EXHIBIT 10.72.2
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SECOND AMENDMENT TO CREDIT AGREEMENT
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THIS SECOND AMENDMENT TO CREDIT AGREEMENT is made as of the __ day of
August, 2001 by and among CORRECTIONAL SERVICES CORPORATION, a corporation duly
organized and validly existing under the laws of the State of Delaware (the
"Company"); each of the Subsidiaries of the Company that is a signatory hereto
or that, pursuant to Section 9.1.20(b) of the Credit Agreement (as hereinafter
defined), shall become a party hereto (individually, a "Subsidiary Guarantor"
and, collectively, the "Subsidiary Guarantors"; and the Subsidiary Guarantors
collectively with the Company, the "Obligors"); each of the lenders that is a
signatory hereto or that, pursuant to Section 12.6(b) of the Credit Agreement,
shall become a "Lender" hereunder (individually, a "Lender" and, collectively,
the "Lenders"); and FLEET NATIONAL BANK, a national banking association and
successor by merger to Summit Bank, as syndication agent for the Lenders (in
such capacity, together with its successors in such capacity, the "Syndication
Agent").
W I T N E S S E T H:
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WHEREAS, the Company, the Subsidiary Guarantors, the Lenders and the
Syndication Agent entered into a Credit Agreement dated August 31, 1999, as
amended by a first amendment thereto dated as of November 10, 2000
(collectively, the "Credit Agreement"); and
WHEREAS, the Company has requested the Syndication Agent and the
Lenders to make certain amendments to the Credit Agreement as more fully
described herein, and the Syndication Agent and the Lenders have agreed to do
so, subject to and in accordance with the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Defined Terms. Except as otherwise indicated herein, all words
and terms defined in the Credit Agreement shall have the same meanings when used
herein.
2. Amendments to Credit Agreement.
(a) Section 1.1 of the Credit Agreement is amended by adding
the following definition thereto:
"Fleet National Bank" shall mean Fleet National Bank, a
national banking association.
(b) The following definitions appearing in Section 1.1 of the
Credit Agreement are hereby amended to read in their entirety as follows:
"Applicable Commitment Fee Rate" shall mean:
(i) with reference to the Revolving Credit
Commitments, a rate per annum, determined from time to time in
accordance with the table set forth below. The Applicable Commitment
Fee Rate shall change on the fifth Business Day following receipt by
the Syndication Agent of a Compliance Certificate of the Company
demonstrating that the ratio of the consolidated Total Funded Debt of
the Company and its Subsidiaries to Adjusted EBITDA as at the last day
of the immediately preceding fiscal quarter of the Company shall be at
a different level in the table below, whereupon the Applicable
Commitment Fee Rate shall be reduced or increased to the applicable
percentage set forth in such table. Notwithstanding the foregoing, the
Applicable Commitment Fee Rate shall not be reduced at any time during
which an Event of Default shall have occurred and be continuing:
Ratio of Total Funded Applicable Commitment Fee
Debt to Rate for Revolving Credit
Level Adjusted EBITDA Commitments
----- --------------- -------------------------
I < 3.25:1 and
-
> 3.00:1 .50%
-
II < 3.00:1 and
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> 2.50:1 .50%
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III < 2.50:1 and
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> 2.00:1 .375%
-
IV < 2.00:1 .375%
-
"Applicable Margin" shall mean:
(i) with reference to Revolving Credit Loans that are
Base Rate Loans or LIBOR Loans, an amount in excess of the Base Rate or
the LIBOR Rate, as the case may be, determined from time to time in
accordance with the table set forth below. The Applicable Margin shall
change on the fifth Business Day following receipt by the Syndication
Agent of a Compliance Certificate of the Company demonstrating that the
ratio of the consolidated Total Funded Debt of the Company and its
Subsidiaries to Adjusted EBITDA as at the last day of the immediately
preceding fiscal quarter of the Company shall be at a different level
in the table below, whereupon the Applicable Margin shall be reduced or
increased to the applicable percentage set forth in such table.
Notwithstanding the foregoing, the Applicable Margin shall not be
reduced at any time during which an Event of Default shall have
occurred and be continuing:
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Applicable Margin for Applicable Margin for
Ratio of Total Revolving Credit Revolving Credit Loans
Funded Debt to Loans that are that are
Level Adjusted EBITDA Base Rate Loans LIBOR Loans
----- --------------- --------------- -----------
I < 3.25:1 and 1.75% 3.25%
-
> 3.00:1
-
II < 3.00:1 and 1.50% 3.00%
-
> 2.50:1
-
III < 2.50:1 and 1.25% 2.75%
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> 2.00:1
-
IV < 2.00:1 1.00% 2.50%
-
"Syndication Agent" shall mean Fleet National Bank, its
successors and assigns.
(c) Section 9.1.10 of the Credit Agreement is hereby amended
to read in its entirety as follows:
9.1.10 Total Funded Debt to Adjusted EBITDA Ratio.
The Company will not permit the ratio of (i) the consolidated
Total Funded Debt of the Company and its Subsidiaries as of the last
day of any fiscal quarter of the Company ending during any test period
set forth in the table below, to (ii) Adjusted EBITDA for the period of
four consecutive fiscal quarters ending on the same day, to be greater
than the ratio set forth opposite such test period below:
Four Fiscal
Quarters Ending Ratio
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June 30, 2001 3.25:1
September 30, 2001 2.50:1
and thereafter
(d) All references in the Credit Agreement to "Summit Bank"
are hereby amended to read "Fleet National Bank".
3. Amendment Fees. Concurrently herewith and in consideration for the
Syndication Agent and the Lenders entering into this Agreement, the Company is
paying the Syndication Agent (a) an amendment fee in the amount of $127,500 for
the ratable benefit of the Lenders and (b) an amendment fee in the amount of
$51,000 for the sole benefit of the Syndication Agent. The foregoing fees are
earned in full on the date hereof and not subject to rebate or reduction.
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4. Guaranty Reaffirmation. The Subsidiary Guarantors hereby acknowledge
and agree to the amendments to the Credit Agreement effected by this Agreement.
Each of the Subsidiary Guarantors hereby reaffirms all of the terms and
conditions of the guaranty set forth in Section 6 of the Credit Agreement and
agrees that such guaranty is applicable to all of the Guaranteed Obligations, as
amended by this Agreement. The Subsidiary Guarantors hereby acknowledge and
agree that they have no defenses, offsets or counterclaims with respect to the
Guaranteed Obligations and hereby waive and release all claims against the
Syndication Agent and the Lenders with respect thereto.
5. Representations and Warranties. In order to induce the Syndication
Agent and the Lenders to enter into this Agreement and amend the Credit
Agreement as provided herein, each Obligor hereby represents and warrants to the
Syndication Agent and the Lenders that:
(a) All of the representations and warranties of the Obligors
set forth in the Credit Agreement are true, complete and correct in all material
respects on and as of the date hereof with the same force and effect as if made
on and as of the date hereof and as if set forth at length herein.
(b) After giving effect to this Agreement, no Default or Event
of Default presently exists and is continuing on and as of the date hereof.
(c) Since the date of the Obligors' most recent financial
statements delivered to the Syndication Agent, no Material Adverse Effect has
occurred, and no event has occurred or failed to occur which has had or is
likely to have a Material Adverse Effect.
(d) Each Obligor has full power and authority to execute,
deliver and perform any action or step which may be necessary to carry out the
terms of this Agreement and all other agreements, documents and instruments, if
any, executed and delivered by the Obligors to the Syndication Agent and the
Lenders concurrently herewith or in connection herewith (collectively, the
"Amendment Documents"); each Amendment Document to which any of the Obligors is
a party has been duly executed and delivered by such Obligors and is the legal,
valid and binding obligation of such Obligor enforceable in accordance with its
terms, subject to any applicable bankruptcy, insolvency, general equity
principles or other similar laws affecting the enforcement of creditors' rights
generally.
(e) The execution, delivery and performance of the Amendment
Documents will not (i) violate any provision of any existing law, statute, rule,
regulation or ordinance binding upon the Obligors, (ii) conflict with, result in
a breach of, or constitute a default under (A) the certificate of incorporation
or by-laws or other equivalent formation documents of any Obligor, (B) any
order, judgment, award or decree of any court, governmental authority, bureau or
agency, or (C) any mortgage, indenture, material lease, contract or other
material agreement or undertaking to which any Obligor is a party or by which
any Obligor or its properties or assets may be bound, or (iii) result in the
creation or imposition of any lien or other encumbrance upon or with respect to
any property or asset now owned or hereafter acquired by any Obligor, other than
liens in favor of the Syndication Agent for the ratable benefit of the Lenders.
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(f) No consent, license, permit, approval or authorization of,
exemption by, notice to, report to, or registration, filing or declaration with
any Person is required in connection with the execution, delivery, performance
by the Obligors of the Amendment Documents or the transactions contemplated
thereby.
6. Syndication Agent's Costs. The Company shall on demand reimburse the
Syndication Agent for all out-of-pocket costs, including legal fees and
expenses, incurred by the Syndication Agent in connection with this Agreement,
the transactions referenced herein and the administration of the facilities
described in the Credit Agreement. In the event the Company shall fail to pay
any such invoice within 10 days, the Company irrevocably authorizes the
Syndication Agent to charge the Company's account(s) with the Syndication Agent
(or its affiliate) in the amount of such out-of-pocket costs.
7. No Change. Except as expressly set forth herein or modified hereby,
all of the terms and provisions of the Credit Agreement and the other Basic
Documents are hereby reaffirmed in their entirety shall continue in full force
and effect.
8. Counterparts; Effectiveness. This Agreement may be executed in any
number of counterparts, each of which shall be an original and all of which
shall constitute one and the same instrument. This Agreement shall not be
binding upon any party until all parties hereto have executed this Agreement and
delivered it to the Syndication Agent.
9. No Defenses. The Company hereby acknowledges and agrees that it has
no defenses, offsets or counterclaims with respect to its obligations under the
Credit Agreement, the Notes, the other Basic Documents and the Operative
Documents and hereby waives and releases all claims against the Syndication
Agent and the Lenders with respect thereto.
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10. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the undersigned have caused their duly authorized
representatives to execute and deliver this Agreement as of the day and year
first above written.
CORRECTIONAL SERVICES CORPORATION,
a Delaware corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL, INC.
a Maryland corporation
By:_________________________________
Name:
Title:
FF&E, INC., a New Jersey corporation
By:_________________________________
Name:
Title:
COMMUNITY CORRECTIONS, INC., a
Texas corporation
By:_________________________________
Name:
Title:
(Signatures continued on next page)
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YOUTH SERVICES INTERNATIONAL
OF NORTHERN IOWA, INC., an
Iowa corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF BALTIMORE, INC., a Maryland
corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF VIRGINIA, INC., a Virginia
corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
HOLDINGS, INC., a Delaware corporation
By:_________________________________
Name:
Title:
(Signatures continued on next page)
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YOUTH SERVICES INTERNATIONAL
REAL PROPERTY PARTNERSHIP, LLP,
a Maryland limited liability
partnership
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF DELAWARE, INC., a Delaware
corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF ILLINOIS, INC., a Maryland
corporation
By:________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF MARYLAND, INC., a Maryland
corporation
By:_________________________________
Name:
Title:
(Signatures continued on next page)
8
YOUTH SERVICES INTERNATIONAL
OF MINNESOTA, INC., a Maryland
corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF SOUTH DAKOTA, INC., a South Dakota
corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF TEXAS, INC., a Texas corporation
By:_________________________________
Name:
Title:
YSI OF CENTRAL IOWA, INC.,
an Iowa corporation
By:_________________________________
Name:
Title:
(Signatures continued on next page)
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YOUTH SERVICES INTERNATIONAL
OF IOWA, INC., a Maryland
corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF MICHIGAN, INC., a Michigan
corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF MISSOURI, INC., a Missouri
corporation
By:_________________________________
Name:
Title:
YOUTH SERVICES INTERNATIONAL
OF TENNESSEE, INC., a Maryland
corporation
By:_________________________________
Name:
Title:
(Signatures continued on next page)
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YOUTH SERVICES INTERNATIONAL
SOUTHEASTERN PROGRAMS, INC.,
a Maryland corporation
By:_________________________________
Name:
Title:
CSC MANAGEMENT DE PUERTO RICO, INC.,
a Puerto Rico corporation
By:_________________________________
Name:
Title:
FLEET NATIONAL BANK,
as the Syndication Agent and a Lender
By:_________________________________
Xxxx Xxxxx
Vice President
SUNTRUST BANK, NASHVILLE, N.A.,
as a Lender
By:_________________________________
Name:
Title:
BANCO POPULAR NORTH AMERICA
By:_________________________________
Name:
Title:
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