Exhibit 10.1
SECOND AMENDMENT TO CREDIT AND SECURITY AGREEMENT
     This Second Amendment to Credit and Security Agreement (“Second Amendment”)
is entered into as of December 8, 2006, by among Synergetics, Inc., a Missouri
corporation (“Synergetics”), and Synergetics USA, Inc., a Delaware corporation
(“Synergetics USA”), (individually, a “Borrower” and together, the “Borrowers”),
Regions Bank (“Regions”) in its capacities as Agent and a Lender, and Wachovia
Bank, National Association (“Wachovia”), in its capacity as a Lender.
RECITALS
     A. Borrowers and Regions entered into a certain Credit and Security
Agreement dated as of March 13, 2006, as heretofore amended by First Amendment
(the “First Amendment”) dated as of September 26, 2006 (as so amended, the
“Existing Credit Agreement”).
     B. Borrowers and Lenders desire to amend the Existing Credit Agreement as
hereinafter provided.
     C. The Existing Credit Agreement and this Second Amendment constitute the
“Credit Agreement” from and after the effectiveness of this Second Amendment.
     NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Borrowers, Lenders and Agent agree as follows:
     1. Defined Terms. Each term used herein without definition or a
modification to definition shall have the same meaning as set forth in the
Existing Credit Agreement.
     2. Credit Agreement Amendments. The Existing Credit Agreement is hereby
amended as follows, effective upon fulfillment of conditions set forth in
Section 3 of this Second Amendment:
          Section 1.2, entitled “Primary Definitions,” is hereby amended by
modifying the following definitions:

  (1)   “ ‘Notes’ and ‘Revolving Notes’ mean, individually and together, the
Amended and Restated Revolving Notes attached to the Second Amendment as
Exhibit A and Exhibit B, respectively, which replace (without novation) the
Notes referred to in the First Amendment.”

1

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

 

  (2)   “ ‘Revolving Loan Commitment’ means, collectively, $7,500,000, unless
said amount is reduced pursuant to Section 2.11(b) hereof, in which event it
means the aggregate amount to which said amount is reduced. The “Revolving Loan
Commitment” of each Lender is as follows:

              Lender’s Revolving Lender   Loan Commitment
Regions
  $ 4,773,000  
Wachovia
  $ 2,727,000 .” 

     3. Representations and Warranties. The Borrowers jointly and severally
hereby represent and warrant to the Lenders and to the Agent as follows:
          (a) This Second Amendment and the Revolving Notes have been duly and
validly executed by authorized officers of the Borrowers and constitute the
legal, valid and binding obligation of the Borrowers, enforceable against the
Borrowers in accordance with their terms. The Existing Credit Agreement, as
amended by this Second Amendment, remains in full force and effect and remains
the valid and binding obligation of the Borrowers, enforceable against the
Borrowers in accordance with its terms. The Borrowers hereby ratify and confirm
the Existing Credit Agreement, as amended by this Second Amendment.
          (b) No Default or Event of Default has occurred or now exists under
the Existing Credit Agreement and no Default or Event of Default will occur as a
result of the effectiveness of this Second Amendment.
          (c) The representations and warranties of the Borrower contained in
the Existing Credit Agreement, as modified by the Disclosure Schedule Amendment
attached hereto as Exhibit C (the “Disclosure Schedule Amendment”), are true and
correct in all material respects on and as of the date of this Second Amendment.
     4. Conditions to Effectiveness of Second Amendment. The effectiveness of
this First Amendment and the agreements set forth herein are subject to
fulfillment, as determined in the sole judgment of Agent, of the following
conditions:
          (a) Borrowers shall have executed and delivered to Agent this Second
Amendment, the Revolving Notes and the Disclosure Schedule Amendment and Agent
shall have determined that the Disclosure Schedule Amendment is acceptable to
Agent in its good faith determination;
          (b) Borrowers shall have delivered to Agent a Certificate of the
Secretary or an Assistant Secretary of each Borrower certifying appropriate
corporate actions authorizing the execution and delivery of this Second
Amendment and the Revolving Notes and covering such other matters as Agent may
reasonably request;

2

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

 

          (c) Agent shall have determined that no Default or Event of Default
exists; and
          (d) Borrowers shall have delivered such other documents and shall have
taken such other actions as Agent in its reasonable discretion may require.
     5. Release. In consideration of the agreement of Lenders and Agent to
modify the terms of the Existing Credit Agreement as set forth in this Second
Amendment, Borrowers hereby release, discharge and acquit forever Lenders and
Agent and any of their respective officers, directors, servants, agents,
employees and attorneys, past and present, from any and all claims, demands and
causes of action, of whatever nature, whether in contract or tort, accrued or to
accrue, contingent or vested, known or unknown, arising out of or relating to
the loans evidenced by the Existing Credit Agreement, as hereby amended, or
Agent’s or Lenders’ administration of the same or any other actions taken
pursuant to the Existing Credit Agreement or under any other documents or
instruments evidencing loans made by Lenders to Borrowers or the administration
of same; provided, however, that the foregoing release and the following
indemnity relate only to actions or inactions of Agent or Lenders through the
date hereof.
     6. Payment of Costs/Expenses. Without limiting the generality of provisions
in the Existing Credit Agreement (as amended by this Second Amendment) relating
to payment of Agent’s or Lenders’ costs and expenses, the Borrower will pay all
reasonable out-of-pocket expenses, costs and charges of Agent’s attorneys
incurred in connection with the preparation and implementation of this Second
Amendment.
     7. Other Documents/Provisions to Remain in Force. Except as expressly
amended hereby, the Existing Credit Agreement and all documents and instruments
executed in connection therewith or contemplated thereby and all indebtedness
incurred pursuant thereto shall remain in full force and effect and are in all
respects hereby ratified and affirmed.
     8. Successors and Assigns. Subject to any restriction on assignment set
forth in the Existing Credit Agreement, this Second Amendment shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
     9. Counterparts. This Second Amendment may be executed in any number of
counterparts, each of which shall constitute one and the same Amendment.
     10. Incorporation by Reference. The Existing Credit Agreement and all
exhibits thereto, and the exhibits to this Second Amendment are incorporated
herein by this reference, except to the extent replaced by Exhibits attached to
this Second Amendment.

3

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

 

     11. No Oral Loan Agreements. Pursuant to Mo. Rev. Stat. § 432.045 and §
432.047, the parties agree to the quoted language below (all references to “you”
are references to Borrower and all references to “us” are references to Agent
and Lenders):
ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FOREBEAR FROM
ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT
ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS BASED, THAT
IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT. TO PROTECT YOU (BORROWER) AND US
(AGENT AND LENDERS) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS WE
REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE
AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER
AGREE IN WRITING TO MODIFY IT.
[Remaining portion of page is intentionally blank. Signature page follows]

4

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

 

     IN WITNESS WHEREOF, Lenders, Agent and Borrowers have caused this Second
Amendment to be executed effective as of the date first written above.

            BORROWERS:

SYNERGETICS, INC.
      By:   /s/ Pamela G. Boone       Name:   Pamela G. Boone      Title:  
Chief Financial Officer and        and           SYNERGETICS, USA, INC.
      By:   /s/ Pamela G. Boone       Name:   Pamela G. Boone      Title:  
Chief Financial Officer        AGENT:

REGIONS BANK
      By:   /s/ Anne D. Silvestri       Name:   Anne D. Silvestri      Title:  
Senior Vice President        LENDERS:

REGIONS BANK
      By:   /s/ Anne D. Silvestri       Name:   Anne D. Silvestri      Title:  
Senior Vice President        WACHOVIA BANK, NATIONAL ASSOCIATION
      By:   /s/ Linda M. Douglas       Name:   Linda M. Douglas      Title:  
Senior Vice President   

5

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

 

         

TABLES OF EXHIBITS TO SECOND AMENDMENT
Exhibit A Amended and Restated Revolving Note Payable to Regions

Exhibit B Amended and Restated Revolving Note Payable to Wachovia
Exhibit C Disclosure Schedule Amendment

6

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

 

Exhibit A to Second
Amendment to
Credit and Security
Agreement
AMENDED AND RESTATED
REVOLVING NOTE
(Regions Bank)
$4,773,000
St. Louis, Missouri
December ___, 2006
     FOR VALUE RECEIVED, the undersigned, SYNERGETICS, INC., a Missouri
corporation, and SYNERGETICS USA, INC., a Delaware corporation (individually, a
“Borrower” and together, the “Borrowers”), hereby jointly and severally promise
to pay on the Termination Date to the order of Regions Bank (the “Lender”), at
its main office in St. Louis, Missouri, or at any other place designated at any
time by the holder hereof, in lawful money of the United States of America and
in immediately available funds, the principal sum of Four Million Seven Hundred
Seventy-Three Thousand and 00/100 ($4,773,000) or, if less, the aggregate unpaid
principal amount of all Advances and Swing Line Loans made by the Lender to the
Borrowers under the Credit Agreement (defined below), together with interest on
the principal amount hereunder remaining unpaid from time to time, computed on
the basis of the actual number of days elapsed and a 360-day year, from the date
hereof until this Note is fully paid at the rate from time to time in effect
under the Credit and Security Agreement dated as of March 13, 2006, as
heretofore amended by First Amendment dated as of September 26, 2006, and as
further amended by Second Amendment of even date herewith (as so amended, the
“Credit Agreement”) by and among the Lender, Wachovia Bank, National
Association, and the Borrowers. The principal hereof and interest accruing
thereon shall be due and payable as provided in the Credit Agreement. This Note
may be prepaid only in accordance with the Credit Agreement.
     This Note is issued pursuant, and is subject, to the Credit Agreement,
which provides, among other things, for acceleration hereof. This Note is the
Revolving Note referred to in the Credit Agreement. This Note evidences not only
all Advances of Lender under the Revolving Credit Facility but also all Swing
Line Loans made by Lender pursuant to Section 2.1A of the Credit Agreement.
     This Note, among other things, is secured pursuant to the Credit Agreement
and the Security Documents as therein defined, and may now or hereafter be
secured by one or more other security agreements, mortgages, deeds of trust,
assignments or other instruments or agreements.
     The Borrowers hereby agree to pay all costs of collection, including
attorneys’ fees and legal expenses in the event this Note is not paid when due,
whether or not legal proceedings are commenced.

7

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

 

     Presentment or other demand for payment, notice of dishonor and protest are
expressly waived.
     This Note shall be governed by the internal substantive laws of the State
of Missouri, without regard for its conflicts-of-law principles.
     This Note is a replacement for, but not a novation or refinancing of, the
Revolving Note dated as of September 26, 2006 by Borrowers payable to the order
of Lender. This Note does not evidence or effect a release, or relinquishment of
the priority, of the security interests in any Collateral (as defined in the
Credit Agreement).
     ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR
FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH
DEBT ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS BASED,
THAT IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT. TO PROTECT YOU
(BORROWERS) AND US (LENDER) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY
AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING (THIS
NOTE, THE CREDIT AGREEMENT AND THE LOAN DOCUMENTS REFERRED TO THEREIN), WHICH IS
THE COMPLETE AND EXCLUSIVE STATEMENTS OF THE AGREEMENT BETWEEN US, EXCEPT AS WE
MAY LATER AGREE IN WRITING TO MODIFY IT.

            BORROWERS:

SYNERGETICS, INC.
      By:             NAME: Pamela G. Boone          TITLE: Chief Financial
Officer and        and          SYNERGETICS USA, INC.
      By:             NAME: Pamela G. Boone          TITLE: Chief Financial
Officer   

8

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

 

         

Exhibit B to Second Amendment to
Credit and Security
Agreement
AMENDED AND RESTATED
REVOLVING NOTE
(Wachovia Bank, National Association)

     
$2,727,000
  St. Louis, Missouri
 
  December ___, 2006

     FOR VALUE RECEIVED, the undersigned, SYNERGETICS, INC., a Missouri
corporation, and SYNERGETICS USA, INC., a Delaware corporation (individually, a
“Borrower” and together, the “Borrowers”), hereby jointly and severally promise
to pay on the Termination Date to the order of Wachovia Bank, National
Association (the “Lender”), at the main office of Regions Bank in St. Louis,
Missouri, or at any other place designated at any time by the holder hereof, in
lawful money of the United States of America and in immediately available funds,
the principal sum of Two Million Seven Hundred Twenty-Seven Thousand and 00/100
($2,727,000) or, if less, the aggregate unpaid principal amount of all Advances
made by the Lender to the Borrowers under the Credit Agreement (defined below),
together with interest on the principal amount hereunder remaining unpaid from
time to time, computed on the basis of the actual number of days elapsed and a
360-day year, from the date hereof until this Note is fully paid at the rate
from time to time in effect under the Credit and Security Agreement dated as of
March 13, 2006, as heretofore amended by First Amendment dated as of
September 26, 2006 and as further amended by Second Amendment of even date
herewith (as so amended, the “Credit Agreement”) by and among the Lender,
Regions Bank and the Borrowers. The principal hereof and interest accruing
thereon shall be due and payable as provided in the Credit Agreement. This Note
may be prepaid only in accordance with the Credit Agreement.
     This Note is issued pursuant, and is subject, to the Credit Agreement,
which provides, among other things, for acceleration hereof. This Note is the
Revolving Note referred to in the Credit Agreement.
     This Note, among other things, is secured pursuant to the Credit Agreement
and the Security Documents as therein defined, and may now or hereafter be
secured by one or more other security agreements, mortgages, deeds of trust,
assignments or other instruments or agreements.
     The Borrowers hereby agree to pay all costs of collection, including
attorneys’ fees and legal expenses in the event this Note is not paid when due,
whether or not legal proceedings are commenced.
     Presentment or other demand for payment, notice of dishonor and protest are
expressly waived.

9

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

 

     This Note shall be governed by the internal substantive laws of the State
of Missouri, without regard for its conflicts-of-law principles.
     This Note is a replacement for, but not a novation or refinancing of the
Revolving Note dated as of September 26, 2006 by Borrowers payable to the order
of Lender. This Note does not evidence or effect a release, or relinquishment of
the priority, of the security interests in any Collateral (as defined in the
Credit Agreement).
     ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR
FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH
DEBT ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS BASED,
THAT IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT. TO PROTECT YOU
(BORROWERS) AND US (LENDER) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY
AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING (THIS
NOTE, THE CREDIT AGREEMENT AND THE LOAN DOCUMENTS REFERRED TO THEREIN), WHICH IS
THE COMPLETE AND EXCLUSIVE STATEMENTS OF THE AGREEMENT BETWEEN US, EXCEPT AS WE
MAY LATER AGREE IN WRITING TO MODIFY IT.

            BORROWERS:

SYNERGETICS, INC.
      By:             NAME: Pamela G. Boone          TITLE: Chief Financial
Officer and        and          SYNERGETICS USA, INC.
      By:             NAME: Pamela G. Boone          TITLE: Chief Financial
Officer     

10

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

 

Exhibit C to Second
Amendment to
Credit and Security
Agreement
DISCLOSURE SCHEDULE AMENDMENT

11