FIFTH AMENDMENT TO CREDIT AGREEMENT
THIS FIFTH AMENDMENT TO CREDIT AGREEMENT dated as of September 28,
1998 ("this Amendment") is by and between NORSTAN, INC., a Minnesota corporation
(the "Borrower"), the banks which are signatories hereto (individually, a "Bank"
and, collectively, the "Banks") and U.S. BANK NATIONAL ASSOCIATION, a national
banking association, one of the Banks, as agent for the Banks (in such capacity,
the "Agent").
RECITALS
A. The Borrower, U.S. Bank National Association (in its individual
corporate capacity, "U.S. Bank"), M&I Xxxxxxxx & Xxxxxx Bank ("M&I Bank), Xxxxxx
Trust and Savings Bank ("Xxxxxx," and, together with U.S. Bank and M&I Bank
collectively, the "Existing Banks") and the Agent are parties to a Credit
Agreement dated as of July 23, 1996, as amended by a First Amendment dated as of
October 11, 1996, a Second Amendment dated as of September 26, 1997, a Third
Amendment dated as of March 20, 1998 and a Fourth Amendment dated as of July 23,
1998 (as so amended, the "Credit Agreement").
B. The Borrower desires to add Norwest Bank Minnesota, National
Association ("Norwest") as a Bank under the Credit Agreement and the Agent and
the Existing Banks are willing to permit Norwest to become a Bank under the
Credit Agreement upon the terms and conditions set forth therein and in this
Amendment.
C. The parties hereto desire to amend the Credit Agreement in the
respects hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:
Section 1. DEFINITIONS. Capitalized terms used herein and not
otherwise defined herein, but which are defined in the Credit Agreement, shall
have the meanings ascribed to such terms in the Credit Agreement unless the
context otherwise requires.
Section 2. ADDITION OF NORWEST AS A BANK. Subject to Section 5
hereof, Norwest hereby assumes, adopts and, agrees to become a party, as a Bank,
to the Credit Agreement and to each other Loan Document to which the Banks are
parties, with a Revolving Commitment Amount stated in the amended Exhibit 1.1A
to the Credit Agreement adopted by Section 3 of this Amendment, and the parties
hereto, other than Norwest, acknowledge and consent to such actions by Norwest.
Upon the effectiveness of this Amendment, as provided in Section 5 hereof,
Norwest shall be a Bank under the Credit Agreement and the other Loan Documents
and shall have all of the rights, privileges and benefits of a Bank under the
Credit Agreement and the other Loan Documents, and all of the duties of a Bank
thereunder, in each case as if Norwest had been initially a party to the Credit
Agreement. Upon the effectiveness of
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this Amendment, U.S. Bank shall sell and assign to Norwest, and Norwest shall
purchase and accept from U.S. Bank, at par, and without recourse to or
warranties of any kind by U.S. Bank, a portion of U.S. Bank's Revolving
Commitment Amount equal to $10,000,000, and corresponding portions of (i)
U.S. Bank's Commercial Paper Sublimit, (ii) U.S. Bank's Letter of Credit
Sublimit and (iii) the principal and interest accrued on U.S. Bank's
Revolving Note (such amounts shall be collectively referred to as the
"Transferred Interest").
Section 3. AMENDMENTS TO CREDIT AGREEMENT. Subject to Section 5
hereof, the Credit Agreement is hereby amended as follows:
(a) All references to the "Banks" contained in the Credit Agreement
shall be deemed to include, collectively, Norwest and each of the Existing
Banks.
(b) Exhibit 1.1A to the Credit Agreement is deleted and Exhibit 1.1A
of this Amendment is inserted in its place.
(c) The addresses for notices to Norwest shall be as set forth below
their respective signature blocks on the signature pages to this Amendment
unless and until such addresses are changed in accordance with Section 9.4 of
the Credit Agreement.
Section 4. REPRESENTATIONS AND WARRANTIES OF THE BORROWER. To induce
the Banks and the Agent to execute and deliver this Amendment (which
representations and warranties shall survive the execution and delivery of this
Amendment), the Borrower represents and warrants to the Agent and the Banks
that:
(a) this Amendment, the Amended U.S. Bank Note (as hereinafter
defined) and the Norwest Note (as hereinafter defined) have been duly
authorized, executed and delivered by it and this Amendment, the Amended
U.S. Bank Note and the Norwest Note constitute the legal, valid and binding
obligations of the Borrower enforceable against the Borrower in accordance
with their respective terms, subject to limitations as to enforceability
which might result from bankruptcy, insolvency, reorganization, moratorium
or similar laws or equitable principles relating to or limiting creditors'
rights generally;
(b) the Credit Agreement, as amended by this Amendment, constitutes
the legal, valid and binding obligation of the Borrower enforceable against
the Borrower in accordance with its terms, subject to limitations as to
enforceability which might result from bankruptcy, insolvency,
reorganization, moratorium or similar laws or equitable principles relating
to or limiting creditors' rights generally;
(c) the execution, delivery and performance by the Borrower of this
Amendment, the Amended U.S. Bank Note and the Norwest Note (i) have been
duly authorized by all requisite corporate action and, if required,
shareholder action, (ii) do not require the consent or approval of any
governmental or regulatory body or agency, and (iii) will not (A) violate
(1) any provision of law, statute, rule or regulation or its certificate of
incorporation or bylaws, (2) any order of any court or any rule, regulation
or order of any other agency or government binding upon it, or (3) any
provision of any material
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indenture, agreement or other instrument to which it is a party or by which
any of its properties or assets are or may be bound, or (B) result in a
breach of or constitute (alone or with due notice or lapse of time or both)
a default under any indenture, agreement or other instrument referred to in
clause (iii)(A)(3) of this Section 4(c);
(d) as of the date hereof, no Default or Event of Default has
occurred which is continuing; and
(e) all the representations and warranties contained in Article IV of
the Credit Agreement are true and correct in all material respects with the
same force and effect as if made by the Borrower on and as of the date
hereof.
Section 5. CONDITIONS TO EFFECTIVENESS OF THIS AMENDMENT. This
Amendment shall not become effective until, and shall become effective on the
date (the "Fifth Amendment Effective Date") when, each and every one of the
following conditions shall have been satisfied:
(a) executed counterparts of this Amendment, duly executed by the
Borrower and each of the Banks, shall have been delivered to the Agent;
(b) U.S. Bank shall have received a new promissory note substantially
in the form attached hereto as Exhibit A (the "Amended U.S. Bank Note"),
which Amended U.S. Bank Note shall constitute an amendment and restatement
of the Revolving Note payable to U.S. Bank;
(c) Norwest shall have received a promissory note substantially in
the form attached hereto as Exhibit B duly executed by the Borrower (the
"Norwest Note"), which Norwest Note shall constitute Norwest's Revolving
Note under the Credit Agreement;
(d) the Agent shall have received from each Guarantor a Consent and
Agreement of Guarantor in the form of Exhibits C-1 through C-8 hereto (the
"Guarantor Agreements") duly completed and executed by such Guarantor;
(e) the Agent shall have received a copy of the resolutions of the
Board of Directors of the Borrower authorizing the execution, delivery and
performance by the Borrower of this Amendment, the Amended U.S. Bank Note
and the Norwest Note certified by an officer thereof, together with a
certificate of an officer of the Borrower certifying as to the incumbency
and the true signatures of the officers authorized to execute this
Amendment, the Amended U.S. Bank Note and the Norwest Note on behalf of the
Borrower;
(f) the Agent shall have received the favorable opinion of counsel to
Borrower, covering the matters set forth in Exhibit D hereto; and
Upon the Fifth Amendment Effective Date, (i) the Agent shall notify the Borrower
and the Banks that this Amendment has become effective, but the failure of the
Agent to give such notice shall not affect the validity of this Amendment or
prevent it from becoming effective, (ii) Norwest shall pay to U.S. Bank in cash
or cash equivalents the purchase price for the Transferred Interest,
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in the amount or the sum of $10,000,000. From and after the Fifth Amendment
Effective Date, all interest, Revolving Commitment Fees and Letter of Credit
Fees accrued on the Transferred Interest for the billing period in which the
Fifth Amendment Effective Date falls shall be paid to the Agent as provided
in the Credit Agreement, and distributed by the Agent (A) with respect to
amounts accrued before the Fifth Amendment Effective Date, to U.S. Bank and
(B) with respect to amounts accrued on or after the Fifth Amendment Effective
Date, to Norwest.
Section 7. COUNTERPARTS AND EFFECTIVENESS. This Amendment may be
executed in any number of counterparts, and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed an original, but all such counterparts together shall constitute but one
of the same instrument.
Section 8. LEGAL EXPENSES. The Borrower agrees to reimburse the
Agent for all reasonable out-of-pocket expenses (including attorneys' fees and
legal expenses of Xxxxxx & Whitney LLP, counsel for the Agent) incurred in
connection with the negotiation, preparation, execution and delivery of this
Amendment.
Section 9. AFFIRMATION. Each party hereto affirms and acknowledges
that (a) the Credit Agreement as amended by this Amendment remains in full force
and effect in accordance with its terms, (b) all references to the "Credit
Agreement" or any similar term contained in any other Loan Document shall be
deemed to be references to the Credit Agreement as amended hereby and (c) all
references to the "Revolving Notes" or any similar term contained in the Credit
Agreement or any other Loan Document shall be deemed to be references to the
Amended U.S. Bank Note, the Norwest Note and the Revolving Notes previously
issued by the Borrower to each of Xxxxxx and M&I.
Section 10. CHOICE OF LAW. This Amendment shall be governed by, and
construed in accordance with, the internal law, and not the law of conflicts, of
the State of Minnesota, but giving effect to federal laws applicable to national
banks.
Section 11. SUCCESSORS AND ASSIGNS. This Amendment shall be binding
upon the Borrower, the Banks, the Agent and their respective successors and
assigns, and shall inure to the benefit of the Borrower, the Banks and the
successors and assigns of the Banks and the Agent.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed as of the day and year first above written.
NORSTAN, INC.
By /s/ Xxxxxx X. Xxxx
------------------------------------
Its Treasurer
---------------------------
U.S. BANK NATIONAL ASSOCIATION,
as a Bank and as Agent
By /s/ Xxxxx Xxxxxxx
------------------------------------
Title Assistant Vice President
---------------------------------
M & I XXXXXXXX & ILSLEY BANK
By /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Title Vice President
---------------------------------
By /s/ Xxxx X. Xxxxxx
------------------------------------
Title Vice President
---------------------------------
XXXXXX TRUST & SAVINGS BANK
By /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Title Vice President
---------------------------------
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NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By /s/ Xxxx Xxxxxxxx
-----------------------------------
Title Portfolio Manager
--------------------------------
Address for Notices:
--------------------
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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EXHIBIT 1.1A TO FIFTH
AMENDMENT TO CREDIT AGREEMENT
EXHIBIT 1.1A TO
CREDIT AGREEMENT
REVOLVING COMMITMENT AMOUNTS AND SUBLIMITS
Revolving Commercial Standby
Commitment Revolving Paper Letter of Credit
Bank Amount Percentage Sublimit Sublimit
------ ----------- ---------- ----------- ----------------
U.S. Bank $40,000,000 50% $15,000,000 $2,500,000
National
Association
Xxxxxx Trust $20,000,000 25% $ 7,500,000 $1,250,000
And Savings
Bank
Xxxxxxxx & $10,000,000 12.5% $ 3,750,000 $ 625,000
Ilsley Bank
Norwest Bank $10,000,000 12.5% $ 3,750,000 $ 625,000
Minnesota,
National
Association
----------- ----- ----------- ----------
Total $80,000,000 100% $30,000,000 $5,000,000
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