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EXHIBIT 10.1
FOURTH AMENDMENT TO AMENDED AND RESTATED
SENIOR REVOLVING CREDIT AGREEMENT
This FOURTH AMENDMENT TO AMENDED AND RESTATED SENIOR REVOLVING CREDIT
AGREEMENT (the "Amendment") is made as of this 6th day of April, 2001, by and
among ENESCO GROUP, INC., a Massachusetts corporation (the "Borrower"), the
Borrowing Subsidiaries who may from time to time become a party to the Amended
and Restated Senior Revolving Credit Agreement, and FLEET NATIONAL BANK, a
national banking association (the "Bank").
RECITALS
The Borrower and the Bank are parties to a certain Amended and Restated
Senior Revolving Credit Agreement dated as of August 23, 2000, as amended by a
First Amendment to Amended and Restated Senior Revolving Credit Agreement dated
as of November 27, 2000, as further amended by a Second Amendment to Amended and
Restated Senior Revolving Credit Agreement dated as of November 30, 2000, and as
further amended by a Third Amendment to Amended and Restated Senior Revolving
Credit Agreement dated as of March 23, 2001 (the "Credit Agreement"), pursuant
to which the Bank has extended certain financial accommodations to the Borrower
including those evidenced by a Borrower Note in the face amount of $50,000,000
dated August 3, 2000, a Back-Up L/C Demand Note in the face amount of
$25,000,000 dated November 27, 2000 and a Back-Up F/X Demand Note in the face
amount of $10,000,000 dated November 27, 2000. The Borrower and the Bank have
agreed to further modify the terms and provisions of the Credit Agreement, as
more fully described and set forth hereinbelow. Capitalized terms not otherwise
defined in this Amendment shall have their meanings as defined in the Credit
Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Borrower and the Bank agree
that the Credit Agreement is amended as follows:
1. The definition of "Accounts Receivable," "Account" or "Accounts" which
appears in ARTICLE I is deleted in its entirety and replaced with the
following:
"Accounts Receivable," "Account" or "Accounts" means a
right to payment for goods sold or leased or for services
rendered by Borrower or Subsidiaries, whether or not earned by
performance, including all Accounts (as defined in the Uniform
Commercial Code).
2. The definition of "Applicable Margin" (including the pricing grid and
terms of pricing determination) which appears in ARTICLE I is deleted
in its entirety and replaced with the following:
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"Applicable Margin" for LIBOR Advances or Cost of Funds
Advances means one hundred fifty basis points (1.50%).
"Applicable Margin" for Alternate Base Rate Advances means
zero basis points (0.00%).
3. The definition of "Borrowing Capacity" which appears in ARTICLE I is
deleted in its entirety and replaced with the following:
"Borrowing Capacity" means the lesser of:
(x) Forty Million Dollars ($40,000,000), or
(y) (i) the sum of eighty-five percent (85%) of
Accounts Receivable of the Borrower for the months of
April, May and June of 2001, (ii) the sum of
seventy-five percent (75%) of Accounts Receivable of
the Borrower for the month of July of 2001, and (iii)
the sum of seventy percent (70%) of Accounts
Receivable of the Borrower for each month thereafter,
in each case, which Accounts Receivable are not
Ineligible Accounts of the Borrower.
4. The definition of "Commitment" which appears in ARTICLE I is deleted in
its entirety and replaced with the following:
"Commitment" means the obligation of the Bank, subject to
Borrowing Capacity, to make Loans not exceeding an aggregate
principal amount of $25,000,000 for all such Loans outstanding
at any time, or as set forth in any Notice of Assignment
relating to any assignment that has become effective pursuant
to Section 12.3.1, as such amount may be modified from time to
time pursuant to the terms hereof.
5. The definition of "Cost of Funds Advance" which appears in ARTICLE I is
deleted in its entirety and replaced with the following:
"Cost of Funds Advance" means an Advance denominated in
Dollars which bears interest at the Cost of Funds Rate.
6. The following definition for the term "Cost of Funds Rate" is added to
ARTICLE I:
"Cost of Funds Rate" means with respect to any Cost of
Funds Advance, a rate per annum equal to the sum of (i) the
Applicable Margin, plus (ii) the Cost of Funds.
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7. The definition of "Facility Fee" which appears in ARTICLE I is deleted
in its entirety and replaced with the following:
"Facility Fee" means a per annum fee equal to twenty-five
basis points (0.25%) payable quarterly in arrears by the
Borrower to the Bank on the amount of the Commitment,
irrespective of Borrowing Capacity or aggregate outstanding
Advances.
8. The following additional subclauses (q) and (r) are added to the end of
the definition of "Ineligible Accounts" which appears in ARTICLE I:
(q) Any Account due from any Account Debtor not domiciled
and having its principal place of business located in the
United States.
(r) Any Account in which the Bank does not hold a valid,
duly perfected, first priority security interest.
9. The following definition for the term "Inventory is added to ARTICLE I:
"Inventory" means and includes all present and future
Inventory as defined in the Uniform Commercial Code, excluding
raw materials, work in process, and all materials used or
consumed in the Debtor's business; all such Inventory as now
owned or hereafter acquired, anywhere located including,
without limitation, with manufacturers or at warehouses,
including any such returned or repossessed inventory or any
such inventory in transit, all products of the accessions to
such inventory, and all documents of title, whether negotiable
or non-negotiable, representing any of the foregoing.
10. The definition of "L/C Facility Limit" which appears in ARTICLE I is
deleted in its entirety and replaced with the following:
"L/C Facility Limit" means the obligation of the Bank
pursuant to Section 2.1.B, subject to Borrowing Capacity
(dollar for dollar based upon the aggregate stated amount of
all Letters of Credit outstanding), to issue Letters of Credit
up to an aggregate stated amount of all such Letters of Credit
outstanding at any given time of $15,000,000.
11. The definition of "Loan Documents" which appears in ARTICLE I is
deleted in its entirety and replaced with the following:
"Loan Documents" means this Agreement, the Notes, the
Guarantees, the Pledge Agreements, the Security Agreements and
any
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Elections to Participate executed by the Borrower, the
Borrowing Subsidiaries or any Guarantor in connection
herewith.
12. The following definition for the term "Security Agreements" is added to
ARTICLE I:
"Security Agreements" mean the Security Agreements between
the Borrower or any Subsidiary and the Bank relating to the
grant of security interests to the Bank in certain personal
property of the Borrower or any such Subsidiary.
13. Section 2.1 which appears in ARTICLE II is deleted in its entirety and
replaced with the following:
"2.1. Commitment. From and including the date of this
Agreement and prior to the Facility Termination Date, the Bank
agrees, on the terms and conditions set forth in this
Agreement, to make Loans to the Credit Parties from time to
time subject to Borrowing Capacity in an aggregate Dollar
Amount not to exceed at any one time outstanding the amount of
its Commitment. Subject to the terms of this Agreement, each
Credit Party may borrow, repay and reborrow at any time prior
to the Facility Termination Date. Unless earlier terminated in
accordance with the terms and conditions of this Agreement,
the Commitments to lend hereunder shall expire on the Facility
Termination Date."
14. The first paragraph of Section 2.1.B which appears in ARTICLE II is
deleted in its entirety and replaced with the following:
"2.1.B. Letter of Credit Facility. From and including the
date of this Agreement and prior to the Facility Termination
Date, the Bank agrees, on the terms and conditions set forth
in this Agreement, upon request of the Borrower, to issue
Letters of Credit subject to the L/C Facility Limit with
expiration dates of not later than 90 days beyond the Facility
Termination Date (the "L/C Facility")."
15. Section 2.15 which appears in ARTICLE II is deleted in its entirety and
replaced with the following:
"2.15. Letters of Credit. Letters of Credit may be issued,
extended or renewed at any time prior to the Facility
Termination Date. A per annum fee equal to one-half of the
then Applicable Margin for LIBOR Advances multiplied by the
stated amount of the Letter of Credit to be issued shall be
paid by the Borrower to the Bank in connection with the
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issuance of each Letter of Credit. In addition, the Borrower
shall pay to the Bank a fronting fee equal to one-eighth of
one percent (0.125%) per annum on the amount of the Letter of
Credit, plus all of the Bank's customary charges for
processing, issuance and amendments to the Letter of Credit.
All Letter of Credit fees and charges shall be payable on each
Payment Date in arrears."
16. The following additional subsections are added to the end of Section
6.1:
(xiii) promptly following the execution of this Amendment,
and on an annual basis within 45 days following the end of
each fiscal year of the Borrower, a schedule of Accounts
Receivable of the Borrower by Account Debtor, such schedule to
include any Account Debtor or Account Debtors liable to the
Debtor on any Account or Accounts in the aggregate of $25,000
or more, together with the address of each such Account Debtor
and such other information as may be reasonably requested by
the Bank, all in form and substance acceptable to the Bank,
and certified as true and correct by the Chief Financial
Officer of the Borrower.
(xiv) within 30 days after the close of each fiscal
quarter of the Borrower, a summary schedule of Accounts
Receivable of the Borrower, with aging, and such other
information for Account Debtors as may be reasonably requested
by the Bank, all in form and substance acceptable to the Bank,
and certified as true and correct by the Chief Financial
Officer of the Borrower.
(xv) within 30 days after the close of each fiscal quarter
of the Borrower, a complete schedule of Inventory of the
Borrower by location, in form and substance acceptable to the
Bank, and certified as true and correct by the Chief Financial
Officer of the Borrower.
17. The following additional Subsection 7.15 is added to the end of ARTICLE
VII:
7.15 The occurrence of any Event of Default under any of
the Security Agreements.
18. EXHIBIT C-1 attached as a part of the Credit Agreement is deleted in
its entirety and replaced with EXHIBIT C-1 attached as a part of this
Amendment.
19. Except as amended, modified or supplemented by this Amendment, all of
the terms, conditions, covenants, provisions, representations,
warranties and conditions of the Credit Agreement shall remain in full
force and effect and are
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hereby acknowledged, ratified, confirmed and continued as if fully
restated hereby.
20. The invalidity or unenforceability of any term or provision hereof
shall not affect the validity or enforceability of any other term or
provision hereof or contained in the Credit Agreement.
21. It is the intention of the parties hereto that this Amendment shall not
constitute a novation and shall in no way adversely affect or impair
performance of the obligations of the Borrower under the Credit
Agreement.
22. The Borrower hereby confirms and ratifies the obligations established
under the Credit Agreement, as amended hereby.
23. This Amendment is to be governed and construed in accordance with the
laws of the Commonwealth of Massachusetts.
24. This Amendment may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the
parties thereto may execute this Agreement by signing any such
counterpart. This Amendment shall be effective when it has been
executed by the Borrower and the Bank.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the foregoing has been executed as an instrument
under seal as of the date first above written.
WITNESS: ENESCO GROUP, INC.
By: /s/ Anne-Lee Verville
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Print Name: Anne-Lee Verville
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Title: Interim CEO and President
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By: /s/ Jeffrey W. Lemajeur
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Print Name: Jeffrey W. Lemajeur
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Title: Chief Financial Officer
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FLEET NATIONAL BANK
By: Sheryl McQuade
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Its Vice President
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