EXHIBIT 99
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EXECUTION VERSION
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SECOND AMENDMENT AND WAIVER
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This SECOND AMENDMENT AND WAIVER (this "Second Amendment") is dated as
of December 19, 2003 and is entered into by and between XXX RIVER INC., a
Georgia corporation (the "Borrower") and DEUTSCHE BANK TRUST COMPANY
AMERICAS, in its capacity as the Agent for the Lenders under the Credit
Agreement referred to below (in such capacity, the "Agent").
RECITALS:
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WHEREAS, pursuant to that certain Credit Agreement, dated as of April
15, 2003, by and among (among others) the Borrower, the Agent and the
lenders from time to time party thereto (collectively, the "Lenders") (as
amended, restated, supplemented or otherwise modified from time to time,
including, without limitation, pursuant to the First Amendment and Waiver
thereto dated October 10, 2003, the "Credit Agreement"), the Lenders have
agreed to make certain Loans and issue certain Letters of Credit to and for
the benefit of the Borrower;
WHEREAS, the Borrower expects that an Event of Default will occur and
be continuing as of January 3, 2004 under Section 9.1(b) of the Credit
Agreement as a result of the Borrower's failure to comply with the minimum
fixed charge coverage ratio and the maximum leverage covenants set forth in
Sections 8.1(a) and (b) of the Credit Agreement, in each case for the
Fiscal Quarter ending on such date (collectively, the "Anticipated
Defaults");
WHEREAS, the Majority Lenders are willing to waive the Anticipated
Defaults and agree to certain amendments to the Credit Agreement, in each
case for the time period, on the terms and subject to the conditions set
forth in this Second Amendment; and
WHEREAS, unless otherwise defined herein, capitalized terms used in
this Second Amendment shall have the same definitions as are contained in
the Credit Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and incorporating the
foregoing recitals herein, the parties hereto agree as follows.
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ARTICLE I.
ACKNOWLEDGMENTS
1.1 Acknowledgment of Events of Default; Enforceability of Credit
Agreement and Credit Documents; Waiver of Defenses. The Borrower
acknowledges that: (i) each Anticipated Default will occur and be
continuing as of January 3, 2004 under the Credit Agreement and that each
will constitute a Default and an Event of Default thereunder; (ii) to the
extent that the Credit Agreement or any of the other Credit Documents
require notification by the Agent or the Lenders of the existence of a
Default or Event of Default and of an opportunity for the Borrower to cure
such Default or Event of Default, such notice and period for cure have been
properly given or such requirements have been or are hereby waived by the
Borrower; (iii) as a result of the Anticipated Defaults, and but for the
waiver provided for in this Second Amendment, the Agent, on behalf of the
Secured Parties, and/or the other Secured Parties, without the need for
further notice or declaration with respect to the Anticipated Defaults to
the Borrower or any other entity, would be entitled to exercise any and all
of their rights and remedies under the Credit Agreement and the other
Credit Documents; (iv) the Credit Agreement and the other Credit Documents
are valid legal agreements, enforceable against the Borrower and each of
its Subsidiaries that is a party to any such Credit Document in every
respect and all of the terms and conditions thereof are binding upon the
Borrower and such Subsidiaries; (v) the Loans and other Obligations owing
to the Lenders under the Credit Agreement and the other Credit Documents
represent the legal obligations of the Borrower without defense, offset or
counterclaim, and (vi) no defenses, set-offs or counterclaims exist with
respect to the enforcement by the Agent or any Secured Party of their
respective rights under the Credit Agreement or any other Credit Document;
provided, however, to the extent that any such defenses, set-offs or
counterclaims exist, the Borrower and each such Subsidiary hereby waive any
and all such defenses, set-offs and counterclaims which either the Borrower
or any such Subsidiary may have or claim to have relating to or arising
from the transactions reflected in the Credit Documents or to the
enforcement by the Agent or the other Secured Parties of their respective
rights and remedies under the Credit Agreement, the other Credit Documents
and applicable law.
1.2 Acknowledgment of Indebtedness. The Borrower acknowledges that
as of December 17, 2003, the Borrower was indebted to the Secured Parties
in the aggregate principal amount of $107,440,061.51 in the form of
outstanding Loans and Letters of Credit under the Credit Agreement
(together with interest thereon and certain fees payable in connection
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therewith, but exclusive of any expenses and other amounts payable
thereunder), as more particularly set forth on Schedule 1.2 attached
hereto. The Borrower acknowledges such amounts are outstanding under the
Credit Agreement and continue to be owed to the Secured Parties along with
all other amounts for accrued interest, fees, costs and expenses and that
such other amounts shall continue to accrue under the Credit Agreement.
1.3 Acknowledgment of Liens and Grant of Security Interests. The
Borrower acknowledges that it has granted the Agent, for the benefit of the
Secured Parties, security interests in and liens upon the Collateral
pursuant to the Collateral Documents, which security interests and liens
are perfected and, except where otherwise permitted thereunder, of the
first priority and which security interests and liens secure the
obligations of the Borrower and the other Credit Parties to the Secured
Parties under the Credit Documents. The Borrower further acknowledges the
prior execution and delivery of the Collateral Documents to the Agent, for
the benefit of the Secured Parties, and that, notwithstanding the execution
and delivery of this Second Amendment, the Collateral Documents remain in
full force and effect and the rights and remedies of the Agent and the
Secured Parties thereunder, the obligations of the Borrower and the other
Credit Parties thereunder, and the liens and security interests created and
provided for thereunder remain in full force and effect and shall not be
affected, impaired or discharged hereby.
ARTICLE II.
LIMITED WAIVER
2.1 Waiver. Subject to the terms and conditions set forth in this
Second Amendment (including, without limitation, Article VI), the Agent,
upon the consent of the Majority Lenders, hereby waives each Anticipated
Default.
2.2 Limitation. Nothing in this Second Amendment, nor in any
communication between the Agent and/or any of the other Secured Parties and
the Borrower or any other Credit Party or any officer, agent, employee, or
representative of the Borrower or any Credit Party, shall be construed as a
waiver of or acquiescence to any Default or Event of Default, except as
otherwise expressly set forth in this Second Amendment. The execution and
delivery of this Second Amendment shall not (i) constitute an extension,
modification or waiver of any aspect of the Credit Agreement or the other
Credit Documents (except as expressly provided herein); (ii) extend the
terms of the Credit Agreement or any other Credit Document or the due date
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of any of the Obligations; (iii) give rise to any obligation on the part of
the Agent or the other Secured Parties to extend, modify or waive any term
or condition of the Credit Agreement or any of the other Credit Documents
(except as expressly provided herein); or (iv) give rise to any rights of
setoff, defenses or counterclaims to the right of the Agent and the other
Secured Parties to compel payment and performance of the Obligations or to
otherwise enforce any of their respective rights and remedies under the
Credit Agreement and the other Credit Documents. The Agent and the other
Secured Parties hereby expressly reserve all of their defenses, rights and
remedies under the Credit Documents and under applicable law or otherwise
with respect to any Default or Event of Default (except as expressly
provided herein with respect to the Anticipated Defaults).
ARTICLE III.
AMENDMENT
Subject to the terms and conditions set forth in this Second Amendment
(including, without limitation, Article VI) and in reliance upon the
representations and warranties of the Borrower set forth herein, the Credit
Agreement is hereby amended as follows:
3.1 Amendment to Financial Information Covenant. Section 7.1(d) of
the Credit Agreement is hereby amended by adding the following phrase at
the end thereof: ", it being acknowledged and agreed that the delivery of
such quarterly projections only in respect of fiscal year 2004 shall
satisfy the Borrower's obligations under this Section 7.1(d) for the fiscal
year ending January 3, 2004".
3.2 Additional Affirmative Covenants. Article 7 of the Credit
Agreement is hereby amended by adding the following new sections at the end
thereof:
"Section 7.21. Supplemental Business Plan. On or before January 7,
2004, the Borrower shall have delivered to the Agent a supplement to the
plan delivered by the Borrower on December 1, 2003 pursuant to Section
7.20, which supplement shall contain the types and categories of
information specified by (and otherwise be satisfactory to) the Agent in
its sole discretion."
"Section 7.22. Weekly Cash Flow Summary and Reconciliation.
Commencing on December 5, 2003, and within 5 Business Days of the end of
each fiscal month thereafter, the Borrower shall, in consultation with the
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Borrower's Financial Advisor, furnish or cause to be furnished to the Agent
and the Lenders, a weekly cash flow forecast setting forth projected weekly
cash flows for the next rolling 4 fiscal months (which weekly cash flow
forecast shall be in form and substance reasonably satisfactory to the
Agent). Commencing on the fourth Business Day after December 26, 2003, and
within 4 Business Days of the conclusion of each two-week period
thereafter, the Borrower shall, in consultation with the Borrower's
Financial Advisor, furnish or cause to be furnished to the Agent and the
Lenders, a reconciliation of actual cash flows for the immediately
preceding two-week period as compared against the weekly cash flow forecast
delivered pursuant to the immediately preceding sentence (which
reconciliation shall be in form and substance reasonably satisfactory to
the Agent)."
"Section 7.23. Compliance with First Quarter Financial Covenants. On
or before March 31, 2004, the Borrower shall deliver to the Agent, for
distribution to the Lenders, evidence satisfactory to the Agent (in its
sole and absolute discretion) that the Borrower will be in compliance with
each of the financial covenants set forth in Section 8.1 for the fiscal
quarter ending April 3, 2004. The parties acknowledge and agree that, as
provided in Section 9.1(b), the failure to so deliver such evidence on or
before such date shall constitute an immediate Event of Default and the
Agent, on behalf of the Secured Parties, and/or the Secured Parties,
without the need for further notice or declaration to the Borrower or any
other entity, shall thereafter be entitled to exercise any and all of their
rights and remedies under the Credit Agreement and the other Credit
Documents in respect thereof."
3.3 Amendment to Operating EBITDA Covenant. Section 8.1(c) of the
Credit Agreement is hereby amended by adding the following "Fiscal Periods"
and "Minimum Operating EBITDA Levels" at the end thereof:
"
Fiscal Period Minimum Operating EBITDA
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One month period ending
February 7, 2004: -$1,550,000
Consecutive two month period
ending March 6, 2004: $1,250,000
Consecutive three month
period ending April 3, 2004: $5,200,000 "
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3.4 Amendment to Capital Expenditures Covenant. Section 8.2 of the
Credit Agreement is hereby amended by adding the following sentence at the
end thereof: "In addition to the foregoing annual limitations, the Borrower
shall not, nor shall it permit any of its Subsidiaries to, directly or
indirectly, make or incur any Capital Expenditures, in the aggregate for
the Borrower and its Subsidiaries combined, in excess of (a) $2,400,000
during the one month period ending February 7, 2004, (b) $3,000,000 during
the consecutive two month period ending March 6, 2004 or (c) $3,400,000
during the consecutive three month period ending April 3, 2004."
3.5 Events of Default. Article 9 of the Credit Agreement is hereby
amended by deleting the words "or 7.20" in the fourth line of Section
9.1(b) and replacing them with the words ", 7.20, 7.21, 7.22 or 7.23".
ARTICLE IV.
RELEASE AND INDEMNITY
4.1 Recognizing and in consideration of the Agent's agreement (upon
the consent of the Majority Lenders) to waive the Anticipated Defaults and
agree to the amendments set forth in this Second Amendment, the Borrower,
on its own behalf and on behalf of all persons or entities claiming by,
through, or under the Borrower, does hereby waive and release each of the
Secured Parties and their respective officers, attorneys, agents, and
employees from any liability, suit, damage, claim, loss or expense of any
kind or nature whatsoever and howsoever arising that the Borrower ever had
or now has against any of them arising out of or relating to any Secured
Party's or the Agent's acts or omissions with respect to this Second
Amendment, the Credit Agreement, the other Credit Documents or any other
matters described or referred to herein or therein. The Borrower further
agrees to indemnify and hold the Agent and each Secured Party, and their
respective officers, attorneys, agents, and employees harmless from any
loss, damage, judgment, liability or expense (including counsel fees)
suffered by or rendered against the Agent, the other Secured Parties or any
of them on account of anything arising out of this Second Amendment, the
Credit Agreement, the other Credit Documents or any other document
delivered pursuant hereto or thereto as of and including the date of this
Second Amendment.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
The Borrower hereby represents and warrants to the Agent and the other
Lenders as of the date hereof as follows:
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5.1 Corporate Power. The Borrower has the requisite corporate power
and authority to execute and deliver this Second Amendment and to perform
its obligations hereunder and under the Credit Documents (as amended
hereby). The execution, delivery and performance by the Borrower of this
Second Amendment, and the performance by the Borrower and by each other
Credit Party of each Credit Document (as amended hereby) to which it is a
party have been duly approved by all necessary corporate action of such
Credit Party and no other corporate proceedings on the part of such Credit
Party are necessary to consummate such transactions.
5.2 Authorization and Enforceability. This Second Amendment has been
duly executed and delivered by the Borrower. Each of this Second Amendment
and each Credit Document (as amended hereby) is the legal, valid and
binding obligation of each Credit Party party hereto and thereto,
enforceable against such Credit Party in accordance with its terms, and is
in full force and effect.
5.3 Defaults. Except for the Anticipated Defaults, no event has
occurred and is continuing that constitutes a Default or Event of Default.
5.4 Schedules and other Information. All information contained in
any schedule attached to this Second Amendment or subsequently delivered
pursuant this Second Amendment is or will be complete and accurate as of
the date hereof or thereof.
ARTICLE VI.
CONDITIONS TO EFFECTIVENESS
This Agreement shall not be effective until each of the following
conditions precedent shall have been satisfied.
6.1 Majority Lender Consent. The Majority Lenders shall have
consented in writing to the execution and delivery of this Second Amendment
by the Agent (or the Agent shall have received evidence satisfactory to it
that such written consent has been provided).
6.2 Execution. The Agent, on behalf of the Lenders, shall have
executed this Second Amendment and shall have received counterparts of this
Second Amendment executed by the Borrower.
6.3 Representations and Warranties. Each of the representations and
warranties in Article V above shall be true and correct as of the date of
this Second Amendment.
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6.4 Payment of Fees and Expenses. The Borrower shall have paid all
of the accrued fees and expenses of the Agent and the Lenders (including,
without limitation, the fees and disbursements of counsel for the Agent)
for which invoices shall have been submitted.
6.5 Legal Opinion. The Agent and the Lenders shall have received a
legal opinion from appropriate counsel to the Borrower, in form and
substance reasonably satisfactory to the Administrative Agent, dated as of
the date hereof, as to certain customary matters, including, without
limitation, the due authorization, execution, delivery and enforceability
of this Second Amendment, the enforceability of the Credit Agreement, as
amended hereby, and no conflict with laws or material agreements.
6.6 Amendment Fee. In consideration of the waivers and amendments
contained in this Second Amendment, the Borrower shall have paid to the
Agent, for the benefit of each Lender that has delivered its written
approval of this Second Amendment prior to 5:00 p.m. (
New York time) on
December 19, 2003, an amendment fee equal to $350,000.
ARTICLE VII.
MISCELLANEOUS.
7.1 Reference to and Effect on Credit Documents. On and after the
effectiveness of this Second Amendment, each reference in the Credit
Agreement to "this Agreement", "hereunder", "hereof" or words of similar
import referring to the Credit Agreement, and each reference in each of the
other Credit Documents to "the Credit Agreement", "thereunder", "thereof"
or words of similar import referring to the Credit Agreement, shall mean
and be a reference to the Credit Agreement as amended by this Second
Amendment. Except as otherwise expressly set forth herein, the Credit
Agreement and each other Credit Document shall continue to be, and shall
remain, unaltered and in full force and effect in accordance with their
terms and are hereby confirmed and ratified. To the extent that any
existing provision of the Credit Agreement or any other Credit Document is
inconsistent with the specific provisions of this Second Amendment, the
provisions of this Second Amendment shall control.
7.2 No Novation. This Second Amendment shall not be deemed or
construed to be a satisfaction, restatement, novation or release of the
Credit Agreement or of any of the other Credit Documents or a waiver by the
Agent or any Lender of any of the defenses, rights or remedies of the Agent
and the Lenders under the Credit Agreement or any of the other Credit
Documents or at law or in equity or otherwise.
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7.3 Reaffirmation. The Borrower hereby reaffirms each and every
covenant, condition, obligation and provision set forth in the Credit
Documents (as amended hereby).
7.4 Additional Action. The parties agree to take such further action
to execute and deliver to each other such additional agreements,
instruments and documents as may reasonably be required to carry out the
purposes and intent of this Second Amendment.
7.5 Headings. Section and Article headings in this Second Amendment
are included herein for convenience of reference only and shall not
constitute a part of this Second Amendment for any other purpose.
7.6 Severability. Any provision of this Second Amendment which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
7.7 Governing Law. THIS SECOND AMENDMENT SHALL BE GOVERNED BY, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF
NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.
7.8 Counterparts. This Second Amendment may be executed in any
number of counterparts, and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed
an original, but all such counterparts together shall constitute but one
and the same instrument. Delivery of an executed counterpart of a
signature page to this Second Amendment by facsimile shall be effective as
delivery of a manually executed counterpart of this Second Amendment.
7.9 Construction. The Borrower acknowledges that it has been
represented by its own legal counsel in connection with the negotiation,
execution and delivery of this Second Amendment, that it has exercised
independent judgment with respect to this Second Amendment, and that it has
not relied on the Agent or any Lender or on the Agent's or any Lender's
counsel for any advice with respect to this Second Amendment.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Second
Amendment to be executed and delivered by their proper and duly authorized
officers as of the date first set forth above.
BORROWER:
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XXX RIVER INC., a Georgia corporation
By: _______________________________
Name:
Title:
AGENT:
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DEUTSCHE BANK TRUST COMPANY
AMERICAS, in its capacity as
Agent for and on behalf of the
Lenders
By: _______________________________
Name:
Title:
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SCHEDULE 1.2
PRINCIPAL, INTEREST AND UNUSED LINE FEES
ON LOANS AND LETTERS OF CREDIT
Term Loans $ 37,142,857.00
Revolving Loans $ 63,400,000.00
Letters of Credit $ 6,692,620.30
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PRINCIPAL AMOUNT OF
LOANS AND LETTERS OF
CREDIT OUTSTANDING: $ 107,235,477.30
Term Loan Interest $ 84,216.28
Revolving Loan Interest $ 96,535.49
Unused Line Fee (Revolving Commitments) $ 15,259.24
Letter of Credit Fees $ 8,573.20
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INTEREST AND UNUSED
LINE FEES OUTSTANDING: $ 204,584.21
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TOTAL PRINCIPAL, INTEREST AND
UNUSED LINE FEES OUTSTANDING: $ 107,440,061.51
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