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EXHIBIT 10.72
THIRD AMENDMENT AND WAIVER
THIS THIRD AMENDMENT AND WAIVER (this "Amendment") is entered into as
of the 25th day of February, 1999, by and among the banks listed on the
signature pages hereof (the "Lenders"), KEVCO, INC., a Texas corporation (the
"Borrower"), and NATIONSBANK, N.A. (successor by merger to NationsBank of Texas,
N.A.), as Administrative Agent for the Lenders (the "Administrative Agent"), to
the extent and in the manner provided for in the Credit Agreement (defined below
and herein so called).
BACKGROUND
(a) The Lenders, the Borrower, and the Administrative Agent
are parties to that certain Second Amended and Restated Credit
Agreement dated as of December 1, 1997 (as amended through the date
hereof and as further amended, extended, renewed, or restated from time
to time, the "Credit Agreement"; terms defined in the Credit Agreement
and not otherwise defined herein shall be used herein as defined in the
Credit Agreement).
(b) The Determining Lenders, the Borrower and the Administrative
Agent entered into a Waiver, dated December 30, 1998 (the "First
Waiver"), waiving any Event of Default with respect to Sections 7.10
and 7.11 of the Credit Agreement which may have occurred as a result of
the failure of the Borrower to comply with said Sections for the fiscal
quarter ending December 31, 1998 (the "Existing Events of Default").
(c) The Determining Lenders, the Borrower and the Administrative
Agent entered into a Second Waiver, dated February 15, 1999 (the
"Second Waiver"), extending the termination of the First Waiver from
February 15, 1999, to February 25, 1999.
(d) The Second Waiver will expire by its terms on February 25,
1999, whereupon the Lenders will have the option to exercise all rights
and remedies that they have under the Credit Agreement with respect to
the Existing Events of Default, including but not limited to, refusing
to make any additional Advances under the Credit Agreement.
(e) The Borrower has requested an extension of the waiver with
respect to the Existing Events of Default, thereby allowing the
Borrower to obtain additional Advances under the Credit Agreement which
would not otherwise be permitted under the terms of the Credit
Agreement and the Second Waiver.
(f) As an accommodation to the Borrower in order to permit the
Borrower to obtain additional Advances under the Credit Agreement, the
Lenders, but conditioned upon the Borrower's compliance with the terms
and conditions set forth herein, hereby agree to extend the termination
of the waiver with respect to the Existing Events of Default as
provided herein.
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(g) Additionally, the Borrower, Administrative Agent, and the
Lenders desire to amend the Credit Agreement to provide for, among
other things, an additional short-term credit facility, which will be
made available to the Borrower upon satisfaction of certain conditions
set forth herein.
NOW, THEREFORE, in consideration of the covenants, conditions and
agreements hereafter set forth, and for other good and valuable consideration,
the receipt and adequacy of which are all hereby acknowledged, the parties
hereto covenant and agree as follows:
1. WAIVER. Subject to the satisfaction of the conditions of
effectiveness set forth in Section 11 of this Amendment and the other conditions
contained herein, the Lenders hereby waive the Existing Events of Default.
2. TERMINATION. The waiver provided in Section 1 of this Amendment
shall automatically terminate and be of no further force or effect on the
earlier to occur of (a) March 31, 1999, or (b) breach of or default by the
Borrower under any agreement or covenant contained in this Amendment (the
"Waiver Termination"). The Waiver Termination shall be automatic and will take
place without any action by the Administrative Agent or any Lender.
3. NO WAIVER. The waiver provided in Section 1 of this Amendment shall
not be and shall not be deemed to be a waiver of any Defaults or Events of
Default under the Credit Agreement other than the Existing Events of Default.
4. AMENDMENTS TO THE CREDIT AGREEMENT. The Credit Agreement is hereby
amended as follows:
(a) Section 1.1 is amended by adding or entirely amending the
following terms:
"Applicable Specified Percentages" means the Revolving Credit
Specified Percentage, the Liquidity Specified Percentage, the Facility
A Term Loan Specified Percentage, the Facility B Term Loan Specified
Percentage, or the Total Specified Percentage, as applicable in the
context used.
"Commitments" means, collectively, the Revolving Credit
Commitment, the Liquidity Commitment, the Facility A Term Loan
Commitment and the Facility B Term Loan Commitment.
"Incremental Commitment" means that portion of the Liquidity
Commitment not available to be borrowed until the Liquidity Commitment
Step-Up Date (subject to Section 3.4 hereof), which Incremental
Commitment is equal to $5,000,000.00.
"Liquidity Advance" means an Advance made pursuant to Section
2.1(e) hereof.
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"Liquidity Commitment Step-Up Date" means the later of (a) March
22, 1999, or (b) five Business Days after Borrower delivers to Lenders
a comprehensive business plan prepared in consultation with
PricewaterhouseCoopers.
"Liquidity Commitment" means $10,000,000.00, as reduced or
terminated pursuant to the Loan Documents, provided that, for all
purposes under the Loan Documents, such amount shall be reduced by the
Incremental Commitment until the Liquidity Commitment Step-Up Date (or
until the Liquidity Commitment Maturity Date if the conditions set
forth in Section 3.4 hereof are not satisfied).
"Liquidity Commitment Maturity Date" means March 31, 1999, or
the earlier date of termination in whole of the Liquidity Commitment
pursuant to the Loan Documents.
"Liquidity Note" means the Promissory Note of Borrower
evidencing Liquidity Advances hereunder, substantially in the form of
Exhibit P hereto, together with any extension, renewal, or amendment
thereof, or substitution therefor.
"Liquidity Specified Percentage" means, as to any Lender, the
same percentage as such Lender's Revolving Credit Specified Percentage,
as such percentage may be adjusted or specified in any amendment to
this Agreement or in any Assignment Agreement.
"Notes" means, collectively, the Revolving Credit Notes, the
Liquidity Notes, the Facility A Term Loan Notes and the Facility B Term
Loan Notes.
"Specified Percentage" means, as applicable or as the context
requires, the Revolving Credit Specified Percentage, the Liquidity
Specified Percentage, the Facility A Term Loan Specified Percentage or
the Facility B Term Loan Specified Percentage.
"Total Specified Percentage" means, for any Lender on any date
of determination (and expressed as a percentage), (a) the sum of (i)
the principal amount outstanding under such Lender's Facility A Term
Loan Advances and Facility B Term Loan Advances, (ii) such Lender's
portion of the Liquidity Commitment, or if the Liquidity Commitment has
been terminated, such Lender's portion of the principal amount
outstanding under all Liquidity Advances (according to its Liquidity
Specified Percentage), and (iii) such Lender's portion of the Revolving
Credit Commitment, or if the Revolving Credit Commitment has been
terminated, such Lender's portion of the principal amount outstanding
under all Revolving Credit Advances (according to its Revolving Credit
Specified Percentage), divided by (b) the sum of (i) the principal
amount outstanding under all Facility A Term Loan Advances and all
Facility B Term Loan Advances, (ii) the Revolving Credit Commitment, or
if the Revolving Credit Commitment has been terminated, the
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principal amount outstanding under all Revolving Credit Advances, and
(iii) the Liquidity Commitment, or if the Liquidity Commitment has
been terminated, the principal amount outstanding under all Liquidity
Advances.
(b) The definition of "Applicable Base Rate Margin" in Section 1.1 is
amended by amending the second column heading in the table found in such
definition so that such heading reads,"Facility A Term Loan Advances,
Liquidity Advances, and Revolving Advances."
(c) The definition of "Eligible Assignee" is amended by (i) adding the
text, "or a Liquidity Specified Percentage," immediately following the
text, "Revolving Credit Specified Percentage," found therein, and (ii)
adding the text, "or Liquidity Advances, as the case may be," immediately
following the text, "Revolving Credit Advances," found therein.
(d) Section 2.1(d) is amended by deleting the text, "Any Advance,"
found therein and replacing such text with the following:
"Except for Liquidity Advances, which shall always be Base Rate
Advances, any Advance"
(e) A new Section 2.1(e) is added immediately following Section 2.1(d),
as follows:
(e) Liquidity Advances. Each Lender severally agrees, upon the
terms and subject to the conditions of this Agreement, to make
Liquidity Advances to the Borrower from time to time in an aggregate
amount not to exceed its Liquidity Specified Percentage for the
purposes set forth in Section 5.9 hereof. Subject to Section 2.9
hereof, Liquidity Advances may be repaid and then reborrowed.
Notwithstanding any provision in any Loan Document to the contrary, in
no event shall a Liquidity Advance be made unless a Revolving Credit
Advance cannot be made due to the limitations set forth in
Section 2.1(a), and in no event shall the principal amount of all
outstanding Liquidity Advances exceed the Liquidity Commitment.
(f) Section 2.2(a) is amended by adding the text, "Liquidity Advance,"
immediately following the text, "Revolving Credit Advance," found therein.
(g) Section 2.2(e) is amended by adding the text, "Liquidity Specified
Percentage," immediately following the text, "Revolving Credit Specified
Percentage," found therein.
(h) Section 2.3(a)(ii) and Section 2.3(d) are each amended by adding
the text, "Liquidity Commitment Maturity Date," immediately following the
text, "Revolving Commitment Maturity Date," found therein.
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(i) Section 2.5(c), Section 2.5(e), and Section 2.5(f) are each amended
by adding the following text immediately preceding the text, "Revolving
Credit Advances," found therein:
"Liquidity Advances and to permanently reduce the Liquidity
Commitment by the amount of such prepayment, and if there are no
Liquidity Advances outstanding, any such prepayment shall be applied to
repay outstanding"
(j) A new Section 2.8(d) is added immediately following Section 2.8(c),
as follows:
(d) Liquidity Advances. To the extent not otherwise required to be
paid earlier as provided herein, the principal amount of the Liquidity
Advances shall be due and payable on the Liquidity Commitment Maturity
Date.
(k) Section 2.10(d)(i) is amended by entirely amending clauses (4) and
(5) therein and adding new clauses (6) and (7) immediately following clause
(5), as follows:
(4) fourth, to pay interest then due and payable on the Liquidity
Advances, to be applied in accordance with the Liquidity
Specified Percentages.
(5) fifth, to pay principal then due and payable on the Liquidity
Advances, to be applied in accordance with the Liquidity
Specified Percentages.
(6) sixth, to pay interest then due and payable on the remaining
Advances, to be applied in accordance with the Applicable
Specified Percentages.
(7) seventh, to pay principal then due and payable on the
remaining Advances, to be applied in accordance with the
Applicable Specified Percentages.
(l) Section 2.10(d)(ii) is amended by entirely amending clauses(4) and
(5) therein and adding new clauses (6) and (7) immediately following clause
(5), as follows:
(4) fourth, to pay interest then due and payable on the Liquidity
Advances, to be applied in accordance with the Liquidity
Specified Percentages.
(5) fifth, to pay principal then due and payable on the Liquidity
Advances, to be applied in accordance with the Liquidity
Specified Percentages.
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(6) sixth, to pay interest then due and payable on the remaining
Advances, to be applied pro rata among the Lenders according
to each Lender's pro rata portion of the remaining
Obligations.
(7) seventh, to pay principal then due and payable on the
remaining Advances, to be applied pro rata among the Lenders
according to each Lender's pro rata portion of the remaining
Obligations.
(m) A new Section 3.4 is added immediately following Section 3.3, as
follows:
Section 3.4 Conditions Precedent to Availability of the Incremental
Commitment. In addition to the conditions precedent set forth in
Section 3.2, no Lender shall be obligated to fund any portion of the
Incremental Commitment unless and until (a) any combination of Lenders
whose Total Specified Percentages aggregate at least 75% have approved
such funding, and (b) the Liquidity Commitment Step-Up Date shall have
occurred, and in no event shall any Lender be obligated to fund any
portion of the Incremental Commitment if a Material Adverse Effect
shall have occurred since February 22, 1999.
(n) Section 11.11 is amended by entirely amending clause (a)(i)
therein, as follows:
(i) increase any Specified Percentage or commitment of any Lender
(except increases effected as a result of the availability of the
Incremental Commitment upon satisfaction of the conditions set forth in
Section 3.4 hereof), or
(o) Section 11.11 is further amended by adding the text, "Liquidity
Specified Percentage," immediately following the text, "Revolving Credit
Percentage," found therein.
(p) Exhibit F is amended and restated in the form of, and all
references in the Credit Agreement to Exhibit F are hereby deemed to be
references to, the attached Exhibit F.
(q) A new Exhibit P is added in the form of, and all references in the
Credit Agreement to Exhibit P are hereby deemed to be references to, the
attached Exhibit P.
5. AMENDMENT FEES.
(a) The Borrower shall pay to the Administrative Agent an amendment fee
for the account of each Lender, pro rata according to the sum of such
Lender's Revolving Credit Commitment, Liquidity Commitment (excluding the
Incremental Commitment) and the total outstanding principal amount of all
Term Loan Advances owed to such Lender (the "Phase I Credit Exposure") as
of the date of this Amendment, which fee shall equal 0.25% of the Phase I
Credit Exposure (the "Phase I Fee"). The Phase I Fee shall be earned and
payable as of the date of this Amendment.
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(b) The Borrower shall pay to the Administrative Agent an amendment fee
for the account of each Lender, pro rata according to the sum of such
Lender's Revolving Credit Commitment, Liquidity Commitment (including the
Incremental Commitment) and the total outstanding principal amount of all
Term Loan Advances owed to such Lender (the "Phase II Credit Exposure") as
of the date of this Amendment, which fee shall equal 0.25% of the Phase II
Credit Exposure (the "Phase II Fee"). The Phase II Fee shall be earned and
payable as of the date of this Amendment, but payment shall be deferred
until March 31, 1999. The Phase II Fee shall be waived if (i) either (A)
before March 31, 1999, Borrower shall have received equity contributions of
at least $18,000,000, which are available to be used by the Borrower for
general working capital purposes, or (B) the conditions set forth in
Section 3.4 of the Credit Agreement are not satisfied, or (C) on or before
the Liquidity Commitment Step-Up Date, the Borrower shall have notified the
Administrative Agent that it desires to cancel the Incremental Commitment,
or (ii) before March 31, 1999, the terms and conditions of the Loan
Documents and the Obligations thereunder have been restructured to the
satisfaction of the Lenders.
6. COOPERATION BY BORROWER. The Borrower shall fully cooperate with all
reasonable requests made by the Administrative Agent or any Lender with respect
to (a) the granting and perfection of security interests in Collateral and (b)
information regarding all books, records and assets of the Borrower and its
Subsidiaries and will permit and cooperate with any collateral audit undertaken
by or on behalf of the Lenders, with all such costs to be borne by the Borrower.
7. ACKNOWLEDGMENT OF THE BORROWER. The Borrower acknowledges and agrees
that the Lenders executing this Amendment have done so in their sole discretion
and without any obligation. The Borrower further acknowledges and agrees that
any action taken or not taken by the Lenders or the Administrative Agent prior
to, on or after the date hereof shall not constitute a waiver or modification of
any term, covenant or provision of any Loan Document other than with respect to
the Existing Events of Default or prejudice any rights or remedies other than
with respect to the Existing Events of Default which the Administrative Agent or
any Lender now has or may have in the future under any Loan Document, Applicable
Law or otherwise, all of which rights and remedies are expressly reserved by the
Administrative Agent and the Lenders.
8. SUBSIDIARIES ACKNOWLEDGMENT. By signing below, each of the Subsidiaries
which has executed a Subsidiary Guaranty (a) consents and agrees to this
Amendment's execution and delivery, (b) ratifies and confirms its obligations
under its Subsidiary Guaranty, (c) acknowledges and agrees that its obligations
under its Subsidiary Guaranty are not released, diminished, impaired, reduced,
or otherwise adversely affected by this Amendment, and (d) acknowledges and
agrees that it has no claims or offsets against, or defenses or counterclaims
to, its Subsidiary Guaranty.
9. RELEASE.
(a) The Borrower and each Guarantor hereby unconditionally and
irrevocably remises, acquits, and fully and forever releases and discharges
the Administrative Agent and the Lenders and all respective affiliates and
subsidiaries of the Administrative Agent and
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the Lenders, their respective officers, servants, employees, agents,
attorneys, principals, directors and shareholders, and their respective
heirs, legal representatives, successors and assigns (collectively, the
"Released Lender Parties") from any and all claims, demands, causes of
action, obligations, remedies, suits, damages and liabilities
(collectively, the "Borrower Claims") of any nature whatsoever, whether now
known, suspected or claimed, whether arising under common law, in equity or
under statute, which the Borrower or any Guarantor ever had or now has
against the Released Lender Parties which may have arisen at any time on or
prior to the date of this Amendment and which were in any manner related to
any of the Loan Documents or the enforcement or attempted enforcement by
the Administrative Agent or the Lenders of rights, remedies or recourses
related thereto.
(b) The Borrower and each Guarantor covenants and agrees never to
commence, voluntarily aid in any way, prosecute or cause to be commenced or
prosecuted against any of the Released Lender Parties any action or other
proceeding based upon any of the Borrower Claims which may have arisen at
any time on or prior to the date of this Amendment and were in any manner
related to any of the Loan Documents.
(c) The agreements of the Borrower and each Guarantor set forth in this
Section 9 shall survive termination of this Amendment and the other Loan
Documents.
10. REPRESENTATIONS AND WARRANTIES TRUE, NO EVENT OF DEFAULT. By its
execution and delivery hereof, the Borrower represents and warrants to the
Lenders that, as of the date hereof and after giving effect to the waiver set
forth in Section 1 of this Amendment:
(a) the representations and warranties contained in the Credit
Agreement and the other Loan Documents are true and correct on and as of
the date hereof as made on and as of such date;
(b) no event has occurred and is continuing which constitutes a Default
or an Event of Default; and
(c) the Borrower has (i) initiated a review and assessment of all areas
within its business and operations that could be adversely affected by the
"Year 2000 Problem" (that is, the risk that computer applications used by
the Borrower (or its suppliers and vendors) may be unable to recognize and
perform properly date-sensitive functions involving certain dates prior to
and any date after December 31, 1999), (ii) developed a plan and a timeline
for addressing the Year 2000 Problem on a timely basis, and (iii) to date,
implemented that plan in accordance with that timetable. The Borrower
reasonably believes that all of its computer applications that, based upon
successful implementation of the plan and timeline, are material to its
business and operations will on a timely basis be able to perform properly
date-sensitive functions for all dates before and after January 1, 2000
(that is, be "Year 2000 compliant"), except to the extent that a failure to
do so could not reasonably be expected to have a Material Adverse Effect on
Borrower's business or operations.
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11. CONDITIONS OF EFFECTIVENESS. This Amendment shall not be effective
until all corporate actions of Borrower taken in connection herewith and the
transactions contemplated hereby shall be satisfactory in form and substance to
Administrative Agent and Lenders, and each of the following conditions precedent
shall have been satisfied:
(a) All out-of-pocket fees and expenses in connection with the Loan
Documents, including this Amendment, including legal and other professional
fees and expenses incurred on or prior to the date of this Amendment by
Administrative Agent or any Lender, including, without limitation, the fees
and expenses of Winstead Sechrest & Minick P.C and Arthur Andersen L.L.P.,
shall have been paid.
(b) Administrative Agent and each Lender shall have received each of
the following, in form and substance satisfactory to Administrative Agent,
Lenders and Administrative Agent's counsel:
(i) a certificate of the Borrower certifying (i) as to the accuracy
in all material respects, after giving effect to this Amendment, of the
representations and warranties set forth in the Credit Agreement, the
other Loan Documents and in this Amendment, and (ii) that there exists
no Default or Event of Default, after giving effect to this Amendment,
and the execution, delivery and performance of this Amendment will not
cause a Default or Event of Default;
(ii) fully executed Liquidity Notes;
(iii) certified copies of resolutions of the boards of directors of
the Borrower and each Subsidiary authorizing the transactions
contemplated by this Amendment; and
(iv) such other documents, certificates and instruments as the
Administrative Agent shall require.
(c) The Borrower shall have deposited a retainer of $100,000 with each
of Winstead Sechrest & Minick P.C. and Arthur Andersen L.L.P., to cover
their prospective fees and expenses.
12. CONDITION SUBSEQUENT. As a condition subsequent to the waiver provided
in Section 1 of this Amendment, the events described on Schedule 1 attached
hereto shall have occurred on or before the dates indicated on such Schedule,
and the Borrower's failure to cause such events to occur on or before such dates
shall constitute an Event of Default.
13. REFERENCE TO CREDIT AGREEMENT. Upon the effectiveness of this
Amendment, each reference in the Credit Agreement to "this Agreement,"
"hereunder," or words of like import shall mean and be a reference to the Credit
Agreement, as affected and amended by this Amendment.
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14. EXECUTION IN COUNTERPARTS. This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
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.
15. GOVERNING LAW: BINDING EFFECT. This Amendment shall be governed by and
construed in accordance with the laws of the State of Texas and shall be binding
upon the Borrower, the Administrative Agent, each Lender and their respective
successors and assigns.
16. 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.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK.]
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
the date first above written.
KEVCO, INC.
By: /s/ JERRY E. KIMMEL
-----------------------------------------------
Name: Jerry E. Kimmel
------------------------------------------
Title: Chairman of the Board and President
-----------------------------------------
NATIONSBANK, N.A., as Administrative Agent and
as a Lender
By: /s/ WILLIAM E. LIVINGSTONE, IV
-----------------------------------------------
Name: William E. Livingstone, IV
------------------------------------------
Title: Senior Vice President
-----------------------------------------
NATIONAL CITY BANK KENTUCKY
By: /s/ JERROL Z. MILES
-----------------------------------------------
Name: Jerrol Z. Miles
------------------------------------------
Title: Senior Vice President
-----------------------------------------
GUARANTY FEDERAL BANK, F.S.B.
By: /s/ ROBERT S. HAYS
-----------------------------------------------
Name: Robert S. Hays
------------------------------------------
Title: Vice President
-----------------------------------------
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WELLS FARGO BANK, N.A.
By: /s/ ROGER FRUENDT
------------------------------------------------
Name: Roger Fruendt
-------------------------------------------
Title: Vice President
------------------------------------------
PILGRIM PRIME RATE TRUST
By: Pilgrim Investments, Inc., as its Investment
Manager
By: /s/ MICHEL PRINCE
-----------------------------------------------
Name: Michel Prince, CFA
------------------------------------------
Title: Vice President
-----------------------------------------
ARCHIMEDES FUNDING, L.L.C.
By: ING Capital Advisors, Inc., as Collateral
Manager
By: /s/ MICHAEL J. CAMPBELL
Name: Michael J. Campbell
Title: Senior Vice President & Portfolio Manager
ALLIANCE CAPITAL FUNDING, L.L.C.
By: Alliance Capital Management, L.P., as
Manager on behalf of ALLIANCE CAPITAL
FUNDING, L.L.C.
By: ALLIANCE CAPITAL
MANAGEMENT CORPORATION
General Partner of Alliance Capital
Management, L.P.
By: /s/ JOEL SEREBRANSKY
------------------------------------------------
Name: Joel Serebransky
-------------------------------------------
Title: Vice President
------------------------------------------
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MERRILL LYNCH DEBT STRATEGIES
PORTFOLIO
By: Merrill Lynch Asset Management, L.P., as
Investment Advisor
By: /s/ ANDREW C. LIGGIO
------------------------------------------------
Name: Andrew C. Liggio
-------------------------------------------
Title: Authorized Signatory
------------------------------------------
Merrill Lynch Debt Global Investment Series:
INCOME STRATEGIES PORTFOLIO
By: Merrill Lynch Asset Management, L.P., as
Investment Advisor
By: /s/ ANDREW C. LIGGIO
------------------------------------------------
Name: Andrew C. Liggio
-------------------------------------------
Title: Authorized Signatory
------------------------------------------
BANK ONE, TEXAS, N.A.
By: /s/ BRADLEY C. PETERS
------------------------------------------------
Name: Bradley C. Peters
-------------------------------------------
Title: Vice President
------------------------------------------
PAM CAPITAL FUNDING LP
By: Highland Capital Management, L.P., as
Collateral Manager
By: /s/ JAMES DONDERO
------------------------------------------------
Name: James Dondero, CFA, CPA
-------------------------------------------
Title: President
------------------------------------------
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ACKNOWLEDGED AND AGREED:
KEVCO MANAGEMENT, INC.
By: /s/ JERRY E. KIMMEL
---------------------------------------------------
Name: Jerry E. Kimmel
---------------------------------------------
Title: Chairman of the Board and President
--------------------------------------------
KEVCO HOLDING, INC.
By: /s/ JERRY E. KIMMEL
---------------------------------------------------
Name: Jerry E. Kimmel
---------------------------------------------
Title: Chairman of the Board and President
--------------------------------------------
KEVCO GP, INC.
By: /s/ JERRY E. KIMMEL
---------------------------------------------------
Name: Jerry E. Kimmel
---------------------------------------------
Title: Chairman of the Board and President
--------------------------------------------
KEVCO COMPONENTS, INC.
By: /s/ JERRY E. KIMMEL
---------------------------------------------------
Name: Jerry E. Kimmel
---------------------------------------------
Title: Chairman of the Board and President
--------------------------------------------
DCM DELAWARE, INC.
By: /s/ JERRY E. KIMMEL
---------------------------------------------------
Name: Jerry E. Kimmel
---------------------------------------------
Title: Chairman of the Board and President
--------------------------------------------
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KEVCO MANUFACTURING, L.P.
By: KEVCO GP, INC., its General Partner
By: /s/ JERRY E. KIMMEL
---------------------------------------------------
Name: Jerry E. Kimmel
---------------------------------------------
Title: Chairman of the Board and President
--------------------------------------------
KEVCO DISTRIBUTION, L.P.
By: KEVCO GP, INC., its General Partner
By: /s/ JERRY E. KIMMEL
---------------------------------------------------
Name: Jerry E. Kimmel
---------------------------------------------
Title: Chairman of the Board and President
--------------------------------------------
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SCHEDULE 1
CONDITIONS SUBSEQUENT
1. On or before March 5, 1999, the Borrower shall deliver to the Lenders a
certificate, in form and substance satisfactory to the Lenders,
certifying as to (a) the jurisdictions in which the Borrower or any
Subsidiary conducts business, (b) the addresses of all locations where
the Borrower or any Subsidiary maintains any Collateral, and (c) the
addresses of all real property owned or leased by the Borrower or any
Subsidiary.
2. On or before March 8, 1999, the Borrower shall cause a first priority
perfected security interest in any aircraft owned, now or in the
future, by the Borrower or any Subsidiary to be granted to
Administrative Agent, for the benefit of the Lenders.
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EXHIBIT F
ASSIGNMENT AND ACCEPTANCE
Dated ____________, _____
Reference is made to the Credit Agreement dated as of ____________,
1997 (the "Credit Agreement") among Kevco, Inc., a Texas corporation
("Borrower"), NationsBank, N.A. as Administrative Agent ("Administrative
Agent"), and the lenders parties thereto. Terms defined in the Credit Agreement
are used herein with the same meaning.
__________________ ("Assignor") and __________________ ("Assignee")
agree as follows:
1. Subject to the terms and conditions of this Assignment and
Acceptance, Assignor hereby sells and assigns to Assignee, and Assignee hereby
purchases and assumes from Assignor, the following:
a. $___________ in aggregate amount of the Revolving Credit
Commitment in effect on the Effective Date (as defined below), and the
related pro rata share in the principal amount of Revolving Credit
Advances outstanding on the Effective Date, the Revolving Credit Note
held by Assignor, and Assignor's participation in any Letters of Credit
and Reimbursement Obligations outstanding on the Effective Date;
b. $___________ in aggregate amount of the Liquidity
Commitment in effect on the Effective Date (as defined below), and the
related pro rata share in the principal amount of Liquidity Advances
outstanding on the Effective Date and the Liquidity Note held by
Assignor;
c. $___________ in aggregate principal amount of the Facility
A Term Loan Advances outstanding on the Effective Date and the related
pro rata share in the Facility A Term Loan Note held by Assignor; and
d. $___________ in aggregate principal amount of the Facility
B Term Loan Advances outstanding on the Effective Date and the related
pro rata share in the Facility B Term Loan Note held by Assignor.
2. Assignor (a) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (b) makes no representation or
warranty and assumes no responsibility with respect to (i) any statements,
warranties, or representations made in or in connection with the Credit
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency, or value of the Credit Agreement or any other instrument or
document furnished pursuant thereto or (ii) the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under the Credit Agreement or any other instrument or document
furnished pursuant
18
thereto; and (c) attaches the Promissory Notes referred to in Paragraph 1 above
to exchange such Promissory Notes for new Promissory Notes as provided in
Section 11.6(f) of the Credit Agreement.
3. Assignee (a) confirms that it has received a copy of the Credit
Agreement and the other Loan Documents, together with copies of the financial
statements referred to in Sections 4.1(j), 6.1 and 6.2 of the Credit Agreement
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Acceptance; (b) agrees that it will, independently and without reliance upon the
Administrative Agent, Assignor, or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Credit Agreement
and the other Loan Documents; (c) appoints and authorizes the Administrative
Agent to take such action as agent on its behalf and to exercise such powers
under the Credit Agreement, the other Loan Documents, and this Assignment and
Acceptance as are delegated to the Administrative Agent by the terms thereof and
hereof, together with such powers as are reasonably incidental thereto and
hereto; (d) agrees that it will perform in accordance with its terms all of the
obligations which by the terms of the Credit Agreement, the other Loan
Documents, and this Assignment and Acceptance are required to be performed by it
as a Lender; and (e) specifies the addresses set forth in Schedule I attached
hereto as its address for the receipt of notices and as its initial LIBOR Lender
Office, respectively[; and (f) attaches the forms prescribed by the IRS
certifying as to Assignee's status for purposes of determining exemption from
United States withholding taxes with respect to all payments to be made to
Assignee under the Credit Agreement, the other Loan Documents, and this
Assignment and Acceptance].
4. The effective date for this Assignment and Acceptance shall be
_____________, _____ (the "Effective Date").
5. Upon such acceptance as of the Effective Date and upon the
remittance of a $3,500 processing fee to the Administrative Agent, (a) Assignee
shall be a party to the Credit Agreement and, to the extent provided in this
Assignment and Acceptance, have the rights and obligations of a Lender
thereunder and (b) Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations under the
Credit Agreement.
6. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of Texas. Without excluding any other
jurisdiction, Assignee agrees that the courts of Texas will have jurisdiction
over proceedings in connection herewith.
7. After giving effect to this Assignment and Acceptance (and all other
assignments by the Assignor to be effective as of the Effective Date):
a. Assignee's Revolving Credit Specified Percentage shall be _____%.
b. Assignee's Liquidity Specified Percentage shall be _____%.
c. Assignee's Facility A Term Loan Specified Percentage shall be
_____%.
d. Assignee's Facility B Term Loan Specified Percentage shall be
_____%.
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e. Assignee's Total Specified Percentage shall be _____%.
f. Assignor's Revolving Credit Specified Percentage shall be _____%.
g. Assignor's Liquidity Specified Percentage shall be _____%.
h. Assignor's Facility A Term Loan Specified Percentage shall be
_____%.
i. Assignor's Facility B Term Loan Specified Percentage shall be
_____%.
j. Assignor's Total Specified Percentage shall be _____%.
8. This Assignment and Acceptance may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
[NAME OF ASSIGNOR]
By:
------------------------------------
Name:
-------------------------------
Title:
------------------------------
[NAME OF ASSIGNEE]
By:
------------------------------------
Name:
-------------------------------
Title:
------------------------------
Accepted this __ day of ___________, _____
NATIONSBANK, N.A.,
as Administrative Agent
By:
------------------------------------
Name:
-------------------------------
Title:
------------------------------
KEVCO, INC.
By:
------------------------------------
Name:
-------------------------------
Title:
------------------------------
20
Schedule I
ASSIGNEE'S ADDRESS
1. Address for the Advances and Receipt of Notices
2. Initial LIBOR Lending Office
21
EXHIBIT P
LIQUIDITY NOTE
Dallas, Texas $___________ February 25, 1999
KEVCO, INC., a Texas corporation (the "Borrower"), for value received,
promises to pay to the order of __________________ ("Lender"), or its registered
assigns, at the principal office of NationsBank, N.A., in lawful money of the
United States of America, the principal sum of $__________, or such lesser sum
as shall be due and payable from time to time hereunder, as hereinafter
provided. All terms used but not defined herein shall have the meanings set
forth in the Credit Agreement described below.
Principal of and interest on the unpaid principal balance of Liquidity
Advances under this Liquidity Note (this "Note") from time to time outstanding
shall be due and payable as set forth in the Credit Agreement.
This Note is issued pursuant to and evidences Liquidity Advances under
a Credit Agreement, dated as of December 1, 1997, among the Borrower,
NationsBank, N.A., as Administrative Agent, and the lenders parties thereto (as
amended, restated, supplemented, renewed, extended or otherwise modified from
time to time, "Credit Agreement"), to which reference is made for a statement of
the rights and obligations of the Lender and the duties and obligations of the
Borrower in relation thereto; but neither this reference to the Credit Agreement
nor any provision thereof shall affect or impair the absolute and unconditional
obligation of the Borrower to pay the principal sum of and interest on this Note
when due.
Except as provided in the Credit Agreement, the Borrower and all
endorsers, sureties and guarantors of this Note hereby severally wive demand,
presentment for payment, protest, notice of protest, notice of acceleration,
notice of intention to accelerate the maturity of this Note, and all other
notices of any kind, diligence in collecting, the bringing of any suit against
any party and any notice of or defense on account of any extensions, renewals,
partial payments or changes in any manner of or in this Note or in any of its
terms, provisions and covenants, or any releases or substitutions of any
security, or any delay, indulgence or other act of any trustee or any holder
hereof, whether before or after maturity.
THIS NOTE AND THE OTHER LOAN DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS; PROVIDED, HOWEVER, THAT IT
IS AGREED THAT THE PROVISIONS OF CHAPTER 346 OF THE TEXAS FINANCE CODE, AS
AMENDED, SHALL NOT APPLY TO THE ADVANCES, THIS NOTE AND THE OTHER LOAN
DOCUMENTS. THE BORROWER AGREES THAT THE STATE AND FEDERAL COURTS OF TEXAS
LOCATED IN DALLAS, TEXAS, SHALL HAVE THE EXCLUSIVE JURISDICTION OVER THE
PROCEEDINGS IN CONNECTION WITH THIS NOTE AND THE OTHER LOAN DOCUMENTS.
22
THIS NOTE, TOGETHER WITH THE OTHER LOAN DOCUMENTS, REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES HERETO. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
KEVCO, INC.
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------