Exhibit 99.3
FIFTH AMENDMENT TO CREDIT AGREEMENT
AND AMENDMENT TO FORBEARANCE AGREEMENT
This Fifth Amendment to Credit Agreement and Amendment to Forbearance
Agreement, dated as of May 31, 2002 (this "Amendment"), is among XXXX
INDUSTRIES, INC., a Delaware corporation (the "Parent"), each of the
Parent's domestic Subsidiaries, as borrowers (together with the Parent,
collectively the "Borrowers"), the Parent and each of the Parent's domestic
Subsidiaries, as guarantors (the "Guarantors" and each a "Guarantor", and
together with the Borrowers, collectively the "Credit Parties" and each a
"Credit Party"), LASALLE BANK NATIONAL ASSOCIATION, as lender ("LaSalle"),
NATIONAL CITY BANK, as lender ("NCB"), U.S. Bank (successor by merger to
Firstar Bank), as lender ("US Bank"), Comerica Bank, as lender
("Comerica"), Associated Bank, N.A., as lender ("Associated Bank", and
together with LaSalle, NCB, US Bank and Comerica, collectively the
"Lenders"), LaSalle, as administrative agent for the Lenders (in such
capacity, the "Administrative Agent"), and NCB, as syndication agent for
the Lenders (in such capacity, the "Syndication Agent", and together with
the Administrative Agent, the "Agents"). Capitalized terms used in this
Amendment and not otherwise defined have the meanings assigned to such
terms in the Credit Agreement (as defined below).
PRELIMINARY STATEMENTS:
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1. The Credit Parties and the Lenders are parties to the Credit
Agreement dated as of March 8, 2001 (as such agreement may be amended,
restated, supplemented or otherwise modified from time to time, the "Credit
Agreement"), under which the Lenders provided the Borrowers with, among
other things, a $65,000,000 credit facility.
2. The Credit Parties and the Lenders are parties to the Forbearance
Agreement dated as of April 25, 2002 (as such agreement may be amended,
restated, supplemented or otherwise modified from time to time, the
"Forbearance Agreement"), pursuant to which the Lenders agreed to forbear
until May 31, 2002 from exercising their rights under the Credit Agreement
related to the Credit Parties' failure to comply with Section 10.6(E) of
the Credit Agreement.
3. The Lenders have extended credit to the Borrowers under the Credit
Agreement as evidenced by, among other things, the Notes evidencing the
Revolving Loan dated as of November 19, 2001 and made by the Borrowers in
favor of the Lenders in the aggregate principal amount of $35,000,000 (the
"Existing Revolving Loan Notes") and the Notes evidencing the Term Loan
dated as of January 8, 2002 and made by the Borrowers in favor of the
Lenders in the aggregate principal amount of $30,000,000..
4. The Borrowers and the Lenders desire to amend and restate the
Existing Revolving Loan Notes to decrease the maximum commitment to
$25,000,000.
5. The Credit Parties and the Lenders desire to amend the Credit
Agreement to, among other things, incorporate the amendments to the
Existing Revolving Loan Notes and add a collateral monitoring fee payable
by the Borrowers, all on the terms, and subject to the conditions, of this
Amendment.
6. For the four consecutive months ending April 30, 2002, the Credit
Parties failed to comply with Section 10.6(E) of the Credit Agreement. On
such date, this violation constituted an Event of Default under the Credit
Agreement, and such Event of Default has been existing since April 30,
2002.
7. The Credit Parties have requested that the Lenders extend the
forbearance period under the Forbearance Agreement until June 30, 2002 from
exercising their rights under the Credit Agreement and the other Loan
Documents with respect to such Event of Default, and the Lenders have
agreed to such request subject to the terms and conditions of this
Amendment.
AGREEMENT:
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In consideration of the mutual agreements contained in this Amendment,
and other good and valuable consideration the receipt and sufficiency of
which are acknowledged, the parties to this Amendment agree as follows:
SECTION 1. AMENDMENT TO CREDIT AGREEMENT.
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1.1 On the date this Amendment becomes effective, after satisfaction
by the Credit Parties of each of the conditions set forth in Section 8 (the
"Effective Date"), Section 1.1 of the Credit Agreement is amended by
deleting the definition of "Revolving Commitment Amount" in its entirety
and replacing it as follows:
Revolving Commitment Amount means $25,000,000, as such amount may
be reduced from time to time pursuant to Section 6.1 of this
Agreement.
1.2 On the Effective Date, Section 5 of the Credit Agreement is
amended by adding a new Section 5.4 to such Section as follows:
5.4 Collateral Monitoring Fee. The Borrowers agree to pay to the
Administrative Agent for the Account of LaSalle Business Credit, Inc.
a collateral monitoring fee in an amount equal to $10,000 on the first
Business Day of each month, commencing with the first Business Day of
June 2002 and continuing thereafter.
SECTION 2. AMENDMENTS TO EXISTING REVOLVING LOAN NOTES.
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2.1 Amendment to Existing Revolving Loan Notes. On the Effective Date,
the Notes evidencing the Revolving Loans shall be amended, restated and
replaced in their entirety by the Third Amended and Restated Revolving
Notes of even date with this Amendment (the "Third Amended Revolving
Notes"), made by the Borrowers in favor of the Lenders in the original
aggregate principal amount of $25,000,000.
2.2 Return of Existing Revolving Loan Notes. After receipt of its
Third Amended Revolving Note, each Lender will xxxx its respective Existing
Revolving Loan Note evidencing such Lender's Percentage of the Revolving
Commitment Amount "superceded" and return it to the Borrowers.
SECTION 3. AMENDMENTS TO SCHEDULE.
----------------------
On the Effective Date, Schedule 2.1(A) to the Credit Agreement is
deleted and replaced in its entirety with Schedule 2.1(A) to this
Amendment.
SECTION 4. ACKNOWLEDGMENT OF THE BORROWER.
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4.1 Outstanding Balance. As of the date of this Amendment, the Credit
Parties acknowledge and agree that the Borrowers owe the Lenders an
aggregate principal amount of $36,716,918.65 under the Credit Agreement and
the other Loan Documents, plus accrued and unpaid interest, fees and other
expenses (if any). The Borrowers have made all payments under the Credit
Agreement and the other Loan Documents required to be made as of the date
hereof.
4.2 Default. The Credit Parties acknowledge that an Event of Default
has occurred and is continuing under Section 12.1(D) of the Credit
Agreement due to the Credit Parties' violation of the financial covenant
set forth in Section 10.6(E) of the Credit Agreement for the four
consecutive months ending April 30, 2002 (the "Existing Default").
SECTION 5. FORBEARANCE.
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5.1 Forbearance. During the Forbearance Period (as defined below), the
Lenders will not exercise any of their rights or remedies under the Credit
Agreement, the Loan Documents or applicable law with respect to the
Existing Default. For purposes of this Amendment, "Forbearance Period"
means the period commencing on the Effective Date and ending on the earlier
of (a) June 30, 2002 and (b) the date the Forbearance Period is terminated
upon the occurrence of any of the events described in Section 5.3 (the
"Termination Date").
5.2 Interest Rates. Notwithstanding the terms of the Credit Agreement,
the Borrowers acknowledge and agree that, during the Forbearance Period,
the Borrowers shall pay interest on the unpaid principal amount of each
Loan (a) at all times while such Loan is a Base Rate Loan at a rate per
annum equal to the sum of the Base Rate from time to time in effect plus
1.75% and (b) at all times while such Loan is a Eurodollar Loan at a rate
per annum equal to the sum of the Eurodollar Rate (Reserve Adjusted) plus
4.00%.
5.3 Termination of Forbearance. Upon the occurrence of any Termination
Event (as defined below) and at any time after such occurrence during which
a Termination Event is continuing, the Agents are entitled to, without
prior notice to the Credit Parties, immediately terminate the Forbearance
Period, unless such Termination Event is an Event of Default described in
Section 12.1(C) of the Credit Agreement, in which case the Forbearance
Period automatically terminates without demand or notice of any kind. For
purposes of this Amendment, "Termination Event" means:
(A) the occurrence of an Event of Default under the Credit
Agreement (other than the Existing Default); or
(B) any representation or warranty made by the Credit Parties
under this Amendment or any agreement, instrument or other document
executed or delivered by the Credit Parties in connection with this
Amendment is untrue or incorrect in any respect when made or any
schedule, certificate, statement, report, financial data, notice or
writing furnished at any time by the Credit Parties to the Agents or
any Lender is untrue or incorrect in any respect on the date as of
which the facts set forth therein are stated or certified.
5.4 Effect at End of Forbearance Period. On the Termination Date, the
Existing Default will be deemed to exist and, without regard to any matters
transpiring during the Forbearance Period or the financial condition or
prospects of the Credit Parties as of such date, the Agent and each Lender
shall be fully entitled to exercise any rights and remedies they may have
under the Credit Agreement, the other Loan Documents or applicable law.
5.5 ACKNOWLEDGMENT. THE CREDIT PARTIES EXPRESSLY ACKNOWLEDGE AND AGREE
THAT THE FORBEARANCE PROVISION SET FORTH IN SECTION 4.1 IS EFFECTIVE ONLY
DURING THE FORBEARANCE PERIOD AND THAT, AFTER THE TERMINATION DATE, THE
CREDIT AGREEMENT WILL BE IN MATERIAL DEFAULT AND THE LENDERS WILL BE FULLY
ENTITLED IMMEDIATELY TO EXERCISE THEIR RIGHTS AND REMEDIES UNDER THE CREDIT
AGREEMENT, THE LOAN DOCUMENTS OR APPLICABLE LAW WITHOUT REGARD TO ANY
MATTERS TRANSPIRING DURING THE FORBEARANCE PERIOD OR THE FINANCIAL
CONDITION OR PROSPECTS OF THE CREDIT PARTIES. THE CREDIT PARTIES UNDERSTAND
THAT THE LENDERS ARE EXPRESSLY RELYING ON THE TERMS OF THIS SECTION 5.5 AND
WOULD NOT HAVE ENTERED INTO THIS AMENDMENT BUT FOR THE CREDIT PARTIES'
ACKNOWLEDGMENT AND AGREEMENT IN THIS SECTION 5.5.
5.6 No Waiver. Nothing in this Amendment shall in any way be deemed to
be (a) a waiver of any Event of Default including the Existing Default or
(b) an agreement to forbear from exercising any remedies with respect to
any Event of Default except as specifically set forth in Section 5.1.
SECTION 6. FURTHER ASSURANCES OF THE BORROWERS.
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The Credit Parties agree that at any time and from time to time, at
the cost and expense of the Credit Parties, the Credit Parties will (a)
execute and deliver all further instruments and documents, and take all
further action, that may be reasonably necessary to complete the
transactions contemplated by this Amendment and (b) cooperate fully with
the Agents' or any Lender's personnel and representatives with respect to
any reasonable request for information by such personnel and
representatives.
SECTION 7. REPRESENTATIONS AND WARRANTIES.
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To induce the Lenders to enter into this Amendment, the Credit Parties
represent and warrant to the Lenders that:
7.1 Due Authorization; No Conflict; No Lien; Enforceable Obligation.
The execution, delivery and performance by each Credit Party of this
Amendment are within its corporate powers, have been duly authorized by all
necessary corporate action, have received all necessary governmental,
regulatory or other approvals (if any is required), do not and will not
contravene or conflict with any provision of (a) any law, (b) any judgment,
decree or order or (c) its articles or certificate of incorporation, bylaws
or trust documents and do not and will not contravene or conflict with, or
cause any lien to arise under, any provision of any agreement or instrument
binding upon any Credit Party or upon any of its property. This Amendment,
the Credit Agreement, as heretofore amended and as amended by this
Amendment, and the Notes, as amended by this Amendment, are the legal,
valid and binding obligations of each Credit Party, enforceable against it
in accordance with its respective terms.
7.2 Representations and Warranties; Default. As of the Effective Date,
except for those representations or warranties specifically made as of
another date or relating to the Existing Default, the representations and
warranties of the Credit Parties contained in the Credit Agreement are true
and correct. As of the Effective Date, except for the Existing Default, no
Default or Event of Default has occurred and is continuing.
SECTION 8. CONDITIONS PRECEDENT.
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Notwithstanding any other provision contained in this Amendment, the
effectiveness of this Amendment and the obligation of the Lenders to
institute the forbearance contemplated by this Amendment and the
commencement of the Forbearance Period are subject to the following:
8.1 Documents and Fees. The Administrative Agent has received all of
the following, each duly executed and dated, or received, by such date as
is satisfactory to the Agents in form and substance satisfactory to the
Agents:
(A) Fifth Amendment to Credit Agreement and Amendment to
Forbearance Agreement. This Amendment;
(B) Consents. Certified copies of all documents evidencing any
necessary corporate consents and governmental approvals, if
any, with respect to this Amendment;
(C) Costs and Expenses. All reasonable out-of-pocket costs and
expenses to the Agents, including the reasonable fees and
out-of-pocket charges of counsel for the Agents;
(D) Amendment Fee. The Borrowers shall pay a fee to the
Administrative Agent for the account of each Lender party to
this Amendment in the amount equal to the product of each
such Lender's Percentage times $22,500; and
(E) Other. Such other documents as the Administrative Agent may
reasonably request.
8.2 Representations and Warranties. The representations and warranties
of the Credit Parties set forth in this Amendment are true and correct.
SECTION 9. MISCELLANEOUS.
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9.1 Captions. The recitals to this Amendment (except for definitions)
and the section captions used in this Amendment are for convenience only
and do not affect the construction of this Amendment.
9.2 Governing Law; Severability. THIS AMENDMENT IS A CONTRACT MADE
UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF ILLINOIS. Wherever
possible, each provision of this Amendment will be interpreted in such
manner as to be effective and valid under applicable law, but if any
provision of this Amendment is prohibited by or invalid under such law,
such provision will be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Amendment.
9.3 Counterparts. This Amendment may be executed in any number of
counterparts and by the different parties on separate counterparts and each
such counterpart will be deemed to be an original, but all such
counterparts together constitute but one and the same Amendment.
9.4 Successors and Assigns. This Amendment is binding upon the Credit
Parties, the Lenders and their respective successors and assigns, and
inures to the sole benefit of the Credit Parties, the Lenders and their
successors and assigns. The Credit Parties have no right to assign their
rights or delegate their duties under this Amendment.
9.5 Continued Effectiveness. Notwithstanding anything contained in
this Amendment, the terms of this Amendment are not intended to and do not
serve to effect a novation as to the Credit Agreement or any other Loan
Document. The parties to this Amendment expressly do not intend to
extinguish the Credit Agreement or any other Loan Document. Instead, the
parties to this Amendment expressly intend to reaffirm the indebtedness
created under the Credit Agreement and the other Loan Documents. The Credit
Agreement and the other Loan Documents remain in full force and effect and
the terms and provisions of the Credit Agreement and the other Loan
Documents are ratified and confirmed.
9.6 Tolling. Any and all statutes of limitations, repose or similar
legal constraints on the time by which a claim must be filed, a person
given notice thereof, or asserted, that expire, run or lapse during the
Forbearance Period on any claims that any Lender may have against the
Credit Parties or any other persons relating to any Credit Party
(collectively, the "Forbearance Period Statutes of Limitation") will be
tolled during the Forbearance Period. The Credit Parties waive any defense
they may have against the Lenders under the Forbearance Period Statutes of
Limitation, applicable law or otherwise solely as to the expiration,
running or lapsing of the Forbearance Period Statutes of Limitation during
the Forbearance Period.
9.7 Revival of Obligations. If all or any part of any payment under or
on account of the Credit Agreement, the other Loan Documents, this
Amendment or any agreement, instrument or other document executed or
delivered by the Credit Parties in connection with this Amendment is
invalidated, set aside, declared or found to be void or voidable or
required to be repaid to the issuer or to any trustee, custodian, receiver,
conservator, master, liquidator or any other person pursuant to any
bankruptcy law or pursuant to any common law or equitable cause then, to
the extent of such invalidation, set aside, voidness, voidability or
required repayment, such payment would be deemed to not have been paid, and
the obligations of the Credit Parties in respect thereof shall be
immediately and automatically revived without the necessity of any action
by the Lenders.
9.8 References. From and after the Effective Date, each reference in
the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein",
or words of like import, and each reference in the Credit Agreement or any
other Loan Document to the Credit Agreement, the Notes or to any term,
condition or provision contained "thereunder", "thereof", "therein", or
words of like import, mean and are a reference to the Credit Agreement or
the Notes (or such term, condition or provision, as applicable) as amended,
supplemented, restated or otherwise modified by this Amendment or the
Second Amended Notes, as applicable.
9.9 Costs, Expenses and Taxes. The Borrowers affirm and acknowledge
that Section 15.5 of the Credit Agreement applies to this Amendment and the
transactions and agreements and documents contemplated under this
Amendment.
9.10 Waiver of Jury Trial. Each of the Borrowers, the Agents and the
each Lender waives any right to a trial by jury in any action or proceeding
to enforce or defend any rights under this Agreement, and agrees that any
such action or proceeding shall be tried before a court and not before a
jury.
9.11 WAIVER OF CLAIMS. THE CREDIT PARTIES, IN EVERY CAPACITY,
INCLUDING, BUT NOT LIMITED TO, AS SHAREHOLDERS, PARTNERS, OFFICERS,
DIRECTORS, INVESTORS AND/OR CREDITORS OF ANY CREDIT PARTY, OR ANY ONE OR
MORE OF THEM, HEREBY WAIVE, DISCHARGE AND FOREVER RELEASE EACH AGENT AND
EACH LENDER AND THEIR RESPECTIVE EMPLOYEES, OFFICERS, DIRECTORS, ATTORNEYS,
STOCKHOLDERS AND SUCCESSORS AND ASSIGNS, FROM AND OF ANY AND ALL KNOWN
CLAIMS, CAUSES OF ACTION, DEFENSES, COUNTERCLAIMS OR OFFSETS AND/OR
ALLEGATIONS CREDIT PARTIES MAY HAVE OR MAY HAVE MADE OR WHICH ARE BASED ON
FACTS OR CIRCUMSTANCES OF WHICH ANY CREDIT PARTY HAS KNOWLEDGE ARISING AT
ANY TIME UP THROUGH AND INCLUDING THE DATE OF THIS AGREEMENT AGAINST ANY OR
ALL OF ANY AGENT, ANY LENDER, OR ANY OF THEIR RESPECTIVE EMPLOYEES,
OFFICERS, DIRECTORS, ATTORNEYS, STOCKHOLDERS AND SUCCESSORS AND ASSIGNS.
[Balance of page intentionally left blank.]
Delivered at Chicago, Illinois, as of the date and year first above
written.
CREDIT PARTIES:
XXXX INDUSTRIES, INC.
XXXX INSTALLATION SERVICES, INC.
XXXX ENCLOSURES, INC.
XXXX, INC.
XXXX PRODUCTS, INC.
XXXX CONSTRUCTION, INC.
FOLDING CARRIER CORP.
XXXX FOREIGN HOLDINGS, INC.
UNR REALTY, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxx
Title: President and Chief
Executive Officer
(for each of the foregoing entities)
LENDERS:
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx
Title: Vice President
NATIONAL CITY BANK
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx, Xx.
Title: Senior Vice President
U.S. BANK
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: Vice President
COMERICA BANK
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: Assistant Vice President
ASSOCIATED BANK, N.A.
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: Assistant Vice President
SCHEDULE 2.1(A): LENDERS AND PERCENTAGES
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REVOLVING LOAN COMMITMENTS
Lender Commitment Percentage
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LaSalle Bank National Association $6,666,666.66 26 2/3%
National City Bank $6,666,666.67 26 2/3%
Associated Bank, N.A. $4,166,666.67 16 2/3%
U.S. Bank $4,166,666.67 16 2/3%
Comerica Bank $3,333,333.33 13 1/3%
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TOTAL $25,000,000.00
AGGREGATE UNPAID PRINCIPAL AMOUNT OF TERM LOANS
AS OF MAY 31, 2002
Lender Aggregate Unpaid Term Loan Percentage
LaSalle Bank National Association $5,199,999.99 26 2/3%
National City Bank $5,200,000.00 26 2/3%
Associated Bank, N.A. $3,250,000.00 16 2/3%
U.S. Bank $3,250,000.00 16 2/3%
Comerica Bank $2,600,000.00 13 1/3%
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TOTAL $19,500,000.00
