Document:

EX=10.1

 

EXHIBIT 10.1

SECOND AMENDMENT TO CREDIT AGREEMENT

     THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this “Amendment”), dated as of May 30,
2006, is by and among ENTERTAINMENT DISTRIBUTION COMPANY, LLC, a Delaware limited liability company
(the “Borrower”), those Domestic Subsidiaries of the Borrower identified as a “Guarantor”
on the signature pages hereto (individually a “Guarantor” and collectively the
“Guarantors”), the financial institutions party hereto as lenders (the “Lenders”)
and WACHOVIA BANK, NATIONAL ASSOCIATION, as administrative agent under the Credit Agreement
(defined below) (in such capacity, the “Administrative Agent”).

W I T N E S S E T H

     WHEREAS, the Borrower, the Guarantors, Glenayre Electronics, Inc., a Colorado corporation, the
Lenders and the Administrative Agent are parties to that certain Credit Agreement dated as of May
31, 2005 (as previously amended, modified or supplemented and as further amended, modified,
supplemented, restated or amended and restated from time to time, the “Credit Agreement”;
capitalized terms used herein shall have the meanings ascribed thereto in the Credit Agreement as
amended hereby); and

     WHEREAS, the Borrower and the Lenders have agreed to amend the Credit Agreement on the terms
and conditions set forth herein;

     NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other good
and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties
hereto agree as follows:

ARTICLE I

AMENDMENT TO CREDIT AGREEMENT

     1.1 Amendment to Section 1.1. Section 1.1 of the Credit Agreement is hereby amended
as follows:

     (a) The definition of “Consolidated Capital Expenditures” is hereby deleted in its
entirety and replaced with the following:

     “Consolidated Capital Expenditures” shall mean, for any period, all
capital expenditures of the Credit Parties and their Subsidiaries on a Consolidated
basis for such period, as determined in accordance with GAAP. The term
“Consolidated Capital Expenditures” shall not include capital expenditures in
respect of the reinvestment of proceeds derived from Recovery Events received by the
Credit Parties and their Subsidiaries to the extent that such reinvestment is
permitted under the Credit Documents, and, for each of the fiscal years 2006, 2007
and 2008, shall not include the Annual SJB Capital Expenditures.

 

 

     (b) The definition of “Consolidated EBITDA” is hereby deleted in its entirety and
replaced with the following:

     “Consolidated EBITDA” shall mean, for any period, the sum of (a)
Consolidated Net Income for such period, plus (b) an amount which, in the
determination of Consolidated Net Income for such period, has been deducted for (i)
Consolidated Interest Expense, (ii) total federal, state, local and foreign income
taxes, (iii) depreciation and amortization expense, and (iv) any non-cash expenses
in an aggregate amount not to exceed $700,000 during fiscal year 2006 and $1,000,000
in each other fiscal year during the term of this Agreement resulting from the
recognition of non-cash expenses resulting from any stock option, restricted stock
grant or profit interest award granted to key employees, all as determined in
accordance with GAAP (except for the exclusion of Rebate Payments). Notwithstanding
the foregoing, Consolidated EBITDA for the fiscal quarters ended June 30, 2004,
September 30, 2004, December 31, 2004 and March 31, 2005 shall be the respective
amounts set forth on Schedule 1.1-4 attached hereto.

     (c) The last sentence of the definition of “Funded Debt” is hereby deleted in its
entirety and replaced with the following:

     Notwithstanding the foregoing, (i) the Rebate Payments (subject to the
following sentence), including any portion thereof characterized as interest, shall
be included in the calculation of Funded Debt and (ii) to the extent that funds have
been set aside in a Pension and Employee Loans Escrow Fund or they are otherwise
cash collateralized, employee loan obligations and pension obligations shall not be
included in the calculation of Funded Debt. For the purposes of determining
compliance with Section 5.9 for the fiscal quarters ending March 31, 2006, June 30,
2006, September 30, 2006 and December 31, 2006, the Rebate Payment made on December
31, 2005 totaling $5,507,670 shall not be included in the calculation of Funded
Debt.

     (d) The definition of “Revolving Commitment Termination Date” is hereby deleted in its
entirety and replaced with the following:

     “Revolving Commitment Termination Date” shall mean May 31, 2007.

     (e) The definition of “Term Loan Maturity Date” is hereby deleted in its entirety and
replaced with the following:

     “Term Loan Maturity Date” shall mean December 31, 2010.

     (f) The following definitions are hereby added in appropriate alphabetical order:

2

 

     “SJB Project” shall mean the capital expenditure project involving the
assembly, manufacturing and packaging of “Super Jewel Boxes” for the Sellers, as set
forth in the agreement between Borrower and certain of the Sellers dated January 30,
2006.

     “Annual SJB Capital Expenditure” shall mean $1,220,730 (equal to
one-third of the total capital expenditures associated with the SJB Project of
$3,662,190).

     “Second Amendment” shall mean that certain Second Amendment to Credit
Agreement dated as of the Second Amendment Effective Date by and among the Borrower,
the Guarantors party thereto, the Administrative Agent and the Lenders party
thereto.

     “Second Amendment Effective Date” shall mean June 21, 2006.

     1.2 Amendment to Section 1.3. Section 1.3 of the Credit Agreement is hereby amended
by adding the following paragraph at the end thereof:

     The parties hereto acknowledge and agree that, for purposes of all calculations made in
determining compliance for any applicable period with the financial covenants set forth in
Section 5.9 (including without limitation for purposes of the definition of “Pro Forma
Basis” set forth in Section 1.1), after consummation of the Acquisition (as defined in the
Second Amendment), (A) income statement items and other balance sheet items (whether
positive or negative) attributable to the Target (as defined in the Second Amendment) shall
be included in such calculations to the extent relating to such applicable period, and (B)
Indebtedness of such Target which is retired in connection with such Acquisition shall be
excluded from such calculations and deemed to have been retired as of the first day of such
applicable period.

     1.3 Amendment to Section 2.2(b). Section 2.2(b) of the Credit Agreement is hereby
deleted in its entirety and replaced with the following:

     (b) Repayment of Term Loan. The principal amount of the Term Loan shall be
repaid in six (6) installments as follows:

	 	 	 	 	 	 
	 
	 	Payment Date	 	 	Term Loan Principal	 
	 	Principal Amortization	 	 	Amortization Payment	 
	 	December 31, 2005
	 	 	$5,000,000	 
	 	December 31, 2006
	 	 	$6,500,000	 
	 	December 31, 2007
	 	 	$8,000,000	 
	 	December 31, 2008
	 	 	$9,000,000	 
	 	December 31, 2009
	 	 	$9,000,000	 
	 	Term Loan Maturity Date
	 	 	$9,000,000	 
	 

3

 

     1.4 Amendment to Section 2.7(b)(v). Section 2.7(b)(iv) of the Credit Agreement is
hereby deleted in its entirety and replaced with the following:

     Excess Cash Flow. Within seventy-five (75) days after the end of each
fiscal quarter ending December 31, commencing with the fiscal quarter ending
December 31, 2006, the Borrower shall prepay the Loans and cash collateralize the
LOC Obligations in an amount equal to 75% of the Excess Cash Flow earned during the
twelve-month period then ended (such prepayments to be applied as set forth in
clause (vi) below); provided, that if the Leverage Ratio is less than or
equal to 1.50 to 1.0 as of the end of any fiscal year as demonstrated by the
officer’s Compliance Certificate most recently delivered pursuant to Section 5.2(b),
the Borrower shall not be required to prepay the Loans and/or cash collateralize the
LOC Obligations on account of the Excess Cash Flow earned during such prior fiscal
year.

     1.5 Amendment to Section 5.1(b). Section 5.1(b) of the Credit Agreement is hereby
deleted in its entirety and replaced with the following:

     Quarterly Financial Statements. As soon as available and in any event
within sixty (60) days after the end of each of the first three fiscal quarters of
the Borrower, a company-prepared Consolidated and consolidating balance sheet of the
Borrower and its consolidated Subsidiaries as at the end of such period and related
company-prepared Consolidated and consolidating statements of income and retained
earnings and of cash flows for the Borrower and its consolidated Subsidiaries for
such quarterly period and for the portion of the fiscal year ending with such
period, in each case setting forth in comparative form the figures for the
corresponding period or periods of the preceding fiscal year and the annual budget
plan delivered in accordance with Section 5.1(d) below (subject to normal recurring
year-end audit adjustments); and

     1.6 Amendment to Section 5.9(a). Section 5.9(a) of the Credit Agreement is hereby
deleted in its entirety and replaced with the following:

     (a) Leverage Ratio. The Leverage Ratio, as of the last day of each fiscal
quarter of the Borrower occurring during the periods indicated below, shall be less than or
equal to the following:

4

 

	 	 	 	 	 	 	 	 
	 
	 	Fiscal Quarter Ending	 	 	Required Ratio	 	 
	 	September 30, 2005
	 	 	 	3.30 to 1.00	 	 
	 	December 31, 2005
	 	 	 	2.85 to 1.00	 	 
	 	March 31, 2006
	 	 	 	2.75 to 1.00	 	 
	 	June 30, 2006 and September 30, 2006
	 	 	 	2.50 to 1.00	 	 
	 	December 31, 2006 and thereafter
	 	 	 	2.00 to 1.00	 	 
	 

     1.7 Amendment to Section 5.9(b). Section 5.9(b) of the Credit Agreement is hereby
deleted in its entirety and replaced with the following:

     (b) Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio, as of the
last day of each fiscal quarter of the Borrower occurring during the periods indicated
below, shall be greater than or equal to the following:

	 	 	 	 	 	 	 	 
	 
	 	Fiscal Quarter Ending	 	 	Required Ratio	 	 
	 	September 30, 2005 through March 31, 2006
	 	 	 	1.10 to 1.00	 	 
	 	Thereafter
	 	 	 	1.25 to 1.00	 	 
	 

     1.8 Amendment to Section 5.12(b). Section 5.12(b) is hereby deleted in its entirety
and replaced with the following:

     (b) Each Credit Party shall cause the Cash Collateral to be pledged to the
Administrative Agent for the benefit of the Lenders from the Closing date until the Second
Amendment Effective Date.

     1.9 Release of Cash Collateral. For the avoidance of doubt, pursuant to the
provisions of Sections 4(c)(ii) and 2(c)(iii) of the Cash Collateral Agreement and the amendment to
Section 5.12(b) of the Credit Agreement set forth above, the Cash Collateral is hereby released
upon the Second Amendment Effective Date.

ARTICLE II

CONDITIONS TO EFFECTIVENESS

     2.1 Closing Conditions.

     This Amendment shall become effective as of the date hereof (the “Second Amendment
Effective Date”) upon satisfaction of the following conditions (in form and substance
reasonably acceptable to the Administrative Agent):

5

 

     (a) Executed Amendment. The Administrative Agent shall have received a copy of
this Amendment duly executed by each of the Credit Parties, the Lenders and the
Administrative Agent.

     (b) Dutch Pledge Documents. The Administrative Agent shall have received
copies of each document reasonably requested by the Administrative Agent to effectuate the
pledge by the Company of 65% of its ownership interest in the Dutch Holding Company,
including, without limitation, a Dutch law governed pledge agreement and a legal opinion of
counsel to the Borrower and the Dutch Holding Company covering, among other things,
corporate and perfection matters, in each case, in form and substance reasonably
satisfactory to the Administrative Agent.

     (c) Jewel Box Documents. The Administrative Agent shall have received a copy
of the documentation evidencing the SJB Project including, without limitation, any document
evidencing Seller’s obligation to reimburse the Borrower no later than the third anniversary
from the date the equipment that is the subject of the SJB Project becomes operational,
which is currently expected to occur in the third quarter of 2006, certified by an officer
of the Borrower as true, correct and complete.

     (d) Amendment Fee. The Borrower shall have paid or caused to be paid an
additional amendment fee to the Administrative Agent in connection with this Amendment for
the account of each Lender that shall have returned executed signature pages to this
Amendment no later than 5:00 p.m. on Wednesday, June 21, 2006, as directed by the Agent, in
an aggregate amount equal to $83,000 to be allocated among the Lenders pro rata according to
their Commitment Percentage.

     (e) Other. The Administrative Agent shall have received such other documents,
agreements or information which it may reasonably request relating to the Credit Parties and
the transactions contemplated by this Amendment and any other matters relevant hereto or
thereto, all in form and substance satisfactory to the Administrative Agent in its sole good
faith discretion.

ARTICLE III

MISCELLANEOUS

     3.1 Amended Terms. All references to the Credit Agreement in each of the Credit
Documents shall hereafter mean the Credit Agreement as amended by this Amendment. Except as
specifically amended hereby or otherwise agreed, the Credit Agreement is hereby ratified and
confirmed and shall remain in full force and effect according to its terms.

6

 

     3.2 Representations and Warranties of Credit Parties. Each of the Credit Parties
represents and warrants as follows as of the date hereof:

     (a) It has taken all necessary action to authorize the execution, delivery and
performance of this Amendment.

     (b) This Amendment has been duly executed and delivered by such Person and constitutes
such Person’s valid and legally binding obligations, enforceable in accordance with its
terms, except as such enforceability may be subject to (i) bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or similar laws affecting
creditors’ rights generally and (ii) general principles of equity (regardless of whether
such enforceability is considered in a proceeding at law or in equity).

     (c) No consent, approval, authorization or order of, or filing, registration or
qualification with, any Governmental Authority or third party is required in connection with
the execution, delivery or performance by such Person of this Amendment.

     (d) The representations and warranties set forth in Article III of the Credit Agreement
are true and correct in all material respects as of the date hereof (except for those which
expressly relate to an earlier date).

     3.3 Acknowledgment of Guarantors. The Guarantors acknowledge and consent to all of
the terms and conditions of this Amendment and agree that this Amendment and all documents executed
in connection herewith do not operate to reduce or discharge the Guarantors’ obligations under the
Credit Documents.

     3.4 Credit Document. This Amendment shall constitute a Credit Document under the
terms of the Credit Agreement.

     3.5 Entirety. This Amendment and the other Credit Documents embody the entire
agreement between the parties hereto and supersede all prior agreements and understandings, oral or
written, if any, relating to the subject matter hereof.

     3.6 Counterparts; Telecopy. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. Delivery of an executed counterpart to this
Amendment by telecopy shall be effective as an original and shall constitute a representation that
an original will be delivered.

     3.7 GOVERNING LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER
THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF
THE STATE OF NEW YORK.

7

 

     3.8 Consent to Jurisdiction; Service of Process; Waiver of Jury Trial. The
jurisdiction, services of process and waiver of jury trial provisions set forth in Sections 9.14
and 9.17 of the Credit Agreement are hereby incorporated by reference, mutatis mutandis.

     3.9 Fees. The Borrower agrees to pay all fees and expenses of the Administrative
Agent in connection with the preparation, execution and delivery of this Amendment, including,
without limitation, the fees and expenses of Moore & Van Allen PLLC.

[remainder of page intentionally left blank]

8

 

     IN WITNESS WHEREOF the Borrower, the Guarantors, the Lenders, and the Administrative Agent
have caused this Amendment to be duly executed on the date first above written.

	 	 	 	 	 
	BORROWER:

	 	ENTERTAINMENT DISTRIBUTION COMPANY, LLC,
	 

	 	a Delaware limited liability company
	 
	 	 	 	 
	 

	 	By:	 	/s/ Debra Ziola
	 

	 	 	 	 
	 

	 	Name:	 	Debra Ziola 
	 

	 	Title:	 	Chief Financial Officer
	 
	 	 	 	 
	GUARANTORS:

	 	ENTERTAINMENT DISTRIBUTION COMPANY (USA), LLC,
	 

	 	a Delaware limited liability company
	 
	 	 	 	 
	 

	 	By:	 	/s/ Debra Ziola 
	 

	 	 	 	 
	 

	 	Name:	 	Debra Ziola 
	 

	 	Title:	 	Chief Financial Officer 

 

 

	 	 	 	 	 
	ADMINISTRATIVE AGENT AND LENDERS

	 	WACHOVIA BANK,

NATIONAL ASSOCIATION,

as Administrative Agent and as a Lender
	 
	 	 	 	 
	 

	 	By:	 	/s/ Samantha Wright Jones 
	 

	 	 	 	 
	 

	 	Name:	 	Samantha Wright Jones 
	 

	 	Title:	 	Vice President 
	 
	 	 	 	 
	 

	 	ING CAPITAL LLC, as a Lender
	 
	 	 	 	 
	 

	 	By:	 	/s/ Andrew T. Layton 
	 

	 	 	 	 
	 

	 	Name:	 	Andrew T. Layton 
	 

	 	Title:	 	Vice President<PAGE>

                                                                    EXHIBIT 10.1

                               AMENDMENT NO. 1 TO
                   FIRST AMENDED AND RESTATED CREDIT AGREEMENT

          THIS AMENDMENT NO. 1 TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT
dated as of June 16, 2006 (this "Amendment") among CRAWFORD & COMPANY, a Georgia
corporation ("Crawford") and CRAWFORD & COMPANY INTERNATIONAL, INC., a Georgia
corporation ("International"; International and Crawford are collectively
referred to herein as the "Borrowers", and each individually as, a "Borrower"),
the LENDERS party hereto (the "Lenders") and SUNTRUST BANK ("SunTrust"), as
administrative agent for the Lenders (in such capacity, together with its
successors in such capacity, the "Administrative Agent").

                                   WITNESSETH:

          WHEREAS, the Borrowers, the Lenders and SunTrust, as Administrative
Agent, are parties to that certain First Amended and Restated Credit Agreement
dated as of September 30, 2005 (as in effect immediately prior to the
effectiveness of this Amendment, the "Credit Agreement");

          WHEREAS, the Borrowers have requested certain amendments to the Credit
Agreement as more fully described herein, and the Lenders are willing to agree
to such amendments on the terms and conditions set forth below;

          NOW, THEREFORE, the parties hereto hereby agree that, effective as of
the Effective Date (as defined in Section 4 hereof), the Credit Agreement shall
be amended as follows:

          Section 1. Definitions. All capitalized terms used herein and not
otherwise defined herein shall have the meanings given such terms as set forth
in the Credit Agreement.

          Section 2. Amendments. Effective as of the Effective Date:

          (a) Section 1.1 of the Credit Agreement shall be amended by adding the
following sentence at the end of the defined term "INDEBTEDNESS":

     "Notwithstanding the foregoing, the Permitted Sale/Leaseback Transaction
     shall be excluded from 'sale and leaseback transactions' in clause (x) of
     the definition of Indebtedness; provided, however, if the lease obligations
     under the Permitted Sale/Leaseback Transaction would otherwise be included
     in the definition of Indebtedness, such lease obligations shall not be
     excluded from the definition of Indebtedness."

          (b) Section 1.1 of the Credit Agreement shall be amended by deleting
the defined term "PERMITTED SALE/LEASEBACK TRANSACTION" therein and substituting
in lieu thereof the following definition:

<PAGE>

               "PERMITTED SALE/LEASEBACK TRANSACTION" shall mean a transaction
     to be entered into by Crawford after the Closing Date pursuant to which
     Crawford will sell its corporate headquarters located at 5620 Glenridge
     Drive, Atlanta, Georgia, and contemporaneously lease property to be used as
     Crawford's corporate headquarters; provided, that (i) such sale/leaseback
     transaction is consummated no later than September 30, 2006; (ii) Crawford
     receives gross cash proceeds of not less than $8,000,000 in connection with
     such sale, (iii) no Default or Event of Default exists immediately prior to
     such sale/leaseback transaction or will result after giving effect to such
     sale/leaseback transaction and (iv) the terms and conditions of the lease
     of such property are reasonably acceptable to the Administrative Agent.

          (c) Section 7.6 of the Credit Agreement shall be amended by deleting
clause (c) thereof and substituting in lieu thereof the following:

               "(c) the sale or other disposition of the real property and
     improvements currently comprising Crawford's corporate headquarters at 5620
     Glenridge Drive, Atlanta, Georgia, but only if (i) prior to the
     consummation of such sale or disposition (x) replacement offices have been
     leased or purchased and (y) Crawford has given the Administrative Agent
     written notice of its new address in accordance with Section 10.1, (ii)
     such sale or disposition is consummated no later than September 30, 2006;
     (iii) Crawford receives gross cash proceeds of not less than $8,000,000 in
     connection with such sale or disposition and (iii) no Default or Event of
     Default exists immediately prior to such sale or disposition or will result
     after giving effect to such sale or disposition; and"

          Section 3. Representations and Warranties. The Borrowers hereby
represent and warrant to the Lenders and the Administrative Agent that as of the
Effective Date:

          (a) the representations and warranties set forth in Article IV of the
     Credit Agreement are true and correct in all material respects as of the
     Effective Date, except to the extent such representations and warranties
     specifically relate to an earlier date, in which case such representations
     and warranties shall have been true, correct and complete in all material
     respects on and as of such earlier date;

          (b) the execution and delivery by the Borrowers of this Amendment are
     within the corporate power and authority of the Borrowers, have been duly
     authorized by all requisite corporate action of the Borrowers, and do not
     and will not contravene any provision of applicable law or the Borrowers'
     articles of incorporation or by-laws, or any amendment thereof, or any
     indenture, agreement, instrument or undertaking binding on the Borrowers,
     including, without limitation, the Note Purchase Agreement. This Amendment
     has been duly executed by the Borrowers;

          (c) the Credit Agreement and the other Loan Documents remain in full
     force and effect and constitute the legal, valid and binding obligations of
     the Borrowers, enforceable in accordance with their terms, except as
     limited by bankruptcy, insolvency, reorganization, moratorium or similar
     laws relating to or affecting generally the enforcement of creditor's
     rights;

                                       -2-

<PAGE>

          (d) on and as of the date hereof, and on the Effective Date, after
     giving effect to this Amendment, no Default or Event of Default has
     occurred or will otherwise exist; and

          (e) All Subsidiary Loan Parties, and all Subsidiaries of Crawford that
     are required to be or become a Subsidiary Loan Party pursuant to Section
     5.10 of the Credit Agreement, have duly executed and delivered the
     Reaffirmation (as defined below).

          Section 4. Conditions Precedent. This Amendment, and the amendments
contemplated hereby, shall become effective as of the date (the "Effective
Date") that the Administrative Agent shall have received each of the following,
in form and substance satisfactory to it:

          (a) This Amendment, duly executed and delivered by the Borrowers, the
     Lenders and the Administrative Agent.

          (b) A Reaffirmation of Obligations under Loan Documents (the
     "Reaffirmation") duly executed by the Borrowers, the Administrative Agent,
     the Lenders and each of the Subsidiary Loan Parties, in the form of Exhibit
     A attached hereto;

          (c) on or prior to the Effective Date, delivery of certified copies of
     all consents, approvals, authorizations, registrations, or filings required
     to be made or obtained, if any, by either Borrower and any Subsidiary Loan
     Party in connection with this Amendment and the transactions contemplated
     herein; and

          (d) Such other documents as the Administrative Agent on behalf of the
     Lenders may reasonably request.

          Section 5. Release. In consideration of the amendments contained
herein, the Borrowers hereby waive and release each of the Lenders, the
Administrative Agent and the Issuing Bank from any and all claims and defenses,
known or unknown, with respect to the Credit Agreement and the other Loan
Documents and the transactions contemplated thereby.

          Section 6. Miscellaneous. Except as expressly herein provided, the
Credit Agreement shall remain unchanged and in full force and effect. This
Amendment may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument and any of the parties
hereto may execute this Amendment by signing any such counterpart and sending
the same by telecopier, mail, messenger or courier to the Administrative Agent.
This Amendment shall be governed by, and construed in accordance with, the law
of the State of New York.

                  [Remainder of page intentionally left bank.]

                                       -3-

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Amendment No.
1 to First Amended and Restated Credit Agreement to be duly executed as of the
date first above written.

                                        BORROWERS

                                        CRAWFORD & COMPANY

                                        By: /s/ J. R. Caporaso
                                            ------------------------------------
                                        Name: Joseph R. Caporaso
                                        Title: Senior Vice President & Treasurer

                                        U.S. Federal Tax Identification
                                        No.: 58-0506554

                                        CRAWFORD & COMPANY INTERNATIONAL, INC.

                                        By: /s/ J. R. Caporaso
                                            ------------------------------------
                                        Name: Joseph R. Caporaso
                                        Title: Vice President & Treasurer

                                        U.S. Federal Tax Identification
                                        No.: 58-1925694

                                        Notice Address:

                                        5620 Glenridge Drive N.E.
                                        Atlanta, Georgia 30342
                                        Attention: Joe Caporaso
                                        Telecopy No.: 404-845-3127

                                       -4-

<PAGE>

                                        LENDERS

                                        SUNTRUST BANK,
                                           as Administrative Agent, Issuing
                                           Bank,
                                           as Swingline Lender and as a Lender

                                        By: /s/ Kelly Gunter
                                            ------------------------------------
                                        Name: Kelly Gunter
                                        Title: Vice President

                                        BANK OF AMERICA, N.A.,
                                           as Syndication Agent and a Lender

                                        By: /s/ Kristen Carver
                                            ------------------------------------
                                        Name: Kristen Carver
                                        Title: Vice President

                                        CITIBANK, N.A.,
                                           as a Lender

                                        By: /s/ Tom Hollahan
                                            ------------------------------------
                                        Name: Tom Hollahan
                                        Title: Vice President

                                       -5-

<PAGE>

                                    EXHIBIT A

                REAFFIRMATION OF OBLIGATIONS UNDER LOAN DOCUMENTS

     Reference is hereby made to that certain First Amended and Restated Credit
Agreement dated as of September 30, 2005 among Crawford & Company, Crawford &
Company International, Inc., the Lenders a party thereto and SunTrust Bank, as
Administrative Agent, as amended pursuant to that certain Amendment No. 1 to
First Amended and Restated Credit Agreement dated as of June 16, 2006 (as so
amended, the "Credit Agreement"; capitalized terms used herein and not defined
herein have the meanings ascribed to such terms in the Credit Agreement).

     Crawford hereby (i) reaffirms its continuing obligations owing to the
Collateral Agent (as defined in the Pledge Agreement) and the Lenders under the
Pledge Agreement and (ii) confirms that the liens and security interests created
by the Pledge Agreement continue to secure the Pledged Obligations (as defined
in the Pledge Agreement).

     Each of the undersigned Loan Parties hereby reaffirms its continuing
obligations owing to the Administrative Agent and the Lenders under each of the
other Loan Document (including, without limitation, the Notes and the Subsidiary
Guaranty Agreement) to which such Person is a party, and each Loan Party agrees
that the amendments contained in Amendment No. 1 to First Amended and Restated
Credit Agreement shall not in any way affect the validity and/or enforceability
of any such other Loan Document, or reduce, impair or discharge the obligations
of such Person thereunder.

     Each of the undersigned Loan Parties hereby represents and warrants to the
Collateral Agent, the Administrative Agent and the Lenders that: (a) the
execution and delivery by the Loan Parties of this Reaffirmation is within the
power (corporate or otherwise) and authority of the Loan Parties, has been duly
authorized and approved by all requisite action on the part of the Loan Parties,
and does not and will not contravene, breach or conflict with any provision of
applicable law or any of the charter or other organic documents of the Loan
Parties, or any indenture, agreement, instrument or undertaking binding on the
Loan Parties; (b) this Reaffirmation has been duly executed by the Loan Parties;
(c) the Loan Documents remain in full force and effect and constitute the legal,
valid and binding obligations of the Loan Parties, enforceable in accordance
with their terms, except as limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or affecting generally the enforcement of
creditor's rights; and (d) all of the Obligations are absolute and
unconditional, and such Obligations are not subject to any claim, defense,
deduction, right of offset or otherwise.

     This Reaffirmation shall be construed in accordance with and be governed by
the law (without giving effect to the conflict of law principles thereof) of the
State of New York.

<PAGE>

     IN WITNESS WHEREOF, each of the undersigned has duly executed and delivered
this Reaffirmation of Obligations under Loan Documents as of June 16, 2006.

                                        CRAWFORD & COMPANY

                                        By: /s/ J. R. Caporaso
                                            ------------------------------------
                                        Name: Joseph R. Caporaso
                                        Title: Senior Vice President & Treasurer

                                        CRAWFORD & COMPANY INTERNATIONAL, INC.

                                        By: /s/ J. R. Caporaso
                                            ------------------------------------
                                        Name: Joseph R. Caporaso
                                        Title: Vice President & Treasurer

                                        CRAWFORD LEASING SERVICES, INC.
                                        THE PRISM NETWORK, INC.
                                        CALESCO, INC.
                                        CRAWFORD & COMPANY
                                           OF NEW YORK, INC.
                                        CRAWFORD & COMPANY
                                           HEALTHCARE MANAGEMENT, INC.
                                        RISK SCIENCES GROUP, INC.
                                        QIRRA CUSTOM SOFTWARE, INC.
                                        BROCKLEHURST MILLER, INC.
                                        BROCKLEHURST, INC.

                                        By: /s/ J. R. Caporaso
                                            ------------------------------------
                                        Name: Joseph R. Caporaso
                                        Title: Treasurer

                                       -2-

<PAGE>

           [SIGNATURE PAGE TO CRAWFORD / REAFFIRMATION OF OBLIGATIONS
                 UNDER LOAN DOCUMENTS DATED AS OF JUNE 16, 2006]

                                        CRAWFORD INVESTIGATION SERVICES, INC.

                                        By: /s/ John F. Pflanz
                                            ------------------------------------
                                        Name: John F. Pflanz
                                        Title: President

                                        CRAWFORD & COMPANY, L.P.

                                        By: CRAWFORD & COMPANY,
                                            as General Partner

                                        By: /s/ J. R. Caporaso
                                            ------------------------------------
                                        Name: Joseph R. Caporaso
                                        Title: Senior Vice President & Treasurer

                                        THE GARDEN CITY GROUP, INC.

                                        By: /s/ J. R. Caporaso
                                            ------------------------------------
                                        Name: Joseph R. Caporaso
                                        Title: Treasurer

                                        CRAWFORD & COMPANY OF CALIFORNIA

                                        By: /s/ Jeffrey B. Van Fleet
                                            ------------------------------------
                                        Name: Jeffrey B. Van Fleet
                                        Title: President

                                       -3-

<PAGE>

           [SIGNATURE PAGE TO CRAWFORD / REAFFIRMATION OF OBLIGATIONS
                 UNDER LOAN DOCUMENTS DATED AS OF JUNE 16, 2006]

                                        CRAWFORD & COMPANY OF ILLINOIS

                                        By: /s/ Joseph P. Rainey
                                            ------------------------------------
                                        Name: Joseph P. Rainey
                                        Title: President

                                        CRAWFORD & COMPANY OF FLORIDA

                                        By: /s/ Henry Taylor
                                            ------------------------------------
                                        Name: Henry Taylor
                                        Title: President

                                        CRAWFORD & COMPANY
                                           EMPLOYMENT SERVICES, INC.

                                        By: /s/ Matt C. Wilkinson
                                            ------------------------------------
                                        Name: Matt C. Wilkinson
                                        Title: President

                                        CRAWFORD HEALTHCARE
                                        MANAGEMENT OF NORFOLK
                                        AND BALTIMORE, INC.

                                        By: /s/ William L. Beach
                                            ------------------------------------
                                        Name: William L. Beach
                                        Title: Vice President & Secretary

                               [END OF SIGNATURES]

                                       -4-

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