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Exhibit 10(r)
FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
This Amendment ("Amendment") is made as of the ______ day of October,
1999, (the "Agreement Date") by and between DMI FURNITURE, INC., a Delaware
corporation (the "Company") and BANK ONE, INDIANA, N.A. (the "Bank").
WHEREAS, the Company and the Bank entered into Amended and Restated
Credit Agreement dated October 3, 1997, as amended (collectively, the
"Agreement"); and
WHEREAS, the parties hereto desire to amend the Agreement as set forth
below:
NOW, THEREFORE, the parties hereto agree as follows:
1. Capitalized terms not defined herein shall have the meaning
ascribed in the Agreement.
5. The following new definition is added to Section 1.01 of the
Agreement to read as follows:
"FOURTH AMENDMENT" means the Fourth Amendment to Amended and
Restated Credit Agreement, dated as of the Agreement Date,
executed by the Company, Guarantor and the Bank.
6. The tables referred under the following definitions under
Section 1.01 of the Agreement are hereby amended and restated
in their entireties to read as follows:
"Applicable Credit Enhancement Letter of Credit Commission Rate"
----------------------------------------------------------------
Ratio of Total Applicable Credit
Funded Debt Enhancement Letter of Credit
to EBITDA Commission Rate
--------- ---------------
greater than =5.50 and above 2.00%
greater than =3.50 and less than 5.50 1.50%
greater than =2.50 and less than 3.50 1.25%
greater than =2.00 and less than 2.50 1.00%
"Applicable Documentary Letter of Credit Commission Rate"
---------------------------------------------------------
Ratio of Total Applicable Documentary
Funded Debt Letter of Credit
to EBITDA Commission Rate
--------- ---------------
greater than =4.00 and above 0.50%
greater than =2.00 and less than 4.00 0.375%
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"Applicable Spread I"
---------------------
If determining If determining
Ratio of Total a LIBOR-based a Prime-based
Funded Debt Rate on the Rate on the
to EBITDA Revolving Loan Revolving Loan
--------- -------------- --------------
greater than =5.50 and above 3.00% 0.25%
greater than =4.50 and less than 5.50 2.75% 0.25%
greater than =4.00 and less than 4.50 2.50% 0.25%
greater than =3.50 and less than 4.00 2.25% 0%
greater than =3.00 and less than 3.50 2.00% 0%
greater than =2.50 and less than 3.00 1.75% 0%
greater than =2.00 and less than 2.50 1.50% 0%
"Applicable Spread II"
----------------------
If determining If determining
Ratio of Total a LIBOR-based a Prime-based
Funded Debt Rate on the Rate on the
to EBITDA Term Loan Term Loan
--------- --------- ---------
greater than =5.50 and above 3.00% 0.25%
greater than =4.50 and less than 5.50 2.75% 0.25%
greater than =4.00 and less than 4.50 2.50% 0.25%
greater than =3.50 and less than 4.00 2.25% 0%
greater than =3.00 and less than 3.50 2.00% 0%
greater than =2.50 and less than 3.00 1.75% 0%
greater than =2.00 and less than 2.50 1.50% 0%
"Applicable Unused Commitment Fee Percentage"
---------------------------------------------
Ratio of Total Applicable
Funded Debt Unused Commitment
to EBITDA Percentage Fee
--------- --------------
greater than =4.00 and above 0.50%
greater than =3.00 and less than 4.00 0.375%
greater than =2.00 and less than 3.00 0.25%
7. A new subsection entitled Total Liabilities to Tangible Net Worth is
added to Section 6.01 entitled Affirmative Covenants of the Company to
read as follows:
(4) TOTAL LIABILITIES TO TANGIBLE NET WORTH RATIO. As of
the close of each fiscal quarter of the Company
ending after August 31, 1999, the Company, shall
have a Total Liabilities to Tangible Net Worth ratio
of not greater than 3.00 to 1.00.
8. Section 6.01(g)(2) and (3) of the Agreement are hereby amended and
restated in their entireties to read as follows:
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(2) FIXED CHARGE COVERAGE RATIO. As of the close of each
fiscal quarter of the company ending after August
31, 1999 and prior to May 30, 2000, the Company for
the period of the four consecutive fiscal quarters
which end on each such close, shall have a Fixed
Charge Coverage Ratio of not less than 1.05 to 1.00.
As of the close of each fiscal quarter of the
Company ending on or after May 31, 2000, the
Company, for the period of the four consecutive
fiscal quarters which end on each such close, shall
have a Fixed Charge Coverage Ratio of not less than
1.20 to 1.00.
(3) RATIO OF TOTAL FUNDED DEBT TO EBITDA. As of the
close of each fiscal quarter of the Company ending
after the Fourth Amendment Agreement Date, the
Company, for the period of the four consecutive
fiscal quarters shall have a Ratio of Total Funded
Debt to EBITDA of not greater than (i) 6.5 to 1.00
at the close of each fiscal quarter ending at any
time from Fourth Amendment Agreement Date to
November 28, 1999; (ii) 5.50 to 1.00 at the close of
each fiscal quarter ending at any time from November
29, 1999 to February 29, 2000, (iii) 4.50 to 1.00 at
the close of each fiscal quarter ending at any time
from March 1, 2000, to August 31, 2000, (iv) 4.00 to
1.00 at the close of each fiscal quarter ending at
any time from September 1, 2000 to August 31, 2001,
and (v) 3.25 to 1.00 at the close of each fiscal
quarter ending at any time from September 1, 2001 to
August 31, 2002, and (vi) 3.00 to 1.00 at the close
of each fiscal quarter ending at any time from and
after September 1, 2002.
6. The Company represents and warrants that (a) the representations and
warranties contained in the Agreement are true and correct in all
material respects as of the date of this Amendment, (b) no condition,
act or event which could constitute an Event of Default under the
Agreement exists, and (c) no condition, event, act or omission has
occurred, which, with the giving of notice or passage of time, would
constitute an Event of Default under the Agreement.
7. The Company agrees to pay all fees and out-of-pocket disbursements
incurred by the Bank in connection with this Amendment, including
legal fees incurred by the Bank in the preparation, consummation,
administration and enforcement of this Amendment.
8. This Amendment shall become effective only after it is fully executed
by the Company and the Bank and the Bank shall have received from the
Company the following documents:
(c) Fourth Amendment to Amended and Restated Credit Agreement
Except as amended by this Amendment, the Agreement shall remain in full force
and effect in accordance with its terms.
9. This Amendment is a modification only and not a novation. Except for
the above-quoted modification(s), the Agreement, any agreement or
security document, and all the terms and conditions thereof, shall be
and remain in full force and effect with the changes herein deemed to
be incorporated therein. This Amendment is to be considered attached
to the Agreement and made a part thereof. This Amendment shall not
release or affect the liability of any guarantor, surety or endorser
of the Agreement or release any owner of collateral securing the
Agreement. The validity, priority and enforceability of the Agreement
shall not be impaired hereby. To the extent that any provision of this
Amendment conflicts with any term or condition set forth in the
Agreement, or any agreement or security document executed in
conjunction therewith, the provisions of this Amendment shall
supersede and control. Company acknowledges that as of the date of
this Amendment it has no offsets with respect to all amounts owed by
Company to Bank and Company waives and releases all claims which it
may have against Bank arising under the Agreement on or prior to the
date of this Amendment.
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10. The Company acknowledges and agrees that this Amendment is limited to
the terms outlined above, and shall not be construed as an amendment
of any other terms or provisions of the Agreement; The Company hereby
specifically ratifies and affirms the terms and provisions of the
Agreement. Company releases Bank from any and all claims which may
have arisen, known or unknown, in connection with the Agreement on or
prior to the date hereof. This Amendment shall not establish a course
of dealing or be construed as evidence of any willingness on the
Bank's part to grant other or future amendments, should any be
requested.
IN WITNESS WHEREOF, the parties have entered into this Amendment as of
the day and year first above written.
BANK ONE, INDIANA, N.A. DMI FURNITURE, INC.
By: _______________________________ By: _________________________
Xxxxx X. Little, Vice President Xxxxxx X. Xxxx, VP/CFO
ACKNOWLEDGMENT AND AGREEMENT BY GUARANTOR AND/OR OWNER
OF COLLATERAL SECURING THE PROMISSORY NOTE
The undersigned (i) consent to the modification of the Agreement and all other
matters in the foregoing Amendment and, if a guarantor (ii) reaffirm the
Guaranty Agreement, dated June 9, 1994, and any other agreements, documents and
instruments securing or otherwise relating thereto ("Guarantor Documents"),
(iii) acknowledge that the Guarantor Documents continue in full force and
effect, remain unchanged, except as specifically modified hereby, and are valid,
binding and enforceable in accordance with their respective terms, (iv) agree
that all references, if any, in the Guarantor Documents to the Agreement are
modified to refer to that document as modified by the Amendment, and (v) agree
to be bound by the release of Bank set forth in the Amendment.
DMI MANAGEMENT, INC.
By: ____________________________
Xxxxxx X. Xxxx, CFO
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