Exhibit 10.1
THIRD AMENDMENT
to
SECOND AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
This Third Amendment to Second Amended and Restated Loan and Security
Agreement ("Amendment") , dated effective as of November 3, 1999 (the "Effective
Date"), is entered into among American Builders & Contractors Supply Co., Inc.,
a Delaware corporation (the "Borrower") with its chief executive office located
at Xxx XXX Xxxxxxx, Xxxxxx, Xxxxxxxxx, the financial institutions listed on the
signature pages hereof (individually, a "lender" and collectively, the
"Lenders") and Bank of America, N.A., a national banking association and
successor in interest to Bank of America, N.A., formerly NationsBank, N.A.,
successor in interest to NationsBank of Texas, N.A., as Agent for the Lenders
(in such capacity, the "agent"):
Recitals
--------
a. The Borrower, the Lenders and the Agent are party to that certain
Second Amended and Restated Loan and Security Agreement dated as of May 12,
1998, as amended by the First Amendment to Second Amended and Restated Loan and
Security Agreement dated effective as of January 15, 1999 and the Second
Amendment to Second Amended and Restated Loan and Security Agreement dated
effective as of May 5, 1999 (the "Loan Agreement") pursuant to which the
Lenders have agreed to make certain loans and extend certain other financial
accommodations to the Borrower as provided therein (terms defined by the Loan
Agreement, where used in this Amendment, shall have the same meanings in this
Amendment as are prescribed by the Loan Agreement).
b. The Borrower, the Agent, and the Lenders desire once again to modify
the Loan Agreement in certain respects, in accordance with the terms and
conditions contained herein.
NOW, THEREFORE, in consideration of the terms and conditions contained
herein, and of any loans or financial accommodations heretofore, now or
hereafter made to or for the benefit of the Borrower by the Lenders, it hereby
is agreed as follows:
ARTICLE I
AMENDMENT TO LOAN AGREEMENT
1.1. Amendment to Section 1.1 of the Loan Agreement. Section 1.1
("Requisite Lenders") of the Loan Agreement is hereby amended and restated to
read in its entirety as follows:
1.1 "Requisite Lenders" shall mean Lenders having, in the aggregate,
Pro Rata Shares of at least 66.67%.
1.2. Amendment to Section 2.8 of the Loan Agreement. Section 2.8 ("Term
of this Agreement") of the Loan Agreement is hereby amended and restated to read
in its entirety as follows:
2.8 Term of this Agreement. Subject to all other terms and
conditions hereof, this Agreement shall be effective until June 30, 2002
(the "Initial Term") and shall automatically extend for successive one year
periods (each a "Term") of one year (each extending through the next
succeeding June 30) unless terminated by the Borrower or the Agent or any
of the Lenders by written notice of intention to terminate this Agreement
as of the end of the Initial Term or any such Term, as the case may be,
which, in order to be effective, must be delivered to all other parties to
this Agreement at least sixty (60) days prior to the end of the Initial
Term or any such Term, as the case may be. Following timely delivery of
any such notice, unless otherwise agreed in writing by the Borrower, the
Agent and all the Lenders, this Agreement shall terminate as of the
expiration of the Initial Term or any such Term, as the case may be,
provided that (a) all of the Agent's and each of the Lenders' rights and
remedies under this Agreement and (b) the security interests reaffirmed and
created under Section 5.1 and under any of the other Financing Agreements,
shall survive any such termination until all of the Liabilities under this
Agreement and the other Financing Agreements have been paid in full. In
addition, the Agent may at any time demand repayment of the Liabilities and
the Liabilities may be accelerated as set forth in Section 9.1. Upon the
effective date of termination, all of the Liabilities shall become
immediately due and payable without notice or demand. Notwithstanding any
termination, until all of the Liabilities hereunder shall have been fully
paid and satisfied, the Agent shall be entitled to retain its security
interests, for the benefit of the Lenders, in and to all existing and
future Collateral and the Borrower shall continue to remit collections of
Accounts and proceeds as provided herein.
1.3. Amendment to Section 8.8 of the Loan Agreement. Section 8.8
("Capital Expenditures Limitation") of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:
8.8 Capital Expenditure Limitations. The Borrower and its
Subsidiaries, if any, shall not purchase, invest in or otherwise acquire,
additional real estate, Equipment, Rolling Stock or other fixed assets,
which, in the aggregate, cost the Borrower and its Subsidiaries, if any,
more than Twenty Six Million Five Hundred Thousand Dollars ($26,500,000.00)
during the calendar year ending December 31, 1997, Thirty Million Dollars
($30,000,000.00) during the calendar year ending December 31, 1998, Twenty
Million Dollars ($20,000,000.00) during the calendar year ending December
31, 1999, Thirty Million Dollars ($30,000,000.00) during the calendar year
ending December 31, 2000 and Thirty Five Million Dollars ($35,000,000.00)
during the calendar year ending December 31, 2001, and any calendar year
thereafter. For purposes of the foregoing, there shall be
excluded therefrom capital expenditures made to finance Store Acquisitions
pursuant to Section 8.3.
1.4. Amendment to Section 8.17 of the Loan Agreement. Section 8.17
("Minimum Tangible Net Worth") of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:
8.17 Minimum Tangible Net Worth. Tangible Net Worth, as determined
as of each date set forth below, shall not be less than the amount set
forth below opposite such date:
Date Amount
---- ------
December 31, 1998 $60,000,000.00
December 31, 1999 $70,000,000.00
December 31, 2000 $75,000,000.00
December 31, 2001 $80,000,000.00
1.5. Amendment to Section 8.18 of the Loan Agreement. Section 8.18
("Maximum Funded Debt to EBITDA") of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:
8.18 Maximum Funded Debt to EBITDA. The ratio of Funded Debt to
EBITDA, determined as of the last day of each calendar quarter and measured
for the preceding period of four calendar quarters, shall not exceed the
following prescribed amounts, as applicable:
Date Ratio
---- -----
December 31, 1997 10.00 to 1.0
March 31, 1998 10.75 to 1.0
June 30, 1998 9.75 to 1.0
September 30, 1998 8.50 to 1.0
December 31, 1998 8.00 to 1.0
March 31, 1999 7.75 to 1.0
June 30, 1999 7.50 to 1.0
September 30, 1999 7.25 to 1.0
December 31, 1999 7.00 to 1.0
March 31, 2000 6.90 to 1.0
June 30, 2000 6.80 to 1.0
September 30, 2000 6.50 to 1.0
December 31, 2000 6.40 to 1.0
March 31, 2001 6.30 to 1.0
June 30, 2001 6.20 to 1.0
September 30, 2001 6.10 to 1.0
December 31, 2001 6.00 to 1.0
March 31, 2002 5.95 to 1.0
June 30, 2002 5.90 to 1.0
1.6. Amendment to Section 8.19 of the Loan Agreement. Section 8.19
("Minimum Fixed Charge Coverage Ratio") of the Loan Agreement is hereby amended
and restated to read in its entirety as follows:
8.19 Minimum Fixed Charge Coverage Ratio. The ratio of (i) EBITDA to
(ii) the sum of interest expense plus the principal portion of current
maturities of long term indebtedness (determined on a consolidated basis
for the Borrower and its Subsidiaries), determined as of the last day of
each calendar quarter and measured for the preceding period of four
calendar quarters, shall not be less than the following prescribed amounts,
as applicable:
Date Ratio
---- -----
December 31, 1997 1.25 to 1.0
March 31, 1998 1.00 to 1.0
June 30, 1998 1.05 to 1.0
September 30, 1998 1.15 to 1.0
December 31, 1998 1.20 to 1.0
March 31, 1999 1.20 to 1.0
June 30, 1999 1.25 to 1.0
September 30, 1999 1.35 to 1.0
Each Quarter Thereafter 1.35 to 1.0
ARTICLE II
MISCELLANEOUS
2.1. Conditions to Effectiveness. This Amendment, including the
amendments and other terms set forth herein, shall become effective as of the
Effective Date upon the satisfaction of each the following conditions precedent,
all of which must be satisfied and acceptable in form and substance to the Agent
and each of the Lenders signatory hereto in each of their sole discretion.
a. Execution and Delivery. This Amendment shall have been executed
and delivered by each of the Borrower, the Agent and Requisite Lenders.
b. Consent and Agreement of Guarantors. Each of Amcraft Building
Products Co., Inc. and Mule-Hide Products Co., Inc. shall have executed the
Consent and Agreement of Guarantors which is attached to and made a part of
this Amendment, in form and substance satisfactory to the Agent.
c. Consent and Agreement by Validity Guarantors. Each of Xxxxxx X.
Story and Xxxxxxx X. Xxxxxxxxx shall have executed the Consent and
Agreement by Validity Guarantors which is attached to and made a part of
this Amendment, in form and substance satisfactory to the Agent.
d. Other. The Borrower shall have executed and delivered all other
agreements, documents, certifications or opinions as the Agent may
reasonably request in connection with implementation of this Amendment.
2.2. Representations, Warranties, Covenants of Borrower. The Borrower
hereby represents and warrants that as of the date of this Amendment and after
giving effect thereto (a) no event has occurred and is continuing which, after
giving effect to this Amendment, constitutes a Default or an Event of Default,
(b) the representations and warranties of the Borrower contained in the Loan
Agreement and the other Financing Agreements are true and correct on and as of
the date hereof to the same extent as though made on and as of the date hereof,
except to the extent such representations and warranties specifically relate to
an earlier date, in which case they are true and correct as of such earlier
date, (c) the execution and delivery by the Borrower of this Amendment and the
performance by the Borrower of the Loan Agreement, as amended by this Amendment,
are within its corporate power and have been duly authorized by all necessary
corporate action, (d) this Amendment and the Loan Agreement, as amended by this
Amendment, are legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their terms and (e) the execution and
delivery by the Borrower of this Amendment and the performance by the Borrower
of the Loan Agreement, as amended by this Amendment, do not require the consent
of any Person and do not contravene the terms of the Borrower's Articles of
Incorporation or By-Laws or any indenture, agreement or undertaking to which the
Borrower is a party or by which the Borrower or any of its property is bound.
2.3. Reference to and Effect on the Loan Agreement. Except as expressly
provided herein, the Loan Agreement and all other Financing Agreements shall
remain unmodified and in full force and effect and are hereby ratified and
confirmed. The execution, delivery and effectiveness of this Amendment shall
not operate as a waiver or forbearance of (a) any right, power or remedy of the
Lenders under the Loan Agreement or any of the other Financing Agreements, or
(b) any Default or Event of Default. This Amendment shall constitute a
Financing Agreement.
2.4. Amendment Fee. Subject to the terms of the Loan Agreement, in
consideration of this Amendment the Borrower agrees to pay to the Agent, for the
benefit of the Lenders, an amendment fee in the amount of $50,000.
2.5. Fees, Costs and Expenses. The Borrower agrees to pay on demand all
costs and expenses of the Agent in connection with the preparation, negotiation,
execution and delivery, and closing of this Amendment and all related
documentation, including the fees and out-of-pocket expenses of counsel for the
Agent with respect thereto.
2.6. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto as separate counterparts, each of
which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, when taken together, shall constitute
but one and the same agreement. A telecopy of any such executed counterpart
shall be deemed valid and may be relied upon as an original.
2.7. Effectiveness. This Amendment shall be deemed effective
prospectively as of the Effective Date specified in the preamble upon execution
by the Borrower, the Agent and sufficient of the Lenders whose names appear on
the signature pages below to constitute Requisite Lenders (subject, however, to
the prior satisfaction of all other conditions for effectiveness as specified by
Section 3.1).
2.8. No Oral Agreements. THIS WRITTEN AGREEMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL
AGREEMENTS BETWEEN THE PARTIES.
[SIGNATURES FOLLOW]
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the day and year first written above.
AMERICAN BUILDERS &
ATTEST: CONTRACTORS SUPPLY CO., INC.
By:_______________________ By:____________________________________________
Name:_____________________ Xxxxxx X. Story, Chief Financial Officer
Title:____________________
BANK OF AMERICA, N.A.
In its capacity as Agent
By:_____________________________________
Xxxx Xxxx, Vice President
AMERICAN NATIONAL BANK AND
TRUST COMPANY OF CHICAGO
In its capacity as Co-Agent
By:________________________________
Name: Xxxxx Xxxxxxxxx
Title:_____________________________
BANK OF AMERICA, N.A.
In its capacity as a Lender
By:________________________________
Xxxx Xxxx, Vice President
AMERICAN NATIONAL BANK AND
TRUST COMPANY OF CHICAGO
In its capacity as a Lender
By:________________________________
Name: Xxxxx Xxxxxxxxx
Title:_____________________________
LASALLE BUSINESS CREDIT, INC.
By:________________________________
Name: Bent Hammeleff
Title:_____________________________
XXXXXX TRUST AND SAVINGS BANK
By:________________________________
Name: Xxxxxxx Xxxxxx
Title:_____________________________
FLEET CAPITAL CORPORATION
By:________________________________
Name: Xxx Xxxxxx
Title:_____________________________
FLEET BUSINESS CREDIT CORPORATION
By:________________________________
Name: Xxx Xxxxxx
Title:_____________________________
CONSENT AND AGREEMENT BY GUARANTORS
Each of the undersigned consents to the foregoing Amendment and each of the
undersigned agrees to the continued effectiveness of the Amended and Restated
Guaranty Agreement dated as of May 12, 1998, executed and delivered by each of
the undersigned, respectively, to the Agent for the benefit of the Lenders. All
references in each such Guaranty, respectively, to the Loan Agreement shall be
deemed to be to the Loan Agreement as amended by the foregoing Amendment and all
prior and subsequent amendments thereof. This Consent and Agreement is executed
as of the Effective Date specified in the Amendment.
AMCRAFT BUILDING PRODUCTS CO., INC.
By:_____________________________
Name:___________________________
Title:__________________________
MULE-HIDE PRODUCTS CO., INC.
By:_____________________________
Name:___________________________
Title:__________________________
CONSENT AND AGREEMENT BY VALIDITY GUARANTORS
Each of the undersigned consents to the foregoing Amendment and each of the
undersigned agrees to the continued effectiveness of the Validity Certification
dated as of May 12, 1998, executed and delivered by each of the undersigned,
respectively, to the Agent for the benefit of the Lenders. All references in
each such Validity Certification, respectively, to the Loan Agreement shall be
deemed to be to the Loan Agreement as amended by the foregoing Amendment and all
prior and subsequent amendments thereof. This Consent and Agreement is executed
as of the Effective Date specified in the Amendment.
_____________________________________
Xxxxxxx X. Xxxxxxxxx
____________________________________
Xxxxxx X. Story
