EXHIBIT 10.4(a)
EXECUTION
PRIME SUCCESSION, INC.
FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is dated as
of September 30, 1998 and entered into by and among PRIME SUCCESSION, INC.
(formerly known as Prime Succession Acquisition Corp.), a Delaware corporation
("Borrower"), PRIME SUCCESSION HOLDINGS, INC. (formerly known as Prime
Succession, Inc.), a Delaware corporation ("Holdings"), THE FINANCIAL
INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF (each individually referred to
herein as a "Lender" and collectively as the "Lenders"), XXXXXXX XXXXX CREDIT
PARTNERS L.P., as syndication agent and arranging agent (in such capacities,
"Arranging Agent"), and THE BANK OF NOVA SCOTIA ("ScotiaBank"), as
administrative agent (in such capacity, "Administrative Agent"), and is made
with reference to that certain Credit Agreement dated as of August 26, 1996, as
heretofore amended, supplemented or otherwise modified (as so amended,
supplemented or modified, the "Credit Agreement"), by and among Borrower,
Holdings, the Lenders, Arranging Agent and Administrative Agent. Capitalized
terms used herein without definition shall have the same meanings herein as set
forth in the Credit Agreement and in the amendments contained in Section 1
hereof.
RECITALS
WHEREAS, the parties to the Credit Agreement desire to amend the Credit
Agreement (i) to permit the substitution of surety bonds for certain letters of
credit and merchandise trust funds and (ii) to make certain other amendments as
set forth herein.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
SECTION 1. AMENDMENTS TO CREDIT AGREEMENT
1.1 Amendments to Section 1: Definitions
A. Subsection 1.1 of the Credit Agreement is hereby amended by deleting
the definitions of "Leverage Ratio" and "Total Senior Debt" therefrom in their
entirety and substituting therefor the following:
"Leverage Ratio" means the ratio of (i) Consolidated Total Debt as of
the last day of any Fiscal Quarter plus 75% of the aggregate amount of surety
bonds outstanding as of such date pursuant to subsection 7.4(ix), to (ii)
Consolidated Adjusted EBITDA for the four Fiscal Quarter period then ended, in
each case as set forth in the most recent Compliance Certificate delivered by
Borrower to Administrative Agent and Lenders pursuant to clause (iii) of
subsection 6.1.
"Total Senior Debt" means, as at any date of determination, the sum of
(i) the aggregate stated balance sheet amount of all Indebtedness and Contingent
Obligations of Holdings and its Subsidiaries in respect of Indebtedness, in each
case other than Indebtedness evidenced by the Senior Subordinated Notes and
Indebtedness in respect of the Batesville Liability and Covenants not to
Compete, all as determined on a consolidated basis in accordance with GAAP, plus
(ii) 75% of the aggregate amount of surety bonds outstanding pursuant to
subsection 7.4(ix).
B. Subsection 1.1 of the Credit Agreement is hereby further amended by
adding the following definition of "Specified Merchandise Trusts" thereto in
proper alphabetical order:
"Specified Merchandise Trusts" means (i) the Xxxx Xxxxxx Memorial
Merchandise Trust, DTD July 23, 1993, Account Number: 00000000 with a balance at
August 31, 1998 of $1,308,337 and (ii) the Xxxx Xxxxxx Memorial Service Trust
Post, DTD October 1, 1993, Account Number: 00000000 with a balance at August 31,
1998 of $4,331,086.
1.2 Amendments to Section 7: Negative Covenants
Subsection 7.4 of the Credit Agreement is hereby amended by (i)
deleting the "and" at the end of clause (vi) thereof, (ii) deleting the "." at
the end of clause (vii) thereof, and (iii) adding a new clause (viii) and a new
clause (ix) at the end thereof as follows:
"(viii) Borrower and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of surety bonds used to replace the
Letters of Credit described on Schedule 3.1 annexed hereto so long as such
surety bonds support only the obligations supported by such Letters of Credit;
provided that the aggregate amount of the Contingent Obligations in respect of
such surety bonds shall not exceed the aggregate amount of such replaced Letters
of Credit; and
(ix) Borrower and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of surety bonds utilized by
Borrower and its Subsidiaries in lieu of funding the Specified Merchandise
Trusts pursuant to the Florida Administrative Code; provided that the aggregate
amount of the Contingent Obligations at any time outstanding in respect of such
surety bonds shall not exceed the lesser of (x) $20,000,000 and (y) the sum of
(1) $10,000,000 plus (2) as of any date of determination, an additional
$2,000,000 for each Fiscal Year which shall have commenced on or after January
1, 1999."
SECTION 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Amendment shall become effective only upon the prior
or concurrent satisfaction of all of the following conditions precedent (the
date of satisfaction of such conditions being referred to herein as the "First
Amendment Effective Date"):
On or before the First Amendment Effective Date, each of Borrower and
Holdings shall have delivered to Lenders (or to Administrative Agent for Lenders
with sufficient originally executed copies, where appropriate, for each Lender
and its counsel) a certificate of its corporate secretary or an assistant
secretary dated the First Amendment Effective Date certifying that (i) there
have been no amendments to its Certificate of Incorporation or Bylaws after the
Closing Date, (ii) attached resolutions of its Board of Directors authorizing
this Amendment are in full force and effect without modification or amendment,
and (iii) there have been no changes after the Closing Date in the incumbency of
its officers, together with a good standing certificate from the Secretary of
State of the State of Delaware, dated a recent date prior to the First Amendment
Effective Date.
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Amendment and to amend
the Credit Agreement in the manner provided herein, Holdings and Borrower each
represents and warrants to each Lender that the following statements are true,
correct and complete:
A. Corporate Power and Authority. Each of Holdings and Borrower has all
requisite corporate power and authority to enter into this Amendment and to
carry out the transactions contemplated by, and perform its obligations under,
the Credit Agreement as amended by this Amendment (the "Amended Agreement") and
the other Loan Documents.
B. Authorization of Agreements. The execution and delivery of this
Amendment and the performance of the Amended Agreement and the other Loan
Documents have been duly authorized by all necessary corporate action on the
part of Holdings and Borrower.
C. No Conflict. The execution and delivery by each of Holdings and
Borrower of this Amendment and the performance by each of Holdings and Borrower
of the Amended Agreement and the other Loan Documents do not and will not (i)
violate any provision of any law or any governmental rule or regulation
applicable to Holdings, Borrower or any of its Subsidiaries, the Certificate or
Articles of Incorporation or Bylaws of Holdings, Borrower or any of its
Subsidiaries or any order, judgment or decree of any court or other agency of
government binding on Holdings, Borrower or any of its Subsidiaries, (ii)
conflict with, result in a breach of or constitute (with due notice or lapse of
time or both) a default under any Contractual Obligation of Holdings, Borrower
or any of its Subsidiaries, (iii) result in or require the creation or
imposition of any Lien upon any of the properties or assets of Holdings,
Borrower or any of its Subsidiaries, or (iv) require any approval of
stockholders or partners or any approval or consent of any Person under any
Contractual Obligation of Holdings, Borrower or any of its Subsidiaries, except
for such approvals or consents which have been obtained and disclosed in writing
to Lenders.
D. Governmental Consents. The execution and delivery by each of
Holdings and Borrower of this Amendment and the performance by each of Holdings
and Borrower of the Amended Agreement, the other Loan Documents and the
transactions contemplated by this Amendment do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body other than the approval of the Florida State Board of Funeral Services
which will be obtained on or before the date the transactions contemplated by
this Amendment are consummated.
E. Binding Obligation. This Amendment and the Amended Agreement have
been duly executed and delivered by each of Holdings and Borrower and are the
legally valid and binding obligations of each of Holdings and Borrower,
enforceable against each of Holdings and Borrower in accordance with their
respective terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors'
rights generally or by equitable principles relating to enforceability.
F. Incorporation of Representations and Warranties From Credit
Agreement. The representations and warranties contained in Section 5 of the
Credit Agreement are and will be true, correct and complete in all material
respects on and as of the First Amendment Effective Date to the same extent as
though made on and as of that date, except to the extent such representations
and warranties specifically relate to an earlier date, in which case they were
true, correct and complete in all material respects on and as of such earlier
date.
G. Absence of Default. No event has occurred and is continuing or will
result from the consummation of the transactions contemplated by this Amendment
that would constitute an Event of Default or a Potential Event of Default.
SECTION 4. MISCELLANEOUS
A. Reference to and Effect on the Credit Agreement and the Other Loan
Documents.
(i) On and after the First Amendment Effective Date, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or words
of like import referring to the Credit Agreement, and each reference in the
other Loan Documents to the "Credit Agreement", "thereunder", "thereof" or words
of like import referring to the Credit Agreement shall mean and be a reference
to the Credit Agreement as amended by this Amendment.
(ii) 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.
(iii) The execution, delivery and performance of this Amendment shall not,
except as expressly provided herein, constitute a waiver of any provision of, or
operate as a waiver of any right, power or remedy of any Agent or Lender under,
the Credit Agreement or any of the other Loan Documents.
B. Headings. Section and subsection 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 or be given any substantive effect.
C. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 51401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
D. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document. This Amendment (other than the provisions of Section 1
hereof) shall become effective upon the execution of a counterpart hereof by
Holdings, Borrower and Requisite Lenders and receipt by Borrower and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered by their respective officers thereunto duly authorized as
of the date first written above.
BORROWER: PRIME SUCCESSION, INC.
By:/s/XXXXX X. XXXXXX
---------------------
Name:Xxxxx X. Xxxxxx
Title:Chief Financial Officer
HOLDINGS: PRIME SUCCESSION HOLDINGS, INC.
By:/s/XXXXX X. XXXXXX
---------------------
Name:Xxxxx X. Xxxxxx
Title:Chief Financial Officer
AGENTS AND LENDERS: XXXXXXX SACHS CREDIT PARTNERS L.P.,
individually and as Arranging Agent and
Syndication Agent
By:/s/XXXXXXX X. XXXX
---------------------
Authorized Signatory
THE BANK OF NOVA SCOTIA,
as a Lender and as Administrative Agent
By:/s/F.C.H. XXXXX
------------------
Name:F.C.H. Xxxxx
Title:Senior Manager Loan Operations
MASSACHUSETTS MUTUAL LIFE INSURANCE CO.
as a Lender
By:/s/XXXXXX X. XXXX
--------------------
Name:Xxxxxx X. Xxxx
Title:Second Vice President and Associate
General Counsel
CAPTIVA FINANCE LTD.
as a Lender
By:/s/XXXXX EGGLISHAW
---------------------
Name:Xxxxx Egglishaw
Title:Director
INDOSUEZ CAPITAL FUNDING IIA, LIMITED
as a Lender
by Indosuez Capital as Collateral Manager
By:/s/XXXXXXXXX XXXXXXXXX
-------------------------
Name:Xxxxxxxxx Xxxxxxxxx
Title:Vice President
XXXXX XXX & FARNHAM INCORPORATED
as agent for
KEYPORT LIFE INSURANCE COMPANY
as a Lender
By:/s/XXXXX X. GOOD
-------------------
Name:Xxxxx X. Good
Title:Vice President & Portfolio Manager
XXXXXXX XXXXX SENIOR FLOATING RATE FUND
as a Lender
By:/s/XXXXXX XXXXXXXX
---------------------
Name:Xxxxxx Xxxxxxxx, CFA
Title:Authorized Signatory
XXXXXXX XXXXX PRIME RATE PORTFOLIO
as a Lender
By:/s/XXXXXX XXXXXXXX
---------------------
Name:Xxxxxx Xxxxxxxx, CFA
Title:Authorized Signatory
NEW YORK LIFE INSURANCE COMPANY
as a Lender
By:/s/XXXXXX X. XXXXXXXXX
-------------------------
Name:Xxxxxx X. Xxxxxxxxx
Title:Director
XXXXXX XXXXXXX XXXX XXXXXX
PRIME INCOME TRUST
as a Lender
By:/s/XXXXXX XXXXXXXX
---------------------
Name:Xxxxxx Xxxxxxxx
Title:Vice President
SENIOR DEBT PORTFOLIO
By: Boston management and Research
as Investment Advisor
By:/s/PAYSON X. XXXXXXXXX
-------------------------
Name:Payson X. Xxxxxxxxx
Title:Vice President
