Exhibit 10.16
SIXTH AMENDMENT AGREEMENT
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SIXTH AMENDMENT AGREEMENT (this "Agreement") dated as of December 31,
1996 by and among (1) Xomed Surgical Products, Inc. ("Holdings"), (2) Merocel
Corporation ("Merocel"), (3) Xomed, Inc. ("Xomed"), (4) Xomed-Xxxxxx, X.X. Inc.
("Xomed P.R."), (5) Trebay Medical Corporation ("Trebay" and, together with
Holdings, Merocel, Xomed and Xomed P.R., collectively, the "Borrowers" and each
singularly , a "Borrower") and (5) Bank of Boston Connecticut ("BKBCT") and
certain other financial institutions which may become a party to the Credit
Agreement (collectively, the "Banks" and individually, a "Bank"), and (6) BKBCT
as agent (the "Agent") for the Banks, with respect to a certain Credit Agreement
dated as of April 15, 1994 by and among the Borrowers, the Banks and the Agent,
as amended by a certain First Amendment Agreement dated June 24, 1994, an
Amendment and Waiver Agreement dated as of March 31, 1995, a Second Amendment
and Waiver Agreement dated as of July 3, 1995, a Third Amendment and Waiver
Agreement dated as of April 15, 1996, a Joinder Agreement dated as of April 16,
1996, a Fourth Amendment and Waiver Agreement dated as of June 7, 1996 and a
Fifth Amendment and Waiver Agreement dated as of September 3, 1996 (as amended
from time to time, collectively, the "Credit Agreement").
W I T N E S S E T H:
WHEREAS, the Borrowers have requested that the Banks and the Agent
amend certain terms and conditions of the Credit Agreement; and
WHEREAS, the Agent and the Banks are willing to amend certain terms
and conditions of the Credit Agreement on the terms and conditions set forth
herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
Section 1. Capitalized terms used herein without definition that are
defined in the Credit Agreement shall have the same meanings herein as therein.
Section 2. Ratification of Existing Agreements. All of the Borrowers'
obligations and liabilities to the Banks and the Agent as evidenced by or
otherwise arising under the Credit Agreement, the Revolving Credit Notes and the
other Loan Documents, are, by each Borrower's execution of this Agreement,
ratified and confirmed in all respects. In addition, by each Borrower's
execution of this Agreement, each Borrower represents and warrants that no
counterclaim, right of set-off or defense of any kind exists or is outstanding
with respect to such obligations and liabilities.
Section 3. Representations and Warranties. All of the representations
and warranties made by the Borrowers in the Credit Agreement, the Revolving
Credit Notes and the other Loan Documents (other than Section7.1(d) and
Section7.12(a) with respect to Borrowers' 1995
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tax returns) are true and correct on the date hereof as if made on and 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 any of such
representations and warranties relate expressly to an earlier date.
Section 4. Conditions Precedent. The effectiveness of the amendments
contemplated hereby shall be subject to the satisfaction on or before the date
hereof of each of the following conditions precedent:
(a) Representations and Warranties. All of the representations and
warranties made by the Borrowers herein, whether directly or incorporated by
reference, shall be true and correct on the date hereof, except as provided in
Section 3 hereof.
(b) Performance; No Event of Default. The Borrowers shall have
performed and complied in all material respects with all terms and conditions
herein required to be performed or complied with by it prior to or at the time
hereof, and there shall exist no Default or Event of Default.
(c) Corporate Action. All requisite corporate action necessary for the
valid execution, delivery and performance by the Borrowers of this Agreement and
all other instruments and documents delivered by the Borrowers in connection
therewith shall have been duly and effectively taken.
(d) Delivery. The parties hereto shall have executed and delivered
this Agreement. In addition, the Borrowers shall have executed and delivered
such further instruments, and take such further action as the Agent and the
Banks may have reasonably requested, in each case further to effect the purposes
of this Agreement, the Credit Agreement and the other Loan Documents.
(e) MFC Agreements. The Borrowers shall have caused Merocel Funding
Corporation ("MFC") to execute and deliver to the Banks and the Agent a written
agreement and acknowledgment, in form and substance satisfactory to the Banks
and the Agent, regarding the terms and conditions of this Agreement and each of
the other Loan Documents and MFC's status and obligations as a Borrower
hereunder and under the other Loan Documents.
(f) Amendments to Loan Documents. The Borrowers (including,
without limitation, MFC) shall have executed and delivered to the
Agent a Second Amended and Restated Security Agreement and a Third
Amended and Restated Revolving Credit Note, each in form and substance
satisfactory to the Agent and the Banks. In addition, pursuant to
pledge, assignment and security agreements, each in form and substance
satisfactory to the Banks and the Agent, the Borrowers shall have
caused MFC to grant to the Agent on behalf of the Banks a valid and
perfected first (subject only to Permitted Liens) security interest in
all of its properties and assets. The Borrowers acknowledge and agree
that all of such security and pledge
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agreements shall be included in the definition of Security Documents under the
Credit Agreement.
(g) Amendment to Merocel Stock Pledge Agreement. Merocel
shall have executed and delivered an amendment to the Merocel Stock
Pledge Agreement to evidence the Merocel's pledge of all of the MFC
Common Stock to the Agent, for the benefit of the Banks, such
amendment to be in form and substance satisfactory to the Banks and
the Agent.
(h) Fees and Expenses. The Borrowers shall have paid to the
Agent and Banks all fees and expenses incurred by the Agent and Banks
in connection with this Agreement, the Credit Agreement or the other
Loan Documents on or prior to the date hereof.
(i) Assignments. Each of Bank of Scotland, The Chase
Manhattan Bank and Internationale Nederlanden (U.S.) Capital
Corporation shall have assigned all of their right, title and interest
under the Credit Agreement and the other Loan Documents pursuant to
Assignment and Acceptances executed and delivered by each of Bank of
Scotland, The Chase Manhattan Bank and Internationale Nederlanden
(U.S.) Capital Corporation to Bank of Boston Connecticut. In addition,
each of Bank of Scotland, The Chase Manhattan Bank and Internationale
Nederlanden (U.S.) Capital Corporation shall have (i) returned to the
Agent their respective Amended and Restated Revolving Credit Notes
marked "canceled" and (ii) received payment from Bank of Boston
Connecticut of all amounts due and payable to each of them under the
Credit Agreement as of the date hereof in connection with the
assignments.
Section 5. Amendments to the Credit Agreement.
(a) Amendment to Preamble. The Preamble to the Credit
Agreement is hereby amended in its entirety:
"This CREDIT AGREEMENT is made as of the 15th day of
April, 1994, by and among MEROCEL CORPORATION ("Merocel"),
XOMED INC. (formerly known as Xomed-Xxxxxx, Inc.) ("Xomed"),
XOMED-XXXXXX, X.X., INC. ("Xomed P.R."), TREBAY MEDICAL
CORPORATION ("Trebay"), XOMED SURGICAL PRODUCTS, INC.
(formerly known as Merocel/Xomed Holdings, Inc.) ("Holdings")
and MEROCEL FUNDING CORPORATION ("MFC" and, together with
Merocel, Xomed, P.R., Xomed, Trebay and Holdings, the
"Borrowers" and each, singularly, a "Borrower"), each a
Delaware corporation and BANK OF BOSTON CONNECTICUT and the
other lending institutions listed on Schedule 1 attached
hereto (collectively, the "Banks") and BANK OF BOSTON
CONNECTICUT as agent for itself and the other Banks (in such
capacity, the "Agent") as amended by a certain First Amendment
Agreement dated June 24, 1994, an Amendment and Waiver
Agreement dated as of March 31, 1995, a Second Amendment and
Waiver Agreement dated as of July 3, 1995, a Third Amendment
and Waiver Agreement dated as of April 15,
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1996, a Joinder Agreement dated as of April 16, 1996, a
Fourth Amendment and Waiver Agreement dated as of June 7,
1996, a Fifth Amendment and Waiver Agreement dated as of
September 3, 1996 and a Sixth Amendment Agreement dated as
of December 31, 1996 (as amended from time to time,
collectively, the "Credit Agreement")."
(b) Amendment to Schedule 1. Schedule 1 of the Credit
Agreement is hereby amended as of the date hereof to read as
follows:
"Schedule 1
Lending Institutions
COMMITMENT
BANKS COMMITMENT PERCENTAGE
Bank of Boston Connecticut $14,000,000.00 100.00%"
00 Xxxx Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx
(x) Amendment to Schedule 2 of the Credit Agreement. The following new
definitions are hereby added to Schedule 2 of the Credit Agreement:
"Receivable Servicing Agreement. That certain Receivables
Servicing Agreement by and between Xomed and MFC dated December 31,
1996."
"MFC. See the Preamble hereto."
(d) Amendment to Schedule 2 of the Credit Agreement. The definition of
"Consolidated Financial Obligations" appearing on Page 4 of Schedule 2 is hereby
amended by adding the following at the end of such definition.
"The Indebtedness permitted under ss.9.1(k) shall not be
included when calculating Consolidated Financial Obligations under
ss.10.1 of the Credit Agreement."
(e) Amendments to Section 6 of the Credit Agreement. Section 6 of the
Credit Agreement is hereby amended by adding the phrase "(other than Holdings)"
after the word "Borrower" appearing in the fourth line of such section.
(f) Amendment to Section 7.1(d) and Schedule 7.1(d) of the Credit
Agreement. Section 7.1(d) and Schedule 7.1(d) of the Credit Agreement are each
hereby amended in their entirety to read as follows:
"Intentionally Omitted."
(g) Amendment to Schedule 7.2 of the Credit Agreement. Schedule 7.2 of
the Credit Agreement is hereby deleted in its entirety and Schedule 7.2 attached
hereto is hereby substituted therefor.
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(h) Amendment to Section 9.1 of the Credit Agreement. Section 9.1 of
the Credit Agreement is hereby amended by adding the following new subsection
(k) thereto:
"(k) unsecured Indebtedness owing by MFC to Xomed; provided,
however, that any such Indebtedness shall be evidenced by an
intercompany note which shall be pledged to the Agent pursuant to
arrangements in form and substance satisfactory to the Agent."
(i) Amendment to Section 9.3(h) of the Credit Agreement. Section
9.3(h) of the Credit Agreement is hereby amended in its entirety to read as
follows:
"(h) Investments in wholly-owned Subsidiaries of any
Borrower; provided, that each such Subsidiary shall have (i) either
(A) become a borrower under the Credit Agreement and the other Loan
Documents or (B) guaranteed the prompt payment and performance of all
of the Obligations pursuant to a guaranty in form and substance
satisfactory to the Majority Banks and (ii) granted to the Agent on
behalf of the Banks a valid and perfected security interest in and
lien on all of the assets and properties of such Subsidiary pursuant
to a security agreement in form and substance satisfactory to the
Majority Banks; and provided, further, that the aggregate Dollar
amount of all Investments by the Borrowers in all such Subsidiaries by
the Borrowers shall not exceed $3,000,000 in the aggregate (other than
Investments permitted under Section 9.3(i))."
(j) Amendment to Section 9.3 of the Credit Agreement. Section 9.3 of
the Credit Agreement is hereby amended by adding the following new subsection
(i) thereto:
"(i) Investments by Xomed in MFC as evidenced by the
Indebtedness permitted under Section 9.1(k) hereof."
(k) Amendment to Section 9.5(b) of the Credit Agreement. Section
9.5(b) of the Credit Agreement is hereby amended by adding the following at the
end of such subsection:
"and other than the sale or assignment from time to time,
subject to the liens and security interests granted in favor of the
Agent, by Xomed to MFC or MFC to Xomed of Accounts Receivable and
other amounts receivable arising from Xomed's business."
(l) Amendment to Section 9. Section 9 of the Credit Agreement is
hereby amended by adding the following as a new Section 9.16 thereto to read as
follows:
"Section 9.16. Amendment of Receivable Servicing Agreement.
Without the prior written consent of the Majority Banks, no Borrower
shall cause or permit or consent to any material amendment or
modification of any term or condition of the Receivable Servicing
Agreement."
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(m) Amendment to Section 20(a) of the Credit Agreement. Section 20(a)
of the Credit Agreement is hereby amended in its entirety to read as follows:
"(a) if to the Borrowers, c/o Xomed Surgical Products, Inc.,
0000 Xxxxxxxxxx Xxxxx Xxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000, Attention:
Xxxxxx Xxxxxx, or at such other address for notice as the Borrowers
shall last have furnished in writing to the Person giving the notice;"
Section 6. Additional Covenants. Without any prejudice or impairment
whatsoever to any of the Banks' and/or Agent's rights and remedies contained in
the Credit Agreement and the covenants contained therein, the Revolving Credit
Notes or in any of the other Loan Documents, the Borrowers additionally covenant
and agree with the Banks and Agent as follows:
(a) The Borrowers shall comply and continue to comply with all of
the terms, covenants and provisions contained in the Credit Agreement, the
Revolving Credit Notes and the other Loan Documents, except as such terms,
covenants and provisions are expressly modified by this Agreement upon the terms
set forth herein.
(b) The Borrowers will not effect or cause any amendment or
modification of the Receivable Servicing Agreement in any material respect
without the prior written consent of the Majority Banks.
(c) On or before March 31, 1997, the Borrowers shall file their
fiscal year 1995 tax returns and provide evidence of such filing to the Agent.
(d) The Borrowers shall at any time or from time to time execute
and deliver such further instruments, and take such further action as the Agent
and/or Banks may reasonably request, in each case further to effect the purposes
of this Agreement, the Credit Agreement, the Revolving Credit Notes and the
other Loan Documents.
Each of the Borrowers expressly acknowledges and agrees that any
failure by any Borrower to comply with the terms and conditions of this Section
6 or any other provisions contained in this Agreement shall constitute an Event
of Default under the Credit Agreement.
Section 7. Expenses. The Borrowers agree to pay to the Agent and the
Banks upon demand (a) an amount equal to any and all out-of-pocket costs or
expenses (including reasonable legal fees and disbursements) incurred or
sustained by the Agent and/or Banks in connection with the preparation of this
Agreement and related matters and (b) from time to time any and all
out-of-pocket costs or expenses (including commercial examiner fees and legal
fees and disbursements) hereafter incurred or sustained by the Agent and/or
Banks in connection with the administration of credit extended by the Banks and
the Agent to the Borrowers or the preservation of or enforcement of the Agent's
and the Banks' rights under the Credit Agreement, the Revolving Credit Notes or
the other Loan Documents or in respect of any of the Borrowers' other
obligations to the Banks and/or the Agent.
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Section 8. Miscellaneous Provisions.
(a) Except as otherwise expressly provided by this Agreement, all
of the respective terms, conditions and provisions of the Credit Agreement, the
Revolving Credit Notes and the other Loan Documents shall remain the same. It is
declared and agreed by each of the parties hereto that the Credit Agreement, the
Revolving Credit Notes and the other Loan Documents, each as amended hereby,
shall continue in full force and effect, and that this Agreement and the Credit
Agreement, the Revolving Credit Notes and the other Loan Documents, as
applicable, shall be read and construed as one instrument.
(b) This Agreement is intended to take effect under, and shall be
construed according to and governed by, the laws of the State of Connecticut.
(c) This Agreement may be executed in any number of counterparts,
but all such counterparts shall together constitute but one instrument. In
making proof of this Agreement it shall not be necessary to produce or account
for more than one counterpart signed by each party hereto by and against which
enforcement hereof is sought.
IN WITNESS WHEREOF, each of the parties hereto have caused this
Agreement to be executed in its name and behalf by its duly authorized officer
as of the date first written above.
XOMED SURGICAL PRODUCTS, INC.
By: /s/ Xxxxxx X. Xxxxxx
Its Vice President & CFO
MEROCEL CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
XOMED, INC.
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
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XOMED-XXXXXX, X.X. INC.
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
TREBAY MEDICAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
BANK OF BOSTON CONNECTICUT,
Individually and as Agent
By:_____________________________
Xxxxx X. Xxxxxxx
Its: Vice President
The undersigned Guarantors acknowledge
and accept the foregoing and ratify and
confirm their obligations under their
Unlimited Guaranties:
MEROCEL FOREIGN SALES CORP.
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
XOMED INTERNATIONAL, INC.
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
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XOMED CANADA, INC.
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
XOMED AUSTRALIA PTY LIMITED
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
XOMED U.K. LTD.
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
XOMED FRANCE, S.A.
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
XOMED DEUTSCHLAND, GMBH
By: /s/ Xxxxxx X. Xxxxxx
Its Treasurer
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Schedule 7.2
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Ownership Interests
