FIRST AMENDMENT
AMENDMENT dated as of November 25, 1996 (this
"Amendment") to the Amended and Restated Credit Agreement dated
as of February 17, 1995 (as in effect immediately prior to the
date hereof, the "Credit Agreement") among D 56, INC., a
Minnesota corporation (the "Company"), the several banks and
other financial institutions party thereto (the "Banks") and The
CHASE MANHATTAN BANK (as successor to Chemical Bank), a New York
banking corporation, as agent for the Banks (in such capacity,
the "Agent").
W I T N E S S E T H :
WHEREAS, the Company, the Banks, the Co-Agents named
therein and the Agent are parties to the Credit Agreement;
WHEREAS, the Company has requested that the Agent and
the Banks amend the Credit Agreement in certain respects; and
WHEREAS, the Agent and the Banks are willing to enter
into this Amendment on the terms and conditions hereof;
NOW, THEREFORE, in consideration of the premises and
the mutual covenants herein contained, the parties hereto agree
as follows:
1. Defined Terms. Unless otherwise defined herein,
capitalized terms used herein which are defined in the Credit
Agreement are used herein as so defined.
2. Amendment to Subsection 1.1. The definition of
"Excess Cash Flow" set forth in subsection 1.1 is amended by
deleting therefrom the following phrase that appears at the end
thereof: "subsection 8.11(a), 8.11(c) or 8.11 (d)" and
substituting in lieu thereof, the phrase "subsection 8.11(a) or
8.11(c)".
3. Amendment to Subsection 8.8. Subsection 8.8 is
amended by deleting said subsection in its entirety and
substituting, in lieu thereof, the following new subsection 8.8:
8.8 Consolidated Net Worth. Permit Consolidated Net
Worth as at the last day of any fiscal quarter to be less
than the sum of (i) $140,000,000 plus (ii) 50% of
Consolidated Net Income for each fiscal quarter (if
Consolidated Net Income for such fiscal quarter is positive)
ending on or prior to such day, commencing with the fiscal
quarter ending April 5, 1997.
4. Amendment to Subsection 8.11. Subsection 8.11 of
the Credit Agreement is hereby amended by deleting clause (d) in
its entirety and substituting therefor the following new clause (d):
(d) so long as no Default or Event of Default has
occurred or would occur after giving effect to such
declaration or payment, the Company may, from time to time,
pay cash dividends to EBI and Intermediate Co., EBI may
declare and pay cash dividends to Intermediate Co. and
Intermediate Co. may declare and pay cash dividends to
Holding in an aggregate amount not to exceed the sum of (i)
$40,000,000 plus (ii) in any fiscal year ending on or after
January 2, 1999, an amount equal to the lesser of (A) 50%
(or, from and after the date of payment in full of the Term
Loans, 100%) of Excess Cash Flow for the immediately
preceding fiscal year and (B) 50% (or, from and after the
date of payment in full of the Term Loans, 75%) of
Consolidated Net Income for such immediately preceding
fiscal year; provided that, in each case, (x) the amount of
dividend availability determined for any fiscal year
pursuant to clause (ii) above that is not paid as dividends
thereunder during such fiscal year may be carried forward
and added to such availability in any subsequent fiscal
year, (y) no such dividend may be paid if the proceeds
thereof are used or are intended to be used to pay principal
of Indebtedness of Holding unless at the time of such
declaration or payment the aggregate outstanding amount of
the Revolving Credit Loans and Acceptance Obligations, other
than Revolving Credit Loans used solely to support foreign
currency xxxxxx, is zero and (z) the Agent shall have
received, with a counterpart for each Bank, a certificate of
the chief financial officer of the Company setting forth a
calculation of the estimated Consolidated Net Income and
Excess Cash Flow for the immediately preceding fiscal year
of the Company and, if such dividend is paid in reliance on
Consolidated Net Income and Excess Cash Flow periods not
covered by audited financial statements of the Company
previously delivered to the Banks, stating that such
calculation constitutes a good faith reasonable estimate of
Consolidated Net Income and Excess Cash Flow for the period
not covered by such financial statements based on all facts
and circumstances then known.
5. Representations and Warranties. The Company hereby
confirms that, after giving effect to the amendments provided for
herein, the representations and warranties contained in Section 5
of the Credit Agreement are true and correct in all material
respects on and as of the date hereof and no Default or Event of
Default has occurred and is continuing.
6. No Other Amendments. Except as expressly amended
hereby, the Credit Agreement shall continue to be, and shall
remain, in full force and effect in accordance with its terms.
7. Counterparts. This Amendment may be executed by
the parties hereto in any number of separate counterparts and all
of such counterparts taken together shall be deemed to constitute
one and the same instrument.
8. Conditions to Effectiveness. This Amendment shall
become effective as of the date first written above when each of
the following conditions to effectiveness shall have been
satisfied:
(i) the Agent shall have received counterparts to this
Amendment, duly executed by the Company, the Required Banks
and the Agent; and
(ii) the Agent shall have received the Acknowledgement
and Consent, attached to each counterpart hereof, duly
executed by each of the Credit Parties (other than the
Company).
9. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED
BY, AND SHALL BE CONSTRUED AND INTERPRETED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their proper and
duly authorized officers as of the date set forth above.
D 56, INC.
By: /s/ XXXXXXX XXXXXXX
Title: Vice President - Finance
THE CHASE MANHATTAN BANK, as Agent
and as a Bank
By: /s/ XXXXXXX XXXXXX
Title: Credit Executive
BANK OF AMERICA ILLINOIS
By: /s/ XXXXXXXX X. XXXXXXXX
Title: Vice President
FIRST BANK NATIONAL ASSOCIATION
By: /s/ XXXXXX X. XXXXXXX
Title: Vice President
XXXXXX TRUST AND SAVINGS BANK
By: /s/ XXXX X. XXXXXX
Title: Vice President
BANK OF NOVA SCOTIA
By: /s/ F.C.H. XXXXX
Title: Senior Manager Loan Operations
SUMITOMO BANK, LIMITED
By: /s/ XXXX X. XXXXXXXX
Title: Vice President
By: /s/ XXXXXXX X. PHILIPPE
Title: Vice President
DEUTSCHE BANK A.G. CHICAGO AND/OR
CAYMAN ISLAND BRANCHES
By: /s/ XXXX XXXXXXXX
Title: Associate
By: /s/ XXXX XXXXXXXX
Title: Vice President
NATIONAL BANK OF DETROIT
By: /s/ XXXXXXXXXX XXXXXXX
Title: Vice President
SOCIETE GENERALE
By: /s/ XXXXX XXXXXX
Title: Assistant Vice President
ABN-AMRO BANK N.V.
By: /s/ XXXXXXXXX XXXXXX
Title: Vice President
By: /s/ XXXXXX X. XXXXXX
Title: Vice President
THE LONG-TERM CREDIT BANK OF JAPAN,
LIMITED
By: /s/
Title: Deputy General Manager
ACKNOWLEDGEMENT AND CONSENT
Each of the undersigned Credit Parties (as defined in
the Amended and Restated Credit Agreement dated as of February
17, 1995; as amended, supplemented and otherwise modified prior
to the execution and delivery of the Amendment, the "Credit
Agreement") among D 56, INC., a Minnesota corporation (the
"Company"), the banks and other financial institutions parties
thereto (collectively, the "Banks") and THE CHASE MANHATTAN BANK
(as successor to Chemical Bank), a New York banking corporation,
as agent for the Banks (in such capacity, the "Agent") hereby
acknowledges, and consents to, the execution and delivery of the
First Amendment dated as of November 25, 1996 to the Credit
Agreement, and agrees to remain bound by each Credit Document to
which it is a party.
DEPARTMENT 56, INC.
By: /s/ XXXXXXX X. XXXXXXX
Title: Vice President
FL 56 INTERMEDIATE CORP.
By: /s/ XXXXXXX X. XXXXXXX
Title: Vice President
xx xxxxxxx international, inc.
By: /s/ XXXXXXX X. XXXXXXX
Title: Vice President
DEPARTMENT 56 TRADING CO., LTD.
By: /s/ XXXXXXX X. XXXXXXX
Title: Vice President
