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EXHIBIT 10.1.5
HERITAGE OPERATING, L.P.
FIFTH AMENDMENT TO CREDIT AGREEMENT
This Fifth Amendment to Credit Agreement, dated as of November 13,
1998, is among Heritage Operating, L.P., a Delaware limited partnership (the
"Company"), the Banks party hereto, BankBoston, N.A. (formerly known as The
First National Bank of Boston), as administrative agent (the "Administrative
Agent") for itself and the other Banks, and Bank of Oklahoma, National
Association, as documentation agent (the "Documentation Agent") for itself and
the other Banks. The parties agree as follows:
1. Reference to Credit Agreement; Background.
1.1. Reference to Credit Agreement; Definitions. Reference is made to
the Credit Agreement dated as of June 25, 1996, as amended by the First
Amendment to Credit Agreement dated as of July 25, 1996, the Second Amendment to
Credit Agreement dated as of February 28, 1997, the Third Amendment to Credit
Agreement dated as of September 30, 1997 and the Fourth Amendment to Credit
Agreement dated as of November 18, 1997 (as so amended, the "Credit Agreement"),
among the Company, the Banks from time to time party thereto, the Administrative
Agent and the Documentation Agent. The Credit Agreement, as amended by the
amendments set forth in Section 2 hereof (the "Amendment"), is referred to as
the "Amended Credit Agreement." Terms defined in the Amended Credit Agreement
and not otherwise defined herein are used herein with the meanings so defined.
1.2. Background. The Company has requested that the Bank agree to
certain changes in pricing and in certain financial covenants provided in the
Credit Agreement.
2. Amendments to Credit Agreement. Subject to all of the terms and conditions
hereof and in reliance upon the representations and warranties set forth or
incorporated by reference in Section 3 hereof, the Credit Agreement is amended
as follows, effective as of the date specified with respect to each such
amendment:
2.1. Section 1.1 of the Credit Agreement is amended, effective from and
after the Financial Statement Delivery Date for the fiscal quarter of the
Company ending August 31, 1998, by amending the definition of the term
"Applicable Commitment Fee Percentage" to read in its entirety as follows:
"Applicable Commitment Fee Percentage" means, with respect to
any Margin Period, the applicable percentage set forth below:
(i) if the Leverage Ratio on the Financial Statement
Delivery Date beginning such Margin Period was less than 3.25
to 1, .25%;
(ii) if the Leverage Ratio on the Financial Statement
Delivery Date beginning such Margin Period was equal to or
greater then 3.25 to 1 but less than 3.75 to 1, .30%;
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(iii) if the Leverage Ratio on the Financial
Statement Delivery Date beginning such Margin Period was equal
to or greater than 3.75 to 1 but less than 4.25 to 1, .35%;
and
(iv) if the Leverage Ratio on the Financial Statement
Delivery Date beginning such Margin Period was equal to or
greater than 4.25 to 1, .375%
Notwithstanding the foregoing, if any of the financial
statements required pursuant to Section 7A.1(i) are not delivered
within the time periods specified in Section 7A.1(i), the Applicable
Commitment Fee Percentage shall be .375% until the date such statements
are delivered.
2.2 Section 1.1 of the Credit Agreement is further amended, effective
from and after the Financial Statement Delivery Date for the fiscal quarter of
the Company ending August 31, 1998, by amending the definition of the term
"Applicable Margin" to read in its entirety as follows:
"Applicable Margin". With respect to any Eurodollar Loan or
with respect to any Base Rate Loan, for each Margin Period the rate of
interest per annum determined as set forth below:
(i) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was less than 3.25
to 1, the Applicable Margin will be .75% for Eurodollar Loans
and zero for Base Rate Loans;
(ii) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was equal to or
greater than 3.25 to 1 but less than 3.75 to 1, the Applicable
Margin will be 1.00% for Eurodollar Loans and zero for Base
Rate Loans;
(iii) if the Leverage Ratio on the Financial
Statement Delivery Date commencing such Margin Period was
equal to or greater than 3.75 to 1 but less than 4.25 to 1,
the Applicable Margin will be 1.25% for Eurodollar Loans and
zero for Base Rate Loans;
(iv) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was equal to or
greater than 4.25 to 1 but less than 4.50 to 1, the Applicable
Margin will be 1.375% for Eurodollar Loans and zero for Base
Rate Loans; and
(v) if the Leverage Ratio on the Financial Statement
Delivery Date commencing such Margin Period was equal to or
greater than 4.50 to 1 but less than 4.75 to 1, the Applicable
Margin will be 1.50% for Eurodollar Loans and zero for Base
Rate Loans; and
(vi) if the Leverage Ratio on the Financial
Statement Delivery Date commencing such Margin Period was
equal to or greater than 4.75 to
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1, the Applicable Margin will be 1.75% for Eurodollar Loans
and .125% for Base Rate Loans.
Notwithstanding the foregoing, if any of the financial
statements required pursuant to Section 7A.1(i) are not delivered
within the time periods specified in Section 7A.1(i), the Applicable
Margin shall be the Applicable Margin set forth in clause (vi) above
until the date such statements are delivered.
2.3. Section 2.1.2 of the Credit Agreement is amended, effective as of
November 13, 1998, to read in its entirety as follows:
2.1.2 Maximum Amount of Acquisition Credit. The term "Maximum
Amount of Acquisition Credit" means, on any date on or prior to the
Acquisition Conversion Date, the remainder of (x) the lesser of (a)
$30,000,000 or (b) the aggregate Acquisition Loan Commitments described
in Section 10.1, as amended from time to time, minus (y) the aggregate
principal amount of the HHI Acquisition Notes from time to time, or
such lesser amount as the Borrower may specify from time to time by
notice from the Borrower to the Administrative Agent and, after the
Acquisition Conversion Date, zero.
2.4. Section 2.2.2 of the Credit Agreement is amended, effective as of
November 13, 1998, to read in its entirety as follows:
2.2.2 Maximum Amount of Working Capital Credit. The term,
"Maximum Amount of Working Capital Credit" means, on any date,
$20,000,000 minus the outstanding principal balance on the Indebtedness
permitted by Section 7B.2(v) or such lesser amount as the Borrower may
specify from time to time by notice from the Borrower to the
Administrative Agent; provided that the aggregate outstanding principal
amount of the Working Capital Loan shall be $0 for a period of not less
than 30 consecutive calendar days at least one time during each fiscal
year of the Borrower (the "Annual Clean-Up"). Failure by the Borrower
to comply with the provisions of the Annual Clean-Up shall constitute
a failure to pay the Loans when due and an Event of Default under
Section 9.1.
2.5. Section 7B.1 of the Credit Agreement is amended, effective as of
August 31, 1998, by amending clause (ii) thereof to read in its entirety as
follows:
(ii) Ratio of Consolidated Funded Indebtedness to Consolidated
EBITDA. The Borrower will not permit the ratio of the last day of any
fiscal quarter of Consolidated Funded Indebtedness to Consolidated
EBITDA to exceed (a) 5.00 to 1 on any date on or prior to August 31,
1999, or (b) 4.75 to 1 on any date after August 31, 1999;
2.6 Section 10.1 of the Credit Agreement is amended, effective as of
November 13, 1998, to read in its entirety as follows:
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10.1 Interests in Loans/Commitments. The percentage interest
of each Bank in the Loans and Letters of Credit, and the Commitments,
shall be computed based on the maximum principal amount for each Bank
as follows:
Maximum Maximum
Acquisition Working Maximum
Loan Capital Loan Commitment Percentage
Bank Commitments Commitments Amounts Interests
---- ----------- ----------- ----------- -----------
BOk $12,000,000 $8,000,000 $20,000,000 40%
Bank of Boston 12,000,000 8,000,000 20,000,000 40%
Mercantile 6,000,000 4,000,000 10,000,000 20%
----------- ----------- ----------- -----------
TOTAL $30,000,000 $20,000,000 $50,000,000 100%
The foregoing percentage interests, as from time to time in effect and
reflected in the Register, are referred to as the "Percentage
Interests" with respect to all or any portion of the Loans and Letters
of Credit, and the Commitments.
3. Representations and Warranties. In order to induce the Banks to enter into
this Amendment, the Company represents and warrants to each of the Banks that:
3.1 No Legal Obstacle to Agreements. Neither the execution and delivery
of this Amendment or any other Loan Document, nor the making of any borrowing
under the Amended Credit Agreement, nor the guaranteeing of the Credit
Obligations, nor the securing of the Credit Obligations with the Collateral, nor
the consummation of any transaction referred to in or contemplated by this
Amendment, the Amended Credit Agreement or any other Loan Document, nor the
fulfillment of the terms hereof or thereof or of any other agreement,
instrument, deed or lease contemplated by this Amendment, the Amended Credit
Agreement or any other Loan Document, has constituted or resulted in or will
constitute or result in:
(a) any breach or termination of the provisions of any
agreement, instrument, deed or lease to which the Company is a party or
by which it is bound, or of the Partnership Agreement of the Company;
(b) the violation of any law, statute, judgement, decree or
governmental order, rule or regulation applicable to the Company;
(c) the creation under any agreement, instrument, deed or
lease of any Lien (other than Liens on the Collateral which secure the
Credit Obligations and Liens permitted by Section 7B.3 of the Amended
Credit Agreement) upon any of the assets of the Company; or
(d) any redemption, retirement or other repurchase obligation
of the Company under the Partnership Agreement or other agreement,
instrument, deed or lease.
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No approval, authorization or other action by, or declaration to or filing with,
any governmental or administrative authority or any other Person is required to
be obtained or made by the Company in connection with the execution and delivery
of this Amendment, the performance of this Amendment, the Amended Credit
Agreement or any other Credit Document, the transactions contemplated hereby or
thereby, the making of any borrowing under the Amended Credit Agreement, the
guaranteeing of the Credit Obligations or the securing of the Credit Obligation
with the Collateral.
3.2. Defaults. Immediately after giving effect to this Amendment, no
Default shall exist.
3.3. Incorporation of Representations and Warranties of Company.
Immediately after giving effect to this Amendment, the representations and
warranties set forth in Article VIII of the Amended Credit Agreement will be
true and correct as if originally made on and as of the Amendment Closing Date
(except to the extent of any representation or warranty which refers to a
specific earlier date).
4. Conditions. The effectiveness of each of the amendments set forth in Section
2 hereof shall be subject to the satisfaction of the following conditions:
4.1. Representations. The representations and warranties contained in
Section 3 hereof shall be true and correct on and as of the Amendment Closing
Date with the same force and effect as though originally made on and as of the
Amendment Closing Date; immediately after giving effect to such amendments, no
Default shall exist; and no Material Adverse Change shall have occurred since
August 31, 1997.
4.2. Replacement Notes. The Company shall have executed and delivered
to the Administrative Agent for delivery to each of the Banks replacement
Acquisition Notes and Working Capital Notes in the amount of each Bank's
Percentage Interest in the Maximum Amount of Acquisition Credit and the Maximum
Amount of Working Capital Credit, respectively.
4.3. Note Purchase Agreement. The effectiveness of the amendments
provided in Sections 2.3, 2.4 and 2.6 of this Amendment is conditioned on the
consummation of an amendment of Section 6B(ii) of the Note Purchase Agreement
increasing the aggregate principal amount of Indebtedness permitted thereby from
$15,000,000 to $20,000,000.
4.4. Proper Proceedings. All proper proceedings shall have been taken
by the Company to authorize this Amendment, the Amended Credit Agreement and the
transactions contemplated hereby and thereby. On or before the Amendment Closing
Date, the Agents shall have received copies of all documents, including legal
opinions of counsel and records of corporate proceedings which the Agents may
have requested in connection therewith, such documents, where appropriate, to be
certified by proper corporate or governmental authorities.
4.5. Execution and Delivery. Each of the Company and the Banks shall
have executed and delivered this Amendment.
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5. Further Assurances. The Company will, promptly upon the request of the Agent
from time to time, execute, acknowledge and deliver, and file and record, all
such instruments and notices, and take all such action, as the Agents deem
necessary or advisable to carry out the intent and purposes of this Amendment
and the Amended Credit Agreement.
6. General. The Amended Credit Agreement and all of the other Loan Documents are
each confirmed as being in full force and effect. This Amendment, the Amended
Credit Agreement and the other Loan Documents referred to herein or therein
constitute the entire understanding of the parties with respect to the subject
matter hereof and thereof and supersede all prior and current understandings and
agreements, whether written or oral, with respect to such subject matter. The
invalidity or unenforceability of any provision hereof shall not affect the
validity and enforceability of any other term or provision hereof. The headings
in this Amendment are for convenience of reference only and shall nor alter,
limit or otherwise affect the meaning hereof. Each of this Amendment and the
Amended Credit Agreement is a Loan Document and may be executed in any number of
counterparts, which together shall constitute one instrument, and shall bind and
inure to the benefit of the parties and their respective successors and assigns,
including as such successors and assigns all holders of any Note. This Amendment
shall be governed by and construed in accordance with the laws (other than the
conflict of law rules) of the State of Oklahoma.
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Each of the undersigned has caused this Amendment to be executed and
delivered by its duly authorized officer as an agreement under seal as of the
date first above written.
HERITAGE OPERATING L.P., a Delaware
limited partnership
By: Heritage Holdings, Inc., a Delaware
corporation, general partner
By: /s/ H. Xxxxxxx Xxxxxxxx
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H. Xxxxxxx Xxxxxxxx, Vice President and
Chief Financial Officer
BANKBOSTON, N.A., individually and as
Administrative Agent for the Lenders
By: /s/ Xxxxxxx X. Xxxxxx
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Authorized Officer
BANK OF OKLAHOMA, NATIONAL
ASSOCIATION, individually and as
Documentation Agent
By: /s/ Xxxxxx X. Xxxxxx
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Authorized Officer
MERCANTILE BANK NATIONAL
ASSOCIATION
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Vice President
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