EXHIBIT 10.16
SECOND AMENDMENT TO CREDIT AGREEMENT
This SECOND AMENDMENT TO CREDIT AGREEMENT (this "AMENDMENT") is dated as
of May 22, 1998 and entered into by and among UNIONTOOLS, INC., a Delaware
corporation ("BORROWER") and XXXXXX FINANCIAL, INC., in its individual capacity
as a Lender and as Agent for all Lenders ("AGENT"), and such other Persons
executing this Agreement as Lenders.
R E C I T A L S
WHEREAS, Borrower and Agent have entered into an Amended and Restated
Credit Agreement dated as of May 20, 1997, as amended by that certain Amendment
No. 1 to Credit Agreement dated November 24, 1997 (as the same may be further
amended, restated, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT"), pursuant to which, among other things, Lenders have agreed,
subject to the terms and conditions set forth in the Credit Agreement, to make
loans and financial accommodations to Borrower; and
WHEREAS, Borrower has requested that the Agent and Lenders agree to
modify the Credit Agreement pursuant to the terms and conditions of this
Amendment; and
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Borrower, Lenders and Agent agree as
follows:
1. DEFINED TERMS. All capitalized terms used herein but not
elsewhere defined shall have the respective meanings ascribed to
such terms in the Credit Agreement, as amended by this Amendment.
2. AMENDMENTS TO LOAN DOCUMENTS AND LIMITED WAIVER OF CONDITION
2.1 A. AMENDMENTS. The Credit Agreement is amended as follows:
2.1.1 SECTION 4.3. Section 4.3(b) of the Credit
Agreement is amended by deleting the amounts "$12,500,000",
"$13,2000,000" and "$13,500,000" set forth opposite, respectively, the
dates April 30, 1998, July 31, 1998 and October 31, 1998, and
substituting in lieu thereof the following respective amounts:
"$10,250,000", "$10,250,000" and "$10,250,000".
2.1.2 SECTION 4.5. Section 4.5(b) of the Credit
Agreement is amended by deleting the amounts "3.0:1", "3.0:1" and "3.0:1"
set forth opposite, respectively, the dates April 30, 1998, July 31,
1998, and October 31, 1998, and substituting in lieu thereof the
following respective amounts: "2.5:1", "2.5:1" and "2.5:1".
2.1.3 SECTION 4.6. Section 4.6(b) of the Credit
Agreement is amended by: (x) deleting the amounts "3.8:1", "2.7:1" and
"2.3:1" set forth opposite, respectively, the dates April 30, 1998, July
31, 1998, and October 31, 1998, and substituting in lieu thereof the
following respective amounts: "4.0:1", "4.0:1" and "4.0:1"; and (y)
inserting the following sentence as the last sentence thereof: "Provided,
however, solely with respect to the calculation of Total Indebtedness
under this Section 4.6(b) for the periods ending on the dates April 30,
1998, July 31, 1998, and October 31, 1998, the calculation of the
outstanding amount of the Revolving Loans included in such calculation
shall be based upon the average daily balance of the Revolving Loans for
the immediately prior twelve months ending as of such dates."
2.2 A. LIMITED WAIVER TO CONDITION. The requirement set forth
in Section 1.1(C)(6) of the Credit Agreement is waived solely with respect to an
acquisition meeting each of the following conditions: (i) the Target is
[XXXXXXXX MANUFACTURING] and no other Person; (ii) the acquisition of such
Target is completed in full by no later
than June 30, 1998; and (iii) each other pertinent provision of the Credit
Agreement (including, without limitation, each other provision set forth in
Section 1.1(C)) is satisfied in full with respect to the acquisition of such
Target. If the preceding conditions are not satisfied in full, this waiver
shall automatically terminate and be of no effect. This waiver: (i) shall not
establish any custom or practice; and (ii) is specifically limited to the
acquisition of [XXXXXXXX MANUFACTURING] as conditioned above and does not
constitute (and shall not be deemed) a waiver of such Section 1.1(C)(6) with
respect to any other Target or acquisition.
3. CONDITIONS TO EFFECTIVENESS. The effectiveness of this Amendment
shall be subject to the satisfaction of the following conditions in a manner,
form and substance satisfactory to Agent:
3.1 DELIVERY OF DOCUMENTS. This Amendment and, if requested by Agent,
a Reaffirmation Agreement from such Persons as Agent shall specify, shall have
been delivered to Agent, duly authorized and executed, together with such other
instruments, documents, certificates, consents, waivers, opinions and financing
statements as Agent may reasonably request.
3.2 MATERIAL ADVERSE CHANGE. No event shall have occurred since the
Closing Date which has had or reasonably could be expected to have a Material
Adverse Effect.
3.3 PERFORMANCE; NO DEFAULT. Borrower and each Loan Party shall have
performed and complied with all agreements and conditions contained in the Loan
Documents to be performed by or complied with by Borrower prior to the date
hereof, and no Event of Default shall exist.
4. REPRESENTATIONS AND WARRANTIES. Borrower and each Loan Party
hereby confirms to Agent and the Lenders that the representations and warranties
set forth in Section 5 of the Credit Agreement are true and correct in all
material respects as of the date hereof, and shall be deemed to be remade as of
the date hereof.
5. NO FURTHER AMENDMENTS; RATIFICATION OF LIABILITY. Each Loan Party
hereby consents to the execution and delivery of this Amendment. Borrower and
each Loan Party hereby agrees that except as amended hereby, the Credit
Agreement and each of the other Loan Documents shall remain in full force and
effect in accordance with their respective terms. Borrower and each Loan Party
hereby ratifies and confirms its liabilities, obligations and agreements under
the Credit Agreement and each other Loan Document, all as amended by this
Amendment, and acknowledges that: (i) as of the date of this Amendment, such
Loan Party, to its knowledge, has no defenses, claims or set-offs to the
enforcement by Agent of such liabilities, obligations and agreements; and (ii)
other than as specifically set forth herein, Agent does not waive, diminish or
limit any term or condition contained in the Credit Agreement or any of the
other Loan Documents. Agent's agreement to the terms of this Amendment or any
other amendment shall not be deemed to establish or create a custom or course of
dealing between Agent and Borrower or any Loan Party.
6. COUNTERPARTS. This Amendment may be executed in one of more
counterparts, each of which shall be deemed to be an original, and all of which,
when taken together, shall constitute one and the same instrument.
7. FURTHER ASSURANCES AND FEES AND EXPENSES. Each Loan Party
covenants and agrees that it will at any time and from time to time do, execute,
acknowledge and deliver, or will cause to be done, executed, acknowledged and
delivered, all such further acts, documents and instruments as reasonably may be
required by Agent in order to effectuate fully the intent of this Amendment.
The Borrower shall pay all fees and expenses incurred in the preparation,
negotiation and execution of this Amendment, including, without limitation, the
fees and expenses of counsel for Agent.
8. GOVERNING LAW. This Amendment shall be a contract made under and
governed by the laws of the State of Illinois, without regard to conflict of
laws principles.
9. SEVERABILITY. In the event that any provision of this Amendment
is deemed to be invalid by reason of the operation of any law or by reason of
the interpretation placed thereon by any court or governmental authority, this
Amendment shall be construed as not containing such provision and the invalidity
of such provision shall not affect
the validity of any other provisions hereof, and any and all other provisions
hereof which otherwise are lawful and valid shall remain in full force and
effect.
10. HEADINGS AND RECITALS. The paragraph headings used in this
Amendment are for convenience of reference only and in no way define, describe
or limit the scope or intent of this Amendment. The foregoing recitals are
hereby incorporated herein by this reference thereto.
11. PRIOR CONSENT. The terms and conditions of the prior Consent with
respect to Section 3.5 of the Credit Agreement from each of the Lenders to the
Borrower is hereby acknowledged, agreed and reaffirmed.
12. NO STRICT CONSTRUCTION. The language used in this Amendment shall
be deemed to be the language chosen by the parties hereto to express their
mutual intent, and no rule of strict construction shall be applied against any
party hereto.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, this Amendment has been executed and delivered by
each of the parties hereto on the date first set forth above.
UNIONTOOLS, INC., a Delaware corporation
By: /s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
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Title: President
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ACORN PRODUCTS, INC., a Delaware
corporation
By: /s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
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Title: President
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XXXXXX FINANCIAL, INC., a Delaware
corporation, in its individual capacity as a
Lender and as Agent for all Lenders
By: /s/ Xxxxxxx Xxxxxxxx
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Name: Xxxxxxx Xxxxxxxx
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Title: Assistant Vice President
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FLEET CAPITAL CORPORATION
By: /s/ Xxxxxx Xxxxxxxx
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Name: Xxxxxx Xxxxxxxx
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Title: Vice President
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PNC BANK, OHIO, NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
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Title: Vice President
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BANKBOSTON, N.A., (formerly known as The
First National Bank of Boston)
By:
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Name:
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Title:
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STAR BANK, N.A.
By:
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Name:
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Title:
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SANWA BUSINESS CREDIT CORPORATION
By:
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Name:
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Title:
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