EXHIBIT 10(x)
CARSEN GROUP INC.
as Borrower
- and -
CANTEL INDUSTRIES, INC.
as Guarantor
- and -
NATIONAL BANK OF CANADA
as Lender
--------------------------------------------------------------------------------
THIRD LOAN AMENDING AGREEMENT
--------------------------------------------------------------------------------
Dated as of March 7, 1997
THIRD LOAN AMENDING AGREEMENT dated as of March 7, 1997 among CARSEN
GROUP INC. (the "Borrower"), a corporation incorporated and subsisting under the
laws of Ontario, as borrower, CANTEL INDUSTRIES, INC. ("Cantel"), a corporation
incorporated and subsisting under the laws of Delaware and NATIONAL BANK OF
CANADA (the "Lender"), as lender.
WHEREAS the Borrower, the Lender and Cantel are parties to a loan
agreement dated as of October 29, 1993 (the "Original Loan Agreement")
pursuant to which the Lender agreed to make extensions of credit to the Borrower
on the terms and conditions contained therein and Cantel agreed to make certain
commitments with respect to the Borrower's obligations to the Lender;
AND WHEREAS the Borrower, the Lender and Cantel amended the Original
Loan Agreement pursuant to a First Loan Amending Agreement dated as of August
28, 1995 (the "First Loan Amending Agreement");
AND WHEREAS the Borrower, the Lender and Cantel further amended the
Original Loan Agreement pursuant to a Second Loan Amending Agreement dated as of
April 19, 1996 (the "Second Loan Amending Agreement") (the Original Loan
Agreement, as amended by the First Loan Amending Agreement and the Second Loan
Amending Agreement is hereinafter referred to as the "Loan Agreement");
AND WHEREAS Section 8.05 of the Loan Agreement provides, inter alia,
that no amendment or waiver of any provision of the Loan Agreement shall be
effective unless consented to in writing by the Lender;
AND WHEREAS the Borrower has requested that the Lender, inter alia,
(i) extend the Repayment Date to December 31, 1999; (ii) reduce the Commitment
to U.S. $5,000,000, and reduce the Lending Limit accordingly; (iii) amend the
interest rates applicable to both Canadian Dollar Advances and U.S. Dollar
Advances; and (iv) amend the Drawing Fee.
AND WHEREAS the Lender has agreed, subject to the terms and
conditions set out herein, to permit such amendments to the Loan Agreement;
AND WHEREAS Cantel wishes to confirm the continuing validity of the
Letter of Guarantee and its agreement with the terms and conditions of this
Second Loan Amending Agreement;
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of
the premises and the mutual covenants herein contained and other good and
valuable consideration, the parties hereto agree as follows:
-2-
ARTICLE I
INTERPRETATION
1.1 Defined Terms. In this Third Loan Amending Agreement and the recitals
hereto, unless there is something in the subject matter or context inconsistent
therewith or unless otherwise expressly provided:
"Third Loan Amending Agreement", "herein", "hereby", "hereof" and
similar expressions mean or refer to this Third Loan Amending
Agreement.
In this Third Loan Amending Agreement and the recitals hereto, unless there is
something in the subject matter or context inconsistent therewith, or unless so
stated to the contrary in this Third Loan Amending Agreement, the words and
expressions herein contained, which are defined in the Loan Agreement, shall
have the meanings given to such words and expressions in the Loan Agreement.
1.2 Interpretation not Affected by Headings, etc. The division of this Third
Loan Amending Agreement into Articles and Sections and the insertion of headings
are for convenience of reference only and shall not affect the construction or
interpretation hereof.
ARTICLE II
AMENDMENTS TO THE LOAN AGREEMENT
2.1 Amendments to Section 1.01 of the Loan Agreement. (1) The definition of
"Quarterly Financial Statements" is hereby added to Section 1.01 of the Loan
Agreement as follows:
"Quarterly Financial Statements" means those monthly financial
statements delivered by the Borrower pursuant to Section 6.01 of the
Loan Agreement for any of the months of October, January, April or
July in any given year.
(2) The definition of "Commitment" in Section 1.01 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:
"Commitment" means, for the period commencing on January 10, 1997
and ending on the Repayment Date, U.S. $5,000,000, subject to any
-3-
reduction made at the election of the Borrower in accordance with
the terms of this Loan Agreement.
(3) The definition of "Drawing Fee" in Section 1.01 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:
"Drawing Fee" means, with respect to each Draft drawn by the
Borrower hereunder and purchased by any Person on any Drawing Date,
an amount determined as follows:
(a) where such Draft is drawn on or after the date hereof and on
or before the ninth day following the Borrower's next delivery
of Quarterly Financial Statements to the Lender, an amount
equal to 1.25% of the aggregate Face Amount of such Draft; and
(b) thereafter, with respect to any Draft drawn on or after the
tenth day following a delivery of Quarterly Financial
Statements (the "Prior Financial Statements") by the Borrower
and on or before the ninth day following the next following
delivery of Quarterly Financial Statements by the Borrower, an
amount equal to:
(i) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal to or more
than 1.5:1, 1.75 % of the aggregate Face Amount of such
Draft; and
(ii) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal to or more
than 1:1 but less than 1.5:1, 1.5% of the aggregate Face
Amount of such Draft; and
(iii) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal to or more
than 0.5:1 but less than 1:1, 1.25% of the aggregate
Face Amount of such Draft; and
(iv) where the Borrower's Debt to Equity ratio is less than
0.5:1, as indicated by the Prior Financial Statements,
1% of the aggregate Face Amount of such Draft,
calculated on the basis of the term to maturity of such Draft and a
year of 365 days.
-4-
(4) The definition of "Lending Limit" in Section 1.01 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:
"Lending Limit" means, subject to any reduction made at the election
of the Borrower in accordance with Section 2.23, (i) for the period
commencing on January 10, 1997 and ending on the Repayment Date, the
lesser of U.S. $5,000,000 (or the Equivalent Cdn. $ Amount) and the
Margin Requirement.
(5) The definition of "Repayment Date" in Section 1.01 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:
"Repayment Date" means, in respect of repayment of all
Accommodations made hereunder, December 31, 1999.
2.3 Amendment to Section 2.06 of the Loan Agreement. Section 2.06 of the Loan
Agreement is hereby deleted in its entirety and the following substituted
therefor:
"Subject to Section 2.08, the Borrower shall pay interest on the
unpaid principal amount of each Canadian Dollar Advance made to it
from the date of such Canadian Dollar Advance until such principal
amount shall be repaid in full, at a rate per annum determined as
follows:
(a) for the period commencing on the date hereof and ending on the
ninth day following the Borrower's next delivery of Quarterly
Financial Statements, at a rate equal to the Prime Rate in
effect from time to time plus 0.25% per annum; and
(b) thereafter, for every period commencing on the tenth day
following a delivery of Quarterly Financial Statements (the
"Prior Financial Statements") by the Borrower and ending on
the ninth day following the next following delivery of
Quarterly Financial Statements by the Borrower, at a rate per
annum determined as follows:
(i) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal or more than
1.5:1, the sum of the Prime Rate in effect from time to
time plus 0.75%; and
(ii) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal to or more
than 1:1
-5-
but less than 1.5:1, the sum of the Prime Rate in effect
from time to time plus 0.5%; and
(iii) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal to or more
than 0.5:1 but less than 1:1, the sum of the Prime Rate
in effect from time to time plus 0.25%; and
(iv) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is less than 0.5:1,
the Prime Rate in effect from time to time,
in each case, calculated and payable (i) in arrears on the 26th day
of each month in each year; and (ii) when such Canadian Dollar
Advance becomes due and payable in full. Any amount of principal of
or interest on any such Canadian Dollar Advance which is not paid
when due (whether at stated maturity, by acceleration or otherwise)
shall bear interest both before and after judgment), from the date
on which such amount is due until such amount is paid in full,
payable on demand, at the same applicable rates per annum as
aforesaid;"
2.4 Amendment to Section 2.07 of the Loan Agreement. Section 2.07 of the Loan
Agreement is hereby deleted in its entirety and the following substituted
therefor:
"Subject to Section 2.08, the Borrower shall pay interest on the
unpaid principal amount of each U.S. Dollar Advance made to it from
the date of such U.S. Dollar Advance until such principal amount
shall be repaid in full, at a rate per annum determined as follows:
(a) for the period commencing on the date hereof and ending on the
ninth day following the Borrower's next delivery of Quarterly
Financial Statements, at a rate equal to the U.S. Base Rate in
effect from time to time plus 0.25% per annum; and
(b) thereafter, for every period commencing on the tenth day
following a delivery of Quarterly Financial Statements (the
"Prior Financial Statements") by the Borrower and ending on
the ninth day following the next following delivery of
Quarterly Financial Statements by the Borrower, at a rate
equal to:
(i) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal or more than
1.5:1,
-6-
the sum of the U.S Base Rate in effect from time to time
plus 0.75%; and
(ii) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal to or more
than 1:1 but less than 1.5:1, the sum of the U.S. Base
Rate in effect from time to time plus 0.5%; and
(iii) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is equal to or more
than 0.5:1 but less than 1:1, the sum of the U.S. Base
Rate in effect from time to time plus 0.25 %; and
(iv) where the Borrower's Debt to Equity ratio, as indicated
by the Prior Financial Statements, is less than 0.5:1,
the U.S. Base Rate in effect from time to time,
in each case, calculated daily and payable (i) in arrears on the
26th day of each month in each year; and (ii) when such U.S. Dollar
Advance becomes due and payable in full. Any amount of principal of
or interest on any such U.S. Dollar Advance which is not paid when
due (whether at stated maturity, by acceleration or otherwise)
shall bear interest (both before and after judgment), from the date
on which such amount is due until such amount is paid in full,
payable on demand, at the same applicable rates per annum as
aforesaid;"
2.6 Amendment to Section 2.16 of the Loan Agreement. Section 2.16 of the Loan
Agreement, which was added to the Loan Agreement pursuant to Section 2.2 of the
Second Loan Amending Agreement, is hereby renumbered as Section 2.23 of the Loan
Agreement.
ARTICLE III
MISCELLANEOUS
3.1 Representations and Warranties; No Default. On and as of the date of
execution of this Third Loan Amending Agreement and after giving effect to this
Third Loan Amending Agreement, the Borrower and Cantel jointly and severally (a)
confirm, reaffirm and restate the representations and warranties set forth in
Article 5 of the Loan Agreement, except to the extent that such representations
and warranties relate solely to an earlier date in which case the Borrower and
Cantel jointly and severally confirm, reaffirm and restate such representations
and warranties for such earlier date in all material respects, provided that the
references therein shall be deemed to be to the Loan
-7-
Agreement as amended by this Third Loan Amending Agreement; and (b) represent
that no Default or Event of Default has occurred and is continuing.
3.2 Incorporation of the Loan Agreement. This Third Loan Amending Agreement is
supplemental to and shall henceforth be read in conjunction with the Loan
Agreement, and the Loan Agreement and this Third Loan Amending Agreement shall
henceforth have effect so far as practicable as if all the provisions thereof
and hereof were contained in one instrument.
3.3 Reference to and Effect on the Loan Agreement. On and after the date hereof,
each reference in the Loan Agreement to "this agreement", "hereunder", "hereof",
"herein" or words of like import, and each reference to the Loan Agreement in
any and all agreements, documents and instruments delivered by all or any one or
more of the parties thereto and any other Person shall mean and refer to the
Loan Agreement as amended hereby. Except as specifically amended hereby, the
Loan Agreement shall remain in full force and effect and is hereby ratified and
confirmed.
3.4 Confirmation of Security. The Borrower hereby confirms that the Security
Documents to which it is a party continue to remain in full force and effect,
unamended, for the benefit of the Lender and continue to extend to all
liabilities of the Borrower under the Loan Agreement as amended hereby.
3.5 Confirmation of Guarantee. Cantel hereby confirms that the Letter of
Guarantee remains in full force and effect, unamended, for the benefit of the
Lender and continues to extend to all liabilities and obligations of the
Borrower under the Loan Agreement as amended hereby.
3.6 Confirmation of Postponement Agreement. Cantel hereby confirms that the
Postponement Agreement remains in full force and effect, unamended, for the
benefit of the Lender and continues to extend to all liabilities of the Borrower
under the Loan Agreement as amended hereby.
3.7 No Waiver. The execution, delivery and effectiveness of this Third Loan
Amending Agreement shall not operate as a waiver of any right, power or remedy
of the Lender under the Loan Agreement or any other agreements or instruments
delivered in connection therewith or pursuant thereto.
3.8 Expenses. The Borrower shall be obligated to reimburse the Lender for all
its reasonable costs and expenses (including without limitation, reasonable
legal expenses) incurred in connection with the preparation, execution and
delivery of this Third Loan Amending Agreement.
-8-
3.9 Governing Law. This Third Loan Amending Agreement shall be governed by and
construed in accordance with the laws of the Province of Ontario and Canada
applicable therein and shall be treated in all respects as an Ontario contract.
3.10 Assignment. Subject to the restrictions on assignment and transfer
contained in the Loan Agreement, this Third Loan Amending Agreement shall enure
to the benefit of and be binding upon the parties hereto and their respective
heirs, executors, administrators, successors and assigns.
3.11 Counterparts. This Third Loan Amending Agreement may be executed in any
number of counterparts with the same effect as if the parties hereto had all
signed the documents and each of such counterparts, when so executed, shall be
deemed to be an original and such counterparts together shall constitute one and
the same instrument, which shall be sufficiently evidenced by any such original
counterpart.
IN WITNESS WHEREOF the parties hereto have executed this Amending
Agreement as of the day and year first above written.
Per: /s/ Xxxxxx X. Xxxxx
--------------------------
Name: XXXXXX X. XXXXX
Title: CHAIRMAN, CEO AND CFO
CANTEL INDUSTRIES, INC.
Per: /s/ Xxxxx X. Xxxxxx
--------------------------
Name: Xxxxx X. Xxxxxx
Title: PRESIDENT
NATIONAL BANK OF CANADA
Per: /s/ Xxxxxxx Xxxxxx /s/ X. Xxxxxxxxx
-------------------------------------
Name: Xxxxxxx Xxxxxx X. Xxxxxxxxx
Title: Mgr Sr Mgr
