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CONNECTIVITY PRODUCTS INCORPORATED
SIXTH AMENDMENT
TO
AMENDED AND RESTATED
REVOLVING CREDIT AND TERM LOAN AGREEMENT
This SIXTH AMENDMENT (this "Amendment"), dated as of July 11, 1997, is
among CONNECTIVITY PRODUCTS INCORPORATED, a Delaware corporation (the
"Borrower"), NBD BANK as Administrative Agent (the "Administrative Agent"),
BANKBOSTON, N.A., f/k/a THE FIRST NATIONAL BANK OF BOSTON as Documentation Agent
(the "Documentation Agent", and together with the Administrative Agent, the
"Co-Agents") for the lending institutions (the "Banks") listed on Schedule 1 to
the Credit Agreement (as hereinafter defined) and the Banks.
WHEREAS, the Borrower, the Banks and the Co-Agents are parties to that
certain Amended and Restated Revolving Credit and Term Loan Agreement, dated as
of May 31, 1996 (as amended by the First Amendment to Amended and Restated
Revolving Credit and Term Loan Agreement, dated as of August 26, 1996, the
Second Amendment to Amended and Restated Revolving Credit and Term Loan
Agreement, dated as of September 30, 1996, the [First Amendment of Certain
Security Documents and Subordination Agreement and] Third Amendment to Amended
and Restated Revolving Credit and Term Loan Agreement, dated as of February 24,
1997, the Fourth Amendment to Amended and Restated Revolving Credit and Term
Loan Agreement, dated as of March 31, 1997, and the Fifth Amendment to Amended
and Restated Revolving Credit and Term Loan Agreement, dated as of June 27, 1997
the "Credit Agreement"), pursuant to which the Banks, upon certain terms and
conditions, have made loans to and may issue letters of credit for the benefit
of the Borrower; and
WHEREAS, the Borrower had requested that the Banks agree, and the Banks
have agreed, on the terms and subject to the conditions set forth herein, to
make certain changes to the Credit Agreement;
NOW, THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. DEFINED TERMS. Capitalized terms which are used herein without
definition and which are defined in the Credit Agreement shall have the same
meanings herein as in the Credit Agreement.
SECTION 2. AMENDMENT OF CREDIT AGREEMENT. The Credit Agreement is hereby
amended as follows:
(a) Section 1.1 of the Credit Agreement is amended as follows:
(i) the definition of Applicable Margin is amended by deleting the
table contained in such definition and restating it in its entirety
as follows:
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Base Rate LIBOR Rate Commitment
Coverage Ratio Loans Loans Fee
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Less than 4.00 and 1.00% 2.75% .500%
Greater than 3.00:1.00
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Less than 3.00 and 0.50% 2.25% .500%
Greater than 2.00:1.00
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Less than 2.00:1.00 0.00% 1.75% .375%
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(ii) the definition of Conversion Date is amended by deleting the
date "May 31, 1998" and substituting the date "May 31, 1999"
therefor.
(iii) the definition of Term Loan A is amended deleting the amount
"$18,600,000" and substituting the amount "$12,000,000" therefor.
(iv) the definition of Security Documents is amended by adding the
text "the Borrower Stock Pledge Agreement," immediately after the
term "Stock Pledge Agreement," contained in such definition.
(b) Section 1.1 of the Credit Agreement is further amended by adding the
following new definition in the appropriate alphabetical order:
Borrower Stock Pledge Agreement. The Stock Pledge Agreement, dated as of
July 11, 1997, between the Borrower and the Administrative Agent and in
form and substance satisfactory to the Banks and the Co-Agents.
(c) Section 4.4.1 of the Credit Agreement is amended by deleting such
Section 4.4.1 and restating it in its entirety as follows:
4.4.1. TERM LOAN A. The Borrower promises to pay to the Administrative
Agent for the account of the Banks the principal amount of the Term Loan A
in twenty (20) consecutive quarterly installments, payable on the last
Business Day of each calendar year quarter ending within any period set
forth below in the amount set forth opposite such period, commencing on
September 30, 1997 with a final payment on the Term Loan A Maturity Date
in an amount equal to the unpaid balance of the Term Loan A.
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Percentage of
Amount of Total Original Principal
Period Annual/Quarter Installment Amount of Term Loan A
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07/01/97 - 06/30/98 $600,000($150,000/qtr.) 5%
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07/01/98 - 12/31/98 $600,000($300,000/qtr.) 5%
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01/01/99 - 12/31/99 $2,400,000($600,000/qtr.) 20%
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01/01/00 - 12/31/00 $3,000,000($750,000/qtr.) 25%
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01/01/01 - 12/31/01 $3,000,000($750,000/qtr.) 25%
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01/01/02 - 03/31/02 $1,800,000($1,800,000/qtr.) 15%
04/01/02 - 05/31/02 $600,000 5%
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(d) Section 4.4.2 of the Credit Agreement is amended by (i) deleting the
number "sixteen (16)" and substituting the number "thirteen (13)" therefor
and (ii) deleting the date "September 30, 1998" and substituting the date
"June 30, 1999" therefor.
(e) Section 4.5 of the Credit Agreement is amended by deleting the date
"June 30, 1997" and substituting the date "December 31, 1998" therefor.
(f) Section 10.2 of the Credit Agreement is amended by (i) deleting the
word "and" at the end of clause (h), (ii) deleting the period at the end
of clause (i) and substituting a semicolon and the word "and" therefor and
(iii) adding the following new clause (j):
(j) during the "Term" pursuant to and as defined in the Stock Escrow
Agreement, dated as of July 11, 1997, among Anicom, Inc. ("Anicom"),
Reel Acquisition Corp. ("Acquisition Corp.") and Xxxxxx Trust and
Savings Bank, as Escrow Agent thereunder, liens in favor of Anicom
on the common stock of Anicom issued to and owned by the Borrower.
(g) Sections 11.1 through 11.5 and Section 11.7 of the Credit Agreement
are amended as follows: -
(i) Section 11.1 is amended by deleting such Section 11.1 and
restating it in its entirety as follows:
11.1. CONSOLIDATED NET WORTH. The Borrower will not permit
Consolidated Net Worth commencing with the fiscal quarter ended
September 30, 1997 to be less than $5,000,000, plus 75% of
Consolidated Net Income on a cumulative basis as at each fiscal
quarter end as set forth in the Compliance Certificate delivered
pursuant to Section 9.4(c).
(ii) Section 11.2 is amended by deleting such Section 11.2 and
restating it in its entirety as follows:
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11.2. SENIOR FUNDED DEBT TO EBITDA. The Borrower will not, as at the
end of any Reference Period ending during any period described in
the table set forth below, permit the ratio of Senior Funded Debt to
Consolidated EBITDA to exceed the ratio set forth opposite such
period in such table:
Period Ratio
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09/30/97-12/31/98 4.00:1.00
01/01/99-12/31/99 3.25:1.00
Thereafter 2.50:1.00
(iii) Section 11.3 is amended by deleting such Section 11.3 and
restating it in its entirety as follows:
11.3. TOTAL FUNDED DEBT TO EBITDA. The Borrower will not, as at the
end of any Reference Period ending during any period described in
the table set forth below, permit the ratio of Total Funded Debt to
Consolidated EBITDA to exceed the ratio set forth opposite such
period in such table:
Period Ratio
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09/30/97-12/31/98 5.25:1.00
01/01/99-12/31/99 4.25:1.00
Thereafter 3.50:1.00
(iv) Section 11.4 is amended by deleting the ratio "2.50:1.00" and
substituting the ratio "2.00:1.00" therefor.
(v) Section 11.5 is amended by deleting such Section 11.5 and
restating it in its entirety as follows:
11.5. FIXED CHARGE COVERAGE RATIO. The Borrower will not, as at the
end of any Reference Period ending on September 30, 1997 and
thereafter, permit the ratio of (i) the sum of (A) Consolidated
EBITDA, plus (B) Rental Obligations with respect to all operating
leases for equipment of the Borrower and its Subsidiaries made
during such period, minus (C) Non-Discretionary Capital Expenditures
made during such period to (ii) the sum of (A) Consolidated Total
Expense for such period, plus (B) all mandatory scheduled payments
of Term Loan A and Term Loan B, plus (C) Rental Obligations with
respect to all operating leases of the Borrower and its Subsidiaries
made during such period, plus all cash taxes and dividends paid
during such period, to be less than 1.3:1.00.
For the purposes of this Section 11.5, Consolidated EBITDA shall be
calculated by (i) annualizing Consolidated EBITDA determined at the
end of the nine month period ending September 30, 1997, (ii)
including the gain realized with respect to the inventory of the
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EEC division of the Borrower from the sale of such division to
Acquisition Corp. and (iii) excluding from such calculation any
other extraordinary non-recurring items of gain with respect to such
sale. For each Reference Period thereafter, the gain described in
clause (ii) above shall be included in the calculation of
Consolidated EBITDA.
(vi) Section 11.7 is amended by deleting such Section 11.7 in its
entirety.
(g) Schedule 1 to the Credit Agreement is amended by deleting such
Schedule and substituting Schedule 1 attached hereto therefor.
SECTION 3. AMENDMENT FEE. The Borrower shall pay to the Co-Agents on the
effective date of this Amendment an amendment fee in the amount of $25,000
for the pro rata accounts of the Co-Agents.
SECTION 4. CONDITIONS TO EFFECTIVENESS. The effectiveness of this
Amendment shall be subject to receipt by the Administrative Agent of the
following:
(a) This Amendment executed by each of the Borrower, the Banks and
the Co-Agents.
(b) An executed Assignment and Acceptance between each of BKB and
Fleet Bank, N.A. and NBD and Fleet Bank, N.A., substantially in the form
of Exhibit H to the Credit Agreement and evidence of consummation of the
transactions contemplated by each such Assignment and Acceptance.
(c) Amended and restated Notes reflecting the appropriate amounts
after giving effect to each Assignment and Acceptance described in clause
(b) above and this Amendment.
(d) Repayment by the Borrower to the Banks of any amounts required
to be paid pursuant to the terms of the Credit Agreement after giving
effect to this Amendment.
(e) The Borrower Stock Pledge Agreement executed by the Borrower in
form and substance satisfactory to the Banks, evidence of delivery of the
stock certificates to the Escrow Agent under and as defined in the Stock
Escrow Agreement, dated as of July 11, 1997, among Anicom, Acquisition
Corp., the Borrower and Xxxxxx Trust and Savings Bank, as Escrow Agent
(the "Escrow Anent"), and stock powers executed in blank by the Borrower.
(f) The Registration Rights Agreement, dated as of July 11, 1997 and
executed by each of Anicom and the Borrower, a copy of the Escrow
Agreement and a copy of the Asset Purchase Agreement, dated July 11, 1997
among Anicom, Acquisition Corp., and the Borrower, each in form and
substance satisfactory to the Banks (collectively, the "Sale Documents").
(g) Corporate resolutions of the Borrower with respect to the
transactions contemplated by this Amendment and the Sale Documents.
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(h) The opinion of counsel to the Borrower with respect to this
Amendment and the other documents evidencing the rights of the Banks
and/or the obligations of the Borrower to the Banks upon giving effect to
the sale of the EEC division of the Borrower contemplated by 10.5.2 of the
Credit Agreement.
(i) The amendment fee pursuant to Section 3 of this Amendment.
SECTION 5. AFFIRMATION AND ACKNOWLEDGMENT OF THE BORROWER. The Borrower
hereby ratifies and confirms all of its Obligations to the Banks and the
Co-Agents, including, without limitation the Loans, and the Borrower hereby
affirms its absolute and unconditional promise to pay to the Banks the Loans and
all other amounts due under the Credit Agreement as amended hereby.
SECTION 6. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents
and warrants to the Co-Agents and the Banks as follows:
(a) Representation and Warranties in the Credit Agreement. The
representations and warranties of the Borrower contained in the Credit
Agreement were true and correct in all material respects as of the date
when made and continue to be true and correct in all material respects on
the date hereof, except to the extent of changes resulting from
transactions or events contemplated by the Credit Agreement and the other
Loan Documents and changes occurring in the ordinary course of business
that singly or in the aggregate are not materially adverse to the
Borrower, or to the extent that such representations and warranties relate
expressly to an earlier date.
(b) Authority, Etc. The execution and delivery by the Borrower of
this Amendment and the performance by the Borrower of all of its
agreements and obligations under the Credit Agreement as amended hereby
are within the corporate authority of the Borrower and have been duly
authorized by all necessary corporate action on the part of the Borrower.
(c) Enforceability of Obligations. This Amendment and the Credit
Agreement as amended hereby constitute the legal, valid and binding
obligations of the Borrower, enforceable against the Borrower in
accordance with their terms, except as enforceability is limited by
bankruptcy, insolvency, reorganization, moratorium or other laws relating
to or affecting generally the enforcement of, creditors' rights and except
to the extent that availability of the remedy of specific performance or
injunctive relief is subject to the discretion of the court before which
any proceeding therefor may be brought.
(d) No Default. No Default or Event of Default has occurred and is
continuing, and no Default or Event of Default will exist after execution
and delivery of this Amendment.
SECTION 7. NO OTHER AMENDMENTS OR WAIVERS. Except as expressly provided in
this Amendment, all of the terms and conditions of the Credit Agreement and the
other Loan Documents remain in full force and effect.
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SECTION 8. EXPENSES. Pursuant to Section 17 of the Credit Agreement, all
costs and expenses incurred or sustained by the Co-Agents in connection with
this Amendment, including the fees and disbursements of legal counsel for the
Co-Agents in producing, reproducing and negotiating the Amendment, will be for
the account of the Borrower whether or not the transactions contemplated by this
Amendment are consummated.
SECTION 9. EXECUTION IN COUNTERPARTS. This Amendment may be executed in
any number of counterparts, each of which shall be deemed an original, but which
together shall constitute one instrument.
SECTION 10. MISCELLANEOUS. THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT
UNDER THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE COMMONWEALTH OF
MASSACHUSETTS (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). The
captions in this Amendment are for convenience of reference only and shall not
define or limit the provisions hereof.
[REMAINDER OF PAGE IS LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as a
document under seal as of the date first above written.
CONNECTIVITY PRODUCTS INCORPORATED
By:/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, Senior Vice President
NBD BANK, individually and as
Administrative Agent
By: /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx, Vice President
BANKBOSTON, N.A.
F/K/A THE FIRST NATIONAL BANK
OF BOSTON, individually
and as Documentation Agent
By: /s/ G. Xxxxxxxxxxx Xxxxxx
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G. Xxxxxxxxxxx Xxxxxx, Vice President
