FIRST AMENDMENT TO AMENDED AND RESTATED
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REVOLVING CREDIT AGREEMENT
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NEW ENGLAND BUSINESS SERVICE, INC.
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FIRST AMENDMENT TO AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT dated
as of May 29, 1998 (this "Amendment"), by and among NEW ENGLAND BUSINESS
SERVICE, INC. (the "Borrower"), a Delaware corporation having its principal
place of business at 500 Main Street, Groton, Massachusetts 01471, and the
Subsidiaries of the Borrower listed on the signature pages hereto (the
"Guarantors"), BANKBOSTON, N.A., a national banking association ("BKB"), and
the other lending institutions listed on Schedule 1 to the Credit Agreement
referred to below (together with BKB, the "Banks"), BANKBOSTON, N.A., as
agent for itself and such other lending institutions (the "Agent"), and FLEET
NATIONAL BANK, as documentation agent for itself and such other lending
institutions.
WHEREAS, the Borrower, the Banks and the Agent are parties to an Amended
and Restated Revolving Credit Agreement, dated as of December 18, 1997 (as
amended and in effect from time to time, the "Credit Agreement," capitalized
terms defined therein having the same meanings herein as therein), pursuant
to which the Banks have extended credit to the Borrower on the terms and
subject to the conditions set forth therein;
WHEREAS, subject to the terms and conditions set forth herein, the
Borrower, the Banks, and the Agent have agreed to amend the Credit Agreement
as set forth herein;
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree to amend the Credit Agreement as follows:
1. Amendments to Definitions. Section 1.1 of the Credit Agreement
is hereby amended by:
(a) adding the following new definitions to Section 1.1 of the Credit
Agreement in the proper alphabetical order:
"First Amendment Effective Date. The "Effective Date", as defined
in the First Amendment to Amended and Restated Revolving Credit
Agreement, dated as of May 29, 1998 among the Borrower, the Agent, the
Documentation Agent, the Banks, and the Subsidiaries of the Borrower
listed on the signature pages thereto.
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McBee. McBee Systems, Inc., a Colorado corporation.
McBee Acquisition. The acquisition by the Borrower (or an
affiliate of the Borrower) of one hundred percent (100%) of the capital
stock of McBee and its Subsidiaries and the acquisition of certain
assets from McBee Canada on the terms and conditions set forth below:
(i) the closing of the McBee Acquisition shall occur on or
before, but not after, June 30, 1998;
(ii) the terms and conditions of the McBee Acquisition shall be
substantially those set forth in the McBee Asset Purchase Agreement and
the McBee Stock Purchase Agreement. Without limiting the generality of
the foregoing, (A) the Initial Cash Payment (as defined in the McBee
Asset Purchase Agreement ) shall not exceed $5,000,000, (B) the Initial
Purchase Price (as defined in the McBee Stock Purchase Agreement) shall
not exceed $58,000,000, (C) neither McBee nor any of its Subsidiaries
shall have, nor shall the Borrower have assumed, any Indebtedness for
borrowed money, debt or other similar monetary obligations, including
guaranties of the obligations of others (with the guaranty obligations
of McBee and McBee Canada in respect of the ROMO Corp. Loan Agreement
being released in their entirety and all obligations of McBee to ROMO
Corp. being cancelled or repaid in full prior to the consummation of the
McBee Acquisition) in excess of $250,000 in the aggregate, and (D) the
Borrower shall have acquired one hundred percent (100%) of the capital
stock of McBee and any of its Subsidiaries;
(iii) there shall be no material misstatements in or omissions
from the materials furnished to the Agent, the Banks and the Arranger
for their review in connection with the McBee Acquisition;
(iv) upon consummation of the McBee Acquisition, the stock and
assets of McBee and McBee Canada, respectively, and each of their
Subsidiaries shall be free and clear of any and all liens and
encumbrances, except for Permitted Liens;
(v) promptly following the consummation of the McBee
Acquisition, the Borrower shall deliver to the Agent and the Banks
revisions to the disclosure schedules attached to this Credit Agreement
and the other Loan Documents, and an updated certificate of locations of
the Borrower and its Subsidiaries, in each case reflecting solely the
materials disclosed by the McBee Asset Purchase Agreement and the McBee
Stock Purchase Agreement, provided, however, that the Borrower shall not
seek to revise (A) Schedule 5.18 to the Credit Agreement so as to
disclose any item which might adversely affect the properties, assets,
financial condition or business of the Borrower or its Subsidiaries or
(B) Schedules 7.1, 7.2 or 7.3 to the Credit Agreement; and
(vi) all parties to the McBee Asset Purchase Agreement and the
McBee Stock Purchase Agreement shall have received all necessary third
party consents and approvals.
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McBee Asset Purchase Agreement. The Asset Purchase Agreement
between the Borrower, NEBS Business Forms, McBee Canada and ROMO Corp.,
dated as of May 1, 1998, as in effect on the First Amendment Effective
Date.
McBee Canada. McBee Systems of Canada, Inc., an Ontario
corporation.
McBee Stock Purchase Agreement. The Stock Purchase Agreement
between the Borrower and ROMO Corp., dated as of May 1, 1998, as in
effect on the First Amendment Effective Date.
NEBS Business Forms. NEBS Business Forms Ltd., an Ontario
corporation.
ROMO Corp. ROMO Corp., a Colorado corporation.
ROMO Corp. Loan Agreement. The Loan Agreement dated March 17, 1993
between ROMO Corp. and US Bank, f/k/a/ Colorado National Bank."
(b) deleting the introductory paragraph of the definition of Permitted
Acquisition in its entirety and replacing it with the following new
introductory paragraph:
"Permitted Acquisition. The Rapidforms Acquisition, the McBee
Acquisition or any other acquisition of any Person, business, division,
or specified group of assets by the Borrower or any of its Subsidiaries,
provided that, with respect to any other such acquisition, (1) the Agent
and the Majority Banks approve, in their sole discretion, such
acquisition in writing in advance or (2) each of the following
conditions is met:"
(c) deleting the definition of Total Commitment in its entirety and
replacing it with the following new definition:
"Total Commitment. The sum of the Commitments of the Banks, as in
effect from time to time, which amount shall, as of the First Amendment
Effective Date, be $165,000,000."
2. Amendment to Section 2.5.1 of the Credit Agreement. Subsection
2.5.1 of the Credit Agreement is hereby amended by deleting the first
sentence thereof in its entirety and by replacing it with the following
sentence:
"2.5.1. Syndicated Notes. The Syndicated Loans shall be evidenced
by separate promissory notes of the Borrower in substantially the form
of Exhibit F-1 attached hereto (each a "Syndicated Note"), dated as of
the Closing Date or, as the case may be, the First Amendment Effective
Date and completed with appropriate insertions."
3. Amendment to Section 5 of the Credit Agreement. Section 5 of the
Credit Agreement is hereby amended by adding the following new sections at
the end thereof:
"5.24. McBee Acquisition. Upon the closing (if any) of the McBee
Acquisition, each of the representations and warranties made by the Borrower
and, to the best of the
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Borrower's knowledge, ROMO Corp. contained in the McBee Asset Purchase
Agreement or the McBee Stock Purchase Agreement shall have been true and
correct in all material respects when made and shall continue to be true and
correct in all material respects on the date of such closing, except to the
extent that any of such representations and warranties relate, by the express
terms thereof, solely to a date falling prior to the date of such closing,
and except to the extent that any of such representations and warranties may
have been affected by the consummation of the transactions contemplated and
permitted or required by the McBee Asset Purchase Agreement or the McBee
Stock Purchase Agreement.
5.25. Year 2000 Problem. The Borrower and its Subsidiaries have
reviewed the areas within their businesses and operations which could be
adversely affected by, and have developed or are developing a program to
address on a timely basis, the "Year 2000 Problem" (i.e. the risk that
computer applications used by either the Borrower or any of its Subsidiaries
may be unable to recognize and perform properly date-sensitive functions
involving certain dates prior to and any date after December 31, 1999).
Based upon such review, the Borrower reasonably believes that the "Year 2000
Problem" will not have any materially adverse effect on the business or
financial condition of the Borrower and its Subsidiaries taken as a whole."
4. Addition of Section 6.15 to the Credit Agreement. Section 6 of the
Credit Agreement is hereby amended by adding the following new Section 6.15
at the end thereof:
"6.15. McBee Acquisition.
6.15.1. McBee Guaranty, etc. Promptly following the consummation
of the McBee Acquisition, the Borrower shall (a) cause McBee and each of
its Subsidiaries to execute and deliver to the Agent a Guaranty, in the
form of Exhibit A hereto, of the Obligations under this Credit Agreement
and the other Loan Documents, together with such evidence of corporate
authorization, other corporate documentation and legal opinions
(including, where applicable, local counsel opinions of Colorado or
other local counsel) as the Agent may reasonably request, (b) deliver to
the Agent evidence satisfactory to the Agent, of the release of: (i)
all guaranty obligations under the ROMO Corp. Loan Agreement, and
(ii) all security interests and liens securing such guaranty
obligations, pursuant to UCC-3 termination statements and other
appropriate release or termination documents; and (c) deliver to the
Agent evidence satisfactory to the Agent of the repayment and release of
all obligations of McBee to ROMO Corp. and of any and all security
interests and liens securing such obligations, pursuant to UCC-3
termination statements and other appropriate release or termination
documents. Within 30 days following the First Amendment Effective Date,
the Borrower shall deliver to the Agent evidence satisfactory to the
Agent of the termination of (x) the security interest of First City,
Texas - Houston, N.A. against McBee Canada, as evidenced by financing
statement 900931338 filed June 7, 1989 with the Ministry of Consumer and
Commercial Relations, Province of Ontario, Canada, and (y) to the extent
not otherwise permitted by Section 7.2, any other financing statements
revealed by Uniform Commercial Code or Personal Property Security Act of
Canada searches conducted against McBee or McBee Canada at the request
of the Agent.
6.15.2. Closing Balance Sheet. The Borrower shall deliver to the
Agent and the Banks, promptly upon receipt thereof from McBee and McBee
Canada, the Closing Balance Sheet (as defined in the McBee Stock
Purchase Agreement)."
5. Amendment to Section 7.1 of the Credit Agreement. Section 7.1
of the Credit Agreement is hereby amended by deleting paragraph (m) in its
entirety and by replacing it with the following paragraph (m):
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"(m) Indebtedness for borrowed money, debt or similar monetary
obligations assumed in respect of Permitted Acquisitions (other than the
Rapidforms Acquisition or the McBee Acquisition), to the extent
permitted by paragraph 2(b) of the definition thereof, and other
Indebtedness assumed in respect of Permitted Acquisitions (other than
the Rapidforms Acquisition) and existing prior to the date of any
Permitted Acquisition and not created in contemplation thereof;"
6. Amendment to Section 7.3 of the Credit Agreement. Section 7.3 of
the Credit Agreement is hereby amended by deleting paragraph (k) in its
entirety and by replacing it with the following paragraph (k):
"(k) Investments in respect of (i) Permitted Acquisitions (other than
the Rapidforms Acquisition or the McBee Acquisition) to the extent permitted
by the definition thereof; (ii) the Rapidforms Acquisition to the extent
permitted by the definition thereof and Section 7.1(n); and (iii) the McBee
Acquisition to the extent permitted by the definition thereof and Section
7.1(m);"
7. Replacement of Schedule 1 to the Credit Agreement. Schedule 1 of
the Credit Agreement is hereby deleted in its entirety, and Schedule 1
attached hereto is hereby substituted in lieu thereof.
8. Representations and Warranties. The Borrower and each of the
Guarantors hereby represents and warrants to the Agent and the Banks as of
the date hereof, and as of any date on which the conditions set forth in
Section 9 below are met, as follows:
(a) The execution and delivery by each of the Borrower and the
Guarantors of this Amendment and all other instruments and agreements
required to be executed and delivered by the Borrower or any of the
Guarantors in connection with the transactions contemplated hereby or
referred to herein (collectively, the "Amendment Documents"), and the
performance by each of the Borrower and the Guarantors of any of their
obligations and agreements under the Amendment Documents and the Credit
Agreement and other Loan Documents, as amended hereby, are within the
corporate authority of each of the Borrower and the Guarantors, have
been authorized by all necessary corporate proceedings on behalf of each
of the Borrower and the Guarantors, and do not and will not contravene
any provision of law or any of the Borrower's charter or any of the
Guarantors' charter, other incorporation papers, by-laws or any stock
provision or any amendment thereof or of any indenture, agreement,
instrument or undertaking binding upon the Borrower or any of the
Guarantors.
(b) Each of the Amendment Documents and the Credit Agreement and
other Loan Documents, as amended hereby, to which the Borrower or any of
the Guarantors is a party constitute legal, valid and binding
obligations of such Person, enforceable in accordance with their terms,
except as limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or affecting generally the enforcement of
creditors' rights.
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(c) No approval or consent of, or filing with, any governmental
agency or authority is required to make valid and legally binding the
execution, delivery or performance by the Borrower or any of the
Guarantors of the Amendment Documents or the Credit Agreement or other
Loan Documents, as amended hereby, or the consummation by the Borrower
or any of the Guarantors of the transactions among the parties
contemplated hereby and thereby or referred to herein.
(d) The representations and warranties contained in Section 5 of
the Credit Agreement and in the other Loan Documents were correct at and
as of the date made. Except to the extent of changes resulting from
transactions contemplated or permitted by the Credit Agreement and the
other Loan Documents, changes occurring in the ordinary course of
business (which changes, either singly or in the aggregate, have not
been materially adverse) and to the extent that such representations and
warranties relate expressly to an earlier date and after giving effect
to the provisions hereof, such representations and warranties, after
giving effect to this Amendment and the other Amendment Documents, also
are correct at and as of the date hereof and will be correct as of the
date of the closing of the McBee Asset Purchase Agreement and the McBee
Stock Purchase Agreement.
(e) Each of the Borrower and the Guarantors has performed and
complied in all material respects with all terms and conditions herein
required to be performed or complied with by it prior to or at the time
hereof (including, updating all disclosure required on each of the
schedules), and as of the date hereof, after giving effect to the
provisions of this Amendment and the other Amendment Documents, there
exists no Event of Default or Default.
(f) Each of the Borrower and the Guarantors acknowledges and
agrees that the representations and warranties contained in this
Amendment shall constitute representations and warranties referred to in
Section 11.1(e) of the Credit Agreement, a breach of which shall
constitute an Event of Default.
9. Effectiveness. This Amendment shall become effective upon the
satisfaction of each of the following conditions (the "Effective Date"), in
each case in a manner satisfactory in form and substance to the Agent and the
Banks:
(a) This Amendment shall have been duly executed and delivered by
each of the parties hereto;
(b) The Borrower shall have executed and delivered to the Agent an
amended and restated Revolving Credit Note in favor of each Bank which agrees
to increase its Commitment hereunder, in a principal amount equal to such
Bank's Commitment as allocated by the Agent hereunder, substantially in the
form of Exhibit F-1 to the Credit Agreement (the "Replacement Notes");
(c) The Agent shall have received from the Secretary of each of the
Borrower and the Guarantors a copy, certified by such Secretary to be true
and complete as of the date hereof, of
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each of (A) its charter or other incorporation documents as in effect on such
date of certification, (B) its by-laws as in effect on such date, and (C) the
resolutions of its Board of Directors authorizing, to the extent it is a
party thereto, the execution, delivery and performance of this Amendment, the
Replacement Notes and any other Amendment Documents;
(d) The Agent shall have received from the Borrower copies of the
most recent audited combined financial statements of McBee Systems, Inc., a
Colorado corporation ("McBee"), and McBee Systems of Canada, Inc., an Ontario
corporation ("McBee Canada");
(e) The Agent shall have received from the Borrower a compliance
certificate evidencing pro forma compliance with the requirements of Section
8 (as amended hereby) of the Credit Agreement in the form of Exhibit G to the
Credit Agreement, duly certified by the principal financial or accounting
officer of the Borrower, indicating the Borrower's compliance with the
financial covenants set forth in Section 8 of the Credit Agreement,
immediately prior to and following the consummation of the McBee Acquisition
(as defined in the Credit Agreement as amended hereby);
(f) The Agent shall have received from each of the Borrower and the
Guarantors an incumbency certificate, dated as of the date hereof, signed by
a duly authorized officer of the Borrower or the Guarantor, as the case may
be, and giving the name and bearing a specimen signature of each individual
who shall be authorized to sign, in the name and on behalf of the Borrower or
the Guarantor, as the case may be, the Amendment Documents;
(g) The Agent shall have received from the Borrower: (i) a completed
and fully executed certificate of locations for each of McBee and McBee
Canada, (ii) the results of UCC searches of McBee, and (iii) Personal
Property Security Act of Canada searches (PPSA searches) of McBee Canada,
indicating no liens other than Permitted Liens and otherwise in form and
substance satisfactory to the Agent;
(h) The Agent shall have received from the Borrower good standing
certificates for each of the Borrower and the Guarantors, issued by the
Secretary of State of each such entity's jurisdiction of incorporation and of
each jurisdiction in which such entity has qualified to do business;
(i) The Agent shall have received from the Borrower copies of each
of the McBee Asset Purchase Agreement (as defined in the Credit Agreement as
amended hereby) and the McBee Stock Purchase Agreement (as defined in the
Credit Agreement as amended hereby), together with the certification of a
duly authorized officer of the Borrower that such copies are true, correct
and complete and have not been amended, modified, rescinded, revoked or
supplemented; and
(j) The Agent shall have received a favorable legal opinion
addressed to the Agent and the Banks, dated as of the date hereof, in form
and substance satisfactory to the Agent, from Hill and Barlow with respect to
the Borrower and each Guarantor; provided, however, that such opinion may
assume the due incorporation, good standing and the due authorization,
execution and delivery of the Amendment Documents by Rapidforms and Newshire
Forms, Inc.
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10. Miscellaneous Provisions.
(a) Each of the Borrower and the Guarantors hereby ratifies and
confirms all of its Obligations to the Agent and the Banks under the Credit
Agreement, as amended hereby, and the other Loan Documents, including,
without limitation, the Loans and the reimbursement obligations, and each of
the Borrower and the Guarantors hereby affirms its absolute and unconditional
promise to pay to the Banks and the Agent the Loans, reimbursement
obligations and all other amounts due or to become due and payable to the
Banks and the Agent under the Credit Agreement and the other Loan Documents,
as amended hereby. Except as expressly amended hereby, each of the Credit
Agreement and the other Loan Documents shall continue in full force and
effect. This Amendment and the Credit Agreement shall hereafter be read and
construed together as a single document, and all references in the Credit
Agreement, any other Loan Document or any agreement or instrument related to
the Credit Agreement shall hereafter refer to the Credit Agreement as amended
by this Amendment.
(b) THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS (WITHOUT REFERENCE TO
CONFLICT OF LAWS) AND SHALL TAKE EFFECT AS A SEALED INSTRUMENT IN ACCORDANCE
WITH SUCH LAWS.
(c) This Amendment may be executed in any number of counterparts, and
all such counterparts shall together constitute but one instrument. In
making proof of this Amendment it shall not be necessary to produce or
account for more than one counterpart signed by each party hereto by and
against which enforcement hereof is sought.
[Signature Pages Follow]
IN WITNESS WHEREOF, intending to be legally bound, each of the
undersigned has caused this Amendment to be executed on its behalf by its
officer thereunto duly authorized, as of the date first above written.
New England Business Service, Inc.
By:/s/ John F. Fairbanks
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Name: John F. Fairbanks
Title: Vice President, CFO and
Treasurer
BANKBOSTON, N.A.,
individually and as Agent
By:/s/ Harvey H. Thayer, Jr.
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Name: Harvey H. Thayer, Jr.
Title: Director
FLEET NATIONAL BANK,
individually and as Documentation Agent
By:/s/ Thomas F. Brennan
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Name: Thomas F. Brennan
Title: Vice President
FIRST UNION NATIONAL BANK, N.A.,
successor to CoreStates Bank, N.A.
By:/s/ Jon R. Sundstrom
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Name: Jon R. Sundstrom
Title: Vice President
KEY BANK N.A.
By:/s/ Noel B. Graydon
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Name: Noel B. Graydon
Title: Vice President
USTRUST
By:/s/ Brian C. Roche
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Name: Brian C. Roche
Title: Vice President
SUNTRUST BANK, ATLANTA
By:/s/ W. David Wisdom
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Name: W. David Wisdom
Title: Group Vice President
SUNTRUST BANK, ATLANTA
By:/s/ Karen Copeland
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Name: Karen Copeland
Title: Assistant Vice President
THE BANK OF NOVA SCOTIA
By:/s/ T.M. Pirher
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Name: T.M. Pirher
Title: Authorized Signatory
WACHOVIA BANK, N.A.
By:/s/ Jeffrey S. Nurkiewicz
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Name: Jeffrey S. Nurkiewicz
Title: Vice President
KREDIETBANK N.V.
By:/s/ Robert M. Surdam, Jr.
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Name: Robert M. Surdam, Jr.
Title: Vice President
KREDIETBANK N.V.
By:/s/ Robert Snauffer
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Name: Robert Snauffer
Title: Vice President
SUMMIT BANK
By:/s/ Christopher J. Annas
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Name: Christopher J. Annas
Title: Regional Vice President
Signature page
to the First Amendment
The undersigned hereby acknowledges the foregoing First Amendment as of
the Effective Date, agrees to the provisions of Sections 8 and 10 hereof, and
agrees that its obligations under the Guaranty will extend to the Credit
Agreement, as so amended, and the other Loan Documents.
RAPIDFORMS, INC.
By:/s/ John F. Fairbanks
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Name: John F. Fairbanks
Title: Assistant Treasurer
RUSSELL & MILLER, INC.
By:/s/ John F. Fairbanks
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Name: John F. Fairbanks
Title: Assistant Treasurer
NEWSHIRE FORMS, INC.
By:/s/ John F. Fairbanks
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Name: John F. Fairbanks
Title: Assistant Treasurer
RAPDEL, INC.
By:/s/ John F. Fairbanks
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Name: John F. Fairbanks
Title: Assistant Treasurer
NEBS INTERACTIVE, INC.
By:/s/ John F. Fairbanks
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Name: John F. Fairbanks
Title: Vice President