EXHIBIT 10.44
SECOND AMENDMENT TO SECOND AMENDED AND RESTATED LOAN AGREEMENT
THIS SECOND AMENDMENT TO SECOND AMENDED AND RESTATED LOAN AGREEMENT (this
"AMENDMENT") is entered into as of this 6th day of April, 2006 by and among
LASALLE BANK NATIONAL ASSOCIATION ("LBNA"), as Administrative Agent and as a
Lender, SOUTHWEST BANK OF ST. LOUIS ("SWB"), as a Lender, NATIONAL CITY BANK OF
THE MIDWEST ("NCB"), as a Lender, FIFTH THIRD BANK ("FTB"), as a Lender, XXXXXXX
XXXXX CAPITAL, A DIVISION OF XXXXXXX XXXXX BUSINESS FINANCIAL SERVICES INC.
("MLC"), as a Lender, and FIRST BANK ("FB"), as a Lender (collectively LBNA,
SWB, NCB, FTB, MLC, and FB are referred to herein as "Lenders") and TALX
CORPORATION, a Missouri corporation ("BORROWER"); and consented to by TALX UCM
SERVICES, INC., a Missouri corporation ("TUS"), TALX EMPLOYER SERVICES, LLC, a
Missouri limited liability company ("TES"), TALX FASTIME SERVICES, INC., a Texas
Corporation ("TFTS"), TBT ENTERPRISES, INCORPORATED, a Maryland corporation
("TBT"), UI ADVANTAGE, INC., a Maryland corporation ("UI"), NET PROFIT, INC., a
South Carolina corporation ("NET"), TALX TAX INCENTIVE SERVICES, LLC, a Missouri
limited liability company ("TIS"), XXX-XXX ASSOCIATES, INC., a Massachusetts
corporation ("JJ"), TALX TAX CREDITS AND INCENTIVES, LLC, a Missouri limited
liability company ("TTCI"), MANAGEMENT INSIGHT INCENTIVES, LLC, a Missouri
limited liability company ("MII"), and UNEMPLOYMENT SERVICES, LLC, a Missouri
limited liability company ("US") (collectively TUS, TES, TFTS, TBT, UI, NET,
TIS, JJ, TTCI, MII and US are referred to herein as "GUARANTORS").
WITNESSETH
WHEREAS, Borrower obtained an Aggregate Commitment in the principal amount
of up to Forty Million and 00/100 Dollars ($40,000,000.00) pursuant to that
certain Loan Agreement dated March 27, 2002 entered into by the Borrower, LBNA,
and SWB, as amended by that certain First Amendment to Loan Agreement dated July
29, 2002 among Borrower, LBNA, and SWB, as further amended by that certain
Second Amendment to Loan Agreement dated January 27, 2003 among Borrower, LBNA,
and SWB, as further amended by that certain Third Amendment to Loan Agreement
dated June 30, 2003 among Borrower, LBNA, and SWB (as so amended, the "INITIAL
LOAN AGREEMENT");
WHEREAS, in order to refinance the indebtedness outstanding under the
Initial Loan Agreement, Borrower, LBNA, SWB, NCB, FTB, and MLC entered into that
certain Amended and Restated Loan Agreement dated March 31, 2004 increasing the
Aggregate Commitment (as defined therein) to Eighty-Three Million and 00/100
Dollars ($83,000,000.00), as amended by that certain First Amendment to Amended
and Restated Loan Agreement dated September 9, 2004, and that certain Second
Amendment to Amended and Restated Loan Agreement dated September 30, 2004 (as so
amended, the "AMENDED AND RESTATED LOAN AGREEMENT");
WHEREAS, in order to refinance the indebtedness outstanding under the
Amended and Restated Loan Agreement, Borrower, LBNA, SWB, NCB, FTB, and MLC have
entered into that certain Second Amended and Restated Loan Agreement dated April
14, 2005 increasing the Aggregate Revolving Loan Commitment to One Hundred
Million and 00/100 Dollars ($100,000,000.00), as amended by that certain First
Amendment to Second Amended and Restated Loan Agreement dated November 1, 2005
(as so amended, the "SECOND AMENDED AND RESTATED LOAN AGREEMENT"), pursuant to
which, among other things, the Aggregate Revolving Loan Commitment was increased
to One Hundred Fifty Million and 00/100 Dollars ($150,000,000.00);
WHEREAS, the Borrower hereby requests and the Lenders agree to further
amend the Second Amended and Restated Loan Agreement to increase the Aggregate
Revolving Loan Commitment to Two Hundred Million and 00/100 Dollars
($200,000,000.00) and make other amendments as more specifically set forth
herein; and
WHEREAS, all capitalized terms used herein, and not otherwise defined
herein, have the meaning given to them in the Second Amended and Restated Loan
Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto do hereby agree
as follows:
1. AMENDMENTS.
Upon the satisfaction of the conditions precedent set forth herein, the
Second Amended and Restated Loan Agreement shall be amended as follows:
a) AGGREGATE REVOLVING LOAN COMMITMENT. The first sentence of Section
3.1.1 of the Second Amended and Restated Loan Agreement is hereby amended and
restated as follows:
"Subject to the limitations in Section 3.1.2 and elsewhere herein, each
Lender commits to make available to Borrower, from and after the Second
Amendment Effective Date to the Revolving Loan Maturity Date, such Lender's
Pro-Rata Share of an Aggregate Revolving Loan Commitment of $200,000,000,
by funding such Lender's Pro-Rata Share of Revolving Loan Advances made
from time to time by Administrative Agent as provided herein."
b) INCREASES IN AGGREGATE REVOLVING LOAN COMMITMENT. Section 3.4 of
the Second Amended and Restated Loan Agreement shall be amended and restated as
follows:
"SECTION 3.4 INCREASES IN AGGREGATE REVOLVING LOAN COMMITMENT.
3.4.1 REQUEST FOR INCREASE. At any time prior to April 6, 2008 and provided
that the Aggregate Revolving Loan Commitment has been reduced to
$150,000,000 pursuant to Sections 3.6 or 3.7 hereof on or before January 6,
2007, the Borrower may request that the Aggregate Revolving Loan Commitment
be increased without the prior written consent of all of the Lenders;
provided that, (a) the Aggregate Revolving Loan Commitment shall at no time
exceed $200,000,000; (b) the Borrower is not permitted to
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make any such request during the six month period following any reduction
in the Aggregate Revolving Loan Commitment under this Agreement (other than
a reduction pursuant to Section 3.7 hereof); (c) the Borrower is not
permitted to make any such request more frequently than once in any 6-month
period; and (d) each such request must be in a minimum amount of
$10,000,000 and increments of $5,000,000 in excess thereof. Such request
shall be made in a written notice given by the Borrower to the
Administrative Agent and the Lenders not less than twenty (20) Business
Days prior to the proposed effective date of such increase, which notice (a
"Commitment Increase Notice") must specify the amount of the proposed
increase in the Aggregate Revolving Loan Commitment and the proposed
effective date of such increase.
Any increase in the Aggregate Revolving Loan Commitment under this
Agreement is subject to the following conditions precedent: (A) Borrower
must have executed promissory notes in favor of each Lender and any
Proposed New Lender in the amount of each Lender's Pro-Rata Share of the
Aggregate Revolving Loan Commitment, as increased under this Section; (B)
the Borrower must have obtained the consent thereto of each Guarantor and
its reaffirmation of the Loan Document(s) executed by it, which consent and
reaffirmation must be in writing and in form and substance reasonably
satisfactory to the Administrative Agent, (C) as of the date of the
Commitment Increase Notice and as of the proposed effective date of the
increase in the Aggregate Revolving Loan Commitment under this Agreement,
no event shall have occurred and then be continuing which constitutes a
Default, Event of Default, or Existing Default under this Agreement, (D)
the Borrower, the Administrative Agent and each Proposed New Lender or
Lender that agreed to provide a "Commitment" in support of such increase in
the Aggregate Revolving Loan Commitment under this Agreement must have
executed and delivered a "Commitment and Acceptance" substantially in the
form of Exhibit 3.4.1 hereto, (E) counsel for the Borrower and for the
Guarantors must have provided to the Administrative Agent supplemental
opinions in form and substance reasonably satisfactory to the
Administrative Agent, and (F) the Borrower and the Proposed New Lender must
otherwise have executed and delivered such other instruments and documents
as may be required under Section 10.1.1 or that the Administrative Agent
reasonably requests in connection with such increase. If any fee is charged
by the Lenders in connection with any such increase, such fee shall be in
accordance with then prevailing market conditions, which market conditions
shall have been reasonably documented by the Administrative Agent to the
Borrower. Upon satisfaction of the conditions precedent to any increase in
the Aggregate Revolving Loan Commitment under this Agreement, the
Administrative Agent will promptly advise the Borrower and each Lender of
the effective date of such increase.
3.4.2. LENDERS' PARTICIPATION IN INCREASE. In the event Borrower delivers a
Commitment Increase Notice, each of the Lenders will be given the
opportunity to participate in the requested increase. No Lender shall be
obligated to increase its Commitment pursuant to a Commitment Increase
Notice. On or prior to the date that is fifteen (15) Business Days after
receipt of the Commitment Increase Notice, each Lender must submit to the
Administrative Agent a notice indicating the maximum amount by which it is
willing to increase its Commitment in connection with such Commitment
Increase Notice (any such notice to the Administrative Agent being herein a
"Lender
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Increase Notice"). Any Lender which does not submit a Lender Increase
Notice to the Administrative Agent prior to the expiration of such fifteen
(15) Business Day period will be deemed to have denied any increase in its
Commitment. In the event that the increases of Commitments set forth in the
Lender Increase Notices exceed the amount requested by the Borrower in the
Commitment Increase Notice, the Administrative Agent has the right, in
consultation with the Borrower, to allocate the amount of increases
necessary to meet the Borrower's Commitment Increase Notice.
3.4.3. PROPOSED NEW LENDER(S) PARTICIPATION IN INCREASE. In the event that
the Lender Increase Notices are less than the amount requested by the
Borrower, not later than three (3) Business Days prior to the proposed
effective date the Borrower may notify the Administrative Agent of any
financial institution that has agreed to become a "Lender" party hereto (a
"Proposed New Lender") in connection with the Commitment Increase Notice.
Any Proposed New Lender must be consented to by the Administrative Agent
(which consent shall not be unreasonably withheld). If the Borrower does
not arrange for any Proposed New Lender(s) to commit to the shortfall from
the Lender Increase Notices, then the Borrower will be deemed to have
reduced the amount of its Commitment Increase Notice to the aggregate
amount set forth in the Lender Increase Notices. Based upon (i) the Lender
Increase Notices, (ii) any allocations made in connection therewith and
(iii) if applicable, any notice regarding any Proposed New Lender, the
Administrative Agent will notify the Borrower and the Lenders on or before
the Business Day immediately prior to the proposed effective date of the
amount of each Lender's and each Proposed New Lender's Commitment (the
"Effective Commitment Amount") and the amount of the Aggregate Revolving
Loan Commitment under this Agreement which amounts are effective on the
following Business Day.
Upon the effective date of any increase in the Aggregate Revolving Loan
Commitment under this Agreement that is supported by a Proposed New Lender,
such Proposed New Lender will be a party to this Agreement as a Lender,
will have the rights and obligations of a Lender hereunder, and execute any
document evidencing joinder in this Agreement as required by Administrative
Agent. Nothing contained herein constitutes, or otherwise is, a commitment
on the part of any Lender to increase its Commitment hereunder at any time.
3.4.4. BUYING AND SELLING LENDERS. For purposes of this Section 3.4.4, (A)
the term "Buying Lender(s)" means (i) each Lender the Effective Commitment
Amount of which is greater than its Commitment prior to the effective date
of any increase in the Aggregate Revolving Loan Commitment under this
Agreement, and (ii) each Proposed New Lender that is allocated an Effective
Commitment Amount in connection with any Commitment Increase Notice, and
(B) the term "Selling Lender(s)" shall mean each Lender whose Commitment
under this Agreement is not being increased from that in effect prior to
such increase in the Aggregate Revolving Loan Commitment under this
Agreement. Effective on the effective date of any increase in the Aggregate
Revolving Loan Commitment under this Agreement pursuant to Sections 3.4.1,
3.4.2 and 3.4.3 above, each Selling Lender hereby sells, grants, assigns
and conveys to each Buying Lender, without recourse, warranty, or
representation of any kind, except as specifically provided herein, an
undivided percentage in such Selling Lender's right, title and interest in
and to its
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outstanding Revolving Loans in the respective dollar amounts and
percentages necessary so that, from and after such sale, each Selling
Lender's outstanding Revolving Loans shall equal such Selling Lender's
Pro-Rata Share (calculated based upon the Effective Commitment Amounts) of
the outstanding Revolving Loans under this Agreement. Effective on the
effective date of the increase in the Aggregate Revolving Loan Commitment
under this Agreement pursuant to Sections 3.4.1, 3.4.2, and 3.4.3 above,
each Buying Lender hereby purchases and accepts such grant, assignment and
conveyance from the Selling Lenders. Each Buying Lender hereby agrees that
its respective purchase price for the portion of the outstanding Revolving
Loans purchased hereby shall equal the respective dollar amount necessary
so that, from and after such payments, each Buying Lender's outstanding
Revolving Loans shall equal such Buying Lender's Pro-Rata Share (calculated
based upon the Effective Commitment Amounts) of the outstanding Revolving
Loans under this Agreement. Such amount shall be payable on the effective
date of the increase in the Aggregate Revolving Loan Commitment under this
Agreement by wire transfer of immediately available funds to the
Administrative Agent. The Administrative Agent, in turn, shall wire
transfer any such funds received to the Selling Lenders, in same day funds,
for the sole account of the Selling Lenders. Each Selling Lender hereby
represents and warrants to each Buying Lender that such Selling Lender owns
the Revolving Loans being sold and assigned hereby for its own account and
has not sold, transferred or encumbered any or all of its interest in such
Revolving Loans, except for participations which will be extinguished upon
payment to Selling Lender of an amount equal to the portion of the
outstanding Revolving Loans being sold by such Selling Lender. Each Buying
Lender hereby acknowledges and agrees that, except for each Selling
Lender's representations and warranties contained in the foregoing
sentence, each such Buying Lender has entered into its Commitment and
Acceptance with respect to such increase on the basis of its own
independent investigation and has not relied upon, and will not rely upon,
any explicit or implicit written or oral representation, warranty or other
statement of the Lenders or the Administrative Agent concerning the
authorization, execution, legality, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or the other Loan
Documents. The Borrower hereby agrees to compensate each Selling Lender for
all losses, expenses and liabilities incurred by each Lender in connection
with the sale and assignment of any Revolving Loan or Swingline Loan
hereunder on the terms and in the manner as set forth in Section 19.4."
c) MANDATORY DECREASE IN AGGREGATE REVOLVING LOAN COMMITMENT. The
following shall be added to the Second Amended and Restated Loan Agreement as a
new Section 3.7:
"3.7 MANDATORY REDUCTION OF AGGREGATE REVOLVING LOAN COMMITMENT. Upon the
receipt by the Borrower of cash proceeds from the first to occur of (i) the
issuance of Parity Debt in accordance with Section 15.2.9 hereof and (ii)
the issuance of stock in accordance with Section 15.13 hereof with respect
to which the Net Cash Proceeds thereof are at least $50,000,000, (x) the
Aggregate Incremental Commitment shall be reduced to zero and the Aggregate
Revolving Loan Commitment shall automatically be reduced to $150,000,000,
in each case, effective as of the date on which the Administrative Agent
shall have received the prepayment described in Section 6.3.3, and
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(y) each Lender's Revolving Loan Commitment shall be reduced to an amount
equal to such Lender's Base Commitment."
d) INCREMENTAL INCREASE OF AGGREGATE COMMITMENT FEE. Section 5.8 of
the Second Amended and Restated Loan Agreement is hereby amended and restated in
its entirety as follows:
"5.8 INCREMENTAL INCREASE OF AGGREGATE COMMITMENT FEE. Contemporaneously
with the execution and delivery of that certain Second Amendment to Second
Amended and Restated Loan Agreement (the "Second Amendment") dated as of
April 6, 2006, among the Borrower, the Administrative Agent, the Lenders
and the Guarantors, Borrower shall pay to Administrative Agent, (i) a fee
in the amount of $5,000 for the account of each Lender, and (ii) for the
account of each Lender whose Revolving Loan Commitment is increased
pursuant to the Second Amendment, a fee equal to five (5) basis points of
the amount of each Lender's Incremental Commitment."
e) REVOLVING LOAN UNUSED FEE. Section 5.2 of the Second Amended and
Restated Loan Agreement is hereby amended to add the following sentence at the
end thereof: "The Administrative Agent shall distribute the Revolving Loan
Unused Fee to each Lender in accordance with each Lender's Pro-Rata Share."
f) MANDATORY PREPAYMENT UPON ISSUANCE OF PARITY DEBT OR STOCK. The
following shall be added to the Second Amended and Restated Loan Agreement as a
new Section 6.3.3:
"6.3.3 MANDATORY PREPAYMENT UPON ISSUANCE OF PARITY DEBT OR STOCK. Upon the
receipt by the Borrower of cash proceeds from the first to occur of (i) the
issuance by Borrower of Parity Debt in accordance with Section 15.2.9 hereof and
(ii) the issuance of stock in accordance with Section 15.13 with respect to
which the Net Cash Proceeds thereof are at least $50,000,000, Borrower shall
concurrently therewith pay to Administrative Agent for the account of the
Lenders the amount necessary to reduce the Aggregate Revolving Loans to
$150,000,000. The amount of such mandatory prepayment shall be paid by the
Administrative Agent to the Lenders holding Incremental Commitments ratably in
accordance with their respective Pro-Rata Share.
g) RELEASE OF SECURITY INTEREST UPON ISSUANCE OF PARITY DEBT. The
following shall be added to the Second Amended and Restated Loan Agreement as a
new Section 8.6:
"8.6 RELEASE OF SECURITY INTERESTS. Each Lender and the Administrative
Agent hereby agree that the Security Interests securing the Loan
Obligations shall be released upon the occurrence of the following:
(i) the Borrower shall have issued (a) Parity Debt in accordance with
Section 15.2.9 hereof or (b) stock in accordance with Section 15.13
hereof with respect to which the Net Cash Proceeds thereof are at
least $50,000,000;
(ii) the Administrative Agent shall have received the prepayment
described in Section 6.3.3;
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(iii) the Aggregate Revolving Loan Commitment shall have been reduced
to $150,000,000 pursuant to Section 3.7; and
(iv) the Borrower, the Guarantors, the Administrative Agent and the
Lenders shall have entered into an amendment and restatement of this
Agreement and each other Loan Document that the Administrative Agent
deems necessary or that the Borrower reasonably requests to effectuate
the foregoing release and will include, among other things, one or
more provisions to the effect that the Borrower will not, and will not
permit any other Covered Person to, enter into any agreement
containing a negative pledge provision, other than the agreements
governing the Parity Debt."
h) SATISFACTION OF CONDITIONS TO THE APPROVED ACQUISITION. Section
10.3.2 of the Second Amended and Restated Loan Agreement is hereby amended and
restated in its entirety as follows:
"10.3.2. SATISFACTION OF CONDITIONS TO THE APPROVED ACQUISITION.
Administrative Agent shall have received the applicable Approved
Acquisition Documents, which shall be in form and substance satisfactory to
Administrative Agent. Administrative Agent shall be satisfied that all
requirements to close the Approved Acquisition have been completed or
waived by the parties to the Approved Acquisition Documents, except for the
delivery of the purchase price with respect to the Approved Acquisition;
and every other condition, if any, to the applicable Approved Acquisition
as described herein shall be satisfied, or waived by the Administrative
Agent. The Administrative Agent shall have completed its due diligence with
respect to the Approved Acquisition and shall have received evidence
satisfactory to the Administrative Agent that the total amount of Loan
proceeds used as consideration at the time of closing of the Approved
Acquisition shall not exceed the sum of $75,000,000 plus a working capital
adjustment of up to $5,000,000 payable pursuant to the Approved Acquisition
Documents, unless otherwise approved by Administrative Agent prior to
consummation of the Approved Acquisition."
i) CONDITIONS TO ADVANCES FOR APPROVED ACQUISITIONS. Section 10.3.7 of
the Second Amended and Restated Loan Agreement is hereby amended and restated in
its entirety as follows:
"10.3.7. CONSUMMATION OF APPROVED ACQUISITIONS. Any Advance of Loan
proceeds for purposes of consummating the Approved Acquisition must occur
no later than April 30, 2006."
j) ISSUANCE OF PARITY DEBT. The following shall be added to the Second
Amended and Restated Loan Agreement as a new Section 15.2.9:
"15.2.9 PARITY DEBT. Indebtedness issued by Borrower which satisfies the
following criteria (such Indebtedness, the "Parity Debt"):
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(i) the terms and conditions of such Indebtedness and documents
pursuant to which such Indebtedness is issued are reasonably
acceptable to the Required Lenders;
(ii) the original aggregate principal amount of such Indebtedness
shall not be less than $50,000,000 nor in excess of $75,000,000;
(iii) such Indebtedness is unsecured;
(iv) the Administrative Agent and the holders of such Indebtedness
shall have entered into an intercreditor agreement in form and
substance acceptable to the Required Lenders;
(iv) to the extent required by Section 6.3.3 hereof, the Net Cash
Proceeds received by Borrower in connection with the issuance of such
Indebtedness shall be paid to the Administrative Agent, and, to the
extent required by Section 3.7 hereof, the Aggregate Revolving Loan
Commitment shall be reduced to $150,000,000."
k) SPECIAL DEFINITIONS. Section 16.1 of the Second Amended and
Restated Loan Agreement is hereby amended to restate the definitions of "EBIT"
and "EBITDA" in their entirety as follows:
"EBIT means, with respect to any fiscal period of Borrower, the
consolidated net income of Borrower and each Covered Person for such fiscal
period, as determined in accordance with GAAP and reported on the Financial
Statements for such period, plus (i) Interest Expense in such period, (ii)
income tax expense in such period, and (iii) the non-cash charges of any
share-based compensation awards, to the extent such non-cash charges were
expensed during such period in accordance with SFAS 123 or are required to
be shown as an expense in any comparative financial statements for periods
prior to the effective date of SFAS 123. For any period during which a
Prior Acquisition, the Approved Acquisition or any Permitted Acquisition
was consummated, EBIT shall be calculated on a proforma basis as if the
entity acquired in connection with any such acquisition had been acquired
on the first day of such period. From and after the closing of the Approved
Acquisition, EBIT shall be adjusted for the first four consecutive fiscal
quarters thereafter by adding the following amounts to EBIT determined
pursuant to the immediately preceding sentence: $2,700,000.00 for the
quarter ending June 30, 2006, $1,675,000.00 for the quarter ending
September 30, 2006, $650,000.00 for the quarter ending December 31, 2006,
and $325,000.00 for the quarter ending March 31, 2007."
"EBITDA means, with respect to any fiscal period of Borrower, the
consolidated net income of Borrower and each Covered Person for such fiscal
period, as determined in accordance with GAAP and reported on the Financial
Statements for such period, plus (i) (A) Interest Expense in such period,
(B) income tax expense in such period, (C) amortization of good will and
depreciation expense taken in such period, (D) any extraordinary loss in
such period, and (E) the non-cash charges of any share-based compensation
awards, to the extent such non-cash charges were expensed during such
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period in accordance with SFAS 123 or are required to be shown as an
expense in any comparative financial statements for periods prior to the
effective date of SFAS 123, minus (ii) any extraordinary gain in such
period. For any period during which a Prior Acquisition, the Approved
Acquisition or any Permitted Acquisition was consummated, EBITDA shall be
calculated on a proforma basis as if the entity acquired in connection with
any such acquisition had been acquired on the first day of such period.
From and after the closing of the Approved Acquisition, EBITDA shall be
adjusted for the first four consecutive fiscal quarters thereafter by
adding the following amounts to EBITDA determined pursuant to the
immediately preceding sentence: $2,700,000.00 for the quarter ending June
30, 2006, $1,675,000.00 for the quarter ending September 30, 2006,
$650,000.00 for the quarter ending December 31, 2006, and $325,000.00 for
the quarter ending March 31, 2007."
l) MAXIMUM RATIO OF TOTAL FUNDED INDEBTEDNESS TO EBITDA. Section 16.4
of the Second Amended and Restated Loan Agreement is hereby amended and restated
in its entirety as follows:
"16.4. MAXIMUM RATIO OF TOTAL INDEBTEDNESS TO EBITDA. The ratio of
Borrower's Total Indebtedness to EBITDA for the four-quarter period then
ended, calculated the last day of each fiscal quarter ending March 31, June
30, September 30, and December 31 through the Revolving Loan Maturity Date
shall not be greater than 2.50 to 1; provided that, notwithstanding the
foregoing, for the fiscal quarters ending June 30, 2006 and September 30,
2006, the Borrower's ratio of Total Indebtedness to EBITDA shall not be
greater than 2.75 to 1."
m) MINIMUM EBITDA. Section 16.6 of the Second Amended and Restated
Loan Agreement is hereby amended and restated in its entirety as follows:
"16.6. MINIMUM EBITDA. Commencing with the quarter ending June 30, 2006,
Borrower's EBITDA for the four-quarter period then ended, calculated as of
the last day of each fiscal quarter ending June 30, September 30, December
31, and March 31 through the Revolving Loan Maturity Date shall be no less
than (A) $60,400,000, plus (B) 75% of EBITDA of any entity acquired in
connection with a Permitted Acquisition for the most recently-ended four
fiscal quarters prior to the closing of such Permitted Acquisition, as such
amount is mutually agreed by the Administrative Agent and the Borrower."
n) ADMINISTRATIVE AGENT POWERS. Section 18.1 of the Second Amended and
Restated Loan Agreement is hereby amended to add the following sentence at the
end thereof:
"Each Lender hereby authorizes LaSalle, in its capacity as Administrative
Agent hereunder, upon satisfaction of the requirements set forth in Section
15.2.9, to execute an intercreditor agreement in connection with the
issuance by Borrower of Parity Debt. Notwithstanding the foregoing, the
Administrative Agent shall not be obligated to execute such intercreditor
agreement or any other document or instrument related to the Parity Debt."
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o) GLOSSARY. The Glossary located at Exhibit 2.1 of the Second Amended
and Restated Loan Agreement shall be revised as follows:
i) The definition of "AGGREGATE BASE COMMITMENT" is hereby added
as follows:
"AGGREGATE BASE COMMITMENT - means the commitment of the Lenders to fund
Revolving Loan Advances in an aggregate amount of up to $150,000,000."
ii) The definition of "AGGREGATE INCREMENTAL COMMITMENT" is
hereby added as follows:
"AGGREGATE INCREMENTAL COMMITMENT - means the commitment of the Lenders to
fund Revolving Loan Advances in excess of the Aggregate Base Commitment. As
of the Second Amendment Effective Date, the Aggregate Incremental
Commitment shall be $50,000,000."
iii) The definition of "APPROVED ACQUISITIONS" is hereby amended
and restated in its entirety as follows:
"APPROVED ACQUISITION -- means the acquisition by Borrower of the capital
stock of Performance Assessment Network, Inc., a Delaware corporation."
iv) The definition of "APPROVED ACQUISITION DOCUMENTS" is hereby
added as follows:
"APPROVED ACQUISITION DOCUMENTS -- means the acquisition agreement entered
into by Borrower, in the form as furnished and approved by the
Administrative Agent in writing prior to the consummation of the Approved
Acquisition, with only such amendments, modifications or supplements
thereto, or waivers of the terms thereof, as shall be approved in writing
by the Administrative Agent."
v) The definition of "BASE COMMITMENT" is hereby added as
follows:
"BASE COMMITMENT - means with respect to each Lender, such Lender's share
of the Aggregate Base Commitment as set forth opposite such Lender's name
on the table set forth on Exhibit 3 hereto entitled "Base Commitments."
vi) The definition of "BUYING LENDER" is hereby added as follows:
"BUYING LENDER(S) -- is defined in Section 3.4.4."
vii) The definition of "COMMITMENT AND ACCEPTANCE" is hereby
added as follows:
"COMMITMENT AND ACCEPTANCE -- is defined in Section 3.4.1."
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viii) The definition of "COMMITMENT INCREASE NOTICE" is hereby
added as follows:
"COMMITMENT INCREASE NOTICE -- is defined in Section 3.4.2."
ix) The definition of "EFFECTIVE COMMITMENT AMOUNT" is hereby
added as follows:
"EFFECTIVE COMMITMENT AMOUNT -- is defined in Section 3.4.3."
x) The definition of "EXISTING LOAN DOCUMENTS" shall be revised
to include the following language in such definition: "Security Agreement dated
November 1, 2005, executed by Unemployment Services, LLC, a Missouri limited
liability company; the Guaranty of Unemployment Services, LLC dated November 1,
2005; the Collateral Assignment of Membership Interest in Unemployment Services,
LLC by TALX UCM Services, Inc. dated November 1, 2005; the Security Agreement
dated December 15, 2005, by TALX Tax Credits and Incentives, LLC, a Missouri
limited liability company; the Guaranty of TALX Tax Credits and Incentives, LLC,
a Missouri limited liability company, dated December 15, 2005; the Collateral
Assignment of Membership Interest in TALX Tax Credits and Incentives, LLC by
TALX Corporation dated December 15, 2005; the Security Agreement dated December
15, 2005, by Management Insight Incentives, LLC, a Missouri limited liability
company; the Guaranty of Management Insight Incentives, LLC, a Missouri limited
liability company, dated December 15, 2005; and the Collateral Assignment of
Membership Interest in Management Insight Incentives, LLC by TALX Tax Credits
and Incentives, LLC dated December 15, 2005; and any other loan document
executed and delivered to Administrative Agent for the benefit of Lenders."
xi) The definition of "INCREMENTAL COMMITMENT" is hereby added as
follows:
"INCREMENTAL COMMITMENT - means with respect to each Lender, such Lender's
share of the Aggregate Incremental Commitment as set forth opposite such
Lender's name on the table set forth on Exhibit 3 hereto entitled
"Incremental Commitments."
xii) The definition of "LENDER INCREASE NOTICE" is hereby added
as follows:
"LENDER INCREASE NOTICE -- is defined in Section 3.4.2."
xiii) The definition of "NET CASH PROCEEDS" is hereby added as
follows:
"NET CASH PROCEEDS - means, with respect to any issuance of Parity Debt or
stock by the Borrower, the amount of cash received by the Borrower from
such transaction after payment of all brokerage commissions and all other
ordinary and reasonable fees and expenses and commissions related to such
transaction."
xiv) The definition of "PARITY DEBT" is hereby added as follows:
11
"PARITY DEBT -- is defined in Section 15.2.9."
xv) The definition of "PRIOR ACQUISITION" is hereby added as
follows:
"PRIOR ACQUISITION - means the acquisition of the assets or stock or Xxxxx
& Xxxxx Consultants, LLC, Xxx-Xxx Associates, Inc., Employers Unity, Inc.
and Business Incentives, Inc."
xvi) The definition of "PROPOSED NEW LENDER" is hereby added as
follows:
"PROPOSED NEW LENDER -- is defined in Section 3.4.3."
xvii) The definition of "PRO-RATA SHARE" is hereby amended and
restated in its entirety as follows:
"PRO-RATA SHARE -- with respect to each Lender's obligation to make
Revolving Loans, participate in Letters of Credit, reimburse the Letter of
Credit Issuer, and receive payments of principal, interest, fees, costs,
and expenses with respect thereto, the applicable percentage determined as
follows:
1. With respect to an Aggregate Revolving Loan of less than or equal to
$150,000,000, the applicable percentage determined as follows:
(x) prior to the Aggregate Revolving Loan Commitment being terminated
or reduced to zero, the percentage obtained by dividing (i) such
Lender's Base Commitment, by (ii) the Aggregate Base Commitment; and
(y) from and after the time the Aggregate Revolving Loan Commitment
has been terminated or reduced to zero, the percentage obtained by
dividing (i) the sum of the aggregate unpaid principal amount of such
Lender's Revolving Loans (after settlement and repayment of all
Swingline Loans by the Lenders) and such Lender's Letter of Credit
Exposure, by (ii) the sum of the aggregate unpaid principal amounts of
all Revolving Loans (after settlement and repayment of all Swingline
Loans by the Lenders) and the aggregate Letter of Credit Exposure; and
2. With respect to an Aggregate Revolving Loan of greater than
$150,000,000, the applicable percentage determined as follows:
(x) prior to the Aggregate Revolving Loan Commitment being terminated
or reduced to zero:
(I) with respect to up to $150,000,000 of the Aggregate Revolving
Loan, the percentage obtained by dividing (a) such Lender's Base
Commitment, by (b) the Aggregate Base Commitment; and
12
(II) with respect to that portion of the Aggregate Revolving Loan
in excess of $150,000,000, the percentage obtained by dividing
(a) such Lender's Incremental Commitment, by (b) the Aggregate
Incremental Commitment; and
(y) from and after the time the Aggregate Revolving Loan Commitment
has been terminated or reduced to zero:
(I) with respect to up to $150,000,000 of the Aggregate Revolving
Loan, the percentage obtained by dividing (i) the sum of the
aggregate unpaid principal amount of such Lender's Revolving
Loans (after settlement and repayment of all Swingline Loans by
the Lenders) and such Lender's Letter of Credit Exposure up to
the amount of such Lender's Base Commitment, by (ii) the sum of
the aggregate unpaid principal amounts of all Revolving Loans
(after settlement and repayment of all Swingline Loans by the
Lenders) and the aggregate Letter of Credit Exposure up to the
Aggregate Base Commitment; and
(II) with respect to that portion of the Aggregate Revolving Loan
in excess of $150,000,000, the percentage obtained by dividing
(i) the sum of the aggregate unpaid principal amount of such
Lender's Revolving Loans (after settlement and repayment of all
Swingline Loans by the Lenders) and such Lender's Letter of
Credit Exposure in excess of such Lender's Base Commitment, by
(ii) the sum of the aggregate unpaid principal amounts of all
Revolving Loans (after settlement and repayment of all Swingline
Loans by the Lenders) and the aggregate Letter of Credit Exposure
in excess of the Aggregate Base Commitment.
3. Upon the effectiveness of any increase in the Aggregate Revolving Loan
Commitment pursuant to Section 3.4, each Lender's "Pro-Rata Share" shall be
determined in accordance with Section 3.4.4 based upon such Lender's
Effective Commitment Amount."
xviii) The definition of "SECOND AMENDMENT" is hereby added as
follows:
"SECOND AMENDMENT -- is defined in Section 5.8."
xix) The definition of "SECOND AMENDMENT EFFECTIVE DATE" is
hereby added as follows:
"SECOND AMENDMENT EFFECTIVE DATE - means the date on which the Second
Amendment becomes effective pursuant to Section 2 thereof."
xx) The definition of "SECURITY AGREEMENT" shall be revised to
include the following language in such definition: "Security Agreement dated
November 1, 2005, executed by Unemployment Services, LLC, a Missouri limited
liability company; the Security Agreement dated December 15, 2005, by TALX Tax
Credits and Incentives, LLC, a
13
Missouri limited liability company; and the Security Agreement dated December
15, 2005, by Management Insight Incentives, LLC, a Missouri limited liability
company."
xxi) The definition of "SELLING LENDER(S)" is hereby added as
follows:
"SELLING LENDER(S) -- is defined in Section 3.4.4."
p) LENDERS, LENDER'S COMMITMENTS AND PRO-RATA SHARES. Exhibit 3 to the
Second Amended and Restated Loan Agreement shall be amended and restated in its
entirety as follows:
BASE COMMITMENTS
LENDER BASE COMMITMENT
------ ---------------
LaSalle Bank National Association $ 45,000,000
Southwest Bank of St. Louis $ 35,000,000
National City Bank of the Midwest $ 25,000,000
Fifth Third Bank $ 17,500,000
Xxxxxxx Xxxxx Capital, a Division of
Xxxxxxx Xxxxx Business Financial Services Inc. $ 17,500,000
First Bank $ 10,000,000
AGGREGATE BASE COMMITMENT $150,000,000.00
INCREMENTAL COMMITMENTS
LENDER INCREMENTAL COMMITMENT
------ ----------------------
LaSalle Bank National Association $ 10,000,000
Southwest Bank of St. Louis $ 8,750,000
National City Bank of the Midwest $ 8,750,000
Fifth Third Bank $ 8,750,000
First Bank $ 8,750,000
14
INCREMENTAL COMMITMENTS
LENDER INCREMENTAL COMMITMENT
------ ----------------------
Xxxxxxx Xxxxx Capital, a Division of
Xxxxxxx Xxxxx Business Financial Services Inc. $ 5,000,000
AGGREGATE INCREMENTAL COMMITMENT $50,000,000.00
q) COMMITMENT AND ACCEPTANCE. A new Exhibit 3.4.1 to the Second
Amended and Restated Loan Agreement shall added in the form of the attached
Exhibit 3.4.1.
r) COMPLIANCE CERTIFICATE. Schedule II to the Compliance Certificate
attached as Exhibit 14.14 to the Second Amended and Restated Loan Agreement
shall be replaced in its entirety with the attached Schedule II to Exhibit
14.14.
s) TOTAL INDEBTEDNESS TO EBITDA. For purposes of calculating the Base
Rate Margin, the Eurodollar Margin and the Letter of Credit Fee pursuant to the
terms of the Second Amended and Restated Loan Agreement, as of the date on which
this Amendment becomes effective in accordance with Section 2 hereof, Borrower's
ratio of Total Indebtedness to EBITDA is hereby agreed to be greater than 2.00
to 1. Thereafter, and commencing with the quarter ending June 30, 2006, the
applicable Margins shall be re-determined by Administrative Agent promptly after
each delivery by Borrower to Administrative Agent of Borrower's Financial
Statements (and accompanying Compliance Certificate) as required in Section
14.14.2 of the Second Amended and Restated Loan Agreement, and will become
applicable on the third Business Day following the day when Borrower delivers
such Financial Statements (and accompanying Compliance Certificate) to
Administrative Agent.
t) CHANGE OF ADDRESS. For all purposes under the Second Amended and
Restated Loan Agreement and each other Loan Document, the address of the chief
executive office of each Covered Person and the address for any notice delivered
to a Covered Person pursuant to any Loan Document shall be as follows:
00000 Xxxxxxxx Xxxx
Xx. Xxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx
Notices to include a copy to:
Xxxxx Xxxx LLP
Xxx Xxxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attention: R. Xxxxxxx Xxxx and Xxxxx X. Xxxxx
In connection with the foregoing change, each Covered Person hereby authorizes
the
15
Administrative Agent to prepare and file such UCC financing statements as are
necessary to amend the UCC financing statements previously filed in connection
with the Security Interests granted pursuant to the Loan Documents.
2. CONDITIONS PRECEDENT TO AMENDMENT.
As a condition precedent to Lenders' consent to the amendments as described
herein and to the effectiveness of this Amendment, the following must have been
satisfied:
a) This Agreement. Borrower, each Guarantor, and each Lender shall
have executed and delivered this Amendment to Administrative Agent's possession
and Borrower shall have paid to the Administrative Agent all fees related to
this Amendment.
b) Revolving Notes. Borrower shall have executed and delivered the
following Revolving Notes to the Administrative Agent in substitution of the
Revolving Loan Notes issued by the Borrower to each Lender on November 1, 2005
(other than in the case of MLC with respect to which a new Revolving Note will
not be issued and the existing Amended and Restated Revolving Note dated
November 1, 2005 in the amount of $17,500,000 payable to MLC shall remain in
effect):
(i) Amended and Restated Revolving Note in the principal amount
of $55,000,000 from Borrower in favor of LBNA;
(ii) Amended and Restated Revolving Note in the principal amount
of $43,750,000 from Borrower in favor of SWB;
(iii) Amended and Restated Revolving Note in the principal amount
of $33,750,000 from Borrower in favor of NCB;
(iv) Amended and Restated Revolving Note in the principal amount
of $26,250,000 from Borrower in favor of FTB;
(v) Amended and Restated Revolving Note in the principal amount
of $18,750,000 from Borrower in favor of FB; and
(vi) Amended and Restated Revolving Note in the principal amount
of $22,500,000 from Borrower in favor of MLC.
c) Other Loan Documents. The Administrative Agent shall have received
such consents, approvals, opinions, certificates, documents and information as
Administrative Agent deems necessary.
d) Representations and Warranties. Except as set forth on Schedule I
hereto, the Representations and Warranties set forth in Section 12 of the Second
Amended and Restated Loan Agreement shall be true and correct as of the date of
this Amendment.
e) Compliance with Loan Documents. The Borrower and each Guarantor
shall be in full compliance with all of the terms and conditions of the Loan
Documents, and there
16
shall be no Existing Default thereunder, and no Default or Event of Default
shall have occurred and be continuing thereunder or shall result after giving
effect to this Amendment.
f) Closing of Approved Acquisition. The Administrative Agent shall be
satisfied that all material requirements to close the Approved Acquisition shall
have been satisfied or waived by the parties to the Approved Acquisition
Documents, except for the payment of the purchase price.
3. MISCELLANEOUS.
a) Loan Documents Continue. Except as specifically amended by this
Amendment, all of the terms, provisions, conditions, agreements, covenants,
representations, warranties and powers contained in the Loan Documents shall be
and remain in full force and effect and the same are hereby ratified and
confirmed and are incorporated herein by reference. Reference to this Amendment
need not be made in any note, document, letter, certificate, Loan Documents, or
any communication issued or made pursuant to or with respect to the Loan
Documents; any reference to the Loan Documents being sufficient to refer to the
Loan Documents as amended hereby. In no manner shall this Amendment impair the
Loan Documents, the rights, remedies obligations, liabilities, liens or security
interests represented thereby, nor shall any such rights, remedies, obligations,
liabilities, liens or security interests be in any manner waived or impaired,
diminished or discharged hereby.
b) Counterparts. This Amendment may be executed by the parties hereto
on any number of separate counterparts, and all such counterparts taken together
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Amendment to produce or account for more than one
counterpart signed by the party to be charged.
(Signatures of Borrower, Guarantors, and Lenders are on the following pages.)
17
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the
date first written above.
LASALLE BANK NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT AND A LENDER
By: /s/ Xxx Xxxxxx
------------------------------------
Print Name: Xxx Xxxxxx
Title: Senior Vice President
18
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the
date first written above.
SOUTHWEST BANK OF ST. LOUIS,
AS A LENDER
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Print Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
19
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the
date first written above.
NATIONAL CITY BANK OF THE MIDWEST,
AS A LENDER
By: /s/ Xxxx Xxxxxxx
------------------------------------
Print Name: Xxxx Xxxxxxx
Title: Vice President
20
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the
date first written above.
FIFTH THIRD BANK, AS A LENDER
By: /s/ Xxxxx X. Xxxxx
------------------------------------
Print Name: Xxxxx X. Xxxxx
Title: Vice President
21
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the
date first written above.
XXXXXXX XXXXX CAPITAL, A DIVISION
OF XXXXXXX XXXXX BUSINESS
FINANCIAL SERVICES INC., AS A LENDER
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Print Name: Xxxxxxx X. Xxxxxx
Title: Vice President
22
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the
date first written above.
FIRST BANK, AS A LENDER
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------
Print Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President
23
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the
date first written above.
BORROWER:
TALX CORPORATION, A MISSOURI CORPORATION,
AS BORROWER
By: /s/ L. Xxxxx Xxxxxx
-------------------------------------
Print Name: L. Xxxxx Xxxxxx
Title: Chief Financial Officer
24
ACKNOWLEDGEMENT AND CONSENT OF GUARANTORS
Each Guarantor (i) acknowledges the amendments to the Second Amended and
Restated Loan Agreement as set forth in this Amendment; (ii) consents to the
execution of this Amendment by the Borrower, (iii) acknowledges that this
consent is not required under the terms of its Guaranty and that the execution
hereof by the Guarantor shall not be construed to require the Lenders to obtain
its acknowledgment to any future amendment, modification or waiver of any term
of the Agreement except as otherwise provided in said Guaranty, and (iv)
acknowledges that it shall be bound by the terms of the Second Amended and
Restated Credit Agreement as amended by this Amendment. Each Guarantor hereby
agrees that the Guaranty with respect to which it is a party shall apply,
without limitation, to all indebtedness, obligations and liabilities of the
Borrower under the Second Amended and Restated Loan Agreement as amended by this
Amendment and that such Guaranty shall be and remain in full force and effect.
TALX UCM SERVICES, INC., A MISSOURI TALX FASTIME SERVICES, INC., A TEXAS
CORPORATION, AS A GUARANTOR CORPORATION, AS A GUARANTOR
By: /s/ L. Xxxxx Xxxxxx By: /s/ L. Xxxxx Xxxxxx
--------------------------------- ------------------------------------
Name: L. Xxxxx Xxxxxx Name: L. Xxxxx Xxxxxx
Title: Chief Financial Officer Title: Chief Financial Officer
TALX EMPLOYER SERVICES, LLC, A UI ADVANTAGE, INC., A MARYLAND
MISSOURI LIMITED LIABILITY COMPANY, CORPORATION, AS A GUARANTOR
AS A GUARANTOR
By: /s/ L. Xxxxx Xxxxxx By: /s/ L. Xxxxx Xxxxxx
--------------------------------- ------------------------------------
Name: L. Xxxxx Xxxxxx Name: L. Xxxxx Xxxxxx
Title: Chief Financial Officer Title: Chief Financial Officer
TBT ENTERPRISES, INCORPORATED, A NET PROFIT, INC., A SOUTH CAROLINA
MARYLAND CORPORATION, AS A GUARANTOR CORPORATION, AS A GUARANTOR
By: /s/ L. Xxxxx Xxxxxx By: /s/ L. Xxxxx Xxxxxx
--------------------------------- ------------------------------------
Name: L. Xxxxx Xxxxxx Name: L. Xxxxx Xxxxxx
Title: Chief Financial Officer Title: Chief Financial Officer
TALX TAX INCENTIVE SERVICES, LLC, A XXX-XXX ASSOCIATES, INC., A
MISSOURI LIMITED LIABILITY COMPANY, MASSACHUSETTS CORPORATION, AS A
AS A GUARANTOR GUARANTOR
By: /s/ L. Xxxxx Xxxxxx By: /s/ L. Xxxxx Xxxxxx
--------------------------------- ------------------------------------
Name: L. Xxxxx Xxxxxx Name: L. Xxxxx Xxxxxx
Title: Chief Financial Officer Title: Chief Financial Officer
TALX TAX CREDITS AND INCENTIVES, LLC, MANAGEMENT INSIGHT INCENTIVES, LLC, A
A MISSOURI LIMITED LIABILITY COMPANY, MISSOURI LIMITED LIABILITY COMPANY,
AS A GUARANTOR AS A GUARANTOR
By: /s/ L. Xxxxx Xxxxxx By: /s/ L. Xxxxx Xxxxxx
--------------------------------- ------------------------------------
Name: L. Xxxxx Xxxxxx Name: L. Xxxxx Xxxxxx
Title: Chief Financial Officer Title: Chief Financial Officer
UNEMPLOYMENT SERVICES, LLC, A
MISSOURI LIMITED LIABILITY COMPANY,
AS A GUARANTOR
By: /s/ L. Xxxxx Xxxxxx
---------------------------------
Name: L. Xxxxx Xxxxxx
Title: Chief Financial Officer
25
EXHIBIT 3.4.1
COMMITMENT AND ACCEPTANCE
Date _________
LaSalle Bank National Association
Xxx Xxxxx Xxxxxxxxx, Xxxxx 000
Xx. Xxxxx, Xxxxxxxx 00000
Attention: [____________]
Ladies and Gentlemen:
Reference is hereby made to that certain Second Amended and Restated Loan
Agreement dated April 14, 2005 by and among TALX Corporation, as Borrower, the
Guarantors signatory thereto, the financial institutions party thereto as
Lenders and LaSalle Bank National Association, in its individual capacity as a
Lender and as Agent (as amended, restated, supplemented or otherwise modified,
the "Loan Agreement"). Defined terms used herein and not otherwise defined
herein shall have the meanings given to them in the Loan Agreement.
Pursuant to Section 3.4.1 of the Loan Agreement, the Borrower has requested
an increase in the Aggregate Revolving Loan Commitment in the amount of
$__________ from $____________ to $____________. Such increase in the Aggregate
Revolving Loan Commitment is to become effective on the date (the "Effective
Date") which is the later of (i) __________, _____ and (ii) the date on which
the conditions precedent set forth in Section 3.4.1 in respect of such increase
have been satisfied. In connection with such requested increase in the Aggregate
Revolving Loan Commitment, the Administrative Agent and _______________ (the
"Accepting Bank") hereby agree as follows:
1. Effective as of the Effective Date, the Accepting Bank shall become a
party to the Loan Agreement as a Lender and shall have all of the rights and
obligations of a Lender thereunder and shall thereupon have a [Revolving Loan
Commitment under and for purposes of the Loan Agreement in an amount equal to
the] or [the Revolving Loan Commitment of the Accepting Bank under the Loan
Agreement shall be increased from $_________ to the] amount set forth opposite
the Accepting Bank's name on the signature page hereof.
2. The Accepting Bank hereby (i) confirms that it has received a copy of
the Loan Agreement, together with copies of such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into this Commitment and Acceptance agreement; (ii) agrees that it will,
independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it shall deemed
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Agreement; (iii) appoints and authorizes the
Administrative Agent to take such action as contractual representative on its
behalf and to exercise such powers under
26
the Loan Agreement and the other Loan Documents as are delegated to the
Administrative Agent by the terms thereof, together with such powers as are
reasonably incidental thereto; and (iv) agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Agreement are required to be performed by it as a Lender.
Revolving Loan Commitment: [Name of Lender]
$_____________________
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
LASALLE BANK NATIONAL ASSOCIATION,
as Administrative Agent
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
TALX CORPORATION,
as Borrower
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
27
SCHEDULE II TO COMPLIANCE CERTIFICATE
All calculations done in accordance with GAAP on a consolidated basis, in
accordance with the provisions of the Second Amended and Restated Loan Agreement
and based on the period ended __________________. Any inconsistencies between
the descriptions of the items set forth in this Schedule II and the terms of any
of Sections 16.1 through 16.6 shall be resolved in favor of the terms set forth
in Sections 16.1 through 16.6. Reference should be made to Sections 16.1 through
16.6 of the Second Amended and Restated Loan Agreement for more specific
instructions regarding the calculation periods and how the components of the
financial covenants should be calculated.
I. EBITDA (for preceding four fiscal quarters) (Section 16.1):
(i) Net Income $_________
(ii) Interest Expense $_________
(iii) Federal, State and Local Income Tax expense accrued for as a
liability $_________
(iv) Amortization of good will and other intangible assets and
depreciation expense taken or accrued for in such period,
without duplication $_________
(v) Extraordinary losses in such period incurred or accrued for in
such period, without duplication $_________
(vi) Share based compensation expense $_________
(vii) Sums related to consummation of Approved Acquisition
($2,700,000.00, $1,675,000.00, $650,000.00, or $325,000.00, if
applicable) $_________
(viii) Sum of Items (i) through (vii) $_________
(ix) Extraordinary income/gain in such period incurred or accrued
for in such period, without duplication $_________
(x) Items (viii) minus Item (ix) -- EBITDA $_________
II. EBIT (for preceding four fiscal quarters) (Section 16.1):
(i) Net Income $_________
(ii) Interest Expense $_________
28
(iii) Federal, State and Local Income Tax expense accrued for as a
liability $_________
(iv) Share based compensation expense $_________
(v) Sums related to consummation of Approved Acquisition
($2,700,000.00, $1,675,000.00, $650,000.00, or $325,000.00, if
applicable) $_________
(vi) Sum of Items (i) through (v) - EBIT $_________
III. MINIMUM INTEREST COVERAGE (for preceding four fiscal quarters) (Section 16.3)
A. EBIT (for preceding four fiscal quarters per Item II (vi)) $_________
Less: (i) Dividends $_________
(ii) Federal, State and Local Income Tax expense accrued
for as a liability $_________
B. Subtotal (EBIT minus (i) and (ii)) $_________
C. Interest Expense $_________
D. Ratio of Item B to Item C ____: 1.0
E. Minimum ratio required by Section 16.3: 2.0 to 1.
IV. TOTAL INDEBTEDNESS TO EBITDA (for preceding four fiscal quarters) (Section 16.4)
A. Total Indebtedness $_________
B. EBITDA (for preceding four fiscal quarters per Item I (xiii)) $_________
C. Ratio of Item A to Item B ____: 1.0
D. Maximum Ratio of Total Indebtedness to EBITDA permitted by Section
16.4: 2.50 to 1; provided that, notwithstanding the foregoing, for
the fiscal quarters ending June 30, 2006 and September 30, 2006, the
Borrower's ratio of Total Indebtedness to EBITDA shall not be greater
than 2.75 to 1.
29
V. MINIMUM EBITDA (for preceding four fiscal quarters) (Section 16.6)
A. EBITDA (for preceding four fiscal quarters per Item 1 (xiii)) $_________
B. 75% EBITDA of Permitted Acquisitions $_________
C. Minimum EBITDA required by Section 16.6: commencing with the quarter
ending June 30, 2006, $60,400,000 plus 75% EBITDA of Permitted
Acquisitions $_________
30
