Exhibit 10.1
EXECUTION VERSION
 
AMENDMENT NO. 1 TO THE CREDIT AGREEMENT
AMENDMENT NO. 1 TO THE CREDIT AGREEMENT (this “Amendment”) dated as of November
15, 2010, by and among NORTEK, INC., the other Loan Parties party hereto, the
Lenders party hereto and BANK OF AMERICA, N.A., as Administrative Agent for the
Lenders.
PRELIMINARY STATEMENTS:
(1)    The Borrowers, the Guarantors, the Lenders, the Administrative Agent and
the other parties thereto have entered into that certain Credit Agreement, dated
as of December 17, 2009 (as amended, restated, amended and restated,
supplemented or otherwise modified through the date hereof, the “Credit
Agreement”). Capitalized terms not otherwise defined in this Amendment have the
meanings specified in the Credit Agreement.
(2)    The Specified U.S. Borrower has requested the ability to issue up to
$500,000,000 in aggregate principal amount of senior unsecured notes to
refinance certain existing Indebtedness and for working capital and other
general corporate purposes of the Specified U.S. Borrower and its Subsidiaries
(including Permitted Acquisitions and other Investments permitted under the
Credit Agreement) and in connection therewith, the Specified U.S. Borrower has
requested certain modifications to the Credit Agreement to permit the issuance
of such Indebtedness.
(3)    The Required Lenders have agreed, subject to the terms and conditions
hereinafter set forth, to amend the Credit Agreement in response to the
Specified U.S. Borrower's request as set forth herein.
NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the sufficiency and receipt of all of which is hereby
acknowledged, the parties hereto hereby agree as follows:
SECTION 1.Amendments to Credit Agreement. Effective as of the Effective Date (as
defined below), the Credit Agreement is hereby amended as follows:
 
(a)    Section 1.01 of the Credit Agreement is amended by inserting the
following new definitions in their correct alphabetical order:
“Permitted Specified Indebtedness” means unsecured Indebtedness consisting of
notes under indentures or similar instruments; provided that: (a) (i) the terms
of such Indebtedness do not provide for any scheduled repayment, mandatory
redemption or sinking fund obligations prior to the date that is six months
after the Maturity Date (other than customary offers to repurchase upon a change
of control, asset sale or event of loss and customary acceleration rights after
an event of default) and (ii) the covenants, events of default, guarantees and
other terms of such Indebtedness are customary for similar Indebtedness in light
of then-prevailing market conditions (it being understood that such Indebtedness
shall not include any financial maintenance covenants and that any applicable
negative covenants shall be incurrence-based) and in any event, when taken as a
whole (other than interest rate and redemption premiums), are not more
restrictive to the Specified U.S. Borrower and the Subsidiaries than those set
forth in this Agreement (provided that a certificate of a Responsible Officer of
the Specified U.S. Borrower delivered to the Administrative Agent in good faith
at least one Business Day prior to the incurrence of such Indebtedness, together
with a reasonably detailed description of the material terms and conditions of
such Indebtedness or drafts of the documentation relating thereto, stating that
the Specified U.S. Borrower has determined in good faith that such terms and
conditions satisfy the requirement set out in this clause (ii), shall be
conclusive evidence that such terms and conditions satisfy such requirement
unless the Administrative Agent provides notice to the Specified U.S. Borrower
of its objection during such one Business Day period); (b) immediately before
and immediately after giving effect

 

--------------------------------------------------------------------------------

 

to the incurrence of such Indebtedness, no Default shall have occurred and be
continuing; and (c) the Administrative Agent shall have received a certificate
from a Responsible Officer of the Specified U.S. Borrower, dated as of the date
of incurrence of such Indebtedness, certifying as to compliance with this
definition.
(b)     The definition of “Excluded Subsidiary” in Section 1.01 of the Credit
Agreement is amended by adding “or Permitted Specified Indebtedness” immediately
after “Senior Secured Notes” in each instance therein.
(c)     The definition of “Maturity Date” in Section 1.01 of the Credit
Agreement is amended by adding “(or any Permitted Specified Indebtedness, if
earlier)” immediately after “Senior Secured Notes” therein.
(d)    The definition of “Specified Issuance Proceeds” in Section 1.01 of the
Credit Agreement is amended by (i) replacing the “and” immediately prior to
clause (b) thereof with a comma and (ii) inserting the following new clause (c)
immediately after the end of clause (b) thereof:
“and (c) the incurrence of Permitted Specified Indebtedness by the Specified
U.S. Borrower”.
(e)    Section 7.02(h)(iv) of the Credit Agreement is amended by (i) replacing
the “$125,000,000” therein with “$325,000,000” and (ii) deleting the phrase
“plus the amount of any Specified Issuance Proceeds that finance any Permitted
Acquisitions in accordance with the terms hereof” at the end thereof.
(f)    Section 7.03(b) of the Credit Agreement is amended by amending and
restating clause (xiii) thereof as follows:
“(xiii)    Permitted Specified Indebtedness of the Specified U.S. Borrower in an
aggregate principal amount not to exceed $500,000,000 at any time outstanding;”.
 
(h)    Section 7.06(f) of the Credit Agreement is amended by inserting the
following new proviso immediately at the end thereof:
“provided that no proceeds from any Permitted Specified Indebtedness shall be
permitted to directly or indirectly finance any Restricted Payment permitted
under this Section 7.06(f)”.
 
(i)    Section 7.14(a) of the Credit Agreement is amended by adding “Permitted
Specified Indebtedness,” immediately after “Senior Secured Notes,” therein.
SECTION 2.Consent and Waiver The Required Lenders hereby consent to (a) the
irrevocable payment by the Specified U.S. Borrower to the Trustee of net cash
proceeds from the issuance of Permitted Specified Indebtedness solely for the
Trustee's application of such proceeds to the prepayment, redemption, purchase
or defeasance of the Senior Secured Notes and (b) the deposit by the Specified
U.S. Borrower of up to $250,000,000 in net cash proceeds from the issuance of
Permitted Specified Indebtedness in a segregated Deposit Account (the
“Designated Account”) that is not subject to the Liens created by the U.S.
Security Agreement (which Deposit Account, for the avoidance of doubt, will not
be subject to a Deposit Account Control Agreement) to the extent that such
proceeds are held solely for the purposes of financing (i) acquisitions of all
or substantially all of the assets or Equity Interests of any Person and (ii)
the prepayment, redemption, purchase or defeasance of Indebtedness; provided
that funds withdrawn from the Designated Account shall not thereafter be
permitted to be deposited back into the Designated Account.
 
SECTION 3.Conditions to Effectiveness. This Amendment shall become effective as
of the date (the “Effective Date”) on which the following conditions have been
satisfied or waived by the Required Lenders:
 
(a)The Administrative Agent shall have received counterparts of this Amendment
executed by the Loan Parties and the Required Lenders.
 

 

--------------------------------------------------------------------------------

 

(b)Immediately before and after giving effect to this Amendment:
 
(i) the representations and warranties of each Borrower and each other Loan
Party contained in Article V of the Credit Agreement or any other Loan Document
shall be true and correct in all material respects (or in all respects in the
case of any representations and warranties qualified by materiality) on and as
of the Effective Date, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they shall be
true and correct in all material respects (or in all respects in the case of any
representations and warranties qualified by materiality) as of such earlier
date, and except that the representations and warranties contained in Sections
5.05(a) and (b) of the Credit Agreement shall be deemed to refer to the most
recent statements furnished pursuant to Sections 6.01(a) and (b) of the Credit
Agreement, respectively; and
(ii) no Default or Event of Default shall exist, or would result from, the
effectiveness of this Amendment.
(c)The Administrative Agent shall have received a certificate from a Responsible
Officer of the Specified U.S. Borrower, dated as of the Effective Date,
certifying as to the matters set forth in Section 3(b) hereof.
 
(d)The Specified U.S. Borrower shall have paid all fees and expenses in
accordance with Section 6 hereof.
 
            
SECTION 4.Consent and Affirmation of the Loan Parties. Each Loan Party hereby
consents to the amendments and modifications to the Credit Agreement effected
hereby, and confirms and agrees that, notwithstanding the effectiveness of this
Amendment, each Loan Document to which such Loan Party is a party is, and the
obligations of such Loan Party contained in the Credit Agreement, as amended and
modified hereby, or in any other Loan Documents to which it is a party are, and
shall continue to be, in full force and effect and are hereby ratified and
confirmed in all respects, in each case as amended and modified by this
Amendment.
 
SECTION 5.Reference to and Effect on the Credit Agreement and the Loan
Documents. (a) On and after the effectiveness of this Amendment, each reference
in the Credit Agreement to “this Agreement”, “hereunder”, “hereof” or words of
like import referring to the Credit Agreement, and each reference in the Notes
and each of the other Loan Documents to “the Credit Agreement”, “thereunder”,
“thereof” or words of like import referring to the Credit Agreement, shall mean
and be a reference to the Credit Agreement, as amended and modified by this
Amendment.
 
(b)    The Credit Agreement, the Notes and each of the other Loan Documents, as
specifically amended and modified by this Amendment 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 Collateral Documents and
all of the Collateral described therein do and shall continue to secure the
payment of all Obligations of the Loan Parties under the Loan Documents to the
extent provided in the Collateral Documents.
 
(c)    The execution, delivery and effectiveness of this Amendment shall not,
except as expressly provided herein, operate as a waiver of any right, power or
remedy of any Lender, any L/C Issuer, any Swing Line Lender, any Collateral
Agent or the Administrative Agent under any of the Loan Documents, nor
constitute a waiver of any provision of any of the Loan Documents.
 
(d)    The Loan Parties agree that this Amendment shall be a Loan Document for
all purposes of the Credit Agreement (as specifically amended by this Amendment)
and the other Loan Documents.
 
SECTION 6.Expenses. The Specified U.S. Borrower agrees that all reasonable and
documented out-of-pocket expenses incurred by the Administrative Agent in
connection with the preparation, execution, delivery and administration,
modification and amendment of this Amendment and the other instruments and
documents to be delivered hereunder or in connection herewith (including,
without limitation, the reasonable and documented fees,

 

--------------------------------------------------------------------------------

 

charges and disbursements of one firm of counsel for the Administrative Agent)
are expenses that the Specified U.S. Borrower is required to pay or reimburse
pursuant to Section 11.04 of the Credit Agreement.
 
SECTION 7.Execution in Counterparts. This Amendment may be executed in any
number of 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 but one and the same agreement. Delivery
of an executed counterpart of a signature page to this Amendment by telecopier
or electronic transmission (e.g., .pdf or .tif file) shall be effective as
delivery of a manually executed counterpart of this Amendment.
 
SECTION 8.Miscellaneous. Section and subsection headings appearing herein are
included solely for convenience of reference and are not intended to affect the
interpretation of any provision of this Amendment. This Amendment shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns. Any provision of this Amendment that is
prohibited or unenforceable in any jurisdiction shall not invalidate the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
 
SECTION 9.Governing Law. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of New York.
 
[Remainder of Page Intentionally Blank]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 

--------------------------------------------------------------------------------

 

 
 
 
 
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.
 
NORTEK, INC.,
as the Specified U.S. Borrower and a Guarantor
 
 
By:/s/ Edward J. Cooney                                                  
Name:    Edward J. Cooney
Title:    Vice President & Treasurer
 
 
VENTROL AIR HANDLING SYSTEMS INC.,
as the Canadian Borrower and a Guarantor
 
 
By:/s/ Edward J. Cooney                                                  
Name:    Edward J. Cooney
Title:    Vice President and Treasurer
 

 

--------------------------------------------------------------------------------

 

 
 
AIGIS MECHTRONICS, INC.
BROAN-MEXICO HOLDINGS, INC.
BROAN-NUTONE LLC
BROAN-NUTONE STORAGE SOLUTIONS LP
CES GROUP, LLC
CES INTERNATIONAL LTD.
CLPK, LLC
ELAN HOME SYSTEMS, L.L.C.
GATES THAT OPEN, LLC
GEFEN, LLC
GOVERNAIR LLC
HUNTAIR, INC.
HUNTAIR MIDDLE EAST HOLDINGS, INC.
INTERNATIONAL ELECTRONICS, LLC
LINEAR LLC
LITE TOUCH, INC.
MAGENTA RESEARCH LTD.
MAMMOTH, INC.
NILES AUDIO CORPORATION
NORDYNE LLC
NORDYNE INTERNATIONAL, INC.
NORTEK INTERNATIONAL, INC.
NUTONE LLC
OMNIMOUNT SYSTEMS, INC.
OPERATOR SPECIALTY COMPANY, INC.
PACIFIC ZEPHYR RANGE HOOD INC.
PANAMAX LLC
RANGAIRE GP, INC.
RANGAIRE LP, INC.
SECURE WIRELESS, INC.
SPEAKERCRAFT, LLC
TEMTROL, LLC
XANTECH LLC
ZEPHYR VENTILATION, LLC,
as Borrowers and Guarantors
 
 
By:/s/ Edward J. Cooney                                                  
Name:    Edward J. Cooney
Title:    Vice President & Treasurer
(of entity listed or as an officer of the
managing member, sole member or general partner)    
 
 
 

 

--------------------------------------------------------------------------------

 

 
 
 
BROAN-NUTONE CANADA, INC.
INNERGY TECH, INC.
VENMAR CES, INC.
VENMAR VENTILATION (H.D.H.), INC.
VENMAR VENTILATION, INC.,
as Guarantors
 
 
 
By:/s/ Edward J. Cooney                                                  
Name:    
Title:    
 
 

 

--------------------------------------------------------------------------------

 

 
 
 
BANK OF AMERICA, N.A.,
as a Lender
 
 
By: /s/ Robert Anchundia                           
Name: Robert Anchundia
Title: Vice President
 
 
 

 

--------------------------------------------------------------------------------

 

 
 
General Electric Capital Corporation,
as a Lender
 
 
By: /s/ Philip F. Carfora                                   
Name: Philip F. Carfora
Title: Duly Authorized Signatory

 

--------------------------------------------------------------------------------

 

 
 
WELLS FARGO CAPITAL FINANCE, LLC (fka
WELLS FARGO FOOTHILL, LLC)
as a Lender
 
 
By: /s/ Thomas Forbath                                   
Name: Thomas Forbath
Title: Vice President
 

 

--------------------------------------------------------------------------------

 

 
UBS Loan Finance, LLC,
as a Lender
 
 
By: /s/ Mary E. Evans                                   
Name: Mary E. Evans
Title: Associate Director
 
 
By: /s/ Irja R. Osta                                  
Name: Irja R. Osta
Title: Associate Director
 

 

--------------------------------------------------------------------------------

 

 
PNC Bank, National Association,
as a Lender
 
 
By: /s/ David Weaver                                   
Name: David Weaver
Title: Vice President

 

--------------------------------------------------------------------------------

 

 

 

--------------------------------------------------------------------------------

 

 
US Bank National Association,
as a Lender
 
 
By: /s/ Lynn Gosselin                                 
Name: Lynn Gosselin
Title: Vice President
 
 

 

--------------------------------------------------------------------------------

 

 
 
 
 
SIEMENS FINANCIAL SERVICES, INC.
as a Lender
 
 
By: /s/ Anthony Casciano                                   
Name: Anthony Casciano
Title: Senior Vice President
 
 
By: /s/ James Tregillies                                  
Name: James Tregillies
Title: Vice President
 

 

--------------------------------------------------------------------------------

 

 
TD Bank, N.A.,
as a Lender
 
 
By: /s/ Albert J. Forzano                                   
Name: Albert J. Forzano
Title: Vice President
 
 
By: /s/ ____________                                  
Name:
Title:
 

 

--------------------------------------------------------------------------------

 

 
The Toronto-Dominion Bank,
as a Lender
 
 
By: /s/ David Carson                                   
Name: David Carson
Title: Vice President
 
 
By: /s/ Darcy Mack                                  
Name: Darcy Mack
Title: Vice President
 
 

 

--------------------------------------------------------------------------------

 

 
 
Acknowledged:
 
BANK OF AMERICA, N.A.,
as Administrative Agent
 
 
By: /s/ Robert Anchundia                             
Name: Robert Anchundia
Title: Vice President