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Exhibit 4.20
WAIVER AND AMENDMENT AGREEMENT
WAIVER AND AMENDMENT AGREEMENT (this "Agreement"), dated as of
October 31, 1996, by and among THE CERPLEX GROUP, INC., a Delaware corporation
(together with its successors and assigns, the "Company"), THE NORTHWESTERN
MUTUAL LIFE INSURANCE COMPANY, XXXX XXXXXXX MUTUAL LIFE INSURANCE COMPANY and
NORTH ATLANTIC SMALLER COMPANIES INVESTMENT TRUST PLC (collectively, the
"Noteholders").
RECITALS:
A. The Company has entered into those certain separate
Note Purchase Agreements, each dated as of November 19, 1993 (collectively, as
amended pursuant to the terms of each of the amendment agreements set forth in
Schedule A to this Agreement, the "Note Purchase Agreement"), with each of the
Noteholders, pursuant to which the Company originally issued and sold to the
Noteholders
(i) an aggregate principal amount of Seventeen
Million Two Hundred Fifty Thousand Dollars ($17,250,000) of the
Company's Series A 9.00% Senior Subordinated Notes Due November 19,
2001 (as amended, the "Notes"), and
(ii) an aggregate principal amount of Five Million
Seven Hundred Fifty Thousand Dollars ($5,750,000) of the Company's
Series B 9.00% Senior Subordinated Notes Due November 19, 2001 (the
"Series B Notes"). The Company has prepaid the Series B Notes and
such Series B Notes are no longer issued and outstanding.
B. The Noteholders are the current holders of one
hundred percent (100%) of the Notes outstanding as of the Effective Date.
C. The Company and the Noteholders have entered into
that certain Warrant Agreement (the "Existing 1996 Warrant Agreement," and as
amended hereby, the "Amended 0000 Xxxxxxx Agreement"), dated as of April 15,
1996, pursuant to which the Company issued one million warrants of the Company
to the Noteholders.
D. Pursuant to a notice to the Noteholders dated
September 23, 1996, the Company notified the Noteholders of certain Defaults
and Events of Defaults under Section 6.3 and Section 6.4 of the Note Purchase
Agreement (the "Noticed Events of Default," such term to include, for purposes
of avoidance of doubt, all Defaults and Events of Defaults under Section 6.3
and Section 6.4 of the Note Purchase Agreement that may have existed prior to
the date of such notice or after the date of such notice and prior to the
Effective Date (as hereinafter defined) and the Company has requested that the
Noteholders waive the Noticed Events of Default.
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E. In consideration of the aforesaid waivers, the
Company has agreed that the Existing 1996 Warrant Agreement shall be amended by
changing the definition of "Initial Purchase Price" therein from $6.00 to
$2.50.
F. The Noteholders are agreeable, subject to the terms
and conditions set forth below, to granting the aforesaid waivers, and in
connection therewith, each of the Company and the Noteholders has agreed to
amend the Existing 1996 Warrant Agreement as set forth herein.
G. Unless otherwise expressly provided for herein,
capitalized terms used herein and defined in the Note Purchase Agreement are
used herein with the meanings ascribed to them in the Note Purchase Agreement.
AGREEMENT:
NOW THEREFORE, for valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
SECTION 1. WAIVER.
Subject to the satisfaction of the conditions set forth in
Section 4, the Noteholders hereby waive, on the Effective Date, each of the
Noticed Events of Default and agree that the effectiveness of Section 6.3 and
Section 6.4 shall be temporarily suspended from and including the Effective
Date to and including the earlier to occur of (a) the date that any holder of
Senior Debt takes any action in respect of any default or any event of default
under any Senior Credit Document and (b) November 30, 1996 (the "Reinstatement
Date"). After the Reinstatement Date, Section 6.3 and Section 6.4 shall be in
full force and effect. Except for the foregoing express waivers and
suspensions, the terms of this Agreement shall not operate as a waiver of, or
otherwise prejudice, the rights, remedies or powers of the Noteholders under
the Note Purchase Agreement, under the Notes or under applicable law and all of
such rights, remedies and powers are hereby expressly reserved.
SECTION 2. AMENDMENT TO THE EXISTING 1996 WARRANT
AGREEMENT; AFFIRMATION.
2.1 AMENDMENT TO THE EXISTING 1996 WARRANT AGREEMENT.
The Company and, subject to the satisfaction of the conditions
set forth in Section 4, each of the Noteholders hereby amend and restate the
definition of "Initial Purchase Price" in the Existing 1996 Warrant Agreement
as set forth below:
INITIAL PURCHASE PRICE - means Two Dollars and Fifty
Cents ($2.50).
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2.2 AFFIRMATION OF OBLIGATIONS.
The Company hereby acknowledges and affirms all of its
obligations under the terms of the Note Purchase Agreement and under the
Existing 1996 Warrant Agreement, as amended hereby.
SECTION 3. WARRANTIES AND REPRESENTATIONS.
To induce the Noteholders to enter into this Agreement, the
Company warrants and represents to the Noteholders that as of the Effective
Date:
3.1 CORPORATE ORGANIZATION AND AUTHORITY.
The Company:
(a) is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware;
(b) has all legal and corporate power and
authority to own and operate its Properties and to carry on its
business as now conducted and as presently proposed to be conducted;
(c) has all licenses, certificates, permits,
franchises and other governmental authorizations necessary to own and
operate its Properties and to carry on its business as now conducted
and as presently proposed to be conducted, except where the failure to
have such licenses, certificates and permits, either individually or
in the aggregate, would not have, and could not reasonably be expected
to have, a Material Adverse Effect; and
(d) has duly qualified or has been duly licensed,
and is authorized to do business and is in good standing, as a foreign
corporation in each state except where the failure to be so qualified
or licensed and authorized and in good standing, either individually
or in the aggregate, would not have, and could not reasonably be
expected to have, a Material Adverse Effect.
3.2 COMPLIANCE WITH LAW.
The Company:
(a) is not in violation of any law, ordinance,
governmental rule or regulation to which it is subject; and
(b) has not failed to obtain any license,
certificate, permit, franchise or other governmental authorization
necessary to the ownership of its Property or to the conduct of its
business;
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which violation or failure to obtain, either individually or in the
aggregate, would have, or could reasonably be expected to have, a
Material Adverse Effect.
3.3 LEGAL AND AUTHORIZED; OBLIGATIONS ARE ENFORCEABLE.
(a) AUTHORIZATION. The execution and delivery by
the Company of this Agreement and the performance by the Company of
its obligations hereunder are within the corporate powers of the
Company and do not conflict with, result in any breach in any of the
provisions of, constitute a default under, or result in the creation
of any Lien upon any Property of the Company under the provisions of,
any agreement, charter instrument, bylaw or other instrument to which
it is a party or by which it or any of its Property may be bound.
(b) OBLIGATIONS ARE LEGAL AND ENFORCEABLE. The
execution and delivery by the Company of this Agreement have been duly
authorized by all necessary action on the part of the Company, and
this Agreement has been executed and delivered by one or more duly
authorized officers of the Company. This Agreement constitutes a
legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms, except that the
enforceability thereof may be:
(i) limited by applicable bankruptcy,
reorganization, arrangement, insolvency, moratorium or other
similar laws affecting the enforceability of creditors' rights
generally;
(ii) subject to the availability of
equitable remedies; and
(iii) with respect to indemnity and
contribution, limited by state or federal laws relating to
Securities or by the public policy underlying such laws.
3.4 NO DEFAULTS.
(a) NO OTHER DEFAULTS. No Defaults or Events of
Default exist, other than the Noticed Events of Default. No Senior
Nonpayment Default exists that has not been waived and no Senior
Nonpayment Default Notice has been issued by any holder of Senior
Debt.
(b) AMENDED FINANCING DOCUMENTS. No event has
occurred and no condition exists that, upon the execution, delivery
and effectiveness of this Agreement would constitute a Default or an
Event of Default other than in respect of the Noticed Events of
Default.
(c) CHARTER INSTRUMENT, OTHER AGREEMENTS. The
Company is not in violation in any respect of any term of any charter
instrument or bylaw. Except
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with respect to the failure of the Company to pay the promissory note
payable to Lucent Technologies, Inc., the Company is not in violation
in any material respect of any term in any agreement or other
instrument to which it is a party or by which it or any of its
Property may be bound, which would have, or could reasonably be
expected to have, a Material Adverse Effect.
SECTION 4. CONDITIONS.
The waiver by the Noteholders set forth in Section 1 and the
amendment described in Section 2 shall become effective on October 31, 1996 (the
"Effective Date"), subject to all of the following conditions having been
satisfied on or prior to such date:
4.1 EXECUTION AND DELIVERY OF THIS AGREEMENT.
The Company and the Required Holders and all of the
Warrantholders (as such term is defined in the Existing 1996 Warrant Agreement)
shall have executed and delivered counterparts of this Agreement.
4.2 WAIVER BY HOLDERS OF SENIOR DEBT.
The Company and each holder of Senior Debt whose consent is
required therefor pursuant to the terms of the Senior Credit Documents shall
have executed and delivered waivers with respect to all defaults and all events
of default which exist under such Senior Credit Documents (including, without
limitation, each of such events that relate to each of the Noticed Events of
Default). The Company shall have delivered to each Noteholder a copy of the
Limited Waiver entered into among the Company and the holders of Senior Debt,
in the form of the execution draft of the Limited Waiver previously delivered
to each Noteholder, together with a certification by a Senior Officer of the
Company stating that such copy is a true and correct copy and such Limited
Waiver cures or waives all defaults and all events of default which exist under
the Senior Credit Documents.
4.3 NO DEFAULT; REPRESENTATIONS AND WARRANTIES TRUE.
After giving effect to Section 1 hereof, no Default or Event
of Default under the Note Purchase Agreement shall exist and the warranties and
representations set forth in Section 3 hereof shall be true and correct on the
Effective Date.
4.4 AUTHORIZATION OF TRANSACTIONS.
The Company shall have authorized, by all necessary corporate
action, its execution, delivery and performance of this Agreement and the
consummation of all transactions contemplated by this Agreement and evidence of
the same shall have been delivered to the Noteholders.
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4.5 EXPENSES.
The Company shall have paid all costs and expenses of the
Noteholders relating to this Agreement (including, without limitation, any fees
and disbursements of their special counsel).
4.6 PROCEEDINGS SATISFACTORY.
All proceedings taken in connection with this Agreement shall
be satisfactory to the Noteholders and their special counsel. The Noteholders
and their special counsel shall have received copies of such documents and
papers as they may reasonably request in connection therewith, in form and
substance satisfactory to them.
SECTION 5. MISCELLANEOUS.
5.1 GOVERNING LAW.
THIS AGREEMENT SHALL BE CONSTRUED, INTERPRETED AND ENFORCED IN
ACCORDANCE WITH, AND GOVERNED BY, INTERNAL NEW YORK LAW.
5.2 DUPLICATE ORIGINALS.
Two or more duplicate originals of this Agreement may be
signed by the parties, each of which shall be an original but all of which
together shall constitute one and the same instrument. This Agreement may be
executed in one or more counterparts and shall be effective when at least one
counterpart shall have been executed by each party hereto, and each set of
counterparts which, collectively, show execution by each party hereto shall
constitute one duplicate original.
5.3 EFFECT OF THIS AGREEMENT.
Except as specifically provided in this Agreement, no terms or
provisions of the Note Purchase Agreement have been modified or changed by this
Agreement and the terms and provisions of the Note Purchase Agreement shall
continue in full force and effect. Except as specifically provided in this
Agreement, no terms or provisions of the Existing 1996 Warrant Agreement have
been modified or changed by this Agreement and the terms and provisions of the
Existing 1996 Warrant Agreement, as amended hereby, shall continue in full
force and effect. This Agreement and the waivers and amendments contained
herein shall have and be in effect on and after the Effective Date.
5.4 WAIVERS AND AMENDMENTS OF THIS AGREEMENT.
Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated orally, or by any action or inaction, but only
by an instrument in
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writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
5.5 SECTION HEADINGS.
The titles of the sections hereof appear as a matter of
convenience only, do not constitute a part of this Agreement and shall not
affect the construction hereof.
5.6 COSTS AND EXPENSES.
On the Effective Date, the Company shall pay all costs and
expenses of the Noteholders related hereto, including, but not limited to, the
statement for fees and disbursements of the Noteholders' special counsel
presented to the Company on the Effective Date for matters in connection with
this Agreement. The Company will also pay upon receipt of any statement
thereof, each additional statement for fees and disbursements of the
Noteholders' special counsel rendered after the Effective Date in connection
with this Agreement. The obligations of the Company under this Section 5.6
shall survive the payment or prepayment of the Notes and the termination of the
Note Purchase Agreement.
5.7 SURVIVAL.
All warranties, representations, certifications and covenants
made by the Company hereunder, or in any certificate or other instrument
delivered pursuant hereto or thereto, shall be considered to have been relied
upon by the Noteholders and shall survive the execution of this Agreement
regardless of any investigation made by or on behalf of the Noteholders. All
statements in any such certificate or other instrument shall constitute
warranties and representations of the Company hereunder.
[REMAINDER OF PAGE INTENTIONALLY BLANK. NEXT PAGE IS SIGNATURE PAGE.]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed on their behalf by a duly authorized officer or agent
thereof, as the case may be, as of the date first above written.
THE CERPLEX GROUP, INC.
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Name:
Title:
ACCEPTED:
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
By:
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Name:
Title:
XXXX XXXXXXX MUTUAL LIFE INSURANCE COMPANY
By:
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Name:
Title:
NORTH ATLANTIC SMALLER COMPANIES INVESTMENT TRUST PLC
By:
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Name:
Title:
[Signature page to the WAIVER AND AMENDMENT AGREEMENT among THE CERPLEX GROUP,
INC. and the Noteholders listed therein.]
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SCHEDULE A
Amendment No. 1 to Note Purchase Agreement dated as of May 26, 1994.
Amendment No. 2 to Note Purchase Agreement dated as of July 29, 1994.
Amendment Agreement dated as of October 27, 1994.
Waiver and Amendment Agreement dated as of April 15, 1996.
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