Exhibit 4.1.2
AMENDMENT NO. 1 TO
PREFERRED STOCK AND WARRANT PURCHASE AGREEMENT
AMENDMENT NO. 1 (this "Amendment No. 1") dated as of January 7, 2003, to
the Preferred Stock and Warrant Purchase Agreement dated as of December 26, 2002
(the "Purchase Agreement"), by and among Numatics, Incorporated, a Michigan
corporation (the "Company"), ▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇"), and Numat, LLC, a
Delaware limited liability company (the "Purchaser").
W I T N E S S E T H:
WHEREAS, the Company, ▇▇▇▇▇▇ and the Purchaser are parties to the
Purchase Agreement;
WHEREAS, the Company, ▇▇▇▇▇▇ and the Purchaser desire to amend the
Purchase Agreement as set forth herein; and
WHEREAS, terms used herein but not otherwise defined shall have the
respective meanings ascribed thereto in the Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:
1. Amendments to the Purchase Agreement.
1.1 Section 1(a) of the Purchase Agreement and Section 10 of the
Certificate of Designations each is hereby amended by adding the following new
definition thereto:
"Loan and Security Agreement" shall mean that certain Loan and
Security Agreement, dated as of January 6, 2003 (as the same may be
amended, supplemented, restated, waived, modified, refinanced or replaced
from time to time (including any successive amendments, supplements,
restatements, waivers, modifications, refinancings or replacements
thereof, whether with the original agent and lenders or another agent or
agents or other lenders)), by and among the Company, each of the
Company's Subsidiaries identified on the signature pages thereof, the
lenders identified on the signature pages thereof (such lenders, together
with their respective successors and assigns, the "Lenders"), and
Foothill Capital Corporation, as the arranger and administrative agent
for the Lenders (in such capacity, the "Agent").
1.2 Section 2.4(a) of the Purchase Agreement is hereby amended and
restated in its entirety to read as follows:
(a) Closing Date; Termination. The closing shall take place on
January 31, 2003, or such later date as of which the condition set forth
in Section 6.8 is satisfied, provided, however, that in the event that
the Closing does not occur on or before February 14, 2003, this Agreement
shall terminate, and the funds deposited pursuant to the Escrow
Agreement by the Purchaser, plus all interest accrued thereon, shall be
returned by the Escrow Agent to the Purchaser.
1.3 Section 2.6(a) of the Purchase Agreement is hereby amended by
adding the following proviso at the end of the second sentence thereof:
; provided, that the aggregate amount payable by the Company in respect
of the reacquisition of such Warrant Securities shall not exceed $25,000.
1.4 Section 2.6(b) of the Purchase Agreement is hereby amended by
adding the following sentence at the end thereof:
Notwithstanding anything to the contrary contained in this Agreement, any
other Transaction Document, or any agreement, instrument or other
document delivered in connection herewith or therewith, but subject to
the last sentence of this Section 2.6(b), all amounts payable by the
Company to the Purchaser in respect of a sale or other transfer of
Warrant Securities by the Purchaser to the Company pursuant to this
Section 2.6(b) shall be subordinated to the prior payment in full of the
Obligations (as defined in the Loan and Security Agreement) arising under
the Loan and Security Agreement or any other Loan Document (as defined in
the Loan and Security Agreement) and the cancellation or cash
collateralization of all Letters of Credit (as defined in the Loan and
Security Agreement) in accordance with the subordination provisions of
Exhibit E hereto. Nothing in this Section 2.6(b), however, shall limit or
restrict the rights that the holders of the Shares would otherwise be
entitled to under Section 4.2 of the Certificate of Designations but for
the provisions of this Section 2.6(b) and the subordination provisions of
Exhibit E hereto, it being understood and agreed that such holders shall
in any event be entitled to exercise their rights under such Section 4.2
even if the Company is limited or restricted by this Section 2.6(b)
and/or the subordination provisions of Exhibit E hereto from redeeming
Shares or otherwise making payments to the holders thereof.
1.5 Section 2.6(c)(i) of the Purchase Agreement is hereby amended and
restated in its entirety to read as follows:
(i) "Exit Event" shall mean:
(A) any sale or other disposition of all or substantially
all of the assets of the Company, upon liquidation of the Company or
otherwise;
(B) any merger or consolidation of the Company that results
in an exchange of a majority of the Common Stock of the Company for cash,
cash equivalents or other securities or property;
(C) any public offering of equity securities of the
Company; or
(D) any recapitalization, reorganization or other
transaction or event that results in a change in control of the Company;
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provided that, in any such event or transaction either the Company
receives consideration in the form of cash or cash equivalents and
promptly thereafter distributes all or substantially all of such
consideration to its stockholders, or the Purchaser is required or
permitted to sell or dispose of Warrant Securities in exchange for cash
or cash equivalents.
1.6 Section 6.3 of the Purchase Agreement is hereby amended and
restated in its entirety to read as follows:
6.3 Officer's Certificate. The Company shall deliver to the
Purchaser a certificate of its President dated the Closing Date, in form
and substance reasonably satisfactory to the Purchaser and its counsel,
(a) certifying the satisfaction of the conditions in Sections 6.1, 6.2,
6.8 and 6.9, and (b) certifying, as of the Closing Date, (i) the
aggregate principal amount of Senior Subordinated Notes with respect to
which the Company has entered into binding agreements or accepted
irrevocable tenders from the holders thereof for the repurchase or
redemption thereof on the Closing Date, and the average price per $1,000
face amount thereof payable by the Company pursuant to such agreements or
tenders, and (ii) the total number of shares of Common Stock outstanding
on a Fully-Diluted Basis.
1.7 Section 6.8 of the Stock Purchase Agreement is hereby amended and
restated in its entirety to read as follows:
6.8 Repurchases of Senior Subordinated Notes. The Company shall
have entered into binding agreements, or shall have accepted irrevocable
tenders by the holders thereof, for the repurchase or redemption, on or
before the Closing Date, of Senior Subordinated Notes in an aggregate
principal amount of at least $80,500,000, and for an aggregate purchase
price not exceeding (a) $580 per $1,000 principal amount of Senior
Subordinated Note to be repurchased or redeemed, and (b) $53,360,000 in
the aggregate.
1.8 Section 8.2 of the Purchase Agreement is hereby amended and
restated in its entirety to read as follows:
8.2 Repurchase or Redemption of Senior Subordinated Notes; Use
of Proceeds. Immediately following the execution of this Agreement, the
Company shall use its best efforts to obtain binding agreements to
repurchase or redeem on or before the Closing Date, pursuant to a tender
offer directed to the holders of the Senior Subordinated Notes and/or
individually negotiated arrangements, on terms and conditions reasonably
satisfactory to the Company in its sole but reasonable discretion, Senior
Subordinated Notes in an aggregate principal amount of at least
$80,500,000, for an aggregate purchase price not exceeding (a) $580 per
$1,000 principal amount of Senior Subordinated Note to be repurchased or
redeemed, and (b) $53,360,000 in the aggregate. The Company shall accept
all tenders of Senior Subordinated Notes whose owners are willing to have
their Senior Subordinated Notes repurchased or redeemed at a price equal
to or less than $580 per $1,000
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principal amount, provided that the maximum aggregate purchase price
(i.e., $53,360,000) is not exceeded. In no event, however, shall the
Company use (i) more than $7,360,000 from sources other than the proceeds
received from the sale of the Shares and the Warrants (either by making
draws under its senior credit facilities or otherwise), or (ii) funds
from sources other than the proceeds received from the sale of the Shares
and the Warrants prior to using at least $46,000,000 of proceeds
available to the Company from the sale of the Shares and the Warrants, to
repurchase Senior Subordinated Notes. The closing of such repurchase or
redemption of the Senior Subordinated Notes shall occur on the Closing
Date and simultaneously with the Closing.
1.9 Section 13 of the Purchase Agreement is hereby amended by adding
the following subsection 13.10 thereto:
13.10 Acknowledgment. The Purchaser hereby acknowledges that the
Loan and Security Agreement contains provisions which prohibit the
Company from, among other things, making distributions or declaring or
paying any dividends on, or purchasing, acquiring or redeeming, or
otherwise retiring any of its capital stock, and the Purchaser hereby
agrees that the Agent and the Lenders shall not have any liability for
tortious interference with contractual relations or for inducement by the
Company to breach of contract or otherwise.
1.10 The Purchase Agreement is hereby amended by adding a new Exhibit E
thereto in the form of Annex I to this Amendment No. 1.
1.11 Section 3 of the Certificate of Designations is hereby amended by
adding the following Section 3.11 thereto:
3.11 Limitation on Payment of Redemption Price. Notwithstanding
anything to the contrary contained in this Certificate of Designations,
but subject to the last sentence of this Section 3.11, all amounts
payable by the Corporation to the holders of Series A Preferred Stock in
respect of a redemption of shares of Series A Preferred Stock (including,
without limitation, pursuant to Section 3.3 or Section 3.4) shall be
subordinated to the prior payment in full of the Obligations (as defined
in the Loan and Security Agreement) arising under the Loan and Security
Agreement or any other Loan Document (as defined in the Loan and Security
Agreement) and the cancellation or cash collateralization of all Letters
of Credit (as defined in the Loan and Security Agreement) in accordance
with the subordination provisions of Annex I hereto. Nothing in this
Section 3.11, however, shall limit or restrict the rights that the
holders of Series A Preferred Stock would otherwise be entitled to under
Section 4.2 hereof but for the provisions of this Section 3.11 and the
subordination provisions of Annex I hereto, it being understood and
agreed that such holders shall in any event be entitled to exercise their
rights under Section 4.2 hereof even if the Corporation is limited or
restricted by this Section 3.11 and/or the subordination provisions of
Annex I hereto from redeeming shares of Series A Preferred Stock or
otherwise making payments to the holders thereof.
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1.12 Section 9 of the Certificate of Designations is hereby amended by
deleting the last sentence of the definition of "Corporate Change".
1.13 The Certificate of Designations is hereby amended by adding a new
Annex I thereto in the form of Annex II to this Amendment No. 1.
2. Miscellaneous.
2.1 Headings. The descriptive headings of the several Sections of this
Amendment No. 1 are inserted for convenience only, do not constitute a part of
this Amendment No. 1 and shall not affect in any way the meaning or
interpretation of this Amendment No. 1.
2.2 Applicable Law. This Amendment No. 1 shall be governed in all
respects by the laws of the State of Delaware (without giving effect to the
provisions thereof relating to conflicts of law).
2.3 Counterparts; Facsimile. This Amendment No. 1 may be executed in
several counterparts, each of which shall be deemed to be an original, and all
of which together shall be deemed to be one and the same instrument. This
Amendment No. 1 may be executed by facsimile signature.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to be
duly executed by their respective authorized officers on the day and year first
above written.
NUMATICS, INCORPORATED
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
NUMAT, LLC
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
[Signature Page to Amendment No. 1 to the Preferred Stock and Warrant
Purchase Agreement]
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ANNEX I
EXHIBIT E
To
Preferred Stock and Warrant Purchase Agreement
By and between Numatics, Incorporated and the Purchaser named therein
Subordination Provisions
1. So long as any of the Obligations (as defined in the Loan and
Security Agreement) remain unpaid, the Purchaser shall not, and shall have no
right to, (a) ask, demand, ▇▇▇ for, take or receive, or retain, from the Company
or any other person or entity, by setoff or in any other manner, payment of all
or any part of the amount payable by the Company pursuant to Section 2.6(b) of
the Agreement, (b) ask, demand or receive any security for payment of all or any
part of the amount payable by the Company pursuant to Section 2.6(b) of the
Agreement, (c) amend the subordination provisions of this Exhibit E, or (d)
bring or join with any creditor in bringing any proceeding against the Company
under any bankruptcy, reorganization, readjustment or arrangement of debt,
receivership, liquidation or insolvency or similar law or statute now or
hereafter in effect ("Proceedings").
2. Without limiting the foregoing, upon any distribution of the
assets of the Company in connection with any dissolution, winding up,
liquidation or reorganization of the Company (whether in any Proceedings or upon
an assignment for the benefit of creditors or any other marshalling of the
assets and liabilities of the Company or otherwise), (a) until such time as all
Obligations (as defined in the Loan and Security Agreement) have been paid in
full and all Letters of Credit (as defined in the Loan and Security Agreement)
have been cancelled or cash collateralized, the Agent and the Lenders shall
first be entitled to receive payment in full of the Obligations (as defined in
the Loan and Security Agreement) and cash collateral in respect of the Letters
of Credit (as defined in the Loan and Security Agreement) before the Purchaser
shall be entitled to receive payment of any amount payable by the Company
pursuant to Section 2.6(b) of the Agreement. Upon any such dissolution, winding
up, liquidation or reorganization, any payment or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
which the Purchaser would be entitled except for the subordination provisions of
this Exhibit E shall be made by the liquidating trustee or agent or other
persons making such payment or distribution (whether a trustee in bankruptcy, a
receiver or liquidating trustee or otherwise) (a "Paying Party"), or if received
by the Purchaser, by the Purchaser, directly to the Agent and the Lenders, until
such time as all Obligations (as defined in the Loan and Security Agreement)
have been paid in full and all Letters of Credit (as defined in the Loan and
Security Agreement) have been cancelled or cash collateralized. The Purchaser
hereby authorizes and directs each Paying Party to pay over to the Agent and the
Lenders, upon demand by the Agent, all such payments or distributions without
the necessity of any inquiry as to the status or balance of the outstanding
Obligations (as defined in the Loan and Security Agreement), and without further
notice to or consent of the Purchaser.
3. In the event any payment or distribution of assets of the Company
of any kind or character, whether in cash, property or securities, and whether
or not pursuant to any dissolution, winding up, liquidation or reorganization,
not permitted by or in accordance with the subordination provisions of this
Exhibit E shall be received by the Purchaser, such payment or distribution to
the Purchaser shall not be commingled with other funds and shall be held in
trust for the benefit of, and shall be paid over or delivered to, the Agent, or
to its representatives, in precisely the form received (except for the
endorsement or assignment of the Purchaser where necessary). Any such payment or
distribution received by the Purchaser and paid to the Agent shall be deemed not
to be a payment in respect of amounts payable by the Company pursuant to Section
2.6(b) and such amounts shall remain payable as if such payment or distribution
had never been made by the Company or received by the Purchaser. In the event of
any failure by the Purchaser to make any such endorsement or assignment, the
Agent is hereby irrevocably authorized to make same.
4. The Purchaser shall not be entitled to be subrogated to any of
the rights of the Agent or any Lender against the Company or any other person or
entity nor shall the Purchaser be entitled to any benefit of any lien or other
encumbrance securing any of the Obligations (as defined in the Loan and Security
Agreement) or any collateral subject to any such lien, or to rights of offset
held by the Agent or any Lender for the payment of any of the Obligations (as
defined in the Loan and Security Agreement), nor shall the Purchaser have any
right of indemnity, reimbursement or contribution against the Company or any
other person or entity for any payment of the Obligations (as defined in the
Loan and Security Agreement), and the Purchaser expressly waives each and every
such right of subrogation, indemnity, reimbursement and contribution that it
would have but for the subordination provisions of this Exhibit E until such
time as all Obligations (as defined in the Loan and Security Agreement) have
been paid in full and all Letters of Credit (as defined in the Loan and Security
Agreement) have been cancelled or cash collateralized.
5. All references in this Exhibit E to the Obligations (as defined
in the Loan and Security Agreement) are to be understood to include all amounts
due on the Obligations (as defined in the Loan and Security Agreement) both
before and after and filing of any Proceeding by or against the Company, and the
Agent and the Lenders and their successors and assigns as creditors in respect
of the Obligations (as defined in the Loan and Security Agreement) shall be
entitled to amounts accruing on the Obligations (as defined in the Loan and
Security Agreement) from the date of filing of any such Proceeding to the date
of full and final payment of the Obligations (as defined in the Loan and
Security Agreement) and the cancellation or cash collateralization of all
Letters of Credit (as defined in the Loan and Security Agreement). All
Obligations (as defined in the Loan and Security Agreement) to which the
provisions of this Exhibit E may apply shall conclusively be presumed to have
been created in reliance on the subordination provisions of this Exhibit E.
6. In the event of a breach by the Purchaser of any of the
subordination provisions of this Exhibit E, each of the Agent and the Lenders
(and their successors and assigns) shall have all rights provided to them under
law or equity, including without limitation the right to ▇▇▇ the Purchaser to
recover damages suffered as a result of such breach, and the right to obtain
injunctive relief.
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7. Notwithstanding any other provision in this Exhibit E to the
contrary, nothing in this Exhibit E shall limit or restrict the rights that the
holders of the Shares would otherwise be entitled to under Section 4.2 of the
Certificate of Designations but for the provisions of this Exhibit E, it being
understood and agreed that such holders shall in any event be entitled to
exercise their rights under such Section 4.2 hereof even if the Company is
limited or restricted by this Exhibit E from redeeming shares of Series A
Preferred Stock or otherwise making payments to the holders thereof.
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ANNEX II
ANNEX I
To
Certificate of Designations
Subordination Provisions
1. So long as any of the Obligations (as defined in the Loan and
Security Agreement) remain unpaid, the Purchaser shall not, and shall have no
right to, (a) ask, demand, ▇▇▇ for, take or receive, or retain, from the
Corporation or any other person or entity, by setoff or in any other manner,
payment of all or any part of the amount payable by the Corporation pursuant to
Section 2.6(b) of the Agreement, (b) ask, demand or receive any security for
payment of all or any part of the amount payable by the Corporation pursuant to
Section 2.6(b) of the Agreement, (c) amend the subordination provisions of this
Annex I, or (d) bring or join with any creditor in bringing any proceeding
against the Corporation under any bankruptcy, reorganization, readjustment or
arrangement of debt, receivership, liquidation or insolvency or similar law or
statute now or hereafter in effect ("Proceedings").
2. Without limiting the foregoing, upon any distribution of the
assets of the Corporation in connection with any dissolution, winding up,
liquidation or reorganization of the Corporation (whether in any Proceedings or
upon an assignment for the benefit of creditors or any other marshalling of the
assets and liabilities of the Corporation or otherwise), (a) until such time as
all Obligations (as defined in the Loan and Security Agreement) have been paid
in full and all Letters of Credit (as defined in the Loan and Security
Agreement) have been cancelled or cash collateralized, the Agent and the Lenders
shall first be entitled to receive payment in full of the Obligations (as
defined in the Loan and Security Agreement) and cash collateral in respect of
the Letters of Credit (as defined in the Loan and Security Agreement) before the
Purchaser shall be entitled to receive payment of any amount payable by the
Corporation pursuant to Section 2.6(b) of the Agreement. Upon any such
dissolution, winding up, liquidation or reorganization, any payment or
distribution of assets of the Corporation of any kind or character, whether in
cash, property or securities, to which the Purchaser would be entitled except
for the subordination provisions of this Annex I shall be made by the
liquidating trustee or agent or other persons making such payment or
distribution (whether a trustee in bankruptcy, a receiver or liquidating trustee
or otherwise) (a "Paying Party"), or if received by the Purchaser, by the
Purchaser, directly to the Agent and the Lenders, until such time as all
Obligations (as defined in the Loan and Security Agreement) have been paid in
full and all Letters of Credit (as defined in the Loan and Security Agreement)
have been cancelled or cash collateralized. The Purchaser hereby authorizes and
directs each Paying Party to pay over to the Agent and the Lenders, upon demand
by the Agent, all such payments or distributions without the necessity of any
inquiry as to the status or balance of the outstanding Obligations (as defined
in the Loan and Security Agreement), and without further notice to or consent of
the Purchaser.
3. In the event any payment or distribution of assets of the
Corporation of any kind or character, whether in cash, property or securities,
and whether or not pursuant to any dissolution, winding up, liquidation or
reorganization, not permitted by or in accordance with the subordination
provisions of this Annex I shall be received by the Purchaser, such payment or
distribution to the Purchaser shall not be commingled with other funds and shall
be held in trust for the benefit of, and shall be paid over or delivered to, the
Agent, or to its representatives, in precisely the form received (except for the
endorsement or assignment of the Purchaser where necessary). Any such payment or
distribution received by the Purchaser and paid to the Agent shall be deemed not
to be a payment in respect of amounts payable by the Corporation pursuant to
Section 2.6(b) of the Agreement and such amounts shall remain payable as if such
payment or distribution had never been made by the Corporation or received by
the Purchaser. In the event of any failure by the Purchaser to make any such
endorsement or assignment, the Agent is hereby irrevocably authorized to make
same.
4. The Purchaser shall not be entitled to be subrogated to any of
the rights of the Agent or any Lender against the Corporation or any other
person or entity nor shall the Purchaser be entitled to any benefit of any lien
or other encumbrance securing any of the Obligations (as defined in the Loan and
Security Agreement) or any collateral subject to any such lien, or to rights of
offset held by the Agent or any Lender for the payment of any of the Obligations
(as defined in the Loan and Security Agreement), nor shall the Purchaser have
any right of indemnity, reimbursement or contribution against the Corporation or
any other person or entity for any payment of the Obligations (as defined in the
Loan and Security Agreement), and the Purchaser expressly waives each and every
such right of subrogation, indemnity, reimbursement and contribution that it
would have but for the subordination provisions of this Annex I until such time
as all Obligations (as defined in the Loan and Security Agreement) have been
paid in full and all Letters of Credit (as defined in the Loan and Security
Agreement) have been cancelled or cash collateralized.
5. All references in this Annex I to the Obligations (as defined in
the Loan and Security Agreement) are to be understood to include all amounts due
on the Obligations (as defined in the Loan and Security Agreement) both before
and after and filing of any Proceeding by or against the Corporation, and the
Agent and the Lenders and their successors and assigns as creditors in respect
of the Obligations (as defined in the Loan and Security Agreement) shall be
entitled to amounts accruing on the Obligations (as defined in the Loan and
Security Agreement) from the date of filing of any such Proceeding to the date
of full and final payment of the Obligations (as defined in the Loan and
Security Agreement) and the cancellation or cash collateralization of all
Letters of Credit (as defined in the Loan and Security Agreement). All
Obligations (as defined in the Loan and Security Agreement) to which the
provisions of this Annex I may apply shall conclusively be presumed to have been
created in reliance on the subordination provisions of this Annex I.
6. In the event of a breach by the Purchaser of any of the
subordination provisions of this Annex I, each of the Agent and the Lenders (and
their successors and assigns) shall have all rights provided to them under law
or equity, including without limitation the right to ▇▇▇ the Purchaser to
recover damages suffered as a result of such breach, and the right to obtain
injunctive relief.
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7. Notwithstanding any other provision in this Annex I to the
contrary, nothing in this Annex I shall limit or restrict the rights that the
holders of the Shares would otherwise be entitled to under Section 4.2 of this
Certificate of Designations but for the provisions of this Annex I, it being
understood and agreed that such holders shall in any event be entitled to
exercise their rights under Section 4.2 hereof even if the Corporation is
limited or restricted by this Annex I from redeeming shares of Series A
Preferred Stock or otherwise making payments to the holders thereof.
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