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EXHIBIT 4.8
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT, dated as of June 30, 1998 (the
"Amendment"), is entered into between TELTREND INC., a Delaware corporation
("Borrower"), and LASALLE NATIONAL BANK, a national banking association
("Lender").
R E C I T A L S:
A. Borrower and Lender entered into that certain Credit Agreement, dated
as of June 14, 1995 (the "Credit Agreement").
B. Borrower has requested that Lender enter into this Amendment in order
to extend the "Revolving Credit Termination Date" (as defined in the Credit
Agreement) and make certain other amendments to the Credit Agreement as
provided herein.
C. Capitalized terms used herein and not otherwise defined shall have the
meanings provided for in the Credit Agreement.
D. In consideration of the mutual agreements contained herein the parties
hereto agree as follows:
1. AMENDMENT
Upon satisfaction of the conditions set forth in Section 2 hereof, the
Credit Agreement is amended as follows:
1.1 Section 1 of the Credit Agreement is hereby amended by restating the
definition of "Applicable Revolving Credit Loan Margin" in its entirety to read
as follows:
""APPLICABLE REVOLVING CREDIT LOAN MARGIN" shall mean (i) with
respect to the unpaid principal amount of the Revolving Credit Loan
bearing interest at the Prime Rate, zero percent (0%); and (ii) with
respect to the unpaid principal amount of the Revolving Credit Loan
bearing interest at the LIBOR Rate, one and three-quarters percent
(1.75%). "
1.2 Section 1 of the Credit Agreement is hereby amended by deleting in
their entirety the definitions of "Borrowing Base", "Borrowing Base
Certificate", "Eligible Accounts Receivable" and "Eligible Inventory".
1.3 Section 1 of the Credit Agreement is hereby amended by restating the
definition of "Revolving Credit Availability" in its entirety to read as
follows:
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""REVOLVING CREDIT AVAILABILITY" shall mean the positive difference,
if any, between (i) the Maximum Revolving Credit Loan, and (ii) the sum of
the aggregate principal amounts outstanding in respect of the Revolving
Credit Loan plus the outstanding Letter of Credit Obligations."
1.4 Section 1 of the Credit Agreement is hereby amended by restating the
definition of "Revolving Credit Termination Date" in its entirety to read as
follows:
""REVOLVING CREDIT TERMINATION DATE" shall mean the earliest of (i)
July 31, 2001, (ii) the date of termination of this facility with respect
to further Revolving Credit Advances and Letter of Credit Obligations
pursuant to Section 8 hereof, and (iii) the date of termination of this
facility with respect to further Revolving Credit Advances and Letter of
Credit Obligations pursuant to Section 9.2 hereof."
1.5 The Credit Agreement is hereby amended by restating Section 2.1(a)
thereof in its entirety to read as follows:
"(a) Upon and subject to the terms and conditions hereof, Lender
agrees to make available, from time to time, on and after the initial
Closing Date and until the Revolving Credit Termination Date, for
Borrower's use and upon the request of Borrower therefor, advances (each,
a "Revolving Credit Advance") in an aggregate amount outstanding which
shall not at any given time exceed the positive remainder of (x) the
Maximum Revolving Credit Loan, minus (y) the outstanding Letter of Credit
Obligations. Subject to the provisions of Section 8 and Section 9.2 hereof
and until all amounts outstanding in respect of the Revolving Credit Loan
shall become due and payable on the Revolving Credit Termination Date,
Borrower may from time to time borrow, repay and reborrow under this
Section 2.l(a)."
1.6 The Credit Agreement is hereby amended by deleting the last sentence
of Section 2.1(c) thereof in its entirety.
1.7 The Credit Agreement is hereby amended by restating Section 2.2(a)
thereof in its entirety to read as follows:
"(a) Lender agrees, subject to the terms and conditions hereinafter set
forth, to incur, from time to time on written request of Borrower, Letter
of Credit Obligations in respect of Letters of Credit; provided, however,
that the amount of all Letter of Credit Obligations incurred by Lender
pursuant to this Section 2.2(a) outstanding at any one time (whether or
not then due and payable) shall not exceed $3,000,000; and provided
further, however, that (A) no such Letter of Credit shall have an expiry
date which is more than one year following the date of issuance thereof,
(B) no such Letter of Credit shall have an expiry date which
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is later than 250 days following the Revolving Credit Termination Date,
and (C) the amount of such Letter of Credit shall not exceed the Revolving
Credit Availability at the time of the requested issuance of such Letter
of Credit. At the time of each request by Borrower that a Letter of Credit
be issued, Borrower shall execute and deliver to Lender an application for
such Letter of Credit in the form customarily prescribed by Lender to
issue Letters of Credit (the "Applications"). This Agreement supersedes
any terms of the Applications which are irrevocably inconsistent with the
terms hereof."
1.8 The Credit Agreement is hereby amended by restating Section 2.2(d) in
its entirety to read as follows:
"(d) In the event that Lender shall incur any Letter of Credit
Obligations pursuant hereto at the request or on behalf of Borrower
hereunder, Borrower agrees to pay to Lender, as compensation to Lender for
such Letter of Credit Obligation, (i) all costs and expenses incurred by
Lender on account of such Letter of Credit Obligation, (ii) commencing
with the date on which any Letter of Credit Obligation is incurred by
Lender with respect to a standby Letter of Credit and quarterly thereafter
for each period during which such Letter of Credit Obligation shall remain
outstanding, a fee in the amount equal to 1% per annum of the maximum
amount available from time to time to be drawn under each standby Letter
of Credit, calculated on the basis of a 360-day year and the actual number
of days elapsed and (iii) with respect to each commercial Letter of
Credit, fees in the amounts and payable on the dates from time to time
announced by Lender as being applicable thereto. In addition, Borrower
agrees to pay to Lender, on demand and for its own account, such other
customary administrative fees, charges and expenses of Lender in respect
of the issuance, negotiation, acceptance, amendment, transfer and payment
of any such Letters of Credit or otherwise payable pursuant to the
application and related documentation under which any such Letter of
Credit is issued."
l.9 The Credit Agreement is hereby amended by restating Section 2.3
thereof in its entirety to read as follows:
"2.3 MANDATORY PREPAYMENTS. In the event that the sum of the
outstanding balance of the Revolving Credit Loan plus the outstanding
Letter of Credit Obligations, shall, at any time, exceed the Maximum
Revolving Credit Loan, as determined from time to time by Lender in
accordance with the provisions of this Agreement, Borrower shall, upon
demand, after notice of such determination by Lender, repay the Revolving
Credit Loan in the amount of such excess."
1.10 The Credit Agreement is hereby amended by restating the last sentence
of Section 2.6(a) in its entirety to read as follows:
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"Borrower shall select LIBOR Rate Interest Periods with respect to LIBOR
Rate Advances so that the last day of each LIBOR Rate Interest Period is
prior to July 31, 2001."
1.11 The Credit Agreement is hereby amended by restating Section 3.7(c)
thereof in its entirety to read as follows:
"(c) The sum of the aggregate unpaid principal amount of the
Revolving Credit Loan plus the outstanding Letter of Credit Obligations,
after giving effect to such Revolving Credit Advance or the issuance of
such Letter of Credit, shall not exceed the Maximum Revolving Credit
Loan."
1.12 The Credit Agreement is hereby amended by deleting Section 5.1(d)
thereof and inserting the following in its stead:
"(d) Within 55 days after the end of each Fiscal Quarter, a copy of
Borrower's Form 10-Q as filed with the Commission and within 100 days
after the close of each Fiscal Year, a copy of Borrower's Form 10-K as
filed with the Commission."
1.13 The Credit Agreement is hereby amended by deleting Section 6.3(b)
thereof and inserting the following in its stead:
"(b) Intentionally Omitted."
1.14 The Credit Agreement is hereby amended by restating Sections 6.3(c)
and 6.3(d) thereof in their entirety to read as follows:
"(c) at all times, a Consolidated Leverage Ratio equal to or less
than 1.25 to 1.0.
"(d) at all times, a Consolidated Current Ratio equal to or greater
than 2.0 to 1.0."
1.15 Section 6 of the Credit Agreement is hereby amended by adding the
following as Section 6.16 thereof:
"6.16 YEAR 2000. Borrower and its Subsidiaries have reviewed the
areas within their business and operations which could be adversely
affected by, and have developed or are developing a program to address on
a timely basis, the "Year 2000 Problem" (that is, the risk that computer
applications used by Borrower and its Subsidiaries may be unable to
recognize and perform properly date-sensitive functions involving certain
dates prior to and any date on or after December 31, 1999), and have made
related appropriate inquiry of material
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suppliers and vendors. Based on such review and program, Borrower believes
that the "Year 2000 Problem" will not have a Material Adverse Effect on
Borrower. From time to time, at the request of Lender, Borrower and its
Subsidiaries shall provide to Lender such updated information or
documentation as is requested regarding the status of their efforts to
address the Year 2000 Problem."
1.16 The Credit Agreement is hereby amended, effective as of the beginning
of Borrower's 1999 Fiscal Year, by restating Section 7.1 thereof in its
entirety to read as follows:
"7.1 MERGERS, ETC. Neither Borrower nor any Subsidiary of Borrower
shall directly or indirectly, by operation of law or otherwise, merge or
consolidate with or into, acquire all or substantially all of the assets
or capital stock of, or otherwise combine with, any Person nor form any
Subsidiary; provided that, Borrower may acquire all or substantially all
of the assets or capital stock of any Person if (i) no Default or Event of
Default exists or would occur as a result of such acquisition, and (ii)
the total consideration paid by Borrower in connection with any such
acquisition (including the assumption of liabilities) does not exceed (x)
$15,000,000 in the aggregate in any one Fiscal Year and, (y) $20,000,000
in the aggregate in any period of two successive Fiscal Years with the
first such measurement under this clause (y) made at the end of the 2000
Fiscal Year."
1.17 The Credit Agreement is hereby amended, effective as of the beginning
of Borrower's 1999 Fiscal Year, by adding the following proviso at the end of
Section 7.2 thereof:
"; provided further, however, that, so long as no Default shall have
occurred and be continuing, Borrower may make investments in, and/or loans
or advances of money to, wholly-owned Subsidiaries of Borrower in an
amount not to exceed at any time $7,000,000 in the aggregate of total
investments and outstanding loans and advances made during Fiscal Year
1999 and thereafter, plus any amount permitted under Section 7.1 in
connection with any acquisition permitted under such Section and
effectuated by a Subsidiary of Borrower."
1.18 The Credit Agreement is hereby amended, effective as of the beginning
of Borrower's 1999 Fiscal Year, to restate Section 7.10 thereof in its entirety
to read as follows:
"7.10 CAPITAL EXPENDITURES. Borrower shall not and shall not permit
any of its Subsidiaries to make Capital Expenditures (exclusive of
Building Expenditures) that, in the aggregate, exceed $8,000,000 in any
Fiscal Year (the "Capital Expenditure Limit"); provided, however, that not
more than 50% of the Capital Expenditure Limit not expended in one Fiscal
Year may be expended in the immediately succeeding Fiscal Year after
expending the permitted amount specified above for such succeeding Fiscal
Year. Borrower shall not and shall
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not permit any of its Subsidiaries to make Building Expenditures (as
defined below) provided, however, that if no Default or Event of Default
exists or would occur as a result thereof Borrower may make Building
Expenditures that, taken together with all other Building Expenditures
made during the period beginning with the 1999 Fiscal Year, do not exceed
$35,000,000 in the aggregate. For purposes of this Section 7.10, the term
"Building Expenditures" shall mean Capital Expenditures incurred for the
purpose of purchasing real estate or for the purpose of purchasing or
constructing buildings or improvements (exclusive of fixtures and
equipment therefor) for use by Borrower in the ordinary course of its
business."
1.19 The Credit Agreement is hereby amended, effective as of the beginning
of Borrower's 1999 Fiscal Year to restate Section 7.14 thereof in its entirety
to read as follows:
"7.14 RESTRICTED PAYMENTS. Borrower shall not make any Restricted
Payments nor shall it permit any Subsidiary to make a Restricted Payment;
provided, however, that so long as no Default or Event of Default has
occurred (which has not been waived) or would occur as a result of the
payment thereof, (i) Borrower may in any Fiscal Year declare and pay
dividends on its Stock in an aggregate amount not to exceed 50% of
Borrower's Consolidated Net Income for the immediately preceding Fiscal
Year, and (ii) Borrower may purchase shares of its common stock beginning
with the 1999 Fiscal Year and thereafter, provided that the aggregate
consideration paid for such purchases during such period does not exceed
$10,000,000."
1.20 The Credit Agreement is hereby amended by restating paragraph (a) of
Section 10.11 thereof in its entirety to read as follows:
"(a) If to Lender, at
LaSalle National Bank
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Telecopier No. (000) 000-0000"
1.21 The Credit Agreement is hereby amended by deleting Exhibit C thereto
and labelling Exhibit C as "Intentionally Omitted".
1.22 Schedule 4.3 of the Credit Agreement is hereby restated in its
entirety to read as provided in Schedule 4.3 attached hereto.
1.23 Schedules 4.7(a) and 4.7(b) of the Credit Agreement are hereby
restated in their entirety to read as provided in Schedules 4.7(a) and 4.7(b)
attached hereto.
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1.24 Exhibit E of the Credit Agreement is hereby restated in its entirety,
effective as of the beginning of Borrower's 1999 Fiscal Year, to read as
provided in Exhibit E attached hereto.
2. CONDITIONS PRECEDENT
This Amendment shall become effective upon the satisfaction of the
following conditions precedent:
2.1 This Amendment or counterparts thereof shall have been executed by and
delivered to, Borrower and Lender; and
2.2 Lender shall have received each of the following, each in form and
substance satisfactory to Lender:
(a) A replacement Revolving Credit Note in the form of Exhibit A
attached hereto;
(b) A Certificate of the Secretary of Borrower, together with true and
correct copies of the Certificate of Incorporation and By-Laws of
Borrower, and all amendments thereto, true and correct copies of the
resolutions of the Board of Directors of Borrower authorizing or ratifying
the execution, delivery and performance of this Amendment, and the names
of the officer or officers of Borrower authorized to sign this Amendment,
together with a sample of the true signature of each such officer; and
(c) Good Standing Certificates for Borrower from the Secretaries of
State of Delaware and Illinois;
3. MISCELLANEOUS
3.1 LIMITED NATURE OF AMENDMENTS. The parties hereto acknowledge and agree
that the terms and provisions of this Amendment amend, add to and constitute a
part of the Credit Agreement. Except as expressly modified and amended by the
terms of this Amendment, all of the other terms and conditions of the Credit
Agreement and all documents executed in connection therewith or referred to or
incorporated therein remain in full force and effect and are hereby ratified,
reaffirmed, confirmed and approved.
3.2 CONFLICT. If there is an express conflict between the terms of this
Amendment and the terms of the Credit Agreement, or any of the other agreements
or documents executed in connection therewith or referred to or incorporated
therein, the terms of this Amendment shall govern and control.
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3.3 COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall be deemed to be an original.
3.4 REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to
Lender as follows: (A) Borrower has all necessary power and authority to
execute and deliver this Amendment and perform its obligations hereunder; (B)
this Amendment and the Credit Agreement, as amended hereby, constitute the
legal, valid and binding obligations of Borrower and are enforceable against
Borrower in accordance with their terms; and (C) all representations and
warranties of Borrower contained in the Credit Agreement and all other
agreements, instruments and other writings relating thereto are true and
complete as of the date hereof.
3.5 GOVERNING LAW. This Amendment shall be construed in accordance with
and governed by and the internal laws of the State of Illinois, without giving
effect to choice of law principles.
IN WITNESS WHEREOF, Borrower and Lender have caused this Amendment to be
duly executed by their respective authorized officers as of the day and year
first above written.
TELTREND INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President Finance
LASALLE NATIONAL BANK
By: /s/ Xxxxx X. Xxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President
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SCHEDULE 4.3
TO
CREDIT AGREEMENT
SUBSIDIARIES
ENTITY JURISDICTION OF INCORPORATION
Teltrend 3net, Inc. Delaware
Teltrend Limited England and Wales
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SCHEDULE 4.7(a)
TO
CREDIT AGREEMENT
OWNED REAL ESTATE
Property located at the corner of
Xxxxx Road and Xxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxx 00000
0000 Xxxxx Xxxxxx
Xx. Xxxxxxx, Xxxxxxxx 00000
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SCHEDULE 4.7(b)
TO
CREDIT AGREEMENT
LEASED REAL PROPERTY
000 Xxxxxxx Xxxxxx
Xx. Xxxxxxx, Xxxxxxxx 00000
0000 Xxxx Xxxxxx
Xx. Xxxxxxx, Xxxxxxxx 00000
00 Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
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EXHIBIT A
REVOLVING CREDIT NOTE
$15,000,000 Chicago, Illinois
June 30, 1998
FOR VALUE RECEIVED, the undersigned, TELTREND INC., a Delaware corporation
(hereinafter referred to as "Borrower"), hereby PROMISES TO PAY to the order of
LASALLE NATIONAL BANK, a national banking association ("Lender"), or its
assigns, at 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, or at such other
place as the holder of this Note may designate from time to time in writing, in
lawful money of the United States of America and in immediately available
funds, the principal amount of FIFTEEN MILLION DOLLARS ($15,000,000), or such
lesser principal amount as may be outstanding pursuant to the Credit Agreement
(as hereinafter defined) with respect to the Revolving Credit Loan, together
with interest on the unpaid principal amount of this Note outstanding from time
to time
This Note is the Revolving Credit Note issued pursuant to Section 2.1 of
that certain Credit Agreement dated as of June 14, 1995, as amended, between
Borrower and Lender (the "Credit Agreement"), to which reference is hereby made
for a statement of all of the terms and conditions under which the loan
evidenced hereby is made. All capitalized terms herein. unless otherwise
defined, shall have the meanings ascribed to them in the Credit Agreement.
The principal amount of the indebtedness evidenced hereby shall be payable
in the amounts and on the dates specified in the Credit Agreement and, if not
sooner paid in full, on July 31, 2001. Interest thereon, less any taxes payable
by withholding, shall be paid until such principal amount is paid in full at
such interest rates and at such times as are specified in the Credit Agreement.
If any payment on this Note becomes due and payable on a day other than a
Business Day, the maturity thereof shall be extended to the next succeeding
Business Day and, with respect to payments of principal, interest thereon shall
be payable at the then applicable rate during such extension.
Upon and after the occurrence of an Event of Default, this Note shall or
may, as provided in the Credit Agreement, and without demand, notice or legal
process of any kind, become or be declared immediately due and payable.
Demand, presentment, protest and notice of nonpayment and protest are
hereby waived by Borrower.
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This Note shall be interpreted, governed by, and construed in accordance
with, the laws of the State of Illinois.
This Note is issued in substitution for, and in replacement of that
certain Revolving Credit Note, dated June 14, 1995, and made payable to Lender
in the stated principal amount of Fifteen Million Dollars ($15,000,000) (the
"Original Note"). The replacement of the Original Note with this Note shall not
be construed to deem paid or forgiven the unpaid principal amount of, or unpaid
accrued interest on, the Original Note outstanding at the time of replacement.
TELTREND INC.
By
--------------------------------
Name:
---------------------------
Title:
--------------------------
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EXHIBIT E
COMPLIANCE CERTIFICATE TO ACCOMPANY MONTHLY
AND ANNUAL FINANCIAL STATEMENTS
Certificate of _____________
of Teltrend Inc.
For the Period Ended _________
The undersigned,_________ , hereby certifies to LaSalle National Bank
("Lender") in connection with that certain Credit Agreement dated as of June
14, 1995, as amended ("Credit Agreement") by and between Lender and Teltrend
Inc. ("Borrower"), as follows (all capitalized terms used herein and not
otherwise defined shall have the meanings set forth in the Credit Agreement):
(i) that the undersigned is the [_______] of Borrower;
(ii) that the accompanying [monthly] [annual] financial statements of
Borrower dated as of _______,_______ , delivered pursuant to Subsection 5.1
[(a) or (b)] of the Credit Agreement, are true and complete copies of such
financial statements, which present fairly in accordance with generally
accepted accounting principles the consolidated financial condition and
results of operations and the consolidated statement of cash flows of
Borrower and its Subsidiaries as of the respective dates and for the
respective periods indicated and that, as of the date hereof, there exist
no facts or circumstances which would materially adversely affect or vary
the information contained therein;
(iii) that no Default or Event of Default has occurred, except:
[describe the nature of each Default and/or Event of Default, the period
of existence thereof and the action taken or proposed to be taken with
respect thereto];
(iv) that all of the representations and warranties contained in the
Credit Agreement are true, correct and accurate in all material respects
as of the date hereof as if made on the date hereof;
(v) that the aggregate amount of Indebtedness of the Borrower and its
Subsidiaries in respect of Capital Lease Obligations and purchase money
indebtedness was $__________ ;
the aggregate amount of the aforementioned Indebtedness permitted
pursuant to Section 7.3(a)(ii) and 7.9(c) was $3,000,000 and, accordingly,
the aforementioned requirement has been satisfied;
(vi) that Consolidated Net Income was $________________;
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the minimum Consolidated Net Income of Borrower at the end of each
Fiscal Quarter required pursuant to clause (a) of Section 6.3 is $1.00
and accordingly, the aforementioned requirement has been satisfied;
(vii) that the Consolidated Leverage Ratio was ______, as computed on
Attachment A hereto;
the maximum Consolidated Leverage Ratio permitted pursuant to clause
(c) of Section 6.3 was 1.25:1, and, accordingly, the aforementioned
Consolidated Leverage Ratio requirement has been satisfied.
(viii) that the Consolidated Current Ratio was ______, as computed on
Attachment B hereto.
the minimum Consolidated Current Ratio permitted pursuant to clause
(d) of Section 6.3 was 2.0:1 and, accordingly, the aforementioned
Consolidated Current Ratio requirement has been satisfied;
(ix) that the aggregate amount of permitted acquisitions made
pursuant to Section 7.1 was $_______ during the current Fiscal Year and
(with the first such measurement to be made at the end of the 2000 Fiscal
Year) $_________ during the two immediately preceding Fiscal Years;
the aggregate amount of the aforementioned permitted acquisitions
permitted pursuant to Section 7.1 is $15,000,000 in the aggregate in any
one Fiscal Year and, $20,000,000 in the aggregate in any period of two
successive Fiscal Years, and, accordingly, the aforementioned requirement
has been satisfied with the first such measurement to be made at the end
of the 2000 Fiscal Year;
(x) that the aggregate amount of Restricted Payments consisting of
the declaration and payment of dividends on Borrower's stock made pursuant
to Section 7.14 was $_______ during the Fiscal Year;
the maximum aggregate amount of the aforementioned dividend payments
on Borrower's Stock permitted pursuant to Section 7.14 is $ _______ which
is not to exceed 50% of Borrower's Consolidated Net Income for the
immediately preceding Fiscal Year, and, accordingly, the aforementioned
requirement has been satisfied;
(xi) that the aggregate amount of Restricted Payments consisting of
the purchase by Borrower of shares of its common stock was $__________
during the portion of the three consecutive Fiscal Years beginning with
the 1999 Fiscal Year;
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the maximum aggregate consideration for purchases by Borrower of its
common stock during the three consecutive Fiscal Year period beginning
with the 1999 Fiscal Year is $10,000,000, and, accordingly, the
aforementioned requirement has been satisfied;
(xii) that the aggregate amount of Capital Expenditures during the
current Fiscal Year was $_________ , and the aggregate Building
Expenditures to date for the period beginning in the 1999 Fiscal Year was
$_______, each as computed on Attachment C hereto;
the aggregate amount of Capital Expenditures permitted during the
current Fiscal Year pursuant to Section 7.10 was $_______ , as computed on
Attachment D hereto and, the aggregate Building Expenditures for the
period beginning in the 1999 Fiscal Year is $35,000,000, and, accordingly,
the aforementioned requirement has been satisfied;
(xiii) that the aggregate amount of employee loans are $_______
pursuant to Section 7.4;
the maximum aggregate outstanding principal amount of employee loans
at any time is not to exceed $250,000 pursuant to Section 7.4, and,
accordingly, the aforementioned requirement has been satisfied.
(xiv) that the aggregate amount of total investments in and
outstanding loans and advances to wholly-owned Subsidiaries of Borrower is
$__________ ;
the maximum aggregate amount of total investments in and outstanding
loans and advances to wholly-owned Subsidiaries of Borrower is not to
exceed $7,000,000 during Fiscal Year 1999 and thereafter, plus any amount
permitted under Section 7.1 of the Credit Agreement in connection with any
acquisition permitted under such Section and effectuated by a Subsidiary
of Borrower, and, accordingly, the aforementioned requirement has been
satisfied.
IN WITNESS WHEREOF, the Borrower has caused this Certificate to be duly
executed and delivered by its duly Authorized Officer this ___ day
of_________,____.
_______________________________
[Signature]
_______________________________
[Title]
Date:__________________________
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ATTACHMENT A
CONSOLIDATED LEVERAGE RATIO
1. Consolidated Assets (as set forth on
Borrower's most recent Financial Statement) $__________
2. Consolidated Liabilities of Borrower (as set
forth on Borrower's most recent Financial
Statement) $__________
3. Net Worth of Borrower: Item 1 less Item 2 $__________
4. Intangibles (as defined in the Loan Agreement) $__________
5. Loans to Employees and Affiliates $__________
6. Tangible Net Worth of Borrower: Item 3 less
Items 4 and 5 $__________
7. Consolidated Liabilities of Borrower $__________
8. Leverage Ratio: Item 7 divided by Item 6
(expressed as ratio) __________
Maximum Consolidated Leverage Ratio: 1.25 to 1.0
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ATTACHMENT B
CONSOLIDATED CURRENT RATIO
(IN THOUSANDS)
1. Current Assets: All amounts which, in $__________
accordance with GAAP, would be included as
current assets on a consolidated balance sheet
of the Borrower and its Subsidiaries excluding
deferred taxes
2. Current Liabilities: All amounts which, in
accordance with GAAP, would be included as $__________
current liabilities on a consolidated balance
sheet of the Borrower, excluding Revolving
Credit Advances and Letter of Credit
Obligations
3. Current Ratio: The ratio of Item 1 to Item 2 __________
Minimum Consolidated Current Ratio: 2.0 to 1.0
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ATTACHMENT C
MAXIMUM AMOUNT OF CONSOLIDATED CAPITAL
EXPENDITURES ALLOWABLE PER COVENANT
(IN THOUSANDS)
1. Base Amount of Capital Expenditures for Fiscal $__________
Year [______](not to exceed Permitted Capital
Expenditures listed below)
2. Permitted Capital Expenditure for prior Fiscal
Year [______] $__________
3. Actual Capital Expenditure for prior Fiscal Year
[_______] $__________
4. Carry-Forward Amount for Fiscal Year _____:
50% of the positive difference between Line 2 $__________
and Line 3
5. Maximum Capital Expenditure:
Line 1 plus Line 4 $__________
Permitted Capital Expenditures for the
1999 Fiscal Year and thereafter: $8,000,000
Permitted Capital Expenditures for the
1998 Fiscal Year $4,500,000
6. Aggregate Building Expenditures during the
period beginning in the 1999 Fiscal Year $__________
Permitted Aggregate Building Expenditures: $35,000,000
