EXHIBIT 10
FOURTH AMENDMENT TO NOTE AGREEMENT
Reference is hereby made to that Note Agreement dated as of May 31,
1991 (the 'Original Agreement'), as amended by that First Amendment to Note
Agreement dated as of February 28, 1992 (the 'First Amendment'), that Second
Amendment to Note Agreement dated as of March 25, 1992 (the 'Second Amendment)
and that Third Amendment to Note Agreement dated as of December 1, 1992 (the
'Third Agreement') (as amended by the First Amendment, the Second Amendment and
the Third Amendment, the 'Agreement'), between ▇▇▇▇▇▇ ▇▇▇▇▇▇ International Inc.
(the 'Company'), Allstate Life Insurance Company, Monumental Life Insurance
Company, and PFL Life Insurance Company (collectively, the 'Purchasers'). This
Fourth Amendment to Note Agreement is hereinafter referred to as the 'Fourth
Amendment'.
WHEREAS, the Company has advised the Purchasers that it has not
complied with the covenant set forth in Section 7.4 of the Agreement as of the
fiscal quarters ending February 28, 1995 and May 31, 1995 and that it
anticipates that it will not comply with such covenant until the fiscal quarter
ending August 31, 1996; and
WHEREAS, the Company has requested that the Purchasers agree to certain
amendments with respect to Section 7.4 of the Agreement; and
WHEREAS, the Purchasers have requested certain additional amendments to
the Agreement as consideration for the aforesaid amendments.
It is therefore agreed that:
1. Definitions.
All defined terms used herein shall have the meanings assigned to such
terms in the Agreement.
2. Amendments.
The following amendments are effective from February 28, 1995 through
and including May 31, 1996. The Purchasers and the Company hereby amend the
Agreement as follows:
(a) Section 1.1 of the Agreement is amended by deleting such
paragraph in its entirety and inserting in lieu thereof the following:
'Section 1.1 Description of Notes.
(a) The Company has authorized the issuance and
sale of $30,000,000 aggregate principal amount of its Senior
Notes (the 'Notes'), to be dated the date of issuance, to bear
interest from such date at the rate of 9.97% per annum prior
to maturity (the 'Original Interest Rate'), payable
semi-annually on the fifteenth day of May and November of
each year, commencing November 15, 1991, and at maturity, to
bear interest on overdue principal (including any overdue
required or optional prepayment), premium, if any, and (to
the extent legally enforceable) on any overdue installment of
interest at the rate of 10.97% per annum (the 'Original
Overdue Rate'), to be expressed to mature on May 15, 2001 and
to be substantially in the form attached as Exhibit A. The
term 'Notes' as used herein shall include each Note delivered
pursuant to this Note Agreement (the 'Agreement') and each
note delivered in substitution or exchange thereof and, where
applicable, shall include the singular numbers as well as the
plural. Any reference to you in this Agreement shall in all
instances be deemed to include any nominee of yours or any
separate account or other person on whose behalf you are
purchasing Notes. You are sometime referred to herein as the
'Purchaser' and, together with the other Purchasers, as the
'Purchasers'.
(b) Notwithstanding the foregoing paragraph (a), the
Company agrees that the Notes shall, commencing March 1, 1995
through and including May 31, 1996, bear interest from and to
and including such dates at the rate of 10.97% per annum
prior to maturity (the 'Increased Interest Rate'), payable
semi-annually on the fifteenth day of May and November of
each year, and shall bear interest on overdue principal
(including any overdue required or optional prepayment),
premium, if any, and (to the extent legally enforceable) on
any overdue installment of interest at the rate of 11.97% per
annum.'
(b) Section 7.4 of the Original Agreement is amended by deleting such
Section in its entirety and inserting in lieu thereof the following:
'Section 7.4 Consolidated Fixed Charge Ratio. (a)
For the fiscal quarter ending February 28, 1995, and for the
fiscal quarter ending May 31, 1995, the Company shall not be
required to meet the requirements of Section 7.4 of the
Original Agreement.
(b) The Company will not permit the ratio of
Consolidated Income Available for Fixed Charges to
Consolidated Fixed Charges to be less than: (A) 1.25 to 1.0
for the three month period ending August 31, 1995, (B) 1.30
to 1.0 for the six month period ending November 30, 1995; (C)
1.30 to 1.0 for the nine month period ending February 29,
1996 and (D) 1.30 to 1.0 for the twelve month period ending
May 31, 1996.'
3. Representations and Warranties.
In order to induce the Purchasers to enter into this Fourth Amendment
to Note Agreement,
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the Company confirms that, except as disclosed in the Form 10-Q of the Company
for the quarter ended February 28, 1995, the press release of the Company
summarizing financial results for the Company's fiscal year ended May 31, 1995
and correspondence from the Company dated May 26, 1995 and June 5, 1995,
including certain financial projections, each of the representations and
warranties set forth in the Original Agreement is true and correct as of the
date hereof and that no Event of Default (which has not been cured pursuant to
amendments made hereunder) has occurred and is continuing.
4. Interest Payment.
The Company agrees to pay by wire transfer on September 5, 1995
interest equal to the difference between the Increased Interest Rate and the
Original Interest Rate accrued from and including March 1, 1995 (but not
including) May 15, 1995.
5. Anticipated Amendment.
In connection with a fifth amendment to this Agreement which the
parties hereto will use good faith efforts to execute by October 31, 1995 (the
'Fifth Amendment'):
(a) The Purchasers agree that (i) if the Company has, since
the date hereof, been in compliance with all the covenants, terms and conditions
of the Agreement, as amended hereby and (ii) if no material adverse change has
occurred since the date hereof in the condition, financial or otherwise, of the
Company and its Subsidiaries, then the interest rate payable on the Notes shall
not, for the period commencing March 1, 1995 and ending June 1, 1996, as a
result of the Fifth Amendment, be in excess of 10.97% per annum and no fees
(other than fees and expenses of counsel to the Purchasers) will be required by
the Purchasers in connection with the Fifth Amendment; and
(b) the Company agrees to issue a replacement note to reflect
interest rate changes resulting from the Fourth and Fifth Amendments.
6. Counterparts.
This Fourth Amendment to Note Agreement may be executed by the parties
hereto individually, or in any combination of the parties hereto in several
counterparts, all of which taken together shall constitute one and the same
Fourth Amendment to Note Agreement.
7. Ratification and Acknowledgement.
All of the representations, warranties, provisions, covenants, terms
and conditions of the Agreement shall remain unaltered and in full force and
effect and, as amended hereby, the Agreement is in all respects agreed to,
ratified and confirmed by the Company. The Company
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acknowledges and agrees that the amendments granted herein shall not be
construed as establishing a course of conduct on the part of the Purchasers
upon which the Company may rely at any time in the future.
8. Reference to and Effect on the Agreement.
Upon the effectiveness of this Fourth Amendment to Note Agreement, each
reference in the Agreement and in other documents describing or referencing this
Agreement to 'this Agreement', 'hereunder', 'hereof', 'herein', or words of like
import referring to the Agreement, shall mean and be a reference to the
Agreement, as amended hereby.
Dated as of this 25th day of August, 1995.
▇▇▇▇▇▇ ▇▇▇▇▇▇ INTERNATIONAL INC.
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Its:
ALLSTATE LIFE INSURANCE COMPANY
By:/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Its: Authorized Signatory
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Its: Authorized Signatory
MONUMENTAL LIFE INSURANCE COMPANY
By:/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Its: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
PFL LIFE INSURANCE COMPANY
By:/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Its: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
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