EXHIBIT 10.17
FIRST AMENDMENT TO CREDIT AGREEMENT AND WAIVER
Xxxxxx Trust and Savings Bank,
as Administrative Agent and as a Bank
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx
Gentlemen:
The undersigned, Donnelley Enterprise Solutions Incorporated, a Delaware
corporation (The "Company") and the various Borrowing Subsidiaries (individually
as "Borrower" collectively as "Borrowers") refer to the Credit Agreement dated
as of October 30, 1996, may be amended from time to time (the "Agreement") and
currently in effect between the Borrowers and Xxxxxx Trust and Savings Bank, as
Administrative Agent for itself and the other Financial Institutions from time
to time party thereto (individually "Bank" and collectively the "Banks"). All
capitalized terms used herein without definition shall have the same meanings as
they have in the Agreement.
The Borrowers hereby apply to the Banks for certain modifications to the
Agreement and the Borrowers' borrowing arrangements with the Banks and for the
waiver of certain covenants contained in the Agreement.
1. AMENDMENT.
Upon the Banks' acceptance hereof in the space provided for that purpose
below, the Agreement shall be and hereby is amended as follows:
(a) The definition of "Fixed Rate Coverage Ratio" in Article I, Section
1.01 shall be and hereby is amended in its entirety to read as follows:
"Fixed Charge Coverage Ratio" means the ratio, determined
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on a consolidated basis for the Company and its
Consolidated Subsidiaries in accordance with GAAP as of
the end of any fiscal quarter, of (i) Consolidated EBITA
plus Minimum Operating Lease Payments to (ii) Consolidated
Interest Expense plus Minimum Operating Lease Payments, in
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each case determined as of the last day of such fiscal
quarter for the four-quarter period then ended.
(b) The definition of "Funded Debt to Cash Flow Raito" in Article I,
Section 1.01 shall be and hereby is amended in its entirety to ready as follows:
"Funded Debt to Cash Flow Ratio" means the ratio,
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determined on a consolidated basis for the Company and its
Consolidated Subsidiaries in accordance with GAAP as of
the end of any fiscal quarter, of (i) Consolidated Debt to
(ii) Consolidated EBITDA for the four-quarter period then
ended. For the first four fiscal quarters following an
Acquisition, Consolidated EBITDA shall include, for any
period of calculation prior to the date of such
Acquisition, the Consolidated EBITDA (determined on a pro
forma basis if no actual financial information is
available) of the company or business that was the subject
of such Acquisition for such prior period.
(c) The definition of "Xxxxxx Bank Offered Rate" shall be added to Article
I, Section 1.01 after the definition of "Xxxxxx Bank" and shall read as follows:
"Xxxxxx Bank Offered Rate" means, for any day, the fixed
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rate of interest per annum equal to the rate offered by
Xxxxxx Trust and Savings Bank.
(d) Article II, Section 2.07 shall be and hereby is amended as follows:
Xxxxxx Bank Offered Rate Advances. During such period as
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such advance is a Xxxxxx Bank Offered Rate Advance, a rate
per annum equal at all times during each Interest Period
for such Advance to the Xxxxxx Bank Offered Rate in effect
from time to time, payable on the last day of such
Interest Period and, if such Interest Period has a
duration of more than three months, on each day which
occurs during such Interest Period every three months from
the first day of such Interest Period and on the date such
Xxxxxx Bank Offered Rate shall be converted or paid in
full. All Xxxxxx Bank Offered Rate Advances hereunder
shall net exceed the sum of $5,000,000 and conform to the
provisions and requirements of Eurocurrency Rate Advances,
excluding the requirements for Alternative Currencies
which are not permitted for Xxxxxx Bank Offered Rate
Advances and excluding the notice of Borrowing
requirements per Article II, Section 2.02 under which the
Xxxxxx Bank Offered Rate Advances shall conform to the
requirements of Base Rate Advances.
Subsections (b) and (c) of Section 2.07 shall be re-lettered as subsections (c)
and (d) and be entitled as follows:
(c) Eurocurrency Rate Advances.
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(d) Default Interest.
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(e) Article V, Section 5.03 shall be and hereby is amended in its entirety
to read as follows:
SECTION 5.03. Use of Proceeds. The Borrowers will use the
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proceeds of the Advances and Letters of Credit under this
Agreement for general corporate purposes otherwise
permitted under this Agreement, including, without
limitation, working capital needs and acquisitions, and
for the purchase of the Borrowers' common stock, not to
exceed the sum of $10,000,000. The Borrowers further agree
that no proceeds of any Advance shall be used to purchase
or carry Margin Stock, except for the purchase of the
Borrowers' common stock, not to exceed the sum of
$10,000,000; provided however, that notwithstanding
anything herein to the contrary, such common stock
purchases shall be permitted under this Agreement, so long
as, the Borrowers' provide the Banks with all the
necessary documentation and notification to comply with
Regulation U of the Board of Governors of the Federal
Reserve contemporaneously with the use of any proceeds of
Advances and Letters of Credit under this Agreement.
2. WAIVER.
The Banks waive any non-compliance with the terms of the Agreement which,
after giving effect to this First Amendment, shall no longer exist.
3. CONDITIONS PRECEDENT.
The effectiveness of the First Amendment is subject to the satisfaction of
all of the following conditions precedent:
(a) The Company and the Banks shall have executed this First Amendment.
(b) The Banks shall have received copies executed or certified (as may be
appropriate) of all legal documents or proceedings taken in connection with the
execution and delivery hereof and the other instruments and documents
contemplated hereby.
(c) All legal matters incident to the execution and delivery hereof and of
the instruments and documents contemplated hereby shall be satisfactory to the
Banks and their counsel.
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4. REPRESENTATIONS.
In order to induce the Banks to execute and deliver this First Amendment,
the Borrowers hereby represent to the Banks that as of the date hereof and as of
the time that this First Amendment becomes effective, each of the
representations and warranties set forth in Article IV of the Agreement are and
shall be and remain true and correct (except that the representations contained
in Article IV Section 4.01 (e) shall be deemed to refer to the most recent
financial statements of the Borrowers delivered to the Bank) and the Borrowers
are in full compliance with all of the terms and conditions of the Agreement and
no Event of Default as defined in the Agreement as amended hereby nor any Event
of Default as so defined, shall have occurred and be continuing or shall arise
after giving effect to this First Amendment.
5. MISCELLANEOUS.
(a) Effect of Amendment. Except as specifically amended and modified
hereby, the agreement shall stand and remain unchanged and in full force and
effect in accordance with its original terms. Reference to this specific First
Amendment need not be made in any note, instrument or other document making
reference to the Agreement, any reference to the Agreement in any of such to be
deemed to be a reference to the Agreement as amended hereby.
(b) Costs and Expenses. The Borrowers agree to pay on demand all out-of-
pocket costs and expenses incurred by the Banks in connection with the
negotiation, preparation, execution and delivery of this First Amendment and the
documents and transactions contemplated hereby, including the fees and expenses
of counsel to the Banks with respect to the foregoing.
(c) Counterparts; Governing Law. This First Amendment may be executed in
any number of counterparts and by different parties hereto on separate
counterparts, each of which when so executed shall be an original but all of
which to constitute one and the same agreement. This First Amendment shall be
governed by the internal laws of the State of Illinois.
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Dated as of June 2, 1997, effective as of March 31, 1997.
DONNELLEY ENTERPRISE
SOLUTIONS INCORPORATED
By: /s/ Xxxx X. Xxxxxx
Its Senior Vice President and Chief
Financial Officer
Accepted and agreed to at Chicago, Illinois, as of the date and year last
above written.
XXXXXX TRUST AND SAVINGS BANK
as Administrative Agent and as a Bank
By: /s/ Xxxxx X. Xxxxxx, Xx
Xxxxx X. Xxxxxx, Xx.
Its Vice President
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