First Amendment to Revolving Credit and Term Loan Agreement among GenRad, Inc., Affiliates, and Fleet National Bank

Contract Categories: Business Finance › Modification Agreements
Summary

This amendment, dated June 29, 2000, modifies the existing Revolving Credit and Term Loan Agreement between GenRad, Inc. and its affiliates as borrowers, and Fleet National Bank and other lenders. The changes include adjustments to interest rate margins, borrowing base calculations, and financial definitions. It also revises limits on stock repurchases and acquisitions, and updates certain financial covenants. The amendment is effective immediately and requires the company to meet specific financial conditions before making certain distributions or acquisitions.

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EX-10.18 3 a2048997zex-10_18.txt EXHIBIT 10-18 - -------------------------------------------------------------------------------- FIRST AMENDMENT TO REVOLVING CREDIT AND TERM LOAN AGREEMENT - -------------------------------------------------------------------------------- First Amendment dated as of June 29, 2000 to Revolving Credit and Term Loan Agreement (the "First Amendment"), by and among GENRAD, INC., a Massachusetts corporation (the "Company"), GENRAD EUROPE LIMITED, a private company limited by shares organized under the laws of England and Wales, with registered number 02873907 ("GenRad Europe"), GENRAD LIMITED, a private company limited by shares organized under the laws of England and Wales, with registered number 00790061 ("GenRad Limited"), GENRAD HOLDINGS LIMITED, a private company limited by shares organized under the laws of England and Wales, with registered number 01761564 ("Holdings"), GIGANTISSIMO 2209 AKTIEBOLAG, a corporation organized under the laws of Sweden ("GenRad Sweden" and, collectively with the Company, GenRad Europe, GenRad Limited and Holdings, the "Borrowers" and each individually, a "Borrower"), FLEET NATIONAL BANK (formerly known as BANKBOSTON, N.A.) and the other lending institutions listed on Schedule 1 to the Credit Agreement (as hereinafter defined) (the "Banks") and FLEET NATIONAL BANK (London Branch) as Overdraft Bank (as defined in the Credit Agreement referred to below), amending certain provisions of the Revolving Credit and Term Loan Agreement dated as of March 24, 2000 (as amended and in effect from time to time, the "Credit Agreement") by and among the Borrowers, the Banks, the Overdraft Bank and FLEET NATIONAL BANK in its capacity as agent for the Banks (the "Agent"). Terms not otherwise defined herein which are defined in the Credit Agreement shall have the same respective meanings herein as therein. WHEREAS, the Borrowers and the Banks have agreed to modify certain terms and conditions of the Credit Agreement as specifically set forth in this First Amendment; NOW, THEREFORE, in consideration of the premises and the mutual agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: ss.1. Amendment toss.1.1 of the Credit Agreement. Section 1.1 of the Credit Agreement is hereby amended as follows: (a) the definition of "Applicable Margin" is hereby amended by deleting the table contained in such definition in its entirety and restating it as follows: -2-
- ---------------------------------------------------------------------------------------------------- Sterling Base Rate Base Rate Eurocurrency Letter of Level Leverage Ratio Loans Loans Rate Loans Credit Fees Commitment Fees - ---------------------------------------------------------------------------------------------------- I Greater than or equal 1.25% 2.25% 2.25% 2.25% .750% to 1.75:1.00 - ---------------------------------------------------------------------------------------------------- II Less than 1.75:1.00 but greater than or equal to 1.25:1.00 1.00% 2.00% 2.00% 2.00% .750% - ---------------------------------------------------------------------------------------------------- III Less than 1.25:1.00 but greater than or equal to 0.75:1.00 0.75% 1.75% 1.75% 1.75% .750% - ---------------------------------------------------------------------------------------------------- IV Less than 0.75:1.00 0.50% 1.50% 1.50% 1.50% .625% - ----------------------------------------------------------------------------------------------------
(b) the definition of "Borrowing Base" is hereby amended by deleting paragraph (b) of such definition in its entirety and restating it as follows: (b) the lesser of (i) 40% of the Net Book Value of Eligible Inventory and (ii) $15,000,000. (c) the definition of EBITDA is hereby amended by deleting such definition in its entirety and restating it as follows: EBITDA. With respect to any fiscal period, an amount equal to the sum of (a) Consolidated Net Income of the Company and its Subsidiaries for such fiscal period, plus (b) in each case to the extent deducted in the calculation of such Person's Consolidated Net Income and without duplication, (i) depreciation and amortization for such period, plus (ii) income tax expense for such period, plus (iii) Consolidated Total Interest Expense paid or accrued during such period, plus (iv) other noncash charges for such period, plus (v) solely for purposes of computing compliance with the financial covenants contained in ss.12.1, 12.3 and 12.4 (and not for, among other things, purposes of computing the Leverage Ratio for determining the Applicable Margin or ascertaining the ability of the Company to consummate a Permitted Acquisition as set forth in ss.11.5.1.(f)) the one-time cash charge taken during such period in connection with severance packages provided to certain members of management, provided the aggregate amount of all such cash charges does not exceed $2,000,000, and minus, to the extent added in computing Consolidated Net Income, and without duplication, all noncash gains (including income tax benefits) for such period, all as determined in accordance with generally accepted accounting principles. ss.2. Amendment toss.11 of the Credit Agreement. Section 11 of the Credit Agreement is hereby amended as follows: -3- (a) Section 11.4(c) of the Credit Agreement is hereby amended by deleting the words "the Company shall be permitted to make Distributions in respect of stock repurchases in an aggregate amount not to exceed $15,000,000 in any fiscal year" which appear in such ss.11.4(c) and substituting in place thereof the words "the Company shall be permitted to make Distributions in respect of stock repurchaes in an aggregate amount not to exceed $7,500,000 in any fiscal year, provided, the Company shall not be permitted to make any such Distributions until (i) after the last day of the fourth fiscal quarter of the 2000 fiscal year and (ii) after the Company has demonstrated to the Agent and the Banks compliance with all the financial covenants contained in ss.12 hereof for the fourth fiscal quarter of the 2000 fiscal year" (b) Section 11.5.1(f) of the Credit Agreement is hereby amended by (i) inserting immediately after the words "so long as the Company's Leverage Ratio on a pro forma basis immediately prior to and after giving effect to any acquisition is at a level which is at least 0.25 times less than the required financial covenant level in effect at the date of determination" the words "and so long as such acquisition does not occur prior to the first day of the first fiscal quarter of the Company's 2001 fiscal year"; and (ii) deleting the words "shall not exceed (a) $10,000,000 in the aggregate for any acquisition or series of related acquisitions and (b) $20,000,000 in the aggregate for all acquisitions consummated in any period of twelve (12) consecutive months" and substituting in place thereof the words "shall not exceed (a) $5,000,000 in the aggregate for any acquisition or series of related acquisitions and (b) $10,000,000 in the aggregate for all acquisitions consummated in any period of twelve (12) consecutive months" ss.3. Amendment toss.12 of the Credit Agreement. Section 12 of the Credit Agreement is hereby amended as follows: (a) Section 12.2 of the Credit Agreement is hereby amended by deleting the table contained in ss.12.2 in its entirety and restating it as follows:
--------------------------------------------------------- Period Ratio --------------------------------------------------------- Closing Date - December 30, 2000 0.75:1.00 --------------------------------------------------------- Any time thereafter 1.00:1.00 ---------------------------------------------------------
(b) Section 12.3 of the Credit Agreement is hereby amended by (i) inserting immediately after the words "will not permit the ratio of Consolidated Operating Cash Flow to Consolidated Total Debt Service for any fiscal quarter ending during any period described in the table set forth below" the words "other than the fiscal quarter ending July 1, 2000"; and (ii) deleting the table contained in ss.12.3 in its entirety and restating it as follows:
Fiscal Quarter Ending Ratio --------------------- ----- April 1, 2000 1.75:1.00 July 1, 2000 Not Tested September 30, 2000 - December 30, 2000 1.75:1.00 Each fiscal quarter ending thereafter 2.00:1.00
-4- (c) Section 12.4 of the Credit Agreement is hereby amended by deleting the table contained in ss.12.4 in its entirety and restating it as follows:
Fiscal Quarter Ending Amount --------------------- ------ April 1, 2000 $17,000,000 July 1, 2000 $6,500,000 September 30, 2000 $10,500,000 December 30, 2000 $18,700,000 [March 31, 2001] $11,900,000 [June 30, 2001] $14,700,000 Each fiscal quarter ending thereafter $20,000,000
ss.4. Conditions to Effectiveness. This First Amendment shall not become effective until the Agent receives the following: (a) a counterpart of this First Amendment, executed by the Borrowers, each Guarantor and the Majority Banks; (b) evidence satisfactory to the Agent that all corporate or other similar action has been taken by the Borrowers and the Guarantors to authorize the transactions contemplated hereby; and (c) payment by the Borrowers of an amendment fee in the amount of $156,250, which amendment fee shall be for the pro rata accounts of the Banks. ss.5. Representations and Warranties. Each of the Borrowers hereby repeats, on and as of the date hereof, each of the representations and warranties made by it in ss.9 of the Credit Agreement, provided, that all references therein to the Credit Agreement shall refer to such Credit Agreement as amended hereby. In addition, each of the Borrowers hereby represents and warrants that the execution and delivery by each Borrower of this First Amendment and the performance by each Borrower of all of their agreements and obligations under the Credit Agreement as amended hereby are within the corporate authority of each Borrower and have been duly authorized by all necessary corporate or other similar action on the part of each Borrower. ss.6. Ratification, Etc. Except as expressly amended hereby, the Credit Agreement and all documents, instruments and agreements related thereto, including, but not limited to the Security Documents, are hereby ratified and confirmed in all respects and shall continue in full force and effect. The Credit Agreement and this First Amendment shall be read and construed as a single agreement. All references in the Credit Agreement or any related agreement or instrument to the Credit Agreement shall hereafter refer to the Credit Agreement as amended hereby. -5- ss.7. No Waiver. Nothing contained herein shall constitute a waiver of, impair or otherwise affect any Obligations, any other obligation of the Borrowers or any rights of the Agent, the Overdraft Bank or the Banks consequent thereon. ss.8. Counterparts. This First Amendment may be executed in one or more counterparts, each of which shall be deemed an original but which together shall constitute one and the same instrument. ss.9. Governing Law. THIS FIRST AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS (WITHOUT REFERENCE TO CONFLICT OF LAWS). -6- IN WITNESS WHEREOF, the parties hereto have executed this First Amendment as a document under seal as of the date first above written. GENRAD, INC. By: /s/ Walter A. Shephard ------------------------------------- Name: WALTER SHEPHARD Title: CFO GENRAD HOLDINGS LIMITED By: /s/ Walter A. Shephard ------------------------------------- Name: WALTER SHEPHARD Title: Director GENRAD EUROPE LIMITED By: /s/ Walter A. Shephard ------------------------------------- Name: WALTER SHEPHARD Title: Director GENRAD LIMITED By: /s/ Walter A. Shephard ------------------------------------- Name: WALTER SHEPHARD Title: Director GIGANTISSIMO 2209 AKTIEBOLAG By: /s/ Walter A. Shephard ------------------------------------- Name: WALTER SHEPHARD -7- FLEET NATIONAL BANK (London Branch), as Overdraft Bank By: /s/ Debra E. DelVecchio ------------------------------------- Debra E. DelVecchio, Vice President FLEET NATIONAL BANK (London Branch), as Overdraft Bank By: /s/ Debra E. DelVecchio ------------------------------------- Title: Vice President KEYBANK NATIONAL ASSOCIATION By: ------------------------------------- Title: THE CHASE MANHATTAN BANK By: ------------------------------------- Title: NATIONAL CITY BANK OF KENTUCKY By: ------------------------------------- Title: THE BANK OF NOVA SCOTIA By: ------------------------------------- Title: SUMMIT BANK By: ------------------------------------- Title: -7- FLEET NATIONAL BANK By: ------------------------------------- Debra E. DelVecchio, Vice President FLEET NATIONAL BANK (London Branch), as Overdraft Bank By: ------------------------------------- Title: KEYBANK NATIONAL ASSOCIATION By: /s/ Lisa [ILLEGIBLE] ------------------------------------- Title: Vice President THE CHASE MANHATTAN BANK By: ------------------------------------- Title: NATIONAL CITY BANK OF KENTUCKY By: ------------------------------------- Title: THE BANK OF NOVA SCOTIA By: ------------------------------------- Title: SUMMIT BANK By: ------------------------------------- Title: -6- FLEET NATIONAL BANK By: ------------------------------------- Title: KEYBANK NATIONAL ASSOCIATION By: ------------------------------------- Title: THE CHASE MANHATTAN BANK By: /s/ Roger A. Stone ------------------------------------- Roger A. Stone, Senior Vice President NATIONAL CITY BANK OF KENTUCKY By: ------------------------------------- Title: THE BANK OF NOVA SCOTIA By: ------------------------------------- Title: SUMMIT BANK By: ------------------------------------- Title: CITIZENS BANK OF MASSACHUSETTS By: ------------------------------------- Title: -7- FLEET NATIONAL BANK By: ------------------------------------- Debra E. DelVecchio, Vice President FLEET NATIONAL BANK (London Branch), as Overdraft Bank By: ------------------------------------- Title: KEYBANK NATIONAL ASSOCIATION By: ------------------------------------- Title: THE CHASE MANHATTAN BANK By: ------------------------------------- Title: NATIONAL CITY BANK OF KENTUCKY By: /s/ Glenn E. Nord ------------------------------------- Title: GLENN E. NORD VICE PRESIDENT THE BANK OF NOVA SCOTIA By: ------------------------------------- Title: SUMMIT BANK By: ------------------------------------- Title: -7- FLEET NATIONAL BANK By: ------------------------------------- Debra E. DelVecchio, Vice President FLEET NATIONAL BANK (London Branch), as Overdraft Bank By: ------------------------------------- Title: KEYBANK NATIONAL ASSOCIATION By: ------------------------------------- Title: THE CHASE MANHATTAN BANK By: ------------------------------------- Title: NATIONAL CITY BANK OF KENTUCKY By: ------------------------------------- Title: THE BANK OF NOVA SCOTIA By: /s/ T.M. Pitcher ------------------------------------- Title: T.M. Pitcher Authorized Signatory SUMMIT BANK By: ------------------------------------- Title: -7- FLEET NATIONAL BANK By: ------------------------------------- Debra E. DelVecchio, Vice President FLEET NATIONAL BANK (London Branch), as Overdraft Bank By: ------------------------------------- Title: KEYBANK NATIONAL ASSOCIATION By: ------------------------------------- Title: THE CHASE MANHATTAN BANK By: ------------------------------------- Title: NATIONAL CITY BANK OF KENTUCKY By: ------------------------------------- Title: THE BANK OF NOVA SCOTIA By: ------------------------------------- Title: SUMMIT BANK By: /s/ Steven De Luise ------------------------------------- Title: Vice President Steven De Luise -8- CITIZENS BANK OF MASSACHUSETTS By: ------------------------------------- Title: FIRST MASSACHUSETTS BANK, N.A. By: /s/ [ILLEGIBLE] ------------------------------------- Title: SVP BANK ONE, NA (Main Office Chicago) By: ------------------------------------- Title: LLOYDS TSB BANK PLC By: ------------------------------------- Title: ABN AMRO BANK N.V. By: ------------------------------------- Title: By: ----------------------------------- Title: -8- CITIZENS BANK OF MASSACHUSETTS By: ------------------------------------- Title: FAMILY BANK, FSB By: ------------------------------------- Title: BANK ONE, NA (Main Office Chicago) By: /s/ Andrea S. Kantor ------------------------------------- Title: ANDREA S. KANTOR Vice President LLOYDS TSB BANK PLC By: ------------------------------------- Title: ABN AMRO BANK N.V. By: ------------------------------------- Title: By: ----------------------------------- Title: -8- CITIZENS BANK OF MASSACHUSETTS By: ------------------------------------- Title: FAMILY BANK, FSB By: ------------------------------------- Title: BANK ONE, NA (Main Office Chicago) By: ------------------------------------- Title: LLOYDS TSB BANK PLC By: /s/ Ian Dimmock ------------------------------------- Title: IAN DIMMOCK Vice President Acquisition Finance D080 /s/ Gavin Rees ------------------------------------- Gavin Rees Assistant Vice President Structured Finance R185 ABN AMRO BANK N.V. By: ------------------------------------- Title: By: ----------------------------------- Title: -8- CITIZENS BANK OF MASSACHUSETTS By: ------------------------------------- Title: FAMILY BANK, FSB By: ------------------------------------- Title: BANK ONE, NA (Main Office Chicago) By: ------------------------------------- Title: LLOYDS TSB BANK PLC By: ------------------------------------- Title: ABN AMRO BANK N.V. By: /s/ N. Smith ------------------------------------- Title: AVP. By: [ILLEGIBLE] ----------------------------------- Title: VP -9- RATIFICATION OF GUARANTY Each of the undersigned guarantors hereby acknowledges and consents to the foregoing First Amendment as of June 26, 2000, and agrees that the applicable Guarantee from such Guarantor dated as of March 24, 2000 in favor of the Agent for the benefit of the Agent and the Banks and all other Loan Documents to which each of the Guarantors are a party remain in full force and effect, and each of the Guarantors confirms and ratifies all of its obligations thereunder. GENRAD MEXICO, INC. By: /s/ Walter A. Shephard ------------------------------------- Title: GENRAD HOLDINGS LIMITED By: /s/ Walter A. Shephard ------------------------------------- Title: GENRAD LIMITED By: /s/ Walter A. Shephard ------------------------------------- Title: GENRAD EUROPE LIMITED By: /s/ Walter A. Shephard ------------------------------------- Title: TAVSTOCK LIMITED By: /s/ Walter A. Shephard ------------------------------------- Title: