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THIRD AMENDMENT TO CREDIT AGREEMENT AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT AND SECURITY AGREEMENT (this
"Amendment"), dated as of September 30, 1996, 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 of Texas, 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 Credit Agreement dated as of January 12, 1996, as
previously amended (as previously amended, the "Existing Credit Agreement").
WHEREAS, the Borrower, the Guarantors and the Agent entered into that
certain Security Agreement dated as of January 12, 1996, as previously amended
(as previously amended, the "Existing Security Agreement").
WHEREAS, the parties have agreed to amend the Existing Credit
Agreement and the Existing Security Agreement 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
SUBPART I.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.
"Amended Security Agreement" means the Existing Security
Agreement as amended hereby.
"Amendment No. 3 Effective Date" is defined in Subpart 4.1.
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XXXXXXX X.0 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.
PART II
AMENDMENTS TO EXISTING CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the Amendment No. 3
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.
SUBPART II.1 Amendments to Section 1.1.
(a) The definition of "Alternative Assets" set forth in
Section 1.1 of the Existing Credit Agreement is hereby amended in its
entirety to read as follows:
"Alternative Assets" means, in connection with any
proposed Asset Disposition pursuant to the terms of Section
8.4(b)(v), fixed assets (whether new, additional or
replacement assets but exclusive of assets acquired in the
course of regular upkeep and maintenance) which are similar in
nature or purpose to other assets owned or leased by the
Borrower and/or its Subsidiaries prior to or at the time of
the acquisition of such fixed assets and useful in the conduct
of the business of the Borrower and its Subsidiaries as
permitted to be conducted pursuant to Section 8.3.
(b) The definition of "Applicable Percentage" set forth
in Section 1.1 of the Existing Credit Agreement is hereby amended in
its entirety 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 Revolving
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 Consolidated Funded
Debt Coverage Ratio in effect as of the most recent
Calculation Date:
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====================================================================================================================================
Applicable Applicable Applicable Applicable Applicable Applicable
Percentage for Percentage for Percentage for Percentage for Percentage for Percentage
Consolidated Eurodollar Base Rate Eurodollar Base Rate Standby Letter for
Pricing Funded Debt Loans which are Loans which are Loans which Loans which are of Credit Fee Revolving
Coverage Revolving Loans, Revolving Loans are Tranche B Tranche B Term Unused Fee
Ratio Tranche A Term or Tranche A Term Loans Loans
Level Loans or Foreign Term Loans
Currency Loans
------------------------------------------------------------------------------------------------------------------------------------
I Greater than 2.75% 1.50% 3.25% 2.00% 2.75% 0.50%
or equal to
3.50 to 1.00
------------------------------------------------------------------------------------------------------------------------------------
II Greater than 2.50% 1.25% 3.00% 1.75% 2.50% 0.50%
or equal to
3.00 to 1.00
but less than
3.50 to 1.00
------------------------------------------------------------------------------------------------------------------------------------
III Greater than 2.25% 1.00% 3.00% 1.75% 2.25% 0.50%
or equal to
2.50 to 1.00
but less than
3.00 to 1.00
------------------------------------------------------------------------------------------------------------------------------------
IV Greater than 2.00% 0.75% 3.00% 1.75% 2.00% 0.375%
or equal to
2.00 to 1.00
but less than
2.50 to 1.00
------------------------------------------------------------------------------------------------------------------------------------
V Less than 2.00 1.75% 0.50% 3.00% 1.75% 1.75% 0.375%
to 1.00
====================================================================================================================================
Determination of the appropriate Applicable Percentages based
on the Consolidated Funded Debt Coverage Ratio shall be made
for the Calculation Date occurring on December 31, 1996 and on
each Calculation Date thereafter upon receipt by the Agent at
the Agency Services Address of the Required Financial
Information for such Calculation Date. The Consolidated
Funded Debt Coverage 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 December 31, 1996 and on each
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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. The initial
Applicable Percentages shall be based on Pricing Level I until
the first Applicable Percentage Change Date occurring after
November 29, 1996 and 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
Consolidated Funded Debt Coverage Ratio.
(c) The definition of "Applicable Percentage Change Date"
set forth in Section 1.1 of the Existing Credit Agreement is hereby
amended in its entirety to read as follows:
"Applicable Percentage Change Date" means, with
respect to the Calculation Date occurring on December 31, 1996
and any Calculation Date thereafter, a date designated by the
Agent that is not more than five (5) Business Days after
receipt by the Agent at the Agency Services Address of the
Required Financial Information for such Calculation Date.
(d) The definition of "Application Period" set forth in
Section 1.1 of the Existing Credit Agreement is hereby amended in its
entirety to read as follows:
"Application Period" shall have the meaning assigned
to such term in Section 8.4(b)(v).
(e) The definition of "Asset Disposition" set forth in
Section 1.1 of the Existing Credit Agreement is hereby amended in its
entirety to read as follows:
"Asset Disposition" means any sale, lease, transfer
or other disposition (including any such transaction effected
by way of merger, amalgamation or consolidation) by the
Borrower or any of its Subsidiaries subsequent to the Closing
Date of any asset (including stock in Subsidiaries), including
without limitation any sale leaseback transaction (whether or
not involving a Capital Lease), but excluding (a) the sale of
inventory in the ordinary course of business for fair
consideration, (b) the sale or disposition of machinery and
equipment no longer used or useful in the conduct of such
Person's business, (c) the sale or other disposition of the
TIWP Assets in accordance with the terms of Section
8.4(b)(iii) and (d) any Equity Transaction.
(f) The definition of "Asset Disposition Prepayment
Event" set forth in Section 1.1 of the Existing Credit Agreement is
hereby amended in its entirety to read as follows:
"Asset Disposition Prepayment Event" means, with
respect to any Asset Disposition made pursuant to the terms of
Section 8.4(b)(v), the failure of the Borrower to apply (or
cause its applicable Subsidiary to apply) an amount equal to
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the Net Proceeds of such Asset Disposition to the purchase,
acquisition or construction of Alternative Assets during the
Application Period for such Asset Disposition.
(g) The definition of "Collateral" set forth in Section
1.1 of the Existing Credit Agreement is hereby amended in its entirety
to read as follows:
"Collateral" means a collective reference to the
collateral, including without limitation those assets of TIWP
Business acquired pursuant to the Purchase Agreement, which at
any time will be covered by the Collateral Documents.
(h) The definition of "Consolidated EBITDA" set forth in
Section 1.1 of the Existing Credit Agreement is hereby amended in its
entirety to read as follows:
"Consolidated EBITDA" means, for any period, the sum
of (i) Consolidated Net Income for such period (provided,
however, that non-recurring, non-cash charges associated with
the consolidation of certain of the Borrower's facilities to
be identified by the Borrower shall not be taken into account
in calculating any amount determined pursuant to this clause
(i) provided that such charges are taken on or before
September 30, 1997 and do not exceed $4,800,000 in the
aggregate), 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, plus (iii) the pre-tax amount of any
provision associated with environmental remediation and
liabilities related principally to the Borrower's Waynesboro,
Virginia facility accrued during such period, provided that
the aggregate amount of all such items with respect to this
subclause (iii) hereof after September 1, 1996 shall not
exceed $1,500,000, minus (iv) actual cash expenses for such
period associated with the consolidation of certain of the
Borrower's facilities to be identifed by the Borrower.
(i) The definition of "Consolidated Fixed Charge Coverage
Ratio" set forth in Section 1.1 of the Existing Credit Agreement is
hereby amended in its entirety to read as follows:
"Consolidated Fixed Charge Coverage Ratio" means, as
of the end of any period, the ratio of (i) Consolidated EBITDA
for the applicable period minus Consolidated Capital
Expenditures 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.
(j) The definition of "Consolidated Net Worth" set forth
in Section 1.1 of the Existing Credit Agreement is hereby amended in
its entirety to read as follows:
"Consolidated Net Worth" means, at any time, the sum
of (i) total shareholders' equity of the Borrower and its
Subsidiaries on a consolidated basis at such time, as
determined in accordance with GAAP (provided, however, that
(a)
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foreign currency translation adjustments and pension liability
adjustments and (b) non-recurring, non-cash charges associated
with the consolidation of certain of the Borrower's
facilities to be identified by the Borrower shall not be
taken into account in calculating any amount determined
pursuant to this clause (i) provided that such charges are
taken on or before September 30, 1997 and do not exceed
$4,800,000 in the aggregate), plus (ii) the after-tax effect
of any then accrued provisions associated with environmental
remediation and liabilities related principally to the
Borrower's Waynesboro, Virginia facility, provided that the
aggregate amount of all such items with respect to this clause
(ii) hereof after September 1, 1996 shall not exceed
$1,500,000.
(k) The definition of "Net Proceeds" set forth in Section
1.1 of the Existing Credit Agreement is hereby amended in its entirety
to read as follows:
"Net Proceeds" means cash proceeds received by the
Borrower or any of its Subsidiaries from time to time in
connection with any Asset Disposition 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 or Equity Transaction,
as applicable.
(l) The word "and" at the end of existing clause (xi) of
the definition of "Permitted Liens" set forth in Section 1.1 of the
Existing Credit Agreement is hereby deleted, the "." at the end of
existing clause (xii) of such definition is hereby deleted and a ";"
and the word "and" are hereby substituted therefor and the following
new clause (xiii) is hereby added to such definition immediately
succeeding such clause (xii):
"Permitted Liens" means:
**********
(xiii) Liens on Property constituting Collateral and
securing the Indebtedness permitted pursuant to Section
8.1(h), provided that such Liens shall be subordinated to the
Liens of the Agent in such Property on terms satisfactory to
the Agent.
(m) The definition of "Termination Date" set forth in
Section 1.1 of the Existing Credit Agreement is hereby amended in its
entirety to read as follows:
"Termination Date" means (i) as to Revolving Loans,
Letters of Credit (and the related LOC Obligations), Foreign
Currency Loans and the Tranche A Term Loan, December 29, 2000,
and (ii) as to the Tranche B Term Loan, December 27, 2002.
(n) The following definitions are hereby added to Section
1.1 of the Existing Credit Agreement in appropriate alphabetical
order:
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"Agency Services Address" means NationsBank of Texas,
N.A., 000 Xxxx Xxxxxx, Xxxxx 00, Xxxxxx, Xxxxx 00000 Attn:
Agency Services, or such other address as may be identified by
written notice from the Agent to the Borrower.
"Purchase Agreement" means (i) that certain Asset
Purchase Agreement between Texas Instruments and Genicom
Corporation dated as of July 23, 1996 (including all schedules
and exhibits thereto), as amended as of September 30, 1996 and
(ii) all collateral agreements referred to in such Asset
Purchase Agreement.
"Texas Instruments" means Texas Instruments
Incorporated, a Delaware corporation.
"TI Deferred Financing Note" means that certain
subordinated promissory note dated September 30, 1996 executed
by the Borrower in favor of Texas Instruments in the original
principal amount of $9,000,000.
"TIWP Assets" means the raw materials and work in
process, and the equipment, tools and fixtures used in the
manufacturing process of the TIWP Business.
"TIWP Business" means, that certain business (printer
business component) within the Personal Productivity Products
Division of Texas Instruments through which Texas Instruments
operates the design, development, marketing and sale of travel
ticket document printers and readers, impact and laser
printers and other various related technologies.
SUBPART II.2 Amendments to Section 2.5. Subsection (c) of Section
2.5 of the Existing Credit Agreement is hereby amended in its entirety to read
as follows:
2.5 Tranche A Term Loan.
**********
(c) Repayment of Tranche A Term Loan. The principal
amount of the Tranche A Term Loan shall be repaid in eighteen (18)
consecutive quarterly installments as follows:
Tranche A Principal
Payment Date Amortization Payment
------------ --------------------
September 30, 1996 $682,261
December 27, 1996 $700,000
March 28, 1997 $800,000
June 27, 1997 $800,000
September 26, 1997 $800,000
December 26, 1997 $800,000
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Xxxxx 00, 0000 $800,000
June 26, 1998 $800,000
September 25, 1998 $800,000
December 31, 1998 $800,000
March 26, 1999 $1,025,000
June 25, 1999 $1,025,000
September 24, 1999 $1,025,000
December 31, 1999 $1,025,000
March 31, 2000 $1,255,000
June 30, 2000 $1,255,000
September 29, 2000 $1,255,000
December 29, 2000 Remaining principal
balance
SUBPART II.3 Amendments to Section 2.6. Subsections (d) and (e) of
Section 2.6 of the Existing Credit Agreement is hereby amended in its entirety
to read as follows:
2.6 Tranche B Term Loan.
**********
(d) Repayment of Tranche B Term Loan. The principal
amount of the Tranche B Term Loan shall be repaid in twenty-six (26)
consecutive quarterly installments as follows:
Tranche B Principal
Payment Date Amortization Payment
------------ --------------------
September 30, 1996 $113,710
December 27, 1996 $115,000
March 28, 1997 $115,000
June 27, 1997 $115,000
September 26, 1997 $115,000
December 26, 1997 $115,000
March 27, 1998 $115,000
June 26, 1998 $115,000
September 25, 1998 $115,000
December 31, 1998 $115,000
March 26, 1999 $115,000
June 25, 1999 $115,000
September 24, 1999 $115,000
December 31, 1999 $115,000
March 31, 2000 $115,000
June 30, 2000 $115,000
September 29, 2000 $115,000
December 29, 2000 $115,000
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Xxxxx 00, 0000 $1,935,000
June 29, 2001 $1,935,000
September 28, 2001 $1,935,000
December 28, 2001 $1,935,000
March 29, 2002 $2,050,000
September 28, 2002 $2,050,000
November 27, 2002 $2,050,000
December 27, 2002 Remaining principal
balance
(e) Interest. Subject to the provisions of Section 3.1,
the Tranche B Term Loan shall bear interest at a per annum rate equal
to:
(A) Base Rate Loans. During such periods as the
Tranche B Term Loan (or any portion thereof) shall consist of
Base Rate Loans, the Base Rate plus the Applicable Percentage.
(B) Eurodollar Loans. During such periods as the
Tranche B Term Loan (or any portion thereof) shall consist of
Eurodollar Loans, the Eurodollar Rate plus the Applicable
Percentage.
Interest on the Tranche B Term Loan shall be payable in arrears on
each applicable Interest Payment Date (or at such other times as may
be specified herein).
SUBPART II.4 Amendments to Section 3.3. Subsection (c)(i) of Section
3.3 of the Existing Credit Agreement is hereby amended in its entirety to read
as follows:
3.3 Prepayments.
**********
(c) Mandatory Prepayments of Tranche A Term Loan and
Tranche B Term Loan.
(i) Immediately upon the occurrence of any Asset
Disposition Prepayment Event, the Borrower shall prepay the
Tranche A Term Loan and the Tranche B Term Loan 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).
SUBPART II.5 Amendments to Section 6.15. Section 6.15 of the
Existing Credit Agreement is hereby amended in its entirety to read as follows:
6.15 Purpose of Loans and Letters of Credit. The proceeds
of the Loans hereunder shall be used solely by the Borrower for
general corporate purposes of the Borrower and its Subsidiaries,
including, but not limited to, (1) working capital advances,
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(2) capital expenditures in the ordinary course of business, (3)
Permitted Investments and (4) the acquisition of certain assets of the
TIWP Business pursuant to the Purchase Agreement. The Letters of
Credit shall be used only for or in connection with appeal bonds,
reimbursement obligations arising in connection with performance,
surety and reclamation bonds, reinsurance, domestic or international
trade transactions and obligations not otherwise aforementioned
relating to transactions entered into by the Borrower in the ordinary
course of business.
SUBPART II.6 Amendments 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 the sum of
$5,000,000, increased on a cumulative basis by an amount equal to (i)
as of the last day of each fiscal quarter commencing with December 27,
1996, 50% of the Consolidated Net Income (without deduction for any
losses) for the fiscal quarter then ended, plus (ii) as of the date of
any Equity Transaction consummated on or after June 28, 1996, 100% of
the proceeds received from such Equity Transaction.
(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
------ -----
For the period occurring 4.90 to 1.00
from the last day of
the third fiscal quarter
of fiscal year 1996 of
the Borrower and its
Subsidiaries through the
last day of the fourth
fiscal quarter of
fiscal year 1996 of
the Borrower and its
Subsidiaries
For the period occurring 4.40 to 1.00
from the first day of the
first fiscal quarter of
fiscal year 1997 of the
Borrower and its
Subsidiaries through
the last day of the first
fiscal quarter of fiscal
year 1997 of the Borrower
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and its Subsidiaries
For the period occurring 3.90 to 1.00
from the first day of the
second fiscal quarter of
fiscal year 1997 of the
Borrower and its
Subsidiaries through
the last day of the second
fiscal quarter of fiscal
year 1997 of the Borrower
and its Subsidiaries
For the period occurring 3.40 to 1.00
from the first day of the
third fiscal quarter of
fiscal year 1997 of the
Borrower and its
Subsidiaries through
the last day of the third
fiscal quarter of fiscal
year 1997 of the Borrower
and its Subsidiaries
For the period occurring 3.00 to 1.00
from the first day of the
fourth fiscal quarter of
fiscal year 1997 of the
Borrower and its
Subsidiaries and
thereafter
(c) Consolidated Fixed Charge Coverage Ratio. The
Consolidated Fixed Charge Coverage Ratio shall be no less than:
Period Ratio
------ -----
For the period occurring 1.25 to 1.00
from the last day of
the third fiscal quarter
of fiscal year 1996 of
the Borrower and its
Subsidiaries through the
last day of the fourth
fiscal quarter of
fiscal year 1996 of
the Borrower and its
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Subsidiaries
For the period occurring 1.50 to 1.00
from the first day of the
first fiscal quarter of
fiscal year 1997 of the
Borrower and its
Subsidiaries through
the last day of the second
fiscal quarter of fiscal
year 1997 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 1997 of the
Borrower and its
Subsidiaries through
the last day of the third
fiscal quarter of fiscal
year 1997 of the Borrower
and its Subsidiaries
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For the period occurring 2.00 to 1.00
from the first day of the
fourth fiscal quarter of
fiscal year 1997 of the
Borrower and its
Subsidiaries and
thereafter
(d) Consolidated Debt to Capitalization Ratio. The
Consolidated Debt to Capitalization of each Calculation Date shall be
no greater than the following proportions:
Period Ratio
------ -----
For the period occurring 0.70 to 1.00
from the last day of
the third fiscal quarter
of fiscal year 1996 of
the Borrower and its
Subsidiaries through the
last day of the fourth
fiscal quarter of
fiscal year 1996 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 1997 of the
Borrower and its
Subsidiaries through
the last day of the third
fiscal quarter of fiscal
year 1997 of the Borrower
and its Subsidiaries
For the period occurring 0.60 to 1.00
from the first day of the
fourth fiscal quarter of
fiscal year 1997 of the
Borrower and its
Subsidiaries and
thereafter
SUBPART II.7 Amendments to Section 8.1. The word "and" at the end of
existing subsection (f) of Section 8.1 of the Existing Credit Agreement is
hereby deleted, the "." at the end
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of existing subsection (g)(ii) of Section 8.1 of the Existing Credit Agreement
is hereby deleted and a ";" is hereby substituted therefor and the following
new subsections (h) and (i) are hereby added to Section 8.1 of the Existing
Credit Agreement immediately succeeding such subsection (g)(ii):
8.1 Indebtedness. The Borrower will not, nor will it permit
any of its Subsidiaries to, contract, create, incur, assume or permit
to exist any Indebtedness, except:
**********
(h) (i) Indebtedness of the Borrower evidenced by
the TI Deferred Financing Note;
(ii) Guaranty Obligations of any Guarantor in
respect of the Indebtedness of the Borrower evidenced by the
TI Deferred Financing Note.
(i) other Indebtedness of any Foreign Subsidiary
of the Borrower provided that the aggregate principal amount
of all such Indebtedness of all such Persons, taken together
with all Indebtedness outstanding pursuant to Section 8.1(b)
and all Indebtedness outstanding pursuant to Section
8.1(g)(i), shall not exceed the Foreign Currency Equivalent of
$10,000,000.
SUBPART II.8 Amendments to Section 8.4. Subsections (b) and (c) of
Section 8.4 of the Existing Credit Agreement are hereby amended in their
entireties 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:
**********
(b) sell, lease, transfer or otherwise dispose of
any Property (including without limitation pursuant to any
sale leaseback transaction) other than (i) the sale of
inventory in the ordinary course of business for fair
consideration, (ii) the sale or disposition of machinery and
equipment no longer used or useful in the conduct of such
Person's business, (iii) the sale or other disposition of the
TIWP Assets on terms and conditions reasonably satisfactory to
the Agent, (iv) other Asset Dispositions provided that the
aggregate amount of the Net Proceeds of all such Asset
Dispositions during any fiscal year of the Borrower and its
Subsidiaries does not exceed $100,000 and (v) subject to the
terms of Section 8.8, any other Asset Disposition, provided
that, no later than 14 days prior to such Asset Disposition,
the Agent and the Lenders shall have received a certificate of
the chief financial officer or treasurer of the Borrower (A)
providing facts or computations in reasonable detail
demonstrating that (1) the aggregate cumulative book value of
assets disposed of in all the Asset Dispositions occurring on
or after the Closing Date does not exceed 20% of Consolidated
Total Assets as of the most recent Calculation Date with
respect to which the Agent and the Lenders shall have received
the Required Financial Information, (2) the aggregate
cumulative book
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value of assets disposed of in all the Asset Dispositions
occurring during the then current fiscal year of the Borrower
does not exceed 10% of Consolidated Total Assets as of the
most recent Calculation Date with respect to which the Agent
and the Lenders shall have received the Required Financial
Information and (3) after giving effect on a Pro Forma Basis
to such Asset Disposition, no Default or Event of Default
would exist hereunder and (B) specifying the anticipated or
actual date of such Asset Disposition, briefly describing the
assets sold or otherwise disposed of or to be sold or
otherwise disposed of and setting forth the net book value of
such assets and the aggregate consideration and Net Proceeds
to be received for such assets in connection with such Asset
Disposition, and thereafter the Borrower shall, within the 120
day period following the consummation of such Asset
Disposition (with respect to any such Asset Disposition, the
"Application Period"), apply (or cause its applicable
Subsidiary to apply) an amount equal to the Net Proceeds of
such Asset Disposition to the purchase, acquisition or, in the
case of real property, construction of Alternative Assets or
(y) prepay the Loans in connection with such Asset Disposition
to the extent required by Section 3.3(c)(i); or
(c) except as otherwise permitted by Section
8.4(a) and Section 8.5, except for any such transactions with
respect to which the purchase price consists of capital stock
or securities of the acquiring Person and except for the
acquisition by the Borrower of certain assets of the TIWP
Business pursuant to the Purchase Agreement, acquire all or
any portion of the capital stock or securities of any other
Person or purchase, lease or otherwise acquire (in a single
transaction or a series of related transactions) all or any
substantial part of the Property of any other Person without
the consent of each Lender.
SUBPART II.9 Amendments to Section 8.7. Section 8.7 of the Existing
Credit Agreement is hereby amended in its entirety to read as follows:
8.7 Prepayments of Indebtedness, etc. The Borrower will not,
nor will it permit any of its Subsidiaries to, (i) after the issuance
thereof, amend or modify (or permit the amendment or modification of)
any of the terms of any Indebtedness (including without limitation the
Indebtedness evidenced by the TI Deferred Financing Note) if such
amendment or modification would add or change any terms in a manner
adverse to either the issuer of such Indebtedness or any of the
Lenders, or shorten the final maturity or average life to maturity or
require any payment to be made sooner than originally scheduled or
increase the interest rate applicable thereto or change any
subordination provision thereof, (ii) (A) if any Default or Event of
Default has occurred and is continuing or would be directly or
indirectly caused as a result thereof, make (or give any notice with
respect thereto) any voluntary or optional payment or prepayment or
redemption or acquisition for value of (including without limitation,
by way of depositing money or securities with the trustee with respect
thereto before due for the purpose of paying when due), refund,
refinance or exchange of, any other Indebtedness (other than
Intercompany Indebtedness), (B) except as otherwise permitted by
Section 8.6(iv), make any payment or prepayment of any Intercompany
Indebtedness or (C) make any voluntary
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prepayment of the Indebtedness evidenced by the TI Deferred Financing
Note or (iii) amend, modify or change its articles of incorporation
(or corporate charter or other similar organizational document) or
bylaws (or other similar document) where such change would have a
Material Adverse Effect.
SUBPART II.10 Amendments to Section 9.1. The "." at the end of
existing subsection (j) of Section 9.1 of the Existing Credit Agreement is
hereby deleted and a ";" and the word "or" are hereby substituted therefor and
the following new subsection (k) is hereby added to Section 9.1 of the Existing
Credit Agreement immediately succeeding such subsection (j):
9.1 Events of Default. An Event of Default shall exist upon
the occurrence of any of the following specified events (each an
"Event of Default"):
**********
(k) Purchase Price. The aggregate purchase
price, including any post-closing adjustments, paid by the
Borrower and/or any of its Subsidiaries for those assets of
the TIWP Business acquired pursuant to the Purchase Agreement
shall exceed $30,000,000.
SUBPART II.11 Amendments to Schedule 1.1B. Schedule 1.1B to the
Existing Credit Agreement is hereby deleted in its entirety and a new schedule
in the form of Schedule 1.1B to Existing Credit Agreement attached hereto is
substituted therefor.
SUBPART II.12 Amendments to Schedule 1.1C. Schedule 1.1C to the
Existing Credit Agreement is hereby deleted in its entirety and a new schedule
in the form of Schedule 1.1C to Existing Credit Agreement attached hereto is
substituted therefor.
SUBPART II.13 Amendments to Schedule 6.6. Schedule 6.6 to the
Existing Credit Agreement is hereby deleted in its entirety and a new schedule
in the form of Schedule 6.6 to Existing Credit Agreement attached hereto is
substituted therefor.
SUBPART II.14 Amendments to Schedule 6.14. Schedule 6.14 to the
Existing Credit Agreement is hereby deleted in its entirety and a new schedule
in the form of Schedule 6.14 to Existing Credit Agreement attached hereto is
substituted therefor.
SUBPART II.15 Amendments to Schedule 6.16. Schedule 6.16 to the
Existing Credit Agreement is hereby deleted in its entirety and a new schedule
in the form of Schedule 6.16 to Existing Credit Agreement attached hereto is
substituted therefor.
SUBPART II.16 Amendments to Schedule 8.1. Schedule 8.1 to the
Existing Credit Agreement is hereby deleted in its entirety and a new schedule
in the form of Schedule 8.1 to Existing Credit Agreement attached hereto is
substituted therefor.
PART III
AMENDMENTS TO EXISTING SECURITY AGREEMENT
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Effective on (and subject to the occurrence of) the Amendment No. 3
Effective Date, the Existing Security Agreement is hereby amended in accordance
with this Part III. Except as so amended, the Existing Security Agreement
shall continue in full force and effect.
SUBPART III.1 Amendments to Section 2. Subsection (d) of Section 2 of
the Existing Security Agreement is hereby amended in its entirety to read as
follows:
2. Grant of Security Interest in the Collateral. To
secure the prompt payment and performance in full when due, whether by
lapse of time, acceleration or otherwise, of the Secured Obligations
(as defined in Section 3 hereof), each Obligor hereby grants to the
Agent, for the benefit of the Lenders, a continuing security interest
in, and a right to set off against, any and all right, title and
interest of such Obligor in and to the following, whether now owned or
existing or owned, acquired, or arising hereafter (collectively, the
"Collateral"):
**********
(d) All contract rights, including, without
limitation, (i) all rights under the Purchase Agreement,
specifically including the Borrower's rights to
indemnification from Texas Instruments for Texas Instruments'
breach of the warranties set forth in the second sentence of
Section 5.5 of the Purchase Agreement, the second sentence of
Section 5.6 of the Purchase Agreement and the third sentence
of Section 5.7 of the Purchase Agreement, arising under
Section 13.1(b) of the Purchase Agreement, (ii) all rights
under management agreements, tax sharing agreements and lease
agreements and (iii) all rights to payment of money, tax
refunds and insurance proceeds;
SUBPART III.2 Amendments to Section 4. Subsections (b) and (g) of
Section 4 of the Existing Security Agreement is hereby amended in its entirety
to read as follows:
4. Representations and Warranties. Each Obligor hereby
represents and warrants to the Agent, for the benefit of the Lenders,
that so long as the Credit Agreement is in effect or any amounts
payable thereunder or under any other Credit Document or any Letter of
Credit shall remain outstanding, and until all of the Commitments
thereunder shall have terminated:
***********
(b) Type and Location of Collateral. The type of
Collateral located in the United States of America
owned by such Obligor, each location of Collateral
located in the United States of America owned by such
Obligor having an aggregate book value at such
location of $100,000 or more and the owner of each
such location for which the Agent has required the
Borrower to provide a landlord waiver is as shown on
Schedule 2 attached hereto.
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**********
(g) Intellectual Property. With regard to the
Collateral of such Obligor consisting of Intellectual
Property, (i) such Obligor is the present owner of
the entire right, title and interest in and to such
Collateral and has good and indefeasible title
thereto with the rights of use free and clear of the
infringement of the rights of others, (ii) the United
States patents listed on Schedule 4 constitute all of
the registrations and applications for the United
States patents owned by such Obligor, (iii) the
United States trademarks listed on Schedule 5
constitute all of the registrations and applications
for the United States trademarks owned by such
Obligor, (iv) such Obligor has not and will not make
any assignment or agreement in conflict with the
security interest in the Intellectual Property of
such Obligor hereunder and (v) all applications
pertaining to U.S. Intellectual Property of such
Obligor have been duly and properly filed, and all
U.S. registrations or letters pertaining to such
Intellectual Property have been duly and properly
filed and issued, and all of such Intellectual
Property is valid and enforceable.
SUBPART III.3 Amendments to Schedule 1. Schedule 1 to the Existing
Security Agreement is hereby deleted in its entirety and a new schedule in the
form of Schedule 1 to Existing Security Agreement attached hereto is
substituted therefor.
SUBPART III.4 Amendments to Schedule 2. Schedule 2 to the Existing
Security Agreement is hereby deleted in its entirety and a new schedule in the
form of Schedule 2 to Existing Security Agreement attached hereto is
substituted therefor.
SUBPART III.5 Amendments to Schedule 4. Schedule 4 to the Existing
Security Agreement is hereby deleted in its entirety and a new schedule in the
form of Schedule 4 to Existing Security Agreement attached hereto is
substituted therefor.
SUBPART III.6 Amendments to Schedule 5. Schedule 5 to the Existing
Security Agreement is hereby deleted in its entirety and a new schedule in the
form of Schedule 5 to Existing Security Agreement attached hereto is
substituted therefor.
PART IV
CONDITIONS TO EFFECTIVENESS
SUBPART IV.1 Amendment No. 3 Effective Date. This Amendment shall
be and become effective as of the date hereof (the "Amendment No. 3 Effective
Date") when all of the conditions set forth in this Subpart 4.1 shall have been
satisfied, and thereafter this Amendment shall be known, and may be referred
to, as "Amendment No. 3."
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SUBPART 4.1.1 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.
SUBPART 4.1.2 Financing Statements, etc. The Agent shall
have received fully executed original UCC-3 or UCC-1 financing
statements, as appropriate, in form and substance satisfactory to the
Agent from each Credit Party, in each case in sufficient numbers in
order to effect a filing in each location where a UCC filing is
required (as determined by the Agent and its counsel) in order to
perfect the Liens in favor of the Agent for the benefit of the Lenders
arising under the Collateral Documents on the Collateral consisting of
TIWP Assets; and (ii) such patent/trademark filings as requested by
the Agent in order to perfect the Agent's security in the Collateral
consisting of TIWP Assets.
SUBPART 4.1.3 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.
SUBPART 4.1.4 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.
SUBPART 4.1.5 Officer's Certificate. The Agent shall have
received a certificate executed by the chief financial officer of the
Borrower as of the Amendment No. 3 Effective Date stating that,
immediately after giving effect to this Amendment, (i) each of the
Credit Parties is Solvent, (ii) no Default or Event of Default exists
and (iii) the representations and warranties set forth in the Existing
Credit Agreement are true and correct in all material respects.
SUBPART 4.1.6 Insurance. The Agent shall have received
copies of insurance policies or certificates of insurance of the
Credit Parties evidencing liability and casualty insurance meeting the
requirements of the Credit Documents with respect to those assets of
the TIWP Business acquired pursuant to the Purchase Agreement.
SUBPART 4.1.7 Material Adverse Change. Except as otherwise
previously disclosed in writing to the Lenders (including without
limitation the forecast trend by business unit dated September 13,
1996), no material adverse change shall have occurred since June 30,
1996 in the condition (financial or otherwise), business or management
of the Borrower or of the Borrower and its Subsidiaries taken as a
whole, and no material adverse change shall have occurred in the
condition (financial or otherwise) of the TIWP Business (other than
portions of the TIWP Business related to the design, development,
marketing and sale of laser printer hardware) since the date of the
most current financial statements for the TIWP Business delivered to
the Lenders prior to the date hereof.
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SUBPART 4.1.8 Purchase Agreement. The Agent shall have
received a copy, certified by the chief financial officer of the
Borrower as true and complete, of the Purchase Agreement and of each
other document or instrument executed by the Borrower in connection
with the Purchase Agreement, in each case as originally executed and
delivered, and, no amendment or modification thereof shall have been
entered into on or prior to the date hereof which shall not have been
approved by the Agent.
SUBPART 4.1.9 Consummation of Purchase Agreement. The
Agent shall have received evidence satisfactory to it that (i) the
Purchase Agreement shall have been consummated in compliance with
applicable law and regulatory approvals and in accordance with the
terms thereof and (ii) the aggregate purchase price (including cash
and non-cash consideration, but without giving effect to post-closing
adjustments) paid by the Borrower and/or any of its Subsidiaries for
the TIWP Business acquired pursuant to the Purchase Agreement does not
exceed $28,000,000.
SUBPART 4.1.10 Financial Statements. The Agent shall have
received (i) the consolidated financial statements of the TIWP
Business for each of the two years ending December 31, 1994 and 1995,
and for the most recent fiscal quarter, including income statements
and certain balance sheet and cash flow items, (ii) a satisfactory pro
forma consolidated balance sheet of the Borrower as of the date hereof
giving effect to the acquisition of those assets of the TIWP Business
acquired pursuant to the Purchase Agreement and the other transactions
contemplated by the Purchase Agreement and (iii) a satisfactory pro
forma income statement and certain cash flow items for the TIWP
Business for fiscal year 1996.
SUBPART 4.1.11 TI Deferred Financing Note. The Agent shall
have received a copy, certified by the chief financial officer of the
Borrower as true and complete, of the TI Deferred Financing Note as
originally executed and delivered, and no amendment or modification
thereof shall have been entered into on or prior to the Amendment No.
3 Effective Date which shall not have been approved by the Agent.
SUBPART 4.1.12 Manufacturing Agreement. The Borrower shall
have entered, or shall be in the process (reasonably satisfactory to
the Agent) of entering, with an independent third party reasonably
acceptable to the Agent, into an agreement providing for the
production of product lines of the TIWP Business for the period
subsequent to the term of that certain servicing agreement between
Borrower and Texas Instruments dated as of the Amendment No. 3
Effective Date.
SUBPART 4.1.13 TIWP Business. The Agent shall have received
satisfactory evidence that the Agent, on behalf of the Lenders, holds
a perfected, first priority Lien, subject to no other Liens other than
for Permitted Liens, on those assets of the TIWP Business acquired
pursuant to the Purchase Agreement.
SUBPART 4.1.14 Amendment Fee. The Agent shall have received,
for the account of each Lender, an amendment fee equal to 37.5 basis
points on the aggregate amount of such Lender's Commitment.
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SUBPART 4.1.15 Amendment Arrangement Fee. The Agent shall
have received, for its own account, the amendment arrangement fee
separately agreed to by the Borrower and the Agent.
SUBPART 4.1.16 Other Items. The Agent shall have received
such other documents, agreements or information which may be
reasonably requested by the Agent.
PART V
GRANTING OF SECURITY INTEREST
SUBPART V.1 Grant of Security Interest. To secure the prompt payment
and performance in full when due, whether by lapse of time, acceleration or
otherwise, of the Secured Obligations (as defined in Section 3 of the Existing
Security Agreement), each Obligor (as defined in the Existing Security
Agreement) hereby grants to the Agent, for the benefit of the Lenders, a
continuing security interest in, and a right to set off against, any and all
right, title and interest of such Obligor in and to all contract rights,
including, without limitation, (a) (i) all rights under the Purchase Agreement,
specifically including the Borrower's rights to indemnification from Texas
Instruments for Texas Instruments' breach of the warranties set forth in the
second sentence of Section 5.5 of the Purchase Agreement, the second sentence
of Section 5.6 of the Purchase Agreement and the third sentence of Section 5.7
of the Purchase Agreement, arising under Section 13.1(b) of the Purchase
Agreement, (ii) all rights under management agreements, tax sharing agreements
and lease agreements and (iii) all rights to payment of money, tax refunds and
insurance proceeds, and all proceeds and products of the foregoing and all
insurance relating thereto and all proceeds of such insurance, whether now
existing or hereafter arising and (b) all other TIWP Assets constituting
Collateral, as such term is defined in the Existing Security Agreement,
including without limitation all TIWP Assets at the locations set forth on
Schedule 2A attached hereto and the trademarks and trademark applications
identified on Schedule 5A attached hereto.
The Obligors, the Lenders and the Agent hereby agree that,
notwithstanding anything to the contrary contained in the Existing Security
Agreement, the Obligors shall not be deemed to have assigned, and the Agent
shall not be deemed to have taken an assignment of, any "intent to use" federal
trademark registration application until such time as either (i) an amendment
alleging use with respect to the related trademark shall have been accepted for
filing by the U.S. Patent & Trademark Office or (ii) applicable law
conclusively allows earlier assignment.
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PART VI
MISCELLANEOUS
SUBPART VI.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 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).
SUBPART VI.2 Cross-References. References in this Amendment to any
Part or Subpart are, unless otherwise specified, to such Part or Subpart of
this Amendment.
SUBPART VI.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.
SUBPART VI.4 References in Other Credit Documents. At such time as
this Amendment No. 3 shall become effective pursuant to the terms of Subpart
4.1, 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. 3. and
all references in the Credit Documents to the "Security Agreement" shall be
deemed to refer to the Security Agreement as amended by this Amendment No. 3.
SUBPART VI.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.
SUBPART VI.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.
SUBPART VI.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]
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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 and CFO
GUARANTORS:
----------
GENICOM INTERNATIONAL HOLDINGS CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President and CFO
GENICOM INTERNATIONAL SALES CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President and CFO
DELMARVA TECHNOLOGIES CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President and CFO
RASTEK CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President and CFO
ENTERPRISING SERVICE SOLUTIONS CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President and CFO
[Signatures Continued]
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PRINTER SYSTEMS CORPORATION
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President and CFO
THE PRINTER CONNECTION, INC.
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President and CFO
PRINTER SYSTEMS INTERNATIONAL, LTD.
By /s/ Xxxxx X. Xxxx
Title: Senior Vice President and CFO
[Signatures Continued]
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LENDERS:
--------
NATIONSBANK OF TEXAS, N.A.
By /s/ Xxxxx X. Xxxxxx
Title: Vice President
CREDITANSTALT-BANKVEREIN
By
-----------------------------
Title:
By
-----------------------------
Title:
AERIES FINANCE, LTD.
By /s/ Xxx Xxxxx
-----------------------------
Title: Director
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By /s/ Xxxxx X X'Xxxxxx
Title: Treasurer
RESTRUCTURED OBLIGATIONS BACKED BY
SENIOR ASSETS, B.V.
By /s/ Xxxxxxxxxxx X. Xxxxx
Title: Vice President
UNITED STATES NATIONAL BANK OF OREGON
By /s/ Xxxxxxx X. Xxxx
Title: Vice President
[Signatures Continued]
X-00
00
XXXXXXX XXXX
By /s/ Xxxxxxx X. Xxxxxxx
Title: Vice President
THE XXXXX NATIONAL BANK OF
WASHINGTON, D.C.
By /s/ Xxx X. Xxxx
Title: Vice President
AGENT:
NATIONSBANK OF TEXAS, N.A.,
as Agent
By /s/ Xxxxx X. Xxxxxx
Title: Vice President
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