Exhibit 10.1
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FIRST AMENDMENT TO CREDIT AGREEMENT
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THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), dated as of
October 5, 2005, is entered into among TEAM, INC, a Texas corporation (the
"Borrower"), the lenders that are parties to the Credit Agreement defined below
(collectively, the "Lenders"), and BANK OF AMERICA, N.A., as Administrative
Agent for itself and the Lenders (in said capacity, the "Administrative Agent"),
and as Swing Line Lender and L/C Issuer.
BACKGROUND
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A. The Borrower, the Lenders, the Administrative Agent, the Swing Line
Lender and the L/C Issuer are parties to that certain Credit Agreement, dated as
of August 11, 2004 (as amended through the date hereof, the "Credit Agreement").
Terms defined in the Credit Agreement and not otherwise defined herein shall be
used herein as defined in the Credit Agreement.
B. The Borrower, the Lenders, the Administrative Agent, the Swing Line
Lender and the L/C Issuer desire to make certain amendments to the Credit
Agreement.
NOW, THEREFORE, in consideration of the covenants, conditions and
agreements hereinafter set forth, and for other good and valuable consideration,
the receipt and adequacy of which are all hereby acknowledged, the Borrower, the
Lenders, the Administrative Agent, the Swing Line Lender and the L/C Issuer
covenant and agree as follows:
1. AMENDMENTS TO CREDIT AGREEMENT. The Credit Agreement is hereby amended
as follows:
(a) Section 1.01 is amended by amending and restating the definition
of "Applicable Rate", as follows:
"Applicable Rate" means the following percentages per annum, based
upon the Leverage Ratio as set forth in the most recent Compliance
Certificate received by the Administrative Agent pursuant to Section
6.02(b):
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Eurodollar Rate
Pricing Revolving for Loans and Base Rate
Level Leverage Ratio Commitment Fee Letters of Credit for Loans
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I Less than or equal to 1.50 to 1.00 0.250 1.500 0.000
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II Greater than 1.50 to 1.00 but less than or equal 0.300 1.750 0.250
to 2.00 to 1.00
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III Greater than 2.00 to 1.00 but less than or equal 0.375 2.000 0.500
to 2.50 to 1.00
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IV Greater than 2.50 to 1.00 but less than or equal 0.500 2.250 0.750
to 3.00 to 1.00
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V Greater than 3.00 to 1.00 0.625 2.500 1.000
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Any increase or decrease in the Applicable Rate resulting from a
change in the Leverage Ratio shall become effective as of the first
Business Day immediately following the date a Compliance Certificate is
delivered for any Fiscal Quarter pursuant to Section 6.02(b); provided,
however, that if a Compliance Certificate is not delivered when due in
accordance with such Section 6.02(b), then Pricing Level V shall apply as
of the first Business Day after the date on which such Compliance
Certificate was required to have been delivered and shall remain in effect
until the first Business Day immediately following the date such Compliance
Certificate is actually delivered to the Administrative Agent.
(b) Section 1.01 is amended by amending and restating clause (a) of
the definition of "Consolidated Funded Indebtedness", as follows:
(a) the outstanding principal amount of all obligations, whether
current or long-term, for borrowed money (including Obligations
hereunder) and all obligations evidenced by bonds, debentures, notes,
loan agreements or other similar instruments, other than amounts owed
pursuant to insurance premium financings,
(c) Section 1.01 is amended by adding the definition of "Climax Sale"
in alphabetical order, as follows:
"Climax Sale" means the sale of substantially all of the assets
of Climax Portable Machine Tool Co. for Net Cash Proceeds of not less
than $12,000,000.
(d) Section 2.06 is amended by adding the following proviso at the
end of clause (h) thereof immediately preceding the period ("."):
provided that notwithstanding any of the above in clause (iii) to
the contrary, whether or not Term Loans remain outstanding on the date
the Climax Sale is consummated, any mandatory prepayment of Loans from
Net Cash Proceeds of the Climax Sale shall be applied to the Revolving
Loans (which repayment shall not result in a reduction in the
Aggregate Revolving Commitments)
(e) Section 7.14(b) is amended and restated in its entirety, as
follows:
(b) Leverage Ratio. Permit the Leverage Ratio as of the end of
any Fiscal Quarter of the Borrower set forth below to be greater than
the ratio set forth below opposite such Fiscal Quarter:
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Fiscal Quarters Ending Maximum Leverage Ratio
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August 31, 2005 4.00 to 1.00
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November 30, 2005 3.75 to 1.00
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February 28, 2006 3.25 to 1.00
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Each Fiscal Quarter thereafter 3.00 to 1.00
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provided that, notwithstanding anything herein to the contrary, upon
the date of consummation of the Climax Sale, the above ratios for
Fiscal Quarters ending after such date shall automatically be amended
to be 3.00 to 1.00, and at the end of any Fiscal Quarter after such
date, the Borrower shall not permit the Leverage Ratio as of the end
of any Fiscal Quarter of the Borrower to be greater than 3.00 to 1.00.
2. AMENDMENT FEE. Borrower shall pay to the Administrative Agent, for the
pro rata benefit of the Lenders, an amendment fee in an amount equal to the
product of 0.05% multiplied by the sum of (a) the Aggregate Revolving
Commitments and (b) the outstanding principal amount of the Term Loan (the
"Amendment Fee"). Such Amendment Fee shall be paid in immediately available
funds and shall be due and payable on the date hereof.
3. REPRESENTATIONS AND WARRANTIES. By its execution and delivery hereof,
the Borrower represents and warrants to the Lenders that, as of the date hereof:
(a) after giving effect to this Amendment, the representations and
warranties contained in the Credit Agreement and the other Loan Documents
are true and correct on and as of the date hereof as if made on and as of
such date, except to the extent that such representations and warranties
expressly relate solely to an earlier date (in which case such
representations and warranties shall have been true and accurate in all
material respects on and as of such earlier date);
(b) after giving effect to this Amendment, no event has occurred and
is continuing which constitutes an Event of Default;
(c) the Borrower has legal power and authority to execute and deliver
this Amendment, and this Amendment constitutes the legal, valid and binding
obligation of the Borrower, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy or other
debtor relief laws and by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law) and
except as rights to indemnity may be limited by federal or state securities
laws;
(d) neither the execution, delivery and performance of this Amendment
nor the consummation of any transactions contemplated herein will violate
or conflict with, or result in a breach of, or constitute a default under,
or require any consent under (i) the articles of incorporation, bylaws or
other organizational documents of the Borrower, (ii) any applicable law,
rule, or regulation or any order, writ, injunction, or decree of any
Governmental Authority or arbitrator, or (iii) any agreement or instrument
to which the Borrower is a party or by which it or any of its property is
bound or subject; and
(e) no authorization, approval, consent, or other action by, notice
to, or filing with, any Governmental Authority or other Person (including
the Board of Directors of Borrower), is required for the execution,
delivery or performance by the Borrower of this Amendment.
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4. CONDITIONS OF EFFECTIVENESS. This Amendment shall be effective only
after each of the following conditions precedent shall have been satisfied:
(a) the Administrative Agent shall receive counterparts of this
Amendment executed by the Required Lenders and the Borrower;
(b) the representations and warranties set forth in Section 3 of this
Amendment shall be true and correct;
(c) the Amendment Fee and any other fee agreed to by the Borrower
under separate agreement in connection herewith shall have been paid;
(d) all reasonable out-of-pocket fees and expenses of the
Administrative Agent in connection with the Loan Documents, including this
Amendment, including legal fees and expenses incurred on or prior to the
date of this Amendment by the Administrative Agent, including, without
limitation, the reasonable fees and expenses of Xxxxxxxx Xxxxxxxx & Xxxxxx
P.C., shall have been paid; and
(e) the Administrative Agent shall receive, in form and substance
satisfactory to the Administrative Agent and its counsel, such other
documents, certificates and instruments as the Administrative Agent shall
reasonably require.
5. REFERENCE TO CREDIT AGREEMENT. Upon the effectiveness of this
Amendment, each reference in the Credit Agreement to "this Agreement,"
"hereunder," or words of like import shall mean and be a reference to the Credit
Agreement, as affected and amended by this Amendment.
6. COUNTERPARTS; EXECUTION VIA FACSIMILE. This Amendment may be executed
in one or more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument. This Amendment
may be validly executed and delivered by facsimile or other electronic
transmission.
7. GOVERNING LAW: BINDING EFFECT. This Amendment shall be governed by and
construed in accordance with the laws of the State of Texas and shall be binding
upon the Borrower, the Administrative Agent, each Lender and their respective
successors and assigns.
8. HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
9. LOAN DOCUMENT. This Amendment is a Loan Document and is subject to all
provisions of the Credit Agreement applicable to Loan Documents, all of which
are incorporated in this Amendment by reference the same as if set forth in this
Amendment verbatim.
10. NO ORAL AGREEMENTS. THIS WRITTEN AGREEMENT AND THE OTHER LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
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AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
Remainder of page intentionally blank.
Signature pages follow.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
BORROWER:
TEAM, INC.
By: /s/ Xxx X. Xxxx
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Name: Xxx X. Xxxx
Title: Senior Vice President
ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A., as Administrative Agent
By: /s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
Vice President
First Amendment
Signature Page
AGREED TO this 5 day of October, 2005.
BANK OF AMERICA, N.A., COMERICA BANK
as Swing Line Lender, L/C Issuer and a Lender
By: /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx By:/s/ Xxxxx Xxxxxxxx
Senior Vice President ------------------
Name: Xxxxx Xxxxxxxx
Title: Vice President
JPMORGAN CHASE BANK, N.A. COMPASS BANK
By: /s/ Xxxx Xxxxxx By:/s/ Xxx Xxxxxx
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Name: Xxxx Xxxxxx Name: Xxx Xxxxxx
Title: Vice President Title: Senior Vice President
AMEGY BANK, N.A. GUARANTY BANK
By:/s/ Xxxxx X. Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxx By:/s/ Xxxxx Xxxxxx
Title: Vice President ----------------
Name: Xxxxx Xxxxxx
Title: Man. Dir.
First Amendment
Signature Page
Each of the undersigned hereby (a) consents and agrees to this Amendment's
execution and delivery, (b) ratifies and confirms its obligations under its
guaranty, (c) acknowledges and agrees that its obligations under its guaranty
are not released, diminished, impaired, reduced, or otherwise adversely affected
by this Amendment, and (d) acknowledges and agrees that it has no claims or
offsets against, or defenses or counterclaims to, its guaranty.
GUARANTORS:
TEAM INDUSTRIAL SERVICES, INC.
TEAM INVESTMENT, INC.
LEAK REPAIRS, INC.
CLIMAX PORTABLE MACHINE TOOLS, INC.
THERMAL SOLUTIONS, INC.
X-RAY INSPECTION, INC.
TEAM COOPERHEAT-MQS, INC.
TEAM INDUSTRIAL SERVICES OF CANADA, INC.
By: /s/ Xxx X. Xxxx
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Name: Xxx X. Xxxx
Title: Senior Vice President
TEAM FACILITIES & SERVICES, L.P.
By: Team, Inc., its General Partner
By: /s/ Xxx X. Xxxx
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Name: Xxx X. Xxxx
Title: Senior Vice President
First Amendment
Signature Page
