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EXHIBIT 10.42
LIMITED WAIVER AND AMENDMENT NO. 6
TO
2001 AMENDED AND RESTATED NOTE PURCHASE AGREEMENT
This Limited Waiver and Amendment No. 6 (the "Waiver and
Amendment"),
dated as of January 30, 2004, is by and
among THC SYSTEMS, INC., a New York
corporation (the "Company"), ONEIDA LTD., a
New York corporation (the
"Guarantor"), ALLSTATE INSURANCE COMPANY
("Allstate"), ALLSTATE LIFE INSURANCE
COMPANY ("Allstate Life") and PACIFIC LIFE
INSURANCE COMPANY (together with
Allstate and Allstate Life, the
"Purchasers").
R E C I T A L S
A. Company,
Guarantor and Purchasers are parties to the 2001 Amended and
Restated Note Purchase Agreement dated as
of May 1, 2001 pertaining to those
certain notes with a maturity date of May
31, 2005, as amended by a Waiver and
Amendment No. 1 to 2001 Amended and
Restated Note Agreement dated as of December
7, 2001, an Amendment No. 2 to 2001 Amended
and Restated Note Agreement dated as
of April 23, 2002, an Amendment No. 3 to
2001 Amended and Restated Note
Agreement dated as of April 24, 2003, a
Limited Waiver and Amendment No. 4 to
2001 Amended and Restated Note Purchase
Agreement dated as of October 31, 2003
and a Limited Waiver and Amendment No. 5 to
2001 Amended and Restated Note
Purchase Agreement dated as of December 12,
2003 (as so amended or otherwise
modified, the "Note Agreement").
B. The Company
and the Guarantor have requested that the Purchasers (a)
waive payment of the mandatory principal
payment due to the Purchasers on
November 1, 2003 in the amount of
$3,890,000 pursuant to Section 2.1(a) of the
Note Agreement (the "Sinking Fund Payment")
until March 1, 2004, (b) waive the
Defaults and Events of Default arising out
of the Company's and the Guarantor's
failure to comply with Sections 7.12(a),
(b), (c) and (d) of the Note Agreement
for the Fiscal Quarter ended October 25,
2003, (c) waive any Defaults or Events
of Default that may have arisen out of the
Company's and the Guarantor's
failure, if any, to comply with Sections
6.11, 8.1(e) and 8.1(l) of the Note
Agreement and Sections 3.02, 3.03, 4.04(b)
and 4.13 of the Security Agreement by
having (i) allowed the registration of
certain intellectual property to lapse,
(ii) provided perfection certificates as
required pursuant to Section 4.04 of
the Security Agreement that (A) incorrectly
identified the registration, serial
number and/or application number for
certain intellectual property owned by the
Company or the Guarantor (as applicable)
and (B) identified certain intellectual
property as being owned by the Company or
the Guarantor which is not in fact
owned by such entity and (iii) applied for
the registration of certain
intellectual property without notifying the
Collateral Agent of such application
and/or registration and (d) amend the Note
Agreement to, among other things,
permit a Long-Term Lease for warehouse
space located in California or Nevada to
replace the leased warehouse located in
Ontario, California.
C. Each of the
Purchasers are willing to grant the waivers requested by the
Company and the Guarantor subject to and
upon the terms and conditions set forth
herein.
NOW, THEREFORE, the parties agree as follows:
1. Definitions.
All capitalized terms used in this Waiver and Amendment
which are not otherwise defined shall have
the meanings given to those terms in
the Note Agreement.
2. Waiver. The Purchasers
hereby waive, for the period commencing on the
Effective Date (as defined below) of this
Waiver and Amendment and ending on
March 1, 2004 (the "Waiver Period"), (a)
payment of the Sinking Fund Payment,
(b) the Defaults and Events of Default
arising out of the Company's and the
Guarantor's failure to comply with Sections
7.12(a), (b), (c) and (d) of the
Note Agreement for the Fiscal Quarter ended
October 25, 2003, (c) the Defaults
or Events of Default that may have arisen
out of the Company's and the
Guarantor's failure, if any, to comply with
Sections 6.11, 8.1(e) and 8.1(l) of
the Note Agreement and Sections 3.02, 3.03,
4.04(b) and 4.13 of the Security
Agreement by having (i) allowed the
registration of certain intellectual
property to
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lapse, (ii) provided perfection
certificates as required pursuant to Section
4.04 of the Security Agreement that (A)
incorrectly identified the registration,
serial number and/or application number for
certain intellectual property owned
by the Company or the Guarantor (as
applicable) and (B) identified certain
intellectual property as being owned by the
Company or the Guarantor which is
not in fact owned by such entity and (iii)
applied for the registration of
certain intellectual property without
notifying the Collateral Agent of such
application and/or registration, provided
that upon the expiration of the Waiver
Period, the waiver provided for herein
shall be immediately (without cure period
or notice) and automatically terminated in
its entirety and be of no force and
effect as if the waiver had never been
granted; provided further that (x) in the
event that any other creditor, or group of
creditors, of the Guarantor or any of
its Subsidiaries with claims aggregating in
excess of $1,000,000, (A)
accelerates the obligations of the
Guarantor or such Subsidiary to such creditor
or group of creditors, (B) commences
enforcement of their rights and remedies in
respect of the obligations of the Guarantor
or such Subsidiary to such creditor
or group or creditors, or (C) takes any
other action against the Guarantor or
any such Subsidiary to improve their
position as creditors of the Guarantor or
such Subsidiary (it being understood that
none of a meeting among lenders to
discuss options and alternatives, the mere
sending of a notice of default or
reservation of rights or the charging of a
customary work fee shall constitute
such an action) or (y) the Guarantor or any
of its Subsidiaries makes any
payments in respect of the $2,000,000
Promissory Note issued by the Guarantor
dated September 20, 2003 or voluntarily
reduces the Commitment under the Credit
Agreement, the waiver provided for herein
shall be immediately (without cure
period or notice) and automatically
terminated in its entirety and be of no
force and effect as if the waiver had never
been granted. This waiver is limited
to payment of the Sinking Fund Payment and
the Defaults and Events of Default
arising out of the Company's and the
Guarantor's failure to comply with Sections
7.12(a), (b), (c) and (d) of the Note
Agreement for the Fiscal Quarter ended
October 25, 2003, and the Defaults or
Events of Default that may have arisen out
of the Company's and the Guarantor's
failure, if any, to comply with Sections
6.11, 8.1(e) and 8.1(l) of the Note
Agreement and Sections 3.02, 3.03, 4.04(b)
and 4.13 of the Security Agreement in
connection with the above stated actions
concerning the Company and the Guarantors'
intellectual property and shall not
constitute or be construed as a waiver of
any other presently existing or future
Defaults or Events of Default.
3. Amendment to
Section 3.1(e) of the Note Agreement. Section 3.1(e) is
amended in its entirety to read as
follows:
"(e) No Contingent Liabilities or Adverse Changes. Neither the
Guarantor nor any of its Subsidiaries has any contingent
liabilities
which are material to the Guarantor and its Subsidiaries taken as
a
whole other than (i) as indicated on the financial statements
described in the foregoing paragraph (d) of this Section 3.1 and
(ii)
that may arise or may have arisen in connection with charges
related
to FAS 87. For any representations and warranties made on or after
the
Amendment No. 6 Effective Date, since January 27, 2001, there has
been
no material adverse change in the business, assets, operations,
prospects or condition, financial or otherwise, of the Guarantor
and
its Subsidiaries, taken as a whole, and no sale, transfer or
other
disposition of a material part of the assets or business of the
Guarantor or any Subsidiary, except for any material adverse
change
that has been publicly disclosed or otherwise disclosed in writing
to
the Purchasers on or
before the Amendment No. 6Effective Date."
4. Amendment to
Section 5.1 of the Note Agreement. Section 5.1 of the Note
Agreement is hereby amended by inserting
the following new defined term in the
appropriate alphabetical order:
""Amendment No. 6 Effective Date" means the date on which all
the
conditions to the Limited Waiver and Amendment No. 6, dated
January
30, 2004, have been satisfied."
16. Amendment to Section 7.16 of the Note Agreement. Section
7.16
of the Note
Agreement is hereby amended by inserting the following words
immediately
following the word "unless" appearing therein:
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"(i) such lease is for warehouse space located in California or
Nevada, provided, (A) the lease shall be on terms at least
reasonably
comparable to, or more favorable to the Guarantor than, the
current
lease in Ontario, California and (B) the leased facility shall
replace
the current leased facility in Ontario, California or (ii)"
17. Representation and Warranties. Each of the Guarantor and
the
Company
represents and warrants to the Purchasers that the following
statements are
true, correct and complete:
01 Representations and Warranties. Each of the representations
and
warranties made by the Guarantor and the
Company in the Note Agreement is true
and correct on and as of the date of this
Waiver and Amendment.
02 No Default or Event of Default. After giving effect to this
