Exhibit 10.1
TENTH AMENDMENT TO REVOLVING CREDIT AGREEMENT
This Tenth Amendment to Revolving Credit Agreement ("Tenth Amendment")
is made as of November 13, 2001 by and among PROVANT, Inc. (the "Borrower"), a
Delaware business corporation having its principal place of business at 00
Xxxxxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxx, XX 00000, Fleet National Bank, a
national banking association ("Fleet"), Xxxxx Fargo Bank Iowa, N.A., a national
banking association ("Xxxxx Fargo"), Citizens Bank of Massachusetts, a
Massachusetts banking corporation ("Citizens"), and KeyBank National
Association, a national banking association ("KeyBank", together with Fleet,
Xxxxx Fargo and Citizens, the "Banks"), and Fleet National Bank, as agent for
itself and the other Banks (the "Agent")
RECITAL
WHEREAS, the Borrower, the Banks and the Agent previously entered into
that certain Revolving Credit Agreement, dated as of April 8, 1998, as
thereafter modified and amended by the First, Second, Third, Fourth, Fifth,
Sixth, Seventh, Eighth and Ninth Amendments thereto and a letter amendment dated
as of November 6, 2001 (said Revolving Credit Agreement, as so amended prior to
the date hereof, the "Credit Agreement"), pursuant to which the Banks have made
available to the Borrower a revolving credit loan facility for its corporate
purposes; and
WHEREAS, the parties hereto now desire to further amend or modify the
Credit Agreement in certain respects in order to (i) waive certain Events of
Default that have occurred, (ii) modify the interest rate structure applicable
to all loans thereunder, and (iii) undertake certain other modifications and
amendments, all as more particularly set forth hereinbelow.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
hereto agree as follows:
Section 1. Definitions. All capitalized terms used herein without
definition shall have the respective meanings provided therefor in the Credit
Agreement.
Section 2. Amendments to Credit Agreement.
(i) The definition of "Applicable Margin" in Section 1.1 is hereby
amended and restated in its entirety so as to read as follows:
"Applicable Margin". The Applicable Margin shall be 2.50% for all Prime
Rate Loans and 4.50% for all Eurodollar Rate loans.
(ii) Section 4.9 is amended in its entirety to provide as follows:
"4.9 Interest After Default. Upon and after the occurrence of
an Event of Default, and during the continuation thereof, the principal amount
of the Obligations shall bear interest, calculated daily (computed on the actual
days elapsed over a year of 360 days), at a
fluctuating rate per annum equal to two percent (2%) above the interest rate
otherwise applicable thereto."
(iii) Notwithstanding any other provision of the Credit Agreement, from
and after the date hereof the Borrower shall have no further right to request,
or to convert to or to continue, any Revolving Credit Loan in the form of a
Eurodollar Rate Loan. All Eurodollar Rate Loans which are outstanding on the
date of this Tenth Amendment may remain outstanding for the duration of the
Interest Period previously selected by the Borrower for each such Eurodollar
Rate Loan, but no presently outstanding Eurodollar Rate Loan shall be entitled
to be renewed.
(iv) Borrower agrees that it shall enter into an amendment with Agent
and Banks on terms and conditions reasonably satisfactory to Agent and Banks in
their sole discretion, which amendment shall contain (to the extent not
otherwise contained in this Tenth Amendment) each of the terms and conditions
set forth in the Reservation of Rights Letter from Agent to Borrower dated
November __, 2001 attached hereto as Exhibit II. Borrower agrees that failure to
enter into such amendment on or prior to November 30, 2001 shall constitute an
Event of Default under the Credit Agreement.
Section 3. Waiver. Subject to satisfaction of the conditions precedent
set forth in Section 4 below, Agent and Lenders hereby waive the Events of
Default set forth on Exhibit I attached hereto; provided, however, in the event
an Event of Default occurs as a result of Borrower's failure to comply with
Section 2(iv) of this Tenth Amendment, then such waiver shall be deemed null and
void ab initio and Agent and Borrowers shall have all rights and remedies under
the Credit Agreement with respect to such Events of Default as if such waiver
had never been granted.
Section 4. Conditions of Effectiveness. This Tenth Amendment shall
become effective upon satisfactory of the following conditions precedent: Agent
shall have received (i) six (6) copies of this Amendment executed by Borrower
and Lenders and consented and agreed to by Guarantors pursuant to the form of
amendment set forth as Annex A attached hereto and (ii) payment by Borrower of
the $500,000 fee due and owing on October 31, 2001 pursuant to Section 11 of the
Ninth Amendment.
Section 5. Effective Date. The effective date of this Tenth Amendment
shall for all purposes be the date appearing on the first page hereof.
Section 6. Loan Documents Ratified and Confirmed. The Credit Agreement
and each of the other Loan Documents, as they may be specifically supplemented
or amended by this Tenth Amendment, are and shall continue to be in full force
and effect and are hereby in all respects ratified and confirmed. Without
limiting the generality of the foregoing, the Security Documents and all of the
collateral described therein, do, and shall continue to, secure the payment of
all obligations under the Loan Documents, in each case as amended or
supplemented pursuant to this Tenth Amendment. All references to the "Credit
Agreement" contained in the Loan Documents shall mean or refer to the Credit
Agreement as amended and supplemented by this Tenth Amendment and as it may be
further amended, supplemented, modified and restated and in effect from time to
time, including without limitation any such amendment, supplement,
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modification or restatement which increases the amount of Indebtedness owing by
the Borrower thereunder.
Section 7. Bringdown. The Borrower hereby confirms that all
representations and warranties with respect to the Borrower and any Subsidiaries
contained in the Credit Agreement and each of the other Loan Documents and in
any other certificate or document delivered in connection therewith are true and
correct as of the date hereof, and that no Default or Event of Default is
outstanding or would be created by the consummation of the transactions
described herein.
Section 8. Fees, Costs and Expenses. In addition to the foregoing
transaction fee, Borrower agrees to pay on demand all the costs and expenses of
the Agent and the Banks, including without limitation all reasonable fees and
expenses of counsel, in connection with the preparation, execution and delivery
of this Tenth Amendment and the other documents and instruments to be delivered
herewith.
Section 9. Miscellaneous. This Tenth Amendment may be executed in
several counterparts and by each party on a separate counterpart, each of which
when executed and delivered shall be an original, and all of which together
shall constitute one instrument. In proving this Tenth Amendment, it shall not
be necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought. This Tenth Amendment is intended
to take effect as a sealed instrument and shall for all purposes be construed in
accordance with and governed by the laws of The Commonwealth of Massachusetts
(excluding the laws applicable to conflicts or choice of law).
Section 10. Facsimile. Any signature delivered by a party by facsimile
transmission shall be deemed to be an original signature hereto.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Tenth Amendment
to be duly executed as an instrument under seal as of the date first above
written.
PROVANT, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Executive Vice President
CITIZENS BANK OF MASSACHUSETTS
By: /s/ Xxxxxx X. Xxxx
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Title: Vice President
FLEET NATIONAL BANK
By: /s/ Xxxxx. X. Xxxxxx
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Title: Vice President
KEYBANK NATIONAL ASSOCIATION
By: /s/ Xxxxx Xxxxxx
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Title: Vice President
XXXXX FARGO BANK IOWA, N.A.
By: /s/ Xxxxx X. Xxxxxxxx
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Title: Vice President
FLEET NATIONAL BANK, as AGENT
By: /s/ Xxxxx. X. Xxxxxx
---------------------------
Title: Vice President
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EXHIBIT I
Events of Default
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The Borrower was not in compliance with the following provisions of the
Credit Agreement:
1. Section 9.3, concerning the Leverage Ratio as of September 30, 2001
for the quarter then ended.
2. Section 9.4, concerning Consolidated EBITDA for the quarter ended
September 30, 2001.
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EXHIBIT II
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Reservation of Rights Letter
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[See Attached]
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[FleetBoston Financial Letterhead]
November 13, 2001
Via Facsimile and
-----------------
Certified Mail, Return Receipt Requested
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Provant, Inc.
00 Xxxxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxxx Xxxxxxxx, Executive Vice President
Dear Xx. Xxxxxxxx:
Reference is hereby made to the Revolving Credit Agreement dated as of
April 8, 1998 (as amended, the "Credit Agreement"), by and among Provant, Inc.
("Borrower"), Fleet National Bank, as Agent ("Agent") and the other lending
institutions a party thereto (collectively, the "Banks"). Capitalized terms not
otherwise defined herein shall have the meanings given to them in the Credit
Agreement.
At the present time, certain Events of Default have occurred and are
continuing under the Credit Agreement including, without limitation, Borrower's
failure to comply with various financial covenants set forth in Section 9 of the
Credit Agreement.
Although Agent and Banks are not presently taking any immediate action
with respect to the aforementioned Events of Default, Agent on behalf of itself
and Banks hereby reserves all of their rights and remedies under the Credit
Agreement and applicable law, and Agent's and Bank's election not to exercise
any such rights or remedies at the present time shall not (a) limit in any
manner whatsoever Borrower's obligation to comply with, and Agent's and Banks'
right to insist on Borrower's compliance with, each and every term of the Credit
Agreement and (b) constitute a waiver of any Event of Default or any right or
remedy available to Agent and Banks under the Credit Agreement or applicable
law, and Agent hereby expressly reserves such rights with respect to the same.
In addition, you have requested that Agent and Banks forbear from
exercising their rights with respect to such Events of Default and continue to
make Revolving Credit Loans to Borrower under the Credit Agreement. Agent and
Banks are willing to consider such a forbearance on such terms and conditions as
are satisfactory to Agent and Banks in their sole discretion, including, without
limitation:
1. The term of the credit facility shall end upon the earlier of (a)
July 31, 2002, (b) the occurrence of additional defaults under the Credit
Agreement and (c) the failure to meet various milestones set in connection with
the refinancing in full of the credit facility.
2. Interest on Revolving Credit Advances shall be increased to prime
plus 2.50%. No new LIBOR Loans shall be permitted. Upon a default, the interest
rate shall increase by an additional 2.00%.
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3. The maximum credit facility shall be the lesser of (a) $50,000,000
and (b) Eligible Accounts Receivable plus $15,000,000.
4. Payment of the $500,000 fee required to be paid pursuant to Section
11(a)(ii) of Amendment No. 9, which fee has been due and owing since October 31,
2001.
5. Payment of a facility fee of $300,000 on December 28, 2001 if any
Bank's Commitment remains outstanding or if the credit facility has not been
repaid in full.
6. Payment of all legal and consultant fees of Agent.
7. Establishment of various milestones in connection with the Xxxxxxxx
offering memorandum and the refinancing in full of the credit facility,
including without limitations the following milestones:
o Completion of final solicitation booklet
o Presentation to Rating Agency
o Insurance of rating by Ratings Agency
o Delivery of books to targets
o Receipts of expressions of interest
o Closing date.
The failure to meet any milestone shall be a default under the Credit
Facility.
8. Waiver of default under certain financial covenants for the period
ending September 30, 2001 and re-setting and establishment of various financial
covenants.
9. Establishment of reporting requirements acceptable to Agent and
Banks, weekly cash flow actual/projection (including revolver usage and asset
borrowing base levels), weekly Borrowing Base Certificates, monthly income,
balance sheet and cash flow statements, quarterly compliance certificates plus
that information due us under existing loan documents.
10. Receipt by Agent and Borrowers no later than December 15, 2001 of
an alternative plan for the refinancing in full of the credit facility in the
event the Xxxxxxxx transaction does not take place.
11. Such other terms and conditions as may be required by Agent and
Banks.
The foregoing is being furnished only for the purpose of discussion and
does not constitute a proposal, a commitment or an offer to enter into or amend
the Credit Agreement.
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Very truly yours,
FLEET NATIONAL BANK, as Agent and Lender
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
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ANNEX A
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AMENDMENT AND CONFIRMATION OF GUARANTY
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AND SECURITY AGREEMENT
----------------------
This AMENDMENT AND CONFIRMATION OF GUARANTY (the "Guaranty Amendment"),
dated as of November 13, 2001, is entered into by each of the parties identified
as a Guarantor on the signature page hereto, all of which are "Guarantors" under
that certain Guaranty, dated as of May 29, 1998, as supplemented by various
Instruments of Adherence thereto and prior Amendment and Confirmation of
Guaranty instruments, including without limitation those dated as of December
31, 1998, March 31, 1999, June 25, 1999, June 29, 1999, September 30, 1999,
December 10, 1999, June 30, 2000 and June 29, 2001(as so described, the
"Guaranty"), made by such of the Guarantors as are named in such instruments,
each in favor of FLEET NATIONAL BANK, as agent (the "Agent") for itself and
other lending institutions under the Credit Agreement (as hereinbelow defined).
All capitalized terms used herein without definition shall have the respective
meanings set forth in the Credit Agreement (as hereinbelow defined).
WHEREAS, the Agent is a party to that certain Revolving Credit
Agreement, dated as of April 8, 1998 (as amended and in effect through the date
hereof and from time to time hereafter, the "Credit Agreement") among PROVANT,
Inc. (the "Borrower"), the Agent and other lending institutions (collectively,
the "Banks") named therein; and
WHEREAS, the Borrower and the Guarantors are members of a group of
related corporations, and each of the Guarantors has previously entered into the
Guaranty for the purpose of assuring payment of all Obligations of the Borrower
and a Security Agreement granting security for the obligations under the
Guaranty; and
WHEREAS, the Banks, the Agent and the Borrower are this day entering
into a Tenth Amendment to Revolving Credit Agreement (the "Tenth Amendment"),
which provides for certain amendments and modifications with respect to the
provisions of the Credit Agreement; and it is a condition precedent to the
Banks' willingness to enter into the Tenth Amendment and to continue to make
Revolving Credit Loans or extend credit under the Credit Agreement, as so
amended by the Tenth Amendment, that each of the Guarantors execute and deliver
this Guaranty Amendment.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
hereto agree as follows:
1. All references to the "Credit Agreement" appearing in the Guaranty
and the Security Agreement (including references to capitalized terms which are
defined in the Credit Agreement) shall mean and refer to the Credit Agreement as
it is amended and supplemented by the Tenth Amendment and as it may be further
amended, supplemented, modified or restated and in effect from time to time
hereafter, and including without limitation any such amendment, supplement,
modification or restatement which increases the amount of Indebtedness owing by
the Borrower thereunder.
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2. The Guarantors hereby ratify and confirm the Guaranty and the
Security Agreement, as supplemented or modified by this Guaranty Amendment, as
remaining in full force and effect.
3. This Guaranty Amendment shall be governed by and construed in
accordance with the laws of The Commonwealth of Massachusetts (excluding the
laws applicable to conflicts or choice of law).
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, each of the Guarantors has caused this Guaranty
Amendment to be executed and delivered as an instrument under seal as of the
date first above written.
GUARANTORS:
BT. NOVATIONS, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
XXXXXX COMMUNICATIONS, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
X. XXXXXX & INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
NOVATIONS GROUP, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
PROVANT MEDIA, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
STRATEGIC INTERACTIVE, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
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PROVANT VERTICAL MARKET SOLUTIONS, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
STAR MOUNTAIN, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
PROVANT UTAH, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
STAR MEDIA, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Assistant Treasurer
STAR DIGITAL, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Assistant Treasurer
PROVANT SERVICES, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
XXXX-XXXXXXX LEADERSHIP CONSULTING GROUP, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
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PROVANT PROJECT MANAGEMENT, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Title: Assistant Treasurer
XXXXXX RESEARCH CORPORATION
By: /s/ Xxxxxx Xxxxxxxx
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Title: Vice President
FPMI COMMUNICATIONS, INC.
By: /s/ Xxxxxx Xxxxxxxx
-----------------------------------
Title: Assistant Treasurer
Accepted:
FLEET NATIONAL BANK, as Agent
By: /s/ Xxxxx. X. Xxxxxx
--------------------------------
Title: Vice President
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