EXHIBIT 10(K)
EXECUTION COPY
FIRST AMENDMENT TO
PARTS AGREEMENT
THIS FIRST AMENDMENT TO PARTS AGREEMENT, dated as of November 4, 2004
(the "Amendment"), is made by and between UNIVERSAL FOREST PRODUCTS RMS, LLC, a
Michigan limited liability company ("Client"), UNIVERSAL FOREST PRODUCTS, INC.,
a Michigan corporation ("Guarantor") and BANK OF AMERICA, N.A. ("BANA"). All
capitalized terms used herein unless otherwise defined shall have the meanings
set forth in the PARTS Agreement referred to below.
RECITALS:
A. Client, Guarantor and BANA are parties to that certain PARTS
Agreement dated as of September 22, 2003 (as amended, restated, modified or
supplemented from time to time, the "PARTS Agreement").
B. Client, Guarantor and BANA have agreed to amend the PARTS
Agreement as set forth herein.
NOW, THEREFOR, the parties hereto agree as follows:
1. The PARTS Agreement is hereby amended by adding the words "and
subject to Section 3(e)" immediately following the words "Termination Date" in
the proviso contained in Section 1(b)(4).
2. The PARTS Agreement is hereby amended by amending and restating
Section 3 in its entirety as follows:
"(a) Servicer shall be entitled to a Servicing fee from BANA
as set forth in Section 6.
(b) The parties hereto acknowledge and agree that (i) the
discount rate paid by BANA for Purchased Receivables, as reflected in
the Purchase Price set forth on each Schedule A, has been negotiated
based upon a certain spread (e.g., 100 bps) in excess of a reference
rate for BANA's cost of funds (commonly referred to as the London
Interbank Offered Rate or "LIBOR") for an initial specified term agreed
to by the parties prior to the Effective Date (it being understood that
such initial specified term is the period running from the relevant
Effective Date to the first Reset Date), (ii) that such spread and
reference rate (e.g., "1 month LIBOR") has been (or will be) disclosed
to Client, and consented to by Client, prior to any applicable
Effective Date and (iii) upon each Reset Date, Client will pay to BANA
an amount (the "Reset Date Payment") equal to: P * (L+XY.Z bps) *
Ndays/360, where "P" equals the aggregate face amount of Purchased
Receivables (other than "Delinquent Receivables," as defined below)
outstanding on such Reset Date multiplied by a percentage equal to 100%
less the Agreed Dilution
Percentage; "L" equals LIBOR for the period running from such
Reset Date to the next succeeding Reset Date (or, if earlier, the
Termination Date), as calculated by BANA two business days prior to
such Reset Date; "XY.Z bps" equals the spread over LIBOR that was used
by BANA in calculating the discount rate incorporated into the
applicable Purchase Price on the relevant Effective Date (i.e., trade
inception); and "Ndays" equals the number of actual days between such
Reset Date and the next succeeding Reset Date (or, if earlier, the
Termination Date). BANA shall notify Client two business days prior to
each Reset Date of (x) the relevant LIBOR rate for the specified term
commencing on such Reset Date and (y) the amount of the Reset Date
Payment owing by Client to BANA on such Reset Date pursuant to this
Section 3(b), and Client agrees to pay to BANA on such Reset Date such
Reset Date Payment. BANA shall provide Client with reasonable detail of
the manner in which any amount payable under this Section 3(b) was
calculated, and BANA's determination of any such amount shall be
conclusive in the absence of manifest error. Each Reset Date Payment
made hereunder shall be applied by BANA as follows: (i) with respect to
Purchased Receivables other than Purchased Receivables with respect to
which a Repurchase Event shall have occurred, the applicable portion of
each Reset Date Payment shall be applied as an adjustment to the
Purchase Price paid by BANA therefor; and (ii) with respect to
Purchased Receivables with respect to which a Repurchase Event shall
have occurred, the applicable portion of each Reset Date Payment shall
be applied toward the repurchase obligation of Client, pursuant to
Section 9(a), with respect to such Purchased Receivable. As used in
this Section, "Delinquent Receivables" are Purchased Receivables with
respect to which: (I) such Purchased Receivables shall be more than 15
day past due; and (ii) either (A) Client shall have demonstrated to
BANA, in accordance with Section 1(b)(7), that the delinquency in
payment on such receivables is not the result of a Repurchase Event; or
(B) the Purchased Receivables shall be past due as a result of a
Financial Inability to Pay.
(c) In the event that, this Agreement is terminated by BANA
pursuant to Section 2(a) or is terminated by Client for any reason
prior to the occurrence of one or more Reset Dates initially
contemplated to occur during the term of this Agreement in connection
with any Schedule A (including without limitation as the result of
BANA's acceleration of the date on and after which Client can no longer
use Remittances to purchase Replacement Receivables under such Schedule
A as set forth in the definition of "Termination Date"), Client shall
pay to BANA a hedging cost breakage fee as calculated by BANA in a
commercially reasonable manner using the principles set forth in this
Section 3 (it being understood and agreed that such hedging cost
breakage fee may include the expected Structuring Fee for each Reset
Date that has not yet occurred, as calculated by BANA in a commercially
reasonable manner). BANA shall provide Client with reasonable detail of
the manner in which any amount payable under this Section 3 was
calculated, and BANA's determination of any such amount shall be
conclusive in the absence of manifest error.
(d) In connection with the Receivables purchase program
reflected by each Schedule A, Client shall pay BANA on the relevant
Effective Date and each Reset Date a Structuring Fee in the dollar
amount specified on the relevant Schedule A, which fee shall be wired
to BANA's account identified in Section 1(b)(2)(ii).
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(e) If a particular Schedule A includes an annex indicating
a different agreed upon Required Amount for each Reset Date following
the Effective Date, then on (or prior to) each Reset Date prior to the
Termination Date Client, Guarantor and BANA shall execute a new
supplemental Schedule A (denoted "Schedule A-__(__)"; e.g., "Schedule
A-5(b)"), which supplemental Schedule A shall be deemed to amend and
restate the initial Schedule A (e.g., "Schedule A-5(a)"), and any
subsequent Schedule As, to which such supplement relates. Such
supplemental Schedule A will reference the same Account Debtor and
Stated Termination Date, but will include a new Effective Date (which
shall be the relevant Reset Date), Required Amount (per the annex to
the relevant initial Schedule A), Purchase Price (which shall be
subject to adjustment pursuant to Section 3(b)) and Structuring Fee,
and may include a different Agreed Dilution Percentage and/or other
terms as negotiated and mutually agreed upon by the parties. In the
event that the new Required Amount on the applicable Reset Date is less
than the immediately preceding applicable Required Amount, then the new
Required Amount shall constitute a cap on the amount of Remittances
that may be used by Client to purchase Replacement Receivables, and the
Remittances from Purchased Receivables purchased by BANA pursuant to a
prior Schedule A that are not applied to Replacement Receivables
(including because such application would cause the amount of Purchased
Receivables to exceed the then-applicable Required Amount) shall be
remitted to BANA in accordance with Section 1(b)(4). In the event that
the new Required Amount on the applicable Reset Date is greater than
the immediately preceding applicable Required Amount, then the amount
by which the new Required Amount exceeds the immediately preceding
applicable Required Amount shall constitute additional Receivables to
be purchased by BANA hereunder, which purchase shall be funded by BANA
to Client on the applicable Reset Date at the applicable Purchase Price
percentage set forth on the relevant supplemental Schedule A."
3. The PARTS Agreement is hereby amended by amending and restating
Section 4(b)(vii) in its entirety as follows:
"(vii) no such Receivable is or shall otherwise be subject to, any
offset, counterclaim, contra account or any defense of any kind or character
with respect to any such Receivable (collectively, "Credits") that would cause
the aggregate amount of all Credits with respect to all Purchased Receivables
purchased by BANA under a particular Schedule A to exceed the Agreed Dilution
Percentage;"
4. The PARTS Agreement is hereby amended by (a) deleting the word
"or" at the end of Section 5(f)(xiv), (b) adding the word "or" at the end of
Section 5(f)(xv) and (c) adding the following new subsection (xvi) to the end of
Section 5(f):
"(xvi) an Event of Default shall have occurred hereunder."
5. Section 6(a) of the PARTS Agreement is hereby amended by
deleting the fifth full sentence thereof (beginning with the words "In
consideration of . . .") in its entirety, and substituting therefor the
following two new sentences: "In consideration of the performance by Servicer of
its obligations hereunder with respect to Purchased Receivables under a
particular Schedule A, Servicer shall be entitled to receive the Servicing Fee
from BANA. Such Servicing
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Fee: (A) shall be calculated with respect to each Schedule A or supplemental
Schedule A, on a per annum basis, based upon the Required Amount stated in such
Schedule A or supplemental Schedule A and the period of time between the
Effective Date stated in such Schedule A or supplemental Schedule A and the
earlier of the Termination Date or the next succeeding Reset Date; and (B) shall
be payable in advance with respect to each Schedule A or supplemental Schedule
A, on or prior to the Effective Date thereof."
6. The PARTS Agreement is hereby amended by amending and restating
the notice information for BANA in Section 16 in its entirety as follows:
"If to BANA, at: Bank of America, N.A.
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx
Telephone: 000-000-0000
Telecopy: 000-000-0000
Email: xxxxxxx.x.xxxxx@xxxxxxxxxxxxx.xxx
With a copy to: Bank of America, N.A.
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
NY1-040-27-01
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx
Telephone: 000-000-0000
Telecopy: 000-000-0000
Email: Xxxxxx.Xxxxxx@xxxxxxxxxxxxx.xxx"
7. The PARTS Agreement is hereby amended by amending and restating
the definitions below as follows:
"Agreed Base Value: With respect to any Purchased
Receivables, an amount equal to the
product of (a) the face amount of such
Receivables, times (b) a percentage
equal to 100% less the Agreed Dilution
Percentage."
Servicing Fee: With respect to Purchased Receivables
under a particular Schedule A or
supplemental Schedule A, the amount
determined by multiplying (a) the
Required Amount listed on the
applicable Schedule A or supplemental
Schedule A, times (b) a fraction, the
numerator of which shall be determined
by multiplying (x) the per annum
percentage listed as the Servicing Fee
on the applicable Schedule A or
supplemental Schedule A times (y) the
number of days in the period from the
relevant Effective Date to the earlier
of the next Reset Date or the relevant
Termination Date, and the denominator
of which shall be 360."
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8. The PARTS Agreement is hereby amended by adding the following
new definitions to Annex I thereof in their proper alphabetical order:
"Agreed Dilution 7.5% or such other percentage set
Percentage: forth after such term on the
applicable Schedule A, which
represents the agreed level of Credits
(expressed as a percentage of the face
amount of the relevant Purchased
Receivables) that may exist with
respect to the Purchased Receivables
of a particular Approved Account
Debtor.
Delinquent As defined in Section 3(b) of the
Receivables: Agreement.
Repurchase Event: As defined in Section 1(b)(7) of the
Agreement.
Reset Date: With respect to Purchased Receivables
under a particular Schedule A, the
last day of each of fiscal month of
Client and Guarantor to occur prior to
the relevant Stated Termination Date
as more fully set forth on the
applicable Schedule A; provided,
however, that if such Reset Date is
not a business day then such Reset
Date shall be the next succeeding
business day."
Reset Date Payment: As defined in Section 3(b) of the
Agreement.
Structuring Fee: The dollar amount set forth after
such term in the applicable Schedule
A, which represents the non-refundable
structuring fee payable to BANA on the
Effective Date and each Reset Date
with respect to the Receivables
purchase program reflected by such
Schedule A."
9. The PARTS Agreement is hereby amended by amending and restating
the Form of Schedule A attached thereto in its entirety as set forth in Exhibit
A hereof.
10. This Amendment shall become effective on the date set forth
above in the introductory paragraph upon BANA's receipt of counterparts of this
Amendment, each duly executed and delivered by Client, Guarantor and BANA.
11. Except as hereby modified, all the terms and provisions of the
PARTS Agreement and any schedules or exhibits thereto remain in full force and
effect. BANA's execution and delivery of this Amendment and any other documents
and instruments in connection herewith shall not be deemed to create a course of
dealing or otherwise create any express or implied duty by it to provide any
other or further amendments, waivers or consents in the future.
12. Client hereby represents and warrants that (a) it has the
requisite corporate power and authority to execute, deliver and perform this
Amendment, (b) it is duly authorized to, and has been authorized by all
necessary corporate action to, execute, deliver and perform this Amendment,
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(c) the representations and warranties contained in Section 4 of the PARTS
Agreement are, subject to the limitations set forth therein, true and correct in
all material respects on and as of the date hereof as though made on and as of
such date (except for those which expressly relate to an earlier date), and (d)
no Event of Default or Servicer Default exists under the PARTS Agreement on and
as of the date hereof or will occur as a result of the transactions contemplated
hereby.
13. This Amendment may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed an original, and it
shall not be necessary in making proof of this Amendment to produce or account
for more than one counterpart. Delivery of executed counterparts by telecopy
shall be effective as an original and shall constitute a representation that an
original will be delivered.
14. THIS AMENDMENT AND ALL OTHER DOCUMENTS EXECUTED PURSUANT TO THE
TRANSACTIONS CONTEMPLATED HEREIN SHALL BE DEEMED TO BE CONTRACTS MADE UNDER, AND
FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS AND
JUDICIAL DECISIONS OF THE STATE OF NEW YORK.
15. Client understands and acknowledges that the form and terms of
the PARTS Agreement (including this Amendment) are proprietary trade products of
BANA that BANA desires to keep confidential and Client agrees that, except for
disclosure on a confidential basis (a) to Client's accountants, attorneys and
other professional advisors retained by it in connection with the PARTS
Agreement and (b) as may be required by law, the form and terms of the PARTS
Agreement shall not be disclosed by Client in whole or in part to any other
person or entity without BANA's prior written consent.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their fully authorized officers as of the day and year first above
written.
UNIVERSAL FOREST PRODUCTS RMS, LLC
By:
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Name:
Title:
UNIVERSAL FOREST PRODUCTS, INC.
By:
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Name:
Title:
BANK OF AMERICA, N.A.
By:
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Name:
Title:
