EXHIBIT 10.20
AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
(this "Amendment Agreement") is made and entered into as of this 29th day of
May, 1998 (the "Effective Date"), by and among BOLLE INC., a Delaware
corporation having its chief executive office in Rye, New York (the
"Borrower"), NATIONSBANK, NATIONAL ASSOCIATION, a national banking association
organized and existing under the laws of the United States of America
("NationsBank"), in its capacity as agent for the Lenders (as defined below)
(in such capacity, the "Agent"), and each of the Lenders executing and
delivering a signature page hereto.
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the lenders from time to time
party thereto (the "Lenders") have entered into that certain Second Amended and
Restated Credit Agreement dated as of March 11, 1998 (as from time to time
amended, modified, supplemented or restated, the "Credit Agreement"), pursuant
to which the Lenders have made available to the Borrower a term loan facility
and a revolving credit facility, including a letter of credit facility; and
WHEREAS, the Borrower desires to enter into a Convertible Subordinated
Note Purchase Agreement dated as of May 29, 1998 (the "Note Purchase
Agreement") pursuant to which it will issue up to $7,000,000 of certain 0%
Convertible Subordinated Notes Due May 29, 2002 (the "Convertible Notes"); and
WHEREAS, the Borrower has requested that the Credit Agreement be
amended to allow the execution and delivery of the Note Purchase Agreement and
the issuance of the Convertible Notes in the manner set forth herein and the
Agent and the Lenders are willing to agree to such amendment upon the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and the
fulfillment of the conditions set forth herein, the parties hereto do hereby
agree as follows:
1. Definitions. Any capitalized terms used herein without definition
shall have the meaning set forth in the Credit Agreement.
2. Amendment. Subject to the terms and conditions set forth herein,
the Credit Agreement is hereby amended as follows:
(a) Section 1.2 is hereby amended by adding the following
definition of "Convertible Notes" in its proper alphabetical order in
Section 1.2:
"Convertible Notes" means the 0% Convertible
Subordinated Notes Due May 29, 2002 in the principal amount
of up to $7,000,000 issued in connection with and pursuant to
the terms of the Note Purchase Agreement.
(b) Section 1.2 is hereby amended by adding the following definition
of "Note Purchase Agreement" in its proper alphabetical order in Section 1.2:
"Note Purchase Agreement" means that
certain Convertible Subordinated Note Purchase
Agreement dated as of May 29, 1998 by and among the
Borrower and certain note purchasers pursuant to
which the Borrower is issuing the Convertible Notes.
(c) Section 1.2 is hereby amended by adding to the end of the
definition of "Consolidated Leverage Ratio" the following:
; provided further, however, at all times until May
29, 2001 the Convertible Notes shall be excluded
from the determination of Consolidated Funded
Indebtedness for purposes of calculating the
Consolidated Leverage Ratio.
(d) Section 1.2 is hereby amended by adding to the end of the
definition of "Consolidated Net Worth" the following:
; provided, however, notwithstanding any application
of GAAP, in no event shall the Convertible Notes be
determined to be part of Consolidated Net Worth.
(e) Section 1.2 is hereby amended by amending and restating in its
entirety the definition of "Equity Offering" as set forth below:
"Equity Offering" means a public or private
offering of equity securities (including, without
limitation, any security or investment not
constituting Indebtedness exchangeable, exercisable
or convertible for or into, or otherwise entitling
the holder to receive, equity securities) of the
Borrower or any Subsidiary (other than securities
issued to the Borrower or another Subsidiary);
provided, however, the term "Equity Offering" shall
not include (i) the portion of any such offering
that does not result in any Net Proceeds to the
Borrower or any Subsidiary, (ii) any issuance of
equity securities in connection with the exercise of
stock options or warrants granted to, or purchase of
restricted stock by, eligible participants under the
Stock Option Plan, and (iii) the issuance of the
Convertible Notes unless and until, for purposes
only of Section 11.3, the Convertible Notes are
converted in accordance with their terms into shares
of Common Stock;
(f) Section 1.2 is hereby amended by amending and restating in its
entirety the definition of "Permitted Acquisition" as set forth below:
"Permitted Acquisition" means the Bolle Australia
Acquisition if consummated and effective on or prior
to June 30, 1998, and the
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Bolle UK Acquisition if consummated and effective on
or prior to August 31, 1998, each pursuant to the
Share Purchase Agreements and as to which all
applicable conditions specified in Section 7.1 and
Section 7.2 hereof shall have been satisfied.
(g) Section 10.10(c) is hereby amended to amend and restate the second
parenthetical occurring therein as set forth below:
(including, without limitation, shares of
the Preferred Stock or the Bolle Warrants but
excluding mandatory (as opposed to optional)
redemption of the Convertible Notes, such exclusion
not to in any way limit, diminish or restrict
application of Section 12.1(o) hereof)
(h) Section 10.18 is hereby amended to add at the end of its title ";
Note Purchase Agreement", to delete the word "or" preceding "(iii)" and insert
a comma in lieu thereof, and to add at the end of such Section ", or (iv) the
Note Purchase Agreement as of its original date."
(i) The following Section 12.1(o) is hereby inserted immediately
following Section 12.1(n) of the Credit Agreement:
(o) if, notwithstanding Section 10.10
hereof, (i) the Common Stock shall cease to be
listed on the Nasdaq National Market, the Nasdaq
Small Cap Market, the New York Stock Exchange or the
American Stock Exchange and the Convertible Notes
are outstanding and (ii) the Agent, on behalf of the
Lenders, shall have provided written Notice to the
Borrower that the same constitutes a Default or an
Event of Default under the Credit Agreement;
3. Consent. (a) The Agent and the Lenders hereby consent to, and waive
any Default or Event of Default arising or occurring under
(i) Sections 10.1 and 10.10 of the Credit Agreement as a
result of, the issuance by the Borrower of the Convertible Notes
pursuant to the terms of the Note Purchase Agreement substantially in
the forms thereof delivered to the Agent and the Lenders; and
(ii) Sections 7.1(a)(xxiv) and 12.1(m) of the Credit
Agreement as a result of the failure of the Borrower to have sold the
Texas Property on or before April 30, 1998 (the Texas Property having
been sold in accordance with the terms of the Texas Property Purchase
Agreement, and the Net Proceeds received therefrom applied by the
Borrower in accordance with the terms of Section
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2.6(e)(i)(A) of the Credit Agreement, prior to the date of this
Amendment Agreement).
(b) Subject to satisfaction of the condition set forth in
Sections 5(a)(ii) and (iii) hereof, the Agent and the Lenders further
consent to redemption, payment, prepayment or repurchase of the
Convertible Notes pursuant to, and in accordance with, the terms of
Sections 9.3, 11.12 and 12.1(a) of the Note Purchase Agreement as in
effect on the date of this Amendment Agreement and at maturity of the
Convertible Notes on May 29, 2002 and agree that the Purchasers (as
defined in the Note Purchase Agreement) shall be third-party
beneficiaries of, and may rely on, this Section 3(b).
4. Representations and Warranties. By its execution and delivery of
this Amendment Agreement, the Borrower represents and warrants to the Agent and
the Lenders as follows:
(a) The representations and warranties made by Borrower in
Article VIII of the Credit Agreement are true and correct on and as of
the date hereof, except to the extent that such representations and
warranties expressly relate to an earlier date;
(b) There has been no material adverse change in the
condition, financial or otherwise, of the Borrower and its
Subsidiaries, taken as a whole, since the date of the most recent
financial reports of the Borrower received by the Agent and the
Lenders under Section 9.1 of the Credit Agreement; and
(c) No event has occurred and is continuing which
constitutes, and no condition exists which upon the consummation of
the transaction contemplated hereby would constitute, a Default or an
Event of Default on the part of the Borrower under the Credit
Agreement.
5. Conditions. The effectiveness of this Amendment Agreement is
subject to the following:
(a) The Agent shall have received:
(i) nine (9) counterparts of this Amendment Agreement duly
executed by all signatories hereto;
(ii) a fully-executed copy of an escrow agreement of even
date herewith between the Agent and the Borrower (the "Escrow
Agreement") providing for the placement into an escrow account
maintained at NationsBank of the entire Net Proceeds from the issuance
of the Convertible Notes and termination of such escrow account either
in connection with redemption of the Convertible Notes pursuant to
Section 12.1(a) of the Note Purchase Agreement or for application of
such Net Proceeds as set forth in (b)(ii) and (iii) below;
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(iii) delivery by the Borrower of the entire Net Proceeds
from the issuance of the Convertible Notes to NationsBank to hold in
escrow pursuant to the terms of the Escrow Agreement; and
(iv) copies of all additional agreements, instruments and
documents which the Agent may reasonably request, such documents, when
appropriate, to be certified by appropriate governmental authorities.
(b) Each party hereto, by its execution of this Amendment Agreement,
agrees to each of the following and the events set forth in (ii) and (iii)
below shall have occurred:
(i) The execution and delivery of this Amendment Agreement
shall constitute the notice required under Section 2.6(b) of the
Credit Agreement, and no additional notice need be given by the
Borrower to the Agent;
(ii) Notwithstanding anything to the contrary herein or in
the Credit Agreement, a prepayment of the Term Loan with the Net
Proceeds resulting from the issuance of the Convertible Notes and held
in escrow by NationsBank pursuant to the Escrow Agreement shall be
made on the Business Day such funds are first available for such a
prepayment pursuant to the Escrow Agreement in accordance with the
first sentence of Section 2.6(b) of the Credit Agreement as if such
Section 2.6 was otherwise applicable and the last sentence of Section
2.6(b) of the Credit Agreement shall not be applicable; and
(iii) After the Borrower makes the prepayment required by the
first sentence of Section 2.6(b) of the Credit Agreement, the
remaining balance of the Net Proceeds from the issuance of the
Convertible Notes previously held in escrow by NationsBank pursuant to
the Escrow Agreement shall be used to make a prepayment of the
Revolving Credit Outstandings under the Revolving Credit Facility,
without any reduction in the Revolving Credit Commitment or Total
Revolving Credit Commitment; provided, however, that the minimum
amount and integral multiple limitations on prepayments contained in
the last sentence of Section 3.4(b) of the Credit Agreement shall not
apply to the prepayment required under this paragraph 5(b)(iii).
(c) All proceedings of the Borrower relating to the matters provided
for herein shall be reasonably satisfactory to the Lenders, the Agent and their
counsel.
6. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the subject
matter hereof and supersedes any prior negotiations and agreements among the
parties relative to such subject matter. No promise, condition, representation
or warranty, express or implied, not herein set forth shall bind any party
hereto, and not one of them has relied on any such promise, condition,
representation or warranty. Each of the parties hereto acknowledges that,
except as otherwise expressly stated in this Amendment Agreement, no
representations, warranties or commitments,
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express or implied, have been made by any party to the other. None of the terms
or conditions of this Amendment Agreement may be changed, modified, waived or
canceled orally or otherwise, except by writing, signed by all the parties
hereto, specifying such change, modification, waiver or cancellation of such
terms or conditions, or of any proceeding or succeeding breach thereof.
7. Limitation of Waiver and Consents. The waiver and consents
contained herein are limited as specified herein and shall remain in effect
only so long as the Borrower is in compliance with the terms of this Amendment
Agreement. The waiver and consents are granted only for the specific instance
specified herein and in no manner creates a course of dealing or otherwise
impairs the future ability of the Agent or the Lenders to declare a default
under or otherwise enforce the terms of the Credit Agreement.
8. Full Force and Effect of Agreement. Except as hereby specifically
amended, modified or supplemented, the Credit Agreement and all other Loan
Documents are hereby confirmed and ratified in all respects and shall remain in
full force and effect according to their respective terms. Each Guarantor
hereby acknowledges and agrees to the amendments of the Credit Agreement set
forth herein and hereby confirms and ratifies in all respects the Guaranty and
enforceability of the Guaranty against such Guarantor in accordance with its
terms.
9. Counterparts. This Amendment Agreement may be executed in any
number of counterparts, each of which shall be deemed an original as against
any party whose signature appears thereon, and all of which shall together
constitute one and the same instrument.
10. Governing Law. This Amendment Agreement shall in all respects be
governed by the laws and judicial decisions of the state of New York, without
giving effect to the conflict of laws provisions thereof.
11. Enforceability. Should any one or more of the provisions of this
Amendment Agreement be determined to be illegal or unenforceable as to one or
more of the parties hereto, all other provisions nevertheless shall remain
effective and binding on the parties hereto.
12. Credit Agreement. All references in any of the Loan Documents to
the "Credit Agreement" shall mean the Credit Agreement as amended hereby.
13. Successors and Assigns. This Amendment Agreement shall be binding
upon and inure to the benefit of each of the Borrower, the Lenders and the
Agent and their respective successors, assigns and legal representatives;
provided, however, that the Borrower, without the prior consent of the Agent
and each of the Lenders, may not assign any rights, powers, duties or
obligations hereunder.
14. Expenses. Borrower agrees to pay to the Agent all reasonable
out-of-pocket expenses incurred or arising in connection with the negotiation
and preparation of this Amendment Agreement.
[Signature pages follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be duly executed by their duly authorized officers, all as of the
day and year first above written.
BORROWER:
BOLLE INC.
By: /s/ Ian G. H. Ashken
--------------------------------
Name: Ian G. H. Ashken
------------------------------
Title: Executive Vice President
-----------------------------
LENDERS:
NATIONSBANK, NATIONAL ASSOCIATION
as Agent for the Lenders and as a
Lender
By: /s/ Susan Timmerman
--------------------------------
Name: Susan Timmerman
------------------------------
Title: Vice President
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Amendment No. 1 to
Second Amended and Restated Credit Agreement
SIGNATURE PAGE 1 OF 2
BANK BOSTON, N.A.
By:_________________________
Name:_______________________
Title:______________________
CREDIT AGRICOLE INDOSUEZ
By:________________________
Name:______________________
Title:_____________________
By:________________________
Name:______________________
Title:_____________________
EUROPEAN AMERICAN BANK
By: /s/ Mark Saeger
------------------------
Name: Mark Saeger
----------------------
Title: Vice President
---------------------
IMPERIAL BANK
By: /s/ Ray Vadalma
-------------------------------
Name: Ray Vadalma
-----------------------------
Title: Senior Vice President
----------------------------
NATIONAL CITY BANK OF KENTUCKY
By: /s/ David Pullen
-------------------------------
Name: David Pullen
-----------------------------
Title: Vice Presiden
----------------------------
Amendment No. 1 to
Second Amended and Restated Credit Agreement
SIGNATURE PAGE 2 OF 2