EXHIBIT 10.1
FIRST AMENDMENT
TO STANDSTILL AGREEMENT
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This First Amendment to Standstill Agreement ("First Amendment") is
effective as of the 14th day of December 2001, and is executed by and among (a)
Metatec International, Inc. (the "Company"), an Ohio corporation, as borrower,
(b) The Huntington National Bank ("Huntington"), a national banking association,
Bank One, NA ("Bank One") and all other financial institutions from time to time
hereafter party to the Amended and Restated Loan Agreement dated as of March 31,
2001 (as amended by the Standstill Agreement (as defined below) and as amended
from time to time, the "Loan Agreement") as lenders (Huntington, Bank One and
such financial institutions, collectively the "Banks" and individually a
"Bank"); and Huntington in its capacity as Administrative Agent for the Banks
pursuant to the Loan Agreement (the "Administrative Agent"). All capitalized
terms not otherwise defined herein shall have the meanings ascribed to such
terms in the Loan Agreement.
RECITALS
A. The Company, the Banks and the Administrative Agent as of November
20, 2001, entered into a certain Standstill Agreement and First Amendment to
Amended and Restated Loan Agreement (the "Standstill Agreement").
B. The Company, the Banks and the Administrative Agent have agreed to
modify and amend certain provisions of the Standstill Agreement, as set forth
below.
STATEMENT OF AGREEMENT
In consideration of the foregoing, and the agreements contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Company, the Banks and the Administrative
Agent agree as follows:
1. The above Recitals are incorporated by this reference into the
agreement of the parties.
2. The Standstill Agreement is amended as follows:
(a) Section 3 ACKNOWLEDGMENT OF OBLIGATIONS is replaced as of
December 14, 2001, with the following: "Section 3.
ACKNOWLEDGMENT OF OBLIGATIONS. As of December 14, 2001: (a)(i)
the outstanding principal balance of the Huntington Revolving
Note is $4,963,522.32, (ii) the outstanding principal balance
of the Bank One Revolving Note is $3,309,014.88, (iii) the
outstanding principal balance of the Huntington Term Note is
$5,595,750.00, (iv) the outstanding principal balance of the
Bank One Term Note is $3,730,500.00, and (v) the aggregate
stated value of issued and outstanding Sub-Facility Letters of
Credit is $2,050,000.00; (b) in
addition to the foregoing principal sums of the
Notes, the Company is indebted to the Banks with
respect to the Notes and the Loan Agreement for
accrued and unpaid interest, accrued and unpaid
Commitment Fees, late charges, and other fees and
assessments; and (c) all such amounts are payable in
full as provided in the Loan Agreement and the Loan
Documents, without offset, recoupment, deduction or
counterclaim of any kind or character whatsoever, but
are subject to increase or other adjustment as a
result of any and all advances, interest charges,
late charges and other assessments, including,
without limitation, attorneys' fees and costs of
collection, which are payable to the Administrative
Agent and the Banks under the Loan Agreement and the
Loan Documents."
(b) Section 7 STANDSTILL PERIOD is amended (i) to delete
"December 14, 2001" in the first sentence and to
replace it with "February 8, 2002;" and (ii) to
delete the existing the second paragraph and replace
it with the following: "As used herein, a "Standstill
Termination Event" shall exist if any of the
following (excluding the Current Defaults) occurs:
(a) the Company fails to make any payment with
respect to any Obligation by the date such payment is
due (other than $625,000.00 principal payments due on
November 30, 2001, December 31, 2001, and January 31,
2002 with respect to the Term Note and certain
$75,000.00 fee payments due November 30, 2001, to
each of Huntington and Bank One under the Section
2.14 of the Loan Agreement, all of which payments are
hereby deferred to the end of the Standstill Period);
or (b) any other Event of Default occurs (and a
breach of any term of this Agreement shall constitute
an additional Event of Default under the Loan
Agreement)."
(c) Section 8 AMENDMENT OF LOAN AGREEMENT is amended to
delete "December 14, 2001" in the first paragraph of
Section 8(c) [Section 1.3(j)(i) of the Loan
Agreement] and to replace it with "February 8, 2002.
(d) Section 8 AMENDMENT OF LOAN AGREEMENT is amended to
delete the sixth paragraph of Section 8(c) [Section
1.3(j)(vi) of the Loan Agreement] and replace it with
the following: "(vi) Termination. The unpaid
principal balance of the Draw Loan, together with all
accrued and unpaid interest and all fees, charges and
other outstanding obligations arising in connection
with the Draw Loan, shall be due and payable on
February 8, 2002, or at the date of acceleration of
the Draw Note."
(e) Section 8 AMENDMENT OF THE LOAN AGREEMENT is amended
to delete "November 30, 2001" in each of the two
instances in which it occurs in Section 8(d), and to
replace it in each instance with "November 30, 2001,
December 31, 2001 and January 31, 2002."
(f) Section 8 AMENDMENT OF THE LOAN AGREEMENT is amended
to insert at the end of subparagraph (ii) of (j)
OVER-ADVANCE DRAW LOAN FACILITY the following: "Net
proceeds of the M&E Equipment" as used in the
preceding sentence and in Section 4.24(b) of the Loan
Agreement means the proceeds received by the Banks
less the amount up to $500,000.00 that the Company is
required to pay to the Landlord pursuant to the terms
of a lease termination agreement to which the Banks
have consented in form and in substance. For purposes
of determining the value of machinery and equipment
in computing the maximum principal amount of the
Over-Advance Draw Loan, the values contained in the
July 2001 appraisal will be used absent material
change in the value of such machinery and equipment."
(g) Section 8 AMENDMENT OF THE LOAN AGREEMENT is amended
to delete "November 30, 2001" in each of the two
instances in which it occurs in Section 8(e), and to
replace it in each instance with "November 30, 2001,
December 31, 2001 and January 31, 2002."
(h) Section 8 AMENDMENT OF THE LOAN AGREEMENT is amended
to delete "December 14, 2001" where it appears in the
first sentence of Section 8(h) and to replace it with
"February 8, 2002."
(i) The term "Current Defaults" as used in the Standstill
Agreement is amended to include the failure of the
Company to meet the requirements of Sections 4.12 and
4.21 of the Loan Agreement with respect to the
periods ending November 30, 2001.
(j) A new Section 26 is added to the Standstill
Agreement, as follows:
Section 26. ASSET SALES. Notwithstanding any
provision of the Loan Agreement or any of the Loan
Documents (including, without limitation, Section 4.3
of the Loan Agreement), the Company shall not,
without the prior written consent of the
Administrative Agent and the Required Banks, sell,
transfer or otherwise dispose of any personal
property assets unless the proceeds of such assets
are delivered to the Administrative Agent. Nothing
contained in this Section 26 shall be construed to
permit the Company to sell any assets. In the event
that the sale of personal property assets, and the
application of the proceeds thereof to the Revolving
Loan, results in an over-advance under the Revolving
Loan, the Over-Advance Draw Loan will be increased by
the amount of such over-advance, and the Draw Note
will be increased correspondingly in the amount of
the over-advance.
3. This First Amendment represents the entire understanding of the
parties with respect to the subject matter hereof. Except as expressly set forth
in this First Amendment, the
Standstill Agreement, and the Obligations of the Company to the Administrative
Agent and the Banks under the Standstill Agreement, the Loan Agreement and the
other Loan Documents shall remain as currently written and in full force and
effect in all respects, and nothing contained herein shall affect, alter,
modify, limit or impair any of the rights and powers that the Administrative
Agent and the Banks may have thereunder. Each of the representations,
warranties, acknowledgments and waivers made by the Company in the Standstill
Agreement as originally written remain in full force and effect. Without
limiting the generality of the foregoing, the Company makes the same
representations and warranties with respect to this First Amendment that it made
with respect to the Standstill Agreement and the Loan Documents in Section 14 of
the Standstill Agreement.
4. This First Amendment may be executed in any number of counterparts,
with the same effect as if the signatures were on the same instrument. This
First Amendment shall be interpreted, and the rights and obligations of the
parties determined, in accordance with the internal laws of the state of Ohio.
IN WITNESS WHEREOF, the parties hereto, by their officers duly
authorized, have executed and delivered this First Amendment on December 31,
2001, effective as of December 14, 2001.
COMPANY:
METATEC INTERNATIONAL, INC., an Ohio
corporation
By: /s/ Xxxxxxxxxxx X. Xxxxx
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Its: President and CEO
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ADMINISTRATIVE AGENT:
THE HUNTINGTON NATIONAL BANK, a national
banking association, as Administrative Agent
By: /s/ Xxxxx X. Xxxxx
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Its: Senior Vice President
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BANK:
THE HUNTINGTON NATIONAL BANK, a national
banking association
By: /s/ Xxxxx X. Xxxxx
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Its: Senior Vice President
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BANK:
BANK ONE, NA, a national banking association
By: /s/ Xxxxxxx X. Xxxxxx
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Its: Vice President
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