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Exhibit 10.41
EIGHTH AMENDMENT TO REVOLVING CREDIT AGREEMENT
This Eighth Amendment to Revolving Credit Agreement ("Eighth
Amendment") is made as of June 30, 2000 by and among PROVANT, Inc. (the
"Borrower"), a Delaware business corporation having its principal place of
business at 67 Batterymarch Street, Suite 500, Boston, Massachusetts 02110,
Fleet National Bank, a national banking association ("Fleet"), Wells Fargo Bank
Iowa, N.A., a national banking association ("Wells Fargo"), Citizens Bank of
Massachusetts, a Massachusetts banking corporation ("Citizens"), and KeyBank
National Association, a national banking association ("KeyBank" and, together
with Fleet, Wells Fargo and Citizens, the "Banks"), and Fleet National Bank, as
agent for itself and the other Banks (the "Agent").
RECITALS
WHEREAS, the Borrower, the Banks and the Agent previously entered into
that certain Revolving Credit Agreement, dated as of April 8, 1998, as modified
and amended by the First, Second, Third, Fourth, Fifth, Sixth and Seventh
Amendments thereto (said Revolving Credit Agreement, as so amended prior to the
date hereof, the "Credit Agreement"), pursuant to which the Banks have made
available to the Borrower a revolving credit loan facility having a maximum
available borrowing amount of $105,000,000; and
WHEREAS, the parties hereto now desire to further amend or modify the
Credit Agreement in certain respects in order to (i) waive and/or modify and
amend certain of the financial covenants set forth in the Credit Agreement, (ii)
modify the interest rate structure applicable to all loans thereunder, and (iii)
modify the procedures for approval by the Banks of future acquisitions by the
Borrower or its Subsidiaries.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
hereto hereby agree to modify and amend certain provisions of the Credit
Agreement, as follows:
Section 1. Definitions. All capitalized terms used herein without
definition shall have the respective meanings provided therefor in the Credit
Agreement.
Section 2. Waiver Regarding Specific Provisions. The Banks hereby grant
a waiver of the Consolidated EBITDA financial covenant set forth in Section 9.4
of the Credit Agreement with respect to the four consecutive fiscal quarters of
the Borrower ended on March 31, 2000. The foregoing waiver is limited to the
particular fiscal period set forth in the preceding sentence.
Section 3. Amendment of Specific Provisions. The following specific
provisions in the Credit Agreement are hereby modified and amended:
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(a) In the definition of "Applicable Margin" in Section 1.1,
the Table of Interest Rates and Fees is hereby deleted, and the following Table
is substituted therefor:
<TABLE>
<CAPTION>
INTEREST RATES FEES
--------------------------- ------------------------------
PRIME RATE EURODOLLAR COMMITMENT LETTER OF CREDIT
LEVERAGE RATIO LOANS RATE LOANS FEE RATE FEE RATE
-------------- -------------- ----------- -------- ----------------
<S> <C> <C> <C> <C>
< 1.00 X 0.00% 0.875% 0.25% 0.875%
> or = to 1.00 X < 1.50 X 0.00% 1.25% 0.30% 1.25%
> or = to 1.50 X < 2.00 X 0.25% 1.625% 0.35% 1.625%
> or = to 2.00 X < 2.50 X 0.50% 1.875% 0.40% 1.875%
> or = to 2.50 X 0.75% 2.25% 0.45% 2.25%
</TABLE>
Also, the reference "> or = to 3.00" appearing in the final sentence
of the definition of "Applicable Margin" is hereby amended to read "> or = to
2.50".
(b) For purposes of the applicability of the minimum
Consolidated EBITDA covenant set forth in Section 9.4 of the Credit Agreement
(and not for purposes of any other financial covenant), (i) the required minimum
amount of Consolidated EBITDA for the four consecutive fiscal quarters of the
Borrower to end on June 30, 2000 shall be $30,000,000 (but for each subsequent
four-quarter fiscal period the minimum Consolidated EBITDA amount shall be as
specified in said Section 9.4), and (ii) the calculation of minimum Consolidated
EBITDA pursuant to said Section 9.4 shall be deemed to include addbacks to
Consolidated Net Income for (x) a restructuring charge of $10.6 million taken by
the Borrower in its third fiscal quarter ended March 31, 2000 and described in
its quarterly financial statements, which restructuring charge relates to the
Borrower's reorganization program consisting of executive/employee severance,
lease termination costs, inventory and contract termination costs, the
abandonment of property and equipment, and other costs relating to eliminated
activities, and (y) a further restructuring charge of up to $1.1 million for the
Borrower's reorganization program taken in the Borrower's fourth fiscal quarter
ending June 30, 2000.
(c) In Section 9.6 of the Credit Agreement, the text thereof
shall be amended and restated in its entirety to read as follows (and shall
apply to the fiscal year of the Borrower ending on June 30, 2000 and to each
fiscal year thereafter):
"9.6 Capital Expenditures. The Borrower and its Subsidiaries
will not make in the aggregate Capital Expenditures in excess of Ten
Million Dollars ($10,000,000) in any single fiscal year of the
Borrower. In calculating the amount of Capital Expenditures incurred,
no unutilized amount of Capital Expenditures permitted to be incurred
in any given fiscal year may be used or credited by the Borrower or its
Subsidiaries in any subsequent fiscal year by the Borrower."
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(d) In Section 8.5.1 of the Credit Agreement, the text of such
subparagraph shall be amended and restated in its entirety to read as follows:
"8.5.1 Mergers and Acquisitions. The Borrower will not, and
will not permit its Subsidiaries to, become a party to any merger or
consolidation, or agree to or effect any asset acquisition or stock
acquisition (other than the acquisition of assets in the ordinary
course of business consistent with past practices), except for (i) the
mergers contemplated by the Transaction, (ii) the merger or
consolidation of any one or more wholly-owned Subsidiaries of the
Borrower with and into the Borrower, or the merger or consolidation of
two or more wholly-owned Subsidiaries of the Borrower (so long as the
successor Subsidiary is, or contemporaneously becomes, a Guarantor
under the Guaranty and the stock of such successor Subsidiary is, or
contemporaneously becomes, pledged and assigned under the Pledge
Agreement), and (iii) the acquisition of the assets or stock of another
party not already a Subsidiary (each, a "Permitted Acquisition"), but
only if and to the extent that such Permitted Acquisition is approved
in writing by the Majority Banks in their discretion (including, if so
approved, any conditions which such Majority Banks may determine
necessary or appropriate to impose)."
Section 4. Confirmation of Stock Pledge Agreement. The parties hereto
agree that all references to the "Credit Agreement" contained in the Stock
Pledge Agreement and all Supplements thereto shall mean or refer to the Credit
Agreement as amended and supplemented by this Eighth Amendment and as it may be
further amended, supplemented, modified and restated and in effect from time to
time, including without limitation any such amendment, supplement, modification
or restatement which increases the amount of Indebtedness owing by the Borrower
thereunder.
Section 5. Loan Documents Ratified and Confirmed. The Credit Agreement,
the Notes and each of the other Loan Documents, as specifically supplemented or
amended by this Eighth Amendment and the other documents executed in connection
herewith, are and shall continue to be in full force and effect and are hereby
in all respects ratified and confirmed. Without limiting the generality of the
foregoing, the Security Documents and all of the collateral described therein
do, and shall continue to, secure the payment of all obligations under the Loan
Documents, in each case as amended or supplemented pursuant to this Eighth
Amendment. The waiver set forth in Section 2 of this Eighth Amendment is limited
to the specific matter and circumstances described herein, and no further or
additional waiver as to any other obligations under the Credit Agreement is
granted hereby.
Section 6. Conditions to Effectiveness. This Eighth Amendment shall
become effective only upon (i) completion of the execution and delivery to the
Agent of an Amendment and Confirmation of Guaranty, dated the date hereof and
substantially in the form attached hereto as Exhibit A, by each of the
Borrower's Subsidiaries which is a Guarantor, and (ii) payment of the Closing
Fees specified in Section 8 below.
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Section 7. Bringdown. The Borrower hereby confirms that all
representations and warranties with respect to the Borrower and any Subsidiaries
contained in the Credit Agreement and each of the other Loan Documents and in
any other certificate or document delivered in connection therewith are true and
correct as of the date hereof, and that no Default or Event of Default is
outstanding or would be created by the consummation of the transactions
described herein.
Section 8. Fees, Costs and Expenses.
(a) In connection with the execution of this Eighth Amendment,
the Borrower shall pay a Closing Fee to each Bank in an amount equal to (i) such
Bank's respective Commitment times (ii) .125%.
(b) In addition to the foregoing Closing Fees, the Borrower
agrees to pay on demand all reasonable costs and expenses of the Agent and the
Banks, including without limitation all reasonable fees and expenses of counsel,
in connection with the preparation, execution and delivery of this Eighth
Amendment and the other documents and instruments to be delivered herewith.
Section 9. Miscellaneous. This Eighth Amendment may be executed in
several counterparts and by each party on a separate counterpart, each of which
when executed and delivered shall be an original, and all of which together
shall constitute one instrument. In proving this Eighth Amendment, it shall not
be necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought. This Eighth Amendment is intended
to take effect as a sealed instrument and shall for all purposes be construed in
accordance with and governed by the laws of The Commonwealth of Massachusetts,
(excluding the laws applicable to conflicts or choice of law).
******
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IN WITNESS WHEREOF, the parties hereto have caused this Eighth
Amendment to be duly executed as an instrument under seal as of the date first
above written.
PROVANT, INC.
By: /s/ Rajiv Bhatt
--------------------------------
Title: Executive Vice President
CITIZENS BANK OF MASSACHUSETTS
By: /s/ Michael S. St. Jean
--------------------------------
Title: Vice President
FLEET NATIONAL BANK
By: /s/ Michael J. Bassick
--------------------------------
Title: Vice President
KEYBANK NATIONAL ASSOCIATION
By: /s/ Lisa L. Turilli
--------------------------------
Title: Vice President
WELLS FARGO BANK IOWA, N.A.
By: /s/ Robert S. Gagne
--------------------------------
Title: Vice President
FLEET NATIONAL BANK, as AGENT
By: /s/ Michael J. Bassick
--------------------------------
Title: Vice President
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EXHIBIT A
AMENDMENT AND CONFIRMATION OF GUARANTY
This AMENDMENT AND CONFIRMATION OF GUARANTY (the "Guaranty Amendment"),
dated as of June 30, 2000, is entered into by each of the parties identified as
a Guarantor on the signature page hereto, all of which are "Guarantors" under
that certain Guaranty, dated as of May 29, 1998, as supplemented by various
Instruments of Adherence thereto and prior Amendment and Confirmation of
Guaranty instruments dated as of December 31, 1998, March 31, 1999, June 29,
1999, September 30, 1999 and December 10, 1999, respectively (as so described,
the "Guaranty"), made by such Guarantors in favor of Fleet National Bank, as
Agent. All capitalized terms used herein without definition shall have the
respective meanings set forth in the Credit Agreement (as hereinbelow defined).
WHEREAS, the Agent is a party to that certain Revolving Credit
Agreement, dated as of April 8, 1998 (as thereafter supplemented or amended
prior to the date hereof, the "Credit Agreement") among PROVANT, Inc. (the
"Borrower"), the Agent and the Banks named therein; and
WHEREAS, the Borrower and the Guarantors are members of a group of
related corporations, and each of the Guarantors has previously entered into the
Guaranty for the purpose of assuring payment of all Obligations (as defined in
the Credit Agreement) of the Borrower; and
WHEREAS, the Banks, the Agent and the Borrower this day intend to enter
into a Eighth Amendment to Revolving Credit Agreement (the "Eighth Amendment"),
which, inter alia, provides for certain amendments, modifications or waivers of
the Banks with respect to the provisions of the Credit Agreement; and it is a
condition precedent to the Banks' willingness to enter into the Eighth Amendment
and to continue to make Revolving Credit Loans or extend credit under the Credit
Agreement that each of the Guarantors execute and deliver this Guaranty
Amendment.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
hereto agree as follows:
1. All references to the "Credit Agreement" appearing in the Guaranty
(including references to capitalized terms which are defined in the Credit
Agreement) shall mean and refer to the Credit Agreement as it is amended and
supplemented by the Eighth Amendment and as it may be further amended,
supplemented, modified or restated and in effect from time to time hereafter,
and including without limitation any such amendment, supplement, modification or
restatement which increases the amount of Indebtedness owing by the Borrower
thereunder.
2. The Guarantors hereby ratify and confirm the Guaranty, as
supplemented or modified by this Guaranty Amendment, as remaining in full force
and effect.
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3. This Guaranty Amendment shall be governed by and construed in
accordance with the laws of The Commonwealth of Massachusetts (excluding the
laws applicable to conflicts or choice of law).
IN WITNESS WHEREOF, each of the Guarantors has caused this Guaranty
Amendment to be executed and delivered as an instrument under seal as of the
date first above written.
[Remainder of page intentionally left blank.]
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GUARANTORS:
BT. NOVATIONS, INC.
By:______________________________
Title:
DECKER COMMUNICATIONS, INC.
By:______________________________
Title:
J. HOWARD & ASSOCIATES, INC.
By:______________________________
Title:
NOVATIONS GROUP, INC.
By:______________________________
Title:
AMERICAN MEDIA INCORPORATED
By:______________________________
Title:
STRATEGIC INTERACTIVE, INC.
By:______________________________
Title:
MOHR LEARNING, INC.
By:______________________________
Title:
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STAR MOUNTAIN, INC.
By:______________________________
Title:
KC-EP, INC.
By:______________________________
Title:
PROVANT UTAH, INC.
By:______________________________
Title:
STAR MEDIA, INC.
By:______________________________
Title:
STAR DIGITAL, INC.
By:______________________________
Title:
PROVANT SERVICES, INC.
By:______________________________
Title
SENN-DELANEY LEADERSHIP
CONSULTING GROUP, INC.
By:______________________________
Title
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PMSI-PROJECT MENTORS, INC.
By:______________________________
Title
SALES PERFORMANCE
INTERNATIONAL, INC.
By:______________________________
Title:
SOLUTION SELLING, INC.
By:______________________________
Title:
FPMI COMMUNICATIONS, INC.
By:______________________________
Title:
Accepted:
FLEET NATIONAL BANK, As Agent
By:______________________________
Title:
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