Limited Waiver of Financial Covenant under Amended and Restated Credit Agreement among Hines Nurseries, Inc., Sun Gro Horticulture Canada Ltd., and Lenders

Summary

This agreement is a limited waiver between Hines Nurseries, Inc., Sun Gro Horticulture Canada Ltd., and their lenders, including Bankers Trust Company and others. The lenders agree to temporarily waive the requirement for the borrowers to maintain a minimum consolidated net worth above $88 million for the fiscal quarter ending December 31, 2001, due to anticipated financial adjustments. The waiver applies only to this specific covenant and quarter, and all other terms of the credit agreement remain in effect. The waiver becomes effective upon execution by the required parties.

EX-10.29 4 hines_10k-exwaiver.txt Exhibit 10.29 LIMITED WAIVER REGARDING FINANCIAL COVENANTS March 22, 2002 Hines Nurseries, Inc. 12621 Jeffrey Road Irvine, CA 92620 Attention: Claudia M. Pieropan Chief Financial Officer Ladies and Gentlemen: Reference is made to that certain Amended and Restated Credit Agreement dated as of June 26, 1998 among Hines Nurseries, Inc. and Sun Gro Horticulture Canada Ltd., as Borrowers, the lenders listed therein, as lenders (the "Lenders"), Bank of America, N.A., as syndication agent, Harris Trust and Savings Bank, as documentation agent, Deutsche Bank Canada, as Canadian agent, and Bankers Trust Company, as administrative agent (the "Administrative Agent") (said Credit Agreement, as amended, restated and modified to date, being the "Credit Agreement", the terms defined therein being used herein as therein defined). Borrowers have informed Administrative Agent and Lenders that as a result of certain reserves taken for the fiscal quarter ending December 31, 2001 in anticipation of the consummation of the Sun Gro Sale in the first fiscal quarter of 2002, Borrowers do not expect to be in compliance with the Minimum Consolidated Net Worth covenant set forth in subsection 7.6C of the Credit Agreement for the fiscal quarter ending December 31, 2001. Accordingly, at the request of Borrowers, the undersigned Lenders, constituting Requisite Lenders under the Credit Agreement, and Administrative Agent, hereby waive compliance with the Minimum Consolidated Net Worth covenant set forth in subsection 7.6C of the Credit Agreement for the fiscal quarter ending December 31, 2001 to the extent that such covenant would require Borrowers to have a Minimum Consolidated Net Worth for such fiscal quarter in excess of $88,000,0000. Without limiting the generality of the provisions of subsection 10.6 of the Credit Agreement, the waivers set forth herein shall be limited precisely as written and relate solely to Borrowers' noncompliance with the provisions of subsection 7.6C for the fiscal quarter ending December 31, 2001 and the waivers provided for herein do not constitute, nor should they be construed as, a waiver of compliance by Borrowers with respect to (i) subsection 7.6C of the Credit Agreement in any other instance or (ii) any other term, provision or condition of the Credit Agreement or any other instrument or agreement referred to therein. The waivers set forth herein shall not prejudice any right or remedy that Administrative Agent or any Lender may now have (except to the extent such right or remedy was based upon existing defaults that will S-1 not exist after giving effect to this waiver) or may have in the future under or in connection with the Credit Agreement or any other instrument or agreement referred to therein. Except as expressly set forth herein, the terms, provisions and conditions of the Credit Agreement and the other Loan Documents shall remain in full force and effect and in all other respects are hereby ratified and confirmed. This waiver 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 an original, but all such counterparts together shall constitute but one and the same instrument. The waiver set forth herein shall become effective as of the date hereof upon the execution of counterparts hereof by Loan Parties, Administrative Agent and by Lenders constituting Requisite Lenders and receipt by Borrowers and Administrative Agent of written or telephonic notification of such execution and authorization of delivery thereof. THIS WAIVER AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. LENDERS: BANKERS TRUST COMPANY, as a Lender and as Administrative Agent By: ------------------------------- Title: ------------------------------- DEUTSCHE BANK AG, NEW YORK BRANCH, as Issuing Lender By: ------------------------------- Title: ------------------------------- DEUTSCHE BANK CANADA, as Canadian Agent By: ------------------------------- Title: ------------------------------- S-2 BORROWERS: HINES NURSERIES, INC. By: ------------------------------- Title: ------------------------------- SUN GRO HORTICULTURE CANADA LTD. By: ------------------------------- Title: ------------------------------- S-3 LENDERS: MONUMENT CAPITAL LIMITED, as Assignee By: ALLIANCE CAPITAL MANAGEMENT L.P., as Investment Manager By: ALLIANCE CAPITAL MANAGEMENT CORPORATION, as General Partner By: ------------------------- Title: ---------------------- OAK MOUNTAIN LIMITED, as Assignee By: ALLIANCE CAPITAL MANAGEMENT L.P., as Investment Manager By: ALLIANCE CAPITAL MANAGEMENT CORPORATION, as General Partner By: -------------------------- Title: -------------------------- S-4 AIMCO CDO SERIES 2000-A, as a Lender By: ALLSTATE LIFE INSURANCE COMPANY By: ---------------------- Title: ---------------------- ALLSTATE LIFE INSURANCE COMPANY By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- S-5 BANK OF AMERICA, NATIONAL TRUST & SAVINGS ASSOCIATION, as a Lender and as Syndication Agent By: ------------------------------- Title: ------------------------------- S-6 BANK OF MONTREAL, as a Lender By: ------------------------------- Title: ------------------------------- S-7 BANK OF NOVA SCOTIA, as a Lender By: ------------------------------- Title: ------------------------------- S-8 BAY VIEW FINANCIAL CORPORATION, as a Lender By: ------------------------------- Title: ------------------------------- S-9 BLACK DIAMOND CLO 2000-1 LTD., as a Lender By: BLACK DIAMOND CAPITAL MANAGEMENT By: -------------------------- Title: -------------------------- BLACK DIAMOND NTERNATIONAL FUNDING, LTD., as a Lender By: ------------------------------------ Title: --------------------------------- S-10 BOEING CAPITAL CORPORATION, as a Lender By: ------------------------------- Title: ------------------------------- S-11 KZH CYPRESSTREE-1 LLC, as a Lender By: CHASE MANHATTAN BANK By: ---------------------- Title: ---------------------- KZH SHOSHONE LLC, as a Lender By: CHASE MANHATTAN BANK By: ---------------------- Title: ---------------------- S-12 CREDIT AGRICOLE INDOSUEZ, as a Lender By: ------------------------------- Title: ------------------------------- By: ------------------------------- Title: ------------------------------- S-13 CYPRESSTREE INVESTMENT FUND, LLC, as a Lender By: CYPRESSTREE INVESTMENT MANAGEMENT CO., INC. By: ------------------------- Title: ------------------------- CYPRESSTREE INVESTMENT PARTNERS ILLC, as a Lender By: CYPRESSTREE INVESTMENT MANAGEMENT CO., INC. By: ------------------------- Title: ------------------------- CYPRESSTREE - NORTH AMERICAN SENIOR FLOATING RATE FUND, as a Lender By: CYPRESSTREE INVESTMENT MANAGEMENT CO., INC. By: ------------------------- Title: ------------------------- CYPRESSTREE SENIOR FLOATING RATE FUND, as a Lender By: CYPRESSTREE INVESTMENT MANAGEMENT CO., INC. By: ------------------------- Title: ------------------------- S-14 DRESDNER BANK AG, NEW YORK AND GRAND CAYMAN BRANCHES, as a Lender By: ------------------------------- Title: ------------------------------- By: ------------------------------- Title: ------------------------------- S-15 FLEET NATIONAL BANK, as a Lender By: ------------------------------- Title: ------------------------------- S-16 FRANKLIN FLOAT RATE TRUST, as a Lender By: ------------------------------- Title: ------------------------------- S-17 FREMONT INVESTMENT & LOAN, as a Lender By: ------------------------------- Title: ------------------------------- S-18 HARCH CLO I LIMITED, as a Lender By: HARCH CAPITAL MANAGEMENT, INC. By: ---------------------- Title: ---------------------- S-19 HARRIS TRUST AND SAVINGS BANK, as a Lender and Documentation Agent By: ------------------------------- Title: ------------------------------- S-20 PACIFICA PARTNERS I, L.P., as a Lender By: IMPERIAL CREDIT ASSET MANAGEMENT, as Investment Manager By: ------------------------- Title: ------------------------- S-21 LASALLE BANK NATIONAL ASSOCIATION, as a Lender By: ------------------------------- Title: ------------------------------- S-22 MASSACHUSETTS MUTUAL - MAPLEWOOD (CAYMAN) LIMITED, as a Lender By: MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY By: -------------------------- Title: -------------------------- MASSACHUSETTS MUTUAL - SIMSBURY CLO, LIMITED, as a Lender By: MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY By: -------------------------- Title: -------------------------- MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY By: ------------------------------- Title: ------------------------------- S-23 PNC BUSINESS CREDIT By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- S-24 NATIONAL CITY BANK, as a Lender By: ------------------------------- Title: ------------------------------- S-25 OPPENHEIMER HARBOURVIEW CDO II LTD., as a Lender By: ------------------------------- Title: ------------------------------- S-26 PPM SPYGLASS FUNDING TRUST, as a Lender By: ------------------------------- Title: ------------------------------- S-27 COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK-RABOBANK B.A., "RABOBANK NEDERLAND", NEW YORK BRANCH, as a Lender By: ------------------------------- Title: ------------------------------- By: ------------------------------- Title: ------------------------------- S-28 STEIN ROE & FARNHAM CLO I LTD., as a Lender By: STEIN ROE & FARNHAM INCORPORATED, as Portfolio Manager By: -------------------------- Title: -------------------------- STEIN ROE FLOATING RATE LIMITED LIABILITY COMPANY, as a Lender By: STEIN ROE & FARNHAM INCORPORATED, as Advisor By: -------------------------- Title: -------------------------- LIBERTY-STEIN ROE ADVISOR FLOATING RATE ADVANTAGE FUND, as a Lender By: STEIN ROE & FARNHAM INCORPORATED, as Portfolio Manager By: -------------------------- Title: -------------------------- S-29 SRF TRADING, INC., as a Lender By: ------------------------------- Title: ------------------------------- SRF 2000 LLC, as a Lender By: ------------------------------- Title: ------------------------------- S-30 TORONTO - DOMINION (NEW YORK), INC., as a Lender By: ------------------------------- Title: ------------------------------- S-31 UNION BANK OF CALIFORNIA as a Lender By: ------------------------------- Title: ------------------------------- S-32 WELLS FARGO BANK, NA, as a Lender By: ------------------------------- Title: ------------------------------- S-33 By its execution of a counterpart of this consent and waiver, each of the undersigned, as additional Loan Parties with respect to the Credit Agreement hereby acknowledges that it has read this consent and waiver, and consents to the terms thereof and further hereby confirms and agrees that, notwithstanding the effectiveness of this consent and waiver, the obligations of the undersigned under the Loan Documents to which such Loan Party is a party shall not be impaired or affected and each such Loan Document is, and shall continue to be, in full force and effect and is hereby confirmed and ratified in all respects. HINES HORTICULTURE, INC. By: ------------------------- Title: ------------------------- SUN GRO HORTICULTURE INC. By: ------------------------- Title: ------------------------- ENVIRO-SAFE LABORATORIES, INC. By: ------------------------- Title: ------------------------- MADISON DEARBORN PARTNERS, L.P. By: Madison Dearborn Partners, L.P., its General Partner By: Madison Dearborn Partners, Inc. By: --------------------------- Title: ------------------------ 1