements referenced in paragraph 3.3 above; and
3.5 After giving effect to the First Amendment, no Default or
Event of Default has occurred and is continuing and all of the
guarantees and Security Documents shall be in full force and effect
with the same priority (and with no need for any additional agreements,
instruments or filings to preserve the effectiveness or priority ) as
in effect immediately prior to the First Amendment.
SECTION 4. GENERAL.
4.1 Reservation of Rights. The Company acknowledges and agrees
that the execution and delivery of the First Amendment shall not be
deemed (i) to create a course of dealing or otherwise obligate the
Creditor to forbear or execute similar amendments under the same or
similar circumstances in the future, or (ii) as a waiver by the
Creditor of any covenant, condition, term or provision of the Amended
and Restated EFA or any of the other Credit Documents, and the failure
of the Creditor to require strict performance by the Company or any
other Credit Party of any provision thereof shall not waive, affect or
diminish any right of the Creditor to thereafter demand strict
compliance therewith. The Creditor hereby reserves all rights granted
under the Amended and Restated EFA, the other Credit Documents and the
First Amendment.
4.2 Full Force and Effect. As hereby modified, the Amended and
Restated EFA and each of the other Credit Documents shall remain in
full force and effect and each is hereby ratified, approved and
confirmed in all respects.
4.3 Affirmation. The Company hereby affirms its obligations
under Section 4 of the Amended and Restated EFA and agrees to pay on
demand all reasonable costs and expenses of the Creditor in connection
with the preparation, execution and delivery of the First Amendment and
all instruments and documents delivered in connection herewith.
4.4 Successors and Assigns. The First Amendment shall be
binding upon and shall inure to the benefit of the Company, the
Creditor and the respective successors and assigns of the Company and
the Creditor.
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4.5 Counterparts. The First Amendment may be executed in any
number of counterparts and by the different parties on separate
counterparts, and each such counterpart shall be deemed to be an
original, but all such counterparts shall together constitute but one
and the same First Amendment.
* * * * *
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IN WITNESS WHEREOF, the Company and the Creditor have executed this
First Amendment as of the 19th day of February, 2001.
COMPANY:
XXXXX INTERNATIONAL (BRAZIL), LTD.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxx
-----------------------------
Title: Vice President and General
Counsel
----------------------------
CREDITOR:
MOTOROLA CREDIT CORPORATION
By: /s/ Xxxx X. Xxxxx
-------------------------------
Name: Xxxx X. Xxxxx
-----------------------------
Title: Vice President
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SCHEDULE 1.01(d)
"TARGET SUBSCRIBERS"
Date Subscribers
---- -----------
March 31, 2000 143,559
June 30, 2000 171,135
September 30, 2000 210,987
December 31, 2000 251,624
March 31, 2001 280,864
June 30, 2001 311,575
September 30, 2001 345,661
December 31, 2001 383,031
March 31, 2002 411,292
June 30, 2002 442,130
September 30, 2002 479,418
December 31, 2002 520,497
March 31, 2003 543,421
June 30, 2003 569,974
September 30, 2003 598,256
December 31, 2003 628,283
March 31, 2004 664,179
June 30, 2004 702,125
September 30, 2004 742,239
December 31, 2004 784,646
March 31, 2005 829,475
June 30, 2005 876,865
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