OMNIBUS AMENDMENT AGREEMENT
Exhibit 10.1
EXECUTION VERSION
THIS OMNIBUS AMENDMENT AGREEMENT (this “Amendment”) is made and entered into as of
February 28, 2011, and shall be effective as of February 28, 2011 upon the satisfaction of all of
the conditions to effectiveness set forth in Article IV hereof (the “Effective Date”) by
and between XXXXXXX INTERNATIONAL, INC., a Nevada corporation (“Xxxxxxx”), HB SERVICE, LLC,
a Delaware limited liability company (“HB Service”), and XXXXX FARGO BANK, NATIONAL
ASSOCIATION (as successor by merger to Wachovia Bank, National Association) (the “Bank”)
and the other Persons party hereto.
BACKGROUND STATEMENT
X. Xxxxxxx and the Bank are parties to a Credit Agreement, dated as of November 14, 2005, as
amended by that certain First Amendment to Credit Agreement dated as of April 26, 2006, by that
certain Second Amendment and Waiver to Credit Agreement dated as of September 8, 2006, by that
certain Third Amendment and Waiver to Credit Agreement dated as of March 21, 2008, by that certain
Fourth Amendment and Waiver to Credit Agreement dated as of June 25, 2008, by that certain Fifth
Amendment and Waiver to Credit Agreement dated as of June 30, 2009, by that certain Sixth Amendment
to Credit Agreement, dated as of November 18, 2009, by that certain Omnibus Amendment Agreement,
Limited Consent and Waiver, dated as of August 13, 2010, by that certain Omnibus Amendment
Agreement, Limited Consent and Waiver, dated as of October 28, 2010, by the Omnibus Amendment
Agreement, dated as of November 5, 2010, and by the Omnibus Amendment Agreement, dated as of
February 14, 2011 (the “Xxxxxxx Credit Agreement”), pursuant to which the Bank has made
available to Xxxxxxx a revolving credit facility in the aggregate principal amount of $10,000,000.
As of the date hereof, the current outstanding principal amount of the loans outstanding under the
Xxxxxxx Credit Agreement is $ 9,946,932.41, and pursuant to the terms of the Xxxxxxx Credit
Agreement, the current Applicable Margin (as defined in the Xxxxxxx Credit Agreement) is 2.85%.
The obligations of Xxxxxxx under the Xxxxxxx Credit Agreement have been guaranteed by (i) the
Subsidiary Guarantors (as defined in the Xxxxxxx Credit Agreement) pursuant to the Guaranty (as
defined in the Xxxxxxx Credit Agreement), (ii) HB Service and its subsidiaries pursuant to the HB
Service Guaranty (as defined in the Xxxxxxx Credit Agreement) (iii) H. Xxxxx Xxxxxxxx
(“Xxxxxxxx”) pursuant to the guaranty agreement made by Xxxxxxxx in favor of the Bank,
dated as of June 25, 2008 (as amended from time to time, the “Xxxxxxxx Xxxxxxx Guaranty”),
and (iv) Xxxxxxx Hygiene Inc. (“Xxxxxxx Hygiene”), pursuant to the guaranty agreement made
by Xxxxxxx Hygiene, dated as of November 23, 2010, subject to the terms and conditions therein.
The obligations of Xxxxxxx under the Xxxxxxx Credit Agreement have been secured by a lien on the
assets of Xxxxxxx and the Subsidiary Guarantors and HB Service and it subsidiaries pursuant to the
terms of the Security Agreement and the HB Service Security Agreement (each as defined in the
Xxxxxxx Credit Agreement), respectively.
B. HB Service and the Bank are parties to a Credit Agreement, dated as of June 25, 2008, as
amended by that certain First Amendment and Waiver to Credit Agreement dated as of June 30, 2009,
by that certain Second Amendment to Credit Agreement dated as of November 18, 2009, by that certain
Omnibus Amendment Agreement, Limited Consent and Waiver, dated
as of August 13, 2010, by that certain Omnibus Amendment Agreement, Limited Consent and
Waiver, dated as of October 28, 2010, by the Omnibus Amendment Agreement, dated as of November 5,
2010, and by the Omnibus Amendment Agreement, dated as of February 14, 2011 (the “HB Service
Credit Agreement”), pursuant to which the Bank has made available to HB Service a revolving
credit facility in the aggregate principal amount of $15,000,000. As of the date hereof, the
current outstanding principal amount of the loans outstanding under the HB Service Credit Agreement
is $15,000,000, and pursuant to the terms of the HB Service Credit Agreement, the current
Applicable Margin (as defined in the HB Service Credit Agreement) as of the date hereof is 1.50%.
The obligations of HB Service under the HB Service Credit Agreement have been guaranteed by (i)
Xxxxxxxx pursuant to the guaranty agreement made by Xxxxxxxx in favor of the Bank, dated as of
June 25, 2008 (as amended from time to time, the “Xxxxxxxx XX Service Guaranty”), and (ii)
Xxxxxxx Hygiene, pursuant to the guaranty agreement made by Xxxxxxx Hygiene, dated as of November
23, 2010.
C. Concurrently with the execution hereof, (1) the Bank is releasing Xxxxxxxx from the
Xxxxxxxx Xxxxxxx Guaranty and the Xxxxxxxx XX Service Guaranty, and (2) HB Service and Xxxxxxx are
causing cash in the amount of $15,000,000 to be deposited by Xxxxxxx into an account at the Bank,
and a security interest in such amount to be granted to Bank, to secure the obligations of HB
Service and Xxxxxxx to the Bank under the HB Service Credit Agreement and the Xxxxxxx Credit
Agreement, pursuant to the Security Agreement, dated as of the date hereof (the “Account
Security Agreement”); provided such Account Security Agreement (and the liens created
thereby) shall be immediately and automatically terminated upon consummation of the Private
Placement and the Choice Acquisition (as defined herein) and delivery to the Bank of a certificate,
executed by the Chief Financial Office of Xxxxxxx Hygiene, certifying that as of the consummation
of the Private Placement and the Choice Acquisition, and immediately after giving effect thereto,
Xxxxxxx Hygiene and its Subsidiaries has in excess of $37,500,000 in cash.
X. Xxxxxxx and HB Service have requested certain amendments to the Xxxxxxx Credit Agreement
and the HB Service Credit Agreement, respectively, and the Bank has agreed to make such amendments
on the terms and subject to the conditions set forth herein.
STATEMENT OF AGREEMENT
NOW, THEREFORE, in consideration of the foregoing premises, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
ARTICLE I
AMENDMENTS TO XXXXXXX CREDIT AGREEMENT
1.1 Amendments to Section 1.1 (Defined Terms) of the Xxxxxxx Credit Agreement.
(a) The definition of “Consolidated EBITDA” is hereby deleted in its entirety and replaced
with the following:
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“Consolidated EBITDA” shall mean, of any Person for any
period, the aggregate of (i) Consolidated Net Income of such Person
for such period plus (ii) the sum of depreciation, amortization of
intangible assets, interest expense, and income tax expense for
such period, plus (iii) nonrecurring costs and expenses incurred in
connection with the Coolbrands Merger not to exceed $5,100,000,
plus (iv) nonrecurring costs and expenses incurred in connection
with the Private Placement and the Choice Acquisition not to exceed
$3,500,000, plus (v) additional add-backs in connection with
Permitted Acquisitions, provided the Bank has given its prior
written consent to such add back, plus (vi) compensation paid by
Xxxxxxx Hygiene in the form of stock of Xxxxxxx Hygiene, all to the
extent taken into account in the calculation of Consolidated Net
Income for such period.
(b) The definition of “Revolving Credit Termination Date” is hereby deleted in its entirety
and replaced with the following:
“Revolving Credit Termination Date” shall mean the date of
the earliest to occur of the following: (i) January 15, 2012; (ii)
the date on which the Bank makes demand for payment of the
Revolving Loans in accordance with Article VIII; (iii) such date of
termination as is mutually agreed upon by the Bank and the
Borrower; and (iv) the date after all Obligations have been paid in
full and the Bank is no longer obligated to make Revolving Loans
hereunder.
(c) The following defined term is hereby added in appropriate alphabetical order:
“Choice Acquisition” shall have the meaning given to such
term in the Omnibus Amendment Agreement, dated as of February 28,
2011, between the Borrower, the Bank and certain other parties
thereto.
“Private Placement” shall have the meaning given to such
term in the Omnibus Amendment Agreement, dated as of February 28,
2011, between the Borrower, the Bank and certain other parties
thereto
“Xxxxxxx Hygiene” shall mean Xxxxxxx Hygiene Inc., a
Delaware corporation and ultimate parent company of the Borrower.
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1.2 Amendments to Section 5.1 (Financial and Business Information) of the Xxxxxxx Credit
Agreement. Subsections (a), (b) and (c) of Section 5.1 of the Xxxxxxx Credit Agreement are
hereby deleted in their entirety and replaced with the following:
(a) Within forty-five (45) days after the close of each of the first
three Fiscal Quarters of each Fiscal Year of Xxxxxxx Hygiene,
beginning with the Fiscal Quarter ending March 31, 2011, a
consolidated balance sheet of Xxxxxxx Hygiene and its Subsidiaries,
on a consolidated basis, as of the close of such Fiscal Quarter, and
consolidated statements of income and cash flows for Xxxxxxx Hygiene
and its Subsidiaries, on a consolidated basis, for the Fiscal
Quarter then ended and for that portion of the Fiscal Year then
ended, all in reasonable detail setting forth in comparative form
the corresponding figures for the preceding Fiscal Year, all
prepared in accordance with GAAP applied on a basis consistent with
that of the preceding period or containing disclosure of the effect
on the financial position or results of operation of any change in
the application of accounting principles and practices during the
period, subject only to audit and year-end adjustments, and
certified by Xxxxxxx Hygiene’s president or chief financial officer
to be true and accurate; provided that the financial statements
required to be delivered pursuant to this Section 5.1(a) may be
delivered electronically and, if so delivered, shall be deemed to
have been delivered on the date on which the such information has
been posted on Xxxxxxx Hygiene’s website on the Internet at
xxxx://xxx.xxxxxxxxxxxxxx.xxx, at xxx.xxx.xxx/
xxxxx/searchedgar/webusers.htm or at another website identified in a
written notice to the Bank by Borrower;
(b) Within one hundred twenty (120) days after the
close of each Fiscal Year of Xxxxxxx Hygiene, beginning with
the fiscal year ending December 31, 2010, an audited
consolidated balance sheet of Xxxxxxx Hygiene and its
Subsidiaries, on a consolidated basis, as of the close of such
Fiscal Year, and audited consolidated statements of income and
cash flows for Xxxxxxx Hygiene and its Subsidiaries, on a
consolidated basis, for the Fiscal Year then ended, including
the notes to each, all in reasonable detail setting forth in
comparative form the corresponding figures for the preceding
Fiscal Year, each audited by an independent certified public
accountant reasonably acceptable to the Bank, in accordance
with GAAP applied on a basis consistent with that of the
preceding year or containing disclosure of the effect on the
financial position or results of operation of any change in the
application of accounting principles and practices during the
year, and each accompanied by a report thereon by such
certified public accountant containing an opinion that is not
qualified with respect to scope limitations imposed by Xxxxxxx
Hygiene, or any of its Subsidiaries or with respect to
accounting principles followed by such entity not in accordance
with GAAP; provided that the financial statements required to
be delivered pursuant to this Section 5.1(b) may be delivered
electronically and, if so delivered, shall be deemed to have
been delivered on the date on which the such information has
been posted on Xxxxxxx Hygiene’s website
on the Internet at xxxx://xxx.xxxxxxxxxxxxxx.xxx, at
xxx.xxx.xxx/xxxxx/xxxxxxxxxxx/xxxxxxxx.xxx or at another website
identified in a written notice to the Bank by Borrower;
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(c) Concurrently with the delivery of the financial statements
described in subsection (b) above, a certificate addressed to the
Bank from the Chief Financial Officer of the Borrower certifying
that he has no knowledge of the occurrence or existence of any
Default or Event of Default under this Agreement, or specifying the
nature and period of existence of any such Default or Event of
Default;
1.3 Amendment to Article VI of the Xxxxxxx Credit Agreement (Financial Covenants).
Article VI of the Xxxxxxx Credit Agreement is hereby deleted in its entirety and replaced with the
following:
ARTICLE VI
FINANCIAL COVENANTS
The Borrower covenants and agrees that, until payment in full
of all Obligations of the Borrower to the Bank, the Borrower will
not:
6.1 Unencumbered Liquidity. Following the termination of
the Security Agreement, dated as of February 28, 2010, pursuant to
its terms, permit Xxxxxxx Hygiene and its Subsidiaries to maintain,
at any time, unencumbered cash and Cash Equivalents less than
$10,000,000.
6.2 Consolidated EBITDA. Permit the Consolidated EBITDA of
Xxxxxxx Hygiene and its Subsidiaries on a consolidated basis
(calculated on a pro forma basis as if all Acquisitions consummated
during the relevant measurement period had been consummated on the
first day of such period), (i) for the period of the four
consecutive Fiscal Quarters ending on June 30, 2011, to be less than
$5,000,000, (ii) for the period of the four consecutive Fiscal
Quarters ending as of September 30, 2011, to be less than
$7,000,000.
1.4 Other Amendments to the Xxxxxxx Credit Agreement. For purposes of the
representations, warranties, covenants and Events of Default in the Xxxxxxx Credit Agreement, all
references to the Borrower and its Subsidiaries shall be deemed to include Xxxxxxx Hygiene and its
Subsidiaries.
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ARTICLE II
AMENDMENTS TO HB SERVICE CREDIT AGREEMENT
2.1 Amendments to Section 1.1 (Defined Terms) of the HB Service Credit Agreement.
(a) The definition of “Consolidated EBITDA” is hereby deleted in its entirety and replaced
with the following:
“Consolidated EBITDA” shall mean, of any Person for any
period, the aggregate of (i) Consolidated Net Income of such Person
for such period plus (ii) the sum of depreciation, amortization of
intangible assets, interest expense, and income tax expense for
such period, plus (iii) nonrecurring costs and expenses incurred in
connection with the Coolbrands Merger not to exceed $5,100,000,
plus (iv) nonrecurring costs and expenses incurred in connection
with the Private Placement and the Choice Acquisition not to exceed
$3,500,000, plus (v) additional add-backs in connection with
Permitted Acquisitions, provided the Bank has given its prior
written consent to such add back, plus (vi) compensation paid by
Xxxxxxx Hygiene in the form of stock of Xxxxxxx Hygiene, all to the
extent taken into account in the calculation of Consolidated Net
Income for such period.
(b) The definition of “Revolving Credit Termination Date” is hereby deleted in its entirety
and replaced with the following:
“Revolving Credit Termination Date” shall mean the date of
the earliest to occur of the following: (i) January 15, 2012; (ii)
the date on which the Bank makes demand for payment of the Revolving
Loans in accordance with Article VIII; (iii) such date of
termination as is mutually agreed upon by the Bank and the Borrower;
and (iv) the date after all Obligations have been paid in full and
the Bank is no longer obligated to make Revolving Loans hereunder.
(c) The following defined term is hereby added in appropriate alphabetical order:
“Choice Acquisition” shall have the meaning given to such
term in the Omnibus Amendment Agreement, dated as of February 28,
2011, between the Borrower, the Bank and certain other parties
thereto.
“Private Placement” shall have the meaning given to such
term in the Omnibus Amendment Agreement, dated as of February 28,
2011, between the Borrower, the Bank and certain other parties
thereto
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“Xxxxxxx Hygiene” shall mean Xxxxxxx Hygiene Inc., a
Delaware corporation and ultimate parent company of the Borrower.
2.2 Amendments to Section 5.1 (Financial and Business Information) of the HB Service
Credit Agreement. Subsections (a), (b) and (c) of Section 5.1 of the HB Service Credit
Agreement are hereby deleted in their entirety and replaced with the following:
(a) Within forty-five (45) days after the close of each of the first
three Fiscal Quarters of each Fiscal Year of Xxxxxxx Hygiene,
beginning with the Fiscal Quarter ending March 31, 2011, a
consolidated balance sheet of Xxxxxxx Hygiene and its Subsidiaries,
on a consolidated basis, as of the close of such Fiscal Quarter, and
consolidated statements of income and cash flows for Xxxxxxx Hygiene
and its Subsidiaries, on a consolidated basis, for the Fiscal
Quarter then ended and for that portion of the Fiscal Year then
ended, all in reasonable detail setting forth in comparative form
the corresponding figures for the preceding Fiscal Year, all
prepared in accordance with GAAP applied on a basis consistent with
that of the preceding period or containing disclosure of the effect
on the financial position or results of operation of any change in
the application of accounting principles and practices during the
period, subject only to audit and year-end adjustments, and
certified by Xxxxxxx Hygiene’s president or chief financial officer
to be true and accurate; provided that the financial statements
required to be delivered pursuant to this Section 5.1(a) may be
delivered electronically and, if so delivered, shall be deemed to
have been delivered on the date on which the such information has
been posted on Xxxxxxx Hygiene’s website on the Internet at
xxxx://xxx.xxxxxxxxxxxxxx.xxx, at xxx.xxx.xxx/xxxxx/xxxxxxxxxxx/xxxxxxxx.xxx or at another website identified in a
written notice to the Bank by Borrower;
(b) Within one hundred twenty (120) days after the
close of each Fiscal Year of Xxxxxxx Hygiene, beginning with
the fiscal year ending December 31, 2010, an audited
consolidated balance sheet of Xxxxxxx Hygiene and its
Subsidiaries, on a consolidated basis, as of the close of such
Fiscal Year, and audited consolidated statements of income and
cash flows for Xxxxxxx Hygiene and its Subsidiaries, on a
consolidated basis, for the Fiscal Year then ended, including
the notes to each, all in reasonable detail setting forth in
comparative form the corresponding figures for the preceding
Fiscal Year, each prepared by an independent certified public
accountant reasonably acceptable to the Bank, in accordance
with GAAP applied on a basis consistent with that of the
preceding year or containing disclosure of the effect on the
financial position or results of operation of any change in the
application of accounting principles and practices during the
year,
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and each accompanied by a report thereon by such certified public
accountant containing an opinion that is not qualified with respect
to scope limitations imposed by Xxxxxxx Hygiene, or any of its
Subsidiaries or with respect to accounting principles followed by
such entity not in accordance with GAAP; provided that the financial
statements required to be delivered pursuant to this Section 5.1(b)
may be delivered electronically and, if so delivered, shall be
deemed to have been delivered on the date on which the such
information has been posted on Xxxxxxx Hygiene’s website on the
Internet at xxxx://xxx.xxxxxxxxxxxxxx.xxx, at www.sec.
gov/xxxxx/searchedgar/webusers.htm or at another website identified in a written notice to the Bank by Borrower;
gov/xxxxx/searchedgar/webusers.htm or at another website identified in a written notice to the Bank by Borrower;
(c) Concurrently with the delivery of the financial statements
described in subsection (b) above, a certificate addressed to the
Bank from the Chief Financial Officer of the Borrower certifying
that he has no knowledge of the occurrence or existence of any
Default or Event of Default under this Agreement, or specifying the
nature and period of existence of any such Default or Event of
Default;
2.3 Amendment to Article VI of the HB Service Credit Agreement (Financial Covenants).
Article VI of the HB Service Credit Agreement is hereby deleted in its entirety and replaced with
the following:
ARTICLE VI
FINANCIAL COVENANTS
The Borrower covenants and agrees that, until payment in full
of all Obligations of the Borrower to the Bank, the Borrower will
not:
6.1 Unencumbered Liquidity. Following the termination of
the Security Agreement, dated as of February 28, 2010, pursuant to
its terms, permit Xxxxxxx Hygiene and its Subsidiaries to maintain,
at any time, unencumbered cash and Cash Equivalents less than
$10,000,000.
6.2 Consolidated EBITDA. Permit the Consolidated EBITDA of
Xxxxxxx Hygiene and its Subsidiaries on a consolidated basis
(calculated on a pro forma basis as if all Acquisitions consummated
during the relevant measurement period had been consummated on the
first day of such period), (i) for the period of the four
consecutive Fiscal Quarters ending on June 30, 2011, to be less than
$5,000,000, (ii) for the period of the four consecutive
Fiscal Quarters ending as of September 30, 2011, to be less than
$7,000,000.
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2.4 Other Amendments to the HB Service Credit Agreement. For purposes of the
representations, warranties, covenants and Events of Default in the HB Service Credit Agreement,
all references to the Borrower and its Subsidiaries shall be deemed to include Xxxxxxx Hygiene and
its Subsidiaries.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each of Xxxxxxx and HB Service hereby represents and warrants that:
3.1 Representations in Credit Agreement. The representations and warranties of
Xxxxxxx set forth in the Xxxxxxx Credit Agreement and of HB Service set forth in the HB Service
Credit Agreement are true and correct in all material respects as of the date hereof, except to the
extent such representations and warranties relate solely to or are specifically expressed as of a
particular date or period.
3.2 Compliance with Credit Agreement. After giving effect to this Amendment, each of
HB Service and Xxxxxxx is in compliance with all covenants, terms and provisions set forth in the
HB Service Credit Agreement and the Xxxxxxx Credit Agreement, respectively, to be observed or
performed by it.
3.3 Due Authorization. This Amendment has been duly authorized, validly executed and
delivered by one or more authorized officers of Xxxxxxx, XX Service and each of their respective
subsidiaries and each of this Amendment, the HB Service Credit Agreement and the Xxxxxxx Credit
Agreement, constitutes the legal, valid and binding obligation of HB Service and Xxxxxxx, to the
extent each is a party thereto, enforceable against it in accordance with its terms and each of the
other Credit Documents (as defined in each of the HB Service Credit Agreement and the Xxxxxxx
Credit Agreement) constitutes the legal, valid and binding obligation of Xxxxxxx, XX Service, and
each of their respective Subsidiaries, to the extent party thereto, enforceable against each such
party in accordance with its terms.
3.4 No Event of Default. No Default or Event of Default under the HB Service Credit
Agreement or the Xxxxxxx Credit Agreement has occurred or is continuing.
3.5 Continuing Security Interests. All obligations of Xxxxxxx, the Subsidiary
Guarantors, HB Service and its Subsidiaries and Xxxxxxx Hygiene under the Xxxxxxx Credit Agreement
and the other Credit Documents (as defined in the Xxxxxxx Credit Agreement) continue to be or will
be secured by the Bank’s security interests in all of the collateral granted under the Xxxxxxx
Credit Agreement and the Security Documents (as defined in the Xxxxxxx Credit Agreement), and
nothing herein will affect the validity, enforceability, perfection or priority of such security
interests.
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3.6 No Defenses. Neither Xxxxxxx nor HB Service has any right of setoff,
counterclaim, or defense to payment of its respective liabilities or obligations under the Xxxxxxx
Credit Agreement or HB Service Credit Agreement, respectively. The Bank hereby expressly reserves
all rights and remedies it may have against Xxxxxxx, XX Service and all other Persons (as defined
in both the Xxxxxxx Credit Agreement and the HB Service Credit Agreement) who may be or may
hereafter become secondarily liable for the repayment of the obligations thereunder.
ARTICLE IV
COVENANTS
4.1 Consummation of Certain Transactions. Within 45 days of the date hereof, Xxxxxxx
Hygiene, the ultimate parent company of Xxxxxxx and HB Service, shall have consummated the
following transactions:
(a) the private placement of the equity of Xxxxxxx Hygiene, with aggregate proceeds to Xxxxxxx
Hygiene in an amount not less than $55,000,000 (the “Private Placement”); and
(b) the acquisition (the “Choice Acquisition”), directly or indirectly through a
merger), of Choice Environmental Services, Inc. and its subsidiaries (“Choice”), pursuant
to the terms of the Merger Agreement, dated as of February 13, 2011, between Xxxxxxx Hygiene and
Choice (the “Choice Merger Agreement”).
4.2 Choice Merger Agreement. The Choice Merger Agreement shall not be amended without
the consent of the Bank, except for amendments that are not materially adverse to the interests of
the Bank.
4.3 Addition of Choice and its Subsidiaries as Subsidiary Guarantors. Within 45 days
of the consummation of the Choice Acquisition, Xxxxxxx shall cause the following to be duly
executed and delivered to the Bank:
(a) (i) a guaranty agreement, pursuant to which Choice and each of its Subsidiaries guarantees
the obligations of Xxxxxxx under the Xxxxxxx Credit Agreement, (ii) a guaranty agreement, pursuant
to which Choice and each of its Subsidiaries guarantees the obligations of HB Service under the HB
Service Credit Agreement, (iii) a pledge and security agreement, pursuant to which Choice and each
of its Subsidiaries has granted a security interest in favor of the Bank in all of its assets to
secure its obligations under the guaranty described in clause (i) above, (iv) a pledge and security
agreement, pursuant to which Choice and each of its Subsidiaries has granted a security interest in
favor of the Bank in all of its assets to secure its obligations under the guaranty described in
clause (ii) above, and (v) such other documents, certificates and instruments reasonably requested
by the Bank in connection therewith, in each case in form and substance reasonably acceptable to
the Bank; and
(b) resolutions of the board of directors (or other similar governing body) of Choice and each
of its Subsidiaries, in form and substance reasonably acceptable to the Bank, authorizing the
execution and delivery of the documents listed in clause (a) above.
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4.4 No Indebtedness or Liens. Notwithstanding anything herein or in the Xxxxxxx
Credit Agreement or HB Service Agreement to the contrary, until the satisfaction of the covenant
set forth in Section 4.3, following the consummation of the Choice Acquisition, neither Choice no
any of its Subsidiaries shall (a) directly or indirectly, issue, assume, create, incur or suffer to
exist any Indebtedness in excess of $2,500,000, representing certain acquisition debt and equipment
loans existing as of the date hereof, or (b) create, assume or suffer to exist, any Lien in or on
any of its property, real or personal, whether now owned or hereafter acquired, other than Liens
existing as of the date hereof securing the Indebtedness permitted under clause (a) hereof;
provided that any Liens of record in favor of Comerica Bank that secured the Indebtedness
of Choice to Comerica being terminated in connection with the Choice Acquisition may remain of
record for a period of 45 days (or 3 days with respect to Liens that may be terminated by filing of
a UCC-3 termination statements in the jurisdiction of incorporation or organization of the
applicable Person) following the consummation of the Choice Acquisition so long as such Liens do
not secure any Indebtedness and Choice has been granted the authority by Comerica to terminate such
Liens following the termination of such Indebtedness.
4.5 Guaranties and Security for HB Service Credit Agreement. Within 120 days of the
date hereof, HB Service shall cause the following to be duly executed and delivered to the Bank:
(a) (i) a guaranty agreement, pursuant to which Xxxxxxx Hygiene and each of its Subsidiaries
guarantees the obligations of HB Service under the HB Service Credit Agreement (to the extent not
already a guarantor thereof), (ii) a pledge and security agreement, pursuant to which Xxxxxxx
Hygiene and each of its Subsidiaries has granted a security interest in favor of the Bank in all of
its assets to secure its obligations under the guaranty described in clause (i) above, and (iii)
such other documents, certificates and instruments reasonably requested by the Bank in connection
therewith, in each case in form and substance reasonably acceptable to the Bank; and
(b) resolutions of the board of directors (or other similar governing body) of Xxxxxxx Hygiene
and each of its Subsidiaries, as applicable, in form and substance reasonably acceptable to the
Bank, authorizing the execution and delivery of the documents listed in clause (a) above.
4.6 Failure to Comply. The failure of HB Service or Xxxxxxx or any other Amendment
Party or affiliate thereof (including Xxxxxxx Hygiene) to comply with the covenants set forth in
this Article IV shall constitute an Event of Default under, and as defined in, each of the HB
Service Credit Agreement and the Xxxxxxx Credit Agreement.
ARTICLE V
CONDITIONS TO EFFECTIVENESS
This Amendment shall become effective as of the Effective Date upon the satisfaction of each
of the following conditions precedent:
(a) The Bank shall have received a duly executed counterpart of this Amendment from each of
Xxxxxxx, the Subsidiary Guarantors (as defined in the Xxxxxxx Credit Agreement),
HB Service and each of its subsidiaries and Xxxxxxx Hygiene (collectively, the “Amendment
Parties”);
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(b) The Bank shall have received duly executed counterparts of the Termination and Release of
Guaranty Agreements, related to each of the Xxxxxxxx Xxxxxxx Guaranty and the Xxxxxxxx XX Service
Guaranty, from each party thereto;
(c) Xxxxxxx shall have deposited $15,000,000 in a blocked deposit account at the Bank and the
Bank shall have received a duly executed counterpart of the Account Security Agreement from
Xxxxxxx;
(d) Xxxxxxx and HB Service shall have paid all reasonable out-of-pocket costs and expenses of
the Bank to be paid by them at the closing in connection with the preparation, negotiation,
execution and delivery of this Amendment (including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Bank with respect thereto); and
(e) The Bank shall have received such other documents, certificates, opinions, instruments and
other evidence as the Bank may reasonably request, all in a form and substance satisfactory to the
Bank and its counsel.
ARTICLE VI
ACKNOWLEDGEMENTS; REPRESENTATIONS; CONSENT
6.1 Amendment Parties. Each of the Amendment Parties hereby approves and consents to
the transactions contemplated by this Amendment and the Proposed Transaction, confirms and agrees
that, after giving effect to this Amendment, each of the Xxxxxxx Credit Agreement, the HB Service
Credit Agreement and the other Credit Documents (as defined in each of the Xxxxxxx Credit Agreement
and the HB Service Credit Agreement) to which it is a party, remains in full force and effect and
enforceable against it in accordance with its terms and shall not be discharged, diminished,
limited or otherwise affected in any respect, and represents and warrants to the Bank that it has
no knowledge of any claims, counterclaims, offsets, or defenses to or with respect to its
obligations under the Credit Documents (as defined in each of the Xxxxxxx Credit Agreement and the
HB Service Credit Agreement), or if it has any such claims, counterclaims, offsets, or defenses to
such Credit Documents or any transaction related to such Credit Documents, the same are hereby
waived, relinquished, and released in consideration of the execution of this Amendment.
Furthermore, each of Amendment Parties acknowledges and agrees that its obligations under the
Credit Documents (as defined in each of the Xxxxxxx Credit Agreement and the HB Service Credit
Agreement) shall not be discharged, limited or otherwise affected by reason of the Bank’s actions
with respect to any other Amendment Party, or with respect to, or in adding or releasing, any other
guarantor of the obligations of Xxxxxxx under the Xxxxxxx Credit Agreement or HB Service under the
HB Service Credit Agreement, in each case without the necessity of giving notice to or obtaining
the consent of such Amendment Party. The acknowledgements and confirmations by each of the
Amendment Parties herein is made and delivered to induce the Bank to enter into this Amendment and
continue to extend credit to Xxxxxxx, XX Service and the other Amendment Parties, and each of the
Amendment
Parties acknowledges that the Bank would not enter into this Amendment and continue to extend
such credit in the absence of the acknowledgement and confirmation contained herein.
12
6.2 Guarantors. Each of the Subsidiary Guarantors, HB Service and each of its
Subsidiaries and Xxxxxxx Hygiene (collectively, the “Guarantor Parties”) further represents
that it has knowledge of Xxxxxxx’x, XX Service’s and the other Amendment Parties’ financial
condition and affairs and that it has adequate means to obtain from Xxxxxxx, XX Service and the
other Amendment Parties on an ongoing basis information relating thereto and to Xxxxxxx’x, XX
Service’s and the other Amendment Parties’ ability to pay and perform their respective obligations
under the Credit Documents (as defined in each of the Xxxxxxx Credit Agreement and the HB Service
Credit Agreement), and agrees to assume the responsibility for keeping, and to keep, so informed
for so long as the guaranty of each such Guarantor Party remains in effect. Each Guarantor Party
agrees that the Bank shall have no obligation to investigate the financial condition or affairs of
Xxxxxxx, XX Service or any of the Amendment Parties for the benefit of any Guarantor Party nor to
advise any Guarantor Party of any fact respecting, or any change in, the financial condition or
affairs of Xxxxxxx, XX Service or any of the Amendment Parties that might become known to the Bank
at any time, whether or not the Bank knows or believes or has reason to know or believe that any
such fact or change is unknown to any Guarantor Party, or might (or does) materially increase the
risk of any Guarantor Party as guarantor, or might (or would) affect the willingness of any
Guarantor Party to continue as a guarantor of the obligations of Xxxxxxx or HB Service, as the case
may be, under the Credit Documents (as defined in each of the Xxxxxxx Credit Agreement and the HB
Service Credit Agreement). These representations and agreements by each of the Guarantor Parties
are made and delivered to induce the Bank to enter into this Amendment and continue to extend
credit to Xxxxxxx, XX Service and the other Amendment Parties under the Credit Documents (as
defined in each of the Xxxxxxx Credit Agreement and the HB Service Credit Agreement), and each of
the Guarantor Parties acknowledges that the Bank would not enter into this Amendment and continue
to extend such credit in the absence of the representations and agreements contained herein.
6.3 Consent to Xxxxxxxx Release. Each Guarantor Party acknowledges that concurrently
with the execution hereof, the Bank is terminating and releasing the Xxxxxxxx Xxxxxxx Guaranty and
the Xxxxxxxx XX Service Guaranty, subject to the terms and conditions included in the applicable
Termination and Release of Guaranty Agreement (such releases collectively, the “Xxxxxxxx
Release”). Each Guarantor Party further consents to the Xxxxxxxx Release and waives any
objections, defenses, offsets, or claims against the Bank due to or relating to the Xxxxxxxx
Release. This acknowledgment and consent are irrevocable and may be relied upon by the Bank.
ARTICLE VII
GENERAL
7.1 Full Force and Effect. This Amendment is limited as specified and, except as
specifically set forth herein, shall not constitute a modification, acceptance or waiver of any
other provision of any of the Credit Documents (as defined in each of the Xxxxxxx Credit Agreement
and the HB Service Credit Agreement). Each of the Xxxxxxx Credit Agreement and
13
the HB Service Credit Agreement, as amended by the amendments set forth herein, shall continue
to be in full force and effect in accordance with the provisions thereof after giving effect to
such amendments. Any reference to the Xxxxxxx Credit Agreement in any of the Security Documents or
other Credit Documents (each as defined in the Xxxxxxx Credit Agreement) shall mean the Xxxxxxx
Credit Agreement as amended by the Amendment and as may be further amended, modified, restated, or
supplemented from time to time. Any reference to the HB Service Credit Agreement in any of the
Credit Documents (as defined in the HB Service Credit Agreement) shall mean the HB Service Credit
Agreement as amended by the Amendment and as may be further amended, modified, restated, or
supplemented from time to time. This Amendment shall be a Credit Document under (and as defined
in) each of the Xxxxxxx Credit Agreement and the HB Service Credit Agreement.
7.2 Applicable Law. This Amendment shall be governed by and construed in accordance
with the internal laws and judicial decisions of the State of North Carolina.
7.3 Counterparts; Execution. This Amendment may be executed in two or more
counterparts, each of which shall constitute an original, but all of which when taken together
shall constitute but one instrument. The exchange of copies of this Amendment and of signature
pages by facsimile transmission shall constitute effective execution and delivery of this Amendment
and such copies may be used in lieu of the original Amendment for all purposes. Delivery of an
executed counterpart of a signature page of this Agreement by facsimile transmission shall be
effective as delivery of a manually executed counterpart of this Amendment.
7.4 Expenses. Each of Xxxxxxx and HB Service, jointly and severally, agrees to pay on
demand all reasonable out-of-pocket expenses incurred by the Bank in connection with the
preparation, execution and delivery of this Amendment, including, without limitation, all
reasonable attorneys’ fees.
7.5 Further Assurances. Each of the Amendment Parties shall execute and deliver to
the Bank such documents, certificates, and opinions as the Bank may reasonably request to effect
the amendments contemplated by this Amendment and, with respect to the Xxxxxxx Credit Agreement, to
continue the existence, perfection and first priority of the Bank’s security interests in the
collateral securing the obligations under the Credit Documents (as defined in the Xxxxxxx Credit
Agreement).
7.6 Headings. The headings of this Amendment are for the purposes of reference only
and shall not affect the construction of this Amendment.
[The remainder of this page is left blank intentionally.]
14
IN WITNESS WHEREOF, the parties hereto have caused this Omnibus Amendment Agreement, Limited
Consent and Waiver to be executed and delivered by their duly authorized officers all as of the
date first above written.
| XXXXXXX INTERNATIONAL, INC. |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Chief Financial Officer | |||
| HB SERVICE, LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Chief Financial Officer | |||
[Signature Pages Continued on the Following Page]
Signature Page to Omnibus Amendment Agreement (Extension)
| XXXXX FARGO BANK, NATIONAL ASSOCIATION |
||||
| By: | /s/ Cavan X. Xxxxxx | |||
| Cavan X. Xxxxxx | ||||
| Senior Vice President | ||||
[Signature Pages Continued on the Following Page]
Signature Page to Omnibus Amendment Agreement (Extension)
| GUARANTOR PARTIES: XXXXXXX HYGIENE, INC. |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Chief Financial Officer | |||
| XXXXXXX HYGIENE FRANCHISE CORP. XXXXXXX PEST CONTROL CORP. XXXXXXX MAIDS, INC. |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Chief Financial Officer | |||
| SHFC BUFFALO, LLC SHFC MINNEAPOLIS, LLC SHFC OKLAHOMA, LLC SHFC OPERATIONS, LLC SHFC ARIZONA, LLC SHFC TEXAS, LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Chief Financial Officer | |||
[Signature Pages Continued on the Following Page]
Signature Page to Omnibus Amendment Agreement (Extension)
| SERVICE BALTIMORE, LLC SERVICE XXXXXXX HILLS, LLC SERVICE BIRMINGHAM, LLC SERVICE CALIFORNIA, LLC SERVICE CAROLINA, LLC SERVICE CENTRAL FL, LLC SERVICE CHARLOTTE LLC SERVICE CHATTANOOGA, LLC SERVICE CINCINNATI, LLC SERVICE COLUMBIA, LLC SERVICE COLUMBUS, LLC SERVICE DC, LLC SERVICE DENVER, LLC SERVICE FCS, LLC SERVICE FLORIDA, LLC SERVICE FRESNO, LLC SERVICE GAINESVILLE, LLC SERVICE GOLD COAST, LLC SERVICE GREENSBORO, LLC SERVICE GREENVILLE, LLC SERVICE GULF COAST, LLC SERVICE HOUSTON, LLC SERVICE INDIANAPOLIS, LLC SERVICE LAS VEGAS, LLC SERVICE LOUISVILLE, LLC SERVICE MEMPHIS, LLC SERVICE MIDATLANTIC, LLC SERVICE MIDWEST, LLC SERVICE NASHVILLE, LLC SERVICE NEW ORLEANS, LLC SERVICE NEW YORK, LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Chief Financial Officer | |||
Signature Page to Omnibus Amendment Agreement (Extension)
| SERVICE NORTH, LLC SERVICE NORTH-CENTRAL, LLC SERVICE OKLAHOMA CITY, LLC SERVICE PHILADELPHIA, LLC SERVICE PHOENIX, LLC SERVICE RALEIGH, LLC SERVICE SALT LAKE CITY, LLC SERVICE SEATTLE, LLC SERVICE SOUTH, LLC SERVICE ST. LOUIS, LLC SERVICE TALLAHASSEE, LLC SERVICE TAMPA, LLC SERVICE TRI-CITIES, LLC SERVICE VIRGINIA, LLC SERVICE WEST COAST, LLC |
||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | Chief Financial Officer | |||
Signature Page to Omnibus Amendment Agreement (Extension)
