EXHIBIT 10.1(b)
FIRST AMENDMENT TO THIRD
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AMENDED AND RESTATED CREDIT AGREEMENT
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THIS FIRST AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT (this
"Amendment") is entered into as of November 27, 2001, by and among CATALINA
LIGHTING, INC., a Florida corporation ("Domestic Borrower"), CATALINA
INTERNATIONAL PLC, a limited company organized under the laws of England and
Wales (Registered in England No. 03949382) ("Holdings Borrower"), and RING
LIMITED (formerly known as Ring PLC), a limited company organized under the laws
of England and Wales (Registered in England No. 29796) ("Sterling Borrower";
Domestic Borrower, Holdings Borrower and Sterling Borrower are collectively
referred to herein as the "Borrowers" and individually as a "Borrower"),
SUNTRUST BANK, a Georgia banking corporation ("SunTrust"), and the other banks
and lending institutions that are signatories to this Amendment (SunTrust and
such other banks and lending institutions, collectively, the "Lenders"), and
SUNTRUST BANK, in its capacities as Administrative Agent for the Lenders (the
"Administrative Agent"), as Domestic Issuing Bank (the "Domestic Issuing Bank"),
as Domestic Swingline Lender (the "Domestic Swingline Lender"), as UK Issuing
Bank (the "UK Issuing Bank"), and as UK Swingline Lender (the "UK Swingline
Lender").
W I T N E S S E T H:
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WHEREAS, the Borrowers, the Lenders, the Administrative Agent, the
Domestic Swingline Lender, Domestic Issuing Bank, the UK Swingline Lender and
the UK Issuing Bank entered into that certain Third Amended and Restated
Revolving Credit and Term Loan Agreement dated as of July 23, 2001 (as amended,
restated, supplemented, or otherwise modified from time to time, the "Credit
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Agreement");
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WHEREAS, the Borrowers, the Lenders, the Administrative Agent, the
Domestic Swingline Lender, the Domestic Issuing Bank, the UK Swingline Lender
and the UK Issuing Bank are amending the Credit Agreement so as to make certain
changes in the terms and conditions of the Credit Agreement as are more fully
set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants and agreements contained herein and other good and valuable
consideration, the receipt and sufficiency whereof are hereby acknowledged, the
Borrowers, the Lenders, the Administrative Agent, the Domestic Swingline Lender,
the Domestic Issuing Bank,, the UK Swingline Lender and the UK Issuing Bank
hereby amend the Credit Agreement as follows:
A. AMENDMENT
1. Unless otherwise specifically defined herein, each term used
herein which is defined in the Credit Agreement shall have the meaning assigned
to such term in the Credit Agreement. Each reference to "hereof", "hereunder",
"herein" and "hereby" and each other similar reference and each reference to
"this Agreement" and each other similar reference contained in the Credit
Agreement shall from and after the date hereof refer to the Credit Agreement as
amended hereby.
2. Amendment to Section 1.01 Definitions. The Credit Agreement is
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hereby amended by replacing the definitions of "Applicable Base Rate Margin,"
"Applicable LIBOR Margin", "Canadian Revolver" and "Warrants" with the following
new definitions:
"Applicable Base Rate Margin" shall mean, for the period commencing
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January 1, 2001 and continuing until such time that the Leverage Ratio reflected
by the annual financial statements required under Section 8.07(a) or the
quarterly financial statements for each Fiscal Quarter required under Section
8.07(b) is less than 3.50:1.00 calculated as of the relevant determination date
for the preceding four fiscal quarter period then ending, 2.00% per annum. If
the Leverage Ratio reflected by the annual financial statements required under
Section 8.07(a) or the
quarterly financial statements for each Fiscal Quarter required under Section
8.07(b) becomes less than 3.50:1.00 calculated as of the relevant determination
date for the preceding four Fiscal Quarter period then ending, then, at such
time, the Applicable Base Rate Margin shall mean the applicable percentage per
annum determined from the chart set forth below:
If the Leverage Ratio is: The Applicable Base Rate Margin For the Loans Is:
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Less than 1.50:1.00 0.75%
Greater than or equal to 1.50:1.00 but less than 2.00:1.00 1.00%
Greater than or equal to 2.00:1.00 but less than 2.50:1.00 1.25%
Greater than or equal to 2.50:1.00 but less than 3.00:1.00 1.50%
Greater than or equal to 3.00:1.00 but less than 3.50:1.00 1.75%
Greater than or equal to 3.50:1.00 2.00%
Each change in the Applicable Base Rate Margin resulting from a change in the
Leverage Ratio shall be effective on the second Business Day immediately
following the date of delivery to the Administrative Agent of the annual
financial statements required under Section 8.07(a) or the quarterly financial
statements for each Fiscal Quarter required under Section 8.07(b), as
applicable, in each case together with the compliance certificate required by
Section 8.07(c), indicating such change. Notwithstanding the foregoing, at any
time during which the Domestic Borrower has failed to deliver such financial
statements and certificates when required by Section 8.07(a), (b), and (c), as
applicable, the Applicable Base Rate Margin shall be 2.00% per annum, which
shall not include any increase in the Applicable Base Rate Margin contemplated
in Section 8.09, until such time as the delinquent financial statements are
delivered, at which time the Applicable Base Rate Margin shall be reset as
provided above; provided, further, if the Domestic Borrower has not authorized
the issuance of additional shares of common stock and reserved for issuance a
sufficient number of authorized but unissued shares of common stock, or other
securities or property for which the Warrants may be exercisable, to permit the
Warrant to be exercised in full by December 31, 2001, the Applicable Base Rate
Margin shall be increased by 0.75% per annum (the "Warrant Interest Increase").
"Applicable LIBOR Margin" shall mean, for the period commencing January 1, 2001
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and continuing until such time that the Leverage Ratio reflected by the annual
financial statements required under Section 8.07(a) or the quarterly financial
statements for each Fiscal Quarter required under Section 8.07(b) is less than
3.50:1:00 calculated as of the relevant determination date for the preceding
four fiscal quarter period then ending, 4.75% per annum. If the Leverage Ratio
reflected by the annual financial statements required under Section 8.07(a) or
the quarterly financial statements for each Fiscal Quarter required under
Section 8.07(b) becomes less than 3.50:1:00 calculated as of the relevant
determination date for the preceding four fiscal quarter period then ending,
then, at such time, the Applicable LIBOR Margin shall mean the applicable
percentage per annum determined from the chart set forth below:
If the Leverage Ratio is: The Applicable Base Rate Margin For the Loans is:
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Less than 1.50:1.00 1.75%
Greater than or equal to 1.50:1.00 but less than 2.00:1.0 2.00%
Greater than or equal to 2.00:1.00 but less than 2.50:1.00 2.25%
Greater than or equal to 2.50:1.00 but less than 3.00:1.00 2.50%
Greater than or equal to 3.00:1.00 but less than 3.50:1.00 2.75%
Greater than or equal to 3.50:1.00 3.00%
Each change in the Applicable LIBOR Margin resulting from a change in the
Leverage Ratio shall be effective on the second Business Day immediately
following the date of delivery to the Administrative Agent of the annual
financial statements required under Section 8.07(a), or the quarterly financial
statements for each Fiscal Quarter required under Section 8.07(b), as
applicable, in each case together with the compliance certificate required by
Section 8.07(c), indicating such change. Notwithstanding the foregoing, at any
time during which the Domestic Borrower has failed to deliver such financial
statements and certificates when required by Section 8.07(a), (b), and (c), as
applicable, the Applicable LIBOR Margin shall be 4.75% per annum, which shall
not include any increase in the Applicable LIBOR Margin contemplated in Section
8.09, until such time as the delinquent financial statements are delivered, at
which time the Applicable LIBOR Margin shall be reset as provided above;
provided, further, if the Domestic Borrower has not authorized the issuance of
additional shares of common stock and reserved for issuance a sufficient number
of authorized but unissued shares of common stock, or other securities or
property for which the Warrants may be exercisable, to permit the Warrant to be
exercised in full by December 31, 2001, the Applicable Base Rate Margin shall be
increased by the Warrant Interest Increase.
"Canadian Revolver" shall mean that certain credit facility by and among
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Congress Financial Corporation (Canada), as Lender, Catalina Lighting Canada
(1992) Inc., as a Borrower and Lumieres Catalina Canada, (1992) Inc., as a
Borrower.
"Warrants" shall mean each of those certain Warrants, dated as of the Closing
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Date, exercisable for 354,136 shares of common stock of the Domestic Borrower
issued to each of the Senior Lenders and the Agent.
3. Amendment to Section 8.07(b). Section 8.07(b) of the Credit Agreement is
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hereby amended by replacing existing Section 8.07(b) with the following new
Section 8.07(b);
(b) Quarterly Financial Statements. As soon as available and in any event
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within 45 days after the end of each Fiscal Quarter that is not the end of a
Fiscal Year, balance sheets of the Consolidated Companies and the Sterling
Borrower as at the end of such Fiscal Quarter presented on a consolidated basis
and the related statements of income, and cash flows of the
Consolidated Companies and the Sterling Borrower for such Fiscal Quarter and for
the portion of the Fiscal Year ended at the end of such Fiscal Quarter,
presented on a consolidated basis setting forth in each case in comparative form
the figures for the corresponding quarter and the corresponding portion of the
Domestic Borrower's and the Sterling Borrower's previous Fiscal Year and,
commencing January 1, 2002, setting forth in comparative form the figures for
the corresponding quarter and the corresponding portion of the Consolidated
Companies' previous Fiscal Year, all in reasonable detail, and certified by the
chief financial officer of the Domestic Borrower that such financial statements
fairly present in all material respects the financial condition of the
Consolidated Companies and the Sterling Borrower as at the end of such Fiscal
Quarter on a consolidated basis, and the results of operations and cash flows of
the Consolidated Companies and the Sterling Borrower for such Fiscal Quarter and
such portion of the Fiscal Year, in accordance with GAAP consistently applied
(subject to normal year-end audit adjustments and the absence of certain
footnotes). In addition, as soon as available and in any event within 40 days
after the end of each month that is not the end of a Fiscal Quarter and within
45 days after the end of each month that is also the end of a Fiscal Quarter,
balance sheets of the Consolidated Companies and the Sterling Borrower as at the
end of such month presented on a consolidated basis and the related statements
of income and cash flows of the Consolidated Companies and the Sterling Borrower
for such month, all in reasonable detail, and certified by the chief financial
officer of the Domestic
Borrower that such financial statements fairly present in all material respects
the financial condition of the Consolidated Companies and the Sterling Borrower
as at the end of such month on a consolidated basis, and the results of
operations and cash flows of the Consolidated Companies and the Sterling
Borrower for such month, in accordance with GAAP consistently applied (subject
to normal year-end audit adjustments and the absence of certain footnotes);
provided, however, that for the month of October, the balance sheets, related
statements of income and retained earnings and cash flows may be presented in a
manner consistent with GAAP and may be presented subject to subsequent GAAP
adjustments as a result of the Consolidated Companies' and the Sterling
Borrower's year end audit; provided further the that upon the completion of the
Consolidated Companies' and the Sterling Borrower's year end audit, the
Consolidated Companies and the Sterling Borrower shall present revised
statements for the month of October reflecting what adjustments, if any, were
made to the balance sheets, related statements of income and retained earnings
and cash flows as a result of the Consolidated Companies' and the Sterling
Borrower's year end audit.
4. Amendment to Section 9.01(b). Section 9.01(b) of the Credit Agreement is
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hereby amended by replacing existing Section 9.01(b) with the following new
section 9.01(b):
(b) Indebtedness existing on the Closing Date and described on Schedule 9.01
and extension and renewals and replacements of any such Indebtedness that do not
increase the outstanding principal amount thereof or shorten the maturity
thereof; provided, however, that at no time shall any Borrower enter into an
agreement to guaranty the obligations under the Canadian Revolver.
5. Amendment to Schedule 9.01. Schedule 9.01 of the Credit Agreement is hereby
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amended by replacing the existing Schedule 9.01 with the new Schedule 9.01
attached hereto as Exhibit A.
6. Representations and Warranties of Borrowers. Borrowers, without limiting
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the representations and warranties provided in the Credit Agreement, represent
and warrant to the Lenders and the Administrative Agent as follows:
(a) The execution, delivery and performance by Borrowers of this Amendment are
within Borrowers' corporate powers, have been duly authorized by all necessary
corporate action (including any necessary shareholder action) and do not and
will not (a) violate any provision of any law, rule or regulation, any judgment,
order or ruling of any court or governmental agency, the articles of
incorporation or bylaws of Borrowers or any indenture, agreement or other
instrument to which Borrowers are a party or by which Borrowers or any of their
properties are bound or (b) be in conflict with, result in a breach of, or
constitute with notice or lapse of time or both a default under any such
indenture, agreement or other instrument.
(b) This Amendment constitutes the legal, valid and binding obligations of
Borrowers, enforceable against Borrowers in accordance with their respective
terms.
(c) No Default or Event of Default has occurred and is continuing as of the
Effective Date.
7. Conditions to Effectiveness. The effectiveness of this Amendment is subject
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to receipt by Administrative Agent of each of duly executed counterparts to the
Canadian Revolver in form and substance satisfactory to the Administrative Agent
and the Required Lenders.
B. MISCELLANEOUS
1. Except as expressly set forth herein, this Amendment shall be deemed not to
waive or modify any provision of the Credit Agreement or the other Credit
Documents, and all terms of the Credit Agreement, as amended hereby, shall be
and shall remain in full force and effect and shall constitute a legal, valid,
binding and enforceable obligations of the Borrowers, the Lenders, the
Administrative Agent, the Domestic Swingline Lender, the Domestic Issuing Bank,
the UK Issuing Bank and the UK Swingline Lender. All references to the Credit
Agreement shall hereinafter be references to the Credit Agreement as amended by
this Amendment.
2. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK AND ALL APPLICABLE LAWS OF THE UNITED STATES OF
AMERICA.
3. This Amendment may be executed in one or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same document.
4. This Amendment shall be binding on, and shall inure to the benefit of, the
successors and assigns of the parties hereto.
5. In the event that any part of this Agreement shall be found to be illegal or
in violation of public policy, or for any reason unenforceable at law, such
finding shall not invalidate any other part thereof.
6. TIME IS OF THE ESSENCE UNDER THIS AGREEMENT.
7. The parties agree that their signatures by telecopy or facsimile shall be
effective and binding upon them as though executed in ink on paper but that the
parties shall exchange original ink signatures promptly following any such
delivery by telecopy or facsimile.
8. The Borrowers agree to pay all costs and expenses of the Administrative
Agent and the Lenders incurred in connection with the preparation, execution,
delivery and enforcement of this Amendment, including the reasonable fees and
out-of-pocket expenses of Administrative Agent's counsel.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed and delivered by their respective officers thereunto duly
authorized, all as of the date above written.
CATALINA LIGHTING, INC.,
as a Domestic Borrower
By: /s/ David W. Sasnet
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Name: David W. Sasnett
Title: Chief Financial Officer
CATALINA INTERNATIONAL LIMITED,
formerly known as CATALINA
INTERNATIONAL PLC, as Holdings Borrower
By: /s/ David W. Sasnett
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Name: David W. Sasnett
Title: Director
RING LIMITED (formerly known as Ring PLC),
as a Ring Borrower
By: /s/ David W. Sasnett
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Name: David W. Sasnett
Title: Director
SUNTRUST BANK,
as Administrative Agent, as Domestic Issuing Bank,
as Domestic Swingline Lender, as UK Issuing Bank,
as UK Swingline Lender, and as a Lender
By: /s/ David G. Jones
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Name: David G. Jones
Title: Managing Director
REPUBLIC BANK,
as a Lender
By: /s/ Edward N. Boland
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Name: Edward N. Boland
Title: Senior Consultant
DRESDNER BANK, LATEINAMERIKA, AG,
MIAMI AGENCY
as a Lender
By:
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Name:
Title:
HAMILTON BANK, N.A.
as a Lender
By:
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Name:
Title:
LASALLE BANK, NATIONAL ASSOCIATION
as a Lender
By: /s/ Roger N. Arsham
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Name: Roger N. Arsham
Title: First Vice President
UNION PLANTERS BANK, N.A.
as a Lender
By:
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Name:
Title: