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EXHIBIT 10(b)
AMENDMENT XX. 0
XXXXXXXXX XX. 0, dated as of October 29, 1999 (this
"Amendment"), to the Credit Agreement, dated as of May 6, 1997, as amended by
Amendment No. 1, dated as of January 30, 1998 and as amended by Amendment No. 2,
dated as of December 23, 1998 (as amended, supplemented or otherwise modified
from time to time, the "Credit Agreement"), among TELEX COMMUNICATIONS, INC., a
Delaware corporation ("Telex" or the "Borrower"), the several banks and other
financial institutions from time to time parties thereto (the "Lenders"), XXXXXX
XXXXXXX SENIOR FUNDING, INC., as documentation agent for the Lenders (in such
capacity, the "Documentation Agent"), and THE CHASE MANHATTAN BANK, a New York
banking corporation, as administrative agent for the Lenders (in such capacity,
the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower has requested that the Administrative
Agent and the Lenders amend certain definitions and covenants contained in the
Credit Agreement; and
WHEREAS, the Administrative Agent and the Lenders are willing
to agree to the requested amendments on the terms and conditions contained
herein;
NOW, THEREFORE, the parties hereto hereby agree as follows:
Defined Terms. Terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit
Agreement.
2. Amendment to Subsection 1.1. Subsection 1.1 of the
Credit Agreement is hereby amended by (a) deleting therefrom the definition of
"Applicable Margin" and inserting in lieu thereof the following:
"Applicable Margin": The Applicable Margin for Tranche B Term
Loans shall equal (i) 3.75% per annum with respect to
Eurodollar Loans and (ii) 2.75% per annum with
respect to ABR Loans. The Applicable Margin for
Revolving Credit Loans and Tranche A Term Loans will
be adjusted on each Adjustment Date to the applicable
rate per annum set forth under the heading "ABR
Applicable Margin" or "Eurodollar Applicable Margin"
on Schedule II which corresponds to the achievement
of certain performance criteria determined from the
financial statements and compliance certificate
relating to the end of the fiscal quarter immediately
preceding such Adjustment Date; provided that in the
event that the financial statements required to be
delivered pursuant to subsection 7.1(a) or 7.1(b), as
applicable, and the related compliance certificate
required to be delivered pursuant to subsection
7.2(b), are not delivered when due, then
(a) if such financial statements and compliance certificate
are delivered after the date such financial statements and compliance
certificate were required to be delivered (without giving effect to any
applicable cure period) and the Applicable Margin increases from that
previously in effect as a result of the delivery of such financial
statements, then the Applicable Margin in respect of the Revolving
Credit Loans and Tranche A Term Loans during the period from the date
upon which such financial
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statements were required to be delivered (without giving effect to any
applicable cure period) until the date upon which they actually are
delivered shall, except as otherwise provided in clause (c) below, be
the Applicable Margin as so increased;
(b) if such financial statements and compliance certificate
are delivered after the date such financial statements and compliance
certificate were required to be delivered and the Applicable Margin
decreases from that previously in effect as a result of the delivery of
such financial statements, then such decrease in the Applicable Margin
shall not become applicable until the date upon which the financial
statements and certificate actually are delivered; and
(c) if such financial statements and compliance certificate
are not delivered prior to the expiration of the applicable cure
period, then, effective upon such expiration, for the period from the
date upon which such financial statements and compliance certificate
were required to be delivered (after the expiration of the applicable
cure period) until two Business Days following the date upon which they
actually are delivered, the Applicable Margin in respect of the Loans
shall be (i) 2.25% per annum with respect to Revolving Credit Loans and
Tranche A Term Loans which are ABR Loans and (ii) 3.25% per annum with
respect to Revolving Credit Loans and Tranche A Term Loans which are
Eurodollar Loans (it being understood that the foregoing shall not
limit the rights of the Administrative Agent and the Lenders set forth
in Section 9).
(b) deleting therefrom the definition of "Interest Payment Date" and inserting
in lieu thereof the following:
"Interest Payment Date": (a) for the period prior to December
31, 1999 (i) as to any ABR Loan, the last day of each February, May,
August and November to occur while such Loan is outstanding and, if
such ABR Loan is a Term Loan, the date of each payment of principal
thereof, (ii) as to any Eurodollar Loan having an Interest Period of
three months or less, the last day of such Interest Period, (iii) as to
any Eurodollar Loan having an Interest Period longer than three months,
(x) each day which is three months, or a whole multiple thereof, after
the first day of such Interest Period and (y) the last day of such
Interest Period or (b) for the period commencing on December 31, 1999
(i) as to any ABR Loan, the last Business Day of each month to occur
while such Loan is outstanding and (ii) as to any Eurodollar Loan (x)
the last Business Day of each month to occur while such Loan is
outstanding and (y) the last day of such Interest Period.
and (c) inserting the following new definitions:
"Consolidated Funded Senior Indebtedness" at the date of
determination thereof, all Indebtedness of the Borrower and its
consolidated Subsidiaries (other than (i) the Senior Subordinated Notes
and (ii) any Indebtedness of Foreign Subsidiaries for working capital
purposes or pursuant to Section 8.6(c)) which by its terms matures more
than one year after the date of calculation, and any such Indebtedness
maturing within one year from such date which is renewable or
extendable at the option of the obligor to a date more than one year
from such date, including, in any event, the Term Loans, the Revolving
Credit Loans and the Swing Line Loans, in each case determined on a
consolidated basis in accordance with GAAP.
"Senior Leverage Ratio": at any date of determination, the
ratio of (a) Consolidated Funded Senior Indebtedness at such date to
(b) Consolidated EBITDA for the period of one year ending on such
date."
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3. Amendment to Section 7.2. Section 7.2 of the Credit
Agreement is hereby amended by (a) deleting the word "and" at the end of
paragraph (e) thereof, (b) deleting the period at the end of paragraph (f)
thereof and inserting in lieu thereof "; and" and (c) inserting at the end of
Section 7.2 the following new paragraph:
(g) As soon as available after December 31, 1999, but in any
event not later than 45 days after December 31, 1999, a certificate
signed by a Responsible Officer of the Borrower (i) stating that, to
the best of such Responsible Officer's knowledge (based on unaudited
financial statements for the period then ended, it being understood
that the audited financial statements for the year then ended may
reflect adjustments to such unaudited financial statements), the
Borrower and its Subsidiaries during the fiscal quarter of the Borrower
ending December 31, 1999 has observed or performed all of its covenants
and other agreements, and satisfied every condition, contained in this
Agreement, any Notes or the other Loan Documents to which it is a party
to be observed, performed or satisfied by it, and that such Responsible
Officer has obtained no knowledge of any Default or Event of Default,
except, in each case, as specified in such certificate, and (ii)
setting forth the calculations required to determine (A) compliance
with all covenants set forth in subsection 8.1, and (B) compliance with
the covenant set forth in subsection 8.8.
4. Amendments to Subsection 8.1. Subsection 8.1 of the Credit
Agreement is hereby amended by (a) deleting the portion of the table set forth
at the end of paragraph (a) applicable to following periods and substituting in
place thereof the following:
September 30, 1999 $43,000,000
December 31, 1999 $46,000,000
March 31, 2000 $49,000,000
June 30, 2000 $50,000,000
September 30, 2000 $52,000,000
December 31, 2000 $54,000,000
(b) deleting the portion of the table set forth at the end of paragraph (b)
applicable to following periods and substituting in place thereof the following:
September 30, 1999 0.75 to 1
December 31, 1999 0.80 to 1
March 31, 2000 0.85 to 1
June 30, 2000 0.85 to 1
September 30, 2000 0.90 to 1
December 31, 2000 0.90 to 1
(c) deleting the portion of the table set forth at the end of paragraph (c)
applicable to following periods and substituting in place thereof the following:
September 30, 1999 8.00 to 1
December 31, 1999 7.75 to 1
March 31, 2000 7.25 to 1
June 30, 2000 7.00 to 1
September 30, 2000 6.75 to 1
December 31, 2000 6.50 to 1
(z) inserting the following paragraph (d):
(d) Maintenance of Senior Leverage Ratio. Permit, for any
period of four consecutive fiscal quarters of the Borrower ending on
the last day of any fiscal quarter of the Borrower ending on or after
September 30, 1999, the Senior Leverage Ratio of
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the Borrower on such date to be greater than 2.95 to 1.
5. Amendments to Pricing Grid Schedule II to the Credit
Agreement is hereby amended by deleting the tables included therein and
inserting in lieu thereof the following table:
Applicable Margins and Commitment Fees:
for Revolving Credit Loans, Tranche A Term Loans and Commitment Fees
------------------------------ ---------------------------- --------------------------- ----------------------------
Leverage Eurodollar Applicable ABR
Ratio Margin Applicable Margin Commitment Fee
------------------------------ ---------------------------- --------------------------- ----------------------------
> 5.50 to 1 3.25% 2.25% 0.500%
-
------------------------------ ---------------------------- --------------------------- ----------------------------
> 5.00 to 1 3.00% 2.00% 0.500%
-
------------------------------ ---------------------------- --------------------------- ---------------------------
> 4.50 to 1 2.75% 1.75% 0.500%
-
------------------------------ ---------------------------- --------------------------- ----------------------------
> 4.00 to 1 2.50% 1.50% 0.375%
-
------------------------------ ---------------------------- --------------------------- ----------------------------
> 3.50 to 1 2.25% 1.25% 0.375%
-
------------------------------ ---------------------------- --------------------------- ----------------------------
< 3.50 to 1 2.00% 1.00% 0.375%
------------------------------ ---------------------------- --------------------------- ----------------------------
Interest payable on Loans after the Amendment Effective Date
(as defined below) but for any period, or portion of any period, prior to the
Amendment Effective Date shall be paid based upon said Schedule II as in effect
prior to the Amendment Effective Date.
6. Management Fee. The Borrower represents and warrants that
GSCP has consented to not accept, at any time when for the most recently
completed period of four fiscal quarters of the Borrower, the Consolidated Fixed
Charge Coverage Ratio was less than 1:00 to 1 (after giving pro forma effect to
any borrowing for the payment of such management fees), any payment in cash for
its management fee (as more fully described in the agreement between Telex and
GSCP for the rendering of management consulting or financial advisory services
described in Section 8.10(ii) of the Credit Agreement); and the Borrower agrees
not to pay such management fee in cash at any such time; it being understood and
agreed that such management fee may be paid retroactively for all periods during
which such payments were suspended if and when for the most recently completed
period of four fiscal quarters of the Borrower, the Consolidated Fixed Charge
Coverage Ratio was greater than 1:00 to 1 (after giving pro forma effect to any
borrowing for such payment).
7. Conditions to Effectiveness. This Amendment shall become
effective on the date (the "Amendment Effective Date") on which all of the
following conditions have been satisfied or waived:
(a) Execution and Delivery. Telex, the Administrative Agent
and the Required Lenders shall have executed and delivered to the
Administrative Agent this Amendment.
(b) Amendment Fee. The Borrower has paid an amendment fee of
37.5 basis points on the sum of the Revolving Credit Commitment and
outstanding Term Loans as in effect on the Amendment Effective Date to
each Lender consenting to the Amendment, such amendment fee to be
payable to the Administrative Agent for the account of such Lender, on
the Amendment Effective Date.
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8. General.
(a) Representation and Warranties. In order to induce the
Administrative Agent and the Lenders to enter into this Amendment, the Borrower
hereby represents and warrants to the Administrative Agent and the Lenders that
the representations and warranties of the Borrower contained in the Loan
Documents are true and correct in all material respects on and as of the
Amendment Effective Date (after giving effect hereto) as if made on and as of
the Amendment Effective Date (except where such representations and warranties
expressly relate to an earlier date in which case such representations and
warranties were true and correct in all material respects as of such earlier
date); provided that all references to the "Credit Agreement" in any Loan
Document shall be and are deemed to mean the Credit Agreement as amended hereby.
(b) Affirmation of Guarantees. Each Guarantor party hereto
hereby consents to the execution, delivery and effectiveness of this Amendment
and reaffirms its obligations under the Guarantee and Collateral Agreement.
(c) Payment of Expenses. The Borrower agrees to pay or
reimburse the Administrative Agent for all its reasonable out-of-pocket costs
and expenses incurred in connection with this Amendment, any other documents
prepared in connection herewith and the transactions contemplated hereby,
including, without limitation, the reasonable fees and disbursements of counsel
to the Administrative Agent.
(d) Counterparts. This Amendment may be executed in two or
more counterparts (including by facsimile transmission), each of which shall
constitute an original, but all of which when taken together shall constitute
but one instrument.
(e) Headings. Section headings used in this Amendment are for
convenience of reference only, are not part of this Amendment and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Amendment.
(f) Continuing Effect of Loan Documents. This Amendment shall
not constitute an amendment or waiver of any other provision of the Credit
Agreement not expressly referred to herein and shall not be construed as a
waiver or consent to any further or future action on the part of the Borrower
that would require a waiver or consent of the Required Lenders or Lenders, as
the case may be, or the Administrative Agent. Except as expressly amended,
modified and supplemented hereby, the provisions of the Credit Agreement and the
other Loan Documents are and shall remain in full force and effect. The
execution and delivery of this Amendment by any Lender shall be binding upon
each of its successors and assigns (including Transferees of its commitments and
Loans in whole or in part prior to effectiveness hereof) and binding in respect
of its Revolving Credit Commitments and Term Loans including any acquired
subsequent to its execution and delivery hereof and prior to the effectiveness
hereof.
(G) GOVERNING LAW. THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective proper and duly
authorized officers as of the day and year first above written.
TELEX COMMUNICATIONS, INC.
By:
----------------------------
Title:
TELEX COMMUNICATIONS GROUP, INC.
By:
----------------------------
Title:
TELEX COMMUNICATIONS
INTERNATIONAL, LTD.
By:
----------------------------
Title:
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THE CHASE MANHATTAN BANK, as
Administrative Agent and as a
Lender
By:
-----------------------------
Title:
XXXXXX XXXXXXX SENIOR FUNDING,
INC. as Documentation Agent and
as a Lender
By:
----------------------------
Title:
BANKBOSTON, N.A.
By:
----------------------------
Title:
THE BANK OF NEW YORK
By:
----------------------------
Title:
U.S. BANK NATIONAL ASSOCIATION
By:
----------------------------
Title:
XXXXXX FINANCIAL, INC.
By:
----------------------------
Title:
0
XXX XXXX XX XXXX XXXXXX
By:
----------------------------
Title:
XXXXXXX XXXXX SENIOR FLOATING
RATE FUND, INC.
By:
----------------------------
Title:
XXXXXXX XXXXX PRIME RATE
PORTFOLIO
By: Xxxxxxx Xxxxx Asset
Management, L.P., as Investment
Advisor
By:
----------------------------
Title:
THE ING CAPITAL SENIOR SECURED
HIGH INCOME FUND, L.P.
BY: ING CAPITAL ADVISORS, INC.,
as Investment Advisor
By:
----------------------------
Title:
XXXXXX XXXXXXX XXXX XXXXXX PRIME
INCOME TRUST
By:
----------------------------
Title:
9
SENIOR DEBT PORTFOLIO
BY: BOSTON MANAGEMENT &
RESEARCH, AS INVESTMENT
ADVISOR
BY:
--------------------------
TITLE:
ML CBO IV (CAYMAN) LTD.
BY: HIGHLAND CAPITAL MANAGEMENT
L.P.
AS COLLATERAL MANAGER
BY:
--------------------------
TITLE:
NATEXIS BANQUE BFCE
BY:
--------------------------
TITLE:
XXX CAPITAL FUNDING LP
BY: HIGHLAND CAPITAL MANAGEMENT
L.P.
AS COLLATERAL MANAGER
BY:
--------------------------
TITLE:
10
CRESCENT/MACH I PARTNERS, L.P.
By: TCW ASSET MANAGEMENT COMPANY
ITS INVESTMENT MANAGER
By:
----------------------------
Title:
DEEPROCK & COMPANY
By: XXXXX XXXXX MANAGEMENT, AS
INVESTMENT ADVISOR
By:
-----------------------------
Title:
KZH-ING-1 LLC (formerly known as
KZH HOLDING CORPORATION II)
By:
----------------------------
Title:
CRESCENT MACH I
By:
----------------------------
Title:
THE TRAVELERS INSURANCE COMPANY
By:
----------------------------
Title:
11
KZH PAMCO LLC
By:
----------------------------
Title:
INDOSUEZ CAPITAL FUNDING III,
LIMITED
BY: INDOSUEZ CAPITAL, AS
PORTFOLIO ADVISOR
By:
----------------------------
Title:
PAMCO CAYMAN LTD.
BY: HIGHLAND CAPITAL MANAGEMENT
L.P.
AS COLLATERAL MANAGER
By:
----------------------------
Title:
KZH-CRESCENT LLC
By:
----------------------------
Title:
KZH-SOLEIL LLC
By:
----------------------------
Title:
