EXHIBIT 4
SECOND AMENDMENT TO REVOLVING CREDIT AGREEMENT
This Second Amendment to Revolving Credit Agreement (this "Amendment") is
entered into at Columbus, Ohio, by and between The Huntington National Bank, as
lender (the "Bank"), and X.X. Xxxxx Corporation, as borrower (the "Borrower"),
as of the 23rd day of September, 2002, in order to amend the Revolving Credit
Agreement entered into by and among the Bank and the Borrower as of the 12th day
of March, 2001 (the "Credit Agreement").
Whereas, the parties to this Amendment desire to amend certain of the
provisions of the Credit Agreement, the Credit Agreement is hereby amended as
follows:
1. Section 1 of the Credit Agreement is hereby amended to recite in its
entirety as follows:
SECTION 1. COMMITMENT.
1.1. Basic Commitment Terms. The Borrower has applied to the Bank
for revolving credit loans up to an aggregate principal amount of
$30,000,000, the proceeds of which are to be used by the Borrower for
general corporate purposes, including, without limitation, seasonal
financing of inventory and accounts receivable. The Borrower has also
applied to the Bank for a loan in the principal amount of $2,000,000,
the proceeds of which are to be used by the Borrower for general
corporate purposes and which loan is to mature on November 22, 2002.
The Bank is willing to make such loans to the Borrower upon the terms
and subject to the conditions hereinafter set forth up to a maximum
aggregate principal amount not in excess of $32,000,000 (said amount
being hereinafter called the "Commitment" of the Bank).
Notwithstanding anything to the contrary contained in any Note
evidencing the Loan, the principal amount advanced by the Bank
pursuant to the Notes held by the Bank shall not exceed the amount of
the Bank's Commitment.
1.2. Commitment Limitations. Notwithstanding the foregoing,
during the following periods in each year occurring during the term of
this Agreement, the aggregate Commitment of the Bank shall be in an
amount equal to the lesser of the following amounts or the amount to
which the Commitment has been reduced pursuant to Section 4.6 hereof.
PERIOD COMMITMENT
From 12/31 through 1/31 $0
From 02/01 through 02/28 $3,000,000
From 03/01 through 03/31 $15,000,000
From 04/01 through 11/29 $32,000,000
From 11/30 through 12/30 $27,000,000
1.3 BORROWING BASE. Notwithstanding the foregoing provisions of
Sections 1.1 and 1.2, the aggregate principal balance of the Loans at
any time outstanding shall not exceed the lesser of (a) the Commitment
of the Bank, reduced as provided in Section 1.2 and (b) the Borrowing
Base (as hereinafter defined). As used herein, "Borrowing Base" shall
mean the sum of (i) 80% of the Company's Eligible Accounts plus (ii)
40% of the Company's Eligible Inventory.
2. Section 3.35 of the Credit Agreement is hereby amended to recite in its
entirety as follows:
3.35 "Note" or "Notes" means the Revolving Credit Note or
Revolving Credit Notes as defined in Section 4.2.
3. Section 4.2 of the Credit Agreement is hereby amended to recite in its
entirety as follows:
4.2 EVIDENCE OF LOANS MADE UNDER REVOLVING CREDIT. All Loans made
by the Bank pursuant to the Bank's Commitment shall be evidenced by
one or more promissory notes substantially in the form attached hereto
as EXHIBIT A (hereinafter called the "Revolving Credit Note" or
"Revolving Promissory Notes"), payable to the order of the Bank, duly
executed on behalf of the Borrower. The Bank is hereby authorized by
the Borrower to note on the schedule attached to each Revolving Credit
Note the date, amount and type of each Loan made to the Borrower, the
duration of the related Interest Period if applicable, the amount of
each payment or prepayment of principal thereon, and the other
information provided for on such schedule, which schedule shall
constitute PRIMA FACIE evidence of the information so noted; provided,
that failure of the Bank to make any such notation shall not relieve
the Borrower of its obligation to repay the outstanding principal
amount of any Loan or Loans made to it, all accrued interest thereon
and all other amounts payable in accordance with the terms of the
Revolving Credit Notes or this Agreement. Interest on the Loans
evidenced by the Revolving Credit Notes shall be payable at the rates
specified in Sections 3.2 and 3.19 hereof and on each Interest Payment
Date, as hereinafter defined. The terms and conditions of this
Agreement are incorporated in the Revolving Credit Notes by reference
as though the same were written therein.
4. Section 9.2 of the Credit Agreement is hereby amended to recite in its
entirety as follows:
9.2 MAINTENANCE OF CONSOLIDATED TANGIBLE NET WORTH. Permit
Consolidated Tangible Net Worth to be less than (i) $46,500,000 as of
Xxxxx 00, 0000, (xx) $43,500,000 as of June 29, 2002, (iii)
$45,000,000 as of September 28, 2002, and (iv) $53,000,000 as of
December 28, 2002, and as of the end of each fiscal quarter
thereafter.
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5. The Bank and the Borrower hereby agree that the requirements of Section
9.13 of the Credit Agreement with respect to the maintenance of EBITDA in a
required amount shall not be applicable for the testing date of September 28,
2002, for the three quarters ending on that date, provided that the Borrower
remains in compliance with all the other terms and conditions of the Credit
Agreement on and after that date. The Borrower's obligation as to the
maintenance of EBITDA as of the testing date of December 28, 2002, for the four
quarters then ending, shall remain as stated in the Credit Agreement.
6. The Borrower represents and warrants that no Event of Default has
occurred and is continuing, nor will any occur immediately after the execution
and delivery of this Amendment by the performance or observance of any provision
hereof.
7. Each reference to the Credit Agreement, whether by use of the phrase
"Credit Agreement," "Agreement," the prefix "herein" or any other term, and
whether contained in the Credit Agreement itself, in this Amendment, in any
document executed concurrently herewith or in any loan documents executed
hereafter, shall be construed as a reference to the Credit Agreement as amended
by this Amendment.
8. Except as previously amended and as modified herein, the Credit
Agreement and the Loan Documents shall remain as written originally and in full
force and effect in all respects, and nothing herein shall affect, modify, limit
or impair any of the rights and powers which the Banks may have thereunder.
9. The Borrower agrees to perform and observe all the covenants,
agreements, stipulations and conditions to be performed on its part under the
Credit Agreement, the promissory note executed and delivered in connection
herewith, the Loan Documents, and all other related agreements, as amended by
this Amendment.
10. The Borrower hereby represents and warrants to the Bank that (a) the
Borrower has legal power and authority to execute and deliver the within
Amendment; (b) the respective officer executing the within Amendment on behalf
of the Borrower has been duly authorized to execute and deliver the same and
bind the Borrower with respect to the provisions provided for herein; (c) the
execution by the Borrower and the performance and observance by the Borrower of
the provisions hereof do not violate or conflict with the articles of
incorporation, regulations or by-laws of the Borrower or any law applicable to
the Borrower or result in the breach of any provision of or constitute a default
under any agreement, instrument or document binding upon or enforceable against
the Borrower; and (d) this Amendment and the promissory notes executed and
delivered in connection herewith constitute valid and legally binding
obligations upon the Borrower, subject to applicable bankruptcy, insolvency,
reorganization or other similar laws affecting creditors' rights generally, to
general equitable principles and to applicable doctrines of commercial
reasonableness.
11. This Amendment shall become effective only upon the occurrence of all
the following: (a) the execution by the Borrower and the Bank of this Amendment;
(b) the execution by the Borrower and delivery to the Bank of a Revolving
Promissory Note in the amount of $2,000,000 as described in this Amendment.
Execution of this Amendment by the parties hereto
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may be in any number of counterparts, but all of such counterparts when taken
together shall constitute one and the same document.
12. The capitalized terms used herein shall have the same meanings as the
capitalized terms used in the Credit Agreement.
IN WITNESS WHEREOF, the Borrower and the Bank have hereunto set their hands
as of the 23rd day of September, 2002.
X. X. XXXXX CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxx
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Xxxxxxx X. Xxxxxxxx
Vice President
THE HUNTINGTON NATIONAL BANK
By: /s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx
Assistant Vice President
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