EXHIBIT 10(p)
SECOND AMENDMENT TO CREDIT AGREEMENT
SECOND AMENDMENT TO CREDIT AGREEMENT, dated as of November 7, 2000 (this
"Amendment"), among BOUNDLESS TECHNOLOGIES, INC. ("Boundless Technologies"),
BOUNDLESS MANUFACTURING SERVICES, INC. ("BMS"; with Boundless Technologies, the
"Co-Borrowers"), MERINTA, INC. ("Merinta"), BOUNDLESS ACQUISITION CORP. ("BAC")
and BOUNDLESS CORPORATION ("BC" collectively, with BAC, the "Guarantors") and
THE CHASE MANHATTAN BANK, SILICON VALLEY BANK and NATIONAL BANK OF CANADA
(collectively, the "Banks") and THE CHASE MANHATTAN BANK, as agent for the Banks
(in such capacity, the "Administrative Agent").
RECITALS:
A. The Co-Borrowers, Merinta, the Guarantors, the Banks and the
Administrative Agent are currently parties to that certain Second Amended and
Restated Credit Agreement and Guaranty, dated as of May 25, 2000, as amended by
the Amendment and Waiver to Credit Agreement, dated as of July 31, 2000 (as same
may be further amended, restated, supplemented and otherwise modified, from time
to time, "Credit Agreement").
B. The Co-Borrowers, Merinta and the Guarantors have requested that the
Banks amend certain provisions of the Credit Agreement to reflect the occurrence
of a Merinta Event as described in Section 14.07(b) thereof, and the Banks have
agreed to such amendments subject to the terms and conditions of this Amendment.
C. Any capitalized terms used herein and not defined herein shall have the
meanings ascribed to such terms in the Credit Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE 1.
AMENDMENTS TO CREDIT AGREEMENT
The amendments set forth in this Amendment shall be deemed to be an
amendment to the Credit Agreement and shall not be construed in any way as a
replacement or substitution therefor. All of the terms and provisions of this
Amendment are hereby incorporated by reference into the Credit Agreement as if
such terms were set forth in full therein.
Section 1.1 The Co-Borrowers, Merinta and the Guarantors have advised the
Agent and the Banks that National Semiconductor Corporation will be making a
capital contribution of $5,000,000 in Merinta (the "Merinta Event"). In
accordance with Section 14.07(b) of the Credit Agreement, all references to
Merinta as a "Co-Borrower" or a "Letter of Credit Party" are deemed null and
void and without further effect and Merinta's Accounts and Inventory shall no
longer be deemed eligible for purposes of the calculation of the Borrowing Base.
Merinta shall no longer be considered a "Credit Party" under the Credit
Agreement. The Banks and the Administrator agree that Merinta is hereby released
from all of its obligations and liabilities under the Credit Agreement,
including in its capacity as a Guarantor. In addition, the Banks and the
Administrator further agree that, without prejudicing any of their rights and
remedies against the remaining Co-Borrowers and Guarantors with respect to any
Defaults and Events of Default heretofore occurring or hereafter existing, all
of their rights and remedies as against Merinta with respect to any Defaults and
Events of Default are hereby waived.
Section 1.2. The first paragraph of the Credit Agreement is hereby amended
and restated in its entirety to provide as follows:
"SECOND AMENDED AND RESTATED CREDIT AGREEMENT AND GUARANTY,
dated as of May 25, 2000 among BOUNDLESS TECHNOLOGIES, INC.
("Boundless Technologies"), BOUNDLESS MANUFACTURING
SERVICES, INC. ("BMS"; with Boundless Technologies, the
"Co-Borrowers"), BOUNDLESS ACQUISITION CORP. ("BAC") and
BOUNDLESS CORPORATION ("BC"; collectively with BAC, the
"Guarantors"), THE CHASE MANHATTAN BANK ("Chase"), SILICON
VALLEY BANK ("SVB"), NATIONAL BANK OF CANADA ("NBC"), each
other lender which may hereafter execute and deliver an
instrument of assignment with respect to the Credit
Facilities under this Agreement pursuant to Section 14.04
(Chase, SVB, NBC and such other lenders, each a "Bank" and
collectively, the "Banks") and THE CHASE MANHATTAN BANK, as
administrative, documentation and collateral agent for the
Banks (in such capacity, the "Administrative Agent"), as
agent for the Banks."
Section 1.3. Section 1.01 of the Credit Agreement is hereby amended by
amending and restating the following definitions in their entirety to provide as
follows:
"Guarantors means, collectively, BAC, BC and each Person who, from
time to time, becomes a party hereto pursuant to Section 9.10
hereof.
"Letter of Credit Parties" means Boundless Technologies and BMS.
Section 1.4. Clauses (4) and (5) of Section 10.04 of the Credit Agreement
are hereby amended and restated in their entirety to provide as follows:
"(4) loans or advances to any Person other than Merinta, provided
that the aggregate principal amount of all such loans or advances
outstanding at any time will not exceed One Hundred Thousand
Dollars ($100,000); (5) intentionally omitted;"
Section 1.5. Section 11.05 of the Credit Agreement is hereby deleted in its
entirety.
Section 1.6. Section 12.01(11) of the Credit Agreement is hereby deleted in
its entirety.
Section 1.7. Section 14.07(b) of the Credit Agreement is hereby amended by
deleting the last sentence thereof in its entirety.
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Section 1.8. Section 14.07(c) of the Credit Agreement is hereby amended in
its entirety to read as follows:
"(c) Intentionally Omitted.
Section 1.9. Section 14.07(e) of the Credit Agreement is hereby deleted in
its entirety.
ARTICLE 2.
CONDITIONS TO EFFECTIVENESS
Section 2.1. Conditions to Effectiveness. The amendments and waivers to the
Credit Agreement described herein are subject to receipt by the Administrative
Agent of the following documents:
(a) this Amendment, duly executed by each Co-Borrower and each
Guarantor;
(b) the Amendment and Reaffirmation to Pledge Agreement, substantially
in the form attached hereto as Exhibit 1, duly executed by BC, together with a
stock certificate evidencing such shares, and stock powers executed in blank;
and
(c) the Merinta Documents executed and delivered in connection with
the Merinta Event.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
Each Co-Borrower hereby represents and warrants to the Banks that:
Section 3.1. Except as described on Schedule 3 hereto, each of the
representations and warranties set forth in Article VIII of the Credit Agreement
is true as of the date hereof with respect to the Co-Borrower and, to the extent
applicable, each Guarantor and each of their respective Subsidiaries and with
the same effect as though made on the date hereof, and is hereby incorporated
herein in full by reference as if fully restated herein in its entirety. In
addition, each Co-Borrower hereby covenants, represents and warrants to the
Banks that since December 31, 1999 there has been no material adverse change in
the business, operations, properties or financial condition of any Co-Borrower,
any Guarantor or any of their respective Subsidiaries.
Section 3.2. To induce the Banks and the Administrative Agent to continue
to make advances to the Co-Borrowers pursuant to the Credit Agreement, as
amended hereby, the Co-Borrowers hereby acknowledge and agree that, as of the
date hereof, and after giving effect to the terms hereof, there exists (i) no
Default or Event of Default other than those Defaults and Events of Default
described on Schedule 3 hereof and (ii) no right of offset, defense,
counterclaim, claim or objection in favor of the Co-Borrowers arising out of or
with respect to any of the obligations of the Co-Borrowers and the Guarantors
under the Credit Agreement.
Section 3.3. Each Co-Borrower and each Guarantor has the corporate power
and authority to enter into, perform and deliver this Amendment and any other
documents, instruments, agreements or other writings to be delivered in
connection herewith. This Amendment and all documents contemplated hereby or
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delivered in connection herewith, have each been duly authorized, executed and
delivered and the transactions contemplated herein have been duly authorized.
Section 3.4. This Amendment and any other documents, agreements or
instruments now or hereafter executed and delivered to the Banks by the
Co-Borrowers and the Guarantors in connection herewith constitute (or shall,
when delivered, constitute) valid and legally binding obligations of
Co-Borrowers and the Guarantors, each of which is and shall be enforceable
against Co-Borrowers and the Guarantors, as applicable, in accordance with their
respective terms.
Section 3.5. No representation, warranty or statement by the Co-Borrowers
and the Guarantors contained herein or in any other document to be furnished by
the Co-Borrowers and the Guarantors in connection herewith contains, or at the
time of delivery shall contain, any untrue statement of material fact, or omits
or at the time of delivery shall omit to state a material fact necessary to make
such representation, warranty or statement not misleading.
Section 3.6. No consent, waiver or approval of any entity is or will be
required in connection with the execution, delivery, performance, validity or
enforcement of this Amendment, or any other agreements, instruments or documents
to be executed and/or delivered in connection herewith or pursuant hereto.
ARTICLE 4.
MISCELLANEOUS
Section 4.1. This Amendment may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument, and
any party hereto may execute this Amendment by signing (either original or via
facsimile) any such counterpart.
Section 4.2. This Amendment shall be governed by, and interpreted and
construed in accordance with, the laws of the State of New York (without giving
effect to the conflict of laws provisions thereof).
Section 4.3. Except as set forth in Section 1.1 hereof, the execution and
delivery of this Amendment by the Banks shall not be deemed to be a waiver of
any Default or Event of Default that has occurred or that may hereafter arise
pursuant to the terms of the Credit Agreement and the Co-Borrowers and
Guarantors agree that the Banks retain all of their rights and remedies under
the Credit Agreement with respect to any Default or Event of Default, whether
now existing or hereafter arising.
ARTICLE 5.
RELEASE OF SECURITY INTEREST; UNDERTAKING
Section 5.1 The Administrative Agent and the Banks agree that upon
satisfaction of the conditions to effectiveness set forth in Section 2.1(a)
hereof, all of their liens and security interests in and to the collateral owned
by Merinta shall be released and that the Agent shall promptly thereafter
deliver to Merinta, at the Co-Borrowers' expense, such termination statements,
releases, cancellations, discharges or other agreements as may be reasonably
requested by Merinta or the Co-Borrowers in connection with the Administrative
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Agent's and the Banks' above-described release of the security interests and
liens in Merinta and its property, including without limitation termination of
any security agreements of Merinta in favor of the Banks (including releases of
the Intellectual Property described in Schedule 5 hereto) and any UCC
termination statements.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the day and year first above written.
BOUNDLESS TECHNOLOGIES, INC.
By: /s/ XXXXXX XXXXXXX
-----------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
BOUNDLESS MANUFACTURING SERVICES, INC.
By: /s/ XXXXXX XXXXXXX
-----------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
MERINTA, INC.
By: /s/ XXXXX XXXXXXX
-----------------------------------
Name: Xxxxx Xxxxxxx
Title: Chief Financial Officer
BOUNDLESS ACQUISITION CORP.
By: /s/ XXXXXX XXXXXXX
-----------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
BOUNDLESS CORPORATION
By: /s/ XXXXXX XXXXXXX
-----------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
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THE CHASE MANHATTAN BANK,
as a Bank and as Administrative Agent
By: /s/ XXXXXXX XxXXXX
-----------------------------------
Name: Xxxxxxx XxXxxx
Title: Vice President
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SILICON VALLEY BANK,
as a Bank
By: /s/ XXXXXX XXXXXX
----------------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
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NATIONAL BANK OF CANADA,
as a Bank
By: /s/ XXXXXX XXXXXXX
-----------------------------------
Name: Xxxxxx Xxxxxxx
Title:
By: /s/
-----------------------------------
Name:
Title:
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SCHEDULE 3
DEFAULTS AND EVENTS OF DEFAULT
The Co-Borrowers, Merinta, the Guarantors, the Banks and the Administrative
Agent are currently parties to that certain Second Amended and Restated Credit
Agreement and Guaranty, dated as of May 25, 2000, as amended by the Amendment
and Waiver to Credit, dated as of July 31, 2000 (as same may be further amended,
restated, supplemented and otherwise modified, from time to time, "Credit
Agreement").
As of September 30, 2000, the Co-Borrowers, Merinta, and the Guarantors hereby
acknowledge the following Defaults and Events of Default as those terms are
defined in the Credit Agreement:
Section 11.01(a) Minimum Earnings Before Interest, Taxes, Depreciation and
Amortization
7/1/00-9/30/00 Required- $6,400,000 Actual- $5,735,000
Section 11.01(b) Minimum Earnings Before Interest, Taxes, Depreciation and
Amortization
4/1/00-6/30/00 Required- $500,000 Actual- -$1,235,000
7/1/00-9/30/00 Required- -$700,000 Actual- -$7,274,000
Section 11.02 Fixed charge coverage Ratio (Not less than)
7/1/00-9/30/00 Required- 2.00 to 1 Actual- 1.37
Section 11.03 Cash Flow Leverage Ratio (Not greater than)
7/1/00-9/30/00 Required- 3.00 to 1 Actual- 3.49
Section 12.01 (11) Failure of Boundless Corporation to realize an aggregate of
$5,000,000 in net proceeds from all Merinta Events occurring on or before
September 15, 2000 or an aggregate of $12,000,000 in net proceeds from all
Merinta Events or a Merinta Sale on or before October 15, 2000, or to receive a
commitment letter, on or before July 31, 2000, from an investor or investors
wherein such investor or investors shall commit to make an equity infusion in an
amount not less than $5,000,000 to Merinta no later than September 15, 2000.
Section 14.07 (f) failure to execute and deliver to the Agent, within 15 days of
a failure to secure a commitment from an investor to make an equity infusion of
not less than $5,000,000 to Merinta, such documents as the banks may require to
change the structure of the loan transaction to a full dominion and control
asset-based loan transaction.
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SCHEDULE 5
INTELLECTUAL PROPERTY
Patent Application No. Filing Date Description
09/517939 3/3/2000 Framework for Customizable GUI
09/517940 3/3/2000 Persistent Portal for a Browser
09/518586 3/3/2000 System and Method for Tracking
User Interaction
Serial Number Filing Date or
Trademark Number Registration Date Trademark
75/873357 12/15/1999 Persistent Portal
75/683880 4/16/1999 ITERM
75/672634 4/1/1999 IBROW
1,290,485 8/26/1999 IBROW (CTM)
76/064677 6/7/2000 Net Solutions. Net Results
75/911410 2/7/2002 Merinta
75/912108 2/7/2002 Merinta (Design Only)
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EXHIBIT 1
AMENDMENT AND REAFFIRMATION TO
AMENDED AND RESTATED PLEDGE AGREEMENT
November __, 2000
THE CHASE MANHATTAN BANK, as Agent
000 Xxxxx Xxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
Gentlemen:
Reference is hereby made to that certain (a) Amendment No. 2 to Credit
Agreement (the "Amendment"), dated as of the date hereof, by and among Boundless
Corporation (the "Pledgor"), Boundless Technologies, Inc., Boundless
Manufacturing Services, Inc. (collectively, the "Co-Borrowers"), Boundless
Acquisition Corporation (with the Pledgor, collectively, the "Guarantors"), The
Chase Manhattan Bank, Silicon Valley Bank and National Bank of Canada
(collectively, the "Banks") and The Chase Manhattan Bank, as agent for the Banks
(in such capacity, the "Administrative Agent") and (b) Amended and Restated
Pledge Agreement, dated as of May 25, 2000, by the Pledgor to the Banks and the
Administrative Agent (as same may be further amended, restated, modified or
supplemented, from time to time, the "Pledge Agreement"). Capitalized terms not
otherwise defined herein shall have the meanings given to them in the Pledge
Agreement.
In connection with the foregoing and as a condition precedent to the
effectiveness of the Amendment, the Pledgor hereby:
1. acknowledges and confirms that (a) as security for the Guarantor
Obligations, the Pledgor hereby delivers, pledges and assigns to the
Administrative Agent for the benefit of the Banks and creates in the
Administrative Agent for the benefit of the Banks a first security
interest in the shares of stock of Merinta, Inc. which it owns, as same
is represented by the stock certificate listed on Schedule A hereto (the
"Merinta Stock"), (b) the term "Pledged Shares" shall be deemed to
include the Merinta Stock and (c) except as specifically amended herein,
all terms and provisions contained in the Pledge Agreement are, and
shall remain, in full force and effect in accordance with their
respective terms and shall be deemed to apply to the Merinta Stock, as
same may apply to the other Pledged Shares, and are hereby ratified and
confirmed;
2. acknowledges and agrees that the Pledgor is the beneficial owner of that
percentage of the issued and outstanding capital stock of Merinta, as
listed on Schedule A annexed hereto;
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3. acknowledges and agrees that Schedule A to the Pledge Agreement is
hereby amended in its entirety and replaced with Schedule A attached
hereto.
Except as expressly provided herein, the execution, delivery and
effectiveness of this letter shall not operate as a waiver of any right, power
or remedy of the Administrative Agent and the Banks, nor constitute a waiver of
any provision of the Pledge Agreement or the Credit Agreement, or any other
documents, instruments and agreements executed and/or delivered thereunder or in
connection therewith.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered as of the date first above written.
BOUNDLESS CORPORATION
By:
--------------------------
Name:
Title:
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SCHEDULE A
Attached to and forming a part of that certain
Amended and Restated Pledge Agreement dated as
of May 25, 2000, by the Pledgor to the
Administrative Agent and the Banks.
Percentage of
Class of Stock Certificate Total Stock Par Value of Number of Shares
Stock Issuer Stock Number(s) of Issuer Shares
Boundless Common 1 100% No Par Value 100
Acquisition
Corporation
Boundless Common 10 55% $.01 Par Value 11,000,000*
Manufacturing
Services, Inc.
Merinta, Inc. Common 4 69.8% $.01 Par Value 7,000,000
* One share will be canceled for each share issued under BMS's 1999 Incentive
Plan, up to a total of 1,000,000 shares.
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