EXHIBIT 10.2
WAIVER AGREEMENT
THIS WAIVER AGREEMENT (the "Agreement"), dated as of September 29,
2003, is by and among PRG-SCHULTZ USA, INC. (formerly The Profit Recovery Group
USA, Inc.), a Georgia corporation (the "Borrower"), PRG-SCHULTZ INTERNATIONAL,
INC. (formerly The Profit Recovery Group International, Inc.), a Georgia
corporation (the "Parent"), each of the Domestic Subsidiaries of the Parent
(together with the Parent, the "Guarantors"), the Lenders party thereto and BANK
OF AMERICA, N.A., as Administrative Agent. All capitalized terms used herein and
not otherwise defined shall have the meanings provided in the Credit Agreement
(as defined below).
WITNESSETH:
WHEREAS, the Borrower, the Guarantors, the Lenders and the
Administrative Agent entered into that certain Credit Agreement dated as of
December 31, 2001 (as amended or modified from time to time, the "Credit
Agreement");
WHEREAS, the Borrower acknowledges that Events of Default will exist
under the Credit Agreement on September 30, 2003 as a result of the failure of
the Credit Parties to comply with (i) the terms of Section 7.11(i) of the Credit
Agreement as of the fiscal quarter ending September 30, 2003 and (ii) the terms
of Section 7.11(ii) of the Credit Agreement as of the fiscal quarter ending
September 30, 2003 (the "Covenant Defaults");
WHEREAS, the Borrower has requested that the Lenders waive the Covenant
Defaults and continue to make available to the Borrower the Loans provided under
the Credit Agreement; and
WHEREAS, the Lenders are willing to waive the Covenant Defaults subject
to the terms and conditions specified in this Agreement;
NOW, THEREFORE, in consideration of the agreements contained herein and
other good and valuable consideration, the parties hereby agree as follows:
1. Waiver. Subject to the other terms and conditions of this
Agreement, the Administrative Agent and the Lenders hereby waive the Covenant
Defaults until November 15, 2003 (the "Waiver Termination Date"). Accordingly,
from the date hereof through and including the Waiver Termination Date, the
Administrative Agent and the Lenders shall, subject to the terms and conditions
set forth herein, forbear exercising their rights and remedies arising
exclusively as a result of the Covenant Defaults; provided, however, that the
Administrative Agent and the Lenders shall be free to exercise any or all of
their rights and remedies arising on account of the Covenant Defaults at any
time after the occurrence of any Default or Event of Default under the Credit
Agreement or any other Credit Document other than the Covenant Defaults. This
limited waiver shall not modify or affect (a) the Credit Parties' obligation to
comply fully with Section 7.11(i) and Section 7.11(ii) of the Credit Agreement
at all times after the Waiver Termination Date and (b) the Credit Parties'
obligations to comply fully with any other duty, term, condition or covenant
contained in the Credit Agreement and the other Credit Documents. This limited
waiver is limited solely to the Covenant Defaults, and nothing contained in this
Agreement shall be deemed to constitute a waiver of any other rights or remedies
the Administrative Agent or any Lender may have under the Credit Agreement or
any other Credit Documents or under applicable law.
2. Conditions Precedent. This Agreement shall become effective
immediately upon receipt by the Administrative Agent of counterparts of this
Agreement duly executed by the Borrower, the Guarantors, the Administrative
Agent and the Required Lenders.
3. Miscellaneous.
(a) The obligations of the Credit Parties under the
Credit Agreement and the other Credit Documents, are hereby ratified
and confirmed and shall remain in full force and effect according to
their terms.
(b) The Credit Parties acknowledge and confirm (i) that
the Administrative Agent, on behalf of the Lenders, has a valid and
enforceable first priority security interest in the Collateral, (ii)
that the Borrower's obligation to repay the outstanding principal
amount of the Loans and reimburse the Issuing Lender for any drawing on
a Letter of Credit is unconditional and not subject to any offsets,
defenses or counterclaims, (iii) that the Administrative Agent and the
Lenders have performed fully all of their respective obligations under
the Credit Agreement and the other Credit Documents, and (iv) by
entering into this Agreement, the Lenders do not waive (except as
specifically provided in Section 1 hereof) or release any term or
condition of the Credit Agreement or any of the other Credit Documents
or any of their rights or remedies under such Credit Documents or
applicable law or any of the obligations of any Credit Party
thereunder.
(c) The Credit Parties represent and warrant to the
Lenders that (i) the representations and warranties of the Credit
Parties set forth in Section 6 of the Credit Agreement are true and
correct as of the date hereof and (ii) no unwaived event has occurred
and is continuing which constitutes a Default or an Event of Default.
(d) This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be an
original, but all of which shall constitute one and the same
instrument. It shall not be necessary in making proof of this Agreement
to produce or account for more than one such counterpart.
(e) This Agreement shall be governed by and construed in
accordance with, the laws of the State of Georgia.
(f) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and
assigns.
(g) The Borrower and the Guarantors, as applicable,
affirm the liens and security interests created and granted in the
Collateral Documents and agree that this Agreement shall in no manner
adversely affect or impair such liens and security interests.
(h) Each Credit Party hereby represents and warrants as
follows:
(i) Each Credit Party has taken all necessary
action to authorize the execution, delivery and performance of
this Agreement.
(ii) This Agreement has been duly executed and
delivered by the Credit Parties and constitutes each of the
Credit Parties' legal, valid and binding obligations,
enforceable in accordance with its terms, except as such
enforceability may be subject to
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(i) bankruptcy, insolvency, reorganization,
fraudulent conveyance or transfer, moratorium or similar laws
affecting creditors' rights generally and (ii) general
principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in
equity).
(iii) No consent, approval, authorization or order
of, or filing, registration or qualification with, any court
or governmental authority or third party is required in
connection with the execution, delivery or performance by any
Credit Party of this Agreement.
(i) The Guarantors (i) acknowledge and consent to all of
the terms and conditions of this Agreement, (ii) affirm all of their
obligations under the Credit Documents and (iii) agree that this
Agreement and all documents executed in connection herewith do not
operate to reduce or discharge the Guarantors' obligations under the
Credit Agreement or the other Credit Documents.
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Each of the parties hereto has caused a counterpart of this Agreement
to be duly executed and delivered as of the date first above written.
BORROWER: PRG-SCHULTZ USA, INC. (formerly The Profit
Recovery Group USA, Inc.), a Georgia
corporation
By: /s/ Donald E. Ellis, Jr.
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Name: Donald E. Ellis, Jr.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
GUARANTORS: PRG-SCHULTZ INTERNATIONAL, INC. (formerly
The Profit Recovery Group International,
Inc.), a Georgia corporation
By: /s/ Donald E. Ellis, Jr.
-----------------------------------------
Name: Donald E. Ellis, Jr.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
PRGFS, INC.,
PRGLS, INC.,
each a Delaware corporation
By: /s/ Donald E. Ellis, Jr.
-----------------------------------------
Name: Donald E. Ellis, Jr.
Title: Executive Vice President - Finance
PRGRS, INC., a Delaware corporation
By: /s/ Mark L. Henry
-----------------------------------------
Name: Mark L. Henry
Title: Vice President
PRG HOLDING CO. (FRANCE) NO. 1, LLC,
PRG HOLDING CO. (FRANCE) NO. 2, LLC,
each a Delaware limited liability company
By: /s/ Donald E. Ellis, Jr.
-----------------------------------------
Name: Donald E. Ellis, Jr.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
GUARANTORS: THE PROFIT RECOVERY GROUP U.K., INC.,
THE PROFIT RECOVERY GROUP ASIA, INC.,
PRG-SCHULTZ CANADA, INC. (formerly The
Profit Recovery Group Canada, Inc.),
THE PROFIT RECOVERY GROUP NEW ZEALAND, INC.,
THE PROFIT RECOVERY GROUP NETHERLANDS, INC.,
THE PROFIT RECOVERY GROUP BELGIUM, INC.,
THE PROFIT RECOVERY GROUP MEXICO, INC.,
PRG-SCHULTZ FRANCE, INC. (formerly The
Profit Recovery Group France, Inc.)
PRG-SCHULTZ AUSTRALIA, INC. (formerly The
Profit Recovery Group Australia, Inc.),
THE PROFIT RECOVERY GROUP GERMANY, INC.,
PRG INTERNATIONAL, INC.,
THE PROFIT RECOVERY GROUP SWITZERLAND, INC.,
THE PROFIT RECOVERY GROUP SOUTH AFRICA,
INC.,
THE PROFIT RECOVERY GROUP SPAIN, INC.,
THE PROFIT RECOVERY GROUP ITALY, INC.,
THE PROFIT RECOVERY GROUP GREECE, INC.,
THE PROFIT RECOVERY GROUP PORTUGAL, INC.,
PRG-SCHULTZ JAPAN, INC. (formerly Payment
Technologies, Inc.)
THE PROFIT RECOVERY GROUP COSTA RICA, INC.,
PRG-SCHULTZ PUERTO RICO, INC. (formerly PRG,
INC.,)
PRG USA, INC.,
each a Georgia corporation
By: /s/ Donald E. Ellis, Jr.
-----------------------------------------
Name: Donald E. Ellis, Jr.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
HS&A ACQUISITION - UK, INC.,
a Texas corporation
By: /s/ Donald E. Ellis, Jr.
-----------------------------------------
Name: Donald E. Ellis, Jr.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
ADMINISTRATIVE AGENT: BANK OF AMERICA, N.A.
By: /s/ Laura B. Schmuck
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Name: Laura B. Schmuck
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Title: Assistant Vice President
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LENDERS: BANK OF AMERICA, N.A.
By: /s/ Nancy S. Goldman
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Name: Nancy S. Goldman
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Title: Senior Vice President
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LASALLE BANK, NATIONAL ASSOCIATION
By: /s/ Sara A. Huizinga
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Name: Sara A. Huizinga
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Title: Assistant Vice President
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WACHOVIA BANK, NATIONAL ASSOCIATION
(formerly known as Wachovia Bank, N.A.)
By: /s/ Michael J. Romano
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Name: Michael J. Romano
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Title: Vice President
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