EXHIBIT 10.3
FIRST AMENDMENT TO AMENDED AND RESTATED
REVOLVING CREDIT AND SECURITY AGREEMENT
This First Amendment to Amended and Restated Revolving Credit and
Security Agreement (the "Amendment") is entered into as of the 14 day of
October, 2003 by and between SFBC INTERNATIONAL, INC., a Delaware corporation
("Borrower"), WACHOVIA BANK, NATIONAL ASSOCIATION (the "Bank"), successor in
interest to First Union National Bank, and SOUTH FLORIDA KINETICS, INC., a
Florida corporation, d/b/a SOUTH FLORIDA BIOAVAILABILITY CLINIC, SFBC FT. XXXXX,
INC., a Florida corporation, SFBC ANALYTICAL LABORATORIES, INC., a Florida
corporation, SFBC NEW DRUG SERVICES, INC., a Florida corporation, f/k/a SFBC
CHARLOTTE, INC., SFBC CANADA, INC., a Federal corporation (Canada), ANAPHARM,
INC., a provincial corporation (Quebec), DAEDAL MANAGEMENT & INVESTMENT INC., a
provincial corporation (Ontario), DANAPHARM CLINICAL RESEARCH INC., a provincial
corporation (Ontario), and SYNFINE RESEARCH INC., a provincial corporation
(Ontario) (collectively, the "Guarantor").
WITNESSETH:
WHEREAS, Borrower and Bank entered into that certain Revolving Credit
and Security Agreement dated as of September 16, 2002 (the "Agreement"); and
WHEREAS, Borrower and Bank entered into that certain Amended and
Restated Revolving Credit and Security Agreement dated as of July 30, 2003; and
WHEREAS, the parties desire to modify and amend the Agreement pursuant
to the terms hereof. Capitalized terms used herein and not otherwise defined
shall have the respective meanings assigned in the Agreement.
NOW, THEREFORE, for good and valuable considerations, the receipt of
which is hereby acknowledged, the parties do hereby modify the Agreement as
follows:
1. Section 2.1(A) of the Agreement is hereby deleted in its
entirety and the following Section 2.1(A) is hereby substituted in lieu thereof:
2.1(a). $7,000,000.00 Revolving Credit Facility. Bank agrees,
on the terms and conditions set forth in this Agreement, to make Advances and to
issue commercial and standby letters of credit on behalf of Borrower from time
to time during the Revolving Credit Period in amounts such that the aggregate
principal amount of Advances and the face amount of any letters of credit at any
one time outstanding will not exceed the lesser of (i) $7,000,000.00 or (ii) the
Borrowing Base (the "$7,000,000 Loan"). The aggregate principal amount of all
letters of credit shall not exceed $1,000,000.00. Notwithstanding the foregoing,
the aggregate amount of the Advances by Bank from time to time shall be subject
to any Reserves that Bank in its sole and absolute discretion may deem proper
and/or necessary. Within the foregoing limit, Borrower may borrow, prepay and
reborrow Advances at any time during the Revolving Credit Period for general
corporate purposes. This is a revolving credit facility for general business
purposes.
2. Section 2.1(B) of the Agreement is hereby deleted in its
entirety and the following Section 2.1(B) is hereby substituted in lieu thereof:
2.1(b) $8,000,000.00 Non-Revolving Credit Facility. Bank
agrees, on the terms and conditions set forth in this Agreement, subject to the
terms and conditions set forth in the $8,000,000 Note (as defined below), to
make Advances on behalf of Borrower from time to time in amounts such that the
aggregate principal amount of Advances at any one time outstanding will not
exceed $8,000,000.00 (the $8,000,000 Loan"). This facility is for the purpose of
financing acquisitions of companies in related industries. Borrower shall have
the right to borrow, re-pay and re-borrow (one time only) the $8,000,000.00 Loan
during the term of said Loan. Once repaid, the revolving component of the
$8,000,000 Loan may not be re-borrowed under any condition whatsoever. Borrower
may not re-borrow any portion of the $8,000,000
Loan unless Borrower has re-paid the entire outstanding balance of the Loan
prior to June 30, 2004. Notwithstanding the foregoing, for so long as Borrower
is in compliance with the terms and conditions of this Agreement and after
giving effect thereto, there shall be no Default hereunder, Borrower may use its
own funds to make one or more acquisitions.
3. Section 2.2 of the Agreement is hereby deleted in its entirety
and the following Section 2.2 is hereby substituted in lieu thereof:
2.2 Notes. The Loans shall be evidenced by (i) an Amended
and Restated Revolving Promissory Note in the face amount of $7,000,000.00 (the
"$7,000,000 Note") dated as of July 30, 2003, and (ii) an Amended and Restated
Term/Non-Revolving Promissory Note in the face amount of $8,000,000.00 (the
$8,000,000 Note") dated as of October __, 2003 (collectively, the "Notes") and
shall be payable in accordance with the terms of each respective Note and this
Agreement.
4. Section 2.6(E) of the Agreement is hereby deleted in its
entirety and the following Section 2.6(E) is hereby substituted in lieu thereof:
(e) To the extent that the aggregate amount of all
Advances and the face amount of all outstanding letters of credit exceeds the
Borrowing Base, the amount of such excess will be paid immediately to Bank upon
Bank's demand.
5. Section 2.10 of the Agreement is hereby deleted in its
entirety and the following Section 2.10 is hereby substituted in lieu thereof:
2.10. Letters of Credit.
(a) At its discretion Bank may from time to time issue,
extend or renew letters of credit and for the account of Borrower or its
Subsidiaries up to an aggregate maximum amount of $1,000,000.00. The
availability of Advances under the $7,000,000.00 Loan shall be reduced by
outstanding obligations of Bank under any letters of credit. All payments made
by Bank under any such letters of credit (whether or not Borrower is the account
party or drawer) and all fees, commissions, discounts and other amounts owed or
to be owed to Bank in connection therewith shall be deemed to be Advances under
the $7,000,000 Note, shall be secured by the Collateral, and shall be repaid on
demand. Borrower shall complete and sign such applications and supplemental
agreements and provide such other documentation as Bank may require. The form
and substance of all letters of credit shall be subject to Bank's approval. All
letters of credit shall have a term not to exceed one year, and shall have an
expiration date of not later than 90 days beyond the Termination Date. Bank may
charge a fee or commission for issuance, renewal or extension of a letter of
credit. Borrower unconditionally guarantees all obligations of any Subsidiary
with respect to letters of credit issued by Bank for the account of such
Subsidiary. Upon a Default, Borrower shall, on demand, deliver to Bank good
funds equal to 105% of Bank's maximum liability under all outstanding letters of
credit, to be held as cash Collateral for Borrower's reimbursement obligations
and other Indebtedness.
(b) Any letter of credit issued hereunder shall be
governed, as applicable, by the Uniform Customs and Practice for Documentary
Credits, International Chamber of Commerce ("ICC") Publication 500 or any
subsequent revision or restatement thereof adopted by the ICC and in use by Bank
or the International Standby Practices, ICC Publication No. 590 or any
subsequent revision or restatement thereof adopted by the ICC and in use by
Bank, except to the extent that the terms of such publication would limit or
diminish rights granted to Bank hereunder or in any other Loan Document.
6. Section 2.11 of the Agreement is hereby deleted in its
entirety and the following Section 2.11 is hereby substituted in lieu thereof:
2.11. Fees. Borrower shall pay to Bank: (i) a one-time
non-refundable facility fee in the amount of $25,000.00, prior to the closing of
the Loan; (ii) annually during the term of the $7,000,000 Note, an annual
non-refundable facility fee equal to 25 basis points on the difference between
the
average usage and the average availability supported by the Borrowing Base;
(iii) during the term of the $8,000,000 Note, a non-refundable non-use fee equal
to 50 basis points of the average un-used portion for such previous year as
determined on each fiscal year end of Borrower and on the Termination Date; and
(iv) at such times as Bank shall require, Bank's standard fees in connection
with letters of credit, as in effect from time to time, and with respect to
standby letters of credit, at the time of issuance of each standby letter of
credit, a fee equal to 1.25% per annum on the face amount of the standby letter
of credit for the period of time the standby letter of credit will be
outstanding.
7. Except as hereby amended and modified, the terms of the Loan
Agreement shall remain in full force and effect.
8. Borrower acknowledges, represents, warrants and confirms to
Bank that: (i) the Notes, the Agreement and the other Loan Documents, as amended
or modified to date, are valid and binding upon Borrower and enforceable in
accordance with the respective terms thereof; (ii) all of the terms, covenants,
conditions, representations, warranties and agreements contained in the Loan
Documents are hereby ratified and confirmed in all respects; (iii) there are no
defenses, setoffs, counterclaims, cross-actions or equities in favor of Borrower
to or against the enforcement of the Notes, the Agreement or the other Loan
Documents; (iii) no oral representations, statements, or inducements have been
made by Bank with respect to the Loan, this Amendment or any Loan Document; and
(iv) Bank is under no obligation to further amend or modify the Agreement or any
other Loan Document.
9. Each Guarantor acknowledges, represents, warrants and confirms
to Bank that: (i) each respective Guaranty Agreement and all other documents
executed by each Guarantor in connection therewith are valid and binding
obligations of each Guarantor, enforceable in accordance with their respective
terms; (ii) the Loan, as evidenced by the Notes and other Loan Documents, shall
continue to be guarantied by each Guaranty Agreement; (iii) all of the terms,
covenants, conditions, representations, warranties and agreements contained in
each Guaranty Agreement are hereby ratified and confirmed in all respects; (iv)
there are no defenses, setoffs, counterclaims, cross-actions or equities in
favor of any Guarantor to or against the enforcement of any Guaranty Agreement
or any of the other Loan Documents; (v) no oral representations, statements, or
inducements have been made by Bank with respect to the Loan, this Agreement or
any Guaranty Agreement; and (vi) Bank is under no obligation to further amend or
modify the Agreement or any other Loan Document.
10. The Agreement, the Guaranty Agreements and all other Loan
Documents, and all other documents executed in connection with any of the
foregoing, are hereby ratified, confirmed and approved in all respects
including, but not limited to, the representations and warranties contained
therein, and Borrower and Guarantor do each hereby represent and warrant that no
default now exists.
11. Except as amended by this Agreement, no term or condition of
the Agreement or any other Loan Document shall be modified and the same shall
remain in full force and effect; provided, however, if any provision of this
Agreement is in conflict with, or inconsistent with, any provision in the
Agreement (as amended) or other Loan Documents, then the provision contained in
this Agreement shall govern and control.
12. AS A MATERIAL INDUCEMENT FOR BANK TO EXECUTE THIS AGREEMENT,
BORROWER AND EACH GUARANTOR DO EACH HEREBY RELEASE, WAIVE, DISCHARGE, COVENANT
NOT TO XXX, ACQUIT, SATISFY AND FOREVER DISCHARGE BANK, ITS RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, AND AGENTS AND ITS AFFILIATES AND ASSIGNS FROM ANY AND ALL
LIABILITY, CLAIMS, COUNTERCLAIMS, DEFENSES, ACTIONS, CAUSES OF ACTION, SUITS,
CONTROVERSIES, AGREEMENTS, PROMISES AND DEMANDS WHATSOEVER IN LAW OR IN EQUITY
WHICH THE BORROWER AND/OR ANY GUARANTOR EVER HAD, NOW HAS, OR WHICH ANY PERSONAL
REPRESENTATIVE, SUCCESSOR, HEIR OR ASSIGN OF BORROWER AND/OR ANY GUARANTOR
HEREAFTER CAN, SHALL OR MAY HAVE AGAINST BANK, ITS RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, AND AGENTS, AND ITS AFFILIATES AND ASSIGNS, FOR, UPON OR
BY REASON OF ANY MATTER, CAUSE OR THING WHATSOEVER THROUGH THE DATE THAT THIS
AGREEMENT IS EXECUTED. BORROWER AND EACH
GUARANTOR FURTHER EXPRESSLY AGREE THAT THE FOREGOING RELEASE AND WAIVER
AGREEMENT IS INTENDED TO BE AS BROAD AND INCLUSIVE AS PERMITTED BY THE LAWS OF
THE STATE OF FLORIDA. IN ADDITION TO, AND WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, AND IN CONSIDERATION OF BANK'S EXECUTION OF THIS AGREEMENT, BORROWER
AND EACH GUARANTOR COVENANT WITH AND WARRANT UNTO BANK, AND ITS RESPECTIVE
AFFILIATES AND ASSIGNS, THAT THERE EXIST NO CLAIMS, COUNTERCLAIMS, DEFENSES,
OBJECTIONS, OFFSETS OR CLAIMS OF OFFSETS AGAINST BANK OR THE OBLIGATIONS OF
BORROWER AND EACH GUARANTOR TO PAY ANY OBLIGATIONS TO BANK WHEN AND AS THE SAME
BECOMES DUE AND PAYABLE.
13. The Loan Documents constitute the entire understanding and
agreement among Borrower, Guarantor, and Bank with respect to the transactions
arising in connection with the Loan, and supersede all prior written or oral
understandings and agreements among Borrower, Guarantor, and Bank with respect
to the matters addressed in the Loan Documents.
14. Binding Arbitration; Preservation of Remedies.
(a) Binding Arbitration. Upon demand of any party hereto,
whether made before or after institution of any judicial proceeding, any claim
or controversy arising out of, or relating to the Loan Documents ("Disputes")
between the parties hereto (a "Dispute") shall be resolved by binding
arbitration conducted under and governed by the Commercial Financial Disputes
Arbitration Rules (the "Arbitration Rules") of the American Arbitration
Association (the "AAA") and the Federal Arbitration Act in Miami, FL. Disputes
may include, without limitation, tort claims, counterclaims, disputes as to
whether a matter is subject to arbitration, claims brought as class actions, or
claims arising from documents executed in the future. A judgment upon the award
may be entered in any court having jurisdiction. Notwithstanding the foregoing,
this arbitration provision does not apply to disputes under or related to swap
agreements.
(b) Special Rules. All arbitration hearings shall be
conducted in the city in which the office of Bank first stated above is located.
A hearing shall begin within 90 days of demand for arbitration and all hearings
shall be concluded within 120 days of demand for arbitration. These time
limitations may not be extended unless a party shows cause for extension and
then for no more than a total of 60 days. The expedited procedures set forth in
Rule 51 et seq. of the Arbitration Rules shall be applicable to claims of less
than $1,000,000. Arbitrators shall be licensed attorneys selected from the
Commercial Financial Dispute Arbitration Panel of the AAA. The parties do not
waive applicable Federal or state substantive law except as provided herein.
(c) Preservation and Limitation of Remedies.
Notwithstanding the preceding binding arbitration provisions, the parties agree
to preserve, without diminution, certain remedies that any party may exercise
before or after an arbitration proceeding is brought. The parties shall have the
right to proceed in any court of proper jurisdiction or by self-help to exercise
or prosecute the following remedies, as applicable: (i) all rights to foreclose
against any real or personal property or other security by exercising a power of
sale or under applicable law by judicial foreclosure including a proceeding to
confirm the sale; (ii) all rights of self-help including peaceful occupation of
real property and collection of rents, set-off, and peaceful possession of
personal property; (iii) obtaining provisional or ancillary remedies including
injunctive relief, sequestration, garnishment, attachment, appointment of
receiver and filing an involuntary bankruptcy proceeding; and (iv) when
applicable, a judgment by confession of judgment. Any claim or controversy with
regard to the parties' entitlement to such remedies is a Dispute.
(d) No Punitive Damages. Each party agrees that it shall
not have a remedy of punitive or exemplary damages against the other in any
Dispute and hereby waives any right or claim to punitive or exemplary damages it
may have now or which may arise in the future in connection with any Dispute,
whether the Dispute is resolved by arbitration or judicially.
(e) Waiver of Jury Trial. The parties acknowledge that by
agreeing to binding arbitration they have irrevocably waived any right they may
have to a jury trial with regard to a Dispute.
THIS FIRST AMENDMENT TO AMENDED AND RESTATED REVOLVING CREDIT AND
SECURITY AGREEMENT IS EXECUTED AND DELIVERED UNDER SEAL AS OF OCTOBER 14, 2003.
BORROWER:
SFBC INTERNATIONAL, INC., a Delaware corporation
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
GUARANTOR:
SOUTH FLORIDA KINETICS, INC., a Florida corporation,
d/b/a SOUTH FLORIDA BIOAVAILABILITY CLINIC
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
SFBC FT. XXXXX, INC., a Florida corporation
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
SFBC ANALYTICAL LABORATORIES, INC., a Florida corporation
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
SFBC NEW DRUG SERVICES, INC., a Florida corporation,
f/k/a SFBC CHARLOTTE, INC.
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
SFBC CANADA, INC., a Federal corporation (Canada)
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
ANAPHARM, INC., a provincial corporation (Quebec)
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
SYNFINE RESEARCH INC., a provincial corporation (Ontario)
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
DAEDAL MANAGEMENT & INVESTMENT INC.,
a provincial corporation (Ontario)
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
DANAPHARM CLINICAL RESEARCH INC.,
a provincial corporation (Ontario)
By: /s/ Xxxxxx Xxxxxxx
------------------------------------------------
Xxxxxx Xxxxxxx, Assistant Secretary
BANK:
WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxxxxx (SEAL)
------------------------------------------
Xxxxxx X. Xxxxxxxx, Senior Vice President
Sworn to and subscribed before me this ___ day of October, 2003. I certify that:
(a) I am the duly authorized and licensed captain of the Vessel described above;
and (b) the Vessel was outside the territorial limits of the State of Florida at
a longitude of _____________ and a latitude of _____________ at the time of the
execution and delivery of this Note.
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Captain of Vessel
Print Name:
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License Number:
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