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EXHIBIT 10.2
ELEVENTH AMENDMENT TO CREDIT AGREEMENT
THIS ELEVENTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), dated
and effective as of August 17, 2000, is among DAISYTEK, INCORPORATED, a Delaware
corporation ("Borrower"), DAISYTEK INTERNATIONAL CORPORATION, a Delaware
corporation ("Guarantor"), each of Borrower's Subsidiaries identified under the
caption "SUBSIDIARY GUARANTORS" on the signature pages of this Amendment or
that, pursuant to Section 8.1(n) of the Credit Agreement (as hereinafter
defined), become a "Subsidiary Guarantor" (individually, a "Subsidiary
Guarantor," and, collectively, the "Subsidiary Guarantors"), CITIZENS BANK OF
MASSACHUSETTS, a Massachusetts stock savings bank, by assignment from State
Street Bank and Trust Company, a Massachusetts trust ("Citizens"), BANK ONE, NA
(Main Office Chicago), a national banking association formerly named The First
National Bank of Chicago ("Bank One"), IBM CREDIT CORPORATION, a Delaware
corporation ("IBM Credit"), and The Chase Manhattan Bank (successor by merger to
Chase Bank of Texas, National Association), a New York banking corporation
("Chase"), as a lender and as administrative agent for itself, Citizens, Bank
One and IBM Credit (Citizens, Bank One, IBM Credit, Chase and any assignee
lender pursuant to Section 11.4A of the Credit Agreement being referred to,
collectively, as "Lenders"). All capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to such terms in the Credit Agreement.
RECITALS
WHEREAS, Borrower, Guarantor, certain Subsidiary Guarantors, Citizens,
Bank One (as assignee, effective June 30, 1997, of NBD Bank, a Michigan banking
corporation) and Chase are parties to that certain Credit Agreement dated as of
May 22, 1995, as amended by that certain First Amendment to Credit Agreement
dated as of April 15, 1996, that certain Second Amendment to Credit Agreement
dated as of November 14, 1996 and effective as of November 18, 1996, that
certain Third Amendment to Credit Agreement dated and effective as of June 30,
1997, that certain Fourth Amendment to Credit Agreement dated and effective as
of December 11, 1997, that certain Fifth Amendment to Credit Agreement dated as
of February 13, 1998, that certain Sixth Amendment to Credit Agreement dated as
of March 29, 1999 and effective as of March 30, 1999 that certain Seventh
Amendment to Credit Agreement dated as of September 10, 1999, that certain
Eighth Amendment to Credit Agreement dated as of September 30, 1999, that
certain Ninth Amendment to Credit Agreement dated as of October 29, 1999 and
effective as of November 1, 1999, and that certain Tenth Amendment to Credit
Agreement dated as of July 11, 2000 (as so amended, the "Credit Agreement"),
establishing a revolving credit facility in the aggregate maximum principal
amount of $105,000,000; and
WHEREAS, the parties desire to amend the Credit Agreement to modify the
covenant obligating Guarantor and its consolidated subsidiaries to maintain a
minimum Consolidated Tangible Net Worth;
NOW, THEREFORE, in consideration of the recitals set forth above, the
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which
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are hereby acknowledged, Borrower, Guarantor, Subsidiary Guarantors and Lenders
hereby agree as follows:
1. Amendment of Section 8.2(d). Section 8.2(d) of the Credit Agreement
is amended to read in its entirety as follows:
"(d) Consolidated Tangible Net Worth. Consolidated Tangible
Net Worth will never be less than Thirty Four Million Dollars
($34,000,000) plus an amount (which amount, for purposes of this
section 8.2(d), shall be zero if actually less than zero) equal to at
any time fifty percent (50%) of Consolidated Net Earnings for the
period after March 31, 1995 to the date of determination, considered as
one accounting period, plus the gross proceeds, less offering and sale
expenses, of all sales of equity securities of Guarantor for the period
after February 2, 1995 to the date of determination, minus an amount,
not to exceed Twenty Five Million Dollars ($25,000,000) in the
aggregate, equal to Guarantor's treasury stock purchases subsequent to
June 30, 2000."
2. Conditions to Effectiveness. The effectiveness of this Amendment is
conditioned upon the prior receipt by Agent of any and all documents or
certificates reasonably requested by Agent in connection with the execution of
this Amendment.
3. Guaranties. Each of Guarantor and each Subsidiary Guarantor hereby
acknowledges, consents and agrees to this Amendment and (a) acknowledges that
its obligations under that certain Guaranty executed by it, in favor of a Lender
(or Agent for the benefit of Lenders) as the case may be, includes a guaranty of
all of the obligations, indebtedness and liabilities of Borrower under the
Credit Agreement as amended by this Amendment, (b) represents to each Lender
that such Guaranty remains in full force and effect and shall continue to be its
legal, valid and binding obligation, enforceable against it in accordance with
its terms, and (c) agrees that this Amendment and all documents executed in
connection herewith do not operate to reduce or discharge its obligations under
such Guaranty.
4. Other Documents. Borrower shall provide such other documents
incidental and appropriate to this Amendment as Agent or Agent's counsel may
reasonably request, all such documents to be in form and substance reasonably
satisfactory to Agent.
5. Terms of Agreement. Except as expressly amended by this Amendment,
the Credit Agreement is and shall be unchanged.
6. Effect of Amendment. The Credit Agreement and any and all other
documents heretofore, now or hereafter executed and delivered pursuant to the
terms of the Credit Agreement are hereby amended so that any reference to the
Credit Agreement in the Credit Agreement or the other documents shall mean a
reference to the Credit Agreement as amended hereby.
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7. Reaffirmation; No Default. Each Daisytek Corporation hereby
represents and warrants to Lenders that (a) the execution, delivery and
performance of this Amendment and any and all other Loan Documents executed and
delivered in connection herewith have been authorized by all requisite corporate
action on the part of such Daisytek Corporation and will not violate the
certificate of incorporation (or other charter documents) or bylaws of any
Daisytek Corporation, (b) the representations and warranties contained in the
Credit Agreement, as amended by this Amendment, and any other Loan Document are
true and correct on and as of the date hereof as though made on and as of the
date hereof, (c) no Event of Default has occurred and is continuing and no event
or condition has occurred that with the giving of notice or lapse of time or
both would be an Event of Default, and (d) each Daisytek Corporation is in full
compliance with all covenants and agreements contained in the Credit Agreement,
as amended hereby.
8. Enforceability. Each Daisytek Corporation hereby represents and
warrants that, as of the date of this Amendment, the Credit Agreement and all
documents and instruments executed in connection therewith are in full force and
effect and that there are no claims, counterclaims, offsets or defenses to any
of such documents or instruments.
9. GOVERNING LAW. THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS SHALL BE
DEEMED CONTRACTS AND INSTRUMENTS MADE UNDER THE LAWS OF THE STATE OF TEXAS AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
THE STATE OF TEXAS AND THE LAWS OF THE UNITED STATES OF AMERICA. PURSUANT TO
SECTION 346.004 OF THE TEXAS FINANCE CODE, CHAPTER 346 OF THE TEXAS FINANCE CODE
SHALL NOT APPLY TO THE CREDIT AGREEMENT, AS AMENDED BY THIS AMENDMENT, THE
NOTES, OR ANY ADVANCE OR LOAN EVIDENCED BY THE NOTES.
10. Maximum Interest Rate. Regardless of any provisions contained in
this Amendment or in any other Loan Documents, Lenders shall never be deemed to
have contracted for or be entitled to receive, collect or apply as interest on
the Notes or otherwise any amount in excess of the maximum rate of interest
permitted to be charged by applicable law, and if Lenders ever receive, collect
or apply as interest any such excess, or if acceleration of the maturity of the
Notes or if any prepayment by Borrower results in Borrower having paid any
interest in excess of the maximum rate, such amount which would be excessive
interest shall be applied to the reduction of the unpaid principal balance of
the Notes for which such excess was received, collected or applied, and, if the
principal balances of Notes are paid in full, any remaining excess shall
forthwith be paid to Borrower. All sums paid or agreed to be paid to Lenders for
the use, forbearance or detention of the indebtedness evidenced by the Notes
and/or the Credit Agreement, as amended by this Amendment, shall, to the extent
permitted by applicable law, be amortized, prorated, allocated and spread
throughout the full term of such indebtedness until payment in full so that the
rate or amount of interest on account of such indebtedness does not exceed the
maximum lawful rate permitted under applicable law. In determining whether or
not the interest paid or payable under any specific contingency exceeds the
maximum rate of interest permitted by law, Borrower and Lenders shall, to the
maximum extent permitted under applicable law, (i) characterize any
non-principal payment as an expense, fee or premium, rather than as interest;
and (ii) exclude voluntary prepayments and the effect thereof; and (iii) compare
the total amount of interest contracted for, charged or received with
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the total amount of interest which could be contracted for, charged or received
throughout the entire contemplated term of the Notes at the maximum lawful rate
under applicable law.
11. Counterparts. This Amendment may be separately executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to constitute one and the same
Amendment.
12. WAIVER OF TRIAL BY JURY. EACH DAISYTEK CORPORATION WAIVES ANY AND
ALL RIGHTS THAT IT MAY HAVE TO A TRIAL BY JURY ON ANY CLAIM, COUNTERCLAIM OR
OTHER ACTION, OF ANY NATURE WHATSOEVER, RELATING TO OR ARISING OUT OF THIS
AMENDMENT, ANY OF THE OTHER LOAN DOCUMENTS OR THE OBLIGATIONS. EACH DAISYTEK
CORPORATION ACKNOWLEDGES THAT THE FOREGOING JURY TRIAL WAIVER IS A MATERIAL
INDUCEMENT TO EACH LENDER'S ENTERING INTO THIS AMENDMENT AND THE OTHER LOAN
DOCUMENTS AND THAT EACH LENDER IS RELYING ON SUCH WAIVER IN ITS FUTURE DEALINGS
WITH SUCH CORPORATION. EACH SUCH CORPORATION WARRANTS AND REPRESENTS TO EACH
LENDER THAT SUCH CORPORATION HAS REVIEWED THE FOREGOING JURY TRIAL WAIVER WITH
ITS LEGAL COUNSEL AND HAS KNOWINGLY AND VOLUNTARILY WAIVED ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH SUCH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THE
FOREGOING JURY TRIAL WAIVER MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.
13. WAIVER OF CONSUMER/DTPA RIGHTS. EACH DAISYTEK CORPORATION HEREBY
WAIVES ALL OF ITS RIGHTS UNDER THE TEXAS DECEPTIVE TRADE PRACTICES-CONSUMER
PROTECTION ACT (TEX. BUS. & COM. CODE SECTION 17.41 ET SEQ.), A LAW THAT GIVES
CONSUMERS SPECIAL RIGHTS AND PROTECTIONS, AND REPRESENTS AND WARRANTS TO EACH
LENDER THAT SUCH CORPORATION (A) HAS KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND
BUSINESS MATTERS THAT ENABLE SUCH CORPORATION TO EVALUATE THE MERITS AND RISKS
OF THE TRANSACTIONS CONTEMPLATED BY THIS AMENDMENT, (B) IS NOT IN A
SIGNIFICANTLY DISPARATE BARGAINING POSITION, AND (C) IS REPRESENTED BY LEGAL
COUNSEL IN CONNECTION WITH SUCH TRANSACTIONS.
14. OTHER AGREEMENTS. THE CREDIT AGREEMENT, AS AMENDED BY THIS
AMENDMENT, AND THE OTHER LOAN DOCUMENTS EMBODY THE ENTIRE AGREEMENT BETWEEN THE
PARTIES AND SUPERSEDE ALL PRIOR AGREEMENTS AND UNDERSTANDINGS, IF ANY, RELATING
TO THE SUBJECT MATTER HEREOF AND THEREOF. THE WRITTEN CREDIT AGREEMENT, AS
AMENDED BY THIS AMENDMENT, REPRESENTS THE FINAL AGREEMENT AMONG THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES.
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THIS AMENDMENT is executed and effective as of the date first written
above.
BORROWER:
DAISYTEK, INCORPORATED
By:
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Name:
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Title:
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GUARANTOR:
DAISYTEK INTERNATIONAL
CORPORATION
By:
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Name:
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Title:
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SUBSIDIARY GUARANTORS:
DAISYTEK LATIN AMERICA, INC., a Florida
corporation
By:
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Name:
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Title:
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HOME TECH DEPOT, INC., a Delaware corporation
By:
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Name:
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Title:
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STEADI-SYSTEMS, LTD.,
a California corporation
By:
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Name:
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Title:
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STEADI SYSTEMS MIAMI, INC.,
a Florida corporation
By:
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Name:
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Title:
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STEADI SYSTEMS NEW YORK, INC.,
a New York corporation
By:
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Name:
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Title:
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STEADI-SYSTEMS ATLANTA, INC.,
a Georgia corporation
By:
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Name:
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Title:
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STEADI-SYSTEMS CHICAGO, INC.,
an Illinois corporation
By:
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Name:
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Title:
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SUPPLIES EXPRESS, INC., a Delaware corporation
By:
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Name:
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Title:
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THE TAPE COMPANY, INC., an Illinois
corporation
By:
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Name:
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Title:
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THE TAPE COMPANY, INC., a Georgia
corporation
By:
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Name:
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Title:
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THE TAPE COMPANY, INC., an Ohio
corporation
By:
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Name:
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Title:
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TAPE DISTRIBUTORS OF TEXAS, INC.,
a Texas corporation
By:
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Name:
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Title:
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BUSINESS SUPPLIES DISTRIBUTORS, INC.,
a Delaware corporation
By:
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Name:
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Title:
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ARLINGTON INDUSTRIES, INC.,
a Delaware corporation
By:
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Name:
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Title:
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X.X. XXXXX COMPANY,
a Delaware corporation
By:
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Name:
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Title:
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XXXXXXXXXXXXX.XXX,
a Delaware corporation
By:
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Name:
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Title:
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TAPE DISTRIBUTORS, INC.,
a Pennsylvania corporation
By:
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Name:
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Title:
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TAPE DISTRIBUTORS OF MINNESOTA, INC.,
a Minnesota corporation
By:
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Name:
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Title:
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AGENT:
CHASE BANK OF TEXAS, N.A.,
a national banking association
By:
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Name:
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Title:
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LENDERS:
CHASE BANK OF TEXAS, N.A.
a national banking association
By:
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Name:
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Title:
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CITIZENS BANK OF
MASSACHUSETTS, a Massachusetts stock
savings bank
By:
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Xxxxxxx St. Xxxx,
Vice President
BANK ONE, NA (Main Office Chicago), a
national banking association
By:
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Xxxxx Xxxxxx, Authorized Agent
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IBM CREDIT CORPORATION, a Delaware
corporation
By:
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Name:
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Title:
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