Exhibit 10.17
AMENDMENT NO.4 TO CREDIT AGREEMENT
This AMENDMENT NO.4 TO CREDIT AGREEMENT is made
and entered into as of August 11,2000, by and among
XXXXXX RESPIRATORY CARE INC., a California corporation
(the "Borrower"), RIVER HOLDING CORP., a Delaware
corporation ("Holding") and the Required Lenders (as
defined in Article I of the Credit Agreement).
RECITALS
A. The Borrower, Holding, the Lenders (as defined in Article I of the Credit
Agreement), Salomon Brothers Inc, as Arranger, Advisor and Syndication Agent,
and Bankers Trust Company, as Administrative Agent and Collateral Agent, entered
into a Credit Agreement dated as of April7, 1998 (as amended and otherwise
modified to the date hereof, the "Credit Agreement"). Capitalized terms used
herein and not otherwise defined shall have the meanings assigned to them in the
Credit Agreement.
B. The Borrower requested certain changes to the Credit Agreement.
C. The Required Lenders are willing to so amend the Credit Agreement on the
terms and conditions set forth herein.
D. The Borrower, Holding and the Required Lenders are entering this
Amendment pursuant to Section 9.08(b) of the Credit Agreement.
AGREEMENTS
In consideration of the foregoing Recitals, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Borrower, Holding and the Required Lenders agree as follows:
1. Definitions. (a) The definition of "Capital Expenditures" is amended in
its entirety to read:
"Capital Expenditures" means capital expenditures of the Borrower and
its Subsidiaries determined in accordance with GAAP, excluding a cumulative
amount of up to $4,000,000 of SAP Computer Capital Expenditures.
(b) The table in the definition of "Pricing Adjustment" is amended in its
entirety to read:
Category 1 Category 2 Category 3 Category 4 Category 5
Debt/ Adjusted Debt/Adjusted Debt/Adjusted
EBITDA Ratio EBITDA Ratio EBITDA Ratio
Debt/Adjusted EBITDA less than 5.5:1.0 less than 4.75:1.0 less than 4.0:1.0 and Debt/Adjusted
Ratio greater than or and greater than or and greater than or greater than or equal EBITDA Ratio
equal to 5.5:1.0 equal to 4.75:1.0 equal to 4.0:1.0 to 3.5:1.0 less than 3.5:1.0
---------------- ----------------- ---------------- ---------- -----------------
Commitment 0% 0% 0% .0625% .125%
Fees
ABR Loans 0% .250% .500% .750% 1.000%
Eurodollar 0% .250% .500% .750% 1.000%
Loans
(C) The following definitions are inserted in Section 1.01 of the Credit
Agreement in alphabetical order:
"Holdco" means collectively HRC Holding, Inc., a Delaware corporation,
and Xxxxxx Euro Co S.a.r.l., a Luxembourg corporation.
"SAP Computer Capital Expenditures" means Capital Expenditures for the
installation of the Borrower's SAP computer system, including hardware
costs, SAP licensing fees, implementation consulting, and internally
capitalized labor, in each case incurred on or before June 30, 2000.
2. Interest on Loans. Sections 2.06(a) and (b) of the Credit Agreement are
amended in their entirety to read:
(a) Subject to the provisions of Section 2.07, the Loans comprising
each ABR Borrowing, including each Swingline Loan, shall bear interest
(computed on the basis of the actual number of days elapsed over a year of
365 or 366 days, as the case may be, when the Alternate Base Rate is
determined by reference to the Prime Rate and over a year of 360 days at
all other times) at a rate per annum equal to the Alternate Base Rate plus
2.00% less the applicable Pricing Adjustment.
(b) Subject to the provisions of Section 2.07, the Loans comprising
each Eurodollar Borrowing shall bear interest (computed on the basis of
the actual number of days elapsed over a year of360 days) at a rate per
annum equal to the Adjusted Eurodollar Rate for the Interest Period in
effect for such Borrowing plus 3.00% less the applicable Pricing
Adjustment.
3. Use of Proceeds. Section 3.13(e) is amended in its entirety to read as
follows:
(e) Notwithstanding anything in this Agreement to the contrary, but
subject to Section 2.01(b), not more than $45,000,000 of the Aggregate
Revolving Credit Exposure outstanding at any time may be used by the
Borrower for purposes of Permitted Acquisitions pursuant to Section
6.04(c), and not more than
(i) until December 31,2000, $20,000,000,
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(ii) thereafter, (A) $15,000,000 if the Debt/Adjusted EBITDA
Ratio of the Borrower measured as of the most recently completed
fiscal quarter is greater than 4.25:1.00, and (B) otherwise,
$20,000,000,
of the Aggregate Revolving Credit Exposure outstanding at any time may be
used by the Borrower for any corporate purpose other than Permitted
Acquisitions pursuant to Section 6.04(c).
4. Debt/Adjusted EBITDA Ratio. Section 6.09 of the Credit Agreement is
amended in its entirety to read as follows:
Section 6.09. Debt/Adjusted EBITDA Ratio. The Debt/Adjusted EBITDA
Ratio shall not exceed the following amounts as of the ends of fiscal
quarters of the Borrower ending nearest to the following dates:
Fiscal Quarter Debt/Adjusted EBITDA Ratio
Ending Nearest --------------------------------------------------------------------------------------------
to 1998 1999 2000 2001 2002 2003 2004
--------------------------------------------------------------------------------------------
March 31 6.40:1.00 5.60:1.00 4.90:1.00 3.75:1.00 3.50:1.00 3:50:1.00
June 30 6.75:1:00 6.40:1.00 6.00:1.00 4.50:1.00 3.75:1.00 3.50:1.00
September 30 6.75:1:00 6.20:1.00 5.50:1.00 4.25:1.00 3.75:1.00 3.50:1.00
December 31 6.40:1.00 6.00:1.00 5.25:1.00 4.00:1.00 3.50:1.00 3.50:1.00
--------------------------------------------------------------------------------------------
and thereafter, 3.50:1.00.
5. Interest Coverage Ratio. Sections 6.11(c) and (d) of the Credit
Agreement are amended in their entirety to read as follows:
(c) The ratio of
(i) the EBITDA for the period of four fiscal quarters ending
nearest to December 31, 1998 to
(ii) the product of 1.33 times the Consolidated Interest
Expense for the period of three fiscal quarters ending nearest to
December 31, 1998,
shall not be less than 1.60:1.00.
(d) The ratio of EBITDA to Consolidated Interest Expense for the
period of four fiscal quarters ending nearest to each of the
following dates, shall not be less than the following ratios:
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Fiscal Quarter Ending Consolidated Interest Coverage Ratio
Nearest to ---------------------------------------------------------------------------------
1999 2000 2001 2002 2003 2004
---------------------------------------------------------------------------------
March 31 1.55:1.00 1.80:1.00 2.00:1.00 2.75:1.00 3.00:1:00 3.00:1:00
June 30 1.55:1.00 1.70:1.00 2.20:1.00 2.75:1.00 3.00:1:00
September 30 1.65:1.00 1.70:1.00 2.30:1.00 2.75:1.00 3.00:1:00
December 31 1.65:1.00 1.85:1.00 2.50:1.00 3.00:1.00 3.00:1:00
---------------------------------------------------------------------------------
and thereafter, 3.00:1.00.
6. Fixed Charge Coverage Ratio. Section 6.12 of the Credit Agreement is
amended in its entirety to read as follows:
SECTION 6.12. Fixed Charge Coverage Ratio. The Fixed Charge Coverage
Ratio as of the end of the period of four fiscal quarters ending nearest to
the following dates shall not be less than the following ratios, beginning
with the fiscal quarter ending nearest to March 31, 1999:
Fiscal Quarter Ending Fixed Charge Coverage Ratio
Nearest to ----------------------------------------------------------------------------------
1999 2000 2001 2002 2003 2004
----------------------------------------------------------------------------------
March 31 1.05:1.00 1.00:1.00 1.10:1.00 1.20:1.00 1.20:1.00 1.20:1.00
June 30 1.00:1.00 1.00:1.00 1.15:1.00 1.20:1.00 1.20:1.00
September 30 1.00:1.00 1.00:1.00 1.15:1.00 1.20:1.00 1.20:1.00
December 31 1.00:1.00 1.05:1.00 1.20:1.00 1.20:1.00 1.20:1.00
----------------------------------------------------------------------------------
and thereafter, 1.20:1.00.
7. Binding Effect and Effectiveness. This Amendment may be executed in as
many counterparts as may be convenient and shall become binding when the
Borrower, Holding and the Required Lenders have each executed and delivered at
least one counterpart, and shall become legally binding (and with respect to the
amendments made in items 1 (b) and 2, immediately effective; with respect to the
amendment to the definition of "Holdco", with retrospective effect from June 17,
1999); and with respect to each other amendment herein, with retrospective
effect from June 30,2000) upon satisfaction of the following conditions
precedent:
(a) The Borrower shall have paid to each Lender that executes this
Amendment at or before 12:00 noon, Los Angeles time, on August 11,2000, an
amendment fee equal to 0.25% of such Lender's Revolving Credit Commitment
and outstanding Term Loans as of the date of this Amendment.
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(b) The Borrower shall have paid to the Administrative Agent all fees
which are due and payable to the Administrative Agent under the Credit
Agreement as amended.
8. Governing Law. This Amendment shall be a contract made under and
governed by the laws of the State of New York, without regard to the conflicts
of law provisions thereof
9. Reference to Credit Agreement. Except as amended hereby, the Credit
Agreement shall remain in full force and effect and is hereby ratified and
confirmed in all respects. On and after the effectiveness of the amendment to
the Credit Agreement accomplished hereby, each reference in the Credit
Agreement, to "this Agreement", "hereunder", "hereof', "herein" or words of like
import, and each reference to the Credit Agreement shall be deemed a reference
to the Credit Agreement, as amended hereby, as the case may be.
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IN WITNESS WHEREOF, the parties hereto have cause this amendment to be duly
executed by their respective officers as of the date first above written.
XXXXXX RESPIRATORY CARE INC.,
by: /s/ Xxx X. Xxxxx
---------------------------------------
Name: Xxx X. Xxxxx
Title: Chief Financial Officer
RIVER HOLDING CORP.
by: /s/ Xxx X. Xxxxx
---------------------------------------
Name: Xxx X. Xxxxx
Title: Chief Financial Officer
Acknowledged by:
BANKERS TRUST COMPANY, as
Administrative agent and Collateral Agent
by: /s/ Xxxx Xx Xxxxx
---------------------------------------
Name: Xxxx Xx Xxxxx
Title: Assistant Vice President
SALOMON BROTHERS INC, as Arranger,
Advisor and Syndication Agent,
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
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LENDERS
-------
BANKERS TRUST COMPANY,
by: /s/ Xxxx Xx Xxxxx
---------------------------------------
Name: Xxxx Xx Xxxxx
Title: Assistant Vice President
CITICORP USA, INC.,
by: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION,
by:
---------------------------------------
Name:
Title:
BANK OF TOKYO-MITSUBISHI TRUST COMPANY,
by: /s/ Xxxxxxxx X. Xxxxxxxx, Xx.
---------------------------------------
Name: Xxxxxxxx X. Xxxxxxxx, Xx.
Title: Vice President
BHF (USA) CAPITAL CORP.,
by: /s/ Hans. X. Xxxxxxx
---------------------------------------
Name: Hans. X. Xxxxxxx
Title: Vice President
by: /s/ Xxxxxx X. Xxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.,
by: /s/ Xxxxxxx Xxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President
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by: /s/ Xxxxxxxx X. Xxxxxxxxxx
----------------------------------------
Name: Xxxxxxxx X. Xxxxxxxxxx
Title: Senior Associate
XXXXX FARGO BANK, NA.,
by: /s/ S. Xxxxxxx St. Geme
---------------------------------------
Name: S. Xxxxxxx St. Geme
Title: Vice President
ROYAL BANK OF CANADA,
by: /s/ S. Xxxx Xxxx
---------------------------------------
Name: Xxxx Xxxx
Title: Manager
SOCIETE GENERALE,
by: /s/ X. Xxxxxx Xxxxxxx
---------------------------------------
Name: X. Xxxxxx Xxxxxxx
Title: Director
IMPERIAL BANK,
by: /s/ Ray Valdama
----------------------------------------
Name: Ray Valdama
Title: Senior Managing Director
NATIONS BANK, N.A., as successor to
NationsBank of Texas, N.A.,
by:
---------------------------------------
Name:
Title:
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