Exhibit 10.2
TWELFTH AMENDMENT TO CREDIT AGREEMENT
This Twelfth Amendment to Credit Agreement ("Agreement") is effective
as of the 13th day of May, 2002, by and among ADVANCED LIGHTING TECHNOLOGIES,
INC., an Ohio corporation ("U.S. Borrower"), VENTURE LIGHTING POWER SYSTEMS,
NORTH AMERICA INC. (f.k.a. Canadian Lighting Systems Holding, Incorporated), a
corporation organized under the laws of the Province of Nova Scotia ("Canadian
Borrower"), PARRY POWER SYSTEMS LIMITED (Company No. 2833448, f.k.a. Venture
Lighting Europe Ltd.), incorporated under the laws of England, VENTURE LIGHTING
EUROPE LTD. (Company No. 3341889, f.k.a. Parry Power Systems Limited),
incorporated under the laws of England (collectively, "UK Borrowers" and,
individually, "UK Borrower", and together with U.S. Borrower and Canadian
Borrower, collectively, "Borrowers" and, individually, "Borrower"), the banking
institutions listed on SCHEDULE 1 (as amended herein) to the Credit Agreement,
as hereinafter defined ("Banks"), and PNC BANK, NATIONAL ASSOCIATION, as agent
for the Banks ("Agent"):
WHEREAS, Borrowers, Agent and the Banks are parties to a certain Credit
Agreement dated as of May 21, 1999, as the same has been amended from time to
time (the "Credit Agreement");
WHEREAS, Borrowers, Agent and the Banks desire to further amend the
Credit Agreement as set forth herein.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants contained in this Agreement and for other valuable considerations,
Borrowers, Agent and the Banks hereby agree as follows:
1. WAIVER. Each of the Banks hereby waives the Event of Default of the
U.S. Borrower under Section 7.2 of the Credit Agreement relating to performance
or observance of Section 5.7(a) of the Credit Agreement which Event of Default
occurred for the period ended March 31, 2002.
2. CREDIT AGREEMENT AMENDMENTS. The Credit Agreement is amended as
follows:
(a) Notwithstanding anything to the contrary contained in the
Credit Agreement, (I) each loan based on the Eurodollar Rate outstanding as of
the date hereof shall be deemed to have converted to a Base Rate Loan at the end
of the applicable Interest Period, and (II) after the date hereof, Borrowers
shall not be entitled to convert or borrow any loans based on the Eurodollar
Rate until (a) the Fixed Charge Coverage Ratio of U.S. Borrower, based on the
Consolidated financial statements of U.S. Borrower, is not less than 1.00 to
1.00 for any twelve (12) month period ending on June 30, September 30, December
31 or March 31, commencing June 30, 2002, and (b) each of the Banks, in their
sole discretion, specifically approve such Eurodollar Rate borrowings.
(b) Article I of the Credit Agreement is hereby amended to
delete the definition of "Cash Flow" in its entirety and insert in lieu thereof
the following:
"`Cash Flow' shall mean for any period, on a Consolidated
basis and in accordance with GAAP, the sum of (a) Earnings Before Interest and
Taxes for such period, plus (b) depreciation and amortization that were deducted
in determining Consolidated Net Income for such period, plus (c) non-cash
charges (other than depreciation and amortization, allowances for doubtful
accounts and unpaid accruals, and non-cash charges in cost of goods sold), minus
(d) Capital Expenditures less (i) proceeds from asset dispositions for such
period and (ii) Capital Expenditures not funded from the proceeds of any Loan,
minus (e) cash Taxes actually paid, minus (f) cash payments in respect of
non-cash charges accounted for prior to September 30, 2001."
(c) The third paragraph of Section 2.1(A)(2)(b) of the Credit
Agreement is hereby deleted in its entirety and is hereby replaced with the
following:
"In respect of each UK Letter of Credit and the drafts
thereunder, if any, issued for the account of a UK Borrower, UK Borrowers agree
(i) to pay to Agent, for the pro rata benefit of the Banks, (A) with respect to
each UK Letter of Credit that is a standby letter of credit, a commission based
upon the face amount of the UK Letter of Credit, which shall be paid quarterly
in arrears, on the first day of each July, October, January and April, at a rate
per annum equal to (1) 275 basis points, times (2) the average undrawn face
amount of such UK Letter of Credit during such fiscal quarter, and (B) with
respect to each UK Letter of Credit that is a commercial documentary letter of
credit, a non-refundable commission based upon the face amount of the UK Letter
of Credit, which shall be paid on the date that any draw is made on a UK Letter
of Credit, in an amount equal to (1) 275 basis points, times (2) the amount
drawn under the UK Letter of Credit; (ii) to pay to Agent, for the sole account
of the Fronting Bank, an additional UK Letter of Credit fee, which shall be paid
on each date that such UK Letter of Credit is issued or renewed at the rate of
one-eighth percent (1/8 of 1%) of the face amount of such UK Letter of Credit;
and (iii) to pay to Agent for the sole account of the Fronting Bank, such other
issuance, amendment, negotiation, draw, acceptance, telex, courier, postage and
similar transactional fees as are generally charged by the Fronting Bank under
its fee schedule as in effect from time to time."
(d) The third paragraph of Section 2.1(A)(3)(b) of the Credit
Agreement is hereby deleted in its entirety and is hereby replaced with the
following:
"In respect of each Canadian Letter of Credit and the drafts
thereunder, if any, issued for the account of Canadian Borrower, Canadian
Borrower agrees (i) to pay to Agent, for the pro rata benefit of the Canadian
Banks, (A) with respect to each Canadian Letter of Credit that is a standby
letter of credit, a commission based upon the face amount of the Canadian Letter
of Credit, which shall be paid quarterly in arrears, on the first day of each
July, October, January and April, in an amount per annum equal to (1) 275 basis
points, times (2) the average undrawn face amount of such Canadian Letter of
Credit during such fiscal quarter, and (B) with respect to each Canadian Letter
of Credit that is a commercial documentary letter of credit, a nonrefundable
commission based upon the face amount of the Canadian Letter of Credit, which
shall be paid on the date that any draw is made on a Canadian Letter of Credit,
in an amount equal to (1) 275 basis points, times (2) the amount drawn under the
Canadian Letter of Credit; (ii) to pay to Agent, for the sole account of the
Fronting Bank, an additional Canadian Letter of Credit fee, which shall be paid
on each date that such Canadian Letter of Credit is issued or renewed at the
rate of one-eighth percent (1/8 of 1%) of the face amount of such Canadian
Letter of Credit; and (iii) to pay to Agent for the sole account of the Fronting
Bank, such other issuance, amendment, negotiation, draw, acceptance, telex,
courier, postage and similar transactional fees
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as are generally charged by the Fronting Bank under its fee schedule as in
effect from time to time."
(e) The third paragraph of Section 2.1(A)(4) of the Credit
Agreement is hereby deleted in its entirety and is hereby replaced with the
following:
"In respect of each U.S. Letter of Credit and the drafts
thereunder, if any, whether issued for the account of U.S. Borrower or a U.S.
Guarantor, U.S. Borrower agrees (a) to pay to Agent, for the pro rata benefit of
the Banks, (i) with respect to each U.S. Letter of Credit that is a standby
letter of credit, a commission based upon the face amount of the U.S. Letter of
Credit, which shall be paid quarterly in arrears, on the first day of each July,
October, January and April, at a rate per annum equal to (A) 275 basis points,
times (B) the average undrawn face amount of such U.S. Letter of Credit during
such fiscal quarter, and (ii) with respect to each U.S. Letter of Credit that is
a commercial documentary letter of credit, a nonrefundable commission based upon
the face amount of the U.S. Letter of Credit, which shall be paid on the date
that any draw is made on a U.S. Letter of Credit, in an amount equal to (A) 275
basis points, times (B) the amount drawn under the U.S. Letter of Credit; (b) to
pay to Agent, for the sole account of the Fronting Bank, an additional U.S.
Letter of Credit fee, which shall be paid on each date that such U.S. Letter of
Credit is issued or renewed at the rate of one-eighth percent (1/8 of 1%) of the
face amount of such U.S. Letter of Credit; and (c) to pay to Agent for the sole
account of the Fronting Bank, such other issuance, amendment, negotiation, draw,
acceptance, telex, courier, postage and similar transactional fees as are
generally charged by the Fronting Bank under its fee schedule as in effect from
time to time."
(f) Section 5.7(a) of the Credit Agreement is hereby deleted
in its entirety and is hereby replaced the following:
"(a) U.S. Borrower shall maintain a Fixed Charge Coverage
Ratio, based upon the Consolidated financial statements of U.S. Borrower for the
most recently completed four (4) fiscal quarters (except as otherwise specified
in (i), (ii) and (iii) hereof), as follows: (i) for the three (3) months ending
June 30, 2002, not less than 1.00 to 1.00; (ii) for the six (6) months ending
September 30, 2002, not less than 1.00 to 1.00; (iii) for the nine (9) months
ending December 31, 2002, not less than 1.00 to 1.00; and (iv) for each period
ending March 31, 2003 (on a rolling four quarter basis) and thereafter, not less
than 1.00 to 1.00."
4. CLOSING CONDITIONS. The obligation of the Banks to enter into and
perform this Agreement is subject to each of the following conditions:
(a) Each of the parties hereto shall have delivered to Agent
or its counsel duly executed counterparts of this Agreement;
(b) Borrowers shall have paid Agent, for the benefit of the
Banks, an amendment fee of Forty Thousand Dollars ($40,000); and
(c) Borrowers shall have paid all legal fees and expenses of
Agent in connection with this Agreement.
5. REPRESENTATIONS AND WARRANTIES. Borrowers hereby represent and
warrant to Agent and the Banks that (a) each Borrower has the legal power and
authority to execute and deliver this Agreement; (b) the officers executing this
Agreement have been duly authorized to
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execute and deliver the same and bind such Borrower with respect to the
provisions hereof; (c) the execution and delivery hereof by Borrowers and the
performance and observance by Borrowers of the provisions hereof do not violate
or conflict with the organizational agreements of any Borrower or any law
applicable to any Borrower or result in a breach of any provision of or
constitute a default under any other agreement, instrument or document binding
upon or enforceable against any Borrower; (d) no Unmatured Event of Default or
Event of Default exists under the Credit Agreement (except for the Event of
Default waived by the Banks pursuant to Section 1 of this Agreement), nor will
any occur immediately after the execution and delivery of this Agreement or by
the performance or observance of any provision hereof; (e) neither Borrower nor
any Guarantor of Payment is aware of any claim or offset against, or defense or
counterclaim to, any of Borrowers' or any Guarantor of Payment's obligations or
liabilities under the Credit Agreement or any Related Writing; and (f) this
Agreement constitutes the valid and binding obligations of each Borrower in
every respect, enforceable in accordance with its terms.
6. REAFFIRMATION OF CREDIT AGREEMENT. Each of the representations and
warranties contained in the Credit Agreement is true and correct in all material
respects on and as of the date hereof as if made on the date hereof, except to
the extent such representations and warranties expressly relate to an earlier
date. Except as expressly provided in this Agreement, nothing contained in this
Agreement will in any manner waive, supplement, release, modify or limit any
obligation of any Borrower or Obligor to comply with each of the terms and
conditions of the Credit Agreement or any Loan Document nor any of Agent's or
the Banks' rights and privileges with respect thereto.
7. DOCUMENT REFERENCES. Each reference that is made in the Credit
Agreement shall hereafter be construed as a reference to such document as
amended hereby. Except as herein otherwise specifically provided, all provisions
of the Credit Agreement shall remain in full force and effect and be unaffected
hereby. This Agreement is a Related Writing as defined in the Credit Agreement.
All capitalized terms used herein have the meanings ascribed thereto in the
Credit Agreement.
8. WAIVER AND RELEASE. Each Borrower and each Guarantor of Payment, by
signing below, hereby waives and releases Agent and each of the Banks and their
respective directors, officers, employees, attorneys, affiliates and
subsidiaries from any and all claims, offsets, defenses and counterclaims of
which any Borrower and any Guarantor of Payment is aware, such waiver and
release being with full knowledge and understanding of the circumstances and
effect thereof and after having consulted legal counsel with respect thereto.
9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, by different parties hereto in separate counterparts and by
facsimile signature, 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.
10. GOVERNING LAW. The rights and obligations of all parties hereto
shall be governed by the laws of the State of Ohio, without regard to principles
of conflicts of laws.
11. JURY TRIAL WAIVER. BORROWERS, AGENT AND EACH OF THE BANKS WAIVE ANY
RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT OR OTHERWISE, AMONG ANY BORROWER, AGENT AND THE BANKS, OR ANY
THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP
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ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY NOTE OR OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH
OR THE TRANSACTIONS RELATED THERETO. THIS WAIVER SHALL NOT IN ANY WAY AFFECT,
WAIVE, LIMIT, AMEND OR MODIFY AGENT'S OR ANY BANK'S ABILITY TO PURSUE REMEDIES
PURSUANT TO ANY CONFESSION OF JUDGMENT OR COGNOVIT PROVISION CONTAINED IN ANY
NOTE OR OTHER INSTRUMENT, DOCUMENT OR AGREEMENT BETWEEN BORROWERS, AGENT AND THE
BANKS, OR ANY THEREOF.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
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Agreed to and accepted this 13th day of May, 2002.
ADVANCED LIGHTING TECHNOLOGIES, VENTURE LIGHTING POWER
INC. SYSTEMS NORTH AMERICA INC. (fka
Canadian Lighting Systems Holding,
Incorporated)
By: /s/ Xxxxxx X. Xxxxx By: /s/ R. Xxxxxxx Xxxxxx
-------------------------------- --------------------------------
Xxxxxx X. Xxxxx, Title: VP-Finance & Administration
Chief Financial Officer -----------------------------
VENTURE LIGHTING EUROPE PARRY POWER SYSTEMS LIMITED
LTD.
By: /s/ X. Xxxxx By: /s/ S. D. Xxxxxx
-------------------------------- --------------------------------
Title: Director Title: Director
----------------------------- -----------------------------
NATIONAL CITY COMMERCIAL SOVEREIGN BANK
FINANCE, INC.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxxxx X. Xxxxxxx
-------------------------------- --------------------------------
Title: Vice President Title: Senior Vice President
----------------------------- -----------------------------
PNC BANK, NATIONAL ASSOCIATION,
as Agent and as a Bank
By: /s/ Xxxxxxx X. Xxxx, Xx
--------------------------------
Title: Vice President
-----------------------------
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GUARANTOR ACKNOWLEDGMENT
Each of the undersigned consents and agrees to and acknowledges the
terms of the foregoing Agreement. Each of the undersigned further agrees that
the obligations of each of the undersigned pursuant to the Guaranty of Payment
executed by each of the undersigned shall remain in full force and effect and be
unaffected hereby.
ADLT Realty Corp. I, Inc.
ADLT Services, Inc.
APL Engineered Materials, Inc.
Ballastronix (Delaware), Inc.
Lighting Resources International, Inc.
Microsun Technologies, Inc.
Venture Lighting International, Inc.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
-----------------------------------
Title: Chief Financial Officer
----------------------------------
of each of the companies listed above
Deposition Sciences, Inc.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
-----------------------------------
Title: Chief Financial Officer
----------------------------------
signing for each of the companies listed
above by Power of Attorney
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