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EIGHTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
This Amendment ("Amendment") is made as of the lst day of December,
2000, by and between DMI FURNITURE, INC., a Delaware corporation (the "Company")
and BANK ONE, INDIANA, N.A. (the "Bank").
WHEREAS, the Company and the Bank entered into Amended and Restated
Credit Agreement dated October 3, 1997, as amended from time to time,
(collectively, the "Agreement"); and
WHEREAS, the parties hereto desire to amend the Agreement as set forth
below:
NOW, THEREFORE, the parties hereto agree as follows:
1. Capitalized terms not defined herein shall have the meaning ascribed
in the Agreement.
2. ACCOUNTING TERMS - DEFINITIONS.
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a. AMENDED DEFINITIONS. Each of the following definitions which
are set forth in Section 1.1 of the Agreement are hereby
amended and restated in their entireties, to read as follows:
"APPLICABLE DOCUMENTARY LETTER OF CREDIT COMMISSION RATE"
means the rate per annum at which the commission due upon the
issuance of each Documentary Letter of Credit will be
calculated, expressed as a percentage of the maximum amount
which may be drawn under the Documentary Letter of Credit,
which rate shall be determined by reference to the ratio of
Total Funded Debt to EBITDA in accordance with the following
table:
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Ratio of Total Applicable Documentary
Funded Debt Letter of Credit
to EBITDA Commission Rate
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3.50 to 4.00 3/4%
3.00 to and including 3.49 3/4%
2.50 to and including 2.99 3/4%
Less than 2.50 3/4%
The Applicable Documentary Letter of Credit
Commission Rate shall be determined on the date of
this Eight Amendment on the basis of the Ratio of
Total Funded Debt to EBITDA in effect on the date of
this Eighth Amendment (which the Company and the Bank
agree for purposes of the Applicable Documentary
Letter of Credit Commission Rate shall be between
3.50 to 4.00 as of the date of this Eighth Amendment)
and shall be redetermined and adjusted as of the
close of each fiscal quarter of the Company
thereafter, concurrently with any adjustment to the
Ratio of Total Funded Debt to EBITDA (as provided in
the definition of Ratio of Total Funded Debt to
EBITDA in this Agreement), with such redetermined
Applicable Documentary Letter of Credit Commission
Rate to be effective for the entire fiscal quarter of
the Company which immediately follows each such
fiscal quarter.
"APPLICABLE SPREAD I" means that number of percentage
points to be taken into account in determining the
rate per annum at which interest will accrue on the
Revolving Loan, which shall be determined by
reference to the Ratio of Total Funded Debt to EBITDA
in accordance with the following table:
If determining If determining
Ratio of Total a LIBOR-based a Prime-based
Funded Debt Rate on the Rate on the
to EBITDA Revolving Loan Revolving Loan
-------------- -------------- --------------
3.50 to 4.00 2 1/4% 0%
3.00 to and including 3.49 2 % 0%
2.50 to and including 2.99 1 3/4% 0%
Less than 2.50 1 1/2% 0%
Applicable Spread I shall be determined on the date
of this Eight Amendment on the basis of the Ratio of
Total Funded Debt to EBITDA in effect on the date of
this Eighth Amendment (which the Company and the Bank
agree for purposes of Applicable Spread I shall be
between 3.50 to 4.00 as of the date of this Eighth
Amendment) and shall be redetermined and adjusted as
of the close of each fiscal quarter of the Company
thereafter, concurrently with any adjustment to the
Ratio of Total Funded Debt to EBITDA (as provided in
the definition of Ratio of Total Funded Debt to
EBITDA in this Agreement), with such redetermined
Applicable Spread I to be effective for the entire
fiscal quarter of the Company which immediately
follows each such fiscal quarter.
"APPLICABLE SPREAD II" means that number of
percentage points to be taken into account in
determining the rate per annum at which interest will
accrue on the Term Loan, which shall be determined by
reference to the Ratio of Total Funded Debt to EBITDA
in accordance with the following table:
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If determining If determining
Ratio of Total a LIBOR-based a Prime-based
Funded Debt Rate on the Rate on the
to EBITDA Revolving Loan Revolving Loan
-------------- -------------- --------------
3.50 to 4.00 2 1/4% 0%
3.00 to and including 3.49 2 % 0%
2.50 to and including 2.99 1 3/4% 0%
Less than 2.50 1 1/2% 0%
Applicable Spread II shall be determined on the date
of this Eight Amendment on the basis of the Ratio of
Total Funded Debt to EBITDA in effect on the date of
this Eighth Amendment (which the Company and the Bank
agree for purposes of Applicable Spread II shall be
between 3.50 to 4.00 as of the date of this Eighth
Amendment) and shall be redetermined and adjusted as
of the close of each fiscal quarter of the Company
thereafter, concurrently with any adjustment to the
Ratio of Total Funded Debt to EBITDA (as provided in
the definition of Ratio of Total Funded Debt to
EBITDA in this Agreement), with such redetermined
Applicable Spread I to be effective for the entire
fiscal quarter of the Company which immediately
follows each such fiscal quarter.
"APPLICABLE UNUSED COMMITMENT FEE PERCENTAGE" means
the percentage determined by reference to the Ratio
of Total Funded Debt to EBITDA in accordance with the
following table:
Ratio of Total Applicable
Funded Debt Unused Commitment
to EBITDA Percentage Fee
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3.50 to 4.00 3/8%
3.00 to and including 3.49 3/8%
2.50 to and including 2.99 1/4%
Less than 2.50 1/4%
The Applicable Unused Commitment Fee Percentage shall
be determined on the date of this Eight Amendment on
the basis of the Ratio of Total Funded Debt to EBITDA
in effect on the date of this Eighth Amendment (which
the Company and the Bank agree for purposes of the
Applicable Unused Commitment Fee Percentage shall be
between 3.50 to 4.00 as of the date of this Eighth
Amendment) and shall be redetermined and adjusted as
of the close of each fiscal quarter of the Company
thereafter, concurrently with any adjustment to the
Ratio of Total Funded Debt to EBITDA (as provided in
the definition of Ratio of Total Funded Debt to
EBITDA in this Agreement), with such redetermined the
Applicable Unused Commitment Fee Percentage to be
effective for the entire fiscal quarter of the
Company which immediately follows each such fiscal
quarter.
"CHANGE IN MANAGEMENT" means either (i) Xxxxxx X.
Xxxxxx or (ii) Xxxxxx X. Xxxx is no longer a senior
executive of the Company.
"MAXIMUM AVAILABILITY" means: (i) from and after the Eighth Amendment
Agreement Date to and including July 31, 2001,
$24,000,000; (ii) from and after
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August 1, 2001 until the Scheduled Revolving Loan
Maturity Date, $26,500,000.
"OBLIGATIONS" means all present and future
indebtedness, obligations and liabilities, and all
renewals and extensions thereof, now or hereafter
owed of the Company to the Bank or to BANC ONE
CORPORATION, or to any of their respective
subsidiaries, affiliates or successors arising under,
by virtue of or pursuant to any of this Agreement,
the Notes, the Reimbursement Agreements, any other
Loan Documents, or otherwise, or in connection with
any one or more Rate Management Transactions,
together with all costs, expenses and reasonable
attorneys' fees (including the reasonable allocated
costs of staff counsel) incurred by the Bank in the
enforcement or collection thereof, whether such
indebtedness, obligations and liabilities are direct,
indirect, fixed, contingent, liquidated,
unliquidated, joint, several, joint and several, now
exist or hereafter arise, or were prior to
acquisition thereof by the Bank owed to some other
Person.
"SCHEDULED REVOLVING LOAN MATURITY DATE" means
December 31, 2001, or such subsequent date to which
the Revolving Loan Commitment may be extended by the
Bank pursuant to the terms of Section 2.02(d) of this
Agreement.
b. NEW DEFINITIONS. The following new definitions are
added to Section 1.01 of the Agreement, to read as
follows:
"RATE MANAGEMENT TRANSACTION" means any transaction
(including an agreement with respect thereto) now
existing or hereafter entered into between Company
and Bank or BANC ONE CORPORATION, or any of its
subsidiaries or affiliates or their respective
successors, which is a rate swap, basis swap, forward
rate transaction, commodity swap, commodity option,
equity or equity index swap, equity or equity index
option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor
transaction, collar transaction, forward transaction,
currency swap transaction, cross-currency rate swap
transaction, currency option or any other similar
transaction (including any option with respect to any
of these transactions) or any combination thereof,
whether linked to one or more interest rates, foreign
currencies, commodity prices, equity prices or other
financial measures.
"EIGHTH AMENDMENT" means the Eighth Amendment to
Amended and Restated Credit Agreement, dated as of
the 1st day of December, 2000, executed by the
Company and the Bank.
3. AFFIRMATIVE COVENANTS OF THE COMPANY.
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a. Sections 6.0l(g)(1), and (3) of the Agreement,
bearing the headings Tangible Net Worth and Ratio of
Total funded Debt to EBITDA, respectively, are
amended and restated in their entireties, to read as
follows:
(1) TANGIBLE NET WORTH. The Company shall at all
times from and after this Amendment maintain
its Tangible Net Worth at a level not less
than (i) 13,069,000, plus (ii) Fifty Percent
(50%) of the cumulative Net Income of the
Company for each fiscal year of the Company
ending after the Eighth Amendment Agreement
Date,
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provided, that such amount for each fiscal
year shall in no event be less than zero.
(3) RATIO OF TOTAL FUNDED DEBT TO EBITDA. As of
the close of each fiscal quarter of the
Company ending after the Eighth Amendment
Agreement Date, the Company, for the period
of the four consecutive fiscal quarters
shall have a Ratio of Total funded Debt to
EBITDA of not greater than (i) 4.00 to 1.00
at the close of each fiscal quarter ending
at any time from the Eighth Amendment
Agreement Date to but not including Xxxxx 0,
0000, (xx) 3.50 to 1.00 at the close of each
fiscal quarter ending at any time from March
3, 2001 to but not including June 2, 2001;
and (iii) 3.25 to 1.00 from June 2, 2001,
and at all times thereafter.
4. The Company represents and warrants that (a) the representations and
warranties contained in the Agreement are true and correct in all material
respects as of the date of this Amendment, (b) no condition, act or event which
could constitute an Event of Default under the Agreement exists, and (c) no
condition, event, act or omission has occurred, which, with the giving of notice
or passage of time, would constitute an Event of Default under the Agreement.
5. The Company agrees to pay all fees and out-of-pocket disbursements incurred
by the Bank in connection with this Amendment, including legal fees incurred by
the Bank in the preparation, consummation, administration and enforcement of
this Amendment.
6. This Amendment shall become effective only after it is fully executed by the
Company and the Bank and the Bank shall have received from the Company the
following documents:
(a) Eighth Amendment to Amended and Restated Credit Agreement;
(b) Promissory Note Modification Agreement;
(c) Any other such documents as required by the Bank.
Except as amended by this Amendment, the Agreement shall remain in full force
and effect in accordance with its terms.
7. This Amendment is a modification only and not a novation. Except for the
above-quoted modifications, the Agreement, any agreement or security document,
and all the terms and conditions thereof, shall be and remain in full force and
effect with the changes herein deemed to be incorporated therein. This Amendment
is to be considered attached to the Agreement and made a part thereof. This
Amendment shall not release or affect the liability of any guarantor, surety or
endorser of the Agreement or release any owner of collateral securing the
Agreement. The validity, priority and enforceability of the Agreement shall not
be impaired hereby. To the extent that any provision of this Amendment conflicts
with any term or condition set forth in the Agreement, or any agreement or
security document executed in conjunction therewith, the provisions of this
Amendment shall supersede and control. Company acknowledges that as of the date
of this Amendment it has no offsets with respect to all amounts owed by Company
to Bank and Company waives and releases all claims which it may have against
Bank arising under the Agreement on or prior to the date of this Amendment.
8. The Company acknowledges and agrees that this Amendment is limited to the
terms outlined above, and shall not be construed as an amendment of any other
terms or provisions of the Agreement; The Company hereby specifically ratifies
and affirms the terms and provisions of the Agreement. Company releases Bank
from any and all claims which may have arisen, known or unknown, in connection
with the Agreement on or prior to the date hereof, except those claims stemming
from
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gross negligence and willful misconduct. This Amendment shall not establish a
course of dealing or be construed as evidence of any willingness on the Bank's
part to grant other or future amendments, should any be requested.
IN WITNESS WHEREOF, the parties have entered into this Amendment as of
the day and year first above written.
BANK ONE, INDIANA, N.A. DMI FURNITURE, INC.
BY: ________________________________________ BY: _________________________
XXXXXX X. XXXXXXXX, FIRST VICE PRESIDENT
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(PRINTED NAME AND TITLE)
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ACKNOWLEDGMENT AND AGREEMENT BY GUARANTOR AND/OR OWNER
OF COLLATERAL SECURING THE PROMISSORY NOTE
The undersigned (i) consent to the modification of the Agreement and all other
matters in the foregoing Amendment and, if a guarantor (ii) reaffirm the
Guaranty Agreement, dated June 9, 1994, and any other agreements, documents and
instruments securing or otherwise relating thereto ("Guarantor Documents"),
(iii) acknowledge that the Guarantor Documents continue in full force and
effect, remain unchanged, except as specifically modified hereby, and are valid,
binding and enforceable in accordance with their respective terms, (iv) agree
that all references, if any, in the Guarantor Documents to the Agreement are
modified to refer to that document as modified by the Amendment, and (v) agree
to be bound by the release of Bank set forth in the Amendment.
DMI MANAGEMENT, INC.
BY: ____________________________
--------------------------------
(Printed Name and Title)
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