Exhibit 10.173
SECOND AMENDMENT
TO AND REAFFIRMATION OF
SUBORDINATION AND INTERCREDITOR AGREEMENT
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THIS SECOND AMENDMENT TO AND REAFFIRMATION OF SUBORDINATION AND
INTERCREDITOR AGREEMENT (this "Amendment") is made effective as of the 30th day
of June, 2001 by APPLIED BIOSCIENCE INTERNATIONAL INC., a Delaware corporation
("ABI"), PPD UK HOLDINGS LIMITED, a private company incorporated in England and
Wales (collectively, the "Subordinate Creditors"), ENVIRON HOLDINGS, INC., a
Delaware corporation ("EHI"), ENVIRON INTERNATIONAL CORPORATION (formerly known
as APBI Environmental Sciences Group, Inc.), a Virginia corporation ("EIC") and
ENVIRON FACILITY SERVICES CORPORATION, a Virginia corporation ("EFSC", together
with EHI and EIC, collectively, the "Borrowers"), and FIRST UNION NATIONAL BANK,
a national banking association, its successors and assigns (the "Bank").
RECITALS
WHEREAS, the Bank has previously agreed, inter alia, to make a certain
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term loan to EHI and EIC in the maximum outstanding principal amount of
$6,708,333.34 and a revolving credit loan to EHI and EIC in the maximum
outstanding principal amount of $3,500,000 pursuant to that certain Credit and
Security Agreement by and among EHI, EIC and the Bank dated March 30, 1999 as
amended by that certain First Amendment to Credit and Security Agreement dated
November __, 1999, that certain Second Amendment to Credit and Security
Agreement dated October 17, 2000 and that certain Third Amendment to Credit and
Security Agreement (the "FUNB Third Amendment") of even date herewith (as
hereafter amended, restated, modified or renewed from time to time, the "FUNB
Credit Agreement"); and
WHEREAS, ABI has previously agreed, inter alia, to make a certain
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acquisition loan to EHI and EIC in the original principal amount of $18,000,000
pursuant to a Credit and Security Agreement by and among ABI, EHI and EIC dated
February 2, 1999, as amended by that certain Amendment No. 1 to Credit and
Security Agreement dated March 30, 1999, that certain Amendment No. 2 and
Restatement of Credit and Security Agreement dated November 24, 1999, that
certain Amendment No. 3 to Credit and Security Agreement dated October 17, 2000
and that certain Amendment No. 4 to Credit and Security Agreement (the "ABI
Fourth Amendment") of even date herewith (as hereafter amended, restated,
modified or renewed from time to time, the "ABI Credit Agreement"); and
WHEREAS, the Borrowers' obligations under the FUNB Credit Agreement and
the other Credit Documents (as such term is defined in the FUNB Credit
Agreement, the "FUNB Credit Documents") are guaranteed by Environ UK Limited,
formerly Environmental Assessment Group Limited, a company limited by shares
organized under the laws of England and Wales ("EAGL") pursuant to the terms of
that certain Unconditional Guaranty dated November 24, 1999 (as thereafter
amended, modified and renewed from time to time, the "FUNB Guaranty"), and
secured by, among other things, that certain Mortgage Debenture from EAGL in
favor of the Bank dated November 24, 1999 (as thereafter amended, modified and
renewed from time to time, the "FUNB Mortgage Debenture"). The Borrowers'
obligations under the FUNB Credit
Agreement and the other FUNB Credit Documents are also secured, by among other
things, that certain Pledge Agreement from EHI in favor of the Bank dated March
30, 1999, pursuant to which EHI pledged to the Bank all of the outstanding stock
of EAGL (as thereafter amended, modified and renewed from time to time, the
"FUNB U.K. Pledge Agreement"); and
WHEREAS, the Borrowers' obligations under the ABI Credit Agreement and
the other Credit Documents (as such term is defined in the ABI Credit Agreement,
the "ABI Credit Documents") are guaranteed by EAGL pursuant to the terms of that
certain Unconditional Guaranty dated November 24, 1999 (as thereafter amended,
modified and renewed from time to time, the "ABI Guaranty"), and secured by,
among other things, that certain Mortgage Debenture from EAGL in favor of ABI
dated November 24, 1999 (as thereafter amended, modified and renewed from time
to time, the "ABI Mortgage Debenture"). The Borrowers' obligations under the ABI
Credit Agreement and the other ABI Credit Documents are also secured, by among
other things, that certain Pledge Agreement from EHI in favor of ABI dated March
30, 1999, pursuant to which EHI pledged to ABI all of the outstanding stock of
EAGL, subject to the terms of the FUNB U.K. Pledge Agreement (as thereafter
amended, modified and renewed from time to time, the "ABI U.K. Pledge
Agreement"); and
WHEREAS, in order to avoid certain potential adverse tax consequences,
the Borrowers have requested that the Bank and the Subordinate Creditors (i)
release EAGL as a guarantor under the FUNB Guaranty and the ABI Guaranty, (ii)
release the Bank's and ABI's respective lien on any Collateral owned by EAGL and
created pursuant to the FUNB Mortgage Debenture and the ABI Mortgage Debenture,
and (iii) reduce the percentage of EAGL's outstanding stock pledged to the Bank
pursuant to the FUNB U.K. Pledge Agreement and pledged to ABI pursuant to the
ABI U.K. Pledge Agreement, in each case, from one hundred percent (100%) to
sixty-six percent (66%) (collectively, the "EAGL Release"); and
WHEREAS, EHI has entered into that certain Share Purchase Agreement
dated as of June 29, 2001 (the "EFSC Stock Purchase Agreement") with Energy
Facility Services, Inc., a Texas corporation ("EFSI") to sell to EFSI all of the
outstanding shares of its subsidiary Environ Facility Services Corporation, a
Virginia corporation ("EFSC") (the "EFSC Sale") and has requested in connection
with the EFSC Sale that the Bank and the Subordinate Creditors (i) consent to
the EFSC Sale, (ii) release EFSC as a Borrower under the FUNB Credit Agreement,
the ABI Credit Agreement and all of the other FUNB Credit Documents and ABI
Credit Documents and release EFSC from any and all further liability under the
FUNB Credit Documents and under the ABI Credit Documents (iii) consent to the
accelerated payment of the purchase price in connection with the repurchase of
875 shares of Class A common stock and 1 share of Class B common stock of EHI
owned by Xxxxxxx Xxxxx in accordance with the Shareholders' Agreement effective
as of February 1, 1999 among EHI and its shareholders, and (iv) release the
Bank's and the Subordinate Creditors' respective liens on any Collateral owned
by EFSC and created pursuant to the FUNB Credit Agreement, the ABI Credit
Agreement or any other FUNB Credit Document or ABI Credit Document
(collectively, the "EFSC Release"); and
WHEREAS, in connection with the execution of the FUNB Credit Agreement,
the Subordinate Creditors, EHI, EIC and the Bank entered into that certain
Subordination and Intercreditor Agreement dated as of March 30, 1999, as amended
by that certain First
Amendment to and Reaffirmation of Subordination and Intercreditor Agreement
dated as of October 17, 2000 (collectively, the "Agreement"); and
WHEREAS, the Bank is not willing to consent to the EAGL Release or the
EFSC Release or enter into the FUNB Third Amendment unless the Subordinate
Creditors and the Borrowers each unconditionally reaffirm their obligations
under the Agreement as modified below and consent to such amendments; and
WHEREAS, the Subordinate Creditors are not willing to consent to the
EAGL Release or the EFSC Release or enter into the ABI Fourth Amendment unless
the Bank and the Borrowers each unconditionally reaffirm their obligations under
the Agreement as modified below and consent to such amendments.
AGREEMENT
NOW THEREFORE, as an inducement for the Bank and the Subordinate
Creditors to consent to the EAGL Release, the EFSC Release, for the Bank to
enter into the Fourth Amendment, for ABI to enter into the ABI Fourth Amendment,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties do hereby agree as follows:
1. Capitalized terms used herein and not otherwise defined shall have
the meanings ascribed to them in the Agreement.
2. The Recitals set forth hereinabove are hereby incorporated by this
reference with the same force and effect as it fully set forth herein.
3. The parties hereto each acknowledge and agree that from and after
the effective date hereof (a) the term "Borrower" and "Borrowers" as used in the
Agreement shall not include EFSC, (b) the definitions of the terms "Bank Credit
Agreement," "Level 1 Senior Creditor Loan Documents" and "Senior Creditor Loan
Documents" set forth in the Agreement include the FUNB Third Amendment, a copy
or original of which has been received, reviewed and consented to by the
Subordinate Creditors and the Borrowers, (c) the definition of the term
"Subordinate Creditor Loan Documents" as set forth in the Agreement includes the
ABI Fourth Amendment, a copy or original of which has been received, reviewed
and consented to by the Bank and the Borrowers and (d) each party hereto
consents to the EAGL Release and the EFSC Release.
4. Each of the Subordinate Creditors and each of the Borrowers hereby
unconditionally reaffirm all of their respective obligations to Bank under the
Agreement.
5. The Borrowers each certify that each of the Borrowers has no
offsets, counterclaims or defenses to any of its obligations under the Agreement
as modified hereby.
6. The Bank and each of the Borrowers hereby unconditionally reaffirm
all of their respective obligations to the Subordinate Creditors under the
Agreement.
7. From and after the effective date hereof, Schedule 2.01 and
Schedule 2.02 of the Agreement are hereby replaced in their entirety with
Schedule 2.01 and Schedule 2.02 attached hereto.
8. The Bank and the Subordinate Creditors each certify that the
representations and warranties contained in the Agreement and made by it or
them, respectively, remain true, correct and complete in all material respects
as of the date hereof with the same force and effect as if made on the date
hereof.
9. Except as modified hereby, the Agreement remains unmodified and in
full force and effect.
10. This Amendment may be executed in any number of duplicate
originals or counterparts, each of which duplicate original or counterpart shall
be deemed to be an original and all taken together shall constitute one and the
same instrument.
[Signatures follow on the next page]
IN WITNESS WHEREOF, the undersigned have executed and delivered this
Amendment as of the day and year first hereinabove written.
WITNESS: BANK:
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FIRST UNION NATIONAL BANK
____________________________ By: /s/ Xxxxxx Xxxxxx (SEAL)
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Name: Xxxxxx Xxxxxx
Title: Vice President
SUBORDINATE CREDITORS:
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APPLIED BIOSCIENCE
INTERNATIONAL INC.
/s/ B. Xxxx Xxxxxxx By: /s/ Xxxx X. Xxxxxxxxx, Xx. (SEAL)
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Name: Xxxx X. Xxxxxxxxx, Xx.
Title: Vice President
PPD UK HOLDINGS LIMITED
/s/ B. Xxxx Xxxxxxx By: /s/ Xxxx X. Xxxxxxxxx, Xx. (SEAL)
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Name: Xxxx X. Xxxxxxxxx, Xx.
Title: Director
Each Borrower signs this Agreement under seal at the requests of Senior
Creditor and Subordinate Creditors, to acknowledge that each Borrower consents
to the terms of the foregoing Amendment and covenants and agrees to be bound
thereby for the benefit of Senior Creditor and Subordinate Creditors.
ENVIRON HOLDINGS, INC.
____________________________ By: /s/ Xxx X. Xxxxx (SEAL)
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Name: Xxx X. Xxxxx
Title: Chief Financial Officer
ENVIRON INTERNATIONAL
CORPORATION
____________________________ By: /s/ Xxx X. Xxxxx (SEAL)
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Name: Xxx X. Xxxxx
Title: Chief Financial Officer
ENVIRON FACILITY SERVICES
CORPORATION
____________________________ By: /s/ Xxx X. Xxxxx (SEAL)
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Name: Xxx X. Xxxxx
Title: Chief Financial Officer
