EXHIBIT 10.1
FIRST AMENDMENT TO AMENDED AND
RESTATED CREDIT AGREEMENT
This Amendment is made as of the 13th day of August, 1997 by and
between The Lamaur Corporation, a Delaware corporation (the "Borrower"),
and Norwest Business Credit, Inc., a Minnesota corporation (the "Lender").
Recitals
The Borrower and the Lender have entered into the Amended and Restated
Credit and Security Agreement dated as of May 16, 1997 (the "Credit
Agreement").
The Lender has agreed to make a term loan, a real estate loan and
certain loan advances to the Borrower pursuant to the terms and conditions
set forth in the Credit Agreement.
The term loan is evidenced by the Borrower's amended and restated term
note dated May 16, 1997 in the original principal amount of $2,300,000, the
real estate loan is evidenced by the Borrower's amended and restated real
estate note dated May 16, 1997 in the original principal amount of
$4,700,000 and the loan advances under the Credit Agreement are evidenced
by the Borrower's amended and restated revolving note dated as of May 16,
1997, in the maximum principal amount of $20,000,000, each of which notes
are payable to the order of the Lender (collectively, the "Note").
All indebtedness of the Borrower to the Lender is secured pursuant to
the terms of the Credit Agreement and all other Security Documents as
defined therein (collectively, the "Security Documents").
The Borrower has requested that certain amendments be made to the
Credit Agreement, which the Lender is willing to make pursuant to the terms
and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, it is agreed as follows:
1. Terms used in this Amendment which are defined in the Credit
Agreement shall have the same meanings as defined therein, unless otherwise
defined herein.
2. The Credit Agreement is hereby amended as follows:
a) Section 1.1 of the Credit Agreement is hereby amended by
adding thereto the following definitions of "Collateral Pledge
Agreement", "Control Agreement", "Investment Account" and
"Investment Property":
"Collateral Pledge Agreement" means that certain Collateral
Pledge Agreement dated August 13, 1997 executed by the
Borrower in favor of the Lender.
"Control Agreement" means that certain Notice of Pledge and
Control Agreement dated August 13, 1997 by and between the
Borrower and the Lender and acknowledged by Norwest
Investment Services, Inc. "Investment Account" means the
Borrower's account no. 00000000 with Norwest Investment
Services, Inc.
"Investment Property" means all of the Borrower's investment
property, as such term is defined in the UCC, deposited or
held in the Investment Account from time to time, whether
now owned or hereafter acquired.
b) Section 1.1 of the Credit Agreement is hereby further amended
by deleting the period at the end of sub-paragraph (b) (ii) of
the definition of "Borrowing Base" contained therein and
replacing the same with ", plus" and by adding to such
definition a new sub-paragraph (iii) as follows:
(iii) the lesser of (A) 100% of the purchase price
of any United States Treasury Securities with an
initial maturity date of not greater than 90 days
held from time to time in the Investment Account, or
(B) $6,000,000.
c) Section 1.1 of the Credit Agreement is hereby further amended
by adding to the definition of "Collateral" contained therein,
the words "Investment Property," immediately before the word
"Equipment".
d) Section 1.1 of the Credit Agreement is hereby further amended
by adding to the definition of "Security Documents" contained
therein, the words "the Collateral Pledge Agreement, the
Control Agreement," immediately after the word
"collectively,".
3. Except as explicitly amended by this Amendment, all of the
terms and conditions of the Credit Agreement shall remain in full
force and effect and shall apply to any loan or advance thereunder.
4. This Amendment shall be effective upon receipt by the Lender
of (a) an executed original hereof, (b) a Certificate of the Secretary
of the Borrower in a form acceptable to the Lender, (c) executed
original UCC amendment documents in form and substance acceptable to
the Lender amending the collateral description to add "Investment
Property" thereto, (d) an original Notice of Pledge and Control
Agreement executed by the Borrower and by Norwest Investment Services,
Inc. in form and substance acceptable to the Lender, and (e) an
original Collateral Pledge Agreement executed by the Borrower in form
and substance acceptable to the Lender.
5. The Borrower hereby represents and warrants to the Lender as
follows:
a) The Borrower has requisite power and authority to execute this
Amendment and to perform all of its obligations hereunder, and this
Amendment has been duly executed and delivered by the Borrower and
constitutes the legal, valid and binding obligation of the Borrower,
enforceable in accordance with its terms.
b) The execution, delivery and performance by the Borrower of this
Amendment have been duly authorized by all necessary corporate action
and do not (i) require any authorization, consent or approval by any
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, (ii) violate any provision of
any law, rule or regulation or of any order, writ, injunction or
decree presently in effect, having applicability to the Borrower, or
the articles of incorporation or by-laws of the Borrower, or (iii)
result in a breach of or constitute a default under any indenture or
loan or credit agreement or any other agreement, lease or instrument
to which the Borrower is a party or by which it or its properties may
be bound or affected.
c) All of the representations and warranties contained in Article V of
the Credit Agreement are correct on and as of the date hereof as
though made on and as of such date, except (i) to the extent that such
representations and warranties relate solely to an earlier date, (ii)
that the Borrower is in default of the Leverage Ratio covenant set
forth in Section 6.14 of the Credit Agreement as of April 30, 1997,
and (iii) the Borrower is in default of its covenant to provide
financial statements to the Lender as and when required under Section
6.1 of the Credit Agreement.
6. All references in the Credit Agreement to "this Agreement"
shall be deemed to refer to the Credit Agreement as amended hereby;
and any and all references in the Security Documents to the Credit
Agreement shall be deemed to refer to the Credit Agreement as amended
hereby.
7. The execution of this Amendment and acceptance of any
documents related hereto shall not be deemed to be a consent to or
waiver of any Default or Event of Default under the Credit Agreement
or breach, default or event of default under any Security Document or
other document held by the Lender, whether or not known to the Lender
and whether or not existing on the date of this Amendment.
8. The Borrower hereby absolutely and unconditionally releases
and forever discharges the Lender, and any and all participants,
parent corporations, subsidiary corporations, affiliated corporations,
insurers, indemnitors, successors and assigns thereof, together with
all of the present and former directors, officers, agents and
employees of any of the foregoing, from any and all claims, demands or
causes of action of any kind, nature or description, whether arising
in law or equity or upon contract or tort or under any state or
federal law or otherwise, which the Borrower has had, now has or has
made claim to have against any such person for or by reason of any
act, omission, matter, cause or thing whatsoever arising from the
beginning of time to and including the date of this Amendment, whether
such claims, demands and causes of action are matured or unmatured or
known or unknown.
9. The Borrower hereby reaffirms its agreement under the Credit
Agreement to pay or reimburse the Lender on demand for all costs and
expenses incurred by the Lender in connection with the Credit
Agreement, the Security Documents and all other documents contemplated
thereby, including without limitation all reasonable fees and
disbursements of legal counsel. Without limiting the generality of the
foregoing, the Borrower specifically agrees to pay all fees and
disbursements of counsel to the Lender for the services performed by
such counsel in connection with the preparation of this Amendment and
the documents and instruments incidental hereto. The Borrower hereby
agrees that the Lender may, at any time or from time to time in its
sole discretion and without further authorization by the Borrower,
make a loan to the Borrower under the Credit Agreement, or apply the
proceeds of any loan, for the purpose of paying any such fees,
disbursements, costs and expenses.
10. This Amendment may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed an
original and all of which counterparts, taken together, shall
constitute one and the same instrument.
11. The Borrower has advised the Lender that the Borrower has
certain funds ("Borrower Funds") on deposit in an account maintained
by the Borrower at the Bank of America (the "Bank of America
Account"). The Borrower has advised the Lender that the Borrower
intends to use a portion of the Borrower Funds to purchase United
States Treasury Securities to be held in the Investment Account. The
Borrower has further advised the Lender that the Borrower may in
future from time to time make a prepayment of the Revolving Note with
some or all of the Borrower Funds. The Lender hereby agrees that the
Lender will not charge any prepayment premium in connection with any
such prepayment. The Lender further agrees that in the event any such
prepayment is made, and the Borrower thereafter desires to obtain an
Advance for purposes of returning an amount less than or equal to the
amount of such prepayment to the Bank of America Account or any other
account owned by the Borrower, subject to the terms and conditions of
the Credit Agreement and so long as (i) no Default or Event of Default
then exists or would occur as a result of any such Advance, and (ii)
Availability after taking into account such Advance is greater than
$1,000,000; the Lender will allow the proceeds of such Advance to be
deposited in the Bank of America Account or such other account
notwithstanding the provisions of Section 2.10 of the Credit Agreement
regarding use of proceeds and notwithstanding the provisions of
Section 7.4(a) of the Credit Agreement regarding investments.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed as of the day and year first above written.
THE LAMAUR CORPORATION
By: __/s/XXXX X. HELLMANN______________
Its: __Vice President, CFO _____________
NORWEST BUSINESS CREDIT, INC.
By: __/s/VIPA CHIRAPRUT________________
Its: _Assistant Vice President_________
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