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FIRST AMENDMENT
TO
AMENDED AND RESTATED
CREDIT AGREEMENT
This Amendment (this "Amendment") is entered into as of October 15,
1999 by and between Tri-State Outdoor Media Group, Inc., a Kansas corporation
(the "Borrower"), and Bank One, NA (f/k/a The First National Bank of Chicago)
("Bank One"), individually and as agent (in such capacity, the "Agent").
RECITALS
A. The Borrower, Bank One as the sole Lender (the "Lender") and the
Agent are parties to that certain Amended and Restated Credit Agreement dated as
of August 12, 1999 (the "Credit Agreement"). Unless otherwise specified herein,
capitalized terms used in this Amendment shall have the meanings ascribed to
them in the Credit Agreement.
B. SGH Holdings, Inc. ("Holdings"), a Delaware corporation and owner of
all of the outstanding shares of capital stock of the Borrower, intends to issue
a Senior Increasing Rate Note in the principal amount of $19,000,000 (the "Bear
Xxxxxxx Note") to Bear Xxxxxxx Investment Products Inc. and to contribute the
net proceeds thereof as equity to the Borrower.
C. The Borrower intends to apply the proceeds of such equity
contribution to finance (i) the acquisition of certain assets of PNE Media
Holdings, LLC, PNE Media, LLC and other Persons and related fees and expenses,
and (ii) other Capital Expenditures.
D. The Borrower, the Lender and the Agent wish to amend the Credit
Agreement to permit the above-described acquisitions and to make certain other
revisions thereto on the terms and conditions set forth below.
Now, therefore, in consideration of the mutual execution hereof and
other good and valuable consideration, the parties hereto agree as follows:
1. Article I of the Credit Agreement is hereby amended by
inserting the following definitions of the terms "Bear Xxxxxxx Equity
Contribution", "Bear Xxxxxxx Note" and "Bear Xxxxxxx Note and Warrants Purchase
Agreement" after the definition of the term "Authorized Officer" and before the
definition of the term "Borrower":
"'Bear Xxxxxxx Equity Contribution' means the equity
contribution in the amount of approximately $18,051,000 made by Holdings to the
Borrower with the net proceeds of the Bear Xxxxxxx Note.
'Bear Xxxxxxx Note' means that certain Senior Increasing Rate
Note, dated October 15, 1999, in the principal amount of $19,000,000 issued by
Holdings to Bear Xxxxxxx Investment Products Inc. due May 15, 2008.
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'Bear Xxxxxxx Note and Warrants Purchase Agreement' means that
certain Note and Warrants Purchase Agreement dated as of October 15, 1999
between Holdings and Bear Xxxxxxx Investment Products Inc."
2. Article I of the Credit Agreement is hereby amended by
restating in its entirety clause (iv) of the definition of the term "Change in
Control" to read as follows:
"(iv) a 'Change of Control', as defined in the Senior Note
Indenture or the Bear Xxxxxxx Note and Warrants Purchase Agreement, shall
occur."
3. Article I of the Credit Agreement is hereby amended by
restating in its entirety the definition of the term "Permitted Acquisition"
therein to read as follows:
"'Permitted Acquisition' means any Acquisition by the Borrower
with respect to which each of the following requirements is satisfied:
(a) The assets to be acquired are useful in, or the Person
whose equity interests are to be acquired is engaged in, the business of leasing
outdoor advertising space.
(b) Such Acquisition has been approved or consented to by (i)
the board of directors or equivalent governing body of the Person whose assets
or equity interests are to be acquired and (ii) unless such Acquisition
constitutes a Qualified Acquisition or the aggregate consideration for such
Acquisition (or for such Acquisition and related Acquisitions) is less than
$250,000, the Required Lenders.
(c) After giving effect to such Acquisition, no Default or
Unmatured Default will exist.
(d) The Borrower has delivered to the Agent with sufficient
copies for the Lenders:
(i) Copies, certified by the Secretary or Assistant
Secretary of the Borrower, of the agreements, instruments and documents
governing such Acquisition, which, in the case of each Acquisition that
is not a Qualified Acquisition, shall be in form and substance
satisfactory to the Agent.
(ii) Evidence satisfactory to the Agent that the
respective directors and shareholders (if necessary) of the Borrower
and the seller or sellers (with respect to such Acquisition) shall have
approved such Acquisition, that all regulatory and legal approvals for
such Acquisition have been obtained, and that all conditions to the
consummation of such Acquisition have been satisfied.
(iii) In the case of a Qualified Acquisition, if so
requested by the Agent, a certificate signed by the Borrower's Chief
Financial Officer stating that such Acquisition has been financed with
proceeds of the Bear Xxxxxxx Equity Contribution and listing all other
Qualified Acquisitions and Capital Expenditures so financed, with an
itemization of the amounts expended.
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(iv) A certificate signed by the Borrower's Chief
Financial Officer stating that on the date of such Acquisition and
after giving effect thereto, (i) no Default or Unmatured Default will
exist, (ii) the representations and warranties contained in Article V
of the Credit Agreement are true and correct, except to the extent that
any such representation or warranty is stated to relate solely to an
earlier date, and (iii) the representations and warranties contained in
Article III of the Security Agreement are true and correct, after
giving effect to any revised Exhibits thereto which are attached to
such certificate.
(v) UCC financing statements and any other documents,
agreements or instruments that the Agent deems necessary to maintain
the priority and perfection of the Agent's security interest in the
Collateral after giving effect to the consummation of such Acquisition.
(vi) Such other documents related to such Acquisition
as any Lender or its counsel may have reasonably requested."
4. Article I of the Credit Agreement is hereby amended by
inserting the following definition of the term "Qualified Acquisition" after the
definition of the term "Purchasers" and before the definition of the term "Rate
Hedging Agreement":
"'Qualified Acquisition' means an Acquisition by the Borrower
of certain assets of PNE Media Holdings, LLC, PNE Media, LLC or any other Person
financed with the proceeds of the Bear Xxxxxxx Equity Contribution for an
aggregate consideration (including related fees and expenses) for all such
Acquisitions not to exceed the amount of the Bear Xxxxxxx Equity Contribution,
less the aggregate amount of Capital Expenditures financed with the proceeds of
the Bear Xxxxxxx Equity Contribution."
5. Section 4.2 of the Credit Agreement is hereby amended by
restating it in its entirety to read as follows:
"4.2 Certain Advances. Prior to January 1, 2001, the Lenders
shall not be required to make any Advance under Facility B that would cause the
Facility B Principal Obligations Amount to exceed $8,000,000 (other than an
Advance that, after giving effect thereto and to the application of the proceeds
thereof, does not increase the aggregate amount of outstanding Advances under
such Facility) unless, in addition to satisfying the conditions set forth in
Section 4.3, the Borrower shall furnish to the Agent, at the time of the
Borrower's request for such Advance, a certificate of an Authorized Officer
stating that (i) the proceeds of such Advance shall be applied by the Borrower
to the payment of interest on Indebtedness, and (ii) cash and cash equivalents
on hand of the Borrower (excluding (A) prior to April 30, 2000, the amount of
the Bear Xxxxxxx Equity Contribution not theretofore expended for Permitted
Acquisitions and related fees and expenses and Capital Expenditures, and (B) on
and after April 30, 2000, any amounts held back by the Borrower during the
applicable hold-back period from the purchase price for Permitted Acquisitions
referred to in clause (A) above) will not exceed $250,000, after giving effect
to the application of such Advance to such payment of interest."
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6. Section 6.1(iv) and 6.1(v) of the Credit Agreement are
hereby restated in their entirety to read as follows:
"(iv) (a) Together with the financial statements required
under Sections 6.1(i) and (iii), commencing with the financial statements of the
Borrower for the fiscal year ending December 31, 1999, a Compliance Certificate
showing the calculations necessary to determine compliance with this Agreement,
and (b) together with the financial statements of the Borrower for the fiscal
period ending September 30, 1999, a Compliance Certificate showing the
calculations necessary to determine compliance with Sections 6.19.4 and 6.19.5.
(v) (a) Within 35 days after the end of each month, other than
any month on the last day of which a fiscal quarter ends, commencing with the
month ending July 31, 1999 for the Borrower and its Subsidiaries, a consolidated
profit and loss statement and statement of cash flows for the period from the
beginning of the then-current fiscal year to the end of such month, each
certified by the Chief Financial Officer of the Borrower, and (b) within 15 days
after the end of each month, commencing with the month ending July 31, 1999 (x)
a statement of the Total Revenues of the Borrower and its Subsidiaries for such
month and for the period from the beginning of the then-current fiscal year to
the end of such month, in each case broken down by division and certified by the
Chief Financial Officer of the Borrower, and (y) a breakdown of the amount of
the Bear Xxxxxxx Equity Contribution expended for Qualified Acquisitions (and
related fees and expenses) and Capital Expenditures, certified by the Chief
Financial Officer of the Borrower."
7. Section 6.19.4 of the Credit Agreement is hereby restated
in its entirety to read as follows:
"6.19.4 Total Revenues. The Borrower will maintain Total
Revenues of the Borrower and the Subsidiaries for each three-month period ending
on the last day of each month in the calendar year 1999 set forth below equal to
or greater than 93% of the amount set forth opposite such month.
Quarterly
Total Revenues
June $6,750,000
September $6,878,000
December $7,059,000"
8. Section 6.19.5 of the Credit Agreement is hereby restated
in its entirety to read as follows:
"6.19.5 Net Operating Cash Flow. The Borrower will maintain
Net Operating Cash Flow for each three-month period ending on the last day of
each month in the calendar year 1999 set forth below equal to or greater than
95% of the amount set forth opposite such month.
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Quarterly
Net Operating Cash Flow
June $3,276,000
September $3,290,000
December $3,587,000"
9. Section 6.19.6 of the Credit Agreement is hereby amended by
restating in its entirety the last sentence thereof to read as follows:
"For purposes of determining compliance with the covenant set
forth in this Section 6.19.6, there shall be excluded from the calculation of
the amount of Capital Expenditures: (a) proceeds of Sale and Leaseback
Transactions permitted by Section 6.15(ii) to the extent that such proceeds are
expended for Capital Expenditures, and (b) proceeds of the Bear Xxxxxxx Equity
Contribution expended for Capital Expenditures prior to April 30, 2000."
10. Section 7.18 of the Credit Agreement is hereby restated in
its entirety to read as follows:
"7.18 Holdings shall: (a) transact any business other than (i)
the ownership of the stock of the Borrower, (ii) the servicing of the Converted
Mesirow Equity (including the payment of permitted dividends thereon) or any
Indebtedness into which the Converted Mesirow Equity may be converted pursuant
to the terms thereof, and (iii) the issuance of the Bear Xxxxxxx Note and the
warrants and capital stock contemplated by the Bear Xxxxxxx Note and Warrants
Purchase Agreement, (b) have incurred any Indebtedness other than (i) any
Indebtedness into which the converted Mesirow Equity may be converted pursuant
to the terms thereof, or (ii) the Bear Xxxxxxx Note, (c) have amended or
modified the Mesirow 94 Documents or the Mesirow 97 Documents, other than to
permit the execution, delivery and performance by Holdings and the Borrower of
the Transaction Documents to which each is a party and by Holdings of the Bear
Xxxxxxx Note and Warrants Purchase Agreement, or (d) have voluntarily prepaid,
defeased or in substance defeased, purchased, redeemed, retired or otherwise
acquired, any Converted Mesirow Equity, any Indebtedness into which the
converted Mesirow Equity may be converted pursuant to the terms thereof, all or
any portion of the Bear Xxxxxxx Note or any warrant or capital stock issued
pursuant to the Bear Xxxxxxx Note and Warrants Purchase Agreement."
11. Schedule I to the form of Compliance Certificate attached
as Exhibit C to the Credit Agreement is hereby amended by deleting Sections
6.19.4 (Monthly Total Revenues) and 6.19.5 (Monthly Net Operating Cash Flow) and
restating in their entirety Sections 6.19.4 (Rolling three-month Total
Revenues), 6.19.5 (Rolling three-month Net Operating Cash Flow) and 6.19.6
(Capital Expenditures) to read as follows:
"6.19.4. Quarterly Total Revenues
a. Total Revenues for three-month period
ended ______, 1999
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b. Amount set forth in the "Quarterly Total Revenues"
column opposite the month referred to in a. in the
table in Section 6.19.4
c. 93% of b.
Covenant: a. may not be less than c.
Compliance ("Yes" or "No")
6.19.5. Quarterly Net Operating Cash Flow
a. Net Operating Cash Flow for three-month period
ended ______, 1999
b. Amount set forth in the "Quarterly Net Operating
Cash Flow" column opposite the month referred to in
a. in the table in Section 6.19.5
c. 95% of b.
Covenant: a. may not be less than c.
Compliance ("Yes" or "No")
6.19.6. Capital Expenditures
a. Capital Expenditures (7)
b. Proceeds of permitted Sale and Leaseback Transactions
expended on Capital Expenditures
c. Proceeds of Bear Xxxxxxx Equity Contribution expended
on Capital Expenditures prior to April 30, 2000
d. Sum of b. plus c.
e. a. minus d.
MAXIMUM PERMITTED:
Period/Year Amount
Effective Date to 12/31/99
$1,800,000
2000 $2,500,000
2001 $2,700,000
2002 $2,800,000
2003 $2,900,000
2004 $3,100,000
2005 $3,200,000
Covenant: e. may not exceed applicable amount set forth above
plus unexpended amount from prior year if no Default or
Unmatured
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Default exists.
Compliance ("Yes" or "No") "
12. The Borrower represents and warrants to the Lender and the
Agent that:
(a) The execution, delivery and performance by the
Borrower of this Amendment have been duly authorized by all necessary
corporate action and do not and will not contravene or conflict with
any provision of law applicable to the Borrower, its articles of
incorporation or by-laws, or any order, judgment or decree of any court
or other agency of government or any contractual obligation binding
upon the Borrower; and the Credit Agreement, as amended by this
Amendment, is a legal, valid and binding obligation of the Borrower,
enforceable against the Borrower in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally.
(b) The representations and warranties of the
Borrower contained in Article V of the Credit Agreement, as amended by
this Amendment, are true and correct on and as the date hereof except
to the extent any such representation or warranty is stated to relate
solely to an earlier date, in which case such representation or
warranty was true on and as of such earlier date.
(c) Before and after giving effect to this Amendment,
there exists no Default or Unmatured Default.
13. This Amendment shall become effective as of the date
hereof upon the execution and delivery hereof by the Borrower, the Lender and
the Agent, and the Agent's receipt of the following:
(a) A counterpart of this Amendment executed by the
Borrower;
(b) Copies, certified by the Secretary or Assistant
Secretary of Holdings, of (i) the agreements, instruments and documents
governing the issuance of the Bear Xxxxxxx Note, and (ii) the Amendment
Agreement among Holdings, Mesirow Capital Partners VI and Mesirow
Capital Partners VII amending certain provisions of the Mesirow 94
Documents, the Mesirow 97 Documents and the Exchange Agreement dated
February 27, 1998 among Holdings, Mesirow Capital Partners VI and
Mesirow Capital Partners VII, which shall in each case be in form and
substance satisfactory to the Agent; and
(c) Evidence satisfactory to the Agent that the Bear
Xxxxxxx Note has been issued in accordance with the agreements,
instruments and documents referred to in clause (b) above and the net
proceeds thereof contributed as equity by Holdings to the Borrower.
14. The Borrower, the Lender and the Agent hereby acknowledge
and agree that, upon the issuance of the Bear Xxxxxxx Note and the contribution
of the net proceeds thereof
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as equity by Holdings to the Borrower, the Equity Infusion Date will have
occurred and the Borrower shall not be required to apply such net proceeds to a
prepayment under the Facilities pursuant to Section 2.2.4 of the Credit
Agreement.
15. Except as specifically amended by this Amendment, the
Credit Agreement and the other Loan Documents shall remain in full force and
effect and are hereby ratified and confirmed. The execution, delivery and
effectiveness of this Amendment shall not operate as a waiver of any right,
power or remedy of the Agent or any Lender under the Credit Agreement or any
Loan Document, nor constitute a waiver of any provision of the Credit Agreement
or any Loan Document, except as specifically set forth herein. Upon the
effectiveness of this Amendment, each reference in the Credit Agreement to "this
Agreement", "hereunder", "hereof", "herein" or words of similar import shall
mean and be a reference to the Credit Agreement as amended hereby.
16. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF ILLINOIS, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
17. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed an original, but all such counterparts
shall constitute one and the same instrument.
[signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Amendment
as of the date and year first above written.
TRI-STATE OUTDOOR MEDIA GROUP, INC.
By:
Xxxxxxx X. XxXxxxxx
Chief Financial Officer
BANK ONE, NA (F/K/A THE FIRST NATIONAL BANK OF
CHICAGO), INDIVIDUALLY AND AS AGENT
By:
Xxxxxx X. Xxxxxx
Authorized Agent
