LA1:952680.7
WINSLOEW FURNITURE, INC.
FIRST AMENDMENT
TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is dated as of
December 14, 2001 and entered into by and among WinsLoew Furniture, Inc., a
Florida corporation ("Borrower"), the financial institutions listed on the
signature pages hereof ("Lenders") and Canadian Imperial Bank of Commerce, as
Administrative Agent for Lenders (Administrative Agent"), and, for purposes of
Section 4 hereof, the Credit Support Parties (as defined in Section 4 hereof)
listed on the signature pages hereof, and is made with reference to that certain
Credit Agreement dated as of May 8, 2001, (the "Credit Agreement"), by and among
Borrower, Lenders, CIBC Inc., as swing line lender, Agent and CIBC World Markets
Corp., as lead arranger and bookrunner. Capitalized terms used herein without
definition shall have the same meanings herein as set forth in the Credit
Agreement.
RECITALS
WHEREAS, Borrower and Lenders desire to amend the Credit Agreement (i) to adjust
the financial covenants set forth herein, (ii) to adjust the pricing terms as
set forth herein, (iii) to adjust the reporting requirements as set forth
herein, and (iv) to make certain other amendments as set forth below;
NOW, THEREFORE, in consideration of the premises and the agreements, provisions
and covenants herein contained, the parties hereto agree as follows:
Section 1. AMENDMENTS AND WAIVERS TO THE CREDIT AGREEMENT
1.1 Amendments to Section 1: Provisions Relating to Defined Terms
A. The definition of "Adjusted LIBOR" in subsection 1.1 of the Credit Agreement
is hereby amended by adding after the phrase "(x) the rate of interest equal to"
the phrase "the greater of 2.50% and".
B. The definition of Applicable LIBOR Margin is hereby deleted in its entirety
and the following is substituted in lieu thereof:
" `Applicable LIBOR Margin' means with respect to Term Loans and Revolving Loans
that are LIBOR Loans, a percentage per annum as set forth below opposite the
applicable Consolidated Total Leverage Ratio:
---------------------------------- -------------------------------- --------------------------------
Consolidated Total Leverage Ratio Applicable LIBOR Margin for Applicable LIBOR Margin for
Revolving Loans Term Loans
---------------------------------- -------------------------------- --------------------------------
---------------------------------- -------------------------------- --------------------------------
greater than or equal to 4.00% 4.50%
5.25:1.00
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less than 5.25:1.00 3.75% 4.25%
but greater than or equal to
4.75:1.00
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---------------------------------- -------------------------------- --------------------------------
less than 4.75:1.00 3.50% 4.00%
but greater than or equal to
4.25:1.00
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---------------------------------- -------------------------------- --------------------------------
less than 4.25:1.00 3.25% 4.00%
but greater than or equal to
3.75:1.00
---------------------------------- -------------------------------- --------------------------------
---------------------------------- -------------------------------- --------------------------------
less than 3.75:1.00 3.00% 4.00%
but greater than or equal to
3.25:1.00
---------------------------------- -------------------------------- --------------------------------
---------------------------------- -------------------------------- --------------------------------
less than 3.25:1.00 2.75% 4.00%
but greater than or equal to
2.75:1.00;
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less than 2.75:1.00 2.50% 4.00%
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; provided that from September 30, 2001until the date that is five Business Days
after the date on which Borrower delivers the Margin Determination Certificate
required to be delivered to Administrative Agent pursuant to subsection 6.1(xvi)
for the Fiscal Year ended December 31, 2001, the Applicable LIBOR Margin for
Revolving Loans that are LIBOR Loans shall be 4.00% and the Applicable LIBOR
Margin for Term Loans that are LIBOR Loans shall be 4.50%."
C. The definition of Consolidated Net Worth is hereby amended by adding at the
end thereof the phrase ", other than for adjustments required pursuant to FASB
133 and FASB 142".
1.2 Amendments to Section 6: Borrower's Affirmative Covenants
A. Subsection 6.1(iv) of the Credit Agreement is hereby amended by adding after
the phrase "subdivisions (i), (ii) and (iii) above," the phrase "and in any
event (x) for the Fiscal Year ended December 31, 2001, on or prior to January
31, 2002, (y) for the Fiscal Quarter ended June 30, 2002, on or prior to July
31, 2002, and (z) for the Fiscal Year ended December 31, 2002, on or prior to
.January 31, 2003,".
1.3 Amendments to Section 7: Borrower's Negative Covenants
A. Investments; Joint Ventures. Subsection 7.3(i) of the Credit Agreement is
hereby amended by adding at the end thereof the following phrase: "provided,
however, that the aggregate amount of unrestricted Cash and Cash --------
------- Equivalents owned by Borrower and its Subsidiaries shall not at any time
exceed $6,000,000".
B. Maximum Consolidated Total Leverage Ratio. Subsection 7.6A of the
Credit Agreement is hereby amended (i) by deleting the Maximum Consolidated
Total Leverage Ratios set forth for the 4th Fiscal Quarter of Fiscal Year 2001,
the 1st Fiscal Quarter of Fiscal Year 2002, the 2nd Fiscal Quarter of Fiscal
Year 2002, the 3rd Fiscal Quarter of Fiscal Year 2002 and the 4th Fiscal Quarter
of Fiscal Year 2002, respectively, and substituting in each case in lieu thereof
the ratio "5.65:1.00", (ii) by deleting the Maximum Consolidated Total Leverage
Ratio set forth for the 1st Fiscal Quarter of Fiscal Year 2003, and substituting
in lieu thereof the ratio "5.25:1.00", and (iii) by deleting the Maximum
Consolidated Total Leverage Ratio set forth for the 2nd Fiscal Quarter of Fiscal
Year 2003, and substituting in lieu thereof the ratio "5.15:1.00".
C. Maximum Consolidated Senior Leverage Ratio. Subsection 7.6B of the
Credit Agreement is hereby amended (i) by deleting the Maximum Consolidated
Senior Leverage Ratios set forth for the 4th Fiscal Quarter of Fiscal Year 2001,
the 1st Fiscal Quarter of Fiscal Year 2002, the 2nd Fiscal Quarter of Fiscal
Year 2002, the 3rd Fiscal Quarter of Fiscal Year 2002 and the 4th Fiscal Quarter
of Fiscal Year 2002, respectively, and substituting in each case in lieu thereof
the ratio "3.65:1.00", (ii) by deleting the Maximum Consolidated Senior Leverage
Ratio set forth for the 1st Fiscal Quarter of Fiscal Year 2003 and substituting
in lieu thereof the ratio "3.25:1.00", and (iii) by deleting the Maximum
Consolidated Senior Leverage Ratio set forth for the 2nd Fiscal Quarter of
Fiscal Year 2003 and substituting in lieu thereof the ratio "3.15:1.00".
D. Minimum Interest Coverage Ratio. Subsection 7.6C of the Credit
Agreement is hereby amended (i) by deleting the Minimum Interest Coverage Ratios
set forth for the 4th Fiscal Quarter of Fiscal Year 2001, the 1st Fiscal Quarter
of Fiscal Year 2002, the 2nd Fiscal Quarter of Fiscal Year 2002, the 3rd Fiscal
Quarter of Fiscal Year 2002 and the 4th Fiscal Quarter of Fiscal Year 2002,
respectively, and substituting in each case in lieu thereof the ratio
"1.60:1.00", and (ii) by deleting the Minimum Interest Coverage Ratios set forth
for the 1st Fiscal Quarter of Fiscal Year 2003 and the 2nd Fiscal Quarter of
Fiscal Year 2003, respectively, and substituting in each case in lieu thereof
the ratio "1.80:1.00".
E. Minimum Fixed Charge Coverage Ratio. Subsection 7.6D of the Credit
Agreement is hereby amended by deleting the Minimum Fixed Charge Coverage Ratios
set forth for the 4th Fiscal Quarter of Fiscal Year 2001, the 1st Fiscal Quarter
of Fiscal Year 2002, the 2nd Fiscal Quarter of Fiscal Year 2002, the 3rd Fiscal
Quarter of Fiscal Year 2002, the 4th Fiscal Quarter of Fiscal Year 2002, the 1st
Fiscal Quarter of Fiscal Year 2003, and the 2nd Fiscal Quarter of Fiscal Year
2003, respectively, and substituting in each case in lieu thereof the ratio
"1.05:1.00".
1.4 Waivers
A. Permanent Waiver of Subsection 7.6A for the Third Fiscal Quarter 2001.
The Requisite Lenders hereby permanently waive compliance with subsection 7.6A
of the Credit Agreement for the Third Fiscal Quarter 2001.
Section 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Amendment shall become effective only upon the satisfaction of
all of the following conditions precedent (the date of satisfaction of such
conditions being referred to herein as the "Amendment Effective Date"):
A. On or before the Amendment Effective Date, Borrower shall deliver to Lenders
(or to Agent for Lenders with sufficient originally executed copies, where
appropriate, for each Lender and its counsel) the following, each, unless
otherwise noted, dated the Amendment Effective Date:
1. Resolutions of its Board of Directors (and the Board of Directors of
each Credit Support Party) approving and authorizing the execution,
delivery, and performance of this, certified as of the Amendment
Effective Date by its corporate secretary or an assistant secretary as
being in full force and effect without modification or amendment;
2. A certificate of its corporate secretary or an assistant secretary (and
the corporate secretary or assistant secretary of each Credit Support
Party) certifying that the organizational documents and signature and
incumbency certificates delivered to Administrative Agent on the
Closing Date remain in full force and effect without change; and
3. Executed copies of this Amendment.
B. Administrative Agent for the ratable benefit of each Lender that shall
have executed this Amendment on or prior to the Amendment Effective Date (the
"Consenting Lenders") shall have received an amendment fee equal to 0.25% of the
aggregate Commitments of the Consenting Lenders.
C. Administrative Agent shall have received payment from Borrower of all
costs, fees and expenses described in subsection 10.2 of this Credit Agreement
incurred by Administrative Agent and its counsel for periods prior to the
Amendment Effective Date and in connection with this Amendment.
D. On or before the Amendment Effective Date, all corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Administrative Agent, acting on behalf of Lenders, and its counsel
shall be satisfactory in form and substance to Administrative Agent and such
counsel, and Administrative Agent and such counsel shall have received all such
counterpart originals or certified copies of such documents as Agent may
reasonably request.
Section 3. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Amendment and to amend the Credit
Agreement in the manner provided herein, Borrower represents and warrants to
each Lender that the following statements are true, correct and complete:
A. Corporate Power and Authority. Borrower and each other Credit Support Party
has all requisite corporate power and authority to enter into this Amendment and
to carry out the transactions contemplated by, and perform its obligations
under, the Credit Agreement as amended by this Amendment (the "Amended
Agreement").
B. Authorization of Agreements. The execution and delivery of this Amendment,
and the performance of the Amended Agreement have been duly authorized by all
necessary corporate action on the part of Borrower and each other Credit Support
Party.
C. No Conflict. The execution and delivery by Borrower and each other
Credit Support Party of this Amendment and the performance by Borrower and each
other Credit Support Party of the Amended Agreement do not and will not (i)
violate any provision of any law or any governmental rule or regulation
applicable to Borrower or any of its Subsidiaries, the Certificate or Articles
of Incorporation or Bylaws of Borrower or any of its Subsidiaries or any order,
judgment or decree of any court or other agency of government binding on
Borrower or any of its Subsidiaries, (ii) conflict with, result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of Borrower or any of its Subsidiaries, (iii) result in
or require the creation or imposition of any Lien upon any of the properties or
assets of Borrower or any of its Subsidiaries, or (iv) require any approval of
stockholders or any approval or consent of any Person under any Contractual
Obligation of Borrower or any of its Subsidiaries.
D. Governmental Consents. The execution and delivery by Borrower and each
other Credit Support Party of this Amendment and the performance by Borrower and
each other Credit Support Party of the Amended Agreement do not and will not
require any registration with, consent or approval of, or notice to, or other
action to, with or by, any federal, state or other governmental authority or
regulatory body.
E. Binding Obligation. This Amendment and the Amended Agreement have been
duly executed and delivered by Borrower and each other Credit Support Party and
are the legally valid and binding obligations of Borrower and each other Credit
Support Party, enforceable against Borrower and each other Credit Support Party
in accordance with their respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles relating to
enforceability.
F. Incorporation of Representations and Warranties From Credit Agreement.
The representations and warranties contained in Section 4 of the Credit
Agreement are and will be true, correct and complete in all material respects on
and as of the Amendment Effective Date to the same extent as though made on and
as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case they were true, correct
and complete in all material respects on and as of such earlier date.
G. Absence of Default. No event has occurred and is continuing or will result
from the consummation of the transactions contemplated by this Amendment that
would constitute an Event of Default or a Potential Event of Default.
Section 4. ACKNOWLEDGEMENT AND CONSENT
Borrower is a party to certain Collateral Documents pursuant to which Borrower
has created Liens in favor of Administrative Agent on certain Collateral to
secure the Obligations. Holdings and each Subsidiary of Borrower is a party to
certain Guaranties and Collateral Documents pursuant to which such Person has
(i) guarantied the Obligations and (ii) created Liens in favor of Administrative
Agent on certain Collateral to secure the obligations of such Person under its
applicable Guaranty. Borrower, Holdings and each Subsidiary of Borrower are
collectively referred to herein as the "Credit Support Parties", and the
Guaranties and Collateral Documents referred to above are collectively referred
to herein as the "Credit Support Documents".
Each Credit Support Party hereby acknowledges that it has reviewed the terms and
provisions of the Credit Agreement and this Amendment and consents to the
amendment of the Credit Agreement effected pursuant to this Amendment. Each
Credit Support Party hereby confirms that each Credit Support Document to which
it is a party or otherwise bound and all Collateral encumbered thereby will
continue to guaranty or secure, as the case may be, to the fullest extent
possible the payment and performance of all "Obligations," "Guarantied
Obligations" and "Secured Obligations," as the case may be (in each case as such
terms are defined in the applicable Credit Support Document), including without
limitation the payment and performance of all such "Obligations," "Guarantied
Obligations" or "Secured Obligations," as the case may be, in respect of the
Obligations of Borrower now or hereafter existing under or in respect of the
Amended Agreement and the Notes defined therein.
Each Credit Support Party acknowledges and agrees that any of the Credit Support
Documents to which it is a party or otherwise bound shall continue in full force
and effect and that all of its obligations thereunder shall be valid and
enforceable and shall not be impaired or limited by the execution or
effectiveness of this Amendment. Each Credit Support Party represents and
warrants that all representations and warranties contained in the Amended
Agreement and the Credit Support Documents to which it is a party or otherwise
bound are true, correct and complete in all material respects on and as of the
Amendment Effective Date to the same extent as though made on and as of that
date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and complete in
all material respects on and as of such earlier date.
Each Credit Support Party (other than Borrower) acknowledges and agrees that (i)
notwithstanding the conditions to effectiveness set forth in this Amendment,
such Credit Support Party is not required by the terms of the Credit Agreement
or any other Loan Document to consent to the amendments to the Credit Agreement
effected pursuant to this Amendment and (ii) nothing in the Credit Agreement,
this Amendment or any other Loan Document shall be deemed to require the consent
of such Credit Support Party to any future amendments to the Credit Agreement.
Section 5. MISCELLANEOUS
A. Reference to and Effect on the Credit Agreement and the Other Loan Documents.
(i) On and after the Amendment Effective Date, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or words
of like import referring to the Credit Agreement, and each reference in the
other Loan Documents to the "Credit Agreement", "thereunder", "thereof" or words
of like import referring to the Credit Agreement shall mean and be a reference
to the Amended Agreement.
(ii) Except as specifically amended by this Amendment, the Credit Agreement
and the other Loan Documents shall remain in full force and effect and are
hereby ratified and confirmed.
(iii) The execution, delivery and performance of this Amendment shall not,
except as expressly provided herein, constitute a waiver of any provision of, or
operate as a waiver of any right, power or remedy of Administrative Agent or any
Lender under, the Credit Agreement or any of the other Loan Documents.
B. Fees and Expenses. Borrower acknowledges that all costs, fees and
expenses as described in subsection 10.2 of the Credit Agreement incurred by
Administrative Agent and its counsel with respect to this Amendment and the
documents and transactions contemplated hereby shall be for the account of
Borrower.
C. Headings. Section and subsection headings in this Amendment are included
herein for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose or be given any substantive effect.
D. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
E. Counterparts; Effectiveness. This Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed an original, but
all such counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document. This Amendment (other than the provisions of Section 1
hereof, the effectiveness of which is governed by Section 2 hereof) shall become
effective upon the execution of a counterpart hereof by Borrower, Requisite
Lenders and each of the Credit Support Parties and receipt by Borrower and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.
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S-2 11/25/01
LA1:952680.7
S-1 11/25/01
LA1:952680.7
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered by their respective officers thereunto duly authorized as
of the date first written above.
WINSLOEW FURNITURE, INC.
By:
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Title:
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WFI HOLDINGS, INC. (for purposes of Section 4 only)
as a Credit Support Party
By:
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Title:
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Each of the
entities listed on
Schedule A annexed
hereto (for
purposes of
Section 4 only) as
a Credit Support
Party
By:
----------------------------------------
On behalf of each
of the entities
listed on Schedule
A annexed hereto
Title:
CANADIAN IMPERIAL BANK OF COMMERCE, Individually
and as Administrative Agent
By:
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Title:
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________________, as a Lender
By:
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Title:
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