EXHIBIT 10.38
FIRST AMENDMENT TO PLEDGE AGREEMENT AND SECURITY AGREEMENT
THIS FIRST AMENDMENT TO PLEDGE AGREEMENT AND SECURITY AGREEMENT (this
"AMENDMENT"), dated as of June 27, 2000, is by and among STERILE RECOVERIES,
INC., a Florida corporation (the "BORROWER"), certain Subsidiaries of the
Borrower identified on the signature pages hereto (each a "GUARANTOR", and
collectively, the "GUARANTORS"), the Lenders identified on the signature pages
hereto (the "LENDERS") and FIRST UNION NATIONAL BANK, in its capacity as
collateral agent for the Lenders and the ELLF Lender (the "AGENT").
W I T N E S S E T H:
WHEREAS, the Lenders and the ELLF Lender have each required that the
Obligors secure their obligations to the Lenders and the ELLF Lender,
respectively in accordance with the terms of the Security Agreement and the
Pledge Agreement;
WHEREAS, the parties hereto have agreed to amend the Security Agreement
and Pledge Agreement as set forth herein;
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereby agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. 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:
"EFFECTIVE DATE" is defined in SUBPART 4.1.
SUBPART 1.2. 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
Security Agreement or Pledge Agreement, as applicable.
PART II
AMENDMENTS TO PLEDGE AGREEMENT
Effective on (and subject to the occurrence of) the Effective Date, the
Pledge Agreement is hereby amended in accordance with this Part II. Except as so
amended, the Pledge Agreement shall continue in full force and effect.
SUBPART 2.1. SECURED OBLIGATIONS. Clause (a) of the definition
of Secured Obligations in Section 1 of the Pledge Agreement is amended
and restated in its entirety to read as follows:
"SECURED OBLIGATIONS": means a collective reference
to the following:
(a) All unpaid principal of and interest on the Loans
(as defined in the Credit Agreement), all LOC Obligations (as
defined in the Credit Agreement) and all other obligations and
liabilities of the Pledgors to the Credit Agreement Agent and
the Lenders (including, without limitation, interest accruing
at the then applicable rate provided in the Credit Agreement
after the maturity of the Loans and interest accruing at the
then applicable rate provided in the Credit Agreement after
the filing of any petition in bankruptcy, or the commencement
of any insolvency, reorganization or like proceeding, relating
to any Pledgor, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), whether
direct or indirect, absolute or contingent, due or to become
due, now existing or hereafter incurred, which may arise
under, out of, or in connection with, the Credit Agreement,
any notes issued thereunder, any Hedging Agreement with a
Lender or an affiliate of a Lender to the extent permitted
under the Credit Agreement or any other document made,
delivered or given in connection therewith, whether on account
of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the
Credit Agreement Agent or the Lenders that are required to be
paid by the Pledgors pursuant to the terms of the Credit
Agreement, any other Credit Document or any Hedging Agreement
with a Lender or an affiliate of a Lender to the extent
permitted under the Credit Agreement);
SUBPART 2.2. APPLICATION OF PROCEEDS. Section 10 of the Pledge
Agreement is amended and restated in its entirety to read as follows:
10. APPLICATION OF PROCEEDS. Upon the occurrence of and during
the continuance of an Event of Default, the Proceeds and avails of the
Pledged Collateral at any time received by the Agent shall, when
received by the Agent in cash or its equivalent, be applied as follows:
FIRST, to all reasonable costs and expenses of the Agent (including
without limitation, reasonable attorneys' fees and expenses) incurred
in connection with the implementation and/or enforcement
of this Pledge Agreement; SECOND, to the payment of any fees owed to
the Credit Agreement Agent; THIRD, to all costs and expenses of the
Lenders (including without limitation reasonable attorneys' fees and
expenses of a single counsel for the Lenders) incurred in connection
with the implementation and/or enforcement of this Pledge Agreement
and/or any of the other Credit Documents; FOURTH, to the Lenders,
ratably, in accordance with the respective amounts of the Secured
Obligations constituting the then aggregate unpaid principal amount of
the Loans, together with all accrued and unpaid interest thereon at
such time and LOC Obligations; FIFTH, to all other amounts payable to
the Lenders with respect to the Secured Obligations; SIXTH, to the
payment of any fees owed to the ELLF Lender; SEVENTH, to all costs and
expenses of the ELLF Lenders (including without limitation reasonable
attorneys' fees and expenses) incurred in connection with the
implementation and/or enforcement of this Pledge Agreement and/or any
of the Operative Agreements; EIGHT, to the ELLF Lender, ratably, in
accordance with the respective amounts of the Secured Obligations
constituting the then aggregate unpaid principal amount and/or advanced
amounts owing pursuant to the ELLF Documents together with all accrued
and unpaid interest and/or yield thereon at such time; NINTH, to all
other amounts payable to the ELLF Lender with respect to the Secured
Obligations; and TENTH, to the payment of the surplus, if any, to
whoever may be lawfully entitled to receive such surplus. The Pledgors
shall remain liable to the Agent and the Secured Parties on a joint and
several basis for any deficiency.
PART III
AMENDMENTS TO SECURITY AGREEMENT
Effective on (and subject to the occurrence of) the Effective Date, the
Security Agreement is hereby amended in accordance with this Part III. Except as
so amended, the Security Agreement shall continue in full force and effect.
SUBPART 2.1. SECURED OBLIGATIONS. Clause (a) of the definition
of Secured Obligations in Section 1 of the Security Agreement is
amended and restated in its entirety to read as follows:
"SECURED OBLIGATIONS": means a collective reference
to the following:
(a) All unpaid principal of and interest on the Loans
(as defined in the Credit Agreement), all LOC Obligations (as
defined in the Credit Agreement) and all other obligations and
liabilities of the Obligors to the Credit Agreement Agent and
the Lenders (including, without limitation, interest accruing
at the then applicable rate provided in the Credit Agreement
after the maturity of the Loans and interest accruing at the
then applicable rate provided in the Credit Agreement
after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like
proceeding, relating to any Obligor, whether or not a claim
for post-filing or post-petition interest is allowed in such
proceeding), whether direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter
incurred, which may arise under, out of, or in connection
with, the Credit Agreement, any notes issued thereunder, any
Hedging Agreement with a Lender or an affiliate of a Lender to
the extent permitted under the Credit Agreement or any other
document made, delivered or given in connection therewith,
whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise
(including, without limitation, all fees and disbursements of
counsel to the Credit Agreement Agent or the Lenders that are
required to be paid by the Obligors pursuant to the terms of
the Credit Agreement, any other Credit Document or any Hedging
Agreement with a Lender or an affiliate of a Lender to the
extent permitted under the Credit Agreement);
SUBPART 2.2. SECTION 2. The last sentence of Section 2 of the
Security Agreement is amended and restated in its entirety to read as
follows:
Notwithstanding anything to the contrary herein, the Obligors and the Agent, on
behalf of the Secured Parties, hereby acknowledge and agree that (i) the
security interest created hereby in the Collateral (a) constitutes continuing
collateral security for all of the Secured Obligations, whether now existing or
hereafter arising and (b) is not to be construed as an assignment in the nature
of a sale of any Copyrights, Copyright Licenses, Patents, Patent Licenses,
Trademarks or Trademark Licenses and (ii) the Collateral shall not include any
Trust Property (as such term is defined in Security Agreement (as defined in
Appendix A of the Participation Agreement)).
SUBPART 2.3. APPLICATION OF PROCEEDS. Section 11 of the
Security Agreement is amended and restated in its entirety to read as
follows:
11. APPLICATION OF PROCEEDS. Upon the occurrence of
and during the continuance of an Event of Default, the
Proceeds and avails of the Collateral at any time received by
the Agent shall, when received by the Agent in cash or its
equivalent, be applied as follows: first, to all reasonable
costs and expenses of the Agent (including without limitation,
reasonable attorneys' fees and expenses) incurred in
connection with the implementation and/or enforcement of this
Security Agreement; SECOND, to the payment of any fees owed to
the Credit Agreement Agent; THIRD, to all costs and expenses
of the Lenders (including without limitation reasonable
attorneys' fees and expenses of a single counsel for the
Lenders) incurred in connection with the implementation and/or
enforcement of this Security Agreement and/or any of the other
Credit Documents; FOURTH, to the Lenders, ratably, in
accordance with the respective amounts of the Secured
Obligations constituting the then aggregate unpaid principal
amount of the Loans, together with all accrued and unpaid
interest thereon at such time and LOC
Obligations; FIFTH, to all other amounts payable to the
Lenders with respect to the Secured Obligations; SIXTH, to the
payment of any fees owed to the ELLF Lender; SEVENTH, to all
costs and expenses of the ELLF Lenders (including without
limitation reasonable attorneys' fees and expenses) incurred
in connection with the implementation and/or enforcement of
this Security Agreement and/or any of the Operative
Agreements; EIGHT, to the ELLF Lender, ratably, in accordance
with the respective amounts of the Secured Obligations
constituting the then aggregate unpaid principal amount and/or
advanced amounts owing pursuant to the ELLF Documents together
with all accrued and unpaid interest and/or yield thereon at
such time; NINTH, to all other amounts payable to the ELLF
Lender with respect to the Secured Obligations; and TENTH, to
the payment of the surplus, if any, to whoever may be lawfully
entitled to receive such surplus. The Obligors shall remain
liable to the Agent and the Secured Parties on a joint and
several basis for any deficiency.
PART IV
CONDITIONS TO EFFECTIVENESS
SUBPART 4.1. EFFECTIVE DATE. This Amendment shall be and
become effective as of the date hereof (the "EFFECTIVE DATE") when all
of the conditions set forth in this PART IV shall have been satisfied.
SUBPART 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, the Agent and the Required
Lenders.
PART V
MISCELLANEOUS
SUBPART 5.1. CROSS-REFERENCES. References in this Amendment to
any Part or Subpart are, unless otherwise specified, to such Part or
Subpart of this Amendment.
SUBPART 5.2. ACKNOWLEDGMENT. The Guarantors (i) acknowledge
and consent to all of the terms and conditions of this Amendment, (ii)
affirm all of their obligations under the Pledge Agreement and Security
Agreement and (iii) agree that this Amendment and all documents
executed in connection herewith do not operate to reduce or discharge
the Guarantors' obligations under the Credit Documents or the ELLF
Documents.
SUBPART 5.3. 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.
SUBPART 5.4. GOVERNING LAW. THIS AMENDMENT SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE
OF FLORIDA WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF.
SUBPART 5.5. SUCCESSORS AND ASSIGNS. This Amendment shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
Each of the parties hereto has caused a counterpart of this Amendment to be duly
executed and delivered as of the date first above written.
BORROWER: STERILE RECOVERIES, INC.,
a Florida corporation
By: /s/ D. XXX XXXXXXX
----------------------------
Name: D. Xxx XxXxxxx
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Title: Vice President
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GUARANTOR: XXXXX SURGICAL ENTERPRISES, INC.,
an Ohio corporation
By: /s/ D. XXX XXXXXXX
----------------------------
Name: D. Xxx XxXxxxx
--------------------------
Title: Vice President
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AGENT: FIRST UNION NATIONAL BANK
individually in its capacity as
a Lender and in its
capacity as Agent
By: /s/ XXXXX XXXXX
----------------------------
Name: Xxxxx Xxxxx
--------------------------
Title: SVP
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Consented to as of the date hereof: FIRST UNION NATIONAL BANK,
in its capacity as ELLF Lender
By: /s/ XXXXX XXXXX
----------------------------
Name: Xxxxx Xxxxx
--------------------------
Title: SVP
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