Exhibit (b)(ii)
EXECUTION COPY
AMENDMENT NO. 1
TO
CREDIT AGREEMENT
THIS AMENDMENT NO. 1 TO CREDIT AGREEMENT (the "Agreement") is
being executed and delivered as of June 6, 2003 by and among Century Business
Services, Inc., a Delaware corporation (the "Company"), each of the Guarantors
named as signatories hereto, the several financial institutions from time to
time party to the Credit Agreement referred to and defined below (collectively,
the "Lenders") and Bank of America, N.A. ("Bank of America"), as administrative
agent for the Lenders (in such capacity, the "Agent"). Undefined capitalized
terms used herein shall have the meanings ascribed to such terms in such Credit
Agreement as defined below.
W I T N E S S E T H:
WHEREAS, the Company, the Lenders and the Agent have entered
into that certain Credit Agreement dated as of September 26, 2002 (the "Credit
Agreement"), pursuant to which, among other things, the Lenders have agreed to
provide, subject to the terms and conditions contained therein, certain loans
and other financial accommodations to or for the benefit of the Company;
WHEREAS, in connection with the Credit Agreement, (i) the
Guarantors have each executed and delivered in favor of the Agent and the
Lenders a certain Guaranty pursuant to which the Guarantors have guaranteed the
Company's obligations under the Credit Agreement and (ii) the Company and each
of the Guarantors has executed and delivered a certain Pledge and Security
Agreement and other Loan Documents pursuant to which each such Person has
granted liens and security interests in substantially all of its properties as
security for its respective obligations with respect to the Credit Agreement and
the other Loan Documents; and
WHEREAS, the Company has requested that the Lenders, and
subject to the terms and conditions set forth herein, the Lenders have agreed
to, amend the Credit Agreement to, among other things, permit the repurchase by
the Company, on or before December 31, 2003, of capital stock of the Company for
aggregate consideration of up to $52,500,000.
NOW, THEREFORE, in consideration of the foregoing premises,
the terms and conditions stated herein and other valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the Company, the
Guarantors, the Lenders and the Agent, such parties hereby agree as follows:
1. Amendment. Subject to the satisfaction of each of the
conditions set forth in Paragraph 2 of this Agreement, the Credit Agreement is
hereby amended as follows (unless otherwise specified, section and schedule
references used herein shall mean and refer to sections and schedules of the
Credit Agreement):
(a) Section 1.01 is amended to:
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(i) delete in its entirety the definition of
"Borrowing Base" and replace the such definition with the
following therefor:
"`Borrowing Base' means, as of any date of
determination by the Agent, from time to time, an
amount equal to the sum at such time of:
(a) 85% of the book value of Company's
Eligible Receivables at such time; plus
(b) the lesser of (i) 60% of the book value
of Company's Eligible Unbilled
Work-in-Process and (ii) (x) 35% of the
amount calculated pursuant to clause (a) for
the months of January, February and March of
each calendar year, (y) 40% of the amount
calculated pursuant to clause (a) for the
months of April through December during
calendar year 2003 and (z) 25% of the amount
calculated pursuant to clause (a) for the
months of April through December of each
calendar year other than calendar year 2003;
provided, however, that (x) the percentages
set forth in either or both of clauses (a)
and (b)(i) above may be reduced from time to
time by the Agent in its reasonable
discretion based upon the periodic field
examinations conducted by or on the behalf
of the Agent and (y) the Agent may, in its
reasonable discretion, increase any
percentage set forth in clauses (a) or
(b)(i) above previously reduced by it
pursuant to the terms hereof provided that
such percentage is not increased to a
percentage greater than the applicable
percentage set forth above; and
provided further, however, that if (x) on
such date of determination the Availability
would, without giving effect to this
proviso, be less than zero after giving
effect to all Borrowings requested pursuant
to Section 2.03(a) on such date and all
prepayments of Loans made on such date, (y)
such date of determination is the first date
on which the occurrence described in the
foregoing clause (x) has occurred during the
current month, or the occurrence described
in the foregoing clause (x) has occurred
during the current month and on one of the
nine consecutive Business Days immediately
preceding such date and (z) such date of
determination is on or before December 31,
2003 and is not the last Business Day of any
calendar month, then the Borrowing Base with
respect to such date of determination shall
be the sum of (1) the Borrowing Base with
respect to such date calculated without
giving effect to this proviso plus (2)
$5,000,000."
(ii) delete from the definition of "Interest Period"
the phrase "(if such seven day period ends on or before
October 28, 2002)," set forth therein and replace the
following therefor: "or";
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(iii) delete from clause (9) of the definition of
"Permitted Acquisition" the phrase "prior to such Acquisition"
set forth therein and replace the following therefor:
"prior to any Acquisition with respect to which the
sum of the Cash Consideration and non-cash
consideration paid by the Company and the amount of
Indebtedness assumed by the Company in connection
therewith exceeds $5,000,000,"; and
(v) delete in its entirety the definition of
"Tangible Net Worth".
(b) Section 8.10 is amended to delete clause (i) from the
proviso therein and replace the following therefor:
"(i) that (x) with respect to the period from June 6,
2003 through December 31, 2003, the amount of such
redemptions and repurchases during such period does
not exceed $52,500,000 and (y) at all times
thereafter, the amount of such redemptions and
repurchases does not exceed an amount equal to fifty
percent (50%) of Net Income for the twelve (12) month
period then most recently ended and with respect to
the last month of such period the Agent and the
Lenders shall have received the monthly financial
information required pursuant to Section 7.01(c),".
(c) Section 8.14 is deleted in its entirety and the following
is replaced therefor:
"8.14 Minimum Net Worth. The Company shall
not permit its consolidated Net Worth at any time
after June 1, 2003 to be less than an amount equal to
the sum of (a) $260,000,000 plus (b) 50% of the
Company's positive net income as determined in
accordance with GAAP (with no deduction for net
losses), if any, for each fiscal quarter ending after
June 1, 2003 and prior to any date of determination
hereunder plus (c) an amount equal to 100% of the net
cash and non-cash proceeds of any equity securities
issued by the Company or its Subsidiaries after June
1, 2003 and prior to any date of determination
hereunder less (d) an amount not exceeding
$52,500,000 in the aggregate paid by the Company for
any shares of capital stock of the Company
repurchased or redeemed during the period from June
6, 2003 through December 31, 2003."
2. Effectiveness of this Agreement; Conditions Precedent. The
provisions of Paragraph 1 of this Agreement shall be deemed to have become
effective as of the date of this Agreement, but such effectiveness shall be
expressly conditioned upon the occurrence of each of the following:
(a) receipt by the Agent of an originally-executed counterpart
of this Agreement executed and delivered by duly authorized officers of
the Company, each Guarantor and the Majority Lenders; and
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(b) payment in full, in immediately available funds, of (i)
the fee payable to each Lender who executes this Agreement in the
amount of 0.10% of such Lender's Revolving Loan Commitment and (ii) the
fees payable to Bank of America pursuant to that certain fee letter
dated as of June 6, 2003 among Bank of America, Banc of America
Securities LLC and the Company.
3. Representations and Warranties.
(a) The Company hereby represents and warrants that this
Agreement and the Credit Agreement as amended by this Agreement
constitute the legal, valid and binding obligations of the Company
enforceable against the Company in accordance with their terms.
(b) The Company hereby represents and warrants that its
execution, delivery and performance of this Agreement and the Credit
Agreement as amended by this Agreement have been duly authorized by all
proper corporate action, do not violate any provision of its
certificate of incorporation or bylaws, will not violate any law,
regulation, court order or writ applicable to it, and will not require
the approval or consent of any Governmental Authority, or of any other
third party under the terms of any contract or agreement to which the
Company or any of the Company's Subsidiaries is bound.
(c) The Company hereby represents and warrants that, after
giving effect to the provisions of this Agreement, (i) no Default or
Event of Default has occurred and is continuing or will have occurred
and be continuing and (ii) all of the representations and warranties of
the Company contained in the Credit Agreement and in each other Loan
Document (other than representations and warranties which, in
accordance with their express terms, are made only as of an earlier
specified date) are, and will be, true and correct as of the date of
the Company's execution and delivery of this Agreement in all material
respects as though made on and as of such date.
(d) The Company hereby represents and warrants that there has
occurred since December 31, 2002, no event or circumstance that has
resulted or could reasonably be expected to result in a Material
Adverse Effect.
(e) The Company hereby represents and warrants that there are
no actions, suits, investigations, proceedings, claims or disputes
pending, or to the best knowledge of the Company, threatened or
contemplated, at law, in equity, in arbitration or before any
Governmental Authority, against the Company, its Subsidiaries or any of
their respective properties which purport to affect or pertain to this
Agreement, the Credit Agreement or any other Loan Document or any of
the transactions contemplated hereby or thereby, or which could
reasonably be expected to have a Material Adverse Effect
4. Reaffirmation, Ratification and Acknowledgment;
Reservation. The Company and each Guarantor hereby (a) ratifies and reaffirms
all of its payment and performance obligations, contingent or otherwise, and
each grant of security interests and liens in favor of the Agent, under each
Loan Document to which it is a party, (b) agrees and acknowledges that such
ratification and reaffirmation is not a condition to the continued
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effectiveness of such Loan Documents, and (c) agrees that neither such
ratification and reaffirmation, nor the Agent's or any Lender's solicitation of
such ratification and reaffirmation, constitutes a course of dealing giving rise
to any obligation or condition requiring a similar or any other ratification or
reaffirmation from the Company or such Guarantors with respect to any subsequent
modifications to the Credit Agreement or the other Loan Documents. The Credit
Agreement is in all respects ratified and confirmed. Each of the Loan Documents
shall remain in full force and effect and is hereby ratified and confirmed.
Neither the execution, delivery nor effectiveness of this Agreement shall
operate as a waiver of any right, power or remedy of the Agent or the Lenders,
or of any Default or Event of Default (whether or not known to the Agent or the
Lenders), under any of the Loan Documents, all of which rights, powers and
remedies, with respect to any such Default or Event of Default or otherwise, are
hereby expressly reserved by the Agent and the Lenders. This Agreement shall
constitute a Loan Document for purposes of the Credit Agreement.
5. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED THAT
THE PARTIES SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
6. Agent's Expenses. The Company hereby agrees to promptly
reimburse the Agent for all of the reasonable out-of-pocket expenses, including,
without limitation, attorneys' and paralegals' fees, it has heretofore or
hereafter incurred or incurs in connection with the preparation, negotiation and
execution of this Agreement.
7. Counterparts. This Agreement may be executed in
counterparts, each of which shall be an original and all of which together shall
constitute one and the same agreement among the parties.
* * * *
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
CENTURY BUSINESS SERVICES, INC.
By
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Name:
Title:
Signature Page to
Amendment No. 1 to Credit Agreement
Page 1 of 9
THE GUARANTORS: AH BUSINESS SERVICES, INC.
BA BUSINESS SERVICES, INC.
BBGPR, LLC
BCC BUSINESS SERVICES, INC.
XXXXXX XXXXXXXX BUSINESS SERVICES, INC.
BENMARK, INC.
BGS&G INSURANCE SERVICES COMPANY
BROKER BENEFIT CONSULTANTS BUSINESS SERVICES, INC.
BVKT BUSINESS SERVICES, INC.
CBIZ ACTUARIAL & BENEFIT CONSULTANTS, INC.
CBIZ BENEFITS & INSURANCE SERVICES OF MARYLAND, INC.
CBIZ BENEFITS & INSURANCE SERVICES OF OHIO, INC.
CBIZ BENEFITS & INSURANCE SERVICES OF PENNSYLVANIA, INC.
CBIZ BENEFITS & INSURANCE SERVICES, INC.
CBIZ BUSINESS SOLUTIONS, INC.
CBIZ BUSINESS SOLUTIONS OF CLEVELAND, INC.
CBIZ BUSINESS SOLUTIONS OF NORTHEAST OHIO, INC.
CBIZ BUSINESS SOLUTIONS OF ST. LOUIS, INC.
CBIZ COLORADO, INC.
CBIZ HEALTHCARE SOLUTIONS GROUP, INC.
CBIZ INSTITUTIONAL BENEFIT SERVICES, INC.
Signature Page to
Amendment No. 1 to Credit Agreement
Page 2 of 9
CBIZ INSURANCE AGENCY, INC.
CBIZ PROPERTY TAX SOLUTIONS, INC.
CBIZ RESTRUCTURING GROUP, INC.
CBIZ RETIREMENT SERVICES, INC.
CBIZ SOUTHERN CALIFORNIA, INC.
CBIZ SPECIAL RISK INSURANCE SERVICE, INC.
CBIZ TECHNOLOGIES, INC.
CBIZ TRILINC CONSULTING, INC.
0CBIZ VALUATION GROUP, INC.
CBIZ VINE STREET HOLDING CORP.
CBIZ WELFARE BENEFITS, INC.
CBIZ WORKSITE SERVICES, INC.
CENTURY SURETY UNDERWRITERS, INC.
CMG CONSULTING, INC.
COMMERCIAL SURETY AGENCY, INC.
XXXXXX BUSINESS SERVICES, INC.
DP & CO. BUSINESS SERVICES, INC.
FPG BUSINESS SERVICES, INC.
GIBRALTAR REAL ESTATE SERVICES CORPORATION
XXXXXX, ZUCARELLI & XXXXXXX BUSINESS SERVICES, INC.
GOVERNMENT EMPLOYEE BENEFITS CORPORATION OF GEORGIA
HEALTH ADMINISTRATION SERVICES, INC.
XXXX & ASSOCIATES BUSINESS SERVICES, INC.
Signature Page to
Amendment No. 1 to Credit Agreement
Page 3 of 9
KA CONSULTING SERVICES, INC.
XXXXXXX HEALTH CARE CONSULTING, INC.
XXXXXXX XXXXX BUSINESS SERVICES, INC.
XXXXXXX & ASSOCIATES BUSINESS SERVICES, INC.
M & S CONSULTING SERVICES, INC.
XXXXXXX & COMPANY BUSINESS SERVICES, INC.
MEDICAL MANAGEMENT PROFESSIONALS, INC.
MHM BUSINESS SERVICES, INC.
XXXXXX, XXXXXX BUSINESS SERVICES, INC.
XXXXX, XXXXX & COMPANY, INC.
MRC BUSINESS SERVICES, INC.
M.T. XXXXXXX & ASSOCIATES, INC.
XXXXXXX, XXXXX BUSINESS SERVICES, INC.
PDA BUSINESS SERVICES, INC.
XXXXXX-XXX BUSINESS SERVICES, INC.
XXXXXXXXX, XXXXX BUSINESS SERVICES, INC.
ROOTBERG BUSINESS SERVICES, INC.
RRSS & COMPANY BUSINESS SERVICES, INC.
S & B BUSINESS SERVICES, INC.
SHILLING & XXXXXX/SK CONSULTING, INC.
SK&B BUSINESS SERVICES, INC.
SR BUSINESS SERVICES, INC.
SRTDA BUSINESS SERVICES, INC.
Signature Page to
Amendment No. 1 to Credit Agreement
Page 4 of 9
TRI-TEK BUSINESS SERVICES, INC.
CBIZ BUSINESS SOLUTIONS OF TAMPA BAY, INC.
CBSI MANAGEMENT CO.
CENTURY RISK SERVICES COMPANY
COMPETITIVE TECHNOLOGIES BUSINESS SERVICES, INC.
CONNECTICUT ESCROW, INC.
CONTRACT SURETY REINSURANCE CORP.
CSU OF ARIZONA, INC.
XXXX AGENCY, INC.
FUNDS ADMINISTRATION SERVICES, INC.
G & C BUSINESS SERVICES, INC.
MRP BUSINESS SOLUTIONS GROUP, INC.
NEXT RISK MANAGEMENT, INC.
SLW BUSINESS SERVICES, INC.
SURETY ASSOCIATES, INC.
XXXXXX BUSINESS SERVICES, INC.
WC & M BUSINESS SERVICES, INC.
By:__________________________________
Name: Xxxxxx X. Xxxxxx, Xx.
Title: President
Signature Page to
Amendment No. 1 to Credit Agreement
Page 5 of 9
BANK OF AMERICA, N.A., AS AGENT
By
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Name:
Title:
BANK OF AMERICA, N.A., INDIVIDUALLY AS A LENDER
By
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Name:
Title:
Signature Page to
Amendment No. 1 to Credit Agreement
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FIFTH THIRD BANK
By
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Name:
Title:
Signature Page to
Amendment No. 1 to Credit Agreement
Page 7 of 9
HUNTINGTON NATIONAL BANK
By
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Name:
Title:
Signature Page to
Amendment No. 1 to Credit Agreement
Page 8 of 9
U.S. BANK, N.A.
By
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Name:
Title:
Signature Page to
Amendment No. 1 to Credit Agreement
Page 9 of 9