AMENDMENT NUMBER TWO
TO
CREDIT AGREEMENT
This AMENDMENT NUMBER TWO TO CREDIT AGREEMENT (this "Amendment"), dated
as of March 24, 1997, is entered into by and among MOBILE MINI, INC., a Delaware
corporation (the "Borrower"), each financial institution a party to the Credit
Agreement (collectively, the "Lenders"), and BT COMMERCIAL CORPORATION acting as
agent for the Lenders (the "Agent"), in light of the following facts:
R E C I T A L S
A. The parties hereto have previously entered into that certain Credit
Agreement, dated as of March 28, 1996, as amended by that certain Amendment
Number One to Credit Agreement, dated as of November __, 1996 (as amended, the
"Agreement").
B. The parties hereto desire to amend the Agreement in accordance with
the terms of this Amendment.
A G R E E M E N T
NOW THEREFORE, the parties hereto agree as follows:
1. Defined Terms. All initially capitalized terms used but not defined
herein shall have the meanings assigned to such terms in the Agreement.
2. Amendments. The Agreement is hereby amended as follows:
(a) Section 8.1 of the Agreement is hereby amended by deleting
such Section in its entirety and replacing it with the following:
"8.1 Consolidated Tangible Net Worth. The Borrower
shall maintain a Consolidated Tangible Net Worth as of the last day of each
fiscal quarter of not less than the amount set forth below:
====================================================================================================================
Quarter-Ended Amount
- --------------------------------------------------------------------------------------------------------------------
6/30/96 $10,900,000
- --------------------------------------------------------------------------------------------------------------------
9/30/96 $11,500,000
- --------------------------------------------------------------------------------------------------------------------
12/31/96 $12,100,000
- --------------------------------------------------------------------------------------------------------------------
3/31/97 $12,300,000
1
- --------------------------------------------------------------------------------------------------------------------
6/30/97 $12,900,000
- --------------------------------------------------------------------------------------------------------------------
9/30/97 $13,700,000
- --------------------------------------------------------------------------------------------------------------------
12/31/97 $14,100,000
- --------------------------------------------------------------------------------------------------------------------
3/31/98 $15,000,000
- --------------------------------------------------------------------------------------------------------------------
6/30/98 $15,900,000
- --------------------------------------------------------------------------------------------------------------------
9/30/98 $17,100,000
- --------------------------------------------------------------------------------------------------------------------
12/31/98 $18,100,000
- --------------------------------------------------------------------------------------------------------------------
3/31/99 $18,800,000
and thereafter
====================================================================================================================
(b) Section 8.2 of the Agreement is hereby amended by deleting
such Section in its entirety and replacing it with the following:
"8.2 EBITDA. The Borrower shall maintain EBITDA for
the immediately preceding four fiscal quarters calculated as of the last day of
each such quarter of not less than the amount set forth below:
==================================================================================================================
Quarter-Ended Amount
- ------------------------------------------------------------------------------------------------------------------
6/30/96 $6,100,000
- ------------------------------------------------------------------------------------------------------------------
9/30/96 $6,900,000
- ------------------------------------------------------------------------------------------------------------------
12/31/96 $6,400,000
- ------------------------------------------------------------------------------------------------------------------
3/31/97 $6,900,000
- ------------------------------------------------------------------------------------------------------------------
6/30/97 $7,200,000
- ------------------------------------------------------------------------------------------------------------------
9/30/97 $7,500,000
- ------------------------------------------------------------------------------------------------------------------
12/31/97 $9,000,000
- ------------------------------------------------------------------------------------------------------------------
3/31/98 $10,200,000
- ------------------------------------------------------------------------------------------------------------------
6/30/98 $10,800,000
- ------------------------------------------------------------------------------------------------------------------
9/30/98 $11,300,000
- ------------------------------------------------------------------------------------------------------------------
12/31/98 $11,900,000
- ------------------------------------------------------------------------------------------------------------------
3/31/99 and thereafter $12,500,000
==================================================================================================================
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(c) Section 8.3 of the Agreement is hereby amended by deleting
such Section in its entirety and replacing it with the following:
"8.3 Fixed Charge Coverage Ratio. The Borrower shall
maintain for the quarter ended June 30, 1996, for the two quarters ended
September 30, 1996, for the three quarters ended December 31, 1996, and
thereafter for the immediately preceding four fiscal quarters a ratio of EBITDA
to Consolidated Fixed Charges of not less than the ratio set forth below, in
each case calculated as of the end of each such quarter:
====================================================================================================================
Four Quarters Ended Ratio
- --------------------------------------------------------------------------------------------------------------------
6/30/96 1.15:1.0
- --------------------------------------------------------------------------------------------------------------------
9/30/96 1.25:1.0
- --------------------------------------------------------------------------------------------------------------------
12/31/96 1.10:1.0
- --------------------------------------------------------------------------------------------------------------------
3/31/97 1.0:1.0
- --------------------------------------------------------------------------------------------------------------------
6/30/97 1.0:1.0
- --------------------------------------------------------------------------------------------------------------------
9/30/97 1.0:1.0
- --------------------------------------------------------------------------------------------------------------------
12/31/97 1.20:1.0
- --------------------------------------------------------------------------------------------------------------------
3/31/98 1.30:1.0
- --------------------------------------------------------------------------------------------------------------------
6/30/98 1.35:1.0
and thereafter
====================================================================================================================
(d) Section 8.4 of the Agreement is hereby amended by deleting
such Section in its entirety and replacing it with the following:
"8.4 Interest Coverage Ratio. The Borrower shall
maintain for the immediately preceding four fiscal quarters a ratio of (a)
EBITDA to (b) Interest Expense of not less than the ratio set forth below, in
each case calculated as of the end of each such quarter:
====================================================================================================================
Four Quarters Ended Ratio
- --------------------------------------------------------------------------------------------------------------------
6/30/96 1.65:1.0
- --------------------------------------------------------------------------------------------------------------------
9/30/96 1.75:1.0
- --------------------------------------------------------------------------------------------------------------------
12/31/96 1.60:1.0
- --------------------------------------------------------------------------------------------------------------------
3/31/97 1.60:1.0
- --------------------------------------------------------------------------------------------------------------------
6/30/97 1.60:1.0
- --------------------------------------------------------------------------------------------------------------------
3
- --------------------------------------------------------------------------------------------------------------------
9/30/97 1.60:1.0
- --------------------------------------------------------------------------------------------------------------------
12/31/97 1.90:1.0
- --------------------------------------------------------------------------------------------------------------------
3/31/98 2.20:1.0
- --------------------------------------------------------------------------------------------------------------------
6/30/98 2.30:1.0
- --------------------------------------------------------------------------------------------------------------------
9/30/98 2.40:1.0
- --------------------------------------------------------------------------------------------------------------------
12/31/98 2.50:1.0
- --------------------------------------------------------------------------------------------------------------------
3/31/99 2.60:1.0
and thereafter
====================================================================================================================
(e) Section 8.6 of the Agreement is hereby amended by deleting
such Section in its entirety and replacing it with the following:
"8.6 Debt Ratio. The Borrower shall maintain for the
four immediately preceding fiscal quarters, calculated as of the end of each
such quarter, a ratio of Funded Debt to EBITDA of not more than the ratio set
forth below:
====================================================================================================================
Four Quarters Ended Ratio
- --------------------------------------------------------------------------------------------------------------------
6/30/96 5.95:1.0
- --------------------------------------------------------------------------------------------------------------------
9/30/96 5.50:1.0
- --------------------------------------------------------------------------------------------------------------------
12/31/96 6.30:1.0
- --------------------------------------------------------------------------------------------------------------------
3/31/97 6.0:1.0
- --------------------------------------------------------------------------------------------------------------------
6/30/97 6.0:1.0
- --------------------------------------------------------------------------------------------------------------------
9/30/97 6.0:1.0
- --------------------------------------------------------------------------------------------------------------------
12/31/97 5.50:1.0
- --------------------------------------------------------------------------------------------------------------------
3/31/98 4.35:1.0
- --------------------------------------------------------------------------------------------------------------------
6/30/98 4.25:1.0
- --------------------------------------------------------------------------------------------------------------------
9/30/98 4.15:1.0
- --------------------------------------------------------------------------------------------------------------------
12/31/98 3.95:1.0
- --------------------------------------------------------------------------------------------------------------------
3/31/99 3.70:1.0
and thereafter
====================================================================================================================
(f) Section 8.8 of the Agreement is hereby amended by deleting
such Sections in its entirety and replacing it with the following:
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"8.8 Capital Expenditures. The Borrower shall not make
payments for Capital Expenditures (net of sales of Eligible Container Fleet
Inventory) in excess of the following amounts per fiscal year; provided, that
Borrower may carry forward and add to the next year's limitation amount (but not
beyond such next year) the unused portion of the limitation on Capital
Expenditures for the prior year, up to a maximum of one-half (1/2) of the prior
year's limitation amount; and provided, further, that the amount set forth in
this Section 8.8 as an annual limit to Capital Expenditures shall be increased,
for a year in which Borrower effects any sale of equity securities of Borrower,
by an amount equal to three hundred percent of the net proceeds received by
Borrower from any such sale of equity securities of Borrower. The Borrower shall
not make any Capital Expenditures that are not directly related to the business
conducted on the Closing Date by the Borrower.
===================================================================================================================
Fiscal Year Capital Expenditures Capital Expenditures For Plant,
Ended Property and Equipment Only
(i.e., Excluding Container Fleet
Inventory Held For Sale)
- -------------------------------------------------------------------------------------------------------------------
12/31/96 $11,700,000 $3,650,000
- -------------------------------------------------------------------------------------------------------------------
12/31/97 $12,800,000 $4,100,000
- -------------------------------------------------------------------------------------------------------------------
12/31/98 $11,600,000 $2,800,000
- -------------------------------------------------------------------------------------------------------------------
12/31/99 $10,900,000 $2,600,000
and thereafter
===================================================================================================================
3. Conditions Precedent. The effectiveness of this Amendment is subject
to and conditioned upon the fulfillment of each and all of the following
conditions precedent:
(a) BTCC shall have received this Amendment duly executed by
Borrower and Majority Lenders; and
(b) BTCC shall have received an affirmation letter duly
executed by each guarantor under the Guaranties, indicating the consent by each
such guarantor to the execution and delivery by Borrower of this Amendment.
4. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties on separate counterparts, each of which
when so executed and delivered shall be deemed to be an original. All such
counterparts, taken together, shall constitute but one and the same Amendment.
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5. Reaffirmation of the Agreement. Except as specifically amended by
this Amendment, the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed at Los Angeles, California as of the date first hereinabove written.
MOBILE MINI, INC.,
a Delaware corporation
By: /s/ Larry Trachtenberg
-------------------------------------
Larry Trachtenberg,
Chief Financial Officer
BT COMMERCIAL CORPORATION,
a Delaware corporation,
individually and as Agent
By: /s/
-------------------------------------
Title:
----------------------------------
NATIONSBANK OF TEXAS, N.A.
By: /s/
-------------------------------------
Title:
----------------------------------
DEUTSCHE FINANCIAL SERVICES
CORPORATION
By: /s/
-------------------------------------
Title:
----------------------------------
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CONSENT OF GUARANTORS
Each of the undersigned, as a guarantor of the obligations of MOBILE
MINI, INC., a Delaware corporation ("Borrower"), arising out of that certain
Credit Agreement, dated as of March 28, 1996, as amended by that certain
Amendment Number One to Credit Agreement, dated as of November __, 1996 (as
amended, the "Agreement"), among BT Commercial Corporation, a Delaware
corporation ("Agent") and the lenders party thereto ("Lenders"), on the one
hand, and Borrower, on the other, hereby acknowledges receipt of a copy of that
certain Amendment Number Two to Credit Agreement, dated as of March 24, 1997,
among Agent, Lenders and Borrower, consents to the terms contained therein, and
agrees that the Continuing Guaranty executed by each of the undersigned shall
remain in full force and effect as a continuing guaranty of the obligations of
Borrower owing to Agent and Lenders under the Agreement.
Although Agent has informed us of the matters set forth above, and we
have acknowledged same, we understand and agree that Agent has no duty under the
Agreement, the Guaranty or any other agreement between us to so notify us or to
seek an acknowledgment, and nothing contained herein is intended to or shall
create such a duty as to any advances or transactions hereafter.
IN WITNESS WHEREOF, each of the undersigned has caused this Consent of
Guarantors to be duly executed by their respective authorized officers as of
March 24, 1997.
MOBILE MINI I, INC.,
an Arizona corporation
By /s/
-------------------------------------
Title
-----------------------------------
DELIVERY DESIGN SYSTEMS, INC.,
an Arizona corporation
By /s/
-------------------------------------
Title
-----------------------------------
7