Exhibit 10(f)
AMENDMENT NO. 2 TO FINANCING AGREEMENT AND WAIVER
THIS AMENDMENT NO. 2 TO FINANCING AGREEMENT AND WAIVER, dated as of
July 20, 2004 (this "Amendment"), by and among Solutia Inc., as a debtor and
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debtor-in-possession, a Delaware corporation (the "Parent"), and Solutia
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Business Enterprises, Inc., as a debtor and debtor-in-possession, a New York
corporation, ("Solutia Business" and together with the Parent, each a
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"Borrower" and collectively, the "Borrowers"), each subsidiary of the Parent
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listed as a "Guarantor" on the signature pages hereto, each as a debtor and
debtor-in-possession (each a "Guarantor" and collectively, the
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"Guarantors"), the lenders from time to time party hereto (each a "Lender"
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and collectively, the "Lenders"), the issuers from time to time party hereto
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(each an "Issuer" and collectively, the "Issuers"), Citicorp USA, Inc.
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("CUSA"), as collateral agent for the Lenders (in such capacity, the
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"Collateral Agent"), CUSA, as administrative agent for the Lenders (in such
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capacity, the "Administrative Agent"), and CUSA and Xxxxx Fargo Foothill,
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LLC, as co-documentation agents for the Lenders, (in such capacity, the
"Documentation Agent" and together with the Collateral Agent and the
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Administrative Agent, each an "Agent" and collectively, the "Agents").
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RECITALS:
WHEREAS, the Borrowers, the Guarantors, the Lenders, the Issuers,
and the Agents have heretofore entered into that certain Financing
Agreement, dated as of January 16, 2004, as amended by that certain
Amendment No. 1 to Financing Agreement and Waiver, dated as of March 1, 2004
(as so amended, the "Financing Agreement");
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WHEREAS, the Borrowers, the Guarantors, the Lenders, the Issuers
and the Agents now desire to amend the Financing Agreement in certain
respects, as hereinafter provided; and
WHEREAS, the Borrowers have requested the Lenders to waive
compliance with certain provisions of the Financing Agreement.
NOW, THEREFORE, in consideration of the premises set forth above,
the terms and conditions contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Unless otherwise defined or the
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context otherwise requires, terms for which meanings are provided in the
Financing Agreement shall have such meanings when used in this Amendment.
ARTICLE II
AMENDMENTS
Section 2.01 Amendments to Section 1.01 of the Financing
-------------------------------------------
Agreement.
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(a) Section 1.01 of the Financing Agreement is
hereby amended by inserting the following definitions of "Astaris Deferral
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Agreement", "Astaris Deferred Receivables", "Astaris Operating Agreement",
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"Chlorobenzene Business", "Liquidity Event", "Permitted Non-Cash
---------------------- --------------- ------------------
Consideration", "Specified Intellectual Property", and "Specified Service
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Contracts" in the proper alphabetical position:
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"'Astaris Deferral Agreement' means a written
--------------------------
contract between Astaris and the Parent regarding the deferral of
payments referred to in Section 8.02(j)(v) under the Astaris
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Operating Agreement, providing for repayment of all Astaris
Deferred Receivables no later than the earlier of (i) a Liquidity
Event, or (ii) October 1, 2005."
"'Astaris Deferred Receivables' means Receivables
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payable with respect to the Astaris Operating Agreement that have
been outstanding for more than 30 days."
"'Astaris Operating Agreement' means the Master
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Lease and Operating Agreement, dated as of April 1, 2000, between
Astaris and the Parent, as amended from time to time."
"'Chlorobenzene Business' means the line of
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business operated out of the Krummrich, Illinois and Anniston,
Alabama facilities which produces Mono-chlorobenzenes and
Di-chlorobenzenes primarily for use in herbicides, general and
process solvents, dies, pigments, deodorizers and pesticides."
"'Liquidity Event' means, with respect to a
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Person, means any one of the following: (i) a merger or
consolidation of such Person with or into another Person, (ii) the
sale, transfer or lease of all or or a substantial portion of the
assets of such Person, (iii) a sale of Capital Stock of such
Person, or (iv) an issuance of funded Indebtedness of such Person."
"'Permitted Non-Cash Consideration' means
--------------------------------
preferred stock, notes, or other contracts providing for payment of
an obligation in cash over time."
"'Specified Intellectual Property' means, with
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respect to the permitted disposition of any Subsidiary, line of
business, or facility, intellectual property used or useful with
respect to such Subsidiary, line of business, or facility, the
disposition of which would not cause a Material Adverse Effect, or
a material adverse effect on any other Loan Party or other
Subsidiary."
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"'Specified Service Contracts' means, with
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respect to the permitted disposition of any Subsidiary, line of
business, or facility, service contracts used or useful with
respect to such Subsidiary, line of business, or facility, the
disposition of which would not cause a Material Adverse Effect, or
a material adverse effect on any other Loan Party or other
Subsidiary."
(b) Section 1.01 of the Financing Agreement is
hereby amended by inserting the words "or loss" after the word "income"
appearing in clause (f) of the definition of "Consolidated Net Income"
therein.
(c) Section 1.01 of the Financing Agreement is
hereby amended by deleting clause (x) of the proviso to the definition of
"Contingent Obligation" appearing therein and inserting the following new
clause (x) in lieu thereof:
"(x) customary indemnification obligations which
are (I) provided in the ordinary course to the directors, officers,
employees, agents, independent contractors or service providers of
the Parent or any of its Subsidiaries, (II) in connection with the
sale or disposition of property, or (III) in connection with the
execution in the ordinary course of business of customer supply
contracts, service contracts and equipment or real property leases
(or the assumption or extension of such agreements),"
(d) Section 1.01 of the Financing Agreement is
hereby amended by deleting the proviso appearing at the end of the
definition of "Extraordinary Receipts" appearing therein and inserting the
following words in lieu thereof:
"provided that "Extraordinary Receipts" shall not
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include cash received by the Parent or any of its Subsidiaries (y)
amounting to less than $10,000 per receipt, without limitation as
to aggregate amount, or (z) amounting to $10,000 or more per
receipt and less than $50,000 per receipt, up to an aggregate
exclusion under this clause (z) of $1,000,000 for all such receipts
per Fiscal Year."
(e) Section 1.01 of the Financing Agreement is
hereby amended by deleting clause (c) of the definition of "Permitted
Indebtedness" appearing therein and inserting the following new clause (c)
in lieu thereof:
"(c) Indebtedness evidenced by Capitalized Lease
Obligations entered into after the Filing Date in order to finance
Capital Expenditures made by the Loan Parties or their Subsidiaries
in accordance with the provisions of Section 8.02(g), which
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Indebtedness, when aggregated with the principal amount of all
Indebtedness incurred under this clause (c) and clause (d) of this
definition, does not exceed $10,000,000 at any time outstanding;"
(f) Section 1.01 of the Financing Agreement is
hereby amended by inserting the words "(or substantially equivalent foreign
instruments pursuant to which the issuer agrees to honor a draft or a demand
for payment made by the third party)" after
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the words "letters of credit" appearing in sub-clause (y) of clause (i) of
the definition of "Permitted Indebtedness" therein.
(g) Section 1.01 of the Financing Agreement is
hereby amended by (i) deleting the word "and" appearing at the end of clause
(j) of the definition of "Permitted Liens" therein, (ii) deleting the period
appearing at the end of clause (k) of such definition and inserting a
semicolon in lieu thereof, and (iii) inserting the following new clauses
(l), (m) and (n) at the end thereof:
"(l) sales of receivables permitted by Section
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8.02(c)(i)(J);
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(m) sales of inventory subject to return
permitted by Section 9.05(h); and
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(n) institutional controls permitted by
governmental entities on real properties in connection with
environmental remediation activities, including, without
limitation, land-use restrictions, natural resource-use
restrictions, well restriction areas, deed restrictions, deed
notices, declaration of environmental restrictions, access
controls, monitoring requirements, site posting requirements,
information distribution, notification in closure letter,
restrictive covenants, and Federal/State/county/local registries,
in each case that do not materially impair the value of such
property and do not materially impair such property's use by any
Loan Party or any of its Subsidiaries in the normal conduct of such
Person's business."
(h) Section 1.01 of the Financing Agreement is
hereby amended by deleting the definition of "Solutia Therminol Investment"
appearing therein and inserting the following new definition in lieu
thereof:
"'Solutia Therminol Investment' means the
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investment by Solutia Chemical Co. Ltd. Suzhou in Solutia Therminol
Co. Ltd., which shall be accomplished, first, by a dividend from
Solutia Chemical Co. Ltd. Suzhou to each of Solutia Greater China,
Inc. and Jiangsu Chemical Pesticide Group Company Ltd., and,
second, by corresponding capital contributions from Solutia Greater
China, Inc. and Jiangsu Chemical Pesticide Group Company Ltd. into
Solutia Therminol Co. Ltd. Suzhou, it being understood that such
investment will involve no transfer of cash from the United
States."
Section 2.02 Amendment to Section 2.05 of the Financing
------------------------------------------
Agreement. Section 2.05 of the Financing Agreement is hereby amended in the
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manner set forth below:
(a) Section 2.05(a)(iii) is hereby amended and
restated to read in its entirety as follows:
"(iii) [intentionally omitted]."
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(b) The first sentence of Section 2.05(c)(iii) is
hereby amended and restated to read in its entirety as follows:
"Immediately upon any Disposition by any Loan
Party or its Subsidiaries (other than a Disposition of assets of
Solutia Europe or any of its Subsidiaries or a Disposition of
assets pursuant to Section 8.02(c)(i)(L)), the Borrowers shall
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prepay the outstanding principal amount of the Loans in an amount
equal to 100% of the Net Cash Proceeds received by such Person in
connection with such Disposition; provided, however, that so long
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as no Default or Event of Default has occurred and is continuing on
the date such Person receives such Net Cash Proceeds, (A) with
respect to the first $5,000,000 of Net Cash Proceeds received in
respect of Dispositions pursuant to Section 8.02(c)(i)(F) of assets
---------------------
listed on Part III of Schedule 8.02(c)(i), no prepayment shall be
-------------------
required, and (B) with respect to the next $10,000,000 of Net Cash
Proceeds received in respect of Dispositions pursuant to Section
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8.02(c)(i)(F) of assets listed on Part III of Schedule 8.02(c)(i),
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the Borrowers shall prepay the outstanding principal amount of the
Loans in an amount equal to 50% of the Net Cash Proceeds received
by such Person in connection with such Disposition."
(c) Section 2.05(c) is hereby amended by
inserting the following sentence at the end of Section 2.05(c)(iii):
"In the event of a Disposition of businesses
comprising assets owned by both (x) any Loan Party or its
Subsidiaries (other than Solutia Europe and its Subsidiaries) (the
"DIP Assets") and (y) Solutia Europe or its Subsidiaries (the "Euro
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Assets"), including either of the transactions listed as items 2
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and 3 on Part II of Schedule 8.02(c)(i), the amount of any payments
required to be made under this clause (iii) related to the DIP
Assets shall be determined by allocating the Net Cash Proceeds of
such Disposition between the DIP Assets and the Euro Assets based
upon the relative value of such assets, such allocation to be
satisfactory to the Administrative Agent in its discretion,
provided that it shall be understood that no mandatory prepayments
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shall be required in the event that any such Disposition shall
involve only the assets of Solutia Europe or any of its
Subsidiaries."
(d) Section 2.05(c)(v) is hereby amended and
restated to read in its entirety as follows:
"(iii) [intentionally omitted]."
(e) Section 2.05(c)(vii)(A) is hereby amended by
deleting the words "the Agents" appearing therein and inserting in lieu
thereof the words "the Administrative Agent and the Collateral Agent".
(f) Section 2.05(c)(vii)(B) is hereby amended and
restated to read in its entirety as follows:
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"(B) the Borrowers shall not be required to make
a prepayment under clause (iii) or (iv) of this Section 2.05(c)
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(except in the event that prepayment would otherwise be required by
another provision of this Agreement, including clause (vi) of this
Section 2.05(c), in which event prepayment shall be made in
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accordance with such other provision), unless the aggregate amount
of Net Cash Proceeds received as a result of the events described
in such Sections exceeds $7,500,000 and any such required
prepayment under such Sections shall be limited to the Net Cash
Proceeds and Extraordinary Receipts, net of any reasonable expenses
incurred in connection with such Extraordinary Receipts, exceeding
$7,500,000."
(g) Section 2.05(d) is hereby amended by (i)
inserting the word "and" at the end of Section 2.05(d)(ii), (ii) deleting
the text "; and" appearing at the end of Section 2.05(d)(iii) and inserting
a period in lieu thereof, and (iii) deleting Section 2.05(d)(iv) in its
entirety.
Section 2.03 Amendment to Section 6.01 of the Financing
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Agreement. Section 6.01(n) of the Financing Agreement is hereby amended by
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inserting the words ", either directly or by contributing the principal and
interest thereof to Solutia Europe in exchange for the issuance of new
stock," after the words "convert all or a portion thereof" appearing in
clause (B) thereof.
Section 2.04 Amendment to Section 7.01 of the Financing
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Agreement. Section 7.01 of the Financing Agreement is hereby amended in the
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manner set forth below:
(a) Section 7.01(o)(ii) is hereby amended by
inserting the words ", except to the extent rejected by any Loan Party
following the Petition Date in accordance with the terms hereof" following
the words "is in full force and effect" appearing in the fourth sentence
therein.
(b) Section 7.01(r)(xvi) of the Financing
Agreement is hereby amended and restated to read in its entirety as follows:
"(xvi) based upon the best information
available to the Loan Parties on July 20, 2004, the Loan Parties
have a good faith belief that they will not (A) exceed by
$5,000,000 any of the annual or aggregate Environmental Liabilities
and Costs for any of the "Operating Facilities" set forth on Part B
of Schedule 7.01(r) or (B) exceed by ten percent (10%) or more the
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combined annual or aggregate Environmental Liabilities and Costs
for all of such "Operating Facilities" set forth on Part B of
Schedule 7.01(r); and".
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Section 2.05 Amendment to Section 8.01 of the Financing
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Agreement. Section 8.01 of the Financing Agreement is hereby amended in the
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manner set forth below:
(a) The first paragraph of Section 8.01(a) is
hereby amended and restated to read in its entirety as follows:
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"(a) Reporting Requirements. Furnish (which may
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be effectuated via electronic mail in accordance with the
electronic mail address designated by each Agent and each Lender to
the Administrative Borrower in writing, provided that, if any such
Agent requests that such reports or other information be delivered
by mail, telecopier or courier, then such reports or other
information shall be delivered by such manner in accordance with
Section 13.01) to each Agent and each Lender:"
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(b) Section 8.01(a)(xviii) is hereby amended by
deleting the words "written reports" appearing therein and inserting the
words "material written reports and presentations" in lieu thereof.
(c) Section 8.01(b) is hereby amended by
inserting the words "(x) with a Current Value in excess of $5,000,000 in the
case of a fee interest, or (y) requiring the payment of annual rent
exceeding in the aggregate $2,500,000 in the case of a leasehold interest,"
after the words "one or more Mortgages creating on the real property of such
Subsidiary" appearing in sub-clause (D) of clause (i) thereof.
(d) Section 8.01(d) is hereby amended by
inserting the words "other than the Significant Subsidiary described in item
3 on Part II of Schedule 8.02(c)(i) in connection with the disposition of
the business described in such item" after the words "makes such
qualification necessary".
(e) Section 8.01(h) is hereby amended by
inserting the words "(as adjusted appropriately to take into account changes
to business operations and liabilities subject to compromise)" after the
words "insurance maintained by the Parent and its Subsidiaries on the
Facility Effective Date" in contained in the first sentence therein.
(f) Clause (iii) of Section 8.01(j) is hereby
amended and restated to read in its entirety as follows:
"(iii) provide the Administrative Agent and the
Collateral Agent written notice within ten (10) days of any Release
of a Hazardous Material in excess of any reportable quantity from
or onto property owned or operated by it or any of its Subsidiaries
for which it is reasonably foreseeable that such Release would
result in the need to take any Remedial Actions of soil,
groundwater, or surface water required under Environmental Laws;"
(g) Clause (v) of Section 8.01(j) is hereby
amended and restated to read in its entirety as follows:
"(v) provide the Collateral Agent with prompt
written notice if the Loan Parties will (A) exceed by $5,000,000
any of the annual or aggregate Environmental Liabilities and Costs
for any of the "Operating Facilities" set forth on Part B of
Schedule 7.01(r) or (B) exceed by ten percent (10%) or more the
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combined annual or aggregate Environmental Liabilities and Costs
for all of such "Operating Facilities" set forth on Part B of
Schedule 7.01(r); and"
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(h) Section 8.01(r) is hereby amended by
inserting the following new clause (iv):
"(iv) As soon as practicable but not
later than September 30, 2004, or such later date as may be agreed
to by the Administrative Agent in its sole discretion, either (A)
deliver to the Administrative Agent an Astaris Deferral Agreement,
together with any necessary approvals of the Bankruptcy Court with
respect thereto, such agreement and approvals to be reasonably
satisfactory in form and substance to the Administrative Agent, or
(B) commence collecting all Receivables with respect to the Astaris
Operating Agreement on a basis no less frequent than monthly, such
that no Receivables arising after September 30, 2004 (or such later
date) with respect to such agreement become Astaris Deferred
Receivables, provided, however, that if Astaris were to become a
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debtor in a case under the Bankruptcy Code, the Loan Parties'
failure to comply with this Section 8.01(r)(iv) shall not be an
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Event of Default so long as, and to the extent that, the Loan
Parties are prevented from enforcing their rights with respect to
the Astaris Deferred Receivables by operation of the automatic stay
of Section 362 of the Bankruptcy Code."
Section 2.06 Amendment to Section 8.02 of the Financing
------------------------------------------
Agreement. Section 8.02 of the Financing Agreement is hereby amended in the
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manner set forth below:
(a) Section 8.02(c)(i) is hereby amended and
restated to read in its entirety as follows:
"(i) any Loan Party and its Subsidiaries
may (A) sell Inventory in the ordinary course of business, (B) sell
or otherwise dispose of obsolete or worn-out equipment or equipment
no longer used in the ordinary course of business, (C) sell or
otherwise dispose of other property or assets for cash in an
aggregate amount not less than the fair market value of such
property or assets, (D) enter into licensing arrangements entered
into in the ordinary course of business, (E) sell or otherwise
dispose of its properties or assets to any Loan Party; (F) sell or
otherwise dispose of the assets described on Parts I, II and III of
Schedule 8.02(c)(i) for cash in an aggregate amount not less than
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the fair market value of such property or assets (in each case
except as otherwise expressly provided on such schedule); (G) sell
or otherwise dispose of other property or assets for cash in an
aggregate amount not less than the fair market value of such
property or assets in an amount not to exceed $500,000 per
transaction pursuant to sales procedures established by the
Bankruptcy Court for non-core assets sales pursuant to an order
dated March 29, 2004; (H) sell or otherwise dispose of other
property or assets for cash in an aggregate amount not less than
the fair market value of such property or assets pursuant to any
motion under Section 363 of the Bankruptcy Code to which no Lender
or Agent files an objection; (I) sell or otherwise dispose of other
property or assets related to Subsidiaries or business lines that
are liquidated or wound down in accordance with Section 8.02(c)(iv)
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or (vii); (J) sell accounts receivable (including sales of such
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accounts receivable at a
8
discount to face value) for cash in an amount not less than the
fair market value of such accounts receivable, as follows: (I)
Subsidiaries who are not Loan Parties may sell, as part of one or
more financings, on a non-recourse basis, at a discount of not
greater than 5% of face value, up to $5,000,000 in aggregate
principal amount of Accounts Receivable during any 90-day period
(measured on a rolling basis); (II) Subsidiaries who are not Loan
Parties may sell, as part of one or more financings, on a recourse
basis, at a discount of not greater than 5% of face value, up to
$2,000,000 in aggregate principal amount of Accounts Receivable
during any 90-day period (measured on a rolling basis); and (III)
any Loan Party and its Subsidiaries may sell, on a non-recourse
basis, up to $5,000,000 in aggregate principal amount of additional
Accounts Receivable in addition to those specified in subclauses
(I) and (II) above; (K) enter into leases and subleases of real
property in the ordinary course of business and subject to the
other provisions herein; and (L) make charitable donations, subject
to approval of the Bankruptcy Court (as required) and so long as no
Default or Event of Default shall have occurred and be continuing
either before or after giving effect to any such donation, (y) of
cash or property in the ordinary course of business consistent with
past practices, such donations not to exceed $5,000 in value for
each donation and not to exceed $50,000 in aggregate amount and (z)
of parcels of real property specified on Part IV of Schedule
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8.02(c)(i); provided that the Net Cash Proceeds of such
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Dispositions (x) in the case of clauses (B) and (C) above, do not
exceed $5,000,000 in the aggregate in any 12-month period (Net Cash
Proceeds of earn-out payments referred to in Section 8.02(e)(xiv)
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to be included as of the date when actually received), (y) in the
case of clauses (G) through (I) above, do not exceed $5,000,000 in
the aggregate, and (z) in all cases, are paid to the Administrative
Agent for the benefit of the Lenders pursuant to the terms of
Section 2.05(c); provided, further, that other than (x) parcels of
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real property set forth on Part III of Schedule 8.02(c)(i), (y)
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sales or other dispositions of Principal Properties or portions
thereof pursuant to clause (G) above, and (z) dispositions of
immaterial portions of any Principal Property that are subject and
subordinate to the Lien of the Collateral Agent for the benefit of
the Lenders (including, without limitation, the entry into leases
and subleases and the grant of easements), no Loan Party may sell
or otherwise dispose of any Principal Property."
(b) Section 8.02(c) is hereby further amended by
(i) deleting the word "and" appearing at the end of Section 8.02(c)(iv),
(ii) deleting the period appearing at the end of Section 8.02(c)(v) and
inserting a semicolon in lieu thereof, and (iii) inserting the following
Sections 8.02(c)(vi) through 8.02(c)(ix):
"(vi) any Loan Party and its
Subsidiaries may, subject to approval of the Bankruptcy Court (as
required), purchase or otherwise acquire all or substantially all
of the assets of entities having an aggregate value of not more
than $1,000,000, such purchases and acquisitions not to exceed
$5,000,000 in the aggregate;
(vii) any Loan Party and its
Subsidiaries may, so long as (A) no other provision of this
Agreement would be violated thereby, and (B) no
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Default or Event of Default shall have occurred and be continuing
either before or after giving effect to such transaction, wind down
businesses or operations constituting (x) business lines generating
less than 2% of consolidated revenue of the Loan Parties; (y) the
Chlorobenzene Business; or (z) the business described in item 10.C
on Part III of Schedule 8.02(c)(i);
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(viii) Parent may, so long as (A) no
other provision of this Agreement would be violated thereby, and
(B) no Default or Event of Default shall have occurred and be
continuing either before or after giving effect to such
transaction, liquidate the "Significant Subsidiary" described in
item 3 on Part II of Schedule 8.02(c)(i) in connection with the
-------------------
disposition of the business described in such item in accordance
with Section 8.02(c)(i)(F) hereof; and
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(ix) (A) CarboGen AG and Amcis AG may be
merged into or consolidated or amalgamated with each other, so long
as (x) no other provision of this Agreement would be violated
thereby, and (y) no Default or Event of Default shall have occurred
and be continuing either before or after giving effect to such
transaction, and (B) Solutia Services International SCA/Xxxx.XX may
be merged into, or consolidated or amalgamated with, Solutia
Europe, so long as (x) no other provision of this Agreement would
be violated thereby, (y) no Default or Event of Default shall have
occurred and be continuing either before or after giving effect to
such transaction, and (z) all of the non-voting Capital Stock and
65% of the voting Capital Stock of the surviving Foreign Subsidiary
is the subject of a Pledge Agreement, which is in full force and
effect on the date of and immediately after giving effect to such
merger, consolidation or amalgamation."
(c) Section 8.02(d) is hereby amended by deleting
the period appearing at the end thereof and inserting the words ", other
than changes permitted by Section 8.02(c)(vii)(z)." in lieu thereof.
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(d) Section 8.02(e)(xii)(A) is hereby amended by
inserting the words "invested by any Loan Party or any Subsidiary thereof"
immediately following the figure "$3,000,000".
(e) Section 8.02(e) is hereby amended by (i)
deleting the word "and" appearing at the end of Section 8.02(e)(xii), (ii)
deleting the period appearing at the end of Section 8.02(e)(xiii) and
inserting a semicolon in lieu thereof, and (iii) inserting the following
Sections 8.02(e)(xiv) through 8.02(e)(xvi):
"(xiv) earn-out provisions contained in
transactions permitted by Section 8.02(c);
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(xv) investments in common Capital Stock
of Solutia Europe issued pursuant to a conversion pursuant to
Section 6.01(n), whether direct or indirect, of the intercompany
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convertible bond made by Solutia Europe to Solutia Investments LLC
and Monchem International, Inc; and
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(xvi) investments by a Loan Party or any
Subsidiary thereof in respect of the entity listed on Part II of
Schedule 8.02(e), the aggregate amount of such investments not to
exceed in the aggregate the amount specified on such schedule,
provided, that (A) both immediately before and after the making of
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any such investment, no Default or Event of Default has occurred or
is continuing, (B) immediately after the making of such investments
Availability exceeds $50,000,000, (C) such investments shall be
subject to approval of the Bankruptcy Court (as required), (D) no
assets or property (including cash and cash equivalents) of any
Loan Party shall be used, directly or indirectly (including by way
of loans, advances, guarantees, or investments in Capital Stock of
any Subsidiary), to acquire, hold, or maintain, or to provide the
necessary funds to acquire, hold or maintain, any investment
acquired, owned, held or maintained by any Subsidiary that is not a
Loan Party, and (E) in the case of any investment by any Loan
Party, any Capital Stock or other assets received in respect of
such investment shall be pledged in accordance with the
requirements of the Loan Documents."
(f) Section 8.02(f) is hereby amended by (i)
inserting the words "other than in connection with any of (x) the Maryville
Centre headquarters located in St. Louis, Missouri, (y) the Westport
facility located in St. Louis, Missouri, or (z) the European headquarters
located in Louvain la Neuve, Belgium" immediately following the words "in
connection with any sale and leaseback transaction" appearing in clause (i)
thereof, and (ii) by inserting the words "(other than in connection with the
assumption or extension of leases in effect as of the Facility Effective
Date or the execution of leases in replacement thereof, provided such
--------
replacement leases relate to the same or substantially similar property as
the leases being replaced)" following the words "Operating Lease Obligations
with respect to leases entered into after the Facility Effective Date"
appearing in clause (ii)(B) therein.
(g) Section 8.02(h) is hereby further amended by
deleting the proviso at the end thereof and inserting the following text in
lieu thereof:
"provided, however, (A) dividends or other
-------- -------
distribution may be made by any Loan Party to another Loan Party,
and by any Subsidiary of a Loan Party who is not a Loan Party to
any Loan Party or any Subsidiary of any Loan Party, (B) the Parent
may pay dividends in the form of common Capital Stock, (C) any Loan
Party may pay service fees to Foreign Subsidiaries in connection
with the sale of such Loan Party's Inventory to Foreign
Subsidiaries or unrelated third parties, provided that, such
payment would also be permitted under Section 8.02(j), (D) any
direct or indirect Subsidiary of Solutia Europe may pay dividends
to Solutia Europe or any Subsidiary of Solutia Europe, and (E)
Solutia Chemical Co. Ltd. Suzhou may pay dividends to Jiangsu
Chemical Pesticide Group Company Ltd. in connection with the
Solutia Therminol Investment."
(h) Section 8.02(j) is hereby amended by (i)
deleting the word "and" appearing at the end of Section 8.02(j)(iii), (ii)
deleting the period appearing at the
11
end of Section 8.02(j)(iii) and inserting a semicolon in lieu thereof, and
(iii) inserting the following Sections 8.02(j)(iv) and (v):
"(iv) as necessary or desirable for the
prudent operation of its business, for fair consideration and on
terms no less favorable to it or its Subsidiaries than would be
obtainable in a comparable arm's length transaction with a Person
that is not an Affiliate thereof, assign, transfer, or exercise,
directly or indirectly, the option held by Parent with respect to
certain real property in Thailand to, or for the benefit of,
Solutia (Thailand) Ltd., (v) the deferral, pursuant to a separate
agreement reached prior to the Petition Date, of payments
receivable by the Loan Parties from Astaris arising in the ordinary
course of business under the Astaris Operating Agreement, and the
execution, delivery and performance of the Astaris Deferral
Agreement, and (vi) as necessary or desirable for the prudent
operation of its business, for fair consideration and on terms no
less favorable to it or its Subsidiaries than would be obtainable
in a comparable arm's length transaction with a Person that is not
an Affiliate thereof, assign or transfer any Specified Intellectual
Property held in the name of the Parent or any Loan Party as of the
Petition Date or Specified Service Contracts to any Subsidiaries in
connection with the transaction described in item 3 of Part II of
Schedule 8.02(c)(i), provided that to the extent reasonably
--------
necessary to effect such transaction, consideration for such
assignment or transfer may consist of a Receivable, so long as such
Receivable is payable within a reasonable time and is subject to
the Lien of the Collateral Agent for the benefit of the Lenders."
(i) Section 8.02(l) is hereby amended by deleting
the period at the end thereof and inserting the words ", and other than
common Capital Stock of Solutia Europe issued pursuant to a conversion
pursuant to Section 6.01(n), whether direct or indirect, of the intercompany
---------------
convertible bond made by Solutia Europe to Solutia Investments LLC and
Monchem International, Inc." in lieu thereof.
(j) Section 8.02(m)(iii) is hereby amended and
restated to read in its entirety as follows:
"(iii) amend, modify or otherwise change the Euro
Indenture or any Euro Note, except for (A) amendments,
modifications or other changes in connection with the sales listed
as items 2 and 3 on Part II of Schedule 8.02(c)(i) as are necessary
-------------------
to effect such sales, or (B) such amendments, modifications or
other changes in connection with the Euro Restructuring
specifically set forth in Schedule 8.02(m) or as otherwise
----------------
acceptable to the Required Lenders in their sole discretion;
provided, that with respect to clauses (A) and (B) above, any such
--------
agreements, instruments and other documents related to any such
sale or to the Euro Restructuring shall be delivered to the
Administrative Agent and the Collateral Agent to provide them with
a reasonable opportunity to review any such documents prior to the
execution, entry or authorization thereof or consummation of any
such sale or the Euro Restructuring, respectively; provided,
--------
further, that with respect to clause (A) above, no such amendment,
-------
modification
12
or change shall be permitted if it could reasonably be expected to
have an adverse effect on the Agents or the Lenders, or"
(k) Section 8.02(o) is hereby amended by deleting
the period appearing at the end thereof and inserting the following proviso
in lieu thereof:
", provided, further, however, that this
-------- ------- -------
Section 8.02(o) shall not prohibit, to the extent otherwise
---------------
permitted hereunder, the deferral, pursuant to a separate agreement
reached prior to the Petition Date, of payments receivable by the
Loan Parties from Astaris arising in the ordinary course of
business under the Astaris Operating Agreement in the manner and to
the extent previously reported to the Administrative Agent, or the
execution, delivery and performance of the Astaris Deferral
Agreement pursuant to Section 8.01(r)(iv)."
-------------------
(l) Section 8.02(r) is hereby amended by deleting
the period appearing at the end thereof and inserting the following text in
lieu thereof:
"in any material respect, provided,
--------
further, however, that this Section 8.02(r) shall not prohibit, to
------- ------- ---------------
the extent otherwise permitted hereunder, the deferral, pursuant to
a separate agreement reached prior to the Petition Date, of
payments receivable by the Loan Parties from Astaris arising in the
ordinary course of business under the Astaris Operating Agreement
in the manner and to the extent previously reported to the
Administrative Agent, or the execution, delivery and performance of
the Astaris Deferral Agreement pursuant to Section 8.01(r)(iv)."
-------------------
(m) Section 8.02(t) is hereby amended by (i)
deleting the word "and" appearing at the end of Section 8.02(t)(xi), (ii)
deleting the period appearing at the end of Section 8.02(t)(xii) and
inserting a semicolon in lieu thereof, and (iii) inserting the following
Sections 8.02(c)(xiii) through 8.02(c)(xv):
"(xiii) in respect of other claims not
otherwise prohibited hereunder in an aggregate amount not to exceed
$250,000 for any claimant or $1,500,000 for all claimants, subject
to approval of the Bankruptcy Court; (xiv) in respect of claims set
forth on Schedule 8.02(t), so long as such claims are fully secured
by cash collateral of the Loan Parties, or fully supported by
letters of credit permitted hereunder, to the extent of the value
of such cash collateral or such letters of credit; and (xv) in
respect of that certain agreement, dated September 9, 2003, among
Solutia, Pharmacia Corporation and Monsanto Company setting forth
the respective settlement obligations among the parties thereto
with respect to certain Litigation (as defined therein) in an
amount not to exceed $5,000,000 in the aggregate in any year, plus
reasonable fees and expenses related thereto."
Section 2.07 Amendment to Section 9.01 of the Financing
------------------------------------------
Agreement. Section 9.01 of the Financing Agreement is hereby amended in the
---------
manner set forth below:
13
(a) The second sentence of Section 9.01(a) is
hereby amended and restated to read in its entirety as follows:
"On or prior to the date specified in
Section 8.01(r)(iii), the Loan Parties shall deliver to the
--------------------
Administrative Agent (x) a Cash Management Agreement with respect
to each Cash Management Account and (y) a Concentration Account
Agreement with respect to each Concentration Account; provided,
--------
however, that so long as account number 0000000 of Xxxxxx Road
-------
Management Company at First Community Bank shall have less than
$10,000 therein, the Loan Parties shall not be required to deliver
a Cash Management Agreement with respect to such account unless
requested by the Administrative Agent pursuant to the last sentence
of this Section 9.01(a)."
---------------
(b) Section 9.04(a) is hereby amended by
inserting the following sentence at the end thereof:
"Notwithstanding the foregoing, this
Section 9.04(a) shall not prohibit, to the extent otherwise
---------------
permitted hereunder, the deferral, pursuant to a separate agreement
reached prior to the Petition Date, of payments receivable by the
Loan Parties from Astaris arising in the ordinary course of
business under the Astaris Operating Agreement in the manner and to
the extent previously reported to the Administrative Agent, or the
execution, delivery and performance of the Astaris Deferral
Agreement pursuant to Section 8.01(r)(iv)."
-------------------
(c) Section 9.04(b) is hereby amended by
inserting the following sentence at the end thereof:
"Notwithstanding the foregoing, this
Section 9.04(b) shall not prohibit, to the extent otherwise
---------------
permitted hereunder, the deferral, pursuant to a separate agreement
reached prior to the Petition Date, of payments receivable by the
Loan Parties from Astaris arising in the ordinary course of
business under the Astaris Operating Agreement in the manner and to
the extent previously reported to the Administrative Agent, or the
execution, delivery and performance of the Astaris Deferral
Agreement pursuant to Section 8.01(r)(iv)."
-------------------
Section 2.08 Amendment to Section 9.05 of the Financing
------------------------------------------
Agreement. Section 9.05 of the Financing Agreement is hereby amended in the
---------
manner set forth below:
(a) Section 9.05(h) is hereby amended and
restated to read in its entirety as follows:
"(h) except as otherwise expressly
permitted under clauses (c)(iii) and (c)(iv) above, and except for
sales of inventory made subject to return in the ordinary course
consistent with past practices in an amount not to exceed in the
aggregate $100,000 at any time outstanding for any customer or
$1,000,000 at any time outstanding for all customers (it being
understood that any Accounts in respect of such inventory shall not
be included among Eligible Accounts to the
14
extent of such return or approval rights), the Loan Parties shall
not sell Inventory to any customer on approval, or any other basis
which entitles the customer to return or may obligate any Loan
Party to repurchase such Inventory; and"
(b) Section 9.05 is hereby amended by (i)
deleting the text "; and" appearing at the end of Section 9.05(i) and
inserting a period in lieu thereof, and (ii) deleting Section 9.05(j).
Section 2.09 Amendment to Section 10.01 of the Financing
-------------------------------------------
Agreement. Section 10.01 of the Financing Agreement is hereby amended in the
---------
manner set forth below:
(a) Section 10.01(k) is hereby amended by
deleting the semicolon appearing at the end thereof and inserting the words
"other than orders agreed to by any Loan Party stipulating relief with
respect to claims that are permitted to be paid pursuant to Section 8.02(t),
constituting (A) claims that are fully secured by cash collateral of the
Loan Parties, or fully supported by letters of credit permitted hereunder,
or (B) prepetition claims effected by a setoff of obligations as permitted
by section 553 of the Bankruptcy Code, in each case the payment of which is
not otherwise prohibited hereunder;" in lieu thereof.
(b) Section 10.01(m) is hereby amended by adding
the words "other than the Significant Subsidiary described in item 3 on Part
II of Schedule 8.02(c)(i) in connection with the disposition of the business
-------------------
described in such item" after the words "seeking authority to do any of the
foregoing".
Section 2.10 Amendment to Schedule 8.02(c)(i) to the
---------------------------------------
Financing Agreement. Schedule 8.02(c)(i) of the Financing Agreement is
-------------------
hereby amended and restated to read in its entirety as set forth in Exhibit
-------
A hereto.
-
Section 2.11 Schedule 8.02(e) to the Financing Agreement.
-------------------------------------------
A new Part II to Schedule 8.02(e) is hereby added to the Financing
Agreement, which schedule shall read in its entirety as set forth in Exhibit
-------
B hereto.
-
Section 2.12 Schedule 8.02(t) to the Financing Agreement.
-------------------------------------------
A new Schedule 8.02(t) is hereby added to the Financing Agreement, which
schedule shall read in its entirety as set forth in Exhibit C hereto.
---------
Section 2.13 Amendment to Schedule 9.01 to the Financing
-------------------------------------------
Agreement. Schedule 9.01 of the Financing Agreement is hereby amended and
---------
restated to read in its entirety as set forth in Exhibit D hereto.
---------
Section 2.14 Amendment to Exhibit C to the Financing
---------------------------------------
Agreement. Exhibit C to the Financing Agreement (Form of Borrowing Base
---------
Certificate) is hereby amended and restated in its entirety as set forth in
Exhibit E hereto.
---------
Section 2.15 Limited Waiver of Sections 6.01(n), 8.02(e)
-------------------------------------------
and 8.02(l) of the Financing Agreement. For avoidance of doubt, the Lenders
--------------------------------------
hereby waive compliance
15
by the Loan Parties with the provisions of Sections 6.01(n), 8.02(e) and
8.02(l) of the Financing Agreement on a retroactive basis to the extent that
such sections would prohibit the contribution of principal and interest due
under the intercompany convertible bond made by Solutia Europe to Solutia
Investments LLC and Monchem International, Inc. (the "Convertible Bond") to
----------------
Solutia Europe in exchange for the issuance of shares of common stock of
Solutia Europe. Such waiver does not constitute a waiver of Sections
6.01(n), 8.02(e) or 8.02(l) of the Financing Agreement as amended herein,
any other provision of the Financing Agreement or any other Loan Document or
any waiver of any other Default or Event of Default that may exist under the
Financing Agreement or arise after the date hereof or an acquiescence
therein.
Section 2.16 Limited Waiver of Section 8.02(c) of the
----------------------------------------
Financing Agreement. For avoidance of doubt, the Lenders hereby waive
-------------------
compliance by the Loan Parties with the provisions of Section 8.02(c) of the
Financing Agreement on a retroactive basis to the extent that such section
would prohibit the wind-down of the Chlorobenzene Business. Such waiver does
not constitute a waiver of Section 8.02(c) of the Financing Agreement as
amended herein, any other provision of the Financing Agreement or any other
Loan Document or any waiver of any other Default or Event of Default that
may exist under the Financing Agreement or an acquiescence therein.
Section 2.17 Limited Waiver of Section 8.02(e) of the
----------------------------------------
Financing Agreement. For avoidance of doubt, the Lenders hereby waive
-------------------
compliance by the Loan Parties with the provisions of Section 8.02(e) of the
Financing Agreement on a retroactive basis to the extent that such section
would prohibit execution of a sale agreement containing earnout provisions.
Such waiver does not constitute a waiver of Section 8.02(e) of the Financing
Agreement as amended herein, any other provision of the Financing Agreement
or any other Loan Document or any waiver of any other Default or Event of
Default that may exist under the Financing Agreement or arise after the date
hereof or an acquiescence therein.
Section 2.18 Limited Waiver of Sections 8.02(j), 8.02(o),
--------------------------------------------
8.02(r), and 9.04 of the Financing Agreement. For avoidance of doubt, the
--------------------------------------------
Lenders hereby waive compliance by the Loan Parties with the provisions of
Sections 8.02(j), 8.02(o), 8.02(r), and 9.04 of the Financing Agreement on a
retroactive basis to the extent that such sections would prohibit the
deferral of payments arising in the ordinary course of business under the
Astaris Operating Agreement. Such waiver does not constitute a waiver of
Sections 8.02(j), 8.02(o), 8.02(r), and 9.04 of the Financing Agreement as
amended herein, any other provision of the Financing Agreement or any other
Loan Document or any waiver of any other Default or Event of Default that
may exist under the Financing Agreement or an acquiescence therein.
Section 2.19 Limited Waiver of Section 8.02(t) of the
----------------------------------------
Financing Agreement. For avoidance of doubt, the Lenders hereby waive
-------------------
compliance by the Loan Parties with the provisions of Section 8.02(t) of the
Financing Agreement on a retroactive basis to the extent that such section
would prohibit payments in respect of prepetition obligations owed to each
of Xxxxx Fargo, N.A., The Business Bank of St. Louis, JPMorgan Chase Bank,
and HSBC Bank USA that are fully secured or supported by cash
16
collateral or letter of credit obligations of the Loan Parties. Such waiver
does not constitute a waiver of Section 8.02(t) of the Financing Agreement
as amended herein, any other provision of the Financing Agreement or any
other Loan Document or any waiver of any other Default or Event of Default
that may exist under the Financing Agreement or arise after the date hereof
or an acquiescence therein.
Section 2.20 Limited Waiver of Section 9.01(a) of the
----------------------------------------
Financing Agreement. For avoidance of doubt, the Lenders hereby waive
-------------------
compliance by the Loan Parties with the provisions of Section 9.01(a) of the
Financing Agreement on a retroactive basis to the extent that such section
would require delivery of Cash Management Agreements and Concentration
Account Agreements on or prior to the Facility Effective Date. Such waiver
does not constitute a waiver of Section 9.01(a) of the Financing Agreement
as amended herein, any other provision of the Financing Agreement or any
other Loan Document or any waiver of any other Default or Event of Default
that may exist under the Financing Agreement or arise after the date hereof
or an acquiescence therein.
Section 2.21 Limited Waiver of Section 9.01(c) of the
----------------------------------------
Financing Agreement. For avoidance of doubt, the Lenders hereby waive
-------------------
compliance by the Loan Parties with the provisions of Section 9.01(c) of the
Financing Agreement on a retroactive basis to the extent that such section
would require (A) amendment of Schedule 9.01 to add those accounts not
-------------
already reflected on such schedule and (B) prior to the time of opening of
such accounts, execution and delivery of a Cash Management Agreement. Such
waiver does not constitute a waiver of Section 9.01(c) of the Financing
Agreement as amended herein (including amendments to Schedule 9.01), any
-------------
other provision of the Financing Agreement or any other Loan Document or any
waiver of any other Default or Event of Default that may exist under the
Financing Agreement or arise after the date hereof or an acquiescence
therein.
ARTICLE III
CONDITIONS PRECEDENT
Section 3.01 Conditions to Effectiveness of this
-----------------------------------
Amendment. This Amendment shall be effective as of the date hereof, upon the
---------
satisfaction of the conditions precedent that:
(a) Amendment. The Administrative Agent shall
---------
have received executed counterparts of this Amendment, duly executed by
Lenders constituting at least Supermajority Consent, the Borrowers, each
Guarantor, the Documentation Agent, the Administrative Agent, the Collateral
Agent and the Issuer.
(b) Representations and Warranties. As of the
------------------------------
date hereof, both before and after giving effect to this Amendment, all of
the representations and warranties contained in the Financing Agreement and
in each other Loan Document shall be true and correct in all material
respects as though made on the date hereof (and by its execution hereof, the
Borrowers shall be deemed to have represented and warranted such).
17
(c) Fees. The Borrowers shall have paid the fees
----
referred to in Section 4.05.
(d) No Default. As of the date hereof, both
----------
before and after giving effect to this Amendment, no Default (other than
with respect to the provisions of Sections 6.01(n), 8.02(c), 8.02(e),
8.02(j), 8.02(l), 8.02(o), 8.02(r), 8.02(t), 9.01(a), 9.01(c), and 9.04 of
the Financing Agreement that would, upon effectiveness of this Amendment, be
waived pursuant to Sections 2.15 through 2.21 above) shall have occurred and
be continuing (and by its execution hereof, the Borrowers shall be deemed to
have represented and warranted such).
(e) Bankruptcy Court Order. An order of the
----------------------
Bankruptcy Court approving this Amendment and the terms and conditions
hereof, such order to be in form and substance satisfactory to the
Administrative Agent in its sole discretion, shall have been entered by the
Bankruptcy Court, the Administrative Agent shall have received a true and
complete copy of such order, and such order shall be in full force and
effect and shall not have been reversed, modified, amended, stayed or
vacated absent prior written consent of the Administrative Agent.
ARTICLE IV
MISCELLANEOUS
Section 4.01 Effect; Ratification. The amendments and
--------------------
waivers set forth herein are effective solely for the purposes set forth
herein and shall be limited precisely as written, and shall not be deemed to
(i) be a consent to, or acknowledgment of, any amendment, waiver or
modification of any other term or condition of the Financing Agreement or of
any other instrument or agreement referred to therein or (ii) prejudice any
right or remedy which the Agents or any other party may now have or may have
in the future under or in connection with the Financing Agreement as amended
hereby or any other instrument or agreement referred to therein. This
Amendment shall be construed in connection with and as part of the Financing
Agreement, and all terms, conditions, representations, warranties, covenants
and agreements set forth in the Financing Agreement and each other
instrument or agreement referred to therein, except as herein amended, are
hereby ratified and confirmed and shall remain in full force and effect.
Section 4.02 Due Authorization; Authority; No Conflicts;
-------------------------------------------
Enforceability. The execution, delivery and performance by each Loan Party
--------------
of this Amendment (i) have been duly authorized by all necessary action,
(ii) do not and will not contravene its charter or by-laws, its limited
liability company or operating agreement or its certificate of partnership
or partnership agreement, as applicable, or any applicable law or any
contractual restriction binding on or otherwise affecting it or any of its
properties (other than conflicts, breaches and defaults, the enforcement of
which will be stayed by virtue of the filing of the Chapter 11 Cases), or
any order or decree of any court or Governmental Authority (including,
without limitation, any order entered in the Chapter 11 Cases), (iii) do not
and will not result in or require the creation of any Lien
18
upon or with respect to any of its material properties, and (iv) do not and
will not result in any material default, noncompliance, suspension,
revocation, impairment, forfeiture or nonrenewal of any material permit,
license, authorization or approval applicable to its operations or any of
its properties. Other than the order referred to in Section 3.01(e) hereof,
no authorization or approval or other action by, and no notice to or filing
with, any Governmental Authority, including the Bankruptcy Court, is
required in connection with the due execution, delivery and performance by
any Loan Party of this Amendment. This Amendment, when delivered hereunder,
is or will be, duly and validly executed and delivered by each of the Loan
Parties which is a party hereto and each of this Amendment and the Financing
Agreement as amended hereby constitutes the legal, valid and binding
obligation of each of the Loan Parties which is a party hereto or thereto,
enforceable in accordance with the terms hereof or thereof.
Section 4.03 No Novation. Neither this Amendment nor the
-----------
replacement of the terms of the Financing Agreement by the terms of this
Amendment shall extinguish the obligations for the payment of money
outstanding under the Financing Agreement or discharge or release the Lien
or priority of any security agreement, any pledge agreement or any other
security therefor. Nothing herein contained shall be construed as a
substitution or novation of the Obligations outstanding under the Financing
Agreement or instruments securing the same, which shall remain in full force
and effect, except as modified hereby. Nothing expressed or implied in this
Amendment or any other document contemplated hereby or thereby shall be
construed as a release or other discharge of the Borrowers or any other Loan
Party under any Loan Document from any of its obligations and liabilities
thereunder. Each of the Financing Agreement and the other Loan Documents
shall remain in full force and effect, until and except as modified hereby
or in connection herewith. This Amendment is a Loan Document executed
pursuant to the Financing Agreement and shall be construed, administered and
applied in accordance with the terms and provisions thereof.
Section 4.04 Costs, Fees and Expenses. The Borrowers
------------------------
jointly and severally agree to reimburse the Agents and the Lenders upon
demand for all costs, fees and expenses (including the reasonable fees and
expenses of counsel to the Agents and the Lenders) incurred in connection
with the preparation, execution and delivery of this Amendment.
Section 4.05 Amendment Fees. The Borrowers jointly and
--------------
severally agree to pay to the Administrative Agent (a) for the pro rata
benefit of each Lender who approves this Amendment an amendment fee of 12.5
basis points, and (b) such other fees as are agreed to separately by the
Borrowers and the Administrative Agent with respect to this Amendment, which
amendment fee and other fees shall be fully earned upon the effectiveness
hereof and nonrefundable when paid, and are in addition to any and all other
fees required to be paid from time to time by the Borrowers under the
Financing Agreement.
Section 4.06 Counterparts. This Amendment may be executed
------------
in any number of counterparts and by different parties hereto in separate
counterparts, each of which shall be deemed to be an original, but all of
which taken together shall constitute
19
one and the same agreement. Delivery of an executed counterpart of this
Amendment by telecopier shall be equally as effective as delivery of an
original executed counterpart of this Amendment. Any party delivering an
executed counterpart of this Amendment by telecopier also shall deliver an
original executed counterpart of this Amendment but the failure to deliver
an original executed counterpart shall not affect the validity,
enforceability, and binding effect of this Amendment.
Section 4.07 Severability. Any provision of this Amendment
------------
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining portions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 4.08 CHOICE OF LAW. THIS AMENDMENT SHALL BE
-------------
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW
YORK EXCEPT AS GOVERNED BY THE BANKRUPTCY CODE.
Section 4.09 No Party Deemed Drafter. Each of the parties
-----------------------
hereto agrees that no party hereto shall be deemed to be the drafter of this
Amendment.
Section 4.10 Ratification of Guaranty. Each Guarantor
------------------------
hereby consents to this Amendment and hereby confirms and agrees that (a)
notwithstanding the effectiveness of this Amendment, the Guaranty is, and
shall continue to be, in full force and effect and is hereby ratified and
confirmed in all respects, except that, on and after the effectiveness of
this Amendment, each reference in the Guaranty to the "Agreement",
"thereunder", "thereof" or words of like import referring to the Financing
Agreement shall mean and be a reference to the Financing Agreement as
amended by this Amendment, and (b) the Loan Documents to which it is a party
and all of the Collateral described therein do, and shall continue to,
secure the payment of all of the Obligations secured thereby.
(Signature Page Follows)
20
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
BORROWERS:
---------
SOLUTIA INC., as a debtor and a
debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Treasurer
SOLUTIA BUSINESS ENTERPRISES, INC.,
as a debtor and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
GUARANTORS:
----------
AXIO RESEARCH CORPORATION, as a
debtor and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
XXXXXX ROAD MANAGEMENT COMPANY, as a
debtor and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
CPFILMS INC., as a debtor and a
debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Assistant
Treasurer
MONCHEM, INC., as a debtor and a
debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
MONCHEM INTERNATIONAL, INC., as a
debtor and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
SOLUTIA GREATER CHINA, INC., as a
debtor and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
SOLUTIA INTER-AMERICA, INC., as a
debtor and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
SOLUTIA INTERNATIONAL HOLDING, LLC,
as a debtor and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
SOLUTIA INVESTMENTS, LLC, as a debtor
and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
SOLUTIA MANAGEMENT COMPANY, INC., as
a debtor and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
SOLUTIA OVERSEAS, INC., as a debtor
and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
SOLUTIA SYSTEMS, INC., as a debtor
and a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
SOLUTIA TAIWAN, INC., as a debtor and
a debtor-in-possession
By: /s/ Xxxxx X. Xxxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President & Treasurer
ADMINISTRATIVE AGENT, COLLATERAL AGENT,
---------------------------------------
CO-DOCUMENTATION AGENT AND A LENDER:
-----------------------------------
CITICORP USA, INC., for itself as the
Administrative Agent, the Collateral
Agent, a Co-Documentation Agent and a
Lender
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
Title: Vice President
CO-DOCUMENTATION AGENT AND A LENDER:
-----------------------------------
XXXXX FARGO FOOTHILL, LLC, for itself
as a Co-Documentation Agent and a
Lender
By: /s/ Xxx Xxxx
-------------------------------------
Name: Xxx Xxxx
Title: Vice President
ISSUER:
------
CITIBANK, N.A., as an Issuer and a
Lender
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
Title: Vice President
LENDER:
------
CITIGROUP GLOBAL MARKETS INC., as a
Lender
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
Title: Authorized Signer
LENDER:
------
CITIGROUP FINANCIAL PRODUCTS INC.,
as a Lender
By: /s/ Xxx Xxx
-------------------------------------
Name: Xxx Xxx
Title: Authorized Signatory
LENDER:
------
XXX CAPITAL FUNDING L.P.
By: Highland Capital Management, L.P.
As Collateral Manager, as a Lender
By: /s/ Xxxx Xxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxx
Title: Senior Portfolio Manager
Highland Capital Management,
L.P.
LENDER:
------
BANK OF AMERICA, N.A., as a Lender
By: /s/ Xxx Xxxxxxx
-------------------------------------
Name: Xxx Xxxxxxx
Title: AVP
LENDER:
------
HIGHLAND LEGACY LIMITED
By: Highland Capital Management, L.P.
As Collateral Manager, as a Lender
By: /s/ Xxxx Xxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxx
Title: Senior Portfolio Manager
Highland Capital Management,
L.P.
LENDER:
------
HIGHLAND LOAN FUNDING V LTD.
By: Highland Capital Management, L.P.
As Collateral Manager, as a Lender
By: /s/ Xxxx Xxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxx
Title: Senior Portfolio Manager
Highland Capital Management,
L.P.
LENDER:
------
RESTORATION FUNDING CLO, LTD.
By: Highland Capital Management, L.P.
As Collateral Manager, as a Lender
By: /s/ Xxxx Xxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxx
Title: Senior Portfolio Manager
Highland Capital Management,
L.P.
LENDER:
------
CALIFORNIA PUBLIC EMPLOYEES
RETIREMENT SYSTEM
By: Highland Capital Management, L.P.
As Authorized Representatives of
the Board, as a Lender
By: /s/ Xxxx Xxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxx
Title: Senior Portfolio Manager
Highland Capital Management,
L.P.
LENDER:
------
AMARANTH LLC, as a Lender
By:
-------------------------------------
Name:
Title:
LENDER:
------
SATELLITE SENIOR INCOME FUND, LLC, as
a Lender
By: /s/ Xxxx Xxxxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxxxx
Title: Principal
LENDER:
------
SATELLITE SENIOR INCOME FUND II, LLC,
as a Lender
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Principal, Satellite Asset
Management
LENDER:
------
OZ SPECIAL MASTER FUND, LTD., as a
Lender
By: OZ Management, LLC
As Investment Manager
By: /s/ Xxxxxx X. Och
-------------------------------------
Name: Xxxxxx X. Och
Title: Senior Managing Member
LENDER:
------
PERRY PRINCIPALS INVESTMENTS, LLC, as
a Lender
By: /s/ Xxxx Xxxx
-------------------------------------
Name: Xxxx Xxxx
Title:
LENDER:
------
XXXXXXX CAPITAL LTD., as a Lender
By: Citadel Limited Partnership, its
Portfolio Manager
By: GLB Partners, L.P., its General
Partner
By: Citadel Investment Group, L.L.C.,
its General Partner
By: /s/ Xxxxx X. Xxxxx
-------------------------------------
Name: Xxxxx X. Xxxxx
Title: Managing Director
LENDER:
------
BAYERISCHE HYPO-UND VEREINSBANK AG,
NEW YORK BRANCH, as a Lender
By: /s/ Xxxxxx Xxxxxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Associate Director
By: /s/ Xxxxxxxxx Xxxxxxxx
-------------------------------------
Name: Xxxxxxxxx Xxxxxxxx
Title: Managing Director
LENDER:
------
SHEPHERD INVESTMENTS INTERNATIONAL,
LTD., as a Lender
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: General Counsel
LENDER:
------
TCW SELECT LOAN FUND, LIMITED
By: TCW Advisors, Inc, as its
Collateral Manager
By: /s/ G. Xxxxxx Xxxxx
-------------------------------------
Name: G. Xxxxxx Xxxxx
Title: Senior Vice President
By: /s/ Xxxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Managing Director
LENDER:
------
C-SQUARED CDO LTD.
By: TCW Advisors, Inc, as its
Portfolio Manager
By: /s/ Xxxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Managing Director
By: /s/ G. Xxxxxx Xxxxx
-------------------------------------
Name: G. Xxxxxx Xxxxx
Title: Senior Vice President
LENDER:
------
LOAN FUNDING I LLC, a wholly owned
subsidiary of Citibank, N.A.
By: TCW Advisors, Inc, as Portfolio
Manager of Loan Funding ILLC
By: /s/ Xxxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Managing Director
By: /s/ G. Xxxxxx Xxxxx
-------------------------------------
Name: G. Xxxxxx Xxxxx
Title: Senior Vice President
LENDER:
------
UBS AG STAMFORD BRANCH, as a Lender
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Executive Director
Banking Products Services, US
By: /s/ Xxxxxxxx X. Saint
-------------------------------------
Name: Xxxxxxxx X. Saint
Title: Director
Banking Products Services, US
