Waiver, Consent and Amendment to Senior Subordinated Credit Agreement among Vertis, Inc., Vertis Holdings, Inc., Subsidiary Guarantors, Lenders, and Agents

Summary

This agreement, dated May 30, 2002, is an amendment to the Senior Subordinated Credit Agreement among Vertis, Inc., Vertis Holdings, Inc., their subsidiary guarantors, various lenders, and agents. It allows Vertis, Inc. to issue up to $300 million in senior notes and sets conditions for how the proceeds must be used. The amendment also updates certain definitions and terms in the original credit agreement. All parties agree that these changes do not trigger a default, and the subsidiary guarantors confirm their ongoing obligations. The agreement is governed by New York law.

EX-10.14 17 a2106381zex-10_14.txt EXHIBIT 10.14 EXHIBIT 10.14 WAIVER, CONSENT AND AMENDMENT Waiver, Consent and Amendment, dated as of May 30, 2002 (the "Amendment"), to the Senior Subordinated Credit Agreement, dated as of December 7, 1999, as amended, among Vertis, Inc. (f/k/a Big Flower Press Holdings, Inc.), a Delaware corporation (the "Company"), Vertis Holdings, Inc. (f/k/a Big Flower Holdings, Inc.), a Delaware corporation ("Holdings"), the Subsidiary Guarantors named on the signature pages hereto, the Lenders named on the signature pages hereto (the "Lenders") and Deutsche Bank Trust Company Americas (f/k/a Bankers Trust Company), JP Morgan Chase Bank (f/k/a The Chase Manhattan Bank) and Banc of America Bridge LLC (f/k/a NationsBridge, L.L.C.) as Agents for the Lenders (in such capacity, the "Agents") (the "Credit Agreement"). Except as otherwise indicated herein, capitalized terms used herein have the same meanings as set forth in the Credit Agreement. W I T N E S S E T H : WHEREAS, the Company is contemplating issuing up to $300.0 million of unsecured senior notes on or prior to July 31, 2002, which notes will be sold pursuant to Rule 144A or Regulation S under the Securities Act of 1933, as amended, substantially on the terms set forth in that certain draft offering memorandum dated May 30, 2002 which terms have been approved by the Agents (such issuance, the "Senior Notes Issuance"); WHEREAS, pursuant to Section 12.6 of the Credit Agreement, the Company desires to have the Required Lenders waive certain provisions of the Credit Agreement and consent to the departure of the Company therefrom and amend certain provisions of the Credit Agreement; NOW THEREFORE, in consideration of the premises and covenants contained herein, and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows: 1. WAIVER AND CONSENT. The Required Lenders hereby waive compliance by the Company with and consent to the departure from the provisions of the Credit Agreement (including, without limitation, Exhibit XIV to the Credit Agreement) with respect to the Senior Note Issuance; provided that the proceeds of such Senior Notes Issuance are applied as follows: First, to the repayment of $25 million of revolving credit borrowings under the Senior Credit Facility; Second, to the payment of all fees and expenses relating to the Senior Notes Offering; and Third, 50% of the remaining proceeds to the repayment of term loan borrowings under the Senior Credit Facility and 50% of the remaining proceeds to the repayment -2- of amounts outstanding under the Credit Agreement. The Required Lenders hereby agree that the Senior Note Issuance or the application of the proceeds thereof as described above shall not constitute an Event of Default or Potential Event of Default under the Credit Agreement. 2. AMENDMENT. (a) SECTION 1.1. Section 1.1 of the Credit Agreement is hereby amended as follows: (1) By adding the following definition in alphabetical order therein: "Senior Note Offering" means the Company's issuance of senior notes in an aggregate principal amount not to exceed $300.0 million." (2) The definition of "Trigger Date" is hereby amended as follows: "Trigger Date" means July 31, 2002; provided, however, that if the Company has consummated the Senior Note Offering on or prior to July 31, 2002, then the Trigger Date will be extended to January 31, 2003." (3) The definition of "A/R Facility" is hereby amended to read as follows: "A/R Facility" means the Receivable Purchase Agreement dated as of March 19, 1996, as amended among Holdings, certain subsidiaries of Holdings (including the Company) and BFP Receivables Corporation in each case as such agreement may be amended (including any amendment and restatement thereof), supplemented or otherwise modified from time to time, including any agreement extending the term thereof of, or any successor or replacement agreement, including, without limitation, any agreement or agreements governing a Qualified Receivables Transaction (as defined in Exhibit XIV to the Credit Agreeement)." (b) EXHIBIT XIV. Exhibit XIV to the Credit Agreement is hereby amended as follows: (1) The section entitled "Certain Definitions" is hereby amended by adding the following definition in alphabetical order therein: -3- "Senior Notes" means the Company's senior notes issued between May 1, 2002 and July 31, 2002 in an aggregate principal amount not to exceed $300.0 million. (2) The definition of "Permitted Indebtedness" is hereby amended by (1) deleting the word "and" at the end of clause (14) thereof and replacing it with a semicolon, and (2) deleting the period at the end of clause (15) thereof and replacing it with a semicolon and the word "and" and (3) adding a new clause (16) thereto which reads as follows, "Indebtedness of the Company represented by the Senior Notes and guarantees of the Senior Notes by certain of the Company's Restricted Subsidiaries." (3) The definition of "A/R Facility" is hereby amended in its entirety to read as follows: "A/R Facility" means the Receivable Purchase Agreement dated as of March 19, 1996, as amended among Holdings, certain subsidiaries of Holdings (including the Company) and BFP Receivables Corporation in each case as such agreement may be amended (including any amendment and restatement thereof), supplemented or otherwise modified from time to time, including any agreement extending the term thereof of, or any successor or replacement agreement, including, without limitation, any agreement or agreements governing a Qualified Receivables Transaction." 3. ADDITIONAL FEES. The Company agrees to pay on demand all costs and expenses of the Agents and Lenders in connection with the preparation, execution and delivery of this Amendment and the documentation contemplated hereby, including the reasonable fees and out-of-pocket expenses of Cahill Gordon & Reindel, counsel for the Agents and Lenders, with respect thereto. 4. SCOPE OF AMENDMENT. Except as specifically amended hereby, the Credit Agreement, shall remain unchanged. It is declared and agreed by each of the parties hereto that the Credit Agreement, including but not limited to Section 5.12 thereof, subject to this Amendment, shall continue, in full force and effect, and that the Amendment and the Credit Agreement shall be read as and shall constitute one document. 5. COUNTERPARTS. This Amendment may be executed in multiple counterparts, and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. -4- 6. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW. 7. ACKNOWLEDGMENT AND CONSENT BY THE SUBSIDIARY GUARANTORS. Each Subsidiary Guarantor hereby acknowledges that it has read this Amendment and consents to the terms hereof and further confirms and agrees that, notwithstanding the effectiveness of this Amendment, its obligations under its Guarantee shall not be impaired or affected and its Guarantee is, and shall continue to be, in full force and effect and is hereby confirmed and ratified in all respects. S-1 WITNESS the due execution hereof by the respective duly authorized officers of the undersigned as of the date first written above. VERTIS, INC. By: /s/ John V. Howard, Jr. -------------------------------- Name: John V. Howard, Jr. Title: Senior Vice President VERTIS HOLDINGS, INC. By: /s/ John V. Howard, Jr. -------------------------------- Name: John V. Howard, Jr. Title: Senior Vice President SUBSIDIARY GUARANTORS: PRINTCO., INC. By: /s/ John V. Howard, Jr. -------------------------------- Name: John V. Howard, Jr. Title: Senior Vice President WEBCRAFT LLC By: /s/ John V. Howard, Jr. -------------------------------- Name: John V. Howard, Jr. Title: Senior Vice President WEBCRAFT CHEMICALS LLC By: /s/ John V. Howard, Jr. -------------------------------- Name: John V. Howard, Jr. Title: Senior Vice President S-2 ENTERON GROUP LLC. By: /s/ John V. Howard, Jr. -------------------------------- Name: John V. Howard, Jr. Title: Senior Vice President BIG FLOWER DIGITAL SERVICES (DELAWARE), INC. By: /s/ John V. Howard, Jr. -------------------------------- Name: John V. Howard, Jr. Title: Senior Vice President BIG FLOWER DIGITAL LLC By: BIG FLOWER DIGITAL SERVICES (DELAWARE), INC. By: /s/ John V. Howard, Jr. -------------------------------- Name: John V. Howard, Jr. Title: Senior Vice President S-3 AGENTS: DEUTSCHE BANK TRUST COMPANY AMERICAS, as co-agent By: /s/ David J. Flannery -------------------------------- Name: David J. Flannery Title: Managing Director JP MORGAN CHASE BANK as co-agent By: /s/ Randolph E. Cates -------------------------------- Name: Randolph E. Cates Title: Vice President BANC OF AMERICA BRIDGE LLC, as co-agent By: /s/ S. Paul Trapani, III -------------------------------- Name: S. Paul Trapani, III Title: Senior Vice President S-4 LENDERS: DEUTSCHE BANK TRUST CORPORATION By: /s/ David J. Flannery -------------------------------- Name: David J. Flannery Title: Managing Director JP MORGAN CHASE BANK By: /s/ Randolph E. Cates -------------------------------- Name: Randolph E. Cates Title: Vice President BANC OF AMERICA BRIDGE LLC By: /s/ S. Paul Trapani, III -------------------------------- Name: S. Paul Trapani, III Title: Senior Vice President ARCHIMEDES FUNDING III, LTD. By: ING Capital Advisors LLC, as Collateral Manager By: /s/ Jane Musser Nelson -------------------------------- Name: Jane Musser Nelson Title: Managing Director S-5 OAK HILL SECURITIES FUND II, L.P. By: Oak Hill Securities GenPar II, L.P., its General Partner By: Oak Hill Securities MGP II, Inc., its General Partner By: /s/ Scott D. Krase -------------------------------- Name: Scott D. Krase Title: Authorized Signatory D.K. ACQUISITION PARTNERS, L.P. By: M.H. Davidson & Co., its General Partner By: /s/ Thomas Kempner -------------------------------- Name: Thomas Kempner Title: Partner FRANKLIN FLOATING RATE TRUST By: /s/ RiCHARD HsU -------------------------------- Name: Richard Hsu Title: Vice President S-6 TCW LEVERAGED INCOME TRUST, L.P. By: TCW Advisers (Bermuda), Ltd. as Investment Adviser By: /s/ Mark L. Gold -------------------------------- Name: Mark L. Gold Title: Managing Director By: TCW Investment Management Company, as Investment Adviser By: /s/ Jonathan R. Insull -------------------------------- Name: Jonathan R. Insull Title: Managing Director TCW LEVERAGED INCOME TRUST II, L.P. By: TCW Advisers (Bermuda), Ltd. as General Partner By: /s/ Mark L. Gold -------------------------------- Name: Mark L. Gold Title: Managing Director By: TCW Investment Management Company, as Investment Adviser By: /s/ Jonathan R. Insull -------------------------------- Name: Jonathan R. Insull Title: Managing Director S-7 FLEET CORPORATE FINANCE, INC. By: /s/ Timothy C. Shoyer -------------------------------- Name: Timothy C. Shoyer Title: Vice President MERRILL LYNCH GLOBAL INVESTMENT SERIES: INCOME STRATEGIES PORTFOLIO By: Merrill Lynch Asset Management, L.P., as Investment Advisor By: /s/ Jaimin Patel -------------------------------- Name: Jaimin Patel Title: Authorized Signatory