1
EXHIBIT 10.21
FIFTH AMENDMENT
DATED AS OF OCTOBER 30, 1995
This FIFTH AMENDMENT (this "Amendment") is among DEP CORPORATION, a
Delaware corporation (the "Borrower"), the lenders party to the Credit Agreement
referred to below (the "Lenders"), and CITICORP USA, INC., as agent (the
"Agent") for the Lenders thereunder.
PRELIMINARY STATEMENTS:
(1) The Borrower, the Lenders and the Agent and The First National Bank
of Boston and City National Bank, as Co-Agents, have entered into a Revolving
Credit and Term Loan Agreement dated as of August 6, 1993 (as amended to date,
the "Credit Agreement"; the terms defined therein being used herein as therein
defined unless otherwise defined herein).
(2) Pursuant to the Waiver and Amendment dated as of March 17, 1994 (the
"First Amendment"), the Waiver and Amendment dated as of May 27, 1994 (the
"Second Amendment"), the Waiver and Amendment dated as of August 26, 1994 (the
"Third Amendment"), the Fourth Amendment dated as of September 9, 1994 (the
"Fourth Amendment"), the Conditional Waiver dated as of April 14, 1995 (the
"Conditional Waiver") and the Waiver dated as of September 29, 1995 (the
"Current Waiver"), the Lenders, among other things, have waived any Defaults
arising under certain financial covenants contained in Section 5.04 of the
Credit Agreement, modified the scheduled amortization of the Term Advances under
the Credit Agreement, and made certain other changes to the provisions of the
Credit Agreement. The Borrower has requested additional modifications to the
financial covenants contained in Section 5.04 and to such scheduled
amortization.
(3) The Lenders are, on the terms and conditions stated below, willing
to grant the requests of the Borrower in consideration for the other amendments
to the Credit Agreement set forth below.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
SECTION 1. AMENDMENTS TO CREDIT AGREEMENT. The Credit Agreement
is, effective as of the date hereof and subject to the satisfaction of the
conditions precedent set forth in Section 4 hereof, hereby amended as follows:
(a) Section 1.01 of the Credit Agreement is hereby amended by
amending and restating in their entirety the following defined terms to
read as follows:
"'Applicable Lending Office' means, with respect to each
Lender, such Lender's Domestic Lending Office."
"'Applicable Margin' means at any time of determination,
the rate per annum for Base Rate Advances equal to the then
applicable Base Rate Margin."
34
2
"'Base Rate Margin' means (i) from and including October
1, 1995 to and including June 30, 1996, 3% per annum, (ii) from
and including July 1, 1996 to and including September 30, 1996,
4% per annum and (iii) at all times thereafter, 5% per annum."
"'Business Day' means a day of the year on which banks are
not required or authorized to close in New York City."
"'Change of Control' means the occurrence of (i) any
Person or two or more Persons acting in concert shall have
acquired (by an acquisition approved by the board of directors of
the Borrower) after the date of the Fifth Amendment beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities and Exchange Act of
1934), directly or indirectly, of Common Stock of the Borrower
(or other securities convertible into such Common Stock)
representing 26% or more of the combined voting power of all
Common Stock of the Borrower, (ii) at any time after the date of
the Fifth Amendment, Xxxxxx Xxxxxxxx shall own beneficially
(including having the right to vote) less than 26% of the
combined voting power of all Common Stock of the Borrower or
(iii) at any time after the date of the Fifth Amendment, the
majority of the board of directors of the Borrower is not
comprised of 'Continuing Directors', which term shall mean those
individuals who on such date were directors of the Borrower and
those individuals subsequently elected or appointed whose
election or appointment was recommended or approved by a majority
of the Continuing Directors."
"'Current Assets' of any Person means all assets of such
Person that would, in accordance with GAAP, be classified as
current assets of a company conducting a business the same as or
similar to that of such Person, after deducting adequate reserves
in each case in which a reserve is proper in accordance with
GAAP, and, excluding all Cash and Cash Equivalents of such
Person."
"'Current Liabilities' of any person means all items
(including taxes accrued as estimated) that in accordance with
GAAP would be classified as current liabilities of such Person,
excluding, however, all amounts of Funded Debt of such Person
required to be paid or prepaid within one year after the date of
determination and all other amounts of Debt of such Person that
would be classified as short-term liabilities in accordance with
GAAP."
"'Termination Date' means the earlier of (i) December 31,
1996 and (ii) the date of termination in whole of the Lenders'
Total Commitments pursuant to Section 2.04, 2.05 or 6.01."
(b) Section 1.01 of the Credit Agreement is hereby further
amended by deleting in their entirety the defined terms "Conversion",
"Eurocurrency Liabilities", "Eurodollar Lending Office," "Eurodollar
Rate," "Eurodollar Rate Advance," "Eurodollar Rate Reserve Percentage,"
"Interest Period," "Eurodollar Rate Margin," "Eurodollar Rate
Reinstatement Date," "Principal Reduction Date," "Tier 1 Reduction
Event," and "Tier 2 Reduction Event."
(c) Section 1.01 of the Credit Agreement is hereby further
amended by adding thereto, in appropriate alphabetical order, the
following defined term:
35
3
"'Adjusted Net Sales' means, as of any date, the amount
equal to net sales of the Borrower and its Subsidiaries less
off-invoice discounts, in each case as reported in the financial
statements for the respective period of the Borrower and
determined in a manner consistent with financial statements of
the Borrower theretofore delivered to the Lenders."
"'Fifth Amendment' means the Fifth Amendment dated as of
October 30, 1995 among the Borrower, the Lenders and the Agent."
"'Inventory' means, as of any date, the inventory of the
Borrower and its Subsidiaries as reported in the financial
statements for the respective period of the Borrower and
determined in a manner consistent with financial statements of
the Borrower theretofore delivered to the Lenders."
"'Inventory Turnover' means, on a Consolidated basis for
the Borrower and its Subsidiaries, the ratio equal to (i) the
cost of goods sold for the twelve-month period ending on the
last day of the respective quarter divided by (ii) the quotient
of (A) the sum of (I) the quotient of (a) the sum of (q) the
dollar amount of Inventory at the beginning of the first fiscal
quarter in such twelve-month period and (r) the dollar amount of
Inventory at the end of such first fiscal quarter divided by (b)
two plus (II) the quotient of (c) the sum of (s) the dollar
amount of Inventory at the beginning of the second fiscal quarter
in such twelve-month period and (t) the dollar amount of
Inventory at the end of such second fiscal quarter divided by (d)
two plus (III) the quotient of (e) the sum of (u) the dollar
amount of Inventory at the beginning of the third fiscal quarter
in such twelve-month period and (v) the dollar amount of
Inventory at the end of such third fiscal quarter divided by (f)
two plus (IV) the quotient of (g) the sum of (w) the dollar
amount of Inventory at the beginning of the fourth fiscal quarter
in such twelve-month period and (x) the dollar amount of
Inventory at the end of such fourth fiscal quarter divided by (h)
two divided by (B) four."
"Receivables Days Outstanding' means, on a Consolidated
basis for the Borrower and its Subsidiaries, the number of days
equal to the product of 360 times the quotient of (i) the
quotient of (a) the sum of (I) the quotient of (A) the sum of (m)
the dollar amount of Receivables at the beginning of the first
fiscal quarter in the respective twelve-month period and (n) the
dollar amount of Receivables at the end of such first fiscal
quarter divided by (B) two plus (II) the quotient of (C) the sum
of (o) the dollar amount of Receivables at the beginning of the
second fiscal quarter in the respective twelve-month period and
(p) the dollar amount of Receivables at the end of such second
fiscal quarter divided by (D) two plus (III) the quotient of (E)
the sum of (q) the dollar amount of Receivables at the beginning
of the third fiscal quarter in the respective twelve-month period
and (r) the dollar amount of Receivables at the end of such third
fiscal quarter divided by (F) two plus (IV) the quotient of (G)
the sum of (s) the dollar amount of Receivables at the beginning
of the fourth fiscal quarter in the respective twelve-month
period and (t) the dollar amount of Receivables at the end of
such fourth fiscal quarter divided by (H) two divided by (b) four
divided by (ii) the net sales for the twelve-month period ending
on the last day of the respective quarter.
"'Receivables' means, as of any date, the accounts
receivable of the Borrower and its Subsidiaries as reported in
the financial statements for the respective period of the
Borrower and determined in a manner consistent with financial
statements of the Borrower theretofore delivered to the Lenders."
36
4
(d) Section 2.01(b) of the Credit Agreement is hereby amended by
adding to the end thereof the following sentence:
"Notwithstanding any provision of this Agreement or any other
Loan Document to the contrary, the aggregate principal amount
of Working Capital Borrowings outstanding at any one time on
and after October 1, 1995 shall not exceed $25,000,000 and
the Working Capital Commitments shall be reduced to
$25,000,000 on and after such date."
(e) Section 2.03(a) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
"SECTION 2.03. Repayment. (a) Term Advances. The Borrower
shall repay to the Agent for the ratable account of the Lenders
the aggregate outstanding principal amount of the Term Advances
(as of the date of the Fifth Amendment) in consecutive quarterly
installments on the dates set forth below, the amount payable on
each such installment being the amount set forth opposite such
installment below:
Installment Amount
----------- -------------
December 29, 1995 $ 500,000
April 1, 1996 500,000
April 15, 1996 8,300,000
July 1, 1996 1,375,000
September 30, 1996 1,875,000
December 30, 1996 22,044,316
provided, however, that the last such installment shall be in an
amount necessary to repay in full the unpaid aggregate principal
amount of the Term Advances."
(f) Section 2.04(b) of the Credit Agreement is hereby amended by
deleting subclause (y) therein, deleting the last sentence of such
Section and replacing such sentence with the following:
"Each such prepayment of any Term Advances shall be applied to
the installments thereof in inverse order of maturity."
(g) Section 2.05(a) of the Credit Agreement is hereby amended by
deleting the last sentence of such Section and replacing such sentence
with the following:
"Each such prepayment of Term Advances shall be applied to the
installments of the Term Advances in the inverse order of
maturity."
(h) Section 2.05(b) of the Credit Agreement is hereby amended by
deleting the last sentence of such Section and replacing such sentence
with the following:
"Each such prepayment under this Section 2.05(b) shall be applied
first to the installment of the Term Advances due on April 15,
1996 and after such amount is paid in full or after such date,
each such prepayment shall thereafter be applied ratably to the
unpaid installments of the Term Advances."
37
5
(i) Section 2.05(e) of the Credit Agreement is hereby amended by
deleting the second sentence of such Section and replacing such sentence
with the following:
"Each such prepayment under this Section 2.05(e) shall be applied
to the installments of the Term Advances in the inverse order of
maturity."
(j) Section 2.05(f) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
"(f) Tax Refund Proceeds. On the Business Day following
the later of the effective date of the Fifth Amendment or the
date of receipt by the Borrower or any of its Subsidiaries of
each refund of federal or state income taxes, the Borrower shall
prepay the Term Advances in an amount equal to one-half of such
proceeds, and such prepayment shall be applied to the
installments of the Term Advances in the inverse order of
maturity."
(k) Section 5.01(m) of the Credit Agreement is hereby amended by
adding to the end thereof the following sentence:
"To the extent not otherwise provided in the preceding sentence,
maintain all deposit accounts or investment accounts (including
all investment accounts permitted under Section 5.02(f)(iii)
hereof) with City National Bank, with such accounts and the
monies therein to be part of the Collateral for the Obligations
of the Borrower under the Loan Documents, provided that the
Borrower's access to such accounts shall not be restricted by the
Lenders except in the event that any payment to the Lenders has
not been made when due; and provided further, that such
requirement shall not be applicable to accounts in the United
Kingdom and Canada in the respective aggregate maximum amounts of
$100,000 and $500,000 (or their equivalent in the respective
currency), the lockbox account of the Borrower maintained at
Pittsburgh National Bank and the payroll account of the Borrower
maintained at Bank of America, N.T. & S.A. in Carson,
California."
(l) Sections 5.03(b) and (c) of the Credit Agreement are hereby
amended and restated in their entirety to read as follows:
"(b) Monthly/Year-to-Date Financials. As soon as available
and in any event within 20 days after the end of each month,
other than January, April, July, August and October, (A) a
Consolidated balance sheet of the Borrower and its Subsidiaries
as of the end of such month, (B) Consolidated statements of
income (which will include detailed expense disclosure) of the
Borrower and its Subsidiaries (including a breakdown of sales by
product line) for such month and the period commencing on the
first day of the fiscal year in which such month occurs and
ending on the last day of such month, and (C) Consolidated cash
flows of the Borrower and its Subsidiaries for such month,
setting forth in the case of subclause (B) above in comparative
form the corresponding figures for the corresponding period of
the preceding fiscal year and the corresponding figures from the
most recent business plan or forecasts, whichever is most recent,
delivered to the Lenders pursuant to Section 5.02 (e) hereof, in
the case of subclause (A) above in comparative form the
corresponding figures as of the end of the preceding fiscal year
and in the case of subclause (C) above in comparative form the
corresponding figures from the prior month's forecast for such
month delivered to the Lenders, all in reasonable detail and duly
certified by the chief financial officer of the Borrower that, to
the best of the knowledge of such financial officer, subject to
year-end adjustments, the financial information contained therein
fairly presents the financial condition of the Borrower and its
Subsidiaries. In addition, for all calendar months the Borrower
shall furnish to the
38
6
Lenders (i) as soon as available and in any event no later than
the first Business Day of each month, a report (in form and
detail acceptable to the Agent) of estimated cash flow (estimated
receipts and estimated disbursements) and (ii) on the twentieth
Business Day of each month, the Consolidated Net Sales for the
Borrower and its Subsidiaries for the first nineteen Business
Days of such month and with such Net Sales compared to the most
recent business plan or forecast for such month, whichever is
most recent, delivered to the Lenders.
(c) Quarterly Financials. As soon as available and in any
event within 30 days after the end of each fiscal quarter of the
Borrower, (A) a Consolidated balance sheet of the Borrower and
its Subsidiaries as of the end of such quarter, (B) Consolidated
statements of income (which will include detailed expense
disclosure) of the Borrower and its Subsidiaries (including a
breakdown of sales by product line for the following regions:
Domestic, Canada, Europe, Latin America, China, Australia, Japan
and Pacific Rim (to the extent not otherwise covered)) for such
quarter and the period commencing on the first day of the fiscal
year in which such quarter occurs and ending on the last day of
such quarter, and (C) Consolidated statements of cash flows of
the Borrower and its Subsidiaries for such quarter and the period
commencing on the first day of the fiscal year in which such
quarter occurs and ending on the last day of such quarter,
setting forth in the case of subclause (B) above in comparative
form (excluding comparisons of products by geographic region) the
corresponding figures for the prior quarter, the corresponding
figures for the corresponding period of the preceding fiscal year
and the corresponding figures from the most recent business plan
or most recent forecasts, whichever is most recent, delivered to
the Lenders pursuant to Section 5.02(e) hereof and in the case of
subclause (A) and (C) above in comparative form the corresponding
figures from the most recent plan or most recent forecasts,
whichever is most recent, delivered to the Lenders pursuant to
Section 5.02(e) hereof, all in reasonable detail and duly
certified (subject to year-end audit adjustments) by the chief
financial officer of the Borrower as having been prepared in
accordance with GAAP, together with (i) a certificate of said
officer stating that no Default has occurred and is continuing
or, if a Default has occurred and is continuing, a statement as
to the nature thereof and the action that the Borrower has taken
and proposes to take with respect thereto and (ii) a completed
compliance certificate, in substantially the form of Exhibit A to
the Fifth Amendment, duly executed by the chief financial officer
or chief executive officer of the Borrower."
(m) Section 5.03 (d) is amended by deleting the phrase "Exhibit
K" therein and substituting therefor the phrase "Exhibit A to the Fifth
Amendment."
(n) Section 5.03 of the Credit Agreement is hereby amended by
adding thereto new subsections (q) and (r) to read as follows:
"(q) Tax Refunds. Not more than five Business Days after
receipt of each notice thereof by the Borrower, notice that the
respective governmental entity has paid, approved, failed to
approve, challenged or taken any other action with respect to any
outstanding tax refund claim of the Borrower or any of its
Subsidiaries.
"(r) Donaldson, Lufkin, Xxxxxxxx. Periodically, at the
request of the Agent, but in any event not more than bi-weekly,
cause Xxxxxxxxx, Xxxxxx & Xxxxxxxx to provide information (which
can be done by telephone conference call) on the progress of its
efforts to identify one or more prospective purchasers of the
Borrower or portions thereof and to consummate any such purchase,
provided that, until the Borrower has entered into a letter of
intent or other agreement with respect to any such purchase, such
information need not
39
7
include the specific identity of such proposed purchasers or the
specific proposed purchase price (and whether such proposed
purchase is for the Borrower or specified portions thereof)."
(o) Section 5.04 of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
"SECTION 5.04. Financial Covenants. So long as any Advance
shall remain unpaid or any Lender shall have any Commitment
hereunder, the Borrower will, unless the Required Lenders
otherwise consent in writing:
(a) Working Capital. Maintain a ratio of Consolidated Current
Assets to Consolidated Current Liabilities of not less than 1.5
to 1.0.
(b) Fixed Charge Coverage Ratio. Maintain, for each period of
twelve consecutive months set forth below, a ratio of (i)
Consolidated EBITDA of the Borrower and its Subsidiaries for such
period minus the sum of (A) cash Capital Expenditures of the
Borrower and its Subsidiaries during such period, and (B)
Consolidated cash income taxes paid (net of any cash income tax
refunds received) by the Borrower and its Subsidiaries during
such period, to (ii) the sum of (A) interest payable on, and
amortization of debt discount in respect of, all Debt of the
Borrower and its Subsidiaries during such period and (B)
principal amounts of all Funded Debt payable by the Borrower and
its Subsidiaries during such period (but excluding from Funded
Debt, in the case of the fiscal quarter of the Borrower which
includes April 15, 1996, $8,300,000 of the installment stated to
be due on such date in respect of the Term Advances), of not less
than the ratio set forth below for the respective period:
Twelve Months
Ending Ratio
---------------- ----------
January 31, 1996 0.6 to 1.0
April 30, 1996 0.7 to 1.0
July 31, 1996 0.7 to 1.0
October 31, 1996 0.7 to 1.0
(c) Capital Expenditures. Not make, or permit any of its
Subsidiaries to make, any Capital Expenditures that would cause
the aggregate of all such Capital Expenditures made by the
Borrower and its Subsidiaries in any period of 12 consecutive
months to exceed an aggregate amount of $1,500,000.
(d) Adjusted Net Sales. Maintain Consolidated Adjusted Net
Sales, calculated on a fiscal year to date through and including
July 31, 1996 and thereafter on a rolling 12 month basis, as the
case may be, of the Borrower and its Subsidiaries in amounts not
less than those set forth below for the respective period:
Fiscal Year to Adjusted
Date Ending Net Sales
---------------- -----------
January 31, 1996 $45,500,000
April 30, 1996 69,500,000
July 31, 1996 94,500,000
40
8
Twelve Months
Ending
------------------
August 31, 1996 $95,300,000
September 30, 1996 95,300,000
October 31, 1996 95,300,000
(e) Inventory Turnover. Maintain Inventory Turnover not less
than the ratio set forth below at the end of the respective
fiscal quarter:
Minimum
Quarter Ending Inventory Turnover
---------------- ------------------
January 31, 1996 2.7 to 1.0
April 30, 1996 2.7 to 1.0
July 31, 1996 2.7 to 1.0
October 31, 1996 2.7 to 1.0
(f) Receivables Days Outstanding. Maintain Receivables Days
Outstanding not more than 52 days as of the end of each of the
quarters ending January 31, 1996, April 30, 1996, July 31, 1996
and October 31, 1996.
(g) Leverage Ratio. Maintain a ratio of Consolidated Total
Liabilities to Consolidated Net Worth of not greater than 8.5 to
1.0 as of the end of the quarter ending January 31, 1996 and not
greater than 7.4 to 1.0 as of the end of each quarter thereafter.
(p) (i) On and after October 1, 1995, all Advances will bear
interest as Base Rate Advances and all references in the Credit
Agreement to "Eurodollar Rate Advances" and related references will be
null and void and of no effect. In connection therewith and without
limitation thereof the following Sections are deleted from the Credit
Agreement: Section 2.06 (ii), Xxxxxxx 0.00, Xxxxxxxx 0.00(x), (x), (x)
and (e) and Section 8.04(c).
(ii) During the period from October 1, 1995 through the date this
Amendment becomes effective, interest will not accrue as provided in
Section 2.06(b) of the Credit Agreement as a result of any Specified
Default (as defined in the Current Waiver) but such limitation is not
effective with respect to any other Defaults or any other periods. The
Lenders hereby waive all such Specified Defaults during the period from
July 31, 1995 through the date of this Agreement.
SECTION 2. AMENDMENT TO TERM NOTES. Each Term Note is, effective
as of the date hereof and subject to the satisfaction of the conditions
precedent set forth in Section 5 hereof, hereby amended so that each principal
installment due under such Term Note after the date hereof shall be in such
amount as represents the ratable share of the Lender holding such Term Note of
the amount due in respect of the Term Advances on such date under Section
2.03(a) of the Credit Agreement as amended by this Amendment. Upon the
effectiveness of this Section 2 pursuant to Section 5 hereof, each Lender shall
endorse on the Term Note held by it the following legend:
"The respective amounts of the principal installments due under
this Note have been amended pursuant to the Fifth Amendment dated
as of October 30, 1995 among Dep Corporation, the Lenders party
to the Credit Agreement referred to in this Note, and the Agent
referred to in this Note."
41
9
SECTION 3. ADDITIONAL REPRESENTATIONS. As additional
consideration for the amendments to the Loan Documents as set forth herein, the
Borrower hereby represents and warrants to the Agent and the Lenders that:
(i) Except as set forth in Schedule 1 hereto, all the Equipment
and Inventory, in each case as defined in the Security Agreement, of the
Borrower and its Subsidiaries are located at the places specified in Schedule IV
to the Security Agreement, except for Inventory in transit;
(ii) To the extent required by Section 5.01(m) of the Credit
Agreement, all deposit accounts and investment accounts are maintained with City
National Bank, 00000 Xxxxxxxxx Xxxxxxxxx, Xxxxxxxx, XX 00000;
(iii) Each Loan Party (A) is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation; (B) is duly qualified and in good standing as a foreign
corporation in each other jurisdiction in which it owns or leases property or in
which the conduct of its business requires it to so qualify or be licensed
except where the failure to so qualify or be licensed would not have a Material
Adverse Effect; and (C) has all requisite corporate power and authority to own
or lease and operate its properties and to carry on its business as now
conducted and as proposed to be conducted, to execute and deliver, and to
perform its obligations under the Credit Agreement as amended by this Amendment;
(iv) The execution, delivery and performance by the Borrower of
this Amendment and each Guarantor of the Consent hereto and the consummation of
the transactions contemplated hereby and thereby, are within such Loan party's
corporate powers, have been duly authorized by all necessary corporate action,
and do not (A) contravene such Loan Party's charter or by-laws, (B) violate any
law, rule, regulation, order, writ, judgment, injunction, decree, determination
or award, (C) conflict with or result in the breach of, or constitute a default
under, any contract, loan agreement, instrument binding on or affecting any Loan
Party or any of their properties, or (D) result in or require the creation or
imposition of any Lien upon or with respect to any of the properties of any Loan
Party. No Loan Party is in violation of any such law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award or in breach of any
such contract, loan agreement, indenture, mortgage, deed of trust, lease or
other instrument, the violation or breach of which would have a Material Adverse
Effect;
(v) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body or any
other third party is required for the due execution, delivery, recordation,
filing or performance by the Borrower of this Amendment or any Guarantor of the
Consent hereto or for the consummation of the transactions contemplated hereby
and thereby;
(vi) This Amendment and the Consent hereto has been duly
executed and delivered by each Loan Party party thereto and this Amendment, the
Credit Agreement as amended by this Amendment and the Consent is the legal,
valid and binding obligation of each Loan Party party thereto, enforceable
against such Loan Party in accordance with its terms; and
(vii) There is no action, suit, investigation, litigation or
proceeding affecting any Loan Party, pending or threatened before any court,
governmental agency or arbitrator that (A) would have a Material Adverse Effect
or (B) purports to affect the legality, validity or enforceability of this
Amendment, the Credit Agreement or the Consent hereto or the transactions
contemplated hereby and thereby.
SECTION 4. ADDITIONAL COVENANTS. In consideration for the
amendments to the Loan Documents as set forth herein, the Borrower agrees (i) to
use its best efforts to deliver as soon as possible after the date hereof an
agreement from OMA University Properties in form and substance satisfactory
42
10
to the Agent as to, among other things, the right of the Agent to have access to
Collateral at premises leased by the Borrower from such entity and (ii) that the
amounts deposited in the Miscellaneous Accounts (as defined in Section 5(c)(vi)
hereof) will not at any time exceed $10,000 in any one account and that such
Accounts will be maintained for the same purposes as such Accounts are
maintained on the date hereof.
SECTION 5. CONDITIONS TO EFFECTIVENESS. This Amendment shall
become effective when:
(a) the Agent has executed this Amendment and has received
counterparts of this Amendment executed by the Borrower and each Lender
or, as to any of the Lenders, advice satisfactory to the Agent that such
Lender has executed this Amendment;
(b) the Agent has received counterparts of the Consent appended
hereto executed by the Guarantors and Grantors listed therein (such
Guarantors and Grantors, together with the Borrower, collectively the
"Loan Parties");
(c) the Agent has received all of the following documents, each
such document being in form and substance satisfactory to the Agent:
(i) certified copies of the resolutions of the Board of
Directors of each Loan Party approving this Amendment or the
Consent hereto, as applicable;
(ii) a certificate of the Borrower and each other Loan
Party, signed on behalf of the Borrower and such other Loan Party
by its President and its Secretary or an Assistant Secretary,
certifying as to (A) the due incorporation and good standing of
the Borrower, and such other Loan Party, as a corporation
organized under the laws of the state of its incorporation, and
the absence of any proceeding for the dissolution or liquidation
of the Borrower or such other Loan Party and (B) the absence of
any event occurring and continuing that constitutes a Default;
(iii) a certificate of the Secretary or an Assistant
Secretary of each of the Borrower and each other Loan Party
certifying the names and true signatures of the officers of the
Borrower or such other Loan Party authorized to sign this
Amendment or the consent hereto, as applicable;
(iv) a favorable opinion (addressed to the Agent and the
Lenders) of Kinsella, Boesch, Fujikawa & Xxxxx, counsel to the
Loan Parties, as to (A) the due incorporation, good standing and
corporate authority of each Loan Party, (B) the due
authorization, execution and delivery of this Amendment or the
Consent appended hereto, as the case may be, by each Loan Party,
(C) the execution, delivery and performance of this Amendment or
the Consent hereto, as the case may be, by each Loan Party not
contravening such Loan Party's charter or by-laws, not violating
any law, rule or regulation of the State of California or under
the Delaware General Corporation Law, and not conflicting with or
resulting in a breach of, or constituting a default under, any
agreement or instrument binding on or affecting such Loan Party
or any of its properties, and (D) such other matters as the Agent
or the Required Lenders may reasonably request;
(v) a favorable opinion (addressed to the Agent and the
Lenders) of Kavanagh, Peters, Xxxxxx & Xxxxxx, New York counsel
to the Loan Parties, as to (A) the execution, delivery and
performance of this Amendment or the Consent hereto, as the case
may be, by each Loan Party not violating any law, rule or
regulation of the State of New York,
43
11
(B) the valid, binding and enforceable nature of this Amendment
and the Credit Agreement, and the Notes, as amended hereby, and
(C) such other matters as the Agent or the Required Lenders may
reasonably request; and
(vi) to the extent not previously delivered to the Agent,
executed copies of notices to each bank in which the Borrower or
any Subsidiary maintains a deposit account with respect to the
security interest of the Agent therein, except in respect of
miscellaneous operating accounts (the "Miscellaneous Accounts")
in which the amounts therein do not exceed $10,000 in any such
Account;
(d) all fees and expenses of counsel for the Agent and any Lender
then due and payable shall be paid in full.
SECTION 6. GENERAL RELEASE OF CLAIMS. As additional consideration
for the amendments to the Loan Documents as set forth herein, the Borrower (by
its execution hereof) and each other Loan Party (by its execution of the Consent
appended hereto) and each of their respective agents, employees, directors,
officers, attorneys, affiliates, subsidiaries, successors and assigns
(individually, a "Releasing Party", and collectively, the "Releasing Parties")
each hereby release and forever discharge the Agent and each Lender and all of
their respective agents, direct and indirect shareholders, employees, directors,
officers, attorneys, branches, affiliates, subsidiaries, successors and assigns
(individually, a "Released Party", and collectively, the "Released Parties") of
and from all damage, loss, claims, demands, liabilities, obligations (except for
any such obligations pursuant to the terms of the Loan Documents, as amended
hereby), actions and causes of action whatsoever (collectively "Claims") the
Releasing Parties and each of them may, as of the date hereof, have or claim to
have against each of the Released Parties, in each case whether presently known
or unknown and of every nature and extent whatsoever on account of or in any way
relating to, arising out of or based upon the First Amendment, the Second
Amendment, the Third Amendment, the Fourth Amendment, the Conditional Waiver,
the Current Waiver or this Amendment (collectively, the "Restructuring
Amendments") or the negotiation or documentation thereof or the amendments to
the Loan Documents effected by the Restructuring Amendments or the transactions
contemplated thereby, including, without limitation, all such loss or damage of
any kind heretofore sustained, or that may arise as a consequence of the
dealings between the parties up to the date hereof in connection with or in any
way related to the Restructuring Amendments. Each Releasing Party further
covenants and agrees that it has not assigned heretofore, and will not hereafter
xxx any Released Party upon, any Claim released or purported to be released
under this Section 6, and the Borrower will indemnify and hold harmless said
Released Parties against any loss or liability on account of any actions brought
by any Releasing Party or its assigns or prosecuted on behalf of any Releasing
Party and relating to any Claim released or purported to be released under this
Section 6. This agreement and covenant on the part of the Releasing Parties,
respectively, is contractual, and not a mere recital, and the parties hereto
acknowledge and agree that no liability whatsoever is admitted on the part of
any party with respect to any Claim released or purported to be released under
this Section 6. It is further understood and agreed that any and all rights
under the provisions of Section 1542 of the California Civil Code are expressly
waived by each of the Releasing Parties. Section 1542 provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR."
Each of the Releasing Parties acknowledges that the foregoing
release (including the foregoing waiver of the provisions of Section 1542 of the
California Civil Code) was separately bargained for.
44
12
Each Released Party acknowledges (without admission as to the
existence of any specific fact) that the foregoing release shall not prevent any
Releasing Party from making evidentiary references, in connection with any Claim
not released or purported to be released hereby, to the negotiation or
documentation of the Restructuring Amendments or the amendments to the Loan
Documents effected by the Restructuring Amendments or the transactions
contemplated by the Restructuring Amendments or the dealings between the parties
in connection with or in any way related to the Restructuring Amendments.
The Borrower represents to each Released Party that, as of the
date hereof, neither Xxxxxx Xxxxxxxx nor Xxxxx Xxxxxxx has actual knowledge of
facts which would cause the Borrower to prevail on any Claim not released under
this Section 6.
SECTION 7. REFERENCE TO AND EFFECT ON THE LOAN DOCUMENTS. (a)
Upon the effectiveness of this Amendment, on and after the date hereof each
reference in the Credit Agreement or in any Term Note to "this Agreement" or
this "Note", "hereunder", "hereof" or words of like import referring to the
Credit Agreement or such Term Note, and each reference in the other Loan
Documents to "the Credit Agreement" or the "Term Notes" "thereunder", "thereof"
or words of like import referring to the Credit Agreement or the Term Notes,
shall mean and be a reference to the Credit Agreement or the Term Notes, as the
case may be, as modified and amended hereby.
(b) Except as specifically amended above, the Credit Agreement
and all other Loan Documents, are and shall continue to be in full force and
effect and are hereby in all respects ratified and confirmed. Without limiting
the generality of the foregoing, the Collateral Documents and all of the
Collateral described therein do and shall continue to secure the payment of all
Secured Obligations under and as defined therein, in each case as amended
hereby.
(c) The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of any Lender or the Agent under any of the Loan
Documents, nor constitute a waiver of any provision of any of the Loan
Documents.
(d) The Agent, each Lender party hereto, the Borrower and, by
execution of the Consent appended hereto, each Guarantor specifically
acknowledges and agrees that (i) none of the Company, any Guarantor, the Agent
or any Lender has agreed to any other or future waiver of or amendments to the
Loan Documents, (ii) neither the agreement to the amendments described herein
nor the granting of any prior waivers and amendments under the Loan Documents
creates any obligation whatsoever on the part of the Company, any Guarantor, the
Agent or any Lender to grant any other or future waiver or amendment under the
Loan Documents, and (iii) except as specifically set forth herein, each of the
Company, each Guarantor, the Agent and the Lenders have reserved all rights and
remedies under Loan Documents.
SECTION 8. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay
on demand (i) to the Agent, all reasonable costs and expenses of the Agent in
connection with the preparation, execution, delivery and administration of this
Amendment and the other instruments and documents to be delivered hereunder,
including, without limitation, the reasonable fees and out-of-pocket expenses of
counsel for the Agent with respect thereto and with respect to advising the
Agent as to its rights and responsibilities hereunder and thereunder, and (ii)
to each Lender, the reasonable fees and out-of-pocket expenses of counsel for
such Lender (including allocated costs of in-house counsel for such Lender) with
respect to this Amendment in an amount not in excess of $2,500 for each Lender.
The Borrower further agrees to pay on demand all reasonable costs and expenses,
if any (including, without limitation, reasonable counsel fees and expenses), in
connection with the enforcement (whether through negotiations, legal proceedings
or otherwise) of this Amendment and the other instruments and documents to be
delivered hereunder, including, without limitation, reasonable counsel fees and
expenses in connection
45
13
with the enforcement of rights under this Section 8. In addition, the Borrower
shall pay any and all stamp and other taxes, and fees, payable or determined to
be payable in connection with the execution, delivery and filing of this
Amendment and the other instruments and documents, if any, to be delivered
hereunder, and agrees to save the Agent and each Lender harmless from and
against any and all liabilities with respect to or resulting from any delay in
paying or omission to pay such taxes or fees.
SECTION 9. EXECUTION IN COUNTERPARTS. This Amendment may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute but
one and the same agreement. Delivery of an executed counterpart of a signature
page to this Amendment or the Consent hereto by telefacsimile shall be effective
as delivery of a manually executed counterpart of this Amendment or such
Consent.
SECTION 10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE AGENT
AND THE LENDERS HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE ACTIONS OF THE
AGENT OR ANY LENDER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT HEREOF.
SECTION 11. GOVERNING LAW. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed by their respective officers thereunto duly authorized, as of the
date first above written.
DEP CORPORATION
By /s/Xxxxx Xxxxxxx
-------------------------------------------
Title: Senior Vice President
CITICORP USA, INC., individually and as Agent
By /s/Xxxx X. Xxxx
-------------------------------------------
Title: Vice President
THE FIRST NATIONAL BANK OF BOSTON,
individually and as a Co-Agent
By /s/Xxxxx Xxxxxx
-------------------------------------------
Title: Vice President
46
14
CITY NATIONAL BANK,
individually and as a Co-Agent
By /s/Xxxx Xxxxxx
-------------------------------------------
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION
By: /s/Xxxxxx XxXxxx
-------------------------------------------
Title: Senior Vice President
ABN AMRO BANK N.V.
By: /s/Xxxxxx Xxxxx
-------------------------------------------
Title: Vice Pressident
By: /s/Xxxxxxx Xxxxxxxxxx
-------------------------------------------
Title: Authorized Signatory
THE DAIWA BANK, LTD.
By: /s/Xxxxxx X. Xxxxxxx
-------------------------------------------
Title: Vice President
By: /s/Xxxxx X. Xxxxxxxx
-------------------------------------------
Title: Vice President & Manager
BANK HAPOALIM, B.M.
By: /s/Xxxxxx Xxxxxxx
-------------------------------------------
Title: Senior Vice President
By: /s/Xxxxx Xxxxxxx
-------------------------------------------
Title: Vice President
47
15
CONSENT
DATED AS OF OCTOBER 30, 1995
The undersigned, Xxxxxxx-Dep Corporation, Topol-Dep Corporation
and Cuticura-Dep Corporation, as Guarantors under the "Guaranty" and as Grantors
under the "Security Agreements" executed by them, respectively, as defined in
and under the Credit Agreement referred to in the foregoing Fifth Amendment,
each hereby consents and agrees to the said Fifth Amendment and hereby confirms
and agrees that (i) the Guaranty and such Security Agreements are, and shall
continue to be, in full force and effect and are hereby ratified and confirmed
in all respects except that, upon the effectiveness of, and on and after the
date of, the said Fifth Amendment, each reference in the Guaranty and such
Security Agreements to the Credit Agreement or the Term Notes, "thereunder",
"thereof" or words of like import referring to the Credit Agreement or such Term
Notes, shall mean and be a reference to the Credit Agreement or the Term Notes,
as the case may be, as amended by the said Fifth Amendment and (ii) such
Security Agreements and all of the Collateral described therein do, and shall
continue to, secure the payment of all of the Secured Obligations as defined
therein.
XXXXXXX-DEP CORPORATION
By /s/Xxxxx Xxxxxxx
--------------------------------
Title: Senior Vice President
TOPOL-DEP CORPORATION
By /s/Xxxxx Xxxxxxx
--------------------------------
Title: Senior Vice President
CUTICURA-DEP CORPORATION
By /s/Xxxxx Xxxxxxx
--------------------------------
Title: Senior Vice President
48
