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EXHIBIT 10.1
FIFTH AMENDMENT TO
CREDIT AGREEMENT
THIS FIFTH AMENDMENT TO CREDIT AGREEMENT ("Fifth Amendment") dated as
of January 29, 1999 is by and among XXXXXXX PIANO & ORGAN COMPANY, a Delaware
corporation, (hereinafter, together with its successors in title and assigns
called "Borrower" or "Xxxxxxx"), THE FIFTH THIRD BANK, an Ohio banking
corporation, as Agent (in such capacity, the "Agent"), THE FIFTH THIRD BANK
("Fifth Third"), as a Lender, and NBD BANK, N.A., a national banking
association, ("NBD") as a Lender, (Fifth Third and NBD are hereinafter
collectively the "Lenders" and each individually a "Lender").
PRELIMINARY STATEMENT
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WHEREAS, Borrower, Agent and Lenders have entered into a Credit
Agreement dated as of October 16, 1997, as amended by a First Amendment dated as
of October 16, 1997, a Second Amendment dated as of April 27, 1998, a Third
Amendment dated June 19, 1998, a Fourth Amendment dated September 21, 1998 (the
"Credit Agreement"); and
WHEREAS, Borrower have requested Agent and Lenders to make additional
credit in the amount of $4,000,000 available to Borrower and to make various
other revisions to the Credit Agreement as set forth herein; and
WHEREAS, Borrower, Agent and Lenders now wish to amend the Credit
Agreement in accordance with the terms and provisions hereof;
NOW, THEREFORE, the parties hereto agree to supplement and amend the
Credit Agreement upon such terms and conditions as follows:
1. CAPITALIZED TERMS. All capitalized terms used herein shall have the
meanings assigned to them in the Credit Agreement unless the context
hereof requires otherwise. Any definitions as capitalized terms set
forth herein shall be deemed incorporated into the Credit Agreement
as amended by this Fifth Amendment.
2. DEFINITIONS.
a. The clause (a) of the definition of "INELIGIBLE ACCOUNTS"
is hereby amended in its entirety to read as follows:
"(a) (i) Accounts created from the sale of goods and services (other
than to Biasco) that by their terms are unpaid for more than sixty (60)
days from date of sale, (ii) prior to March 15, 1999, Accounts from
Biasco (other than the Biasco Special Account), which are unpaid for
more than one hundred thirty (130) days from date of sale and (iii)
after March 1, 1999, the Biasco Special Account;"
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b. Section 1.2 of the Credit Agreement is hereby amended to add
the following definitions to read in their entirety as
follows:
"BIASCO" shall mean Biasco Musical Instrument Company, an
Illinois corporation.
"BIASCO SPECIAL ACCOUNT" means the Account created with Biasco on
September 22, 1998 from the sale of Inventory previously on consignment with
Biasco.
3. EXHIBITS. Exhibit D to the Credit Agreement Form of Revolving
Promissory Note, is hereby amended in its entirety by Exhibit D to
this Fifth Amendment.
4. BORROWING BASE CERTIFICATE. During the period from and after the
Fifth Amendment Closing Date, Lenders hereby approve the Form of
Borrowing Base Certificate, attached as an Exhibit to this Fifth
Amendment, as the form of Borrowering Base Certificate in lieu of
the form attached as Exhibit C to the Credit Agreement.
5. TOTAL CREDIT FACILITY. Section 3.1 of the Credit Agreement is
hereby amended to change the phrase "until January 31, 1999" to
"until March 15, 1999."
6. REAFFIRMATION OF COVENANTS, WARRANTIES AND REPRESENTATIONS.
Borrower hereby agrees and covenants that all representations and
warranties in the Credit Agreement, including without limitation
all of those warranties and representations set forth in Article
9, are true and accurate as of the date hereof. Borrower further
reaffirms all covenants in the Credit Agreement, and reaffirm each
of the affirmative covenants set forth in Section 10.1, the
negative covenants set forth in Section 10.2 and the financial
covenants set forth in Section 10.3 thereof, as if fully set forth
herein, except to the extent modified by this Fifth Amendment.
7. CONDITIONS PRECEDENT TO CLOSING OF FIFTH AMENDMENT. On or prior to
the closing of the Fifth Amendment (hereinafter the "Fifth
Amendment Closing Date"), each of the following conditions
precedent shall have been satisfied:
a. PROOF OF CORPORATE AUTHORITY. Agent shall have received
from Borrower copies, certified by a duly authorized
officer to be true and complete on and as of the Fifth
Amendment Closing Date, of records of all action taken by
Borrower to authorize (i) the execution and delivery of
this Fifth Amendment and all other certificates,
documents and instruments to which it is or is to become
a party as contemplated or required by this Fifth
Amendment, and (ii) its performance of all of its
obligations under each of such documents.
b. DOCUMENTS. Each of the documents to be executed and
delivered at the Fifth Amendment Closing and all other
certificates, documents and instruments to be executed in
connection herewith shall have been duly and properly
authorized,
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executed and delivered by Borrower and shall be in full
force and effect on and as of the Fifth Amendment Closing
Date.
c. LEGALITY OF TRANSACTIONS. No change in applicable law
shall have occurred as a consequence of which it shall
have become and continue to be unlawful (i) for Agent and
each Lender to perform any of its agreements or
obligations under any of the Loan Documents, or (ii) for
Borrower to perform any of its agreements or obligations
under any of the Loan Documents.
d. PERFORMANCE, ETC. Except as set forth herein, Borrower
shall have duly and properly performed, complied with and
observed each of its covenants, agreements and
obligations contained in each of the Loan Documents.
Except as set forth herein, no event shall have occurred
on or prior to the Fifth Amendment Closing Date, and no
condition shall exist on the Fifth Amendment Closing
Date, which constitutes a Default or an Event of Default.
e. CHANGES; NONE ADVERSE. Since the date of the most recent
balance sheets of Borrower delivered to Agent, no changes
shall have occurred in the assets, liabilities, financial
condition, business, operations or prospects of Borrower
which, individually or in the aggregate, are material to
Borrower, and Agent shall have completed such review of
the status of all current and pending legal issues as
Agent shall deem necessary or appropriate.
8. MISCELLANEOUS.
a. Borrower shall reimburse Agent for all fees and
disbursements of legal counsel to Agent which shall have
been incurred by Agent in connection with the
preparation, negotiation, review, execution and delivery
of this Fifth Amendment and the handling of any other
matters incidental hereto.
b. All of the terms, conditions and provisions of the
Agreement not herein modified shall remain in full force
and effect. In the event a term, condition or provision
of the Agreement conflicts with a term, condition or
provision of this Fifth Amendment, the latter shall
govern.
c. This Fifth Amendment shall be governed by and shall be
construed and interpreted in accordance with the laws of
the State of Ohio.
d. This Fifth Amendment shall be binding upon and shall
inure to the benefit of the parties hereto and their
respective heirs, successors and assigns.
e. This Fifth Amendment may be executed in several
counterparts, each of which shall constitute an original,
but all which together shall constitute one and the same
agreement.
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IN WITNESS WHEREOF, this Fifth Amendment has been duly executed and
delivered by or on behalf of each of the parties as of the day and in the year
first above written.
XXXXXXX PIANO & ORGAN COMPANY,
Borrower
By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx
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Title: Senior Vice President and Treasurer
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THE FIFTH THIRD BANK, Agent
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
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Title: Vice President
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THE FIFTH THIRD BANK, Lender
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
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Title: Vice President
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NBD BANK, N. A., Lender
By: /s/ Xxxxxx Mosken
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Name: Xxxxxx Mosken
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Title: Vice President
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EXHIBIT D
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FORM OF THIRD AMENDED AND RESTATED REVOLVING PROMISSORY NOTE(1)
[$22,000,000.00] Cincinnati, Ohio
[January 29, 1999]
THIS THIRD AMENDED AND RESTATED REVOLVING CREDIT NOTE ("Note") is made
and entered into as of the date hereof by XXXXXXX PIANO & ORGAN COMPANY, a
Delaware corporation, (the "Borrower") to the order of [THE FIFTH THIRD BANK/NBD
BANK, N.A.] (hereinafter, together with its permitted successors and assigns,
called "Bank").
This Note has been executed and delivered pursuant to a certain Credit
Agreement dated as of October 16, 1997, as amended by First Amendment to Credit
Agreement dated October 16, 1997, Second Amendment to Credit Agreement dated as
of April, 27, 1998, Third Amendment to Credit Agreement dated as of June 19,
0000, Xxxxxx Xxxxxxxxx to Credit Agreement dated as of September 21, 1998 and a
Fifth Amendment dated as of January 29, 1999 by and among Borrower, The Fifth
Third Bank, an Ohio banking corporation, as "Agent", and the Banks listed
therein (collectively, and as the same may be further amended, modified or
restated, the "Credit Agreement"), and is subject to the terms and conditions of
the Credit Agreement, including without limitation, acceleration upon the terms
provided therein. All capitalized terms used herein shall have the meanings
assigned to them in the Credit Agreement unless the context hereof requires
otherwise.
Borrower, for value received, promises to pay to the order of Bank, at
Agent's Head Office, for the account of Bank in accordance with the Credit
Agreement, the principal sum of TWENTY-TWO MILLION AND 00/100 DOLLARS
($22,000,000.00) until March 15, 1999, and thereafter TWENTY MILLION AND 00/100
DOLLARS ($20,000,000.00) (the "Credit Commitment") or so much thereof as is
loaned by Bank pursuant to the provisions hereof and the terms and provisions of
the Credit Agreement, together with interest on the unpaid principal amount as
defined, determined and adjusted pursuant to the Credit Agreement ("Interest
Rate"). Interest shall be due and payable monthly in arrears on the first day of
each month. All interest under this Note shall be computed on the basis of the
actual number of days elapsed over an assumed year consisting of three
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(1) This Third Amended and Restated Revolving Promissory Note is issued
upon surrender of and in exchange for a Second Amended and Restated Revolving
Promissory Note dated June 19, 1998, in the original principal amount of
$22,000,000.00 having a maturity date of October 1, 2000. The issuance of this
Third Amended and Restated Revolving Promissory Note is to reflect the various
amendments that have been made to the terms of the Credit Agreement, including
but not limited to Lender replacing the Second Amended and Restated Revolving
Promissory Note, and Lender extending to Borrowers, as hereinafter defined,
additional funds under the Revolving Promissory Loan. This Third Amended and
Restated Revolving Promissory Note shall not be construed as a novation or be
construed in any manner as an extinguishment of the obligations arising under
the Amended and Restated Revolving Promissory Note, the Second Amended and
Restated Revolving Promissory Note, or to affect the priority of the security
interest granted in connection with any promissory notes executed pursuant to
the Credit Agreement as defined herein.
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hundred sixty (360) days. Principal and all remaining accrued interest
shall be due and payable on or before October 1, 2000, or as otherwise
provided in the Credit Agreement.
This Note is subject to mandatory prepayment upon the terms and
conditions set forth in the Credit Agreement. This Note may be prepaid in whole
or in part as set forth in the Credit Agreement.
If this Note is accelerated pursuant to the Credit Agreement or if a
Default or an Event of Default with respect to any monetary payment under the
Credit Agreement shall have occurred and during the period in which such Default
or Event of Default is continuing, the outstanding principal and all accrued
interest as well as any other Obligations due Bank or Agent under any Loan
Document shall bear interest at three percent (3%) above the Interest Rate.
Subject to the terms and conditions of the Credit Agreement and until
the earlier of October 1, 2000 or the earlier termination of the Credit
Agreement in accordance with its terms, Borrower may borrow, repay and reborrow
from Bank and Bank hereby agrees to lend and relend to Borrower such amounts not
to exceed Bank's Participation Percentage of the Total Credit as the Borrower
may from time to time request.
The Borrower hereby: (i) waives presentment, demand, notice of demand,
protest, notice of protest, notice of presentment and notice of nonpayment and
any other notice required to be given by law, except as otherwise specifically
provided in the Credit Agreement, in connection with the delivery, acceptance,
performance, default or enforcement of this Note, of any indorsement or guaranty
of this Note; and (ii) consents to any and all delays, extensions, renewals or
other modifications of this Note or waivers of any term hereof or the failure to
act on the part of Agent or Bank or any indulgence shown by Agent or Bank, from
time to time and in one or more instances, (without notice to or further assent
from Borrower) and agrees that no such action, failure to act or failure to
exercise any right or remedy, on the part of Agent or Bank shall in any way
affect or impair the obligations of Borrower or be construed as a waiver by Bank
of, or otherwise affect, any of Bank's rights under this Note, or under any
indorsement or guaranty of this Note. Subject to the terms of the Credit
Agreement, Borrower further agrees to reimburse Agent and Bank for all advances,
charges, costs and expenses, including reasonable attorney's fees, incurred or
paid in exercising any right, power or remedy conferred by this Note, or in the
enforcement thereof.
Anything herein to the contrary notwithstanding the obligations of
Borrower under this Note, the Credit Agreement or any other Loan Documents shall
be subject to the limitation that payments of interest shall not be required to
the extent that receipt of any such payment by any Bank would be contrary to the
provisions of law applicable to such Bank limiting the maximum rate of interest
that may be charged or collected by the Bank. Without limiting the generality of
the foregoing, all calculations of the rate of interest contracted for, charged
or received under this Note which are made for the purposes of determining
whether such rate of interest exceeds the maximum rate of interest permitted by
applicable law shall be made, to the extent permitted by applicable law, by
amortizing, prorating, allocating and spreading in equal parts during the period
of the full stated term of this Note, all interest at any time contracted for,
charged or received in connection with the indebtedness evidenced by this Note,
and then to the extent that any excess remains, all such excess shall be
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automatically credited against and in reduction of the principal balance, and
any portion of said excess which exceeds the principal balance shall be paid by
Bank to Borrower, it being the intent of the parties hereto that under no
circumstances shall Borrower be required to pay any interest in excess of the
highest rate permissible under applicable law.
The provisions of this note shall be governed by and interpreted in
accordance with the laws of Ohio.
The undersigned hereby designates all courts of record sitting in
Cincinnati, Ohio and having jurisdiction over the subject matter, state and
federal, as forums where any action, suit or proceeding in respect of or arising
from or out of this Note, its making, validity or performance, may be prosecuted
as to all parties, their successors and assigns, and by the foregoing
designation the undersigned consents to the jurisdiction and venue of such
courts.
TIME IS OF THE ESSENCE IN THE PERFORMANCE OF THE OBLIGATIONS OF THIS
NOTE.
IN WITNESS WHEREOF, the undersigned has executed this Revolving Credit
Note as of the day and year set forth above.
XXXXXXX PIANO & ORGAN COMPANY,
a Delaware corporation
By: _________________________________
Name: _________________________________
Title:_________________________________
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