AMENDMENT NO. 12
Dated as of January 22, 1996
to
RESTATED AND AMENDED CREDIT AGREEMENT
Dated as of July 27, 1992
This Amendment No. 12 ("Amendment") dated as of January
22, 1996 is entered into among RHI Holdings, Inc., a
Delaware corporation ("RHI"), Fairchild Industries, Inc., a
Delaware corporation ("FII"), VSI Corporation, a Delaware
corporation ("VSI"), and the "Senior Lenders" (as defined in
the Credit Agreement identified below) of VSI, FII and RHI
signatory hereto. Capitalized terms used herein without
definition are used herein as defined in the Credit
Agreement.
PRELIMINARY STATEMENT:
RHI, VSI, and FII as Borrowers, certain financial
institutions as Senior Lenders, the Agents, and the
Administrative Agent are parties to that certain Restated
and Amended Credit Agreement dated as of July 27, 1992, as
amended (the "Credit Agreement").
VSI has notified the Administrative Agent and Senior
Lenders of its intention to sell substantially all of its
assets relating to its D-M-E Division (subject to certain
liabilities) to Cincinnati Milacron Inc. and certain of its
Affiliates.
RHI has requested an extension of the Facility
Termination Date for Facility A under the Credit Agreement.
Subject to the terms and conditions stated herein, RHI,
VSI and the Senior Lenders of RHI, FII and VSI signatory
hereto have agreed to further amend the Credit Agreement as
set forth in Section 1.
SECTION 1. Amendments to the Credit Agreement.
Effective as of January 22, 1996, subject to the
satisfaction of the conditions precedent set forth in
Section 2 hereof, the Credit Agreement is hereby amended as
follows:
1.1 Section 1.01 is amended to delete the definition
of "Facility Termination Date" in its entirety and
substitute the following therefor:
"Facility Termination Date" shall mean, (i) with
respect to Facility A, , February 28, 1997 and (ii) with
respect to Facility G, the earlier to occur of (a) the date
on which FII merges with and into Shared Technologies, Inc.
and (b) March 31, 1997.
1.2 Section 3.04 is amended to (i) add the following
provision at the end of clause (a) thereof:
Notwithstanding the foregoing or anything contained in
the Series VII Term Notes to the contrary, in the event FII
merges with and into Shared Technologies, Inc., the then
unpaid principal balance of the Series VII Term Notes,
together with all accrued and unpaid interest thereon and
costs and expenses associated therewith, shall become
immediately due and payable upon such merger becoming
effective, without notice or demand.
and (ii) add the following provision at the end of clause
(b) thereof:
Notwithstanding the foregoing or anything contained in
the Series VIII Term Notes to the contrary, in the event FII
merges with and into Shared Technologies, Inc., the then
unpaid principal balance of the Series VIII Term Notes,
together with all accrued and unpaid interest thereon and
costs and expenses associated therewith, shall become
immediately due and payable upon such merger becoming
effective, without notice or demand.
1.3 Section 11.03A is amended to (i) delete the
provisions of clause (a) thereof in their entirety and
substitute the following therefor:
(a) Investments of VSI or any such Subsidiary of VSI
in Cash Equivalents; provided that the aggregate amount of
Cash and Cash Equivalents of VSI and its Subsidiaries shall
not exceed (i) $8,000,000 plus, (ii) for a period of three
(3) Business Days after receipt thereof, cash proceeds of
sale of Excluded Dispositions, plus (iii) $11,000,000 of the
proceeds of sale of assets of VSI's D-M-E Division permitted
by the Requisite Senior Lenders of VSI to be retained by VSI
in Europe which are held on deposit with a Senior Lender of
VSI;
and (ii) delete the provisions of clause (d) thereof in
their entirety and substitute the following therefor:
(d) Investments of VSI or any such Subsidiary which
represent defaulted or extended obligations previously
contracted in the ordinary course of business and payable on
terms necessary to effectuate the collection thereof, in an
amount not to exceed at any one time outstanding (in the
aggregate for VSI and all of its Subsidiaries) $600,000,
which amount shall not include the amount of receivables
required to be repurchased under the Cincinnati Milacron
Inc. Asset Purchase Agreement; provided that the amount of
such Investments by VSI in any one obligor (other than the
obligors on receivables repurchased under the Cincinnati
Milacron Asset Purchase Agreement to the extent of such
repurchased receivables) shall not exceed $250,000 in the
aggregate at any one time outstanding;
1.4 Section 12.01 is amended to add the following
provision at the end thereof:
For purposes of this Section 12.01, the term
"Consolidated Current Assets" shall include, without
limitation, Indebtedness of Cincinnati Milacron Inc.
evidenced by two certain promissory notes executed and
delivered by Cincinnati Milacron Inc. under the Cincinnati
Milacron Inc. Asset Purchase Agreement and payable to VSI
(the "CM Notes").
1.5 Section 12.06 is amended to add the following
provision at the end thereof:
For purposes of this Section 12.06, the term "Accounts"
shall include, without limitation, Indebtedness of
Cincinnati Milacron Inc. evidenced by the CM Notes.
1.6 Section 12.07 is amended to delete that portion of
the schedule of covenant test dates and amounts commencing
with the Third Quarter, 1996 and ending with the Fourth
Quarter, 1996 in its entirety and substitute the following
therefor:
Third Quarter, 1996 58,500,000
Fourth Quarter, 1996 62,600,000
1.7 VSI hereby covenants that (i) VSI shall exercise,
on the first date permitted under the terms of the
promissory notes executed and delivered to VSI by Cincinnati
Milacron Inc. in connection with the sale of assets of VSI's
D-M-E Division to Cincinnati Milacron Inc. (the "CM Notes"),
its right to demand payment of the Indebtedness evidenced by
the CM Notes and such demand shall be for payment of such
Indebtedness by no later than the 30th day after the date of
such notice of demand; and (ii) VSI shall exercise, no later
than the date on which payment becomes due under the
aforesaid notice, its right to draw on the letter of credit
naming VSI as beneficiary delivered to VSI in connection
with such sale by VSI of its D-M-E Division assets. Any
modification or amendment of the foregoing covenant of VSI,
or any waiver of an Event of Default occurring due to VSI's
failure to comply with such covenant, shall not be effective
unless agreed in writing by all Senior Lenders of VSI.
SECTION 2. Conditions Precedent to Effectiveness of
this Amendment.
2.1 The amendments set forth in Sections 1.1 and 1.2
of this Amendment shall become effective as of January 22,
1996 if, and only if, the Administrative Agent shall have
received on or before January 22, 1996 a facsimile or
original executed copy of this Amendment executed by RHI,
FII, VSI and all Senior Lenders of RHI, FII and VSI.
2.2 The amendments set forth in Sections 1.3 through
1.7 of this Amendment shall become effective as of January
22, 1996 if, and only if, (i) the Administrative Agent shall
have received on or before January 22, 1996 (a) a facsimile
or original executed copy of this Amendment executed by VSI
and the Requisite Senior Lenders of VSI, (b) executed
counterparts of that certain consent letter dated as of
January 22, 1996, a copy of which is attached hereto as
Exhibit A and made a part hereof (the "Consent"), signed by
the Requisite Senior Lenders of FII and VSI, and (c) payment
of the fee described in condition (c) of the Consent and
(ii) the sales of the assets of the D-M-E Division of VSI
referenced in the premises to this Amendment and
contemplated by the Consent are consummated on the terms
heretofore disclosed to the Administrative Agent.
SECTION 3. Representations and Warranties. RHI, FII
and VSI hereby represent and warrant as follows:
3.1 This Amendment and the Credit Agreement as
previously executed and amended and as amended hereby
constitute legal, valid and binding obligations of RHI, FII
and VSI and are enforceable against RHI, FII and VSI in
accordance with their terms.
3.2 No Event of Default or Potential Event of Default
exists or would result from any of the transactions
contemplated by this Amendment.
3.3 Upon the effectiveness of this Amendment, RHI, FII
and VSI hereby reaffirm all covenants, representations and
warranties made by them, respectively, in the Credit
Agreement to the extent the same are not amended hereby and
agree that all such covenants, representations and
warranties shall be deemed to have been remade as of the
date this Amendment becomes effective
(unless a representation and warranty is stated to be given
on and as of a specific date, in which case such
representation and warranty shall be true, correct and
complete as of such date).
SECTION 4. Reference to and Effect on the Credit
Agreement.
4.1 Upon the effectiveness of this Amendment, each
reference in the Credit Agreement to "this Agreement",
"hereunder", "hereof", "herein" or words of like import
shall mean and be a reference to the Credit Agreement, as
amended hereby, and each reference to the Credit Agreement
in any other document, instrument or agreement executed
and/or delivered in connection with the Credit Agreement
shall mean and be a reference to the Credit Agreement as
amended hereby.
4.2 Except as specifically amended above, the Credit
Agreement, the Notes and all other Loan Documents shall
remain in full force and effect and are hereby ratified and
confirmed.
4.3 The execution, delivery and effectiveness of this
Amendment shall not operate as a waiver of any right, power
or remedy of any Senior Lender or Agent or the
Administrative Agent under the Credit Agreement, the Notes
or any of the other Loan Documents, nor constitute a waiver
of any provision contained therein, except as specifically
set forth herein.
SECTION 5. Execution in 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 to be
an original and all of which taken together shall constitute
but one and the same instrument. Delivery of an executed
counterpart of this Amendment by telecopier shall be
effective as delivery of a manually executed counterpart of
this Amendment.
SECTION 6. Governing Law. This Amendment shall be
governed by and construed in accordance with the laws of the
State of New York.
SECTION 7. 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.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers
thereunto duly authorized as of the date first above
written.
VSI CORPORATION RHI HOLDINGS, INC.
By: Karen L. Schneckenburger By: Karen L.
Schneckenburger
Title: Treasurer Title: Treasurer
FAIRCHILD INDUSTRIES, INC.
By: Karen L. Schneckenburger
Title: Treasurer
CITICORP NORTH AMERICA, INC. THE BANK OF NOVA SCOTIA
By: Colin M. Cohen By: F.C.H. Ashby
Title: Managing Director Title: Sr.Mgr.Loan
Operation
CANADIAN IMPERIAL BANK OF CAISSE NATIONALE DE
CREDIT
COMMERCE AGRICOLE
By: Mary Kate Miller By: David Bouhl, F.V.P.
Title: Authorized Signatory Title: Head of Corp.
Banking
Chicago
NATIONSBANK, N.A. WELLS FARGO BANK, N.A.
By: John D. Mindich By: Lomora J. Sjpradley
Title: Senior Vice President Title: Vice President
GENERALE BANK NEW YORK THE MITSUBISHI BANK,
LIMITED
By: E. Matthews By: Noboru Kobayashi
Title: Senior Vice President Title: Joint General
Manager
THE LONG-TERM CREDIT BANK OF UNION BANK
JAPAN, LTD.
By: Brody S. Sadik By: Kristine A.
Kasselman
Title: VP & Deputy General Mgr. Title: Vice President
PILGRIM PRIME RATE TRUST SENIOR DEBT PORTFOLIO
By: Howard Tiffen By: Boston Mgt.&
Research
Title: Senior Vice President as Investment Adisor
EXHIBIT A
to Consent and Amendment No. 12
Dated as of January 22, 1996
FORM OF CONSENT
Attached