Exhibit 4.2
FIRST AMENDMENT TO CREDIT AGREEMENT AND CONSENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT AND CONSENT, dated as of May
18, 2004 (this "First Amendment"), is entered into by and among INTERMAGNETICS
GENERAL CORPORATION, a New York corporation (the "Borrower"), certain Domestic
Subsidiaries of the Borrower as Guarantors (the "Guarantors" and together with
the Borrower, the "Credit Parties"), the Required Lenders identified on the
signature pages hereto and WACHOVIA BANK, NATIONAL ASSOCIATION, as
administrative agent for the Lenders (the "Administrative Agent").
WITNESSETH
WHEREAS, the Borrower, the Guarantors, the Administrative Agent and the
Lenders are parties to that certain Credit Agreement dated as of December 17,
2003 (as amended, modified, supplemented or restated from time to time, the
"Credit Agreement"; capitalized terms used herein shall have the meanings
ascribed thereto in the Credit Agreement unless otherwise defined herein);
WHEREAS, the Borrower has requested that the Required Lenders agree to
amend certain provisions of the Credit Agreement and consent to the acquisition
(the "MRI Devices Acquisition") by the Credit Parties of the capital stock of
MRI Devices Corporation (the "Acquired Company"); and
WHEREAS, the Required Lenders have agreed to the amendments requested
by the Borrower and to consent to the MRI Devices Acquisition, subject to the
terms and conditions set forth herein.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
AMENDMENTS
1.1 New Definitions. Section 1.1 of the Credit Agreement is hereby
amended by inserting the following new definitions in the appropriate
alphabetical location:
"Adjusted Consolidated Leverage Ratio" shall mean, as of the end of any
fiscal quarter of the Borrower for the four fiscal quarter period ending on such
date with respect to the Borrower and its Subsidiaries on a consolidated basis,
the ratio of (a) (i) Funded Debt of the Borrower and its Subsidiaries on a
consolidated basis on the last day of such period minus (ii) the amount of cash
and Cash Equivalents held by the Borrower and its Subsidiaries on the last day
of such period to (b) Consolidated EBITDA for such period.
"MRI Devices Acquisition" shall mean the purchase of the outstanding
Capital Stock of MRI Devices Corporation by the Borrower or a Subsidiary of the
Borrower.
1.2 Definition of Acquisition. The Credit Agreement is hereby amended
by deleting all references to the term "Acquisition" (including the defined term
in Section 1.1) and inserting the term "Invivo Acquisition" in substitution
thereof.
1.3 Consolidated EBITDA. The definition of "Consolidated EBITDA" in
Section 1.1 of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:
"Consolidated EBITDA" shall mean, as of any date for the four fiscal
quarter period ending on such date with respect to the Borrower and its
Subsidiaries on a consolidated basis, the sum of (a) Consolidated Net Income,
plus (b) an amount which, in the determination of Consolidated Net Income, has
been deducted for (i) Consolidated Interest Expense, (ii) total federal, state,
local and foreign income, value added and similar taxes, (iii) depreciation and
amortization expense, all as determined in accordance with GAAP and (iv)
non-cash charges taken in connection with the Borrower's executive compensation
plan. Notwithstanding the foregoing, for purposes of calculating (A) the portion
of Consolidated EBITDA attributable to Invivo Research Corporation, Linear
Laboratories Corporation and Medical Data Electronics, Inc. (collectively, the
"Invivo EBITDA"), such Invivo EBITDA for the first three complete fiscal
quarters to occur after the date of the Invivo Acquisition shall be annualized
such that for the first complete fiscal quarter to occur after the date of the
Acquisition such Invivo EBITDA would be multiplied by four (4), the first two
complete fiscal quarters to occur after the date of the Invivo Acquisition, such
Invivo EBITDA would be multiplied by two (2) and the first three complete fiscal
quarters would be multiplied by one and one-third (1 1/3) and (B) the portion of
Consolidated EBITDA attributable to MRI Devices Corporation (the "MRI Devices
EBITDA"), such MRI Devices EBITDA for the first three complete fiscal quarters
to occur after the date of the MRI Devices Acquisition shall be annualized such
that for the first complete fiscal quarter to occur after the date of the MRI
Devices Acquisition, such MRI Devices EBITDA would be multiplied by four (4),
the first two complete fiscal quarters would be multiplied by two (2) and the
first three complete fiscal quarters would be multiplied by one and one-third
(1 1/3).
1.4 Increase to Aggregate Revolving Committed Amount. Section 2.l(a) of
the Credit Agreement is hereby amended by deleting the figure "SEVENTY-FIVE
MILLION DOLLARS ($75,000,000)" and inserting, in substitution thereof, the
figure "ONE HUNDRED FIVE MILLION DOLLARS ($105,000,000)."
1.5 Annual Operating Budget and Cash Flow. Section 5.l(c) of the Credit
Agreement is hereby amended and restated in its entirety to read as follows:
(c) Annual Operating Budget and Cash Flow. As soon as available, but in
any event no later than the earlier of (i) thirty (30) days after the Borrower's
board of directors has approved the operating budget for any fiscal year and
(ii) August 15 of such fiscal year, a copy of such detailed annual operating
budget or plan including cash flow projections of the Borrower and its
Subsidiaries for the next fiscal year prepared on a quarterly basis, in form and
detail reasonably acceptable to the Administrative Agent and the Lenders,
together with a summary of the material assumptions made in the preparation of
such annual budget or plan;
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1.6 Adjusted Consolidated Leverage Ratio. Section 5.9(a) of the Credit
Agreement is hereby amended and restated in its entirety to read as follows:
(a) Adjusted Consolidated Leverage Ratio. The Adjusted Consolidated
Leverage Ratio, as of the last day of each fiscal quarter of the Borrower and
its consolidated Subsidiaries shall be less than or equal to 2.50 to 1.0.
1.7 Consolidated Fixed Charge Coverage Ratio. Section 5.9(b) of the
Credit Agreement is hereby amended and restated in its entirety to read as
follows.
(b) Consolidated Fixed Charge Coverage Ratio. The Consolidated Fixed
Charge Coverage Ratio, as of the last day of each fiscal quarter of the Borrower
and its consolidated Subsidiaries shall be greater than or equal to 1.50 to
1.0.
1.8 Schedule of Lenders and Commitments. Schedule 2.1(a) to the Credit
Agreement is hereby amended and restated in its entirety to read as set forth on
Annex A attached hereto.
SECTION 2
CONSENT
Notwithstanding any terms to the contrary contained in Sections 5.2(f)
or 6.5 of the Credit Agreement, the Required Lenders, for and on behalf of the
Lenders under the Credit Agreement, hereby (a) consent to the MRI Devices
Acquisition and (b) agree that the MRI Devices Acquisition shall be deemed to be
a Permitted Acquisition. This consent shall be effective solely with respect to
the specific circumstances of the MRI Devices Acquisition.
SECTION 3
CLOSING CONDITIONS
3.1 Closing Conditions.
This First Amendment shall be effective as of the date hereof upon
satisfaction of the following conditions precedent, in form and substance
reasonably acceptable to the Administrative Agent:
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(a) First Amendment. The Administrative Agent shall have received a
copy of this First Amendment duly executed by each of the Credit Parties and the
Required Lenders.
(b) Legal Opinion of Counsel. The Administrative Agent shall have
received an opinion of legal counsel for the Credit Parties, dated the as of the
date hereof and addressed to the Administrative Agent and the Lenders, which
opinion shall provide, among other things, that the execution and delivery of
this First Amendment by the Credit Parties and the consummation of the
transactions contemplated hereby will not violate any organizational document or
material agreement of the Credit Parties, and shall otherwise be in form and
substance acceptable to the Administrative Agent and the Lenders.
(c) Officer's Certificate. The Administrative Agent shall have received
a certificate executed by a Responsible Officer of the Borrower as of the date
hereof stating that immediately after giving effect to this First Amendment and
all the transactions contemplated to occur on the date hereof, (A) no Default or
Event of Default exists, (B) all representations and warranties contained in the
First Amendment and in the Credit Agreement and the other Credit Documents are
true and correct (except for those which expressly relate to an earlier date,
which shall have been true and correct at the time they were made), and (C) the
Credit Parties are in compliance with each of the financial covenants set forth
in Section 5.9 to the Credit Agreement on a pro forma basis.
(d) Upfront Fees. The Administrative Agent shall have received a copy
of a fee letter, duly executed by the Borrower, the Administrative Agent and the
Arranger, concerning the upfront fees to be paid by the Borrower to the Lenders
relating to the increase to the Aggregate Revolving Committed Amount.
3.2 Post-Closing Requirements.
(a) Joinder Agreement. As soon as possible, and in any event no later
than ten (10) Business Days after the closing date of the MRI Devices
Acquisition (or such later date as agreed to by the Administrative Agent in its
sole discretion), the Administrative Agent shall have received a Joinder
Agreement duly executed by the Acquired Company and the Borrower, in accordance
with the terms of Section 5.10 of the Credit Agreement.
(b) Authority Documents. As soon as possible, and in any event no later
than ten (10) Business Days after the closing date of the MRI Devices
Acquisition (or such later date as agreed to by the Administrative Agent in its
sole discretion), the Administrative Agent shall have received a certificate
signed by the secretary of the Acquired Company attaching the following
authority documents of Acquired Company and certifying that the same are true
and complete as of the closing date of the MRI Devices Acquisition: (i) a copy
of its articles of incorporation, (ii) a copy of the resolutions of its board of
directors, approving and adopting the Joinder Agreement and the other Credit
Documents, (iii) a copy of its bylaws, (iv) copies of a certificate of good
standing, existence or its equivalent certified as of a recent date by the
appropriate Governmental Authority of its state of incorporation and (v) an
incumbency certificate.
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(c) Legal Opinion. As soon as possible, and in any event no later than
ten (10) Business Days after the closing date of the MRI Devices Acquisition (or
such later date as agreed to by the Administrative Agent in its sole
discretion), the Administrative Agent shall have received a legal opinion from
counsel to the Credit Parties relating to the Acquired Company, in the same form
and substance as the opinions given with respect to the original Guarantors and
in form and substance reasonably satisfactory to the Administrative Agent.
SECTION 4
MISCELLANEOUS
4.1 Amended Terms. The term "Credit Agreement" as used in each of the
Credit Documents shall hereafter mean the Credit Agreement as amended by this
First Amendment. Except as specifically amended or modified hereby or otherwise
agreed, the Credit Agreement is hereby ratified and confirmed and shall remain
in full force and effect according to its terms.
4.2 Representations and Warranties of the Credit Parties. Each of the
Credit Parties represents and warrants to the Lenders as follows:
(a) It has taken all necessary action to authorize the execution,
delivery and performance of this First Amendment.
(b) This First Amendment has been duly executed and delivered by such
Person and constitutes such Person's legal, valid and binding obligations,
enforceable in accordance with its terms, except as such enforceability may be
subject to (i) bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer, moratorium or similar laws affecting creditors' rights generally and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding at law or in equity).
(c) No consent, approval, authorization or order of, or filing,
registration or qualification with, any court or Governmental Authority or third
party is required in connection with the execution, delivery or performance by
such Person of this First Amendment.
(d) The representations and warranties of such Person set forth in
Article III of the 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).
4.3 Reaffirmation of Credit Party Obligations. Each Credit Party hereby
ratifies the Credit Agreement (as amended by this First Amendment) and the other
Credit Documents and acknowledges and reaffirms (a) that it is bound by all
terms of the Credit Agreement (as amended by this First Amendment) and the other
Credit Documents applicable to it and (b) that it is responsible for the
observance and full performance of its respective Credit Party Obligations.
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4.4 Credit Document. This First Amendment shall constitute a Credit
Document under the terms of the Credit Agreement.
4.5 Expenses. The Borrower agrees to pay all reasonable costs and
expenses of the Administrative Agent in connection with the preparation,
execution and delivery of this First Amendment, including, without limitation,
the reasonable fees and expenses of Xxxxx & Xxx Xxxxx, PLLC, and any previously
incurred fees and expenses which remain outstanding on the date hereof,
4.6 Entirety. This First Amendment and the other Credit Documents
embody the entire agreement between the parties hereto and supersede all prior
agreements and understandings, oral or written, if any, relating to the subject
matter hereof.
4.7 Counterparts/Telecopy. This First Amendment may be executed in any
number of counterparts, each of which when so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument.
Delivery of executed counterparts of the First Amendment by telecopy shall be
effective as an original and shall constitute a representation that an original
shall be delivered.
4.8 Governing Law. This First Amendment and the rights and obligations
of the parties under this First Amendment shall be governed by, and construed
and interpreted in accordance with, the law of the State of New York.
4.9 Consent to Jurisdiction; Service of Process; Waiver of Jury Trial.
The jurisdiction, services of process and waiver of jury trial provisions set
forth in Sections 9.14 and 9.17 of the Credit Agreement are hereby incorporated
by reference, mutatis mutandis.
4.10 Further Assurances. The Credit Parties agree to promptly take such
action, upon the request of the Administrative Agent, as is reasonably necessary
to carry out the intent of this First Amendment.
[Signature Pages Follow]
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INTERMAGNETICS CORPORATION
FIRST AMENDMENT TO CREDIT AGREEMENT
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this First Amendment to be duly executed under seal and delivered as of the
date and year first above written.
BORROWER: INTERMAGNETICS GENERAL CORPORATION,
a New York corporation
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: XXXXXXX X. XXXXX
Title: TREASURER
GUARANTORS: INVIVO CORPORATION,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: XXXXXXX X. XXXXX
Title: TREASURER
IGC-POLYCOLD SYSTEMS INC.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: XXXXXXX X. XXXXX
Title: TREASURER
IGC-MEDICAL ADVANCES INC.,
a Wisconsin corporation
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: XXXXXXX X. XXXXX
Title: TREASURER
SUPERPOWER INC.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: XXXXXXX X. XXXXX
Title: TREASURER
INTERMAGNETICS CORPORATION
FIRST AMENDMENT TO CREDIT AGREEMENT
GUARANTORS CONT.: INVIVO RESEARCH CORPORATION,
a California corporation,
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: XXXXXXX X. XXXXX
Title: TREASURER
MEDICAL DATA ELECTRONICS, INC.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: XXXXXXX X. XXXXX
Title: TREASURER
INTERMAGNETICS CORPORATION
FIRST AMENDMENT TO CREDIT AGREEMENT
ADMINISTRATIVE AGENT
AND LENDERS: WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent and as a Lender
By: /s/ Xxxxxxx Xxxxxx
--------------------------------
Name: XXXXXXX XXXXXX
Title: VICE PRESIDENT
INTERMAGNETICS CORPORATION
FIRST AMENDMENT TO CREDIT AGREEMENT
COMERICA BANK
By: /s/ Xxxx X. Xxxxx
--------------------------------
Name: XXXX X XXXXX
Title: Account Representative
INTERMAGNETICS CORPORATION
FIRST AMENDMENT TO CREDIT AGREEMENT
JPMORGAN CHASE BANK
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Name: XXXXX X. XXXXXX
Title: V. President
INTERMAGNETICS CORPORATION
FIRST AMENDMENT TO CREDIT AGREEMENT
KEYBANK, NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxxxxx
--------------------------------
Name: XXXXXX X. XXXXXXXX
Title: SENIOR VICE PRESIDENT
Annex A to First Amendment to Credit Agreement
Schedule 2.1(a)
SCHEDULE OF LENDERS AND
COMMITMENTS
Revolving Revolving LOC LOC Term Loan Term Loan
Committed Commitment Committed Commitment Committed Commitment
Lender Amount Percentage Amount Percentage Amount Percentage
----------------------------------- -------------- ------------- ------------- ------------- ------------- -------------
Wachovia Bank, National Association $36,750,000.00 35.000000000% $3,500,000.00 35.000000000% $8,750,000.00 35.000000000%
----------------------------------- -------------- ------------- ------------- ------------- ------------- -------------
XX Xxxxxx Xxxxx Bank $26,250,000.00 25.000000000% $2,500,000.00 25.000000000% $6,250,000.00 25.000000000%
----------------------------------- -------------- ------------- ------------- ------------- ------------- -------------
Key Bank, N.A. $26,250,000.00 25.000000000% $2,500,000.00 25.000000000% $6,250,000.00 25.000000000%
----------------------------------- -------------- ------------- ------------- ------------- ------------- -------------
Comerica Bank $15,750,000.00 15.000000000% $1,500,000.00 15.000000000% $3,750,000.00 15.000000000%
----------------------------------- -------------- ------------- ------------- ------------- ------------- -------------
Total $105,000,000 100% $10,000,000 100% $25,000,000 100%
----------------------------------- -------------- ------------- ------------- ------------- ------------- -------------
