CONFORMED COPY
EIGHTH AMENDMENT AND WAIVER, dated as of June 10, 2003 (this "Amendment and
Waiver"), to the Fourth Amended and Restated Credit Agreement, dated as of July
28, 1999 (as amended pursuant to the First Amendment and Consent thereto, dated
as of October 12, 1999, the Second Amendment thereto, dated as of December 20,
1999, the Third Amendment thereto, dated as of April 14, 2000, the Fourth
Amendment and Waiver thereto, dated as of June 5, 2001, the Fifth Amendment and
Waiver thereto, dated as of March 14, 2002, the Sixth Amendment and Consent
thereto, dated as of May 28, 2002, and the Seventh Amendment and Waiver thereto,
dated as of March 13, 2003, and as the same may further be amended, supplemented
or otherwise modified from time to time, the "Credit Agreement"), among Audiovox
Corporation, a Delaware corporation (the "Borrower"), the several banks and
other financial institutions from time to time parties thereto (collectively,
the "Lenders"; individually, a "Lender"), and JPMorgan Chase Bank (formerly
known as The Chase Manhattan Bank), a New York banking corporation, as
administrative and collateral agent for the Lenders (in such capacity, the
"Agent").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Borrower, the Lenders and the Agent are parties to the Credit
Agreement;
WHEREAS, the Borrower has requested that the Lenders waive and amend
certain terms in the Credit Agreement in the manner provided for herein; and
WHEREAS, the Agent and the Lenders are willing to agree to the requested
waiver and amendment, on the terms and conditions provided for herein;
NOW, THEREFORE, in consideration of the premises contained herein, the
parties hereto agree as follows:
1. Defined Terms. Unless otherwise defined herein, terms which are defined
in the Credit Agreement and used herein (and in the recitals hereto) as defined
terms are so used as so defined.
2. Decrease in Commitments. The Borrower, the Lenders and the Agent hereby
agree that, on the Eighth Amendment Effective Date, the aggregate Commitments of
the Lenders will be reduced to $175,000,000.
3. Amendments of Subsection 1.1 (Definitions). Subsection 1.1 of the Credit
Agreement is hereby amended as follows:
"Consolidated Pre-Tax Income": for any period, the amount which would
appear opposite the caption "Income (loss) before provision for (recovery
of) income taxes, minority interest, extraordinary item and cumulative
effect of a change in accounting for negative goodwill", on a consolidated
statements of operations of the Borrower and its subsidiaries in accordance
with GAAP, adjusted to reflect (either by adding or subtracting) "minority
interest" as determined in accordance with GAAP and set forth on such
consolidated statements of operations. If Consolidated Pre-Tax Income is
less than zero for any period, it is referred to herein as a "Consolidated
Pre-Tax
Exhibit 99.1
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Loss". For purposes of this Agreement, Consolidated Pre-Tax Income shall
not (other than for purposes of determining the Applicable Margin) include
the effects of any conversion of any Subordinated Debentures into common
stock of the Borrower or any gains or losses from the sale of Capital Stock
of CellStar or any other extraordinary gains.
"Eighth Amendment and Waiver": the Eighth Amendment and Waiver, dated as of
June 10, 2003, to this Agreement.
"Eighth Amendment Effective Date": June 10, 2003.
4. Waiver of Subsection 9.1 (Financial Statements). The Lenders hereby
waive compliance, until June 10, 2003, by the Borrower with the requirements of
subsection 9.1(a) of the Credit Agreement with respect to the fiscal year of the
Borrower ended November 30, 2002 and subsection 9.1(b) with respect to the
fiscal quarter ended February 28, 2003.
5. Waivers of Subsection 10.1. The Lenders hereby waive compliance by the
Borrower with the provisions of subsection 10.1(a)(i)(C) of the Credit Agreement
with respect to the fiscal year ending November 30, 2002, so long as
Consolidated Pre-Tax Loss (as determined prior to giving effect to this
Amendment and Waiver) with respect to such fiscal year does not exceed
$1,110,000.
6. Representations and Warranties. On and as of the date hereof, the
Borrower hereby confirms, reaffirms and restates the representations and
warranties set forth in Section 7 of the Credit Agreement mutatis mutandis,
except to the extent that such representations and warranties expressly relate
to a specific earlier date in which case the Borrower hereby confirms, reaffirms
and restates such representations and warranties as of such earlier date.
7. Conditions to Effectiveness. This Amendment and Waiver shall become
effective as of the date first written above (x) upon receipt by the Agent of
(i) counterparts to this Amendment and Waiver duly executed by the Borrower and
the Required Lenders, (ii) an amendment fee in the amount of $50,000, for the
account of Lenders which have executed and delivered to the Agent this Amendment
and Waiver prior to 12:00 p.m. on June 10, 2003 (and will be paid to such
Lenders pro rata according to their respective Commitments) and (iii) an
Acknowledgement and Consent in the form of Exhibit A hereto duly executed by
each of the Guarantors and (y) so long as on the date the conditions in clause
(x) above have been satisfied, no Default or Event of Default shall have
occurred and be continuing (after giving effect to this Amendment and Waiver).
8. Continuing Effect; No Other Waivers. Except as expressly provided
herein, all of the terms and provisions of the Credit Agreement are and shall
remain in full force and effect. The waiver provided for herein is limited to
the specific subsections of the Credit Agreement specified herein and shall not
constitute a consent, waiver or amendment of, or an indication of the Agent's or
the Lenders' willingness to consent to any action requiring consent under or to
waive or amend, any other provisions of the Credit Agreement or the same
subsections for any other date or time period (whether or not such other
provisions or compliance with such subsections for another date or time period
are affected by the circumstances addressed in this Amendment and Waiver).
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9. Expenses. The Borrower agrees to pay and reimburse the Agent for all its
reasonable costs and out-of-pocket expenses incurred in connection with the
preparation and delivery of this Amendment and Waiver, including, without
limitation, the reasonable fees and disbursements of counsel to the Agent.
10. Counterparts. This Amendment and Waiver may be executed in any number
of counterparts by the parties hereto (including by facsimile transmission),
each of which counterparts when so executed shall be an original, but all the
counterparts shall together constitute one and the same instrument.
11. GOVERNING LAW. THIS AMENDMENT AND WAIVER SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment and Waiver to
be executed and delivered by their respective duly authorized officers as of the
date first above written.
AUDIOVOX CORPORATION
By: s/Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
JPMORGAN CHASE BANK,
as Agent and as a Lender
By: s/Xxxx Xxxxxxxxx
Name: Xxxx Xxxxxxxxx
Title: Vice President
FLEET NATIONAL BANK, as a Lender
By: s/Xxxxxx X. Xxxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxxx
Title: Senior Vice President
THE CIT GROUP/BUSINESS CREDIT, INC.,
as a Lender
By: s/Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President
CITIBANK, N.A., as a Lender
By: s/Xxxxxxx Xxxxx
Name: Xxxxxxx Xxxxx
Title: Vice President
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MELLON BANK, N.A., as a Lender
By: ______________________________
Name:
Title:
GE COMMERCIAL DISTRIBUTION FINANCE
CORPORATION,
as a Lender
By: s/Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: VP Operations
ISRAEL DISCOUNT BANK OF NEW YORK,
as a Lender
By: s/ Xxxxxx Xxxxxxxx
Name: Xxxxxx Xxxxxxxx
Title: First Vice President
By:s/ Xxxxx Xxxxxxxx
Name: Xxxxx Xxxxxxxx
Title: First Vice President
PNC BUSINESS CREDIT INC., as a Lender
By: ___________________________
Name:
Title:
WASHINGTON MUTUAL BANK, FA, as a Lender
By: Xxxx Umhaver
Name: Xxxx Umhaver
Title: Vice President
Signature page to Eighth Amendment and Waiver
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BANK LEUMI USA, as a Lender
By: ____________________________
Name:
Title:
U.S. BANK, N.A., as a
By: ____________________________
Name:
Title:
Signature page to Eighth Amendment and Waiver
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ACKNOWLEDGMENT AND CONSENT
Each of the undersigned corporations (i) as a guarantor under that certain
Amended and Restated Subsidiaries Guarantee, dated as of March 15, 1994 (as
amended, supplemented or otherwise modified from time to time, the "Guarantee"),
made by each of such corporations in favor of the Collateral Agent, (ii) as a
grantor under that certain Amended and Restated Security Agreement, dated as of
March 15, 1994 (as amended, supplemented or otherwise modified from time to
time, the "Security Agreement"), made by each of such corporations in favor of
the Collateral Agent, and (iii) in the case of Audiovox Holding Corp., as the
pledgor under that certain Pledge Agreement, dated as of February 9, 1996 (as
amended, supplemented or otherwise modified from time to time, the "Pledge
Agreement"), made by Audiovox Holding Corp. in favor of JPMorgan Chase Bank
(formerly known as The Chase Manhattan Bank), as pledge agent for the secured
parties thereunder, hereby consents to the execution and delivery of the Fifth
Amendment and Waiver to which this Acknowledgment and Consent is attached and
hereby confirms and agrees that the Guarantee, the Security Agreement and the
Pledge Agreement are, and shall continue to be, in full force and effect and are
hereby ratified and confirmed in all respects and the Guarantee, the Security
Agreement, the Pledge Agreement and all of the Subsidiaries Collateral (as
defined in the Security Agreement) and Collateral (as defined in the Pledge
Agreement) do, and shall continue to, secure the payment of all of the
Obligations (as defined in the Guarantee and the Security Agreement, as the case
may be) pursuant to the terms of the Guarantee or the Security Agreement, as the
case may be, or, in the case of the Pledge Agreement, secure the payment of the
Secured Obligations (as defined in the Pledge Agreement) pursuant to the terms
of the Pledge Agreement. Capitalized terms not otherwise defined herein shall
have the meanings assigned to them in the Credit Agreement referred to in the
Seventh Amendment and Waiver to which this Acknowledgment and Consent is
attached.
QUINTEX MOBILE COMMUNICATIONS
CORP.
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AMERICAN RADIO CORP.
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
Signature page to Eighth Amendment and Waiver
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AUDIOVOX INTERNATIONAL CORP.
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AUDIOVOX CANADA LIMITED
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AUDIOVOX HOLDING CORP.
By: s/ Xxxxx Xxxxxx
Name: Xxxxx Xxxxxx
Title: Vice President
AUDIOVOX ASIA INC.
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: President
AUDIOVOX LATIN AMERICA LTD.
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: President
AUDIOVOX COMMUNICATIONS CORP.
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
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AUDIOVOX ELECTRONICS CORP.
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
CODE SYSTEMS, INC.
By: s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title:Chief Financial Officer
Dated as of June 10, 2003
