EXHIBIT 4.1. (ii)
AMENDMENT NO. 1 TO
REVOLVING CREDIT AGREEMENT
This AMENDMENT NO. 1 (this "Amendment"), made as of February 5, 2003
among ▇▇▇▇▇▇ GROUP INC., a Delaware corporation with a principal place of
business at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the
"Borrower"), and FLEET NATIONAL BANK, a national banking association with an
office at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, as agent for the lenders which
are or may become party to the Credit Agreement referred to below (collectively,
the "Lenders") (Fleet National Bank, in its capacity as agent for the Lenders,
being hereinafter referred to as the "Administrative Agent"), amends that
certain Revolving Credit Agreement dated the 14th day of June, 2002 (as amended
and in effect from time to time, the "Credit Agreement"), executed by the
Borrower, the Lenders, the Administrative Agent, and HSBC Bank USA, KeyBank
National Association, Mellon Bank, N.A., and ▇▇▇▇▇▇▇ Bank as Co-Documentation
Agents (the "Documentation Agents"). Terms not otherwise defined herein which
are defined in the Credit Agreement referred to below shall have the respective
meanings herein assigned to such terms in the Credit Agreement referred to
below.
WHEREAS, the parties hereto wish to amend certain of the provisions of
the Credit Agreement as hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. Amendments to Credit Agreement.
(a) Definitions. Section 1.1 of the Credit Agreement is hereby
amended by (i) the deletion of the definition of "Applicable Margin" set forth
therein and substituting in lieu thereof the following new definition and (ii)
the addition of the following new definition of "Industrial Distribution
Business Acquisition":
"Applicable Margin. For each period commencing on an Adjustment
Date through the date immediately preceding the next Adjustment Date (each a
"Rate Adjustment Period"), the Applicable Margin shall be the applicable margin
set forth below with respect to the Leverage Ratio, as determined for the four
(4) consecutive fiscal quarters then ending of the Borrower and its Subsidiaries
ending on the last day of the fiscal quarter ended immediately prior to the
applicable Rate Adjustment Period.
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BASE LIBOR
LEVERAGE RATE RATE LETTER OF
LEVEL RATIO LOANS LOANS CREDIT COMMITMENT FEE
---------------------------------------------------------------------------------------------------------
I Less than to 2.25:1 0.125% 1.250% 1.250% 0.250%
---------------------------------------------------------------------------------------------------------
II Less than 2.50:1 but
greater than or equal
to 2.25:1 0.250% 1.375% 1.375% 0.300%
---------------------------------------------------------------------------------------------------------
III Less than 2.75:1 but
greater than or equal
to 2.50:1 0.375% 1.500% 1.500% 0.350%
---------------------------------------------------------------------------------------------------------
IV Less than 3.00:1 but
greater than or equal 0.500% 1.750% 1.750% 0.375%
to 2.75:1
---------------------------------------------------------------------------------------------------------
V Greater than or equal 0.625% 2.00% 2.00% 0.450%
to 3.00:1
---------------------------------------------------------------------------------------------------------
Notwithstanding the foregoing, the Applicable Margin for the period from the
date of Closing until the date of receipt of the Compliance Certificate for the
period ending June 30, 2002 shall be Level IV above. If the Borrower fails to
maintain a Leverage Ratio of 3.00 or less as evidenced by the Compliance
Certificate delivered for the period ending September 30, 2003, the Applicable
Margin for Level V above for the period commencing on the next Adjustment Date
and thereafter will be increased to 2.25%. If the Borrower fails to deliver any
Compliance Certificate pursuant to Section 8.4(c) hereof, then for the period
commencing on the next Adjustment Date to occur subsequent to such failure
through the date immediately following the date on which such Compliance
Certificate is delivered, the Applicable Margin shall be the highest Applicable
Margin set forth above."
"Industrial Distribution Business Acquisition. The acquisition
by the Borrower of Kar Products, LLC ("Kar") pursuant to the Membership Interest
and Asset Purchase Agreement dated as of January 15, 2003, by and among the
Borrower, ▇▇▇▇▇▇ Group Canada Corp., Kar, A. & H. Bolt & Nut Company Ltd.,
Sunsource Canada Investment Company, GC-Sun Holdings II, L.P., A & H Bolt
Holdings, Inc., GC-Sun, Inc., GC-Sun ▇.▇. ▇▇, Inc., GC-Sun G.P., Inc. and GC-Sun
Holdings, L.P., in which the Borrower purchased (i) certain A. & H. Bolt & Nut
Company Ltd. assets for $4.0 million in cash and (ii) the membership interests
in Kar Products, LLC, a limited liability company which will guaranty the
Obligations and become a directly owned subsidiary of the Borrower, for $74.5
million."
(b) Section 5.2. Section 5.2 of the Credit Agreement is hereby
amended by the addition of the following new subsection:
"5.2.1. Leverage Ratio Fee. In the event that the Leverage Ratio
is not less than 3.10:1 for the four consecutive fiscal quarters ending
September 30, 2003, the Borrower shall pay to the Administrative Agent, for the
pro rata benefit of the
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Lenders, a Leverage Ratio fee (the "Leverage Ratio Fee") on November 29, 2003 in
an amount equal to 10 basis points multiplied by each Lender's Commitment."
(c) Section 8.14. Section 8 of the Credit Agreement is hereby
amended by the addition of the following new section:
"8.14. Amendment of Kar Products, LLC Limited Liability Company
Agreement. Within thirty (30) days of the effective date of Amendment No. 1 to
the Credit Agreement, the Borrower will amend Section 6.1 of the Second Amended
and Restated Limited Liability Company Agreement of Kar Products, LLC in form
and substance satisfactory to the Administrative Agent."
(d) Section 9.3. Section 9.3 of the Credit Agreement is hereby
amended by deleting the last paragraph set forth therein and substituting in
lieu thereof the following new paragraph:
"The Investments permitted under clauses (g), (h) and (i)(A) of
this Section 9.3 shall be limited as follows: the aggregate dollar amount of
such Investments in the form of acquisitions (excluding consideration paid (i)
by the issuance of equity of the Borrower, and (ii) in connection with the
Industrial Distribution Business Acquisition, so long as the target of the
contemplated transaction shall deliver a guaranty of the Obligations in the form
of Exhibit E hereof), capital contributions, loans or advances, or their
equivalent, net of stock redemptions, capital distributions, proceeds from the
sale of new equity of the Borrower (which shall be limited to up to 50% of the
net proceeds of any such issuance), loan repayments or advances by such
Subsidiaries to the Borrower, shall not at any time exceed 10% of Consolidated
Total Assets."
(e) Section 10.2. Section 10.2 of the Credit Agreement is hereby
restated in its entirety as follows:
"10.2. Leverage Ratio. As of the end of any fiscal quarter, the
Borrower will not permit the ratio of Consolidated Total Debt
(excluding, for purposes of calculation of the Leverage Ratio, reverse
interest rate swap contracts) as at such date to Consolidated EBITDA for
the four (4) consecutive fiscal quarters then ending (the "Leverage
Ratio") to be more than the applicable ratio set forth in the table
below:
For the Four Quarters Ending Ratio
---------------------------- -----
6/30/2002 and 9/30/2002 3.50:1
12/31/2002 3.00:1
3/31/2003 - 9/30/2003 3.25:1
12/31/2003 - 3/31/04 3.00:1
6/30/04 - Thereafter 2.75:1"
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2. Ratification. Except as expressly provided for herein, the
Credit Agreement and all documents, instruments and agreements related thereto
are hereby ratified and confirmed in all respects and shall continue in full
force and effect. The Credit Agreement and this Amendment shall be read and
construed as one instrument.
3. Representations and Warranties. The Borrower hereby represents
and warrants that all representations and warranties as set forth in the Credit
Agreement are true and correct in all material respects on and as of the date
hereof, except for Section 7.4.2 which continues to be true as of the Balance
Sheet Date. All such representations and warranties are hereby ratified,
affirmed and incorporated herein by reference with the same force and effect as
though set forth herein in their entirety.
4. Effectiveness. This Amendment shall become effective as of the
date hereof upon the satisfaction of the following conditions precedent:
(a) The Borrower and the Lenders shall have executed and delivered
this Amendment.
(b) All proceedings in connection with the Industrial Distribution
Business Acquisition and all documents incident thereto, including without
limitation the guaranties of the Obligations by Kar, shall be reasonably
satisfactory in substance and form to the Administrative Agent and its counsel,
and the Administrative Agent shall have received all information and such
counterpart originals or certified or other copies of such documents as the
Administrative Agent may reasonably request.
(c) The Administrative Agent shall have received from the Borrower
an amendment fee in an amount equal to 50 basis points multiplied by the
individual Commitment of each Lender who has approved this Amendment as of
February 5, 2003, for the benefit of such approving Lenders.
(d) Kar shall have executed and delivered to the Administrative
Agent a Guaranty of the Obligations in the form of Exhibit E to the Credit
Agreement.
5. No Waiver. Nothing contained herein shall constitute a waiver
of, impair or otherwise adversely affect any Obligations, any other obligation
of the Borrower or any rights of the Lenders consequent thereon.
6. Counterparts. This Amendment may be executed in any number of
counterparts, but all such counterparts shall together constitute but one
instrument. In making proof of this Amendment it shall not be necessary to
produce or account for more than one counterpart signed by each party hereto by
and against which enforcement hereof is sought.
IN WITNESS WHEREOF, the undersigned have executed this agreement as of
the day and year first above written.
▇▇▇▇▇▇ GROUP INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President, Finance
and Chief Financial Officer
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
Title: Vice President, Treasurer
FLEET NATIONAL BANK, individually and
as Administrative Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Director
HSBC BANK USA, individually and as
Co-Documentation Agent
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
KEYBANK NATIONAL ASSOCIATION,
individually and as Co-Documentation
Agent
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Vice President
MELLON BANK, N.A., individually and
as Co-Documentation Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
▇▇▇▇▇▇▇ BANK, individually and as
Co-Documentation Agent
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
Title: Senior Vice President
SUNTRUST BANK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
THE BANK OF NEW YORK
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
BANK OF AMERICA, N.A.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
COMERICA BANK
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title: Account Officer
BANK ONE, NA (Main Office Chicago)
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Director
THE GOVERNOR & COMPANY OF
THE BANK OF IRELAND
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Associate Director
By: /s/ ▇▇▇ ▇▇▇▇▇
Name: ▇▇▇ ▇▇▇▇▇
Title: Head of Acquisition Finance
