FOURTH AMENDMENT TO CREDIT AGREEMENT AND CONSENT
This Amendment and Consent (the "Amendment and Consent") dated as of March
31, 2000, is between Bank of America, N.A. (the "Bank"), formerly known as Bank
of America National Trust and Savings Association, and U.S. Home & Garden Inc.
(the "Borrower").
RECITALS
A. The Bank and the Borrower entered into a certain Credit Agreement dated
as of October 13, 1998, as previously amended (the "Agreement").
B. The Borrower desires to acquire xxxxxxxxxx.xxx, a California
corporation, for a total consideration of $400,000. Immediately thereafter, the
Borrower desires to merge the acquired company into the Subsidiary, E-Garden.
The Borrower has requested the Bank to grant its prior written approval of the
Acquisition as required under Section 7.4(d)(ii) of the Agreement and to agree
that the Acquisition is not required to comply with the conditions set forth in
Sections 7.4(d)(iv), 7.4(d)(vii), and 7.4(d)(viii) of the Agreement.
C. The Bank and the Borrower also desire to further amend the Agreement.
AGREEMENT
1. Definitions. Capitalized terms used but not defined in this Amendment
and Consent shall have the meaning given to them in the Agreement.
2. Amendment. The Agreement is hereby amended as follows:
2.1 In Section 1.1, the definition of Revolving Termination Date is
amended by substituting the date "September 30, 2001" for the date "October
15, 2001."
2.2 A new Section 2.7(bb) is inserted between Sections 2.7(b) and
2.7(c), and it reads in its entirety as follows:
(bb) $1,000,000 Prepayments. The Borrower shall prepay the
Facility 1 Loans in three equal principal installments of $1,000,000
on September 30, 2000, December 31, 2000, and June 30, 2001.
2.3 Section 2.8(a) is amended to read in its entirety as follows:
(a) Facility 1 Loans. The Borrower shall repay the following
percentages of the total of the Facility 1 Loans outstanding on the
Revolving Termination Date on the following dates (each a "Principal
Payment Date"):
Year March 31 June 30 September 30 December 31
2001 7.50% 7.50%
2002 7.50% 7.50% 7.50% 7.50%
2003 7.50% 7.50% 10.00% 10.00%
2004 10.00% 10.00%
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And on June 30, 2004, the entire remaining balance of the Facility 1
Loans and all accrued interest thereon shall be immediately due and
payable.
2.4 In Section 7.4(d), clause (v) is amended to read in its entirety
as follows:
(v) after giving effect to the Acquisition (and any financing related
thereto), the pro forma Leverage Ratio is less than 4.50 to 1.00 and
the Borrower and its Subsidiaries are otherwise in pro forma covenant
compliance with Section 7.18,
2.5 In Section 7.4(h), the amount "$2,947,235" is substituted for the
amount "$10,000,000."
2.6 Section 7.11(d) is amended to read in its entirety as follows:
(d) purchase, redeem or otherwise acquire Trust Preferred
Securities, shares of its capital stock or warrants, rights or options
to acquire any shares of its capital stock for cash (i) in an
aggregate amount for all such payments after the Closing Date
(excluding payments for Trust Preferred Securities) not exceeding
$6,074,000 and (ii) with respect to Trust Preferred Securities, in an
aggregate amount not exceeding $1,000,000 for all such payments after
the Closing Date; provided that immediately after giving effect to
such proposed action, no Default would exist, and provided further
that payments for Trust Preferred Securities must be made with the
Borrower's own cash and not with the proceeds of Facility 1 Loans.
2.7 Section 7.18 is amended to read in its entirety as follows:
7.18 Financial Covenants.
(a) Interest Coverage Ratio. The Borrower shall not permit the
Interest Coverage Ratio for any four fiscal quarter period (on a
rolling four quarter basis) to be less than (i) 1.50 to 1.00 for the
four fiscal quarter period ending on Xxxxx 00, 0000, (xx) 1.75 to 1.00
for the four fiscal quarter periods ending on June 30, 2000, September
30, 2000, and December 31, 2000, and (iii) 2.00 to 1.00 for any four
fiscal quarter period ending after December 31, 2000.
(b) Leverage Ratio. The Borrower shall not permit the Leverage
Ratio for any four fiscal quarter period (on a rolling four quarter
basis) to exceed (i) 7.75 to 1.00 for the four fiscal quarter period
ending on Xxxxx 00, 0000, (xx) 5.25 to 1.00 for the four fiscal
quarter period ending on June 30, 2000, (iii) 5.00 to 1.00 for the
four fiscal quarter periods ending on September 30, 2000, December 31,
2000, and March 31, 2001, (iv) 4.50 to 1.00 for the four fiscal
quarter periods ending on June 30, 2001, September 30, 2001, and
December 31, 2001, (v) 4.75 to 1.00 for the four fiscal quarter period
ending on March 31, 2002, and (vi) 4.00 to 1.00 for any four fiscal
quarter period ending after March 31, 2002, except for the four fiscal
quarter periods ending on March 31, 2003, and March 31, 2004,
respectively, for which the Leverage Ratio may not exceed 4.25 to
1.00.
(c) Fixed Charge Coverage Ratio. The Borrower shall not permit
the Fixed Charge Coverage Ratio to be less than (i) 1.10 to 1.00 for
the four
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fiscal quarter period ending on Xxxxx 00, 0000, (xx) 1.50 to 1.00 for the four
fiscal quarter periods (on a rolling four quarter basis) ending on or after June
30, 2000, and on or before March 31, 2002, except for the four fiscal quarter
period ending on December 31, 2000, for which the Fixed Charge Coverage Ratio
may not be less than 1.35 to 1.00, and (iii) 1.25 to 1.00 for any four fiscal
quarter period (on a rolling four quarter basis) ending after March 31, 2002.
(d) Consolidated EBITDA. The Borrower shall not permit
Consolidated EBITDA (Ampro Adjusted) to be less than the following
amounts for the four fiscal quarter periods (on a rolling four quarter
basis) ending on the following dates:
Amount Date
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$12,000,000 March 31, 2000
$15,000,000 June 30, 2000
$15,000,000 September 30, 2000
$15,000,000 December 31, 2000
$16,000,000 March 31, 2001
$16,000,000 June 30, 2001
$16,000,000 September 30, 2001
$16,000,000 December 31, 2001
$17,000,000 March 31, 2002
$17,000,000 June 30, 2002
$17,000,000 September 30, 2002
$17,000,000 December 31, 2002
$17,500,000 March 31, 2003
$17,500,000 June 30, 2003
$17,500,000 September 30, 2003
$17,500,000 December 31, 2003
$18,000,000 March 31, 2004
$18,000,000 June 30, 2004
$18,000,000 September 30, 2004
3. Consent. The Bank hereby consents to the Acquisition described in
Recital B of this Amendment and Consent and hereby agrees that the Acquisition
is not required to comply with the conditions referred to in Recital B of this
Amendment and Consent.
4. Representations and Warranties. When the Borrower signs this Amendment
and Consent, the Borrower represents and warrants to the Bank that:
4.1 No Default or Event of Default has occurred or is continuing under
the Agreement except those Defaults or Events of Default, if any, that have
been disclosed in writing to the Bank or waived in writing by the Bank.
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4.2 The representations and warranties in the Agreement are true as of
the date of this Amendment and Consent as if made on the date of this
Amendment and Consent except to the extent such representations and
warranties expressly refer to an earlier date, in which case they are true
and correct as of such earlier date.
4.3 The execution, delivery and performance by the Borrower of this
Amendment and Consent have been duly authorized by all necessary corporate
and other action and do not and will not require any registration with,
consent or approval of, notice to or action by, any Person (including any
Governmental Authority) in order to be effective and enforceable. The
Agreement as amended by this Amendment and Consent constitutes the legal,
valid and binding obligations of the Borrower, enforceable against it in
accordance with its respective terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally or by equitable principles
relating to enforceability.
5. Effective Date. Provided that the Bank has received from the Borrower a
duly executed original of this Amendment and Consent, this Amendment and Consent
will be deemed effective as of March 31, 2000.
6. Reservation of Rights. The Borrower acknowledges and agrees that the
execution by the Bank of this Amendment and Consent shall not be deemed to
create a course of dealing or otherwise obligate the Bank to execute similar
consents under the same or similar circumstances in the future.
7. Miscellaneous.
7.1 Except as herein expressly amended, all terms, covenants and
provisions of the Agreement are and shall remain in full force and effect
and all references therein and in the other Loan Documents to the Agreement
shall henceforth refer to the Agreement as amended by this Amendment and
Consent. This Amendment and Consent shall be deemed incorporated into, and
a part of, the Agreement. This Amendment and Consent is a Loan Document.
7.2 This Amendment and Consent shall be binding upon and inure to the
benefit of the parties hereto and to the Agreement and their respective
successors and assigns. No third party beneficiaries are intended in
connection with this Amendment and Consent.
7.3 This Amendment and Consent shall be governed by and construed in
accordance with the law of the State of California.
7.4 This Amendment and Consent may be executed in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument.
Each of the parties hereto understands and agrees that this document (and
any other document required herein) may be delivered by any party thereto
either in the form of an executed original or an executed original sent by
facsimile transmission to be followed promptly by mailing of a hard copy
original, and that receipt by the Bank of a facsimile transmitted document
purportedly bearing the signature of the Borrower shall bind the Borrower
with the same force and effect as the delivery of a hard copy original. Any
failure by the Bank to
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receive the hard copy executed original of such document shall not
diminish the binding effect of receipt of the facsimile transmitted
executed original of such document.
This Amendment and Consent is executed as of the date stated at the
beginning of this Amendment and Consent.
Bank of America, N.A.
By /s/ Xxxxxxxx Xxxxxx
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Title Vice President
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By
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Title
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U.S. Home & Garden Inc.
By /s/ Xxxxx Xxxxxxxxx
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Title V.P. Finance
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By
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Title
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