EXHIBIT 10.33

 

HEWITT ASSOCIATES LLC

FIRST AMENDMENT TO THREE YEAR CREDIT AGREEMENT

 

This First Amendment to Three Year Credit Agreement (herein, the “Amendment”) is
entered into as of September 29, 2003, by and among Hewitt Associates LLC, an
Illinois limited liability company (the “Borrower”), the several financial
institutions listed on the signature pages hereof, as Lenders, and Harris Trust
and Savings Bank, as Administrative Agent (the “Administrative Agent”) for the
Lenders.

 

PRELIMINARY STATEMENTS

 

A. The Borrower, the Lenders and the Administrative Agent are parties to a Three
Year Credit Agreement dated as of September 27, 2002 (the “Credit Agreement”).
All capitalized terms used herein without definition shall have the same
meanings herein as such terms have in the Credit Agreement.

 

B. The Borrower has requested that the Lenders replace the Tangible Net Worth
Covenant with a Total Debt to Total Capitalization Covenant, change certain
financial reporting requirements and make certain other changes to the Credit
Agreement, and the Lenders are willing to do so under the terms and conditions
set forth in this Amendment.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:

 

SECTION 1. AMENDMENTS.

 

Subject to the satisfaction of the conditions precedent set forth in Section 2
below, the Credit Agreement shall be and hereby is amended as follows:

 

1.1. The definition of “Applicable Margin” set forth in Section 4.1 of the
Credit Agreement shall be amended by deleting the paragraph immediately
following the pricing table set forth therein and replacing it with a new
paragraph, to read in its entirety as follows:

 

For purposes hereof, the term “Pricing Date” means, for any fiscal quarter of
the Borrower ending on or after September 30, 2002, the date on which the
Administrative Agent is in receipt of the Borrower’s most recent financial
statements (and, in the case of the year-end financial statements, audit report
of the Borrower or HAI, as required under Section 7.5 hereof) for the fiscal
quarter then ended, pursuant to Section 7.5 hereof. The Applicable Margin shall
be established based on the Leverage Ratio for the most recently completed
fiscal quarter and the Applicable Margin established on a Pricing Date shall
remain in effect until the next

 

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Pricing Date. If the Borrower has not delivered its financial statements by the
date such financial statements (and, in the case of the year-end financial
statements, audit report of the Borrower or HAI, as required under Section 7.5
hereof) are required to be delivered under Section 7.5 hereof, until such
financial statements and audit report are delivered, the Applicable Margin shall
be the highest Applicable Margin (i.e., the Leverage Ratio shall be deemed to be
greater than 1.50 to 1.0). If the Borrower subsequently delivers such financial
statements before the next Pricing Date, the Applicable Margin established by
such late delivered financial statements shall take effect from the date of
delivery until the next Pricing Date. In all other circumstances, the Applicable
Margin established by such financial statements shall be in effect from the
Pricing Date that occurs immediately after the end of the fiscal quarter covered
by such financial statements until the next Pricing Date. Each determination of
the Applicable Margin made by the Administrative Agent in accordance with the
foregoing shall be conclusive and binding on the Borrower and the Lenders if
reasonably determined.

 

1.2. Section 4.1 of the Credit Agreement shall be amended by adding the
following new defined terms thereto, each in its appropriate place in the
alphabetical sequence, each to read in its entirety as follows:

 

“Other Senior Debt” means, collectively, the following:

 

Hewitt Properties I LLC-$75,000,000-Secured Credit Tenant Notes due October 30,
2018;

 

Hewitt Properties II LLC-$45,000,000-6.73% Secured Credit Tenant Notes due
November 30, 2019;

 

Hewitt Properties III LLC-$40,000,000, 6.89% Secured Credit Tenant Notes due
April 27, 2014;

 

Hewitt Properties IV LLC-$85,000,000-7.13% Secured Credit Tenant Notes due
February 27, 2020;

 

Hewitt Associates LLC-$50,000,000 Senior Notes due May 30, 2008;

 

Hewitt Associates LLC-$15,000,000 7.94% Senior Notes, Series A, Tranche 1 due
March 30, 2007; $35,000,000-8.08% Senior Notes, Series A, Tranche 2 due March
30, 2012;

 

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Hewitt Associates LLC $10,000,000 8.11% Senior Notes, Series B, due June 30,
2010;

 

Hewitt Associates LLC $15,000,000 7.93% Senior Notes, Series C, due June 30,
2007;

 

Hewitt Associates LLC $10,000,000 7.65% Senior Notes, Series D due October 15,
2005; and

 

Hewitt Associates LLC $15,000,000 7.90% Senior Notes, Series E due October 15,
2010.

 

“Total Capitalization” means, at any time the same is to be determined, the sum
of Total Debt at such time plus Net Worth at such time.

 

1.3. Section 7.4 of the Credit Agreement is amended by deleting the reference to
“$25,000,000” set forth therein and replacing it with “$100,000,000”.

 

1.4. Section 7.5(b) of the Credit Agreement shall be amended and restated to
read in its entirety as follows:

 

(b)(i) as soon as available, and in any event within ninety (90) days after the
close of the annual accounting period ending on September 30, 2003 and each
annual accounting period thereafter for which such audit report is provided to
the holders of any of the Borrower’s Other Senior Debt, a copy of the annual
audit report for the Borrower and its Subsidiaries as of the close of such
period with accompanying financial statements (including consolidated balance
sheet and profit and loss and cash flow statements of the Borrower and its
Subsidiaries for such period), and accompanying notes thereto, each in
reasonable detail showing in comparative form the figures for the previous
fiscal year, accompanied by an unqualified opinion thereon of Ernst & Young LLP
or another firm of independent public accountants of recognized national
standing, selected by the Borrower and satisfactory to the Required Lenders, to
the effect that the financial statements have been prepared in accordance with
GAAP and present fairly in accordance with GAAP the consolidated financial
condition of the Borrower and its Subsidiaries as of the close of such fiscal
year and the results of their operations and cash flows for the fiscal year then
ended and that an examination of such accounts in connection with such financial
statements has been made in accordance with generally accepted auditing
standards and, accordingly, such examination included such tests of the
accounting records and such other auditing procedures as were considered
necessary in the circumstances; or

 

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(b)(ii) for any fiscal year with respect to which audited financial statements
of the Borrower and its Subsidiaries are not being provided to the Lenders
pursuant to the immediately foregoing clause (b)(i), as soon as available, and
in any event within ninety (90) days after the close of each annual accounting
period of HAI, a copy of the annual audit report for HAI and its Subsidiaries as
of the close of such period with accompanying financial statements (including
consolidated balance sheet and profit and loss and cash flow statements of HAI
and its Subsidiaries for such period), and accompanying notes thereto, together
with unaudited consolidating financial statements of HAI and its Subsidiaries
for such period, each in reasonable detail showing in comparative form the
figures for the previous fiscal year, accompanied by, in the case of the audited
financial statements, an unqualified opinion thereon of Ernst & Young LLP or
another firm of independent public accountants of recognized national standing,
selected by HAI and satisfactory to the Required Lenders, to the effect that the
audited financial statements have been prepared in accordance with GAAP and
present fairly in accordance with GAAP the consolidated financial condition of
HAI and its Subsidiaries as of the close of such fiscal year and the results of
their operations and cash flows for the fiscal year then ended and that an
examination of such accounts in connection with such financial statements has
been made in accordance with generally accepted auditing standards and,
accordingly, such examination included such tests of the accounting records and
such other auditing procedures as were considered necessary in the
circumstances; and

 

(b)(iii) for any fiscal year with respect to which audited financial statements
of the Borrower and its Subsidiaries are not being provided to the Lenders
pursuant to the foregoing clause (b)(i), as soon as available, and in any event
within ninety (90) days after the close of each annual accounting period of
Lincolnshire Insurance Company PPC Ltd. (“Lincolnshire Insurance”), a copy of
the annual audit report for Lincolnshire Insurance as of the close of such
period with accompanying financial statements (including balance sheet and
profit and loss and cash flow statements of Lincolnshire Insurance for such
period), and accompanying notes thereto, each in reasonable detail showing in
comparative form the figures for the previous fiscal year, accompanied by an
unqualified opinion thereon of Ernst & Young LLP or another firm of independent
public accountants of

 

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recognized national standing, selected by Lincolnshire Insurance and
satisfactory to the Required Lenders, to the effect that the financial
statements have been prepared in accordance with GAAP and present fairly in
accordance with GAAP the financial condition of the Lincolnshire Insurance as of
the close of such fiscal year and the results of its operations and cash flows
for the fiscal year then ended and that an examination of such accounts in
connection with such financial statements has been made in accordance with
generally accepted auditing standards and, accordingly, such examination
included such tests of the accounting records and such other auditing procedures
as were considered necessary in the circumstances; and

 

1.5. Section 7.8 of the Credit Agreement shall be amended and restated to read
in its entirety as follows:

 

Section 7.8. Total Debt to Total Capitalization Ratio. The Borrower will not at
any time permit the ratio of Total Debt to Total Capitalization to exceed 0.45
to 1.0.

 

1.6. Section 7.20 of the Credit Agreement shall be amended by and restated to
read in its entirety as follows:

 

Section 7.20. No Changes in Fiscal Year. The Borrower shall not, nor shall it
permit HAI or any Subsidiary to, change its fiscal year from its present basis
without the prior written consent of the Required Lenders, except that each of
HAI and the Borrower may change its fiscal year end to December 31 provided
that, prior to such change becoming effective, the Borrower and the Required
Lenders have entered into an amendment to the provisions of this Agreement with
respect to the effects of such change on the provisions hereof.

 

1.7. Schedule I to Exhibit E of the Credit Agreement shall be amended and
restated in its entirety in the form of Exhibit A hereto.

 

SECTION 2. CONDITIONS PRECEDENT.

 

The effectiveness of this Amendment is subject to the satisfaction of all of the
following conditions precedent:

 

2.1. The Borrower, the Administrative Agent and the Required Lenders shall have
executed and delivered this Amendment.

 

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2.2. The Borrower shall have paid all reasonable accrued and unpaid legal fees,
expenses and disbursements of Chapman and Cutler, counsel to the Administrative
Agent, incurred in connection with the Credit Agreement or this Amendment.

 

2.3. The Borrower shall have executed and delivered new Revolving Notes to those
Lenders which are increasing their Revolving Credit Commitments as described in
Section 4 hereof.

 

2.4. The Borrower shall have paid to the Administrative Agent, for the benefit
of each Lender executing this Amendment, an amendment fee of 0.10% on the amount
of such Lender’s Revolving Credit Commitment after giving effect to the
Revolving Credit Commitment increase described in Section 4 hereof.

 

2.5. The Borrower shall have paid the Commitment Increase Fees.

 

SECTION 3. REPRESENTATIONS.

 

In order to induce the Lenders to execute and deliver this Amendment, the
Borrower hereby represents to the Lenders that as of the date hereof the
representations and warranties set forth in Section 5 of the Credit Agreement as
amended hereby are and shall be and remain true and correct and the Borrower is
in compliance with the terms and conditions of the Credit Agreement and no
Default or Event of Default has occurred and is continuing under the Credit
Agreement or shall result after giving effect to this Amendment.

 

SECTION 4. REVOLVING CREDIT COMMITMENT INCREASE.

 

Prior to the date hereof, the Borrower has proposed to increase the Revolving
Credit Commitments to an aggregate amount of $75,000,000 pursuant to the
provisions of Section 1.15 of the Credit Agreement. Certain of the Lenders have,
pursuant to the provisions of said Section 1.15, elected to increase their
respective Revolving Credit Commitments such that the Revolving Credit
Commitments of the Lenders effective from and after the date hereof shall be:

 

Harris Trust and Savings Bank

   $ 21,875,000.00

Bank of America, N.A.

   $ 21,875,000.00

Wells Fargo Bank, National Association

   $ 15,625,000.00

Wachovia Bank, N.A.

   $ 15,625,000.00

 

In connection with such increase, the Borrower shall on the date hereof pay each
Lender increasing its Revolving Credit Commitment a fee of 0.10% on the amount
of such increase (the “Commitment Increase Fee”).

 

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SECTION 5. MISCELLANEOUS.

 

5.1. Except as specifically amended herein, the Credit Agreement shall continue
in full force and effect in accordance with its original terms. Reference to
this specific Amendment need not be made in the Credit Agreement, the Notes, or
any other instrument or document executed in connection therewith, or in any
certificate, letter or communication issued or made pursuant to or with respect
to the Credit Agreement, any reference in any of such items to the Credit
Agreement being sufficient to refer to the Credit Agreement as amended hereby.

 

5.2. The Borrower agrees to pay on demand all reasonable third party costs and
expenses incurred by the Administrative Agent in connection with the
negotiation, preparation, execution and delivery of this Amendment, including
the reasonable fees and expenses of counsel for the Administrative Agent.

 

5.3. This Amendment may be executed in any number of counterparts, and by the
different parties on different counterpart signature pages, all of which taken
together shall constitute one and the same agreement. Any of the parties hereto
may execute this Amendment by signing any such counterpart and each of such
counterparts shall for all purposes be deemed to be an original. This Amendment
shall be governed by the internal laws of the State of Illinois.

 

[SIGNATURE PAGE TO FOLLOW]

 

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This First Amendment and Waiver to Credit Agreement is entered into as of this
29th day of September, 2003.

 

BORROWER HEWITT ASSOCIATES LLC By:   /s/    JOHN M. RYAN          

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Name:

  John M. Ryan

Title:

  Chief Administrative Officer

 

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“Lenders”

HARRIS TRUST AND SAVINGS BANK, in its
individual capacity as a Lender, and as
Administrative Agent

By:   /s/    JOANN L. HOLMAN          

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Name:

  Joann L. Holman

Title:

  Vice President

 

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BANK OF AMERICA, N.A. By:   /s/    ROBERT MAURIELLO          

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Name:

  Robert Mauriello

Title:

  Principal

 

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WELLS FARGO BANK, NATIONAL ASSOCIATION

By:   /s/    ANDREW T. CAVALLARI          

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Name:

  Andrew T. Cavallari

Title:

  Vice President

 

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WACHOVIA BANK, N.A.

By:   /s/    DANIEL L. EVANS          

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Name:

  Daniel L. Evans

Title:

  Managing Director

 

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EXHIBIT A

 

SCHEDULE I

TO COMPLIANCE CERTIFICATE

 

HEWITT ASSOCIATES LLC

 

COMPLIANCE CALCULATIONS

FOR CREDIT AGREEMENT DATED AS OF SEPTEMBER 27, 2002

 

CALCULATIONS AS OF                     ,                     

 

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A.

 

Interest Coverage Ratio (Section 7.7)

          

1.

 

Net Income for past 4 quarters

   $ ___________    

2.

 

Interest Expense for past 4 quarters

   $ ___________    

3.

 

Income taxes for past 4 quarters

   $ ___________    

4.

 

Depreciation and Amortization Expense for past 4 quarters

   $ ___________    

5.

 

Sum of lines A1, A2, A3, and A4

   $ ___________    

6.

 

Gains on sales of assets in past 4 quarters

   $ ___________    

7.

 

Difference of Line A5 minus Line A6 (“EBITDA”)

   $ ___________    

8.

 

Rental Expense for past 4 quarters

   $ ___________    

9.

 

Sum of Lines A7 and A8

   $ ___________    

10.

 

Interest Expense for past 4 quarters

   $ ___________    

11.

 

Sum of Lines A8 and A10

   $ ___________    

12.

 

Ratio of Line A9 to Line A11

     ___:1.0    

13.

 

Line A12 ratio must not be less than

     2.0:1.0    

14.

 

The Borrower is in compliance (circle yes or no)

     yes/no

B.

 

Total Debt to Total Capitalization Ratio (Section 7.8)

          

1.

 

Total Debt

   $ ___________    

2.

 

Net Worth

   $ ___________    

3.

 

Sum of Lines B1 and B2 (“Total Capitalization”)

   $ ___________

 

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4.

 

Ratio of Line B1 to B3 (“Total Debt to Total Capitalization Ratio”)

     ___: 1.0    

5.

 

The Borrower is in compliance (circle yes or no)

     yes/no

C.

 

Leverage Ratio (Section 7.9)

          

1.

 

Total Debt

   $ ___________    

2.

 

Net income for past 4 quarters

   $ ___________    

3.

 

Interest Expense for past 4 quarters

   $ ___________    

4.

 

Income taxes for past 4 quarters

   $ ___________    

5.

 

Depreciation and Amortization Expense for past 4 quarters

   $ ___________    

6.

 

Sum of lines C2, C3, C4 and C5

   $ ___________    

7.

 

Gains on sales of assets in past 4 quarters

   $ ___________    

8.

 

Difference of Line C6 minus Line C7 (“EBITDA”)

   $ ___________    

9.

 

Ratio of Line C1 to Line C8

     ___:1.0    

10.

 

Line C9 ratio must not exceed

     2.25:1.0    

11.

 

The Borrower is in compliance (circle yes or no)

     yes/no

 

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