Exhibit 10.14
FIRST AMENDMENT
TO SECOND AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
First Amendment dated as of March 26, 2004 to Second Amended and Restated
Revolving Credit Agreement (the "First Amendment"), by and among ANACOMP, INC.,
an Indiana corporation (the "Borrower"), FLEET NATIONAL BANK and the other
lending institutions listed on Annex A to the Credit Agreement (as hereinafter
defined) (the "Banks"), amending certain provisions of the Second Amended and
Restated Revolving Credit Agreement dated as of November 21, 2003 (as amended
and in effect from time to time, the "Credit Agreement") by and among the
Borrower, the Banks and Fleet National Bank as agent for the Banks (the
"Agent"). Terms not otherwise defined herein which are defined in the Credit
Agreement shall have the same respective meanings herein as therein.
WHEREAS, the Borrower and the Banks have agreed to modify certain terms and
conditions of the Credit Agreement as specifically set forth in this First
Amendment;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ss.1.Amendment to Section 1.1 of the Credit Agreement. Section 1.1 of the
Credit Agreement is hereby amended as follows:
(a) The definition of "Borrowing Base Availability" is hereby amended by
deleting the words "exceeds the Total Borrowing Base Outstandings" which appear
in such definition and substituting in place thereof the words "exceeds the
Total Outstandings".
(b) The definition of "Consolidated EBITDA" is hereby amended by deleting
such definition in its entirety and restating it as follows:
Consolidated EBITDA. With respect to the Borrower and its Subsidiaries
for any fiscal period, an amount equal to Consolidated Net Income for such
period, plus to the extent deducted in the calculation of Consolidated Net
Income and without duplication, (a) depreciation and amortization for such
period, (b) other noncash charges for such period which are reasonably
acceptable to the Agent, (c) the noncash compensation expense of the
Borrower for such period relating to the Borrower issuing shares of its
Capital Stock to employees in connection with an employee compensation
plan, (d) solely for purposes of calculating compliance with the financial
covenant set forth in ss.10.1 hereof and solely with respect to the period
of March 1, 2004 through and including December 31, 2004, the restructuring
charges taken during the applicable period in connection with the closing
of certain of the Borrower's data centers, in an aggregate amount not to
exceed $8,000,000, (e) income tax expense for such period, and (f)
Consolidated Total Interest Expense paid or accrued during such period, and
minus, to the extent added in computing Consolidated Net Income and without
duplication, all noncash gains (including income tax benefits) for such
period, all as determined in accordance with Generally Accepted Accounting
Principles. For the avoidance of doubt, the restructuring charge described
in subparagraph (d) of this definition shall only be added back to the
calculation of the EBITDA for the sole purpose of calculating compliance
with the financial covenant contained in ss.10.1 hereof, and shall not be
included in any other computation of EBITDA hereunder.
(c) The definition of "Revolving Credit Loans" is hereby amended by
deleting the words "(including, without limitation, all or any portion of a
Revolving Credit Loan which constitutes an Overadvance Amount)" from such
definition.
(d) Section 1.1 of the Credit Agreement is further amended by deleting the
definitions of "Consolidated EBT", "Consolidated Operating Cash Flow",
"Individual Overadvance Amount", "Overadvance Amount" and "Total Borrowing Base
Outstandings" in their entirety.
ss.2.Amendment to Section 2 of the Credit Agreement. Section 2 of the
Credit Agreement is hereby amended as follows:
(a) Section 2.1 of the Credit Agreement is hereby amended by deleting the
comma and the words "provided, further, notwithstanding the foregoing proviso,
to the extent the Borrower is requesting a Revolving Credit Loan to fund all or
a portion of a Permitted Acquisition, then the sum of the outstanding amount of
the Revolving Credit Loans (after giving effect to all amounts requested) plus
the Maximum Drawing Amount and all Unpaid Reimbursement Obligations shall not at
any time exceed the lesser of (i) the Total Commitment at such time and (ii) the
Borrowing Base at such time plus the Overadvance Amount at such time" which
appear at the end of the first sentence of ss.2.1.
(b) Section 2.5(a) of the Credit Agreement is hereby amended by deleting
the words "and, in addition, to the extent any Overadvance Amount is
outstanding, that portion of the Revolving Credit Loans which are Base Rate
Loans and which constitute an Overadvance Amount shall bear interest for the
period commencing on the Drawdown Date thereof and ending on the last day of the
Interest Period with respect thereto at the rate of one and one half percent (1
1/2%) per annum above the Base Rate" which appear in ss.2.5(a).
(c) Section 2.5(b) of the Credit Agreement is hereby amended by deleting
the words " and, in addition, to the extent any Overadvance Amount is
outstanding, that portion of the Revolving Credit Loans which are LIBOR Rate
Loans and which constitute an Overadvance Amount shall bear interest for the
period commencing on the Drawdown Date thereof and ending on the last day of the
Interest Period with respect thereto at the rate of three and one half percent
(3 1/2%) per annum above the LIBOR Rate determined for such Interest Period"
which appear in ss.2.5(b).
(d) Section 2.6 of the Credit Agreement is hereby amended by deleting the
comma and the words "if any and, which portion of the Revolving Credit Loan
being requested constitutes an Individual Overadvance Amount (if any). To the
extent the Borrower fails to identify whether all or any portion of the
requested Revolving Credit Loan is to be an Individual Overadvance Amount, such
requested Revolving Credit Loan shall not be considered an Individual
Overadvance Amount." which appear in ss.2.6.
ss.3.Amendment to Section 3 of the Credit Agreement. Section 3 of the
Credit Agreement is hereby amended as follows:
(a) Section 3.1 of the Credit Agreement is hereby amended by deleting the
second sentence of ss.3.1 in its entirety.
(b) Section 3.2.1 of the Credit Agreement is hereby amended by deleting the
words "(or, to the extent the Borrower had previously utilized any portion of
the Overadvance Amount, then the Borrowing Base at such time plus the
Overadvance Amount outstanding at such time)" which appear in the first sentence
of ss.3.2.1.
(c) Section 3.2.3 of the Credit Agreement is hereby amended by deleting the
words "(with the Overadvance Amount being reduced first, and after the
Overadvance Amount has been reduced to $0, to the other Revolving Credit Loans)"
which appear in ss.3.2.3.
ss.4.Amendment to Section 4 of the Credit Agreement. Section 4.1.1 of the
Credit Agreement is hereby amended by deleting the words "(or, to the extent the
Borrower had previously utilized any portion of the Overadvance Amount, then the
Borrowing Base at such time plus the Overadvance Amount outstanding at such
time)" which appear at the end of the text of ss.4.1.1.
ss.5.Amendment to Section 8 of the Credit Agreement. Section 8.9.2 of the
Credit Agreement is hereby amended by deleting ss.8.9.2 in its entirety and
restating it as follows:
8.9.2. Collateral Reports. No more frequently than once during each
calendar quarter, commencing with the calendar quarter ending March 31,
2004, or more frequently as determined by the Agent if an Event of Default
shall have occurred and be continuing, upon the request of the Agent, the
Borrower will obtain and deliver to the Agent, or, if the Agent so elects,
will cooperate with the Agent in the Agent's obtaining, a report of an
independent collateral auditor satisfactory to the Agent (which may be
affiliated with one of the Banks) with respect to the Accounts included in
the Borrowing Base, which report shall indicate whether or not the
information set forth in the Borrowing Base Report most recently delivered
is accurate and complete in all material respects based upon a review by
such auditors of the Accounts (including verification with respect to the
amount, aging, identity and credit of the respective Account Debtors and
the billing practices of the Borrower or its applicable Subsidiary). All
such collateral value reports shall be conducted and made at the expense of
the Borrower.
ss.6.Amendment to Section 9 of the Credit Agreement. Section 9 of the
Credit Agreement is hereby amended as follows:
(a) Section 9.1(c) of the Credit Agreement is hereby amended by deleting
the amount "$5,000,000" which appears in ss.9.1(c) and substituting in place
thereof the amount "$2,500,000".
(b) Section 9.1(i) of the Credit Agreement is hereby amended by deleting
the amount "$5,000,000" which appears in ss.9.1(i) and substituting in place
thereof the amount "$2,500,000".
(c) Section 9.4 of the Credit Agreement is hereby amended by deleting
ss.9.4 of the Credit Agreement in its entirety and restating it as follows:
9.4. Restricted Payments. The Borrower will not make any Restricted
Payments; provided, however, (a) any Subsidiary shall be permitted to make
a Restricted Payment to the Borrower or any Guarantor; and (b) so long as
no Default or Event of Default has occurred and is continuing, (i) the
Borrower shall be permitted to repurchase shares of its Series B common
stock from the holders thereof for fair market value so long as the
aggregate consideration paid by the Borrower for all such repurchases does
not exceed $120,000 in the aggregate and all such repurchases are
consummated by not later than December 31, 2004; and (ii) in addition to
the repurchase permitted by ss.9.4(b)(i) hereof, the Borrower may also
request that the Banks consent to the Borrower repurchasing a portion of
its issued and outstanding Capital Stock (with the Borrower agreeing to
provide the Agent and the Banks a written request detailing the number of
shares to be repurchased, the date of such repurchase, the aggregate amount
of consideration to be paid by the Borrower in connection with such
repurchase and whether the Borrower intends to retire any Capital Stock so
repurchased), and the Agent hereby agrees to promptly notify the Borrower
whether such consent has been granted by the Majority Banks, provided
nothing contained in this ss.9.4(b)(ii) shall obligate any Bank to consent
to such request.
(d) Section 9.5.1(ix) of the Credit Agreement is hereby amended by (i)
deleting the amount "$5,000,000" which appears in ss.9.5.1(ix) and substituting
in place thereof the amount "$2,500,000"; and (ii) deleting the amount
"$10,000,000" which appears in ss.9.5.1(ix) and substituting in place thereof
the amount "$5,000,000".
ss.7.Amendment to Section 10 of the Credit Agreement. Section 10 of the
Credit Agreement is hereby amended as follows:
(a) Section 10.1 of the Credit Agreement is hereby amended by deleting
ss.10.1 in its entirety and restating it as follows:
10.1. Mimimum EBITDA. The Borrower will not permit Consolidated EBITDA
at the end of any fiscal quarter set forth in the table below to be less
than the amount set forth opposite such period in such table:
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Fiscal Quarter Ending Minimum Consolidated EBITDA
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March 31, 2004 $3,500,000
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June 30, 2004 $3,200,000
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September 30, 2004 $4,500,000
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December 31, 2004 and each $3,000,000
fiscal quarter ending thereafter
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(b) Section 10.2 of the Credit Agreement is hereby amended by deleting the
amount "$7,500,000" which appears in ss.10.2 and substituting in place thereof
the amount "$6,500,000".
(c) Section 10.3 of the Credit Agreement is hereby amended by deleting
ss.10.3 in its entirety and restating it as follows:
10.3. Restructuring Charge. The Borrower will not permit the
restructuring charge taken during the period of March 1, 2004 through and
including December 31, 2004 in connection with the closing of certain of
its data centers to exceed $8,000,000 in the aggregate, and such charge
shall be taken only during the period of March 1, 2004 through and
including December 31, 2004 (but not at any time thereafter).
ss.8.Amendment to Section 12. Section 12 of the Credit Agreement is hereby
amended as follows:
(a) The first sentence of Section 12 is hereby amended by inserting
immediately after the words "to make any Revolving Credit Loan" a comma and the
words "and to continue and/or convert any Revolving Credit Loan in accordance
with ss.2.7 hereof".
(b) Section 12.1 of the Credit Agreement is hereby amended by inserting
immediately after the words "as of the time of the making of such Revolving
Credit Loan" which appear in the first sentence thereof a comma and the words ",
the continuation and/or conversion of any Revolving Credit Loan in accordance
with ss.2.7 hereof".
ss.9.Amendment to Annex A. Annex A of the Credit Agreement is hereby
amended by deleting Annex A in its entirety and replacing it with the Annex A
attached hereto.
ss.10. Conditions to Effectiveness. This First Amendment shall not become
effective until the Agent receives the following:
(a) a counterpart of this First Amendment, executed by the Borrower and the
Banks;
(b) payment in cash of an amendment fee of $15,000 for each Bank; and
(c) payment in cash of an administrative fee of $10,000 for the Agent's own
account.
ss.11. Representations and Warranties. The Borrower hereby represents that,
on and as of the date hereof, each of the representations and warranties made by
it in ss.7 of the Credit Agreement remain true as of the date hereof (except to
the extent of changes resulting from transactions contemplated or permitted by
the Credit Agreement and the other Loan Documents and changes occurring in the
ordinary course of business that singly or in the aggregate are not materially
adverse, and to the extent that such representations and warranties relate
expressly to an earlier date), provided, that all references therein to the
Credit Agreement shall refer to such Credit Agreement as amended hereby. In
addition, the Borrower hereby represents and warrants that the execution and
delivery by the Borrower of this First Amendment and the performance by the
Borrower of all of its agreements and obligations under the Credit Agreement as
amended hereby are within the corporate authority of each of the Borrower and
has been duly authorized by all necessary corporate action on the part of the
Borrower.
ss.12. Ratification, Etc. Except as expressly amended hereby, the Credit
Agreement and all documents, instruments and agreements related thereto,
including, but not limited to the Security Documents, are hereby ratified and
confirmed in all respects and shall continue in full force and effect. The
Credit Agreement and this First Amendment shall be read and construed as a
single agreement. All references in the Credit Agreement or any related
agreement or instrument to the Credit Agreement shall hereafter refer to the
Credit Agreement as amended hereby.
ss.13. No Waiver. Nothing contained herein shall constitute a waiver of,
impair or otherwise affect any Obligations, any other obligation of the Borrower
or any rights of the Agent or the Banks consequent thereon.
ss.14. Counterparts. This First Amendment may be executed in one or more
counterparts, each of which shall be deemed an original but which together shall
constitute one and the same instrument.
ss.15. Governing Law. THIS FIRST AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS
(WITHOUT REFERENCE TO CONFLICT OF LAWS).
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
as a document under seal as of the date first above written.
ANACOMP, INC.
By:/s/▇▇▇▇▇▇▇ ▇. ▇▇▇
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Title: EVP / CFO
FLEET NATIONAL BANK
By:/s/▇▇▇▇ ▇▇▇▇
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Title: Managing Director
UNION BANK OF CALIFORNIA, N.A.
By:/s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: Vice President/SCM
Annex A
Banks/Commitments
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Commitment
Banks Commitment Percentage
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Fleet National Bank $10,000,000.00 57.142857%
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Technology & Communications
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇, Managing Director
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
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Union Bank of California, N.A. $7,500,000.00 42.857143%
▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
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Totals $17,500,000.00 100%
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