EXHIBIT 10.30
AMENDMENT
AMENDMENT, dated as of December 20, 1996 (this "Amendment"), to the Credit
Agreement, dated as of August 27, 1996 (as heretofore amended and as the same
may be further amended, supplemented or otherwise modified from time to tone,
the "Credit Agreement"), among RECOTON CORPORATION, a New York corporation (the
"Borrower"), the several banks and other financial institutions from time to
time parties thereto (the "Lenders") and THE CHASE MANHATTAN BANK, a New York
banking corporation, as administrative agent (in such capacity, the
"Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders and the Administrative Agent are parties
to the Credit Agreement; and
WHEREAS, the Borrower has requested that the Lenders and the Administrative
Agent agree to amend certain provisions of the Credit Agreement, and the Venders
and the Administrative Agent have agreed to such amendments upon the terms and
subject to the conditions set forth herein;
NOW THEREFORE, in consideration of the premises herein contained and for
other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto hereby agree as follows:
1. DEFINED TERMS. Unless otherwise defined herein, capitalized terms used
herein which are defined in the Credit Agreement, are used herein as therein
defined.
2. AMENDMENT TO SUBSECTION 1.1 Subsection 1.1 of the Credit Agreement is
hereby amended by (a) adding thereto the following new defined term in the
appropriate alphabetical order:
"'150-DAY DATE': the date that is 150 days after the
Closing Date (or, if such Date is not a Business Day, the
next succeeding Business Day).";
(b) deleting the reference to "subsection 2.4(e)" from the
definition of "Applicable Margin" and substituting in lieu
thereof the reference "subsection 2.4(f)";
(c) deleting the reference to "subsection 2.1(e)" from the
definition of "Commitment Fee Rate" and substituting in lieu
thereof the reference "subsection 2.4(f)";
(d) deleting the reference to "subsection ~.4(e)." at the end of the
definition of "FUNDED INDEBTEDNESS" and substituting in lieu thereof the
reference "subsection 2.4(f), PROVIDED, however, that if the matters described
in subsection 2.1(b) shall occur on or before the 150-Day Date, as a result of
the incurrence of Indebtedness permitted by subsection 7.2(g), such Indebtedness
shall be deemed, for purposes of calculating the Leverage Ratio, to have been
outstanding on December 31, 1996."
3. AMENDMENT TO SUBSECTION 2.1. Subsection 2.1(b) of the Credit Agreement
is hereby amended by (a) deleting the phrase "120-Day Date" from said subsection
and substituting in lieu thereof the phrase "150-Day Date";
(b) deleting the amount "$50,000,000" wherever it appears
in So id subsection and substituting in lieu thereof the amount
"$65,000,000"; and
(c) deleting the period at the end of the first sentence of said
subsection and substituting in lieu thereof the phrase "under 'Subsequent
Commitments - $15mm Term Loan."'
4. AMENDMENT TO SUBSECTION 2.4. Subsection 2.4 of the Credit Agreement is
hereby amended by deleting such subsection in its entirety and substituting in
lieu thereof the following new subsection 2.4:
"2.4 TERMINATION OR REDUCTION OF COMMITMENTS; MANDATORY PREPAYMENTS. (a)
The Borrower shall have the right, upon not less than five Business Days' notice
to the Administrative Agent, to terminate the Commitments or, from time to time,
to reduce the amount of the Commitments PROVIDED that no such termination or
reduction shall be permitted if, after giving effect thereto and to any
prepayments of the Revolving Credit Loans made on the effective date thereof,
the Aggregate Outstanding Extensions of Credit would exceed the Commitments then
in effect. Any such reduction shall be in an amount equal to S1,000,000 or a
whole multiple thereof and shall reduce permanently the Commitments then in
effect. Termination of the Commitments shall also terminate the obligation of
the Lenders to make the Term Loans.
(b) On each Receipt of Proceeds Date that occurs on or before the 150-Day
Date, the Revolving Credit Loans shall be prepaid, and the Commitments shall be
reduced, by an amount equal to the net cash proceeds of the incurrence of the
related Indebtedness, PROVIDED, HOWEVER, that in no event shall the Commitments
be reduced to less than $65,000,000 pursuant to this paragraph.
(c) On the 150-Day Date (if the matters described in subsection 2.1(b)
shall not have occurred prior to such 150-Day Date) (i) the Commitments shall be
automatically reduced to an amount equal to 550,000,000, (ii) that portion of
any then outstanding Revolving Credit Loans that, when added to the aggregate
amount of LIC Obligations then outstanding, exceeds $110,000,000 shall be
prepaid, and (iii) that portion of any then outstanding Revolving Credit Loans
remaining after giving effect to clause (ii) above that does not exceed
S60,000.000 shall be converted to Term Loans in accordance with subsection 2.5.
(d) On the date upon which the matters described in subsection 2.1(b) shall
occur (i) the Commitments shall be automatically reduced to an amount equal to
$50,000,000 and (ii) that portion of any then outstanding Revolving Credit Loans
that does not exceed $15,000,000 shall be converted to Term Loans in accordance
with subsection 2.5.
(e) On each Receipt of Proceeds Date that occurs while any Term Loans are
outstanding in accordance with the provisions of subsection 2.4(c), such Term
Loans shall be prepaid by an amount equal to the net cash proceeds of the
incurrence of the related Indebtedness. Each such prepayment shall be applied to
the installments of principal of such Term Loans in the inverse order of their
stated maturity.
(f) The Borrower shall, without notice or demand, prepay the Revolving
Credit Loans, together with interest accrued to the date of such payment or
prepayment and any amounts payable under subsection 2.17 and/or repay
Reimbursement Obligations to the extent necessary so that the Aggregate
Outstanding Extensions of Credit (other than in respect of (A) the undrawn
portion of any Letters of Credit or (B) any Term Loans) with respect to all
Lenders is equal to zero for at least one consecutive thirty day period during
each period of twelve consecutive calendar months.
(g) Each prepayment of the Loans pursuant to paragraphs (b) and (e) of this
subsection shall be accompanied by payment of all accrued and unpaid interest on
the amount prepaid and any amounts payable pursuant to subsection 2.18."
5. AMENDMENT TO SUBSECTION 2.5. Subsection 2.5 of the Credit Agreement is
hereby amended by deleting said subsection in its entirety and substituting in
lieu thereof the following new subsection:
"2.5 TERM LOANS. Subject to the terms and conditions hereof, each Lender
severally agrees to make a term loan (a "Term Loan") to the Borrower (a) on the
150 Day Date pursuant to a conversion in accordance with subsection 2.4(c) of
Revolving Credit Loans to Term Loans in an amount equal to such Lender's pro
rata share (based upon the respective amounts of the Term Loans of each Lender
specified in Schedule II hereto under "Subsequent Commitments - $60 mm Term
Loan") of the amount provided for in such subsection to be so converted or (b)
on the date upon which the matters described in subsection 2.1(b) shall occur
pursuant to a conversion in accordance with subsection 2.4(d) of Revolving
Credit Loans to Term Loans in an amount equal to such Lender's pro rata share
(based upon the respective amounts of the Term Loans of each Lender specified in
Schedule II hereto under "Subsequent Commitments - $15 mm Term Loan") of the
amount provided for in such subsection to be so converted. The Term Loans may
from time to time be (a) Eurodollar Loans, (b) ABR Loans or (c) a combination
thereof, as determined by the Borrower and notified to the Administrative Agent
in accordance with subsections 2.2 and 2.8."
6. AMENDMENT TO SUBSECTION 7.9. (a) Subsection 7.2 of the Credit Agreement
is hereby amended by (a) deleting the reference to "subsection 2.4(d)" from
subsection 7.2(g) and substituting in lieu thereof the reference "subsection
2.4(e)";
(b) deleting the word "and" from the end of subsection 7.X(g);
(c) deleting the period at the end of subsection 7.2(h); and
(d) adding thereto the following new subsection:
"; and (i) Indebtedness of the Borrower and/or any of its Subsidiaries
pursuant to letter of credit financing with respect to Hong Kong operations;
PROVIDED that (i) no such letters of credit shall have a tenor of more than 120
days and (ii) the aggregate undrawn face amount of all such letters of credit
shall not at any time exceed the equivalent of US$2,500,000."
7. AMENDMENT TO SUBSECTION 7.4. Subsection 7.4 of the Credit Agreement is
hereby amended by (a) deleting the word "and" from the end of Subsection 7.4(c);
(b) deleting the period from the end of subsection 7.4(d); and
(c) adding thereto the following new subsection:
"; and (e) Guarantee Obligations of the Borrower and/or any of its
Subsidiaries pursuant to guarantees given in connection with letter of credit or
trust receipts financing with respect to Hong Kong OPERATIONS; PROVIDED that (i)
no such letters of credit shall have a tenor of more than 120 days and (ii) the
aggregate undrawn face amount of all such letters of credit and trust receipts
shall not at any time exceed the equivalent of US$2,500,000."
8. AMENDMENT TO SCHEDULES I. II AND III. Schedules I, II and III to the
Credit Agreement are hereby amended by deleting the same in their entireties and
substituting in lieu thereof Schedules I, II and II attached hereto; PROVIDED,
however, that in no event will Schedule I attached hereto become effective prior
to December 30, 1996.
9. EFFECTIVENESS. This Amendment shall become effective (the date upon
which this Amendment shall become effective being herein called the "EFFECTIVE
DATE") on the condition that (a) the Borrower shall have delivered to the
Administrative Agent duly executed copies of this Amendment, which copies shall
include the acknowledgement and consent of the Guarantors, (b) the
Administrative Agent shall have received duly executed copies of this Amendment
from each Lender, (c) the Borrower shall have delivered to the Agent on behalf
of each Lender a duly executed Revolving Credit Note in substantially the form
of Exhibit A to the Credit Agreement in an amount equal to such Lender's amended
Commitment (each Lender hereby agreeing to return to the Borrower as soon as
practicable thereafter such Lender's original Revolving Credit Noted, (d) the
Administrative Agent shall have received, with a counterpart for each Lender, a
copy of the resolutions, in form and substance satisfactory to the
Administrative Agent. of the Board of Directors of the Borrower authorizing the
execution, delivery and performance of this Amendment, certified by the
Secretary or an Assistant Secretary of the Borrower as of the Effective r)ate,
which certificate shall be in form and substance satisfactory to the
Administrative Agent and shall state that the resolutions thereby certified have
not been amended, modified, revoked or rescinded, (e) the Administrative Agent
shall have received, with a counterpart for each Lender, a certificate of the
Borrower, dated the Effective Date, as to the incumbency and signature of the
officers of the Borrower executing this Amendment satisfactory in form and
substance to the Administrative Agent, executed by the President or any Vice
President and the Secretary or any Assistant Secretary of the Borrower, (f) the
Administrative Agent shall have received on or before December 20, 1996 the
Amendment Fee provided for in the Fee Letter Amendment, dated December 20, 1996,
between the Borrower and The Chase Manhattan Bank, and (g) the Administrative
Agent shall have received, with a counterpart for each Lender, the executed
legal opinion of Stroock & Stroock & Xxxxx LLP, counsel to the Borrower and the
other Loan Parties, in form and substance satisfactory to the Administrative
Agent.
10. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents and
warrants that the representations and warranties contained in the Credit
Agreement (except those which expressly speak as of a certain date) will be,
after giving effect to this Amendment, true and correct in all material
respects, as if made on and as of the date hereof.
11. CONTINUING EFFECT OF CREDIT AGREEMENT. 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 Administrative Agent and/or the Lenders.
Except as expressly amended hereby, the provisions of the Credit Agreement are
and shall remain in full force and effect.
12. COUNTERPARTS. This Amendment may be executed in counterparts and all of
the said counterparts taken together shall be deemed to constitute one and the
same instrument.
13. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
14. EXPENSES. The Borrower agrees to pay or reimburse the Administrative
Agent for all of its out-of-pocket costs and expenses incurred in connection
with the preparation, negotiation and execution of this Amendment, including,
without limitation, the fees and disbursements of counsel to the Administrative
Agent.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their duly authorized officers as of the date first
written above.
RECOTON CORPORATION
By:
THE CHASE MANHATTAN BANK, as
Administrative Agent and as a Lender
By:
Title:
SUNTRUST BANK, CENTRAL FLORIDA,
NATIONAL ASSOCIATION, as a Lender
By:
Title:
XXXXXX TRUST AND SAVINGS BANK,
as a Lender
By:
Title:
MARINE MIDLAND BANK, as a Lender
By:
Title:
XXXXXX JAPAN, INC., an Illinois
corporation
By:
Name: Stuart Mont
Title: Vice President
RECOTON INTERNATIONAL HOLDINGS,
INC., a Delaware corporation
By:
Name: Stuart Mont
Title: Vice President
RECOTON EUROPEAN HOLDINGS, INC., a
Delaware corporation
By:
Name: Stuart Mont
Title: Vice President
RECOTON GERMAN HOLDINGS GMBH, a
German corporation
By:
Name:
Title:
MAC AUDIO ELECTRONIC GMBH, a
German corporation
By:
Name:
Title:
MAGNAT AUDIO-PRODUKTE GMBH, a
German corporation
By:
Name:
Title:
RECOTON AUDIO-PRODUKTE GMBH, a
German corporation
By:
Name:
Title:
ARCONA S.R.L., an Italian
corporation
By:
Name: Xxxxxx Xxxx
Title: Authorized Agent
RECOTON CANADA LTD., a Canadian
corporation
By:
Name: Stuart Mont
Title: President
RECOTON (FAR EAST) LIMITED, a Hong
Kong corporation
By:
Name:
Title:
STD HOLDING LIMITED, a Hong Kong
corporation
By:
Name:
Title:
STD ELECTRONIC INTERNATIONAL LIMITED,
a Hong Kong corporation
By:__________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
STD MANUFACTURING LIMITED, a
Hong Kong corporation
By:__________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
STD PLASTIC INDUSTRIAL LIMITED, a
Hong Kong corporation
By:__________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
STD TRADING LIMITED, a Hong Kong
corporation
By:__________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
PEAK HERO LIMITED, a Hong Kong
corporation
By:__________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
EVER SMART MANAGEMENT LIMITED,
a Hong Kong corporation
By:__________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
Schedule I
ORIGINAL COMMITMENTS
LENDER COMMITMENT
The Chase Manhattan Bank . $46,875,000
SunTrust Bank, Central Florida, National Association $28,125,000
Xxxxxx Trust and Savings Bank $30,000,000
Marine Midland Bank $30,000,000
Schedule II
SUBSEQUENT COMMITMENTS - $15MM TERM LOANS
LENDER COMMITMENT TERM LOANS
The Chase Manhattan Bank $16,828,000 $ 5,047,000
SunTrust Bank, Central Florida, National Association $10,096,000 $ 3,029,000
Xxxxxx Trust and Savings Bank $11,538,000 $ 3,462,000
Marine Midland Bank $11,538,000 $ 3,462,000
----------- ------------
$50,000,000 $15,000,000
SUBSEQUENT COMMITMENTS -- 560MM TERM LOANS
LENDER COMMITMENT TERM LOANS
The Chase Manhattan Bank $16,828,000 $21,431,000
SunTrust Bank, Central Florida, National Association $10,096,000 $12,819,000
Xxxxxx Trust and Savings Bank $11,538,000 $12,875,000
Marine Midland Bank $11,538,000 $12,875,000
----------- ------------
$50,000,000 $60,000,000
Schedule III to
Credit Agreement
APPLICABLE MARGIN
AND COMMITMENT FEE RATE
ABR Loans Eurodollar Loans Commitment
Leverage Ratio Applicable Margin Applicable Margin Fee Rate
Greater than or equal to 4.00 to 1.00 1.25% 2.00% 025%
Less than 4.00 to 1.00 but greater than 0.90% 1.65% 0.25%
or equal to 3.50 to 1.00
Less than 3.50 to 1.00 but greater than 0.25% 1.00% 0.25%
or equal to 2.75 to 1.00
Less than 2.75 to 1.00 but greater than 0.00% 0.75% 0.20%
or equal to 2.00 to 1.00
Less than 2.00 to 1.00 but greater than 0.00% 0.625% 0.185%
or equal to 1.25 to 1.00
Less than 1.25 to 1.00 0.00% 0.50% 0.125%
