EXHIBIT 10.7
AMENDMENT NO. 5 TO CREDIT AGREEMENT
THIS AMENDMENT NO. 5 TO CREDIT AGREEMENT (this "Amendment No. 5"),
dated as of December 21, 2001, is by and among XXXXX ENTERPRISES, INCORPORATED,
a Florida corporation (the "Borrower"), the guarantors listed on the signature
pages hereto, the other subsidiaries of the Borrower listed on the signature
pages hereto and BANK OF AMERICA, N.A., a national banking association (the
"Bank").
W I T N E S S E T H:
WHEREAS, the Borrower and the Bank are parties to that certain Credit
Agreement, dated as of February 27, 1998, as amended by a First Amendment to
Credit Agreement dated as of October 1998, an Amendment No. 2 to Credit
Agreement dated as of January 18, 2000, an Amendment No. 3 to Credit Agreement
dated as of May 2, 2000 and an Amendment No. 4 to Credit Agreement dated as of
June 22, 2001 (the "Existing Credit Agreement");
WHEREAS, the Foreign Subsidiary Borrowers have executed the Foreign
Currency Notes pursuant to the Existing Credit Agreement;
WHEREAS, by separate guaranty agreements dated May 2, 2000, May 2,
2000, December 21, 2001, and December 21, 2001 respectively, Sykes E-Commerce,
Incorporated, Sykes Realty, Inc., Xxxxx XX Holdings, LLC, and Sykes Global
Holdings, LLC (collectively, the "Guarantors") agreed to guaranty the Borrower's
obligations under the Credit Agreement;
WHEREAS, the Borrower and the Bank have agreed to amend the Existing
Credit Agreement as set forth herein and the Guarantors and the Foreign
Subsidiary Borrowers desire to acknowledge and agree to such amendment.
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereby agree as follows:
I
DEFINITIONS
SECTION 1.1. Certain Definitions. Unless otherwise defined herein or
the context otherwise requires, terms used in this Amendment No. 5, including
its preamble and recitals, have the following meanings (such meanings to be
equally applicable to the singular and plural forms thereof):
"Amended Credit Agreement" means the Existing Credit Agreement as
amended hereby.
"Amendment No. 5 Effective Date" is defined in Section 5.1.
SECTION 1.2. Other Definitions. Unless otherwise defined herein or the
context otherwise requires, terms used in this Amendment No. 5, including
its preamble and recitals, have the meanings provided in the
Amended Credit Agreement.
II
AMENDMENTS TO EXISTING CREDIT AGREEMENT
Effective as of the Amendment No. 5 Effective Date, the Existing Credit
Agreement is hereby amended in accordance with these Sections 2.1 through 2.4.
Except as so amended, the Existing Credit Agreement, the Notes and the other
Credit Documents shall continue in full force and effect.
SECTION 2.1. Amendments to Section 1.01. Section 1.01 of the Existing
Credit Agreement is hereby amended by inserting, in the alphabetically
appropriate place, the following definition:
"Amendment No. 5" means Amendment No. 5 to Credit Agreement,
dated as of December 21+, 2001, among the Borrower, Sykes Realty, Inc.,
Sykes E-Commerce, Incorporated, the other subsidiaries of the Borrower
listed on the signature pages thereto and the Bank, amending this
Credit Agreement as then in effect.
SECTION 2.2 Amendment to Section 3.05. Section 3.05 of the Existing
Credit Agreement is hereby amended by replacing the first sentence thereof with
the following:
The representations and warranties contained in Sections 6.1,
6.2, 6.3, 6.6, 6.7, 6.9, 6.10, 6.12, 6.13, 6.14 and 6.15 of the
Syndicated Credit Agreement, as in effect on the date of Amendment No.
5 and after giving effect to any amendment or modification to the
Syndicated Credit Agreement which the Bank, acting in its capacity as
the lender hereunder, has approved in a writing referring to this
Credit Agreement (the "Incorporated Representations"), are hereby
incorporated by reference and shall be binding on the Borrower as if
set forth fully herein.
SECTION 2.3 Amendment to Section 4.01. Section 4.01 of the Existing
Credit Agreement is hereby amended by replacing the first sentence thereof with
the following:
The affirmative and negative covenants contained in Sections
7.1 through 7.9 and Sections 8.1 through 8.10 of the Syndicated Credit
Agreement, as in effect on the date of Amendment No. 5 and after giving
effect to any amendment or modification to the Syndicated Credit
Agreement which the Bank, acting in its capacity as the lender
hereunder, has approved in a writing referring to this Credit Agreement
(the "Incorporated Covenants"), are hereby incorporated by reference
and shall be binding on the Borrower as if set forth fully herein.
SECTION 2.4 Amendment to Section 4.02. Section 4.02 of the Existing
Credit Agreement is hereby amended by replacing each reference to "66%" therein
with a reference to "65%".
III
CONSENT AND WAIVER RELATING TO REORGANIZATION
SECTION 3.1 Consent and Waiver. In connection with the pending
reorganization of the Borrower's corporate organizational structure, the Bank
hereby (a) acknowledges its consent to the specific intercompany transactions
outlined on Annex A hereto, to the extent such transactions are described on
such Annex A, (b) waives any Default or Event of Default that may arise under
Section 4.01 of the Amended Credit Agreement solely as a result of the
consummation of the intercompany transactions outlined on Annex A hereto, to the
extent such transactions are described on such Annex A, (c) acknowledges and
agrees that the intercompany payments and distributions made as a result of the
reorganization as described on such Annex A, shall not be regarded as Restricted
Payments for purposes of Section 8.7 of the Syndicated Credit Agreement as
incorporated through Section 4.01 of the Amended Credit Agreement and (d) waive
the requirement pursuant to Section 4.02 of the Existing Credit Agreement that
the Borrower or any Subsidiary of the Borrower cause to be pledged the Voting
Stock of Sykes Investments C.V., a Dutch limited partnership. The waivers set
forth in this Section 3.1 are one-time waivers and shall not be construed to be
(i) waivers as to future compliance with Sections 4.01 or 4.02 of the Amended
Credit Agreement, (ii) waivers of any other Default or Event of Default that may
exist or (iii) an amendment of or modification to the Existing Credit Agreement.
The Bank hereby reserves all of its rights, powers and remedies under the
Amended Credit Agreement, after giving effect to this Amendment No. 5, and
applicable law.
IV
RELEASE OF PLEDGE RELATING TO SYKES CANADA
SECTION 4.1. Release of Pledge Agreement and Related Collateral. The
Bank hereby authorizes and instructs Bank of America, N.A., as collateral agent
(in such capacity, the "Collateral Agent"), to release, effective as of the
Amendment No. 5 Effective Date, (a) that certain Pledge Agreement dated as of
May 2, 2000 given by the Borrower in favor of the Collateral Agent with respect
to the Borrower's pledge of 66% of the capital stock of Sykes Canada Corporation
(formerly Oracle Service Networks Corporation) and (b) the capital stock and
related collateral pledged pursuant to such Pledge Agreement.
V
CONDITIONS TO EFFECTIVENESS
SECTION 5.1. Amendment No. 5 Effective Date. This Amendment No. 5 shall
be and become effective as of the date hereof (the "Amendment No. 5 Effective
Date") when all of the
conditions set forth in this Section 5.1 shall have been satisfied, and
thereafter, this Amendment No. 5 shall be known, and may be referred to, as
"Amendment No. 5."
SECTION 5.1.1. Execution of Counterparts. The Bank shall have
received (including by telecopy) counterparts of this Amendment No. 5
which shall have been duly executed on behalf of the Borrower, the
Guarantors, the other subsidiaries of the Borrower listed on the
signature pages hereto and the Bank.
SECTION 5.1.2. Subsidiary Guaranty. The Bank shall have
received (including by telecopy) counterparts of Guaranty Agreements
which shall have been duly executed on behalf of Sykes Global Holdings,
LLC and on behalf of Xxxxx XX Holdings, LLC.
SECTION 5.1.3. Legal Details, Etc. All documents executed or
submitted pursuant hereto shall be reasonably satisfactory in form and
substance to the Bank and its counsel prior to or by the time of
closing. Prior to or by the time of closing, the Bank and its counsel
shall have received all information, and such counterpart originals or
such certified or other copies of such originals, as the Bank or its
counsel may reasonably request, and all legal matters incident to the
transactions contemplated by this Amendment No. 5 shall be reasonably
satisfactory to the Bank and its counsel.
SECTION 5.1.4. Payment of Amendment Fee. The Borrower shall
have paid to the Bank a fee in connection with this Amendment No. 5 in
an amount equal to 0.075% multiplied by the Revolving Loan Committed
Amount.
VI
MISCELLANEOUS
SECTION 6.1. Representations and Warranties. The Borrower hereby
represents and warrants to the Bank that, after giving effect to this Amendment
No. 5, (a) no Default or Event of Default exists under the Amended Credit
Agreement or any of the other Credit Documents and (b) the representations and
warranties incorporated pursuant to Section 3.05 of the Amended Credit Agreement
are, subject to the limitations set forth therein, true and correct in all
material respects as of the date hereof (except for those which expressly relate
to an earlier date).
SECTION 6.2. Cross-References. References in this Amendment No. 5 to
any Section are, unless otherwise specified, to such Section of this Amendment
No. 5.
SECTION 6.3. Instrument Pursuant to Existing Credit Agreement. This
Amendment No. 5 is a document executed pursuant to the Existing Credit Agreement
and shall (unless otherwise expressly indicated therein) be construed,
administered and applied in accordance with the terms and provisions of the
Existing Credit Agreement.
SECTION 6.4. Credit Documents. The Borrower, the Guarantors and the
other subsidiaries of the Borrower listed on the signature pages hereto hereby
confirm and agree that the Credit Documents are, and shall continue to be, in
full force and effect, and hereby ratify and
confirm in all respects their obligations thereunder, except that, upon the
effectiveness of, and on and after the date of this Amendment No. 5, all
references in each Credit Document to the "Credit Agreement", "thereunder",
"thereof" or words of like import referring to the Existing Credit Agreement
shall mean the Amended Credit Agreement.
SECTION 6.5. Counterparts, Effectiveness, Etc. This Amendment No. 5 may
be executed by the parties hereto in several counterparts, each of which shall
be deemed to be an original and all of which shall constitute together but one
and the same agreement. Delivery of executed counterparts of this Amendment No.
5 by telecopy shall be effective as an original and shall constitute a
representation that an original shall be delivered.
SECTION 6.6. Governing Law; Entire Agreement. THIS AMENDMENT NO. 5
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NORTH CAROLINA WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW
PRINCIPLES THEREOF.
SECTION 6.7. Successors and Assigns. This Amendment No. 5 shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 5
to be executed by their respective duly authorized officers as of the day and
year first above written.
BORROWER: XXXXX ENTERPRISES, INCORPORATED
By:/S/ W. Xxxxxxx Xxxxxxx
----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Sr. Vice President and Chief Financial Officer
GUARANTORS: SYKES REALTY, INC.
By:/S/ W. Xxxxxxx Xxxxxxx
-----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Vice President and Chief Financial Officer
SYKES E-COMMERCE, INCORPORATED
By:/S/ W. Xxxxxxx Xxxxxxx
-----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Secretary and Treasurer
SYKES GLOBAL HOLDINGS, LLC
By:/S/ W. Xxxxxxx Xxxxxxx
----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Sr. Vice President and Chief Financial Officer
XXXXX XX HOLDINGS, LLC
By:/S/ W. Xxxxxxx Xxxxxxx
------------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Sr. Vice President and Chief Financial Officer
Signature Page to Amendment No. 5
to Credit Agreement - Xxxxx Enterprises, Incorporated
December 2001
SUBSIDIARIES OF THE
BORROWER:
SYKES DATASVAR SUPPORT AB,
STOCKHOLM SWEDEN
By:/S/ W. Xxxxxxx Xxxxxxx
-----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Authorized Representative
XXXXX ENTERPRISES GmbH
By:/S/ W. Xxxxxxx Xxxxxxx
-----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Authorized Representative
XXXXX ENTERPRISES INCORPORATED
HOLDINGS BV
By:/S/ W. Xxxxxxx Xxxxxxx
----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Authorized Representative
XXXXX ENTERPRISES INCORPORATED BV
By:/S/ W. Xxxxxxx Xxxxxxx
----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Authorized Representative
SYKES HOLDINGS OF BELGIUM B.V.B.A.
By:/S/ W. Xxxxxxx Xxxxxxx
----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Authorized Representative
MCQUEEN INTERNATIONAL, LIMITED
By:/S/ W. Xxxxxxx Xxxxxxx
----------------------------------------------------
Name: W. Xxxxxxx Xxxxxxx
Title: Authorized Representative
BANK: BANK OF AMERICA, N.A., formerly known
as NationsBank, N.A.
By:/S/ Xxxx X. Xxxxxxxx
----------------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Managing Director
Signature Page to Amendment No. 5
to Credit Agreement -- Xxxxx Enterprises, Incorporated
December 2001
ANNEX A
Description of Borrower's Reorganization
Please see below a description of the proposed planning for Xxxxx Enterprises,
Incorporated (hereinafter referred to as "Sykes" or "the Company").
The purpose of this planning is to improve the Company's treasury position by
allowing it to efficiently transfer funds amongst its domestic and foreign group
members in accord with its business objectives.
In general, the planning contemplates a contribution of various foreign
subsidiaries to a newly formed Dutch limited partnership, (a "Commanditaire
Vennootschap" or "CV"). Prior to their contribution, the Company has held these
foreign subsidiaries directly. The CV will thereafter act as a European holding
company for many of Sykes' foreign subsidiaries.
The planning also contemplates a transaction whereby Sykes' Canadian subsidiary
will purchase Sykes' German subsidiaries.
The Company will effect the planning through a series of steps. The significant
details of these steps are set out below. Although the transactions and amounts
included below represent Sykes' current plan, the actual transactions and
amounts may be slightly different.
1. Sykes will form two new subsidiaries:
- Sykes Canada Company, a Canadian unlimited liability
corporation (hereinafter referred to as "SCC ULC") and
- Xxxxx International Holdings BV, a Dutch corporation
(hereinafter referred to as "NBV");
Sykes will fund these entities with the minimum capital
required;
2. Sykes will contribute the shares of SCC ULC to the capital of
Sykes Canada Corporation, ("SCC"), a wholly owned Canadian
subsidiary of Sykes;
3. Sykes will contribute the shares of SCC, NBV and the shares of
its wholly owned Swedish subsidiary, Datasvar, to its
previously-existing Dutch subsidiary, Xxxxx Enterprises
Holdings, BV (hereinafter referred to as "HBV");
4. HBV will contribute the shares of SCC to NBV;
5. Sykes will form two new wholly-owned US subsidiary, Sykes
Global Holdings, LLC (referred to herein as "US LLC") and
Xxxxx XX Holdings, LLC (referred to herein as "LPLLC");
6. Sykes, through US LLC and LPLLC, will create a new Dutch
entity, Sykes Investments, CV (hereinafter referred to as
"CV"); LPLLC will act as a limited partner of CV holding in
excess of 99.99%, and US LLC will act as a general partner,
holding less than 0.01%;
7. Sykes will contribute the shares of Xxxxx Enterprises GmbH,
its wholly owned German subsidiary (hereinafter referred to as
SE_GmbH), and the shares of HBV to CV.
8. SCC and SCC ULC will amalgamate with the resulting Canadian
entity taking on unlimited liability form (the surviving
entity will hereinafter be referred to as "CanSub ULC");
9. CV will sell approximately $10 million of shares of SE_GmbH to
NBV in exchange for a note payable issued by NBV (hereinafter
referred to as the "NBV Note");
10. CV will sell its remaining shares of SE_GmbH to CanSub ULC in
exchange for an approximately $40 million note payable issued
by CanSub ULC (The "CanSub Note") and for additional shares of
CanSub ULC;
11. NBV will contribute the SE_GmbH shares it recently purchased
(as described above) to the capital of CanSub ULC;
12. CV will sell the CanSub Note to HBV in exchange for an
approximately $40 million note payable issued by HBV;
13. CanSub ULC will distribute approximately $13 million of cash
to NBV as a distribution of capital;
14. NBV will distribute approximately $13 million of cash to CV in
full satisfaction of the NBV Note; and
15. CV will distribute approximately $13 million of cash to Sykes
as a partnership distribution.
