Exhibit 4.16
Midas International Corporation.
0000 Xxxxxxxxx Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
New York, New York
As of December 27, 2002
Re: Amendment No. 2 to Note and Guarantee Agreement,
dated as of April 15, 1998, as amended
To the Holders of the Notes
Referred to Below
Ladies and Gentlemen:
Reference is made to the Note and Guarantee Agreement dated as of
April 15, 1998 (as in effect on the date hereof, the "Agreement") among
Midas International Corporation, a Delaware corporation (the "Company"),
Midas, Inc., a Delaware corporation (the "Guarantor" and, together with the
Company, the "Obligors") and the purchasers whose names appear in the
acceptance form at the end thereof (each, a "Purchaser" and, collectively,
the "Purchasers"), pursuant to which the Purchasers purchased $75,000,000
aggregate principal amount of the Company's 6.89% Guaranteed Senior Notes
due 2005 (the "Notes").
The Company has requested that the holders of the Notes, and the
holders of the Notes party hereto are willing to, amend Section 10.6 of the
Agreement as provided herein, all on the terms and conditions of this
Amendment.
Accordingly, in consideration of the premises and the mutual
agreements contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
Section 1. Definitions. Unless otherwise defined herein, all terms used
herein that are defined in the Agreement (as amended hereby) shall have their
respective meanings as therein defined.
Section 2. Amendments to Agreement. Subject to the satisfaction of the
conditions to effectiveness specified in Section 4 below, but with effect on and
after the date hereof
2.1 Section 10.6. Section 10.6 of the Agreement shall be amended and
restated to read in its entirely as follows:
"Section 10.6 Consolidated Indebtedness Ratio. The Guarantor will not
permit the ratio of Consolidated Indebtedness to EBITDA to exceed (i) 4.25
to 1.00 as at the end of the fiscal quarter
of the Guarantor ending December 28, 2002 and (ii) 3.5 to 1:00 as at the
end of any other fiscal quarter of the Guarantor."
2.2 Further Restrictions on Liens. Notwithstanding anything in the
Agreement to the contrary, after December 27, 2002, the Guarantor will not,
and will not permit any Subsidiary to, create, assume, incur, guarantee or
otherwise become liable in respect of any Priority Indebtedness other than
the Excess Advances, and the Guarantor will not, and will not permit any
Subsidiary to, grant, create, assume or incur any Lien to secure Priority
Indebtedness upon or with respect to any property or assets, whether now
owned or hereafter acquired, of the Guarantor or any such Subsidiary other
than Liens granted and required to be granted pursuant to section 1(j) of
the Sixth Bank Amendment; provided that the Guarantor and any Subsidiary
shall be allowed to incur unsecured trade debt in the ordinary course of
business. The undersigned Purchasers hereby acknowledge that the granting
of Liens in connection with the Sixth Bank Amendment and the incurring of
the Excess Advances did not and will not constitute a violation of the
terms of the Agreement. Any default under this Section 2.2 will constitute
an Event of Default under the Agreement. For purposes of the preceding
sentence,
"Excess Advances" shall have the meaning specified in section 1(j) of
the Sixth Bank Amendment;
"Priority Indebtedness" shall have the same meaning as the meaning of
Priority Debt set forth in the Agreement, but without giving effect to the
exclusion in clause (ii) of the definition of "Priority Debt"; and
"Sixth Bank Amendment" shall mean the Amendment No. 6 and Waiver to
Credit Agreement dated as of November 12, 2002 by and among the Obligors,
Bank One, NA, as administrative agent, Credit Suisse First Boston, as
co-agent, and the lenders signatory thereto.
Section 3. Representations and Warranties of the Obligors. The Company and
the Guarantor jointly and severally represent and warrant to the holders of the
Notes as follows (and the parties hereto agree that the following
representations and warranties shall be deemed to have been made pursuant to the
Agreement for all relevant purposes thereof):
3.1. Power and Authority. Each Obligor has the corporate power and
authority to execute and deliver this Amendment and to perform the
Agreement as amended hereby (the "Amended Agreement").
3.2. Authorization. etc. This Amendment has been duly authorized by
all necessary corporate action on the part of each Obligor, and has been
duly executed and delivered by each Obligor, and the Amended Agreement
constitutes a legal, valid and binding obligation of each Obligor,
enforceable against such Obligor, in accordance with its terms, except as
such enforcement may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement
of creditors' rights generally and (ii) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
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3.3. No Conflicts. The execution, delivery and performance by the
Obligors of this Amendment and of the Amended Agreement will not (i)
contravene, result in any breach of, or constitute a default under, or
result in the creation of any Lien in respect of any property of either
Obligor or any Subsidiary under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, corporate charter or by-laws, or
any other agreement or instrument to which either Obligor or any Subsidiary
is bound or by which either Obligor or any Subsidiary or any of their
respective properties may be bound or affected, (ii) conflict with or
result in a breach of any of the terms, conditions or provisions of any
order, judgment, decree, or ruling of any court, arbitrator or Governmental
Authority applicable to either Obligor or any Subsidiary or (iii) violate
any provision of any statute or other rule or regulation of any
Governmental Authority applicable to either Obligor or any Subsidiary.
3.4. No Defaults. Both immediately prior and after-giving effect to
this Amendment, no Default or Event of Default has occurred and is
continuing.
3.5 Bank Agreement. The copy of the Credit Agreement (as defined
below) being provided concurrently herewith is a true and correct copy of
the Credit Agreement including all amendments through the date hereof.
Section 4. Conditions to Effectiveness. The amendment to the Agreement set
forth in Section 2 shall become effective, as of the date hereof, upon the
satisfaction of the following conditions:
4.1 Amendment. Execution and delivery of this Amendment by the
Obligors and the Required Holders.
4.2 Consent. Written confirmation from Bank One, NA, as administrative
agent, that this Amendment is acceptable to the required holders under that
certain Credit Agreement, dated as of January 22, 1998 between the Company,
the Guarantor, the administrative agent and the lenders party thereto (the
"Credit Agreement").
Section 5. Miscellaneous.
5.1. Costs and Expenses. As provided in Section 16.1 of the Agreement,
the Obligors agree to pay on demand all costs and expenses (including
reasonable attorney's fees of a single special counsel and, if reasonably
required, local or other counsel) of the holders of the Notes in connection
with the negotiation, preparation, execution and delivery of this Amendment
and any documents executed pursuant hereto.
5.2. Ratification/Waiver. The Agreement, except as amended pursuant
hereto, is in all respects ratified and confirmed, and the terms, covenants
and agreements thereof shall remain in full force and effect.
5.3. References to Agreement and Notes. From and after the date
hereof, all references to the Agreement in the Agreement, the Notes, the
Guarantee and all documents and instruments incident to the transactions
contemplated by the Agreement, shall be deemed to be references to the
Agreement as amended by this Amendment.
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5.4. Governing Law. This Amendment shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the
law of the State of New York excluding choice-of-law principles of the law
of such State that would require the application of the laws of a
jurisdiction other then such State.
5.5. Execution in Counterparts. This Amendment may be executed in
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
(SIGNATURE PAGES FOLLOW]
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If you are in agreement with the foregoing, please sign the form of
acceptance in the space provided below whereupon this Amendment shall become a
binding agreement between you and the Obligors.
Very truly yours,
MIDAS INTERNATIONAL CORPORATION
By:_______________________________
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
Chief Financial Officer
MIDAS, INC.
By:_______________________________
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
Chief Financial Officer
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ACCEPTED AND AGREED:
CONNECTICUT GENERAL LIFE INSURANCE COMPANY
By CIGNA Investments, Inc.
By_____________________________
Name:
Title:
CONNECTICUT GENERAL LIFE INSURANCE
COMPANY ON BEHALF OF ONE OR MORE
SEPARATE ACCOUNTS
By CIGNA Investments, Inc.
By_____________________________
Name:
Title:
CANADA LIFE INSURANCE
COMPANY OF AMERICA
By_____________________________
Name:
Title:
CANADA LIFE INSURANCE
COMPANY OF NEW YORK
By_____________________________
Name:
Title:
SOUTHERN FARM BUREAU LIFE
INSURANCE COMPANY
By_____________________________
Name:
Title:
AMERICAN GENERAL LIFE
INSURANCE COMPANY, and
THE UNITED STATES LIFE INSURANCE
COMPANY IN THE CITY OF NEW YORK
By: AIG Global Investment Corp.
By_____________________________
Name:
Title:
6
THE TRAVELERS INSURANCE COMPANY
By_____________________________
Name:
Title:
FIRST TRENTON INDEMNITY COMPANY
By_____________________________
Name:
Title:
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