AMENDED AND RESTATED FOURTH AMENDMENT AND WAIVER (the "Fourth Amendment and
Waiver") dated as of March 31, 1997 to the Letter of Credit, Reimbursement and
Loan Agreement dated as of June 28, 1995, as amended by the First Amendment and
Waiver dated as of March 5, 1996, the Second Amendment and Waiver dated as of
July 23, 1996 and the Third Amendment and Waiver dated as of February 7, 1997
(the "Agreement") by and between Foilmark Manufacturing Corporation (the
"Company") and The Chase Manhattan Bank (formerly known as Chemical Bank) (the
"Bank")
WHEREAS, the Company has requested and the Bank has agreed, subject to the terms
and conditions of this FOURTH AMENDMENT AND WAIVER, to amend and waive the
Agreement to reflect the requests set forth herein;
NOW, THEREFORE, in consideration of the premises and of the mutual agreements
herein contained, the parties hereto agree as follows:
1. Waiver of ARTICLE II, Letter of Credit and Loans, Section 2.02, Debt
Service Account; Reimbursement.
Compliance with Section 2.02. (a) of the Agreement is hereby waived for
the period commencing July 1, 1996 through and including the date hereof
solely to the extent necessary to permit the non-receipt by the Bank
during such period of the Aggregate amount of monthly sinking fund
payments required to be made by the Company into the Debt Service Account
maintained at the Bank, in the amount of $300,000, provided, however, that
the Company makes a cumulative payment, no later than April 30, 1997, in
the amount of $148,143.29 into the Debt Service Account maintained at the
Bank. As of the date hereof, the Company has made sinking fund payments
into the Debt Service Account maintained at the Bank in the aggregate
amount of $151,856.71.
2. Waiver of ARTICLE V, AFFIRMATIVE COVENANTS, SECTION 5.03, Financial
Statemens, Reports
Compliance with Section 5.03.(a) of the Agreement is hereby waived for the
fiscal year ended December 31, 1996 to permit the late receipt by the Bank
of the audited consolidated financial statements of Foilmark and its
Subsidiaries for such fiscal year and the unaudited consolidating
financial statements of Foilmark and its Subsidiaries for such fiscal
year, which were to be delivered to the Bank on or before March 31, 1997
provided, however, such financial statements are received by the Bank no
later than April 15, 1997.
Compliance with Section 5.03.(c) of the Agreement is hereby waived for the
fiscal year ended December 31, 1996 to permit the late receipt by the Bank
of the certificate of non-default relating to such fiscal year, prepared
and signed by the Auditor and the Chief Financial Officer of Foilmark and
each of its Subsidiaries, which was to be delivered to the Bank on or
before March 31, 1997 provided, however, such certificate is delivered to
the Bank no later than April 15, 1997.
3. Waiver of ARTICLE VI, NEGATIVE COVENANTS, SECTION 6.01 Liens.
Compliance with Section 6.01. of the Agreement is hereby waived to permit
Kensol-Olsenmark, Inc., a New York corporation and Kensol-Olsenmark, Inc.,
a Delaware corporation to have granted a first mortgage lien on certain
real property owned by each of such entities respectively and located at
00 Xxxxxxxx Xxxx Xxxx, Xxxxxxxx, Xxx Xxxx and 000 Xxxxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxxxxxxx, respectively, solely to secure a guaranty
delivered to Fleet National Bank by each such entity on December 16, 1996
of certain Indebtedness owing by Foilmark, Inc. to Fleet National Bank in
the original principal amount of $1,997,500 and funded on December 16,
1996.
4. Waiver of ARTICLE VI. NEGATIVE COVENANTS, SECTION 6.02. Indebtedness
Compliance with Section 6.02. of the Agreement is hereby waived to permit
Foilmark, Inc. to incur Indebtedness from Fleet National Bank pursuant to
a Commercial Term Loan Agreement and Commercial Term Promissory Note
entered into on December 16, 1996 with respect to a ten (10) year term
loan in the original principal amount of $1,997,500, payable in
consecutive quarterly installments of $33,291.66 each, commencing March
16, 1997, with the then outstanding balance of such term loan due and
payable in full on December 16, 2006.
5. Waiver of ARTICLE VI. NEGATIVE COVENANTS, SECTION 6.04. Guarantees.
Compliance with Section 6.04. of the Agreement is hereby waived to permit
Kensol-Olsenmark, Inc., a New York corporation and Kensol-Olsenmark, Inc.,
a Delaware corporation to have guaranteed certain Indebtedness of
Foilmark, Inc. owing to Fleet National Bank pursuant to a Commercial Term
Loan Agreement and Commercial Term Promissory Note entered into on
December 16, 1996 with respect to a ten (10) year term loan in the
original principal amount of $1,997,500, payable in consecutive quarterly
installments of $33,291.66 each, commencing March 16, 1997, with the then
outstanding balance of such term loan due and payable in full on December
16, 2006.
6. Waiver of ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.09. Leases.
Compliance with Section 6.09. of the Agreement is hereby waived for the
fiscal year ended December 31, 1996 to permit the aggregate amount of all
rents paid by the Company and its Affiliates under operating leases to
exceed $400,000 during such fiscal year provided, however, the aggregate
amount of all such rents paid during such fiscal year was not in excess of
$438,000.
7. Waiver of ARTICLE VI. NEGATIVE COVENANTS, SECTION 6.14. Consolidated
Tangible Net Worth plus Consolidated Subordinated Debt.
Compliance with Section 6.14 of the Agreement is hereby waived for the
fiscal year ended December 31, 1996 to permit the Consolidated Tangible
Net Worth plus Consolidated Subordinated Debt to be less than $13,892,000
as of such fiscal year end provided, however, the Consolidated Tangible
Net Worth plus Consolidated Subordinated Debt was not less than
$12,949,000 as of such fiscal year end.
8. Waiver of ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.15. Consolidated Debt
Service Coverage Ratio.
Compliance with Section 6.15. of the Agreement is hereby waived for the
fiscal year ended December 31, 1996 to permit the Consolidated Debt
Service Coverage Ratio to be less than 1.25 to 1.0 as of such fiscal year
end provided, however, the Consolidated Debt Service Ratio was not less
than 0.68 to 1.0 as of such fiscal year end.
9. Waiver of ARTICLE VI. NEGATIVE COVENANTS, SECTION 6.17. Consolidated
Capital Expenditures.
Compliance with Section 6.17. of the Agreement is hereby waived for the
fiscal year ended December 31, 1996 to permit the Consolidated Capital
Expenditures of Foilmark and its Subsidiaries to be greater than $600,000
during such fiscal year provided, however, the Consolidated Capital
Expenditures of Foilmark and its Subsidiaries during such fiscal year was
not in excess of $2,330,000.
10. Waiver of ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.18. Total
Unsubordinated Liabilities to Consolidated Tangible Net Worth plus
Consolidated Subordinated Debt.
Compliance with Section 6.18. of the Agreement is hereby waived for the
fiscal year ended December 31, 1996 to permit the ratio of Consolidated
Total Unsubordinated Liabilities to Consolidated Tangible Net Worth plus
Consolidated Subordinated Debt to be greater than 1.50 to 1.0 as of such
fiscal year end provided, however, such ratio was not greater than 1.64 to
1.0 as of such fiscal year end.
11. Amendment to ARTICLE II, LETTER OF CREDIT AND LOANS. SECTION 2.02. Debt
Service Account, Reimbursement, (a).
Section 2.02. (a) of the Agreement is hereby amended by adding the
following sentence to the end thereof as follows:
"The Bank shall directly charge all such monthly installments due pursuant
to this Section to the Company's (i.e.: Foilmark Manufacturing
Corporation's) account number 893-105171 or one or more other accounts of
the Company at the Payment Office or other office of the Bank commencing
April 1, 1997."
12. Amendment to ARTICLE V. AFFIRMATIVE COVENANTS, SECTION 5.03. Financial
Statements, Reports.
Section 5.03. of the Agreement is hereby amended by (1) deleting the word
"and" at the end of subsection (f) thereof, (2) re-designating subsection
(g) thereof as subsection (h) and (3) adding a new subsection (g) as
follows:
"(g) (1) promptly provide to the Bank copies of all material pleadings,
motions and other filings made by any party with respect to the
Proceedings (which shall mean the pending litigation outlined in the
letter dated July 1, 1996 from Xxxxxxxx, Xxxxx & Xxxxxx, counsel to the
Company and its affiliates, to the Bank, as updated by letters to the Bank
from Xxxxxxxx, Xxxxx & Xxxxxx on October 23, 1996, January 15, 1997 and
March 15, 1997 and all other litigation or proceedings to which the
Company or any of its affiliates are a party which arise out of the
incident which is the basis for the foregoing pending litigation) promptly
after receipt thereof and promptly notify the Bank of any change in the
status of the Proceedings including any decision or orders of the count in
which such Proceedings are held and (2) provide a detailed update of the
Proceedings from counsel to the Company and its affiliates, addressed to
the Bank, on the 15th day of each month commencing April 15, 1997.
13. Amendment to ARTICLE V. AFFFIRMATIVE COVENANTS.
Article V. of the Agreement is hereby amended by adding a new SECTION 5.18
as follows:
"SECTION 5.18. Proceedings. Cause the counsel to the Company and its
affiliates with respect to the Proceedings (as defined in Section
5.03. (g) hereof) to be available for conferences with respect to
the status of the Proceedings from time to time at the request of
the Bank."
14. Amendment to ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.01. Liens.
Section 6.01. of the Agreement is hereby amended by deleting the work
"and" at the end of subsection (d) thereof, deleting the period at the end
of subsection (e) thereof and substituting therefor the phrase "; and" and
inserting a new subsection "(f)" as follows:
"(f) (1) in the case of Kensol-Olsenmark, Inc., a New York
corporation, a first mortgage Lien granted to Fleet National Bank
covering real property located at 00 Xxxxxxxx Xxxx Xxxx, Xxxxxxxx,
Xxx Xxxx to secure a guaranty issued by such entity to Fleet
National Bank on December 16, 1996 as permitted in Section 6.04 (e)
(1) hereof and (2) in the case of Kensol-Olsenmark, Inc., a Delaware
corporation, a first mortgage Lien granted to Fleet National Bank
covering real property located at 000 Xxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxxxxxxx solely to secure a guaranty issued by such entity to
Fleet National Bank on December 16, 1996 as permitted in Section
6.04 (e) (2) hereof, but not including any renewals or extensions of
such mortgage Liens."
15. Amendment to ARTICLE VI. NEGATIVE COVENANTS SECTION 6.02 Indebtedness,
Section 6.02 (h) of the Agreement is hereby amended by deleting the date
"March 31, 1997" contained therein and substituting therefor the date
"April 30, 1997".
Section 6.02 of the Agreement is hereby further amended by deleting the
word "and" at the end of subsection (g) contained therein, deleting the
period at the end of subsection (h) contained therein and substituting
therefor the phrase "; and: and inserting a new subsection "(i)" and a new
subsection "(j)" as follows:
"(i) Unsecured Indebtedness owing by Foilmark, Inc. to Fleet
National Bank under a $6,000,000 revolving credit facility provided
such facility shall expire and all such Indebtedness be repaid to
Fleet National Bank no later than June 30, 1998; and
(j) Indebtedness owing by Foilmark, Inc. to Fleet National Bank pursuant
to a Commercial Term Loan Agreement and Commercial Term Promissory
Note entered into on December 16, 1996 with respect to a ten (10)
year term loan in the original principal amount of $1,997,500,
payable in consecutive quarterly installments of $33,291.66 each,
commencing March 16, 1997, with the then outstanding balance of such
term loan due and payable in full on December 16, 2006, but not
including any renewals, amendments, extensions or modifications
thereof."
16. Amendment to ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.04. Guarantees.
Section 6.04. of the Agreement is hereby amended by deleting the word
"and" at the end of subsection (c ) thereof, deleting the period at the
end of subsection (d) thereof and substituting therefor the phrase "; and"
and inserting a new subsection "(e)" as follows:
"(e) (1) in the case of Kensol-Olsenmark, Inc., a New York
corporation, a guaranty dated December 16, 1996 of certain
Indebtedness of Foilmark, Inc. owing to Fleet National Bank as
permitted pursuant to Section 6.02. (j) hereof and (2) in the case
of Kensol-Olsenmark, Inc., a Delaware corporation, a guaranty dated
December 16, 1996 of certain Indebtedness of Foilmark, Inc. owing to
Fleet National Bank as permitted pursuant to Section 6.02. (j)
hereof, but not including any renewals, amendments, extensions or
modifications thereof of such guarantys."
17. Amendment to ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.09. Leases.
Section 6.09. of the Agreement is hereby amended by deleting the number
"$400,000" contained therein and substituting therefor the number
"$500,000".
18. Amendment to ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.14.
Consolidated Tangible Net Worth plus Consolidated Subordinated Debt.
Section 6.14 of the Agreement is hereby amended by deleting it in its
entirety and substituting the following therefor:
"SECTION 6.14. Consolidated Tangible Net Worth plus Consolidated
Subordinated Debt. Permit Consolidated Tangible Net Worth plus
Consolidated Subordinated Debt ("TNW"), at any time to be less than
the amount set forth below opposite the relevant period:
Period Amount
December 31, 1996 through June 29, 1997 $12,700,000
June 30, 1997 through December 30, 1997 $13,000,000
December 31, 1997 through December 30, 1998 The greater of (a) $13,500,000
and (b) the actual TNW as of
December 31, 1997
and for each comparable thereafter, commencing December 31 through
and including December 30 of the following year, an amount not less
than the actual Consolidated Tangible Net Worth plus Consolidated
Subordinated Debt as of the immediately prior December 31 plus
$500,000."
19. Amendment to ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.15 Consolidated
Debt Service Coverage Ratio.
Section 6.15 of the Agreement is hereby amended by deleting it in its
entirety and substituting therefor the following:
"SECTION 6.15. Consolidated Debt Service Coverage Ratio. Permit the
Consolidated Debt Service Coverage Ratio to be less 0.68 to 1.0 at any
time from December 31, 1996 through March 30, 1997; 0.09 to 1.0 at any
time from March 31, 1997 to December 30, 1997 and 1.25 to 1.0 at any time
from December 31, 1997 and thereafter."
20. Amendment to ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.17. Consolidated
Capital Expenditures.
Section 6.17. of the Agreement is hereby amended by deleting such section
in its entirety and substituting therefor the following:
"SECTION 6.17. Consolidated Capital Expenditures. Permit Consolidated
Capital expenditures (including, without limitation, obligations under
Finance Leases) of Foilmark and its Subsidiaries to be greater than
$700,000 in any fiscal year."
21. Amendment to ARTICLE VI. NEGATIVE COVENANTS. SECTION 6.18. Total
Unsobordinated Liabilities to Consolidated Tangible Net Worth plus
Consolidated Subordinated Debt.
Section 6.18 of the Agreement is hereby amended by deleting it in its
entirety and substituting therefor the following:
"SECTION 6.18. Total Unsubordinated Liabilities to Consolidated
Tangible Net Worth plus Consolidated Subordinated Debt. Permit the
ratio of Consolidated Total Unsubordinated Liabilities to
Consolidated Tangible Net Worth plus Consolidated Subordinated Debt
to be greater than (1) 1.67 to 1.0 at any time from December 31,
1996 through December 30, 1997 and (2) 1.50 to 1.0 at any time from
December 31, 1997 and thereafter."
22. Amendment to ARTICLE VII. EVENTS OF DEFAULT. SECTION 7.01. Events of
Default (a).
Section 7.01. (a) of the Agreement is hereby amended by deleting it in its
entirety and substituting therefor the following:
"(a) (i) failure to pay the principal of any Loan as and when due
and payable, (ii) failure to make any payment into the Debt Service
Account required hereunder pursuant to Section 2.02. (a) as and when
due and payable, (iii) failure to make any reimbursement required
hereunder as and when due and payable, or (iv) failure to pay any
interest on any Loan or any Letter of Credit Fee or any other fees
payable under this Agreement as and when due and payable if such
failure shall continue unremedied for a period of five days (with
respect to (iv) only);"
This FOURTH AMENDMENT AND WAIVER shall be construed and enforced in accordance
with the laws of the State of New York.
Capitalized terms used herein and not otherwise defined herein shall have the
same meanings as defined in the Agreement.
Except as expressly amended or consented to hereby, the Agreement shall remain
in full force and effect in accordance with the original terms thereof and is
ratified and confirmed. Without limiting the foregoing, the Company hereby
acknowledges that it is and will continue to be bound by the restrictions
contained in Section 6.01. of the Agreement which prohibit the Company and its
Affiliates from granting any mortgage, pledge, assignment, security interest,
lien, charge or any other encumbrance of any nature whatsoever on any of its
assets now or hereafter owned other than to the extent permitted in Section
6.01. of the Agreement.
The agreements herein contained are limited specifically to the matters set
forth above and do not constitute directly or by implication an amendment or
waiver of any other provision of the Agreement or any default or Event of
Default which may occur or may have occurred under the Agreement.
The Company hereby represents and warrants that, after giving effect to this
FOURTH AMENDMENT AND WAIVER, no Event of Default or default exists under the
Agreement or any other related document.
Please be advised that should there be a need for further amendments or waivers
with respect to these covenants or any other covenants, those requests shall be
evaluated by the Bank when formally requested, in writing, by the Company.
This FOURTH AMENDMENT AND WAIVER may be executed in one or more counterparts,
each of which shall constitute an original, but all of which when taken together
shall constitute but one FOURTH AMENDMENT AND WAIVER. This FOURTH AMENDMENT AND
WAIVER shall become effective upon the satisfaction, as determined by the Bank
in its sole discretion, of each of the following conditions by no later than
March 31, 1997:
(i) when duly executed counterparts hereof which, when taken together,
bear the signatures of each of the parties hereto shall have been
delivered to the Bank;
(ii) upon the receipt by the Bank of the fully executed Amended and
Restated Fourth Amendment and Waiver dated as of March 31, 1997 to
the Term Loan Agreement dated as of June 28, 1995 by and between
Foilmark Manufacturing Corporation and the Chase Manhattan Bank, as
amended;
(iii) upon receipt and satisfactory review by the Bank of amendments and
waivers as to the matters set forth above, as applicable, to the
Commercial Term Loan Agreement dated December 16, 1996 between Fleet
National Bank and Foilmark, Inc.;
(iv) upon the receipt by the Bank of payment in full of all Obligations
(as such term is defined in the Credit Agreement dated as of June
28, 1995, as amended, by and between Foilmark, Inc., Foilmark
Manufacturing Corporation, Kensol-Olsenmark, Inc., West Foils, Inc.,
Imtran Foilmark, Inc., and The Chase Manhattan Bank and Fleet
National Bank of Massachusetts, N.A. (the "Revolving Credit
Agreement")) owing to the Bank by the Company and certain of its
affiliates under the Revolving Credit Agreement including, without
limitation, all principal amounts outstanding, all accrued and
unpaid interest and any other amounts owing pursuant to Section
2.08. (b), Section 2.08. (c) and Section 2.13. of the Revolving
Credit Agreement and cancellation of the Bank's Revolving Credit
Commitment;
(v) upon the execution of an intercreditor agreement by the Bank and
Fleet National Bank, in form and substance satisfactory to the Bank
in all respects, with regard to certain loans owing by the Company
and/or certain of its affiliates to certain individuals which are
currently subordinated by such individuals to (1) indebtedness owing
to the Bank and Fleet National Bank under the Revolving Credit
Agreement and (2) certain other indebtedness owing by the Company
and its affiliates to the Bank;
(vi) upon the receipt by the Bank for its own account of an amendment fee
in the amount of $500; and
(vii) upon payment in full by the Borrower of the legal fees and expenses
of the Bank's outside counsel in connection with the preparation of
this Fourth Amendment and Waiver.
In the event that any of the foregoing conditions are not satisfied on or before
April 9, 1997, the amendments and waivers set forth above shall be null and void
and of no force or effect.
IN WITNESS WHEREOF, the Company and the Bank have caused the FOURTH AMENDMENT
AND WAIVER to be duly executed by their duly authorized officers, all as of the
day and year first above written.
FOILMARK MANUFACTURING
CORPORATION
By: /s/ Xxxxxx Xxxxxx
---------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
THE CHASE MANHATTAN BANK
(formerly known as Chemical Bank)
By: /s/ Xxxxxxxxxxx Xxxxxxxxxx
---------------------------
Name: Xxxxxxxxxxx Xxxxxxxxxx
Title: Vice President
CONSENT
The undersigned not parties to the Agreement but each a Corporate Guarantor
under a separate Corporate Guaranty dated as of June 28, 1995, hereby accept and
agree to the terms of the FOURTH AMENDMENT AND WAIVER contained herein and each
of the undersigned hereby acknowledges that it is and will continue to be bound
by the covenants contained in Article V and Article VI of the Agreement which
relate to it including, without limitation, the covenant contained in Section
6.01. of the Agreement which prohibits the Company and its Affiliates from
granting any mortgage, pledge, assignment, security interest, lien, charge or
other encumbrance of any nature whatsoever on any of its assets now or hereafter
owned other than to the extent permitted in Section 6.01. of the Agreement.
FOILMARK, INC.
By: /s/ Xxxxxx Xxxxxx
---------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
KENSOL-OLSENMARK, INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------
Name: Xxxxxx Xxxxxx
Title: Treasurer
WEST FOILS, INC.
By: /s/ Xxxxxx Xxxxxx
---------------------
Name: Xxxxxx Xxxxxx
Title: Treasurer
CONSENT
The undersigned not a party to the Agreement but a Corporate Guarantor under a
separate Corporate Guaranty dated as of August 21, 1995, hereby accepts and
agrees to the terms of the FOURTH AMENDMENT AND WAIVER contained herein and the
undersigned hereby acknowledges that it is and will continue to be bound by the
covenants contained in Article V and Article VI of the Agreement which relate to
it including, without limitation, the covenant contained in Section 6.01. of the
Agreement which prohibits the Company and its Affiliates from granting any
mortgage, pledge, assignment, security interest, lien, charge or other
encumbrance of any nature whatsoever on any of its assets now or hereafter owned
other than to the extent permitted in Section 6.01. of the Agreement.
IMTRAN FOILMARK, INC.
By: /s/ Xxxxxx Xxxxxx
---------------------
Name: Xxxxxx Xxxxxx
Title: Treasurer
