FIRST AMENDMENT TO
CREDIT AGREEMENT
This Amendment is agreed to as of the 27th day of June, 1997, by and
among BMC Industries, Inc., a Minnesota corporation (the "Borrower"); Norwest
Bank Minnesota, National Association, a national banking association, as Agent
under the Credit Agreement described below (in such capacity, the "Agent"); and
Norwest Bank Minnesota, National Association, a national banking association,
First Bank National Association, a national banking association, and NBD Bank,
a Michigan banking corporation, as Banks (the "Banks").
The Borrower, the Agent and the Banks are each parties to a Credit
Agreement dated as of June 5, 1996 (together with all amendments,
modifications and restatements thereof, the "Credit Agreement").
The Borrower has requested an extension of the Facility B Commitment
Termination Date, as defined in the Credit Agreement, and has requested
certain other changes to the Credit Agreement. The Agent and the Banks are
willing to grant the Borrower's request on the terms and subject to the
conditions set forth herein.
ACCORDINGLY, in consideration of the mutual covenants contained in
the Credit Agreement and herein, the parties hereby agree as follows:
1. DEFINITIONS. All terms defined in the Credit Agreement that are
not otherwise defined herein shall have the meanings given them in the Credit
Agreement.
2. AMENDMENT. The Credit Agreement is hereby amended as follows:
(a) The phrase, "(which term shall, with respect to the Borrower and
Vision-Ease, include but not be limited to obligations of the Borrower and
Vision-Ease under the Polycore Agreement so long as it remains in the form
of a take-or-pay contract)", is hereby inserted after the phrase,
"take-or-pay contract", in the definition of "Contingent Obligation", in
Section 1.1 of the Credit Agreement.
(b) The date, "June 15, 2000", in the definition of "Facility A
Commitment Termination Date" in Section 1.1 of the Credit Agreement is
hereby deleted, and the date, "June 15, 2001", is substituted therefor.
(c) The date, "June 4, 1997", in the definition of "Facility B
Commitment Termination Date" in Section 1.1 of the Credit Agreement is
hereby deleted, and the date, "June 26, 1998", is substituted therefor.
Page 12
(d) The following definitions are hereby inserted in Section 1.1 of
the Credit Agreement:
"Polycore" means Polycore Optical, PTE. Ltd.
"Polycore Agreement" means the Product Manufacturing and
Sales Agreement between Vision-Ease and Polycore, setting forth
the obligation of Vision-Ease to purchase plastic lenses from
Polycore during the period through June 2001.
(e) The table in Section 5.8 is hereby amended in its entirety to
read as follows:
QUARTERS ENDING RATIO
--------------- -----
On or before June 30, 1997 0.60 to 1
July 1, 1997 through December 31, 1997 0.57 to 1
January 1, 1998 through June 30, 1998 0.55 to 1
July 1, 1998 through December 31, 1998 0.53 to 1
January 1, 1999 and thereafter 0.50 to 1
(f) The following new paragraph (h) is hereby inserted in Section 6.2
of the Credit Agreement:
(h) Obligations of Vision-Ease and the Borrower under the
Polycore Agreement, so long as the aggregate amount of such
obligations does not exceed $35,000,000.
(g) Schedules 4.4, 4.7, 4.8, 6.1, 6.2, 6.3 and 6.8 to the Credit
Agreement are hereby deleted, and Schedules 4.4, 4.7, 4.8, 6.1, 6.2, 6.3
and 6.8 attached hereto are respectively substituted therefor.
(h) Exhibit A to the Credit Agreement is hereby deleted, and Exhibit
A hereto is substituted therefor.
(i) Exhibit B to the Credit Agreement is hereby deleted, and Exhibit
B hereto is substituted therefor.
3. Renewal Notes and Replacement Notes. Simultaneously with the
execution of this Amendment, the Borrower shall execute and deliver to the
Agent its promissory notes (i) in the form of Exhibit B hereto (the "Renewal
Notes"), payable to the order of each Bank in the face amount of that Bank's
Facility B Commitment Amount and (ii) in the form of Exhibit A hereto (the
"Replacement Notes"), payable to the order of each Bank in the face amount of
that Bank's Facility A Commitment Amount. Each Bank shall accept (x) that
Bank's Renewal Note in substitution for, but not in payment of, that Bank's
existing Facility B Note and (y) that Bank's Replacement Note in substitution
for, but not in payment of, that Bank's existing Facility A Note. Each
reference in the Credit Agreement to a "Facility B Note" shall hereafter be
deemed to be a reference to the corresponding Renewal Note and each reference
in the Credit Agreement to a "Facility A Note" shall hereafter be deemed to
be a reference to the corresponding Replacement Note.
Page 13
4. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents
and warrants to the Agent and the Banks as follows:
(a) The Borrower has all requisite power and authority, corporate or
otherwise, to execute and deliver this Amendment, the Renewal Notes and the
Replacement Notes, and to perform this Amendment, the Renewal Notes, the
Replacement Notes and the Credit Agreement as amended hereby. This
Amendment, the Renewal Notes and the Replacement Notes have been duly and
validly executed and delivered to the Agent by the Borrower, and this
Amendment, the Renewal Notes, the Replacement Notes and the Credit
Agreement as amended hereby constitute the Borrower's legal, valid and
binding obligations enforceable in accordance with their terms.
(b) The execution, delivery and performance by the Borrower of this
Amendment, the Renewal Notes and the Replacement Notes, and the performance
of the Credit Agreement as amended hereby, have been duly authorized by all
necessary corporate action and do not and will not (i) require any
authorization, consent or approval by any governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign,
(ii) violate the Borrower's articles of incorporation or bylaws or any
provision of any law, rule, regulation or order presently in effect having
applicability to the Borrower, or (iii) result in a breach of or constitute
a default under any indenture or agreement to which the Borrower is a party
or by which the Borrower or its properties may be bound or affected.
(c) All of the representations and warranties contained in Article IV
of the Credit Agreement are correct on and as of the date hereof as though
made on and as of such date, except to the extent that such representations
and warranties relate solely to an earlier date.
5. CONDITIONS. The amendments set forth in paragraph 2 shall be
effective only if the Agent has received (or waived the receipt of) each of the
following, in form and substance satisfactory to the Agent and the Banks, on or
before the date hereof (or such later date as the Banks may agree to in
writing):
(a) This Amendment, duly executed by the Borrower and each of the
Guarantors below.
(b) The Renewal Notes and the Replacement Notes, duly executed by the
Borrower.
(c) A copy of the resolutions of the board of directors of the
Borrower evidencing approval of this Amendment, the Credit Agreement as
amended hereby, and the other matters contemplated hereby, certified as
accurate by the secretary of the Borrower.
(d) A certificate of the secretary of the Borrower and the Guarantors
(i) stating that there have been no amendments to or restatements of the
articles of
Page 14
incorporation or bylaws of the Borrower or the Guarantors as furnished to
the Agent in connection with the execution and delivery of the Credit
Agreement other than those that may be attached to the certificate, and
(ii) certifying the names of the officers of the Borrower and the
Guarantors that are authorized to sign the documents to be delivered
pursuant to this Agreement, together with the true signatures of such
officers.
(e) A signed copy of the opinion of counsel for the Borrower, addressed to the
Agent and the Banks, confirming the matters set forth in paragraph 4 hereof
(other than paragraph (c) thereof), and such other matters as the Agent or any
Bank may in its sole discretion request.
BMC INDUSTRIES, INC. NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, AS AGENT
AND AS A BANK
By _______________________________ By _______________________________
Its ___________________________ Its ____________________________
FIRST BANK NATIONAL ASSOCIATION NBD BANK
By ________________________________
Its ____________________________ By ________________________________
Its ____________________________
CONSENT OF GUARANTOR
The undersigned, as a guarantor of all indebtedness of the Borrower to
the Banks under its Guaranty dated June 5, 1996, hereby consents to the
foregoing Amendment and acknowledges that all indebtedness arising under the
Credit Agreement, as amended thereby, shall constitute Indebtedness as defined
in and guarantied under that Guaranty. The foregoing confirmation shall not be
deemed to limit the terms of the Guaranty in any manner. The undersigned
acknowledges that this Consent merely confirms the terms of the Guaranty, and
that no such confirmation is required in connection with this Amendment or any
future amendment to or restatement of the Credit Agreement or any document
executed in connection with the Credit Agreement or this Amendment.
VISION-EASE LENS, INC.
By _______________________________
Its ___________________________
Page 15