FIRST AMENDMENT, dated as of May 10, 2005 (this "Amendment"),
to the CREDIT AGREEMENT, dated as of August 2, 2004 (as otherwise amended,
supplemented or modified from time to time, the "Credit Agreement"), among
ALLIED SECURITY HOLDINGS LLC, a Delaware limited liability company (the
"Borrower"), the lending institutions from time to time parties thereto,
SOVEREIGN BANK, as Syndication Agent, CIT LENDING SERVICES CORPORATION, ING
CAPITAL LLC and PNC BANK, NATIONAL ASSOCIATION, as Co-Documentation Agents, BEAR
XXXXXXX CORPORATE LENDING INC., as Administrative Agent, and BEAR, XXXXXXX & CO.
INC. ("Bear Xxxxxxx"), as Sole Lead Arranger and Sole Book Running Manager.
A. The Borrower has requested that the Credit Agreement be amended to,
among other things, provide for new Term Loans C, the proceeds of which will be
used to repay in full all currently outstanding Term Loans. The Borrower has
appointed Bear Xxxxxxx to act as Sole Lead Arranger and Sole Book Running
Manager for this Amendment.
B. Each existing Lender with a Term Loan Commitment or with outstanding
Term Loans (an "Existing Term Loan Lender") that executes and delivers a
signature page to this Amendment specifically in the capacity of a "Continuing
Lender" (a "Continuing Lender") will be deemed upon the First Amendment
Effective Date to have agreed to the terms of this Amendment and to have made a
commitment to make Term Loans C in an aggregate principal amount up to, but not
in excess of, the aggregate principal amount of such Existing Term Loan Lender's
outstanding Term Loans immediately prior to the First Amendment Effective Date
("Existing Term Loans"). Each Existing Term Loan Lender that executes and
delivers this Amendment solely in the capacity as an Existing Term Loan Lender
and not specifically as a Continuing Lender shall be deemed to have agreed to
this Amendment, but will not be deemed by virtue of such execution and delivery
to have undertaken any commitment to make Term Loans C.
C. Each Person (other than a Continuing Lender in its capacity as such)
that agrees to make Term Loans C (an "Additional Lender") will, on the First
Amendment Effective Date, make such Term Loans C to the Borrower in the manner
contemplated by Section 3. The cash proceeds of any such Term Loans C will be
used solely to repay in full the outstanding principal amount of Existing Term
Loans of Existing Term Loan Lenders (other than any such Existing Term Loans
refinanced pursuant to an exchange thereof for Term Loans C as provided herein)
and to pay fees and expenses in connection with such prepayments and with this
Amendment.
D. The Required Lenders are willing to effect such amendment (and the other
amendments set forth herein), and the Continuing Lenders and the Additional
Lenders are willing to make Term Loans C as contemplated hereby, in each case on
the terms and subject to the conditions of this Amendment.
E. Capitalized terms used but not defined herein shall have the meanings
assigned to such terms in the Credit Agreement, as amended hereby.
Accordingly, in consideration of the mutual agreements herein
contained and other good and valuable consideration, the sufficiency and receipt
of which are hereby acknowledged, the parties hereto agree as follows:
Section 1. Amendment of the Credit Agreement. The Credit Agreement is
hereby amended, effective as of the First Amendment Effective Date, as follows:
(a) Amendment of Section 1.1 (Defined Terms). Section 1.1 is hereby revised
by making the following revisions:
(i) Deleted Defined Terms. Deleting the following definitions:
(A) "Term Commitment";
(B) "Term Loan"; and
(C) "Term Lender".
(ii) Term Loans C. Replacing each reference in the Credit Agreement to
the term "Term Loan" and "Term Loans" with the term "Term Loan C" or "Term Loans
C", as applicable.
(iii) New Term Commitments. Replacing each reference in the Credit
Agreement to the term "Term Commitment" and "Term Commitments" with the term
"New Term Commitment" or "New Term Commitments", as applicable.
(iv) New Term Lenders. Replacing each reference in the Credit
Agreement to the term "Term Lender" and "Term Lenders" with the term "New Term
Lender" or "New Term Lenders", as applicable.
(v) New Defined Terms. Inserting the following definitions in the
appropriate alphabetical order therein:
(A) "Continuing Lender": as defined in the recitals to the First
Amendment.
(B) "First Amendment": the First Amendment to the Credit
Agreement, dated as of May 10, 2005, among the Borrower, the lending
institutions from time to time parties thereto, SOVEREIGN BANK, as
Syndication Agent, CIT LENDING SERVICES CORPORATION, ING CAPITAL LLC
and PNC BANK, NATIONAL ASSOCIATION, as Co-Documentation Agents, BEAR
XXXXXXX CORPORATE LENDING INC., as Administrative Agent, and BEAR,
XXXXXXX & CO. INC., as Sole Lead Arranger and Sole Book Running
Manager.
(C) "First Amendment Effective Date": the date on which the First
Amendment is made effective in accordance with the terms thereof.
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(D) "New Term Commitment": as to any Lender, the commitment of
such Lender to make Term Loans C hereunder pursuant to Section 3 of
the First Amendment on the First Amendment Effective Date. The amount
of each Lender's New Term Commitment is set forth on Schedule A to the
First Amendment (as appended to the First Amendment on the First
Amendment Effective Date) or in the Assignment and Acceptance pursuant
to which such Lender assumed its New Term Commitment, in each case as
the same may be changed from time to time pursuant to the terms
hereof.
(E) "New Term Lender": each Lender that has a New Term Commitment
or that holds a Term Loan C.
(F) "Term Loan C": a Loan made to the Borrower in Dollars on the
First Amendment Effective Date pursuant to Section 3 of the First
Amendment. On the First Amendment Effective Date, the aggregate
principal amount of the Term Loans C shall be $202,000,000.
(vi) Revised Defined Terms. Revising the definitions of the terms set
forth below as follows:
(A) Applicable Margin. Deleting the defined term "Applicable
Margin" in its entirety and replacing it with the following:
"Applicable Margin": for each Type of Loan, the rate per annum set
forth under the relevant column heading below:
ABR Loans Eurodollar Loans
--------- ----------------
Revolving Loans and
Swingline Loans 3.50% 4.50%
Term Loans C 2.75% 3.75%
provided, that so long as no Default or Event of Default has
occurred and is continuing, the Applicable Margin with respect
to Term Loans C shall be adjusted, on and after the first
Adjustment Date (as defined below) occurring after the
completion of two full fiscal quarters of the Borrower after
the Closing Date, based on changes in the Consolidated
Leverage Ratio, with such adjustments to become effective on
the date (the "Adjustment Date") that is three Business Days
after the date on which the relevant financial statements are
delivered to the Lenders pursuant to Section 6.1 and to remain
in effect until the next adjustment to be effected pursuant to
this paragraph. If any financial statements referred to above
are not delivered within the time periods specified in Section
6.1, then, until the date that is three Business Days after
the date on which such financial statements are delivered, the
highest Applicable Margin set forth in the table shown below
shall apply. On each Adjustment Date, the Applicable Margin
for Term Loans C shall be adjusted to be equal to the
Applicable Margin opposite the Pricing Level determined to
exist on such Adjustment Date from the financial statements
relating to such Adjustment Date.
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Pricing Level ABR Loans Eurodollar Loans
------------- --------- ----------------
I 2.75% 3.75%
II 2.50% 3.50%
As used herein, the following rules shall govern the
determination of Pricing Levels on each Adjustment Date:
"Pricing Level I" shall exist on an Adjustment Date if the
Consolidated Leverage Ratio for the relevant period of four
consecutive fiscal quarters is greater than or equal to 3.5 to
1.
"Pricing Level II" shall exist on an Adjustment Date if the
Consolidated Leverage Ratio for the relevant period of four
consecutive fiscal quarters is less than 3.5 to 1.
(B) Excess Cash Flow. Deleting the word "and" immediately
preceding the number "(viii)" and inserting the following immediately
before the period at the end of such definition: ", and (ix) the
aggregate amount of reasonable and documented cash expenditures made
in connection with Permitted Acquisitions during such fiscal year".
(C) L/C Commitment. Replacing the dollar amount "$40,000,000"
with the dollar amount "$50,000,000".
(D) Lenders. Replacing the phrase "as defined in the preamble
hereto" with the phrase "the several banks and other financial
institutions or entities from time to time parties to this Agreement".
(E) Required Lenders. Replacing the existing clause (a) with the
following: "(a) the holders of more than 50% of the aggregate unpaid
principal amount of the Term Loans C then outstanding and".
(b) Amendment of Section 2.1 (New Term Commitments). Section 2.1 is
deleted in its entirety and replaced with the following: "Pursuant to the First
Amendment, each New Term Lender severally agrees to make a Term Loan C or Term
Loans C on the First Amendment Effective Date to the Borrower in Dollars, which
Term Loans C shall not exceed for any such Lender the New Term Commitment of
such Lender as of the First Amendment Effective Date, provided that each
Continuing Lender having a New Term Commitment shall make Term Loans C on the
First Amendment Effective Date by exchanging its existing term loans designated
as "Term Loans" under the Credit Agreement immediately prior to the First
Amendment Effective Date for Term Loans C in the manner contemplated by Section
3 of the First Amendment. The Term Loans C may from time to time be Eurodollar
Loans or ABR Loans, as determined by the Borrower and notified to the
Administrative Agent in accordance with Sections 2.2 and 2.12."
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(c) Amendment of Section 2.3 (Repayment of Term Loans C). Section 2.3
is deleted in its entirety and replaced with the following:
(i) The Term Loan C of each New Term Lender shall mature in 21
consecutive quarterly installments, each of which shall be in an
amount equal to such Lender's Term Percentage multiplied by the amount
set forth below opposite such installment:
Installment Principal Amount
----------- ----------------
June 30, 2005 $1,250,000
September 30, 2005 $1,250,000
December 31, 2005 $1,250,000
March 31, 2006 $1,250,000
June 30, 2006 $1,250,000
September 30, 2006 $1,250,000
December 31, 2006 $1,250,000
March 31, 2007 $7,500,000
June 30, 2007 $7,500,000
September 30, 2007 $7,500,000
December 31, 2007 $7,500,000
March 31, 2008 $7,500,000
June 30, 2008 $7,500,000
September 30, 2008 $7,500,000
December 31, 2008 $7,500,000
March 31, 2009 $7,500,000
June 30, 2009 $7,500,000
September 30, 2009 $7,500,000
December 31, 2009 $7,500,000
March 31, 2010 $51,625,000
June 30, 2010 $51,625,000 or remainder
(d) Amendment of Section 4.16 (Use of Proceeds). Section 4.16 is
revised by deleting the first sentence thereof in its entirety and replacing it
with "The proceeds of all Term Loans C funded on the First Amendment Effective
Date shall be used solely to repay in full the outstanding principal amount of
those existing term loans designated as "Term Loans" under the Credit Agreement
immediately prior to the First Amendment Effective Date and to pay fees and
expenses in connection with such prepayments and with the First Amendment."
(e) Amendment of Section 7.8(h) (Investments). Section 7.8(h) is
revised by replacing the dollar amount "$30,000,000" with the dollar amount
"$60,000,000" and deleting the second proviso.
(f) Amendment of Section 10.2 (Notices). Section 10.2 is revised by
(i) replacing the words "Xxxxxxxxxxx Xxxxx" as the contact person for the
Borrower with "Xxxxxxx X. Xxxxxxxxx", and (ii) replacing the words "Mafco
Holdings Inc." with "MacAndrews & Forbes Holdings Inc.".
5
(g) Amendment of Exhibits to the Credit Agreement. The Exhibits to the
Credit Agreement are revised by deleting the contents of Exhibit I-1 to the
Credit Agreement in their entirety and replacing them with the contents of
Exhibit A to this Amendment.
Section 2. Representations and Warranties. To induce the other parties
hereto to enter into this Amendment, the Borrower represents and warrants to
each of the Lenders (including the Additional Lenders) and the Administrative
Agent that, as of the First Amendment Effective Date:
(a) This Amendment has been duly authorized, executed and delivered by
the Borrower and this Amendment and the Credit Agreement, as amended
hereby, constitutes the Borrower's legal, valid and binding obligation,
enforceable against it in accordance with its terms except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights generally and
by general principles of equity (regardless of whether such enforceability
is considered in a proceeding at law or in equity).
(b) The representations and warranties set forth in Section 4
(Representations and Warranties) of the Credit Agreement are, after giving
effect to this Amendment, true and correct in all material respects on and
as of the First Amendment Effective Date, except where such representations
and warranties expressly relate to an earlier date (in which case they were
true and correct in all material respects as of such earlier date).
(c) No Default or Event of Default has occurred and is continuing.
Section 3. Term Loans C. (a) Subject to the terms and conditions
set forth herein, each Continuing Lender and each Additional Lender agrees to
make Term Loans C to the Borrower on the First Amendment Effective Date in
amounts equal to its New Term Commitment (as defined below). Notwithstanding
anything herein or in the Credit Agreement to the contrary, the aggregate
principal amount of the Term Loans C shall not exceed the aggregate principal
amount of the Existing Term Loans immediately prior to the First Amendment
Effective Date. For purposes hereof, a Person shall become an Additional Lender
and a party to the Credit Agreement by executing and delivering to the
Administrative Agent, on or prior to the First Amendment Effective Date, a
signature page to this Amendment specifically in the capacity of an "Additional
Lender" setting forth the amounts of Term Loans C such Person commits to make on
the First Amendment Effective Date. The "New Term Commitment" for any Term Loans
C of (i) any Continuing Lender shall be the principal amount of its Existing
Term Loans or such lesser amount as is determined by Bear Xxxxxxx and notified
to such Lender prior to the First Amendment Effective Date and (ii) any
Additional Lender shall be the amount of such commitment set forth on its
signature page hereto or such lesser amount as is allocated to it by Bear
Xxxxxxx and notified to it prior to the First Amendment Effective Date. The
aggregate amount of New Term Commitments shall equal the aggregate principal
amount of the Existing Term Loans.
(b) Each Continuing Lender and each Additional Lender shall make Term
Loans C on the First Amendment Effective Date by (i) exchanging its Existing
Term Loans, if any, for Term Loans C in an equal principal amount (to the extent
the amounts of such Existing
6
Term Loans, if any, do not exceed the New Term Commitment of such Lender) and
(ii) transferring to the Administrative Agent, in the manner contemplated by the
Credit Agreement (including Section 2.2 (Procedure for New Term Loan Borrowing)
thereof), an amount equal to the excess, if any, of its New Term Commitment over
the principal amount of Existing Term Loans, if any, exchanged by it pursuant to
clause (i) above. The Borrower hereby irrevocably directs the Administrative
Agent pursuant to Section 2.10 (Optional Prepayments) of the Credit Agreement to
apply all proceeds of the Term Loans C received hereunder immediately upon the
receipt thereof to prepay outstanding Existing Term Loans. The commitments of
the Additional Lenders and the exchange undertakings of the Continuing Lenders
are several and no such Lender shall be responsible for any other Lender's
failure to make or acquire by exchange any Term Loans C.
(c) The obligations of each Continuing Lender and each Additional
Lender to make Term Loans C on the First Amendment Effective Date are subject to
the satisfaction of the following conditions:
(i) The Administrative Agent shall have received a certificate of the
Borrower dated the First Amendment Effective Date, substantially in the
form of Exhibit B to this Amendment;
(ii) The Administrative Agent shall have received the executed legal
opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel to the
Borrower and its Subsidiaries, substantially in the form of Exhibit C to
this Amendment;
(iii) Each Subsidiary Guarantor that has not executed and delivered
this Amendment shall have entered into a written instrument substantially
in the form of Exhibit D to this Amendment pursuant to which it confirms
that it consents to this Amendment and that the Security Documents to which
it is party will continue to apply in respect of the Credit Agreement, as
amended hereby, and the Obligations thereunder;
(iv) Bear Xxxxxxx shall be satisfied that the Borrower has made the
payments referred to in Section 3(e) of this Amendment or is making such
payment on the First Amendment Effective Date with the cash proceeds of the
Term Loans C and such other funds of the Borrower as may be required; and
(v) The conditions to effectiveness of this Amendment set forth in
Section 4 shall have been satisfied.
(d) All Borrowings of Term Loans C made on the First Amendment
Effective Date will have initial Interest Periods ending on the same dates as
the Interest Periods applicable at such time to the Existing Term Loans, and the
Eurodollar Rate applicable to such Term Loans C during such initial Interest
Periods will be the same as that applicable at such time to the Existing Term
Loans being refinanced. The Borrower will not be required to make any payments
to Existing Term Loan Lenders under Section 2.15 (Computation of Interest and
Fees) of the Credit Agreement in respect of the repayment of Existing Term Loans
on the First Amendment Effective Date pursuant to their exchange for Term Loans
C.
7
(e) On the First Amendment Effective Date, the Borrower shall apply
the cash proceeds of the Term Loans C and such other amounts as may be necessary
to (i) prepay in full all Existing Term Loans (other than those that are
exchanged for Term Loans C as provided herein), (ii) pay all accrued and unpaid
interest and fees, if any, on all Existing Term Loans, (iii) pay to each
Existing Term Loan Lender all amounts payable pursuant to Section 2.15
(Computation of Interest and Fees) of the Credit Agreement as a result of the
prepayment of such Lender's Existing Term Loans (other than any portion thereof
that is exchanged for Term Loans C as provided herein) on the First Amendment
Effective Date and (iv) pay all other Obligations then due and owing to the
Existing Term Loan Lenders, in their capacity as such, under the Credit
Agreement.
(f) The Required Lenders hereby waive the requirements of Section 2.10
(Optional Prepayments) of the Credit Agreement solely to the extent that such
Section requires any notice of prepayment to be given in respect of the Existing
Term Loans to be prepaid on the First Amendment Effective Date. Notwithstanding
that the Existing Term Loans shall be refinanced in full on the First Amendment
Effective Date, the provisions of the Credit Agreement with respect to
indemnification, reimbursement of costs and expenses, increased costs and break
funding payments (other than as set forth in Section 3(d) of this Amendment)
will continue in full force and effect with respect to, and for the benefit of,
each Existing Term Loan Lender in respect of such Lender's Existing Term Loans
existing under the Credit Agreement prior to the First Amendment Effective Date.
Section 4. Effectiveness of Amendment. The effectiveness of this
Amendment and the occurrence of the First Amendment Effective Date are subject
to receipt by the Administrative Agent (or its counsel) of duly executed
counterparts of this Amendment that, when taken together, bear the signatures of
(a) the Borrower, (b) the Required Lenders and (c) each of the Continuing
Lenders and each of the Additional Lenders.
Section 5. Effect of Amendment. Except as expressly set forth herein,
this Amendment shall not by implication or otherwise limit, impair, constitute a
waiver of or otherwise affect the rights and remedies of the Lenders or the
Administrative Agent under the Credit Agreement or any other Loan Document, and
shall not alter, modify, amend or in any way affect any of the terms,
conditions, obligations, covenants or agreements contained in the Credit
Agreement or any other provision of the Credit Agreement or of any other Loan
Document, all of which are ratified and affirmed in all respects and shall
continue in full force and effect. Nothing herein shall be deemed to entitle the
Borrower to a further consent to, or a further waiver, amendment, modification
or other change of, any of the terms, conditions, obligations, covenants or
agreements contained in the Credit Agreement or any other Loan Document in
similar or different circumstances.
Section 6. Fees; Costs and Expenses. The Borrower agrees to pay to
each Lender that executes this Amendment, a fee equal to 0.10% of such Lender's
Commitment (before giving effect to Section 3(a) of this Amendment), which fee
shall be payable on the First Amendment Effective Date. The Borrower further
agrees to reimburse Bear Xxxxxxx for its reasonable out of pocket expenses in
connection with this Amendment, including the reasonable fees, charges and
disbursements of their counsel to the extent provided for in Section 10.5
(Payment of Expenses and Taxes) of the Credit Agreement.
8
Section 7. Counterparts. This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed an original, but all
such counterparts together shall constitute but one and the same instrument.
Delivery of any executed counterpart of a signature page of this Amendment by
facsimile transmission shall be as effective as delivery of a manually executed
counterpart hereof.
Section 8. Applicable Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 9. Headings. The headings of this Amendment are for purposes
of reference only and shall not limit or otherwise affect the meaning hereof.
9
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed by their respective officers as of the day and
year first above written.
ALLIED SECURITY HOLDINGS LLC
By: /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Chief Financial Officer
BEAR XXXXXXX CORPORATE LENDING INC.,
as Administrative Agent
by /s/ Xxxxxx Xxxxxxxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxxxxxxx
Title: Vice President
SIGNATURE PAGE TO
FIRST AMENDMENT
DATED AS OF MAY 10, 2005,
TO THE CREDIT AGREEMENT
DATED AS OF AUGUST 2, 2004
To approve First Amendment*:
---------------------------------- ------------------------------
Name of Institution: Name of Institution:
---------------------------------- ------------------------------
AS A CONTINUING LENDER AS AN ADDITIONAL LENDER
by________________________________ by____________________________
Name: Name:
Title: Title:
New Term Commitment:
$ -----------
------------------------------------------------------------------
Name of Institution:
----------------------------------
AS A LENDER
by_________________________________
Name:
Title:
----------------------------------- --------------------------------
*EACH LENDER MUST SIGN SEPARATELY IN EACH CAPACITY IN WHICH IT IS AGREEING TO
THE TERMS OF THIS AMENDMENT.
SCHEDULE A
TO FIRST AMENDMENT
NEW TERM LOAN COMMITMENTS
-------------------------
Continuing Lenders:
On file with Administrative Agent. $194,304,761.92
Additional Lenders:
On file with Administrative Agent. $7,695,238.08
TOTAL: $202,000,000.00
-----
