FIRST AMENDMENT TO CREDIT AGREEMENT
This first amendment to credit agreement (this "Amendment") is made and
entered into as of June 29, 1998, by and among U. S. BANK NATIONAL
ASSOCIATION, a national banking association ("U. S. Bank"), and MACKIE
DESIGNS INC., a Washington corporation ("Borrower").
R E C I T A L S:
A. On or about June 18, 1998, U. S. Bank and Borrower entered into
that certain credit agreement (together with all amendments, supplements,
exhibits, and modifications thereto, the "Credit Agreement") whereby U. S.
Bank agreed to extend certain credit facilities to Borrower.
B. Borrower have requested U. S. Bank to increase the amount of the
Acquisition Loan to $14,000,000. The purpose of this Amendment is to set
forth the terms and conditions upon which U. S. Bank will grant Borrower's
requests.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
set forth herein, the parties agree as follows:
ARTICLE I. AMENDMENT
The Credit Agreement, as well as all of the other Loan Documents, are
hereby amended as set forth herein. Except as specifically provided for
herein, all of the terms and conditions of the Credit Agreement and each of
the other Loan Documents shall remain in full force and effect throughout the
terms of the Loans, as well as any extensions or renewals thereof.
ARTICLE II. DEFINITIONS
As used herein, capitalized terms shall have the meanings given to them
in the Credit Agreement, except as otherwise defined herein, or as the
context otherwise requires.
ARTICLE III. INCREASE IN ACQUISITION LOAN
3.1 INCREASE
Section 3.1(b) of the Credit Agreement is hereby deleted in its entirety
and replaced with the following:
FIRST AMENDMENT TO CREDIT AGREEMENT
(b) "Acquisition Loan Commitment" means the sum of (i) $14,000,000,
less (ii) on an aggregate basis, on September 30 of each year (commencing
September 30, 1999), an amount equal to the amount of the initial Funding
under clause (i) divided by seven, and less (iii) the aggregate amount of
all Disposition Payments.
3.2 RENEWAL REVOLVING NOTE
Concurrently with the execution of this Amendment, Borrower shall
execute and deliver to U. S. Bank a renewal promissory note in the form
attached hereto as Exhibit A ("Renewal Acquisition Note") which shall
continue to evidence the Acquisition Loan. The Acquisition Note and all
previous renewals thereof shall be marked "Renewed" and retained by U. S.
Bank until the Acquisition Loan is paid in full and U. S. Bank's commitment
to advance Fundings thereunder is terminated.
ARTICLE IV. CONDITIONS PRECEDENT
The modifications set forth in this Amendment shall not be effective
unless and until the following conditions have been fulfilled to U. S. Bank's
satisfaction:
(a) U. S. Bank shall have received this Amendment and the Renewal
Acquisition Note, duly executed and delivered by the parties hereto.
(b) There shall not exist any Default or Event of Default under the
Credit Agreement or any other Loan Document.
(c) All representations and warranties of Borrower contained in the
Credit Agreement or otherwise made in writing in connection therewith or
herewith shall be true and correct and in all material respects have the same
effect as though such representations and warranties had been made on and as
of the date of this Amendment.
ARTICLE V. GENERAL PROVISIONS
5.1 REPRESENTATIONS AND WARRANTIES
Borrower hereby represent and warrant to U. S. Bank that as of the date
of this Amendment, there exists no Default or Event of Default. All
representations and warranties of Borrower contained in the Credit Agreement
and the Loan Documents, or otherwise made in writing in connection therewith,
are true and correct as of the date of this Amendment. Borrower acknowledge
and agree that all of Borrower's Indebtedness to U. S. Bank is payable
without offset, defense, or counterclaim.
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5.2 SECURITY
All Loan Documents evidencing U. S. Bank's security interest in the
Collateral shall remain in full force and effect, and shall continue to
secure, without change in priority, the payment and performance of the Loans,
as amended herein, and any other Indebtedness owing from Borrower to U. S.
Bank.
5.3 GUARANTY
The parties hereto agree that the Guaranty shall remain in full force
and effect and continue to guarantee the repayment of the Loans to U. S. Bank
as set forth in such Guaranty.
5.4 PAYMENT OF EXPENSES
Borrower shall pay on demand all costs and expenses of U. S. Bank
incurred in connection with the preparation, negotiation, execution, and
delivery of this Amendment, including, without limitation, reasonable
attorneys' fees incurred by U. S. Bank.
5.5 SURVIVAL OF CREDIT AGREEMENT
The terms and conditions of the Credit Agreement and each of the other
Loan Documents shall survive until all of Borrower's obligations under the
Credit Agreement are satisfied in full.
5.6 COUNTERPARTS
This Amendment may be executed in one or more counterparts, each of
which shall constitute an original agreement, but all of which together shall
constitute one and the same agreement.
5.7 STATUTORY NOTICE
ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER
WASHINGTON LAW.
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IN WITNESS WHEREOF, U. S. Bank and Borrower have caused this Amendment
to be duly executed by their respective duly authorized signatories as of the
date first above written.
MACKIE DESIGNS INC.
By
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Title
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U. S. BANK NATIONAL ASSOCIATION
By
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Xxx X. Xxxxxxxx
Vice President
REAFFIRMATION OF GUARANTY AND COLLATERAL DOCUMENTS
The undersigned hereby: (a) acknowledges that it has read the foregoing
First Amendment to Credit Agreement, (b) reaffirms its obligations under the
Guaranty and the Security Agreement and other collateral documents evidencing
security interests granted by the undersigned to U. S. Bank to secure the
obligations of Borrower to U. S. Bank, (c) agrees that its Guaranty
guarantees and its Security Agreement secures the repayment of the Loans, as
amended by the foregoing First Amendment to Credit Agreement, and (d)
acknowledges that its obligations pursuant to its Guaranty and the Security
Agreement are enforceable without defense, offset, or counterclaim.
MACKIE DESIGNS MANUFACTURING INC.
By
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Title
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