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Exhibit 4.4
WAIVER, DIRECTION AND AMENDMENT NUMBER ONE
RE:
THE XXXXX-X'XXXX COMPANY
$35,000,000 SENIOR NOTES DUE MAY 31, 2003 ISSUED UNDER THE
AMENDED AND RESTATED NOTE PURCHASE AGREEMENT DATED AS OF MARCH 30, 2001
Dated as of April 20, 2001
THE XXXXX-X'XXXX COMPANY
0000 XxXxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
To the Persons named on ANNEX 1 hereto
Ladies and Gentlemen:
Reference is made to the Senior Notes due May 31, 2003 (the "NOTES") of
The Kroll X'Xxxx Company, an Ohio corporation (together with its successors and
assigns, the "COMPANY"), in the aggregate principal amount of $35,000,000
outstanding under separate Amended and Restated Note Purchase Agreements, each
dated as of March 30, 2001 (collectively, the "NOTE AGREEMENT"), between the
Company and each of the parties listed on ANNEX 1 hereto (collectively, together
with their respective successors and assigns, the "NOTEHOLDERS"). All terms not
otherwise defined herein are used with the same meaning as set forth in the Note
Agreement. Pursuant to a Stock Purchase Agreement (the "STOCK PURCHASE
AGREEMENT") in the form attached hereto as ANNEX 2, the Company intends to
consummate a transaction (the "STOCK SALE") whereby the Company will sell, and
Bengal Acquisition Corp. will purchase the Securities (as described in the Stock
Purchase Agreement). The Company hereby requests that the Noteholders waive
certain rights under the Note Agreement and instruct the Collateral Agent to
release certain collateral, all as more particularly set forth herein.
1. WAIVER AND DIRECTION. Subject to the terms and conditions set forth
in Section 3 hereof,, and based upon information furnished by the Company to the
Noteholders, each of the undersigned Noteholders hereby (a) agrees to waive its
rights to take any action under the Note Agreement as a result of any Event of
Default resulting from the Company's failure to comply with Section 8.19 of the
Note Agreement due solely to the Stock Sale and (b) instructs the Collateral
Agent to release its Lien of the assets and stock of the corporations whose
stock is the subject of the Stock Sale contemporaneously with the closing of the
Stock Sale.
2. AMENDMENT TO INTEREST RATE.
(a) Effective April 20, 2001 the term "Note Interest Rate" in
the Note Agreement is hereby amended to read in full as follows:
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"NOTE INTEREST RATE - means, as of any date of determination,
a rate per annum equal to (a) if such date is prior to April 12, 2001,
8.56%, (b) if such date is on or after April 12, 2001 and prior to
April 20, 2001, the greater of (i) 8.56% or (ii) the Floating Rate as
of such date and (c) if such date is on or after April 20, 2001, the
greater of (i) 8.56% or (ii) the lesser of (A) the highest interest
rate allowed by applicable law on the Notes and (B) the Floating Rate
PLUS the Applicable Adjustment Margin as of such date."
(b) Effective April 20, 2001 Schedule B to the Note Agreement
is hereby amended by adding the following definition in appropriate
alphabetical order:
"APPLICABLE ADJUSTMENT MARGIN - means, as of any date of
determination, an amount equal to the product of (a) one-half of one
percent (0.50%) TIMES (b) the number of complete 30 consecutive day
periods which shall have expired since April 20, 2001 as of such date
of determination."
3. EFFECTIVENESS OF WAIVER AND DIRECTION; EFFECT UPON OTHER PROVISIONS
OF THE NOTE AGREEMENT AND THE NOTES.
(a) The waiver and direction set forth in Section 1 above is
subject to satisfaction of each of the following conditions:
(i) the full execution and the delivery of this
letter agreement by the Company and each of the Noteholders;
(ii) contemporaneously with the closing of the Stock
Sale, the Company shall prepay, pursuant to Section 6.2 of the
Note Agreement, Notes in aggregate principal amount of not
less than the greater of (A) $15,123,500 and (B) an amount
equal to 43.21% of (1) the cash portion of the purchase price
actually received at the closing by the Seller (as defined in
the Stock Purchase Agreement) under the Stock Purchase
Agreement minus (2) $3,000,000;
(iii) the execution, delivery and effectiveness of an
agreement, signed by KeyBank National Association (the
"BANK"), party to the Bank Loan Agreement, in form and
substance satisfactory to each of the Noteholders containing
(A) a waiver on behalf of the Bank, identical in substance to
the waiver set forth in Section 1 hereof, with respect to
Section 7.13 of the Bank Loan Agreement and (B) a direction to
the Collateral Agent identical in substance to the direction
set forth in Section 1 hereof;
(iv) the warranties and representations contained in
Section 4 hereof being true on and as of the date hereof;
(v) any and all shares of capital stock of Armor
Holdings, Inc. ("AHI") or any other Person received by the
Company or any of its Affiliates in connection with the Stock
Sale shall have been pledged to the Collateral Agent pursuant
to a pledge agreement in form and substance reasonably
satisfactory to
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the Noteholders and the Bank and such shares will be released
by the Collateral Agent upon sales by the Company pursuant to
the terms of the Stock Purchase and payment of the proceeds of
such sales as provided in Section 3(b)(i)(A) below; and
(vi) the closing of the Stock Sale shall have been
completed on or before the Termination Date (as such term is
defined in the Stock Purchase Agreement).
(b) The Company agrees that the waiver set forth in
Section 1(a) shall remain in effect if and so long as the Company
(i) prepays, pursuant to the provisions of Section
6.2 of the Note Agreement, the following principal amounts of
Notes:
(A) upon receipt by the Company of any
proceeds from the sale of shares of capital stock of AHI or
payments made by AHI as Tranche One Deficit or Tranche One
Excess amounts pursuant to the provisions of Section 3 of
Schedule 2.6 of the Stock Purchase Agreement, in each case
received as consideration by it in connection with the Stock
Sale, a principal amount of Notes equal to 43.21% of such
proceeds or amounts as the case may be, and
(B) within sixty (60) days of the closing of
the Stock Sale, a principal amount of Notes equal to the
difference (if a positive number) between (1) $6,481,500 and
(2) an amount equal to 43.21% of the aggregate proceeds
received by the Company from each sale of one or more shares
of such capital stock of AHI within the sixty (60) day period
immediately following the closing of the Stock Sale and paid
by the Company pursuant to clause (A) above;
(ii) On or before sixty (60) days immediately
following the closing of the Stock Sale the Company pays in
full the entire outstanding principal amount of the Notes
together with interest thereon.
(c) It is further agreed and understood that (i) the amounts
contemplated to be so paid shall be considered due and payable on each
of such dates and (ii) the failure of the Company to pay the amounts
due on the Notes as provided in clause (b) above shall constitute an
immediate Event of Default.
(d) The execution, delivery and effectiveness of this letter
agreement shall not be deemed, except as expressly provided herein, (i)
to operate as a waiver of any right, power or remedy of the Noteholders
under the Note Agreement or the Notes, nor constitute a waiver of any
provision thereunder, or (ii) to prejudice any rights which any
Noteholder now has or may have in the future under or in connection
with the Note Agreement, the Notes or any other documents referred to
therein. Except as specifically set forth above, all terms and
conditions of the Note Agreement shall remain unchanged and in full
force and effect.
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4. WARRANTIES AND REPRESENTATIONS. To induce you to enter into this
letter agreement, the Company warrants and represents, as of the date hereof, as
follows:
(a) No Default or Event of Default has occurred or is
continuing (other than the Event of Default which will be waived by the
execution, delivery and effectiveness of this letter agreement and the
agreements described in Section 3 hereof), nor does any event or
condition exist that, upon the execution, delivery and effectiveness of
this letter agreement, would constitute a Default or an Event of
Default;
(b) Except for an amendment to the interest rate in the Bank
Loan Agreement which is the same as the amendment set forth in Section
2 above, the Bank will not receive, directly or indirectly, any fee,
interest rate adjustment or other remuneration for the waiver or
direction under the agreement described in Section 3(a)(iii) hereof;
and
(c) The assets of the corporations whose stock is the subject
of the Stock Purchase Agreement are the assets (other than the Excluded
Assets) of the Company's Security Products and Services Group described
in the Company's Preliminary Proxy Statement filed September 19, 2000
with the Securities and Exchange Commission. Excluded Assets means the
assets and capital stock of Securify, Inc., O'Xxxx Xxxxx Automotive
Group, O'Gara Security Systems, X'Xxxx-Xxxx & Xxxxxxxxxx CIS and
certain other entities which have no assets or business operations.
5. PAYMENT OF FEES AND EXPENSES. In accordance with Section 13.1 of the
Note Agreement, the Company shall pay or, if paid by the Noteholders, reimburse
the Noteholders for, all out-of-pocket fees, costs and expenses paid or incurred
by any Noteholder in connection with the negotiation, preparation, drafting,
implementation, actual or proposed amendment or modification, administration and
enforcement of this letter agreement, the Note Agreement and the Notes.
6. COUNTERPARTS. This letter agreement and all acceptances hereof may
be executed simultaneously in any number of counterparts, each of which shall be
deemed an original, with the same effect as if the signatures thereto and hereto
were upon the same instrument.
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Very truly yours,
THE XXXXX-X'XXXX COMPANY
By:
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Name:
Title:
ACCEPTED AND AGREED:
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CONNECTICUT GENERAL LIFE INSURANCE COMPANY
BY: CIGNA INVESTMENTS, INC. (AUTHORIZED AGENT)
By:
------------------------------
Name:
Title:
LIFE INSURANCE COMPANY OF NORTH AMERICA
BY: CIGNA INVESTMENTS, INC. (AUTHORIZED AGENT)
By:
-------------------------------
Name:
Title:
LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK
By:
---------------------------------
Name:
Title:
[Signature Page to Waiver, Direction and Amendment Number One]
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MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
BY: XXXXX X. XXXXXX & COMPANY INC.
ITS INVESTMENT ADVISER
By:
--------------------------------
Name:
Title:
THE TRAVELERS INSURANCE COMPANY
By:
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Name:
Title:
THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA
By:
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Name:
Title:
[Signature Page to Waiver, Direction and Amendment Number One]
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ANNEX 1
NOTEHOLDERS
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Connecticut General Life Insurance Company
c/o CIGNA Investments, Inc.
000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Life Insurance Company of North America
c/o CIGNA Investments, Inc.
000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Lincoln Life & Annuity Company of New York
c/o Delaware Lincoln Investment Advisers
000 Xxxx Xxxxx Xxxxxx
Xxxx Xxxxx, XX 00000-0000
Attn: Private Placements
Massachusetts Mutual Life Insurance Company
0000 Xxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attn: Securities Investment Division
The Travelers Insurance Company
Xxx Xxxxx Xxxxxx, 0XX
Xxxxxxxx, XX 00000-2030
Attn: Investment Group-Private Placement 9PB
The Guardian Life Insurance Company of America
0 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-2616
Attn: Xxxxxx X. Xxxxxxx
Investment Department 20-D
Annex 1-1
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ANNEX 2
STOCK PURCHASE AGREEMENT
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Annex 2-1
