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AMENDMENT NO. 5
Dated as of March 25, 1997
This AMENDMENT among U.S. HOMECARE CORPORATION AND ITS SUBSIDIARIES LISTED
IN THE ANNEX 1 HERETO (collectively, the "Borrowers" and each, individually, a
"Borrower"), the banks parties to the Credit Agreement referred to below (the
"Banks"), and THE CHASE MANHATTAN BANK (successor by merger to The Chase
Manhattan Bank, N.A.), as agent (the "Agent") for the Banks thereunder.
PRELIMINARY STATEMENT.
A. The Borrowers, the Banks and the Agent have entered into an Amended
and Restated Credit Agreement dated as of October 6, 1995, as amended by
Amendment No. 1 dated as of October 31, 1996, Amendment No. 2 dated as of
November 14, 1996, Amendment No. 3 dated as of March 25, 1997, and Amendment
No. 4 dated as of December 24, 1997 (said Credit Agreement, as so amended,
being hereinafter referred to as the "Credit Agreement"; the terms defined
therein being used herein as therein defined unless otherwise defined herein).
B. Pursuant to the Credit Agreement, the Borrowers are indebted to the
Banks under the Notes in the aggregate principal amount of $4,043,083.97, as of
the date hereof (the "Indebtedness"), which Indebtedness is owed by the
Borrowers to the Banks without offset, defense or counterclaim of any kind,
nature or description. As security for such Indebtedness, the Borrowers have
heretofore granted to the Banks a first priority security interest in all the
Borrowers' assets (such security interest having been partially released by the
Banks pursuant to the Partial Release Letter dated November 8, 1993), whether
now owed or hereafter acquired, wherever located of any kind, nature or
description, tangible or intangible, including without limitation, the
Borrowers' accounts receivable, inventory, equipment, and general intangibles
and such security interest and liens granted by the Borrowers to the Banks
are, subject to the terms of the Partial Release Letter, hereby reacknowledged
and confirmed by the Borrowers.
C. The Borrowers, the Banks and the Agent have agreed to amend the
Credit Agreement as hereinafter set forth.
SECTION 1. Amendments. The Credit Agreement is, effect as of the
date hereof and subject to the satisfaction of the conditions precedent set
forth in Section 3 hereof, hereby amended as follows:
(a) The following definition contained in Section 1.1 of the Credit
Agreement is amended and restated in full to read as follows:
"Termination Date" means (i) January 4, 1999; provided that if such
date is not a Banking Day, the Termination Date shall be the next
succeeding Banking Day, or (ii) the earlier date of termination in whole of
the Commitments pursuant to Section 2.7 or Section 9.2, or otherwise.
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(b) Paragraphs (a) and (b) of the definition of Borrowing Base
contained in Section 1.1 of the Credit Agreement is amended and restated in
full to read as follows:
(a) the lesser of (i) 85% of Eligible Receivables or (ii) $5,750,000
as such number set forth in this clause (ii) shall reduce in the manner set
forth in paragraph (b) below; plus
(b) an amount equal to (i) $950,774, less (ii) the principal amount
of any reductions in the Commitments occurring after the Closing Date,
whether pursuant to Section 2.7 or otherwise, less (iii) as of the date the
same are collected, fifty percent (50%) of all collections of USHNJ
Receivables other than USHNJ Eligible Receivables and USHNJ Receivables
subject to the Purchase Agreement, less (iv) (A) $25,000 on each of April
30, 1998, May 30, 1998, and June 30, 1998, and (B) $50,000 on the thirtieth
day of each calendar month thereafter; provided that such amount under this
clause (b) shall not be less than zero, and when such amount is reduced to
zero, the reductions set forth in clause (iv) of this paragraph (b) that
have not yet been made shall be applied in reduction of the dollar amount
set forth in clause (ii) of paragraph (a) above; less
(c) Subsection (d) of Section 2.11 is amended and restated in full
to read as follows:
(d) Extension Fee. So long as any of the Notes shall remain unpaid
or any Bank shall have any Commitment under this Agreement at the time any
of the following installments are due, the Borrowers shall pay to the Agent
for the ratable benefit of the Banks an extension fee in installments as
follows: (i) the amount of $135,000 shall be due and payable on May 1,
1998, and (ii) the amount of $50,000 shall be due and payable on September
30, 1998.
(d) The following new Subsection (e) is added at the end of Section
2.11:
(e) Waiver Fee. The Borrowers shall pay to the Agent for the ratable
benefit of the Banks a waiver fee in the amount of $25,000, which shall be
fully earned by the Banks on December 31, 1997, and which shall be payable
on the earlier to occur of (i) March 31, 1998, or (ii) the Termination
Date.
(e) Section 6.13 is amended and restated in full to read as follows:
Section 6.13. Amendment to Purchase Agreement. By March 31, 1998,
enter into an amendment to the Purchase Agreement extending the maturity
date thereof to January 4, 1999, which amendment shall be satisfactory to
the Banks.
SECTION 2. Waivers. Effective as of December 31, 1997, and
subject to the satisfaction of the conditions precedent set forth in Section 3
hereof, the Agent and the
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Banks hereby waive any Default or Event of Default due to the Borrowers'
failure to comply with the covenant contained in Section 8.1 of the Credit
Agreement for the month of December, 1997.
SECTION 3. Conditions of Effectiveness. This Amendment shall
become effective when, and only when, the Agent shall have received
counterparts of this Amendment executed by the Borrowers and all of the Banks,
except that Section 1 hereof shall become effective when, and only when, the
Agent shall have additionally received all of the following documents, each
document (unless otherwise indicated) being dated the date of receipt thereof
by the Agent (which date shall be the same for all such documents), in form and
substance satisfactory to the Banks:
(a) Certified copies of (i) the resolutions of the Board of
Directors or Executive Committee of each Borrower approving this Amendment and
the matters contemplated hereby, (ii) all documents evidencing the other
necessary corporate action and governmental approvals, if any, with respect to
this Amendment and the matters contemplated hereby, and (iii) all waivers and
amendments with respect to the Junior Debt concerning the matters covered by
this Amendment, which shall include an amendment to the Junior Debt documents
extending the maturity date thereof to January 15, 1999.
(b) A certificate of the Secretary or an Assistant Secretary of each
Borrower certifying the names and true signatures of the officers of such
Borrower authorized to sign this Amendment and the other documents to be
delivered hereunder.
(c) A favorable opinion of Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP, counsel
for the Borrowers, to the effect that this Amendment and each and every other
document delivered by any of the Borrowers have been duly authorized, executed
and delivered by such Borrowers, and constitute the legal, valid and binding
obligations of such Borrowers, enforceable against such Borrowers in accordance
with their respective terms, and as to such other matters as the Agent may
reasonably require.
(d) A certificate signed by a duly authorized officer of each
Borrower stating that:
(i) The representations and warranties contained in Section 4
hereof are correct on and as of the date of such certificate as though
made on and as of such date, and
(ii) After giving effect to the terms of the Amendment, no event
has occurred and is continuing which constitutes a Default or an Event
of Default.
(c) Payment to the Agent for the ratable benefit of the Banks, of
(i) a $50,000 extension fee, which shall be fully earned by the Banks on the
date so paid, and (ii) the $20,000 extension fee that, pursuant to Section
2.11(d) of the Credit Agreement, as amended by Amendment No. 4, was to be
payable on the Termination Date.
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(f) Payment to the Agent for the benefit of itself, as a Bank, and
Creditanstalt AG (formerly known as Creditanstalt Bankverein) of a settlement
fee, in an amount equal to the amount set forth below opposite the name of each
such party, to settle in full the overstatement by the Parent of the number of
warrants in favor of such party in the letters from the Parent to each such
party dated March 20, 1997:
NUMBER OF OVERSTATED
BANK WARRANTS SETTLEMENT FEE
The Chase Manhattan Bank 3175 $2000
Creditanstalt AG (formerly
known as Creditanstalt
Bankverein) 2427 $1500
(g) The Parent shall extend the end of the exercise period with
respect to the Warrants described below from October 6, 2000, to March 25,
2002, and shall deliver to the Banks all such documents, and perform all such
acts, as are necessary to cause such extension to be effective in a manner that
is satisfactory to the Banks, in their sole discretion:
WARRANT IDENTIFICATION
WARRANT HOLDER DATE OF ISSUANCE NUMBER
The Chase Manhattan Bank 10/6/95 WA-16
Creditanstalt AG (formerly
known as Creditanstalt
Bankverein) 10/6/95 WA-18
SECTION 4. Representations and Warranties of the Borrowers.
Each Borrower represents and warrants as follows:
(a) Such Borrower is a corporation duly organized and validly
existing under the laws of the jurisdiction of its incorporation.
(b) The execution, delivery and performance by such Borrower of this
Amendment and the Facility Documents, as amended hereby, to which it is or is
to be a party are within such Borrower's corporate powers, have been duly
authorized by all necessary corporate action and do not contravene (i) such
Borrower's charter or by-laws, (ii) any contractual restriction binding on or
affecting such Borrower, or result in, or require, the creation or imposition
of any mortgage, deed of trust, pledge, lien, security interest or other
charge, encumbrance or preferential arrangement of any nature upon or with
respect to any of the properties now owned or hereafter acquired by such
Borrower, or (iii) to the best of such Borrower's knowledge, any law.
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(c) No authorization, approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body is required for
the due execution, delivery and performance by such Borrower of this Amendment
or any of the Facility Documents, as amended hereby, to which it is or is to be
a party.
(d) This Amendment and each of the other Facility Documents as
amended hereby, to which such Borrower is a party constitute legal, valid and
binding obligations of such Borrower enforceable against such Borrower in
accordance with their respective terms.
(e) To the best of such Borrower's knowledge, the Security Agreement
constitutes valid and perfected first priority security interests and liens in
and to the Collateral covered thereby enforceable against all third parties in
all jurisdictions and secure the payment of all obligations of such Borrower
under the Facility Documents, as amended hereby, and the execution, delivery
and performance of this Amendment do not adversely affect the aforesaid
security interests and liens of such Security Agreement.
(f) Except as set forth in Schedule 4(f), there is no pending or
threatened action or proceeding affecting such Borrower or any of its
Subsidiaries before any court, governmental agency or arbitrator, which may
materially adversely affect the financial condition or operations of such
Borrower or any Subsidiary or which purport to affect the legality, validity or
enforceability of this Amendment or any of the other Facility Documents, as
amended hereby.
(g) After giving effect to the terms of the Amendment, no event has
occurred and is continuing which constitutes a Default or an Event of Default.
SECTION 5. Reference to and Effect on the Facility Documents.
(a) Upon the effectiveness of Section 1 hereof, on and after the
date hereof each reference in the Credit Agreement to "this Agreement,"
"hereunder," "hereof," "herein" or words of like import, and each reference in
any Facility Documents to the Credit Agreement or any other Facility Document,
shall mean and be a reference to the Credit Agreement or such other Facility
Document as amended hereby.
(b) Except as specifically amended above, the Credit Agreement and
the other Facility Documents shall remain in full force and effect and are
hereby ratified and confirmed. Without limiting the generality of the
foregoing, the Pledge Agreements and all of the Pledged Collateral described
therein, and the Security Agreement and all of the Collateral described
therein, do and shall continue to secure the payment of all Obligations, in
each case as amended hereby.
(c) The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of the Agent or any Bank under any of the Facility
Documents, nor constitute a waiver of any provision of any of the Facility
Documents.
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(d) The Agent and the Banks are under no obligation to enter into
this Amendment. The Agent's and the Banks' entering into this Amendment shall
not be deemed to limit or hinder any rights of the Agent or any Bank under the
Credit Agreement, nor shall it be deemed to create or infer a course of dealing
between the Agent or any Bank and the Parent or any of the other Borrowers with
regard to any provision of the Credit Agreement.
SECTION 6. Costs, Expenses and Taxes. The Borrowers jointly
and severally agree to pay on demand all costs and expenses of the Agent and
the Banks in connection with the preparation, execution and delivery of this
Amendment and the other instruments and documents to be delivered hereunder,
including, without limitation, the reasonable fees and out-of-pocket expenses
of counsel for the Agent and the Banks with respect thereto and with respect to
advising the Agent and the Banks as to their rights and responsibilities
hereunder and thereunder. The Borrowers further jointly and severally agree to
pay on demand all costs and expenses, if any (including, without limitation,
reasonable counsel fees and expenses), in connection with the enforcement
(whether through negotiations, legal proceedings or otherwise) of this
Amendment and the other instruments and documents to be delivered hereunder,
including, without limitation, reasonable counsel fees and expenses in
connection with the enforcement of rights under this Section 6. In addition,
the Borrowers shall pay any and all stamp and other taxes payable or determined
to be payable in connection with the execution and delivery of this Amendment
and the other instruments and documents to be delivered hereunder, and agrees
to save the Agent and the Banks harmless from and against any and all
liabilities with respect to or resulting from any delay in paying or omission
to pay such taxes.
SECTION 7. Execution in Counterparts. 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 to be an original and all of which taken together shall constitute but
one and the same instrument.
SECTION 8. Governing Law. This Amendment shall be governed by,
and construed 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 to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
Borrowers:
U.S. HOMECARE CORPORATION AND ITS
SUBSIDIARIES LISTED ON ANNEX 1 HERETO
By: /s/ Xxxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Vice President of each of the above
corporations
Banks:
THE CHASE MANHATTAN BANK (successor by
merger to The Chase Manhattan Bank, N.A.)
By:
----------------------------------
Xxxx Xxxxxxxxx
Vice President
CREDITANSTALT CORPORATE FINANCE, INC.
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
Borrowers:
U.S. HOMECARE CORPORATION AND ITS
SUBSIDIARIES LISTED ON ANNEX 1 HERETO
By:
---------------------------------
Name:
Vice President of each of the above
corporations
Banks:
THE CHASE MANHATTAN BANK (successor by
merger to The Chase Manhattan Bank, N.A.)
By: /s/ Xxxx Xxxxxxxxx
----------------------------------
Xxxx Xxxxxxxxx
Vice President
CREDITANSTALT CORPORATE FINANCE, INC.
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
Borrowers:
U.S. HOMECARE CORPORATION AND ITS
SUBSIDIARIES LISTED ON ANNEX 1 HERETO
By:
---------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Vice President of each of the above
corporations
Banks:
THE CHASE MANHATTAN BANK (successor by
merger to The Chase Manhattan Bank, N.A.)
By:
----------------------------------
Xxxx Harlaczyi
Vice President
CREDITANSTALT CORPORATE FINANCE, INC.
By: /s/ X.X. Xxxxxx
----------------------------------
Name: X.X. Xxxxxx
Title: Vice President
By: /s/ Perm Halter
----------------------------------
Name: Perm Halter
Title: Vice President
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Agent:
THE CHASE MANHATTAN BANK (successor by
merger to The Chase Manhattan Bank, N.A.)
By: /s/ Xxxx Harlaczyi
---------------------------------
Xxxx Harlaczyi
Vice President
