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MERIX CORPORATION
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THIRD AMENDMENT
Dated as of November 28, 1997
to
Note Purchase Agreements
dated September 10, 1996
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Re: $40,000,000 7.92% Senior Notes
due September 15, 2003
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THIRD AMENDMENT TO NOTE PURCHASE AGREEMENTS
THIS THIRD AMENDMENT dated as of November 28, 1997 (the or this "Third
Amendment") to the Note Purchase Agreements, each dated September 10, 1996, as
amended by the First Amendment to Note Purchase Agreements dated May 28, 1997
and the Second Amendment to Note Purchase Agreements dated August 29, 1997, is
between MERIX CORPORATION, an Oregon corporation (the "Company"), and each of
the institutions which is a signatory to this Third Amendment (collectively, the
"Noteholders").
RECITALS:
A. The Company and each of the Noteholders have heretofore entered into
separate and several Note Purchase Agreements each dated September 10, 1996, as
amended by the First Amendment to Note Purchase Agreements dated May 28, 1997,
and the Second Amendment to Note Purchase Agreements dated August 29, 1997
(collectively, the "Note Purchase Agreements"). The Company has heretofore
issued the $40,000,000 7.92% Senior Notes Due September 15, 2003 (the "Notes")
dated September 10, 1996 pursuant to the Note Purchase Agreements. The
Noteholders are the holders of 100% of the outstanding principal amount of the
Notes.
B. The Company and the Noteholders now desire to amend the Note Purchase
Agreements in the respects, but only in the respects, hereinafter set forth.
C. Capitalized terms used herein shall have the respective meanings
ascribed thereto in the Note Purchase Agreements unless herein defined or the
context shall otherwise require.
D. All requirements of law have been fully complied with and all other acts
and things necessary to make this Third Amendment a valid, legal and binding
instrument according to its terms for the purposes herein expressed have been
done or performed.
NOW, THEREFORE, upon the full and complete satisfaction of the conditions
precedent to the effectiveness of this Third Amendment set forth in Section 3.1
hereof, and in consideration of good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the Company and the Noteholders do
hereby agree as follows:
SECTION 1. AMENDMENT
1.1. Section 10.4 of the Note Purchase Agreements shall be and is hereby
amended in its entirety to read as follows:
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"10.4. Interest Charges Coverage Ratio
(a) The Company will not permit the ratio, as of the
end of the fiscal quarter of the Company ended November 29,
1997, of (i) Consolidated Income Available for Interest
Charges for the fiscal quarter then ended to (ii) Interest
Charges for such fiscal quarter, to be less than 1.60 to
1.00.
(b) The Company will not permit the ratio, as of the
end of the fiscal quarter of the Company ended February 28,
1998, of (i) Consolidated Income Available for Interest
Charges for the period of the four consecutive fiscal
quarters then ended to (ii) Interest Charges for the period
of the four consecutive fiscal quarters then ended, to be
less than 1.90 to 1.00.
(c) The Company will not permit the ratio, as of the
end of any fiscal quarter of the Company ended after
February 28, 1998, of (i) Consolidated Income Available for
Interest Charges for the period of the four consecutive
fiscal quarters then ended to (ii) Interest Charges for the
period of the four consecutive fiscal quarters then ended,
to be less than 2.00 to 1.00.
(d) For purposes of all calculations under this Section
10.4, the restructuring charge determined in accordance with
GAAP of not more than $1,900,000 in the fiscal quarter ended
November 29, 1997 shall be disregarded."
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
2.1. To induce the Noteholders to execute and deliver this Third Amendment
(which representations shall survive the execution and delivery of this Third
Amendment), the Company represents and warrants to the Noteholders that:
(a) this Third Amendment has been duly authorized, executed and
delivered by the Company and this Third Amendment, the Note Purchase
Agreements, as amended by this Third Amendment, and the Notes, constitute
the legal, valid and binding obligations of the Company enforceable against
it in accordance with their respective terms, except as such enforceability
may be limited by (i) applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law);
(b) the execution, delivery and performance by the Company of this
Third Amendment (i) has been duly authorized by all necessary corporate
action on the part of the Company, (ii) does not require the consent,
approval or authorization of, or registration, filing or declaration with,
or other action by, any Governmental Authority or any other Person and
(iii) will not (A) contravene, result in any breach of, constitute a
default under, result in the creation of any Lien in respect of any
property of the Company under, or give any other Person the right to
require the Company to purchase or repay any Debt under, any indenture,
mortgage, deed of trust, loan, purchase or credit agreement, lease,
corporate charter or by-laws, or any other agreement or instrument to which
the Company is bound or by which the Company or any of its properties may
be bound or affected, (B) conflict with or result in any breach of any of
the terms, conditions or provisions of any order, judgment, decree or
ruling of any court, arbitrator or Governmental Authority applicable to the
Company or (C) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company;
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(d) as of the date hereof and after giving effect to this Third
Amendment, (i) no Default or Event of Default has occurred and is
continuing and (ii) no event has occurred and no condition exists which has
had a Material Adverse Effect; and
(e) all the representations and warranties contained in Section 5 of
the Note Purchase Agreements are true and correct in all material respects
with the same force and effect as if made by the Company on and as of the
date hereof.
SECTION 3. CONDITION TO EFFECTIVENESS OF THIS THIRD AMENDMENT; DELIVERY OF
BOARD RESOLUTIONS.
3.1. This Third Amendment shall become effective and binding upon the
Company and the Noteholders at such time as executed counterparts of this Third
Amendment, duly executed by the Company and the Noteholders, shall have been
delivered to the Noteholders.
SECTION 4. PAYMENT OF NOTEHOLDERS' COUNSEL FEES AND EXPENSES.
4.1. The Company agrees to pay upon demand, the reasonable fees and
expenses of Xxxxxx, Xxxx & Xxxxxxx, special counsel to the Noteholders, in
connection with the negotiation, preparation, approval, execution and delivery
of this Third Amendment.
SECTION 5. MISCELLANEOUS.
5.1. This Third Amendment shall be construed in connection with and as part
of each of the Note Purchase Agreements, and except as modified and expressly
amended by this Third Amendment, all terms, conditions and covenants contained
in the Note Purchase Agreements and the Notes are hereby ratified and shall be
and remain in full force and effect. This Third Amendment embodies the entire
agreement and understanding between the Company and the Noteholders and
supersedes all prior agreements and understandings relating to the subject
matter hereof.
5.2. Any and all notices, requests, certificates and other instruments
executed and delivered after the execution and delivery of this Third Amendment
may refer to the Note Purchase Agreements without making specific reference to
this Third Amendment but nevertheless all such references shall include this
Third Amendment unless the context otherwise requires. This Third Amendment is
an Operative Document. The headings in this Third Amendment are for purposes of
reference only and shall not limit or otherwise affect the meaning hereof. The
execution hereof by you shall constitute a contract between us for the uses and
purposes hereinabove set forth, and this Third Amendment may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one instrument.
5.3. This Third Amendment shall be governed by and construed in accordance
with, and the rights of the parties shall be governed by, the law of The
Commonwealth of Massachusetts excluding choice-of-law principles of the law of
such jurisdiction that would require the application of the law of a
jurisdiction other than such jurisdiction.
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If you are in agreement with the foregoing, please sign the accompanying
counterpart of this Third Amendment and return it to the Company, whereupon the
foregoing shall become a binding agreement between you and the Company.
MERIX CORPORATION
By: /s/ XXXXXX X. XXXXXX
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Its Sr. VP & CFO
By: /s/ XXXXX X. XXXXX
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Its VP, Corporate Controller & Treasurer
By: /s/ XXXXXX X. XXXXXXXX, XX.
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Its VP Corporate Development &
Secretary
Accepted and Agreed to:
XXXX XXXXXXX MUTUAL LIFE
INSURANCE COMPANY
By: /s/ D. XXXX XXXXXXX
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Its Senior Investment Officer
XXXX XXXXXXX VARIABLE LIFE
INSURANCE COMPANY
By: /s/ D. XXXX XXXXXXX
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Its Authorized Officer
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MASSACHUSETTS MUTUAL LIFE
INSURANCE COMPANY
By: /s/ XXXXXXX X. XXXXXXXX
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Its Managing Director
CM LIFE INSURANCE COMPANY
By: /s/ XXXXXXX X. XXXXXXXX
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Its Authorized Officer