Exhibit 10.26
FOURTH MODIFICATION TO
BUSINESS LOAN
AND SECURITY AGREEMENT AND
OTHER LOAN DOCUMENTS
THIS FOURTH MODIFICATION TO
BUSINESS LOAN AND SECURITY AGREEMENT AND OTHER LOAN
DOCUMENTS (this
“Modification”), dated January 18, 2006, but
effective for all purposes as of December 31, 2005, is made by
and among (i) Citizens Bank of Pennsylvania, a Pennsylvania
state chartered bank (“Citizens Bank”), acting in its
capacity as agent for the Lenders (the “Agent”);
(ii) Citizens Bank, acting in its individual capacity as Swing
Line Lender (the “Swing Line Lender”);
(iii) Citizens Bank, acting in its individual capacity as a
Lender and First Horizon Bank, a division of First Tennessee Bank
National Association (“First Horizon” and collectively
with Citizens Bank, the “Lenders”); and
(iv) Opinion Research Corporation, a Delaware corporation,
Macro International Inc., a Delaware corporation, Social and Health
Services, Ltd., a Maryland corporation, ORC Holdings, Ltd., an
English Company, O.R.C. International Ltd., an English Company, and
any other “Borrower” party to the hereinafter
referenced Loan Agreement from time to time (the
“Borrowers”) 1 . Capitalized terms used but not
defined herein shall have the meanings attributed to such terms in
the Loan Agreement.
W
I T N
E S S E T H
T H A T
:
WHEREAS
, on May 4, 2004, the Lenders
extended to the Borrowers loans and certain other financial
accommodations (collectively, the “Original Loan”) in
the aggregate maximum principal amount of Thirty-five Million and
No/100 Dollars ($35,000,000.00) pursuant to the terms and
conditions of a certain Business Loan and Security Agreement dated
as of May 4, 2004 (as the same may be modified or amended from
time to time, the “Loan Agreement”), by and among the
Borrowers, the Agent, the Swing Line Lender and the Lenders;
and
WHEREAS , pursuant to the terms of a certain First
Modification to Business Loan and Security Agreement and Other Loan
Documents dated March 15, 2005 (the “First
Modification”), the aggregate maximum principal amount of the
Original Loan was increased (as increased, the “Loan”)
from Thirty-five Million and No/100 Dollars ($35,000,000.00) to
Fifty Million and No/100 Dollars ($50,000,000.00) by the extension
to the Borrowers of a new term loan in the aggregate original
principal amount of Fifteen Million and No/100 Dollars
($15,000,000.00); and
WHEREAS
, pursuant to the terms of a certain
Second Modification to Business Loan and Security Agreement and
Other Loan Documents dated July 29, 2005 (the “Second
Modification”) the Loan was modified to permit the Borrowers
to obtain financing in the form of unsecured senior subordinated
debt from The Royal Bank of Scotland plc; and
WHEREAS
, pursuant to the terms of a certain
Third Modification to Business Loan and Security Agreement and
Other Loan Documents dated November 30, 2005 (the “Third
Modification”) the Loan was further modified to, among other
things, reallocate the Loan among the Lenders; and
WHEREAS
, the Loan is currently evidenced by
(i) a certain Revolving Promissory Note dated May 4, 2004
(together with all extensions, renewals, modifications, amendments,
replacements and substitutions thereof or therefor, the
“Citizens Revolving Note”), made by the Borrowers and
payable to the order of Citizens Bank in the maximum principal
amount of Twenty Million and No/100 Dollars
|
1
|
Note: The membership interests in
ORC ProTel, LLC, a Delaware limited liability company, were sold by
Opinion Research Corporation on December 31, 2005, and ORC
ProTel, LLC is no longer a Borrower.
|
($20,000,000.00), (ii) a certain Revolving
Promissory Note dated May 4, 2004 (together with all
extensions, renewals, modifications, amendments, replacements and
substitutions thereof or therefor, the “First Horizon
Revolving Note”), made by the Borrowers and payable to the
order of First Horizon in the maximum principal amount of Fifteen
Million and No/100 Dollars ($15,000,000.00), (iii) a certain
Swing Line Promissory Note dated May 4, 2004 (together with
all extensions, renewals, modifications, amendments, replacements
and substitutions thereof or therefor, the “Swing Line
Note”) made by the Borrowers and payable to the order of
Citizens Bank, in the maximum principal amount of Five Million and
No/100 Dollars ($5,000,000.00), and (iv) a certain Amended,
Restated and Consolidated Term Promissory Note dated
November 30, 2005 (together with all extensions, renewals,
modifications, amendments, replacements and substitutions thereof
or therefor, the “Citizens Term Note” and together with
the Citizens Revolving Note, the Swing Line Note and the First
Horizon Revolving Note, the “Notes”), made by the
Borrowers and payable to the order of Citizens Bank in the maximum
principal amount of Fifteen Million and No/100 Dollars
($15,000,000.00), each secured by, among other things, (a) the
Collateral described in the Loan Agreement and (b) certain
collateral documents, instruments and agreements executed, issued
and/or delivered by one or more of the Borrowers to the Agent for
the ratable benefit of the Lenders, in connection with the Loan;
and
WHEREAS,
the Borrowers have requested and the
Lenders have agreed to revise certain of the financial covenants of
the Borrowers set forth in the Loan Agreement, as hereinafter
provided, subject to the terms and conditions hereinafter set
forth.
NOW THEREFORE
, for Ten Dollars ($10.00) and other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
1. Recitals . The foregoing
recitals are hereby incorporated herein by this reference and made
a part hereof, with the same force and effect as if fully set forth
herein.
2. The definition of
“EBITDA” set forth in the Section of the Loan Agreement
titled “Certain Definitions” is hereby deleted in its
entirety and replaced with the following:
“EBITDA”
shall mean, as of the date of any
determination, the consolidated net income of the Parent Company,
including all Borrowers and Non-Borrower Subsidiaries, plus
interest expense, plus taxes, plus depreciation
expense, plus amortization expense, plus any
non-cash, non-recurring charges against income approved in writing
by the Agent, plus any non-cash stock-option expenses,
minus any non-cash gain (to the extent included in
determining net income), minus any dividends paid in
accordance with Section 7.8(a) of this Agreement to the extent
not deducted from net income, all as determined on a rolling four
(4) quarter consolidated basis in accordance with
GAAP.”
2
3. Sections 6.15(c) and 6.15(g) set
forth in the Loan Agreement are hereby deleted in their entirety,
and the following substituted in lieu thereof:
“(c) Leverage Ratio .
The Borrowers and the Non-Borrower Subsidiaries will maintain on a
consolidated basis for each quarter ending during the periods
specified below, a Leverage Ratio of not more than the
following:
|
|
|
|
|
|
|
Maximum
Leverage Ratio
|
|
December 31, 2005 through March 31,
2006
|
|
4.50 to 1.00
|
|
From April 1, 2006 through September 30,
2006
|
|
4.25 to 1.00
|
|
From and after October 1, 2006
|
|
4.00 to 1.00
|
For purposes of the foregoing,
“Leverage Ratio” shall mean, for each measurement
period, the ratio of the Borrower’s and the Non-Borrower
Subsidiaries’ Total Debt to EBITDA. The Leverage Ratio shall
be measured on the last day of each fiscal quarter throughout the
term of the Loan.
(g) Interest Coverage Ratio .
The Borrowers and the Non-Borrower Subsidiaries will maintain an
Interest Coverage Ratio, measured on the last day of each fiscal
quarter throughout the term of the Loan of: (i) at least 2.50
to 1.00 for each fiscal quarter up to and including the fiscal
quarter ending March 31, 2006; (ii) at least 2.00 to 1.00
for the fiscal quarter ending June 30, 2006 up to and
including the fiscal quarter ending March 31, 2007; and
(iii) at least 2.50 to 1.00 for the fiscal quarter ending
June 30, 2007 and each fiscal quarter thereafter. For purposes
of the foregoing, “Interest Coverage Ratio” shall mean,
for each measurement period, the ratio of EBITDA to the
Borrowers’ and the Non-Borrower Subsidiaries’ cash
interest expense during such period.”
4. The following language is hereby
added after the last sentence of Section 6.15(e) of the Loan
Agreement: “Notwithstanding the foregoing, for the fiscal
quarters