EXHIBIT 4.44
FIFTH AMENDMENT TO LOAN AGREEMENT
THIS FIFTH AMENDMENT TO LOAN AGREEMENT (this "Amendment"),
dated as of August 7, 2003, is by and among Steelcase SAS, a Societe par Actions
Simplifiee organized and existing under the laws of the Republic of France (the
"Borrower"), Steelcase Inc., a Michigan corporation (the "Guarantor"), and
Societe Generale, a bank organized and existing under the laws of the Republic
of France, acting through its Chicago Branch (the "Lender").
WHEREAS, the Borrower, the Guarantor and the Lender are
parties to that certain Loan Agreement dated as of April 9, 1999, as amended by
that certain First Amendment to Loan Agreement dated as of June 15, 2001, as
further amended by that certain Second Amendment to Loan Agreement dated as of
November 9, 2001, as further amended by that certain Third Amendment to Loan
Agreement dated as of November 5, 2002, and as further amended by that certain
Fourth Amendment to Loan Agreement and Waiver dated as of April 17, 2003 (the
"Fourth Amendment") (as such Loan Agreement is further amended hereby and as it
may be, from time to time hereafter, amended, restated, supplemented or
otherwise modified and in effect, the "Loan Agreement"), pursuant to which the
Lender has made certain loans to the Borrower;
WHEREAS, the Guarantor has entered into a Credit Agreement
(the "New Long Term Credit Agreement") dated as of July 29, 2003 with Bank One,
NA (Main Office Chicago), as administrative agent, Bank of America, N.A., as
syndication agent and the financial institutions (including the Lender) party
thereto;
WHEREAS, the Fourth Amendment contemplates that the financial
covenants in Section 10.2 of the Loan Agreement would be amended to conform with
any material replacement of the financial covenants in the Credit Agreement
(Long-Term Multicurrency Revolving Credit Facility) dated as of April 5, 2001
among the Guarantor and the banks and agents party thereto (the "Citibank
Facility");
WHEREAS, the Citibank Facility has terminated and certain
provisions of the New Long Term Credit Agreement replace the financial covenants
in the Citibank Facility; and
WHEREAS, the parties hereto wish to conform the financial
covenants in Section 10.2 of the Loan Agreement with the analogous provisions of
the New Long Term Credit Agreement and to make certain other conforming changes.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter contained, the parties hereto agree as follows:
1. Defined Terms. Capitalized terms used but not defined
herein shall have the meanings ascribed to such terms in the Loan Agreement.
2. Amendment of Loan Agreement. The Loan Agreement is hereby
amended as follows:
(a) Section 1 - New Definitions. Section 1 of the
Loan Agreement is amended by inserting the following new definitions therein in
alphabetical order:
(i) `Adjusted EBITDA' means, with respect to the
Guarantor and its consolidated Subsidiaries (all as
determined in accordance with GAAP):
(a) EBITDA,
minus (b) any extraordinary or unusual gains or
non-recurring gains (including any restructuring
gains, all such non-recurring gains to be determined
by the Guarantor in a manner consistent with the
Guarantor's consolidated financial statements for the
fiscal year ending February 28, 2003) to the extent
added in computing such EBITDA (or plus any
extraordinary or unusual non-cash losses or charges
or non-recurring non-cash losses or charges (other
than any such non-cash loss or charge to the extent
that it represents an accrual of or reserve for cash
expenditures in any future period), including any
non-cash restructuring losses or charges, all such
non-recurring non-cash losses or charges to be
determined by the Guarantor in a manner consistent
with the Guarantor's consolidated financial
statements for the fiscal year ending February 28,
2003) to the extent deducted in computing such
EBITDA, and plus (i) any ---- loss or charge on the
sale of the Guarantor's lease portfolio or (ii) any
loss or charge on the disposition of any
non-strategic assets divested in the fiscal year
ending February 27, 2004 to the extent such losses or
charges do not in the aggregate exceed $25,000,000),
plus (c) cash charges (net of cash gains) in an aggregate
amount not to exceed $20,000,000 to the extent
deducted in computing such EBITDA identified for the
fiscal year ending February 27, 2004 relating to
restructuring activities,
plus (d) any non-cash impairments to fixed assets or
goodwill or other intangible assets to the extent
deducted in computing such EBITDA and such fixed
assets or goodwill or other intangible assets are
identified on the Guarantor's consolidated balance
sheet for the fiscal quarter ending May 30, 2003,
plus (e) for the fiscal quarter ending May 30, 2003,
$13,000,000 (attributable to net nonrecurring charges
occurring during the fiscal quarter ended August 23,
2002),
plus (f) for the fiscal quarters ending May 30, 2003 and
August 29, 2003, $31,000,000 (attributable to net
nonrecurring charges occurring during the fiscal
quarter ended November 22, 2002),
minus (g) for the fiscal quarters ending May 30, 2003,
August 29, 2003 and November 28, 2003, $23,000,000
(attributable to net nonrecurring gains occurring
during the fiscal quarter ended February 28, 2003).
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(ii) `Capital Expenditures' means, for any period, the
aggregate of all expenditures by the Guarantor and
its consolidated Subsidiaries during such period
that, in conformity with GAAP, are required to be
included in or reflected by the property, plant,
equipment or similar fixed asset accounts on the
consolidated balance sheet of the Guarantor and its
Subsidiaries; provided, however, that with respect to
expenditures relating to the acquisition of an asset
in an exchange of a like-kind asset, such
expenditures shall be net of any proceeds received
by, or amounts credited to, the Guarantor or its
consolidated Subsidiaries in connection with the sale
or exchange of the existing asset that is being
functionally replaced within 180 days of such sale or
exchange.
(iii) `Consolidated Net Worth' means, at a particular date,
the amount reported as shareholders' equity on the
consolidated balance sheet for the Guarantor and its
consolidated Subsidiaries for the most recent fiscal
quarter for which financial statements are publicly
available determined in accordance with GAAP."
(iv) `Permitted Receivables Financing' means any
transaction or series of transactions that may be
entered into by the Guarantor or any Subsidiary
pursuant to which the Guarantor and/or any of its
Subsidiaries may sell, convey or otherwise transfer,
directly or indirectly, to a newly-formed special
purpose entity (an "SPV") established solely for the
purpose of purchasing receivables and related assets
in connection with such transaction or series of
transactions or any other Person, any receivables and
related security for the purpose of obtaining
financing; provided that (i) the amount of
obligations that would be characterized as principal
if such transaction or series of transactions were
structured as a secured lending transaction rather
than as a purchase does not exceed $100,000,000 in
the aggregate and (ii) such obligations are
non-recourse to the Guarantor and its Subsidiaries
(other than an SPV) other than limited recourse
customary for receivables financings of the same
kind.
(b) Section 1 - "Subsidiary". The definition of "Subsidiary"
in Section 1 is hereby amended to add the following sentences at the end
thereof:
For purposes of the covenants in Section 10.2 of this
Agreement and the terms used therein, the term
"Subsidiary" or "Subsidiaries" shall exclude the
following "owned dealer affiliates" of the Guarantor:
(i) New Tangram, LLC, Office Environments of New
England, LLC and Texas Xxxxxx Office Products, LLP
for so long as (x) in the case of New Tangram, LLC,
such entity retains the characteristics of an owned
dealer affiliate set forth in the immediately
succeeding clause (ii) (unless the Lender otherwise
consents) and (y) in the case of Office Environments
of New England, LLC and Texas Xxxxxx Office Products,
LLP, each such entity retains the characteristics of
an owned dealer affiliate set forth in the
immediately succeeding clauses (ii)(A) and (ii)(B)
(unless the Lender
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otherwise consents), and (ii) any other entity (A) of
which the Guarantor owns, directly or indirectly, a
majority of the voting interests of such entity or
exercises management control, (B) which was formed or
acquired to facilitate the restructuring,
consolidation or sale of an entity that is an
authorized Steelcase dealer, (C) the management of
which has the right to buy out such entity's shares
over time and (D) the financial results of which are
not incorporated in the Guarantor's consolidated
financial statements or, if such entity's financial
results are incorporated in the Guarantor's
consolidated financial statements, the net income
attributable to such entity is subtracted from the
Guarantor's consolidated financial results.
(c) Section 10.1.1 Section 10.1.1 is hereby amended by
deleting clause (vii) in its entirety and inserting the following new clause
(vii):
"(vii) (A) Liens on receivables and related security
securing a Permitted Receivables Financing and (B)
Liens on the capital stock of any Subsidiary securing
Debt of the Guarantor or any Subsidiary in favor of
Bank One, NA (Main Office Chicago), as administrative
agent (the "Administrative Agent"), with respect to
that certain Credit Agreement dated as of July 29,
2003 among Guarantor, the financial institutions
party thereto, the Administrative Agent, Bank of
America, N.A., as syndication agent, as the same may
be amended, restated supplemented or modified from
time to time; and"
(d) Section 10.2.1. Section 10.2.1 is hereby deleted in its
entirety and replaced with the following new Section 10.2.1:
"10.2.1 Minimum Net Worth. The Guarantor shall not
permit its Consolidated Net Worth at any time to be
less than the sum of (a) $1,000,000,000 plus (b) for
each fiscal year beginning with the fiscal year
ending February 27, 2004, the sum of fifty percent
(50%) of Net Income (if positive) for such fiscal
year, plus (c) fifty percent (50%) of the net cash
proceeds resulting from the issuance by the Guarantor
of any capital stock (other than sales of shares of
the Guarantor's Class A common stock occurring
substantially contemporaneously with a
dollar-for-dollar repurchase of shares of the
Guarantor's Class B common stock); provided that, if
representing an overall loss, charge or deduction, an
amount not to exceed $150,000,000 in the accumulated
other comprehensive income or loss accounts (or
similarly entitled accounts) of the Guarantor and its
Subsidiaries (it being understood and agreed that
such accounts reflect such non-cash adjustments as
foreign currency translation and transaction
adjustments, net unrealized gains/losses on all
investments, minimum pension liability and other
FASB87 and FASB133 related adjustments), shall in
each case be excluded in calculating the Guarantor's
Consolidated Net Worth. The Guarantor's compliance
with this covenant shall be calculated and tested as
of the end of each fiscal quarter of the Guarantor
upon relevant financial statements becoming publicly
available."
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(e) Section 10.2.2. Section 10.2.2 is hereby deleted in its
entirety and replaced with the following new Section 10.2.2:
"10.2.2 Maximum Debt Ratio. The Guarantor shall not
permit the ratio (the "Debt Ratio") of (i) Debt of
the Guarantor and its Subsidiaries on a consolidated
basis to (ii) Adjusted EBITDA to be greater than (a)
3.00 to 1.00 as of the end of each fiscal quarter of
the Guarantor through the fiscal quarter ending
August 27, 2004 and (b) 2.75 to 1.00 as of the end of
each fiscal quarter of the Guarantor thereafter.
The Debt Ratio shall be calculated, upon relevant
financial statements becoming publicly available, as
of the last day of each fiscal quarter of the
Guarantor based upon (a) for Debt, Debt as of the
last day of each such fiscal quarter and (b) for
EBITDA, the actual amount for the four (4) most
recently completed fiscal quarters."
(f) Section 10.2.3. Section 10.2.3 is hereby deleted in its
entirety and replaced with the following new Section 10.2.3:
"10.2.3 Minimum Interest Coverage Ratio. The
Guarantor shall not permit the ratio (the "Interest
Coverage Ratio") of (i) Adjusted EBITDA minus Capital
Expenditures of the Guarantor and its consolidated
Subsidiaries to (ii) interest expense of the
Guarantor and its Subsidiaries on a consolidated
basis to be less than 2.50 to 1.00 for each four (4)
fiscal quarter period of the Guarantor.
The Interest Coverage Ratio shall be calculated, upon
relevant financial statements becoming publicly
available, as of the last day of each fiscal quarter
of the Guarantor based upon (a) for Adjusted EBITDA
and Capital Expenditures, the actual amount for the
last four most recently completed fiscal quarters and
(b) for interest expense, interest expense as of the
last day of such fiscal quarter."
3. Representations and Warranties. In order to induce the
Lender to enter into this Amendment, each of the Borrower and the Guarantor
hereby represents and warrants to the Lender that:
(a) Power; Authority. It is validly existing in the
jurisdiction in which it has been organized; it has the power and authority to
enter into this Amendment; and this Amendment constitutes its legal, valid and
binding obligations and is enforceable against it in accordance with its terms.
(b) No Default. After giving effect to this
Amendment, no Event of Default shall have occurred and be continuing.
4. Conditions to Effectiveness. The effectiveness of this
Amendment is expressly conditioned upon the Borrower delivering to the Lender
this Amendment executed by the Borrower, the Guarantor and the Lender.
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5. Ratification. Each of the Guaranty and, except as
specifically amended hereby, the Loan Agreement shall remain unchanged and
continue in full force and effect and the Borrower and the Guarantor hereby
ratify and confirm the Guaranty and the Loan Agreement, as amended hereby. After
the execution of this Amendment by all parties, any references to the "Loan
Agreement" or the "Agreement" in the Loan Agreement, the Note, the Guaranty, the
Participation Agreement or any other document in connection therewith shall be
to the Loan Agreement, as amended hereby.
6. Miscellaneous.
(a) Successors and Assigns. This Amendment shall be
binding upon and shall be enforceable by the Borrower, the Lender and their
respective permitted successors and assigns; provided that the Borrower shall
have no right to assign or transfer its rights or obligations hereunder without
the prior written consent of the Lender. The terms and provisions of this
Amendment are for the purpose of defining the relative rights and obligations of
Borrower and Lender with respect to the transactions contemplated hereby and
there shall be no third party beneficiaries of any of the terms and provisions
of this Amendment.
(b) Entire Agreement. This Amendment and all
documents referred to herein constitute the entire agreement of the parties
hereto with respect to the subject matter hereof and supersede any prior
expressions of intent or understandings with respect to this Amendment.
(c) Headings. Section headings in this Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Amendment for any other purpose.
(d) Severability. Wherever possible, each provision
of this Amendment shall be interpreted in such a manner as to be effective and
valid under applicable law, but if any provision of this Amendment shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Amendment.
(e) Counterparts. This Amendment may be executed in
any number of separate counterparts, each of which shall collectively and
separately constitute one agreement. Delivery of an executed counterpart of a
signature page to this Amendment by telecopy shall be effective as delivery of a
manually executed counterpart of this Amendment.
(f) Governing Law. This Amendment shall be governed
by and construed in accordance with the laws of the State of New York (including
without limitation Sections 5-1401 and 5-1402 of the New York General
Obligations Law) without giving effect to the principles of conflicts of law.
[signature page follows]
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IN WITNESS WHEREOF, this Fifth Amendment to Loan Agreement has
been duly executed as of the date first written above.
STEELCASE SAS,
as Borrower
By: /s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
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Title: President
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STEELCASE INC.,
as Guarantor
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
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Title: Vice President and Treasurer
---------------------------------
SOCIETE GENERALE,
as Lender
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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Title: Vice President
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