Exhibit 10.23

 

FIRST AMENDMENT AND WAIVER TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

AND OTHER LOAN DOCUMENTS

 

THIS FIRST AMENDMENT AND WAIVER TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
AND OTHER LOAN DOCUMENTS (the “Amendment”) is made and entered as of October 22,
2013, and is by and among Fifth Third Bank, an Ohio banking corporation
(“Lender”), Superior Uniform Group, Inc., a Florida corporation (“Borrower”),
and Borrower’s Wholly Owned Subsidiaries, Fashion Seal Corporation, a Nevada
corporation (“Fashion Seal”), and The Office Gurus, LLC, a Florida limited
liability company (“TOG”). Borrower, Fashion Seal, TOG and each other Person
becoming a Subsidiary Loan Party and a Guarantor at any time as provided in
Sections 6.19 and 6.20 of the Credit Agreement (as herein defined), are each
individually sometimes referred to herein as a “Loan Party” and collectively as
the “Loan Parties”.

 

W I T N E S S E T H:

 

WHEREAS, the parties and Superior Office Solutions, Inc., a Nevada corporation
(“SOS”), have previously entered into that certain Second Amended and Restated
Credit Agreement (the “Existing Credit Agreement” and as amended and modified by
this Amendment and as the same may be further amended, modified, restated or
supplemented at any time hereafter, the “Credit Agreement”) dated as of July 1,
2013; and,

 

WHEREAS, (i) Schedule 5.16(b) to the Credit Agreement delivered on the Closing
Date omitted indirect Subsidiaries of Loan Parties, including Superior Sourcing,
a Cayman Islands exempted company with limited liability, an indirect Subsidiary
of the Borrower and a direct Subsidiary of SUG Holding, a Cayman Islands
exempted company (“SUG Holding”), and (ii) Schedule 5.16(b) of the Credit
Agreement and Schedule IV to the Security Agreement each misidentified The
Office Gurus, Ltd., a Belize company, as “The Office Gurus, LTDA” (collectively,
the “Schedule Errors”);

 

WHEREAS, subsequent to the date of the Existing Credit Agreement, in violation
of Section 7.03(a) of the Existing Credit Agreement, (i) SOS contributed its
ownership interests in certain of its Subsidiaries to SUG Holding in exchange
for the issuance of 0.04 shares of capital stock of SUG Holding (the “SUG
Holding Interest”), (ii) SOS transferred the SUG Holding Interest to the
Borrower, and (iii) SOS and Scratt Kit S.R.L., a Subsidiary of SOS, were each
dissolved (collectively, the “SOS Dissolution”);

 

WHEREAS, the Loan Parties have requested that Lender agree to (i) waive any
Event of Default and/or Default Condition as a result of the SOS Dissolution or
the Schedule Errors and (ii) make certain other amendments and modifications to
the Existing Credit Agreement and the Security Agreement as herein provided;

 

WHEREAS, Lender is willing to (i) grant a waiver of any Event of Default and/or
Default Condition as a result of the SOS Dissolution or the Schedule Errors, as
provided above, and (ii) amend and modify the Existing Credit Agreement and the
Security Agreement on the terms and conditions contained herein;

 

NOW, THEREFORE, in consideration of the premises, the mutual covenants herein
contained and other good and valuable consideration, the receipt, adequacy and
sufficiency of which is hereby acknowledged, the parties hereto, intending
legally to be bound, hereby agree as follows:

 

1.     Recitals. The foregoing recitals are true and correct and are hereby
incorporated by reference into and made a part of this Amendment for all
purposes.

 

2.     Certain Terms and Definitions. The initially capitalized and/or
capitalized terms used in this Amendment which are not otherwise defined in this
Amendment shall have the meanings ascribed to said terms in the Existing Credit
Agreement.

  

 
 

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3.     Reaffirmation. The Loan Parties each acknowledge and reaffirm that the
Credit Agreement and each of the other Loan Documents to which they are a party
continues to remain in full force and effect in the manner and to the extent set
forth therein, and the Credit Agreement and each such other Loan Document
constitute the legal, valid and binding obligation of the Loan Parties which are
party thereto, enforceable against them in accordance with their respective
terms.

 

4.     Amendments. In reliance on the representations and warranties set forth
in Section 6 of this Amendment and subject to the satisfaction of the conditions
precedent set forth in Section 7 of this Amendment, the Existing Credit
Agreement and the Security Agreement are each hereby amended effective as of,
from and after the date of this Amendment as follows:

 

(a)     SOS, having been dissolved, shall no longer be a Loan Party or a party
to the Credit Agreement or any other Loan Document and each reference in the
Existing Credit Agreement or the other Loan Documents to SOS shall be deemed to
be removed and the Credit Agreement and each such other Loan Document shall be
read as of, from and after the date hereof, as if such reference did not exist.

 

(b)     Schedule 5.16(b) to the Existing Credit Agreement is hereby replaced as
of the Closing Date with Schedule 5.16(b) attached as Exhibit A to this
Amendment.

 

(c)     Schedule 5.16(b) to the Existing Credit Agreement is hereby replaced as
of, from and after the date of this Amendment with Schedule 5.16(b) attached as
Exhibit B to this Amendment.

 

 

(d)     Section 7.04(d) of the Existing Credit Agreement is hereby modified and
amended as of, from and after the date of this Amendment so as to provide that
the reference to the dollar amount of “$1,000,000.00” as set forth in the last
line of said Section is changed to “$5,000,000.00”.

 

(e)     Schedule IV to the Security Agreement is hereby replaced as of the
Closing Date with Schedule IV attached as Exhibit C to this Amendment.

 

(f)     Schedule IV to the Security Agreement is hereby replaced as of, from and
after the date of this Amendment with Schedule IV attached as Exhibit D to this
Amendment.

 

 

5.     Waiver as to SOS Dissolution and Schedule Errors; Consent to Transfer of
SOS Foreign Subsidiaries. In reliance on the representations and warranties set
forth in Section 6 of this Amendment and subject to the satisfaction of the
conditions precedent set forth in Section 7 of this Amendment, Lender does
hereby waive any Event of Default and/or Default Condition resulting from the
SOS Dissolution or the Schedule Errors. Lender does further consent to the
transfer of each of the Subsidiaries of SOS and equity interests in SUG Holding
as set forth in Schedule 5.16(b) to the Existing Agreement (as amended by
Section 4(b) herein) to SUG Holding and as set forth on Schedule 5.16(b)
attached as Exhibit B to this Amendment.

 

6.     Representations and Warranties. Each Loan Party hereby represents and
warrants to Lender that:

 

(a)     the representations and warranties of each Loan Party contained in the
Credit Agreement and each of the other Loan Documents (as amended hereby), or
which are contained in any document furnished at any time under or in connection
herewith or therewith, are true and correct in all material respects on and as
of the date of this Amendment, except to the extent that such representations
and warranties specifically refer to an earlier date, in which case they shall
be true and correct as of such earlier date;

 

(b)     this Amendment, the Credit Agreement and each of the other Loan
Documents constitute the legal, valid, and binding obligation of the Loan
Parties to the extent a party thereto, enforceable against the Loan Parties in
accordance with their respective terms;

  

 
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(c)     no Event of Default and/or Default Condition has occurred and is
continuing, which will not be cured by, or will result from, the execution,
delivery and performance of the terms and conditions of this Amendment;

 

(d)     no event or circumstance since the effective date of the Existing Credit
Agreement has occurred that has had or could be reasonably expected to have,
either individually or in the aggregate, a Material Adverse Effect; and

 

(e)     each Loan Party has performed all of its obligations under the Credit
Agreement and each of the other Loan Documents which are to be performed
contemporaneously with or prior to the date hereof.

 

7.     Conditions Precedent. The effectiveness of this Amendment is subject to
the receipt by the Lender of each of the following (each appropriately completed
and duly executed and delivered as required and otherwise in form and substance
satisfactory to the Lender):

 

(a)     this Amendment;

 

(b)     evidence of payment by the Borrower of all accrued and unpaid fees,
costs and expenses to the extent then due and payable on the date hereof,
together with all attorneys’ fees and costs of Lender incurred in connection
with the evaluation of the circumstances surrounding, the negation of, and the
documentation of this Amendment; and

 

(c)     such other instruments, agreements and documents as the Lender may
reasonably request.

 

8.     Miscellaneous.

 

(a)     Section headings used in this Amendment are for convenience of reference
only, and shall not affect the construction of this Amendment.

 

(b)     This Amendment and any amendment hereof or supplement hereto or any
waiver granted in connection herewith may be executed in any number of
counterparts and by the different parties on separate counterparts and each such
counterpart shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same agreement. Delivery of an executed
facsimile shall be effective as delivery of an original counterpart.

 

(c)     This Amendment shall be a contract made under and governed by the
internal laws of the State of Florida, without giving effect to principles of
conflicts of laws.

 

(d)     All obligations of the Loan Parties and rights of the Lender, that are
expressed herein, shall be in addition to and not in limitation of those
provided by applicable law.

 

(e)     Whenever possible, each provision of this Amendment shall be interpreted
in such manner as to be effective and valid under applicable law; but if any
provision of this Amendment shall be prohibited by or invalid under applicable
law, such provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Amendment.

 

(f)     This Amendment shall be binding upon and inure to the benefit of the
Loan Parties, the Lender and their respective successors and assigns.

 

 

 
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9.     Waiver and Release. Each Loan Party hereby: (a) affirms that it is
indebted to the Lender under the terms and conditions of the Credit Agreement
and the other Loan Documents, each of which constitutes the valid and binding
obligation of the Loan Parties, enforceable in accordance with their respective
terms, and that no offsets, expenses or counterclaims to their respective
obligations thereunder exist; (b) affirmatively waives any right to challenge
the liens and security interests granted in favor of the Lender under the Credit
Agreement and the other Loan Documents or hereunder; and (c) further releases
the Lender from and affirmatively waives any and all claims, counterclaims, or
affirmative defenses it may have against the Lender as of and prior to the date
hereof.

  

 

 

 

 

[Remainder of Page Intentionally Blank]

 

 

 
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and
year first above written.

 

 

Lender:

 

 

 

FIFTH THIRD BANK,

 

an Ohio banking corporation

             

By:    /s/ Andrew D. Hahn                                           

    Andrew D. Hahn, Vice President

 

 

 

 

       

  

 

 

[Remainder of Page Intentionally Blank]

 

 

 
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Borrower:

 

 

 

SUPERIOR UNIFORM GROUP, INC.,

 

a Florida corporation

 

 

 

 

 

By:    /s/ Andrew D. Demott, Jr                                      

 

  Andrew D. Demott, Jr.,

 

   Executive Vice President, Chief Financial

   Officer and Treasurer

 

 

 

Fashion Seal:

     

FASHION SEAL CORPORATION,

a Nevada corporation

          By:    /s/ Andrew D. Demott, Jr                                       
    Andrew D. Demott, Jr.,

  President

     

TOG:

     

THE OFFICE GURUS, LLC,

a Florida limited liability company

 

By:  SUPERIOR UNIFORM GROUP, INC.,

        a Florida corporation, its Managing Member

          By: /s/ Andrew D. Demott, Jr                                      
Andrew D. Demott, Jr.,

   Executive Vice President, Chief

   Financial Officer and Treasurer

 

 

 

 

       

 

 

[Remainder of Page Intentionally Blank]

 

 
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Exhibit A to
First Amendment and Waiver to Second Amended And Restated Credit Agreement And
Other

 Loan Documents
Schedule 5.16(b) as of the Closing Date 

 

Schedule 5.16(b)

FOREIGN SUBSIDIARIES

 

Direct Subsidiaries of Borrower

Subsidiary Name

Entity Type

 

Jurisdiction of

Organization

Class of Securities

Number of

Shares/Units

 

SUG Holding

 

 

Cayman Island

exempted

company

 

Cayman Islands

 

Ordinary Shares

 

1

 

 

Direct Subsidiaries of Superior Office Solutions, Inc.

Subsidiary Name

Entity Type

 

Jurisdiction of

Organization

Class of Securities

Number of

Shares/Units

 

The Office Gurus,

LTDA

 

 

Limited liability

 

Costa Rica

 

Membership/

ownership

interests

 

100

 

Scratt Kit S.R.L.

 

 

 

Limited liability

 

Costa Rica

 

Membership/

ownership

interests

 

N/A - 100%

 

The Office

Masters, LTDA DE

C.V.

 

Limited liability

 

El Salvador

 

Membership/

ownership

interests

 

N/A – 99.9%

 

The Office Gurus,

LTDA DE C.V. 

 

 

Limited liability

 

El Salvador

 

Membership/

ownership

interests

 

N/A – 99.9%

 

 
7

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Exhibit A to
First Amendment and Waiver to Second Amended And Restated Credit Agreement And
Other

Loan Documents
Schedule 5.16(b) as of the Closing Date 

 

Indirect Subsidiaries of Loan Parties

 

Subsidiary

Name

 

Parent

Entity

Entity Type

Jurisdiction of

Organization

Class of

Securities

Number of

Shares/Units

 

The Office

Gurus, Ltd.

 

SUG

Holding

Limited liability

Belize

 

Membership/

ownership

interests

N/A – 99.9%

 

Superior

Sourcing

 

 

 

SUG

Holding

 

Cayman

Island

exempted

company

 

Cayman Islands

 

Ordinary

Shares

 

1

 

 
8

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 Exhibit B to

First Amendment and Waiver to Second Amended And Restated Credit Agreement And
Other

Loan Documents

Schedule 5.16(b) as of the First Amendment Effective Date

 

Schedule 5.16(b)

FOREIGN SUBSIDIARIES

 

Direct Subsidiaries of Borrower

 

Subsidiary Name

Entity Type

 

Jurisdiction of

Organization

Class of Securities

Number of

Shares/Units

 

SUG Holding

 

Cayman

Islands

exempted

company

 

Cayman Islands

 

Ordinary Shares

 

1.04

 

Indirect Subsidiaries of Loan Parties

 

Subsidiary

Name

 

Parent

Entity

Entity Type

Jurisdiction of

Organization

Class of

Securities

Number of

Shares/Units

 

The Office

Gurus, Ltd.

SUG

Holding

Limited liability

Belize

Membership/

ownership

interests

N/A – 99.9%

 

Superior

Sourcing

 

SUG

Holding

 

Cayman

Islands

exempted

company

 

Cayman Islands

 

Ordinary

Shares

 

1

 

Power Three

Web, LTDA

(f/k/a The Office

Gurus, LTDA)1

 

SUG

Holding

 

Limited liability

 

Costa Rica

 

Membership/

ownership

interests

 

100

 

The Office

Masters, LTDA

DE C.V.

 

SUG

Holding

 

Limited liability

 

El Salvador

 

Membership/

ownership

interests

 

N/A – 99.9%

 

The Office

Gurus, LTDA

DE C.V. 

 

SUG

Holding

 

Limited liability

 

El Salvador

 

Membership/

ownership

interests

 

N/A – 99.9%

 

 

 

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 1 Name change effective on or about October 14, 2013.  

 

 
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Exhibit C to
First Amendment and Waiver to Second Amended And Restated Credit Agreement And
Other

Loan Documents
Schedule IV to Security Agreement as of the Closing Date

 

SCHEDULE IV

 

 

LIST OF SUBSIDIARY CAPITAL STOCK

 

Superior Uniform Group, Inc. Subsidiary Ownership Interests

 

Issuer Name

Entity Type

Jurisdiction of

Organization

Class of

Securities

Number of

Shares/Units

Certificate

No.

Superior Office

Solutions, Inc.

Corporation

Nevada

Common Stock

100

1

Fashion Seal

Corporation

Corporation

Nevada

Common Stock

10,000

1

SUG Holding

Cayman

Islands

exempted

company

Cayman Islands

Ordinary

Shares

1

N/A

The Office

Gurus, LLC

Limited liability

company

Florida

Membership

interests

N/A - Sole

Member

N/A

 

 

Superior Office Solutions, Inc. Subsidiary Ownership Interests

Issuer Name

Entity Type

Jurisdiction of

Organization

Class of

Securities

Number of

Shares/Units

Certificate

No.

The Office

Gurus, LTDA

 

Limited liability

Costa Rica

Membership/

ownership

interests

100

No number.

Scratt Kit

S.R.L.

Limited liability

Costa Rica

Membership/

ownership

interests

N/A - 100%

N/A

The Office

Masters, LTDA

DE C.V.

Limited liability

El Salvador

Membership/

ownership

interests

N/A – 99.9%

N/A

The Office

Gurus, LTDA

DE C.V.

Limited liability

El Salvador

Membership/

ownership

interests

N/A – 99.9%

N/A

 

 
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Exhibit C to
First Amendment and Waiver to Second Amended And Restated Credit Agreement And
Other

Loan Documents
Schedule IV to Security Agreement as of the Closing Date

 

Fashion Seal Corporation Subsidiary Ownership Interests

Issuer Name

Entity Type

Jurisdiction of

Organization

Class of

Securities

Number of

Shares/Units

Certificate

No.

The Office

Masters, LTDA

DE C.V.

Limited liability

El Salvador

Membership/

ownership

interests

N/A – 0.1%

N/A

The Office

Gurus, LTDA

DE C.V.

Limited liability

El Salvador

Membership/

ownership

interests

N/A - 0.1%

N/A

The Office

Gurus, Ltd.

Limited liability

Belize

Membership/

ownership

interests

N/A - 0.1%

N/A

 

 

The Office Gurus, LLC – None

 

 
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Exhibit D to
First Amendment and Waiver to Second Amended And Restated Credit Agreement And
Other

Loan Documents
Schedule IV to Security Agreement as of the First Amendment Effective Date

  

SCHEDULE IV

 

 

LIST OF SUBSIDIARY CAPITAL STOCK

 

Superior Uniform Group, Inc. Subsidiary Ownership Interests

Issuer Name

Entity Type

Jurisdiction of

Organization

Class of

Securities

Number of

Shares/Units

Certificate

No.

Fashion Seal

Corporation

Corporation

Nevada

Common Stock

10,000

1

SUG Holding

Cayman

Islands

exempted

company

Cayman Islands

Ordinary

Shares

1.04

N/A

The Office

Gurus, LLC

Limited liability

company

Florida

Membership

interests

N/A - Sole

Member

N/A

 

 

Fashion Seal Corporation Subsidiary Ownership Interests

Issuer Name

Entity Type

Jurisdiction of

Organization

Class of

Securities

Number of

Shares/Units

Certificate

No.

The Office

Masters, LTDA

DE C.V.

Limited liability

El Salvador

Membership/

ownership

interests

N/A – 0.1%

N/A

The Office

Gurus, LTDA

DE C.V.

Limited liability

El Salvador

Membership/

ownership

interests

N/A - 0.1%

N/A

The Office

Gurus, Ltd.

Limited liability

Belize

Membership/

ownership

interests

N/A - 0.1%

N/A

 

 

The Office Gurus, LLC – None

 

 

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