Exhibit 4.21
SEVENTH AMENDMENT
SEVENTH AMENDMENT (this "Amendment"), dated as of September 30, 1998, among
American Pad & Paper Company ("Holdings"), WR Acquisition, Inc. ("WR
Acquisition"), American Pad & Paper Company of Delaware, Inc. (the "Borrower"),
the lending institutions party to the Credit Agreement referred to below (each a
"Bank" and, collectively, the "Banks"), Bank of Tokyo-Mitsubishi Trust Company,
Bank Xxx Xxxxx, X.X., Xxx Xxxx xx Xxxx Xxxxxx and The First National Bank of
Boston, as Co-Agents (the "Co-Agents"), and Bankers Trust Company, as Agent (the
"Agent"). All capitalized terms used herein and not otherwise defined herein
shall have the respective meanings provided such terms in the Credit Agreement.
W I T N E S S E T H:
WHEREAS, Holdings, WR Acquisition, the Borrower, the Banks, the Co-Agents and
the Agent are party to a Credit Agreement, dated as of July 8, 1996 (as amended,
modified and supplemented prior to the date hereof, the "Credit Agreement");
WHEREAS, Holdings, WR Acquisition, the Borrower, the Banks, the Co-Agents and
the Agent are party to a number of amendments, modifications and waivers in
connection with the Credit Agreement, including without limitation the Third
Amendment, dated as of February 6, 1998 (the "Third Amendment"); and WHEREAS,
the Borrower has requested that the Banks provide the amendments, waivers,
consents and agreements provided for herein and the Banks have agreed to provide
such amendments, waivers, consents and agreements on the terms and conditions
set forth herein;
NOW, THEREFORE, it is agreed:
A. Amendments
1. Section 3.03(b) of the Credit Agreement is hereby amended to read in its
entirety as follows:
(b) In addition to any other mandatory commitment reductions pursuant to this
Section 3.03 (but subject to the last sentence of each of Section 3.03(c) and
Section 3.03(g)), the Total Revolving Loan Commitment shall be permanently
reduced on the dates set forth below by the amounts set forth opposite such
dates below:
Date Amount
December 31, 1998 $25,000,000
December 31, 1999 $25,000,000
July 8, 2000 $50,000,000
24
Exhibit 4.21
2. Section 3.03(c) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(c) In addition to any other mandatory commitment reductions pursuant to this
Section 3.03, on the third Business Day after each date on or after the Initial
Borrowing Date on which Holdings or any of its Subsidiaries receives Cash
Proceeds from any Asset Sale (or, in the case of an Asset Sale in which payments
to Holdings or any of its Subsidiaries originate from outside the United States,
within five Business Days after the date of receipt of such Cash Proceeds), the
Total Revolving Loan Commitment shall be permanently reduced by an amount equal
to 100% of the Net Cash Proceeds from such Asset Sale. Each mandatory reduction
pursuant to this Section 3.03(c) shall be applied to reduce future scheduled
reductions pursuant to Section 3.03(b) as follows: (i) first, to reduce in full
the scheduled reduction on July 8, 2000, and (ii) second, in inverse order of
maturity."
3. Section 3.03(d) of the Credit Agreement is hereby amended by deleting the
first parenthetical phrase appearing therein and by inserting in lieu thereof
the following new parenthetical phrase:
"(other than Indebtedness permitted to be incurred pursuant to Section 8.04 as
in effect on the Effective Date, except for Indebtedness incurred under Section
8.04(p) the net cash proceeds of which will be required to be applied to reduce
the Total Revolving Loan Commitment pursuant to this Section 3.03(d))".
4. Section 3.03(e) of the Credit Agreement is hereby amended by deleting the
reference to "50%" contained therein and inserting "100%" in lieu thereof.
5. Section 3.03 of the Credit Agreement is hereby further amended by (a)
redesignating clauses (g) and (h) thereof as clauses (h) and (i), respectively,
and (b) inserting therein immediately following clause (f) thereof the following
new clause (g):
(g) In addition to any other mandatory commitment reductions pursuant to this
Section 3.03, on the 90th day following each fiscal year of Holdings (commencing
with the fiscal year ended December 31, 1999), the Total Revolving Loan
Commitment shall be permanently reduced by an amount equal to 100% of Excess
Cash Flow for such fiscal year. Each mandatory reduction pursuant to this
Section 3.03(g) shall be applied to reduce future scheduled reductions pursuant
to Section 3.03(b) in inverse order of maturity.
6. Section 8.02(d) of the Credit Agreement is hereby amended to read in its
entirety as follows:
(d) the Borrower and its Subsidiaries may sell assets, provided that (x) the
aggregate sale proceeds from all assets subject to such sales pursuant to this
clause (d) shall not exceed $10,000,000 in any fiscal year of the Borrower, (y)
each such asset sale is for at least 85% cash and at fair market value (as
determined in good faith by the Borrower) and (z) the Net Cash Proceeds
therefrom are applied to reduce the Total Revolving Loan Commitment as provided
in Section 3.03(c);.
25
Exhibit 4.21
7. Section 8.02(e) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(e) the Borrower and its Subsidiaries may sell other assets, provided, that the
aggregate sale proceeds from all such asset sales pursuant to this clause (e)
are reinvested within one year following such sale in assets which, in the
reasonable judgment of the Borrower, are useful to the Borrower's business and
do not exceed $250,000 in any fiscal year of the Borrower;".
8. Section 8.02(q) of the Credit Agreement is hereby amended to read in its
entirety as follows:
(q) so long as no Default or Event of Default then exists or would result
therefrom, the Borrower and its Wholly-Owned Subsidiaries may acquire assets or
the capital stock of any Person (any such acquisition permitted by this clause
(q), a (Permitted Acquisition), provided, that(i)no such Permitted Acquisition
shall be consummated without the prior written consent of the Required Banks,
(ii) such Person (or the assets so acquired)was, immediately prior to such
acquisition, engaged(or used) primarily in the business permitted pursuant to
Section 8.01(a),(iii)if such acquisition is structured as a stock acquisition,
then either(A)the Person so acquired becomes a Wholly-Owned Subsidiary of the
Borrower or (B)such Person is merged with and into the Borrower or a
Wholly-Owned Subsidiary of the Borrower(with the Borrower or such Wholly-Owned
Subsidiary being the surviving corporation of such merger), and in any case, all
of the provisions of Section 8.15 have been complied with in respect of such
Person and (iv) any Liens or Indebtedness assumed or issued in connection with
such acquisition are otherwise permitted under Section 8.03 or 8.04, as the case
may be.
9. Section 8.02(u) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(u) the Permitted Sale-Leaseback Transactions shall be permitted so long as (i)
the Net Cash Proceeds therefrom are applied to reduce the Total Revolving Loan
Commitment as provided in Section 3.03(c) and (ii) the lease obligations created
thereby are otherwise permitted under this Agreement;".
10. Section 8.02 of the Credit Agreement is hereby further amended by (a)
deleting the word "and" appearing at the end of clause (x) thereof, (b) deleting
the period at the end of clause (y) thereof and inserting "; and" in lieu
thereof, and (c) inserting at the end thereof the following new clause (z):
"(z) the Borrower and its Subsidiaries may sell the assets listed on Annex X
hereto, in each case provided that (x) each such sale is for at least 85% cash
and at fair market value (as determined in good faith by the Borrower) and (y)
the Net Cash Proceeds therefrom are applied to reduce the Total Revolving Loan
Commitment as provided in Section 3.03(c)."
26
Exhibit 4.21
11. Section 8.04(e) of the Credit Agreement is hereby amended by deleting clause
(ii) (B) contained therein in its entirety and inserting the following clause
(ii) (B) in lieu thereof:
"(B) during any fiscal year of the Borrower thereafter shall not exceed
$15,000,000;".
12. Section 8.04(o) of the Credit Agreement is hereby amended to read in its
entirety as follows:
(o) Indebtedness of Holdings incurred under Permitted Holdings PIK Securities,
provided that (i) such PermittedHoldings PIK Securities are issued in connection
with and asconsideration for a Permitted Acquisition and (ii) the aggregate
outstanding principal amount of Permitted Holdings PIK Securities constituting
Indebtedness, when added to the liquidation preference of Permitted Holdings PIK
Securities constituting preferred stock, shall not exceed $10,000,000 (plus the
amount of interest or accrued dividends, as the case may be, on such Permitted
Holdings PIK Securities paid in kind or through accretion); and". 13. Section
8.06(f) of the Credit Agreement is hereby amended by adding the following phrase
at the end thereof:
", provided, that no loan may be made pursuant to this clause (ii) after
September 15, 1998".
14. Section 8.06(i) of the Credit Agreement is hereby amended by deleting the
reference to "$2,500,000" contained therein and inserting "$500,000" in lieu
thereof.
15. Section 8.06(u) of the Credit Agreement is hereby amended by deleting the
reference to "$7,500,000" contained therein and by inserting in lieu thereof a
reference to "$250,000".
16. Section 8.07(ii) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(ii) Intentionally Omitted;".
17. Section 8.07(iii) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(iii) Intentionally Omitted;".
27
Exhibit 4.21
18. Section 8.07(vi) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(vi) Intentionally Omitted; and".
19. Notwithstanding anything to the contrary contained in Section 8.08 of the
Credit Agreement, neither Holdings nor any of its Subsidiaries may make any
payments pursuant to clause (iii) or (viii) of such Section, provided that such
amounts may accrue and may be payable when the Credit Agreement has been
terminated and all Obligations have been paid in full or otherwise when
permitted to be paid by the Required Banks.
20. Section 8.09(a) of the Credit Agreement is hereby amended by deleting clause
(y) contained therein in its entirety and inserting the following new clause (y)
in lieu thereof:
"(y) the Borrower and its Subsidiaries may make Capital Expenditures (i) during
the fiscal quarter ended September 30, 1998, in an amount not to exceed
$3,000,000, (ii) during the two fiscal quarter period ended December 31, 1998,
in an amount not to exceed $8,500,000 (and so long as the aggregate amount of
Capital Expenditures made by the Borrower and its Subsidiaries in fiscal year
1998 does not exceed $15,000,000) and (iii) during each fiscal year thereafter,
for the period from the first day of such fiscal year to the end of each fiscal
quarter occurring in such fiscal year set forth below (on a cumulative basis),
in an amount not to exceed the amount set forth opposite such fiscal quarter
below:
Fiscal Year Fiscal Quarter Ending Amount
1999 March 31, 1999 $ 5,500,000
June 30, 1999 $ 9,500,000
September 30, 1999 $13,500,000
December 31, 1999 $15,000,000
2000 March 31, 2000 $ 3,750,000
June 30, 2000 $ 7,500,000
September 30, 2000 $11,250,000
December 31, 2000 $15,000,000
2001 March 31, 2001 $ 3,750,000
June 30, 2001 $ 7,500,000
28
Exhibit 4.21
21. Section 8.09(b) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(b) Intentionally Omitted."
22. Section 8.09(c) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(c) Intentionally Omitted."
23. Section 8.09(f) of the Credit Agreement is hereby deleted in its entirety.
24. Section 8.10 of the Credit Agreement is hereby amended to read in its
entirety as follows:
"8.10 Minimum Consolidated EBITDA. (a) The Borrower will not permit Consolidated
EBITDA for any Test Period ending on the last day of a fiscal quarter set forth
below to be less than the amount set forth opposite such fiscal quarter below:
Fiscal Quarter Ending .................................. Minimum Consolidated
EBITDA
September 30, 1998 ......................................... $ 5,500,000
December 31, 1998 .......................................... $18,825,000
March 31, 1999 ........................................... $24,400,000
June 30, 1999 ........................................... $35,200,000
September 30, 1999 ......................................... $44,800,000
December 31, 1999 .......................................... $52,600,000
March 31, 2000 ........................................... $53,500,000
June 30, 2000 ............................................ $55,800,000
September 30, 2000 ......................................... $61,300,000
December 30, 2000 .......................................... $72,400,000
March 31, 2001 ........................................... $73,900,000
June 30, 2001 ............................................ $76,700,000"
29
Exhibit 4.21
(b) The Borrower will not permit Consolidated EBITDA for the period from and
including July 1, 1998 to and including February 28, 1999 (taken as one
accounting period) to be less than $22,100,000.
25. Section 8.11 of the Credit Agreement is hereby amended to read in its
entirety as follows:
"8.11 Interest Coverage Ratio. The Borrower will not permit the Interest
Coverage Ratio for any Test Period ending on the last day of a fiscal quarter
set forth below to be less than the ratio set forth opposite such fiscal quarter
below:
Fiscal Quarter Ending ........................ Interest Coverage Ratio
September 30, 1998 .......................... 0.45:1.00
December 31, 1998 .......................... 0.85:1.00
March 31, 1999 ............................ 0.75:1.00
June 30, 1999 ............................ 0.80:1.00
September 30, 1999 .......................... 1.00:1.00
December 31, 1999 .......................... 1.20:1.00
March 31, 2000 ............................ 1.25:1.00
June 30, 2000 ............................ 1.25:1.00
September 30, 2000 .......................... 1.40:1.00
December 30, 2000 .......................... 1.70:1.00
March 31, 2001 ............................ 1.80:1.00
June 30, 2001 ............................ 1.90:1.00"
26. Section 8.12 of the Credit Agreement (as amended) is hereby amended to read
in its entirety as follows:
"8.12 Leverage Ratio. The Borrower will not permit the Leverage Ratio at any
time during a period set forth below to be more than the ratio set forth
opposite such period below:
30
Exhibit 4.21
Period ................................ Leverage Ratio
June 30, 1999 through September 29, 1999 .................. 11.35:1.00
September 30, 1999 through December 30, 1999 .............. 9.00:1.00
December 31, 1999 through March 30, 2000 .................. 6.90:1.00
March 31, 2000 through June 29, 2000 ...................... 6.75:1.00
June 30, 2000 through September 29, 2000 .................. 6.50:1.00
September 30, 2000 through December 30, 2000 .............. 5.90:1.00
December 31, 2000 through March 30, 2001 .................. 4.95:1.00
March 31, 2001 through June 29, 2001 ...................... 4.30:1.00
Thereafter ................................................ 4.15:1.00"
27. Section 8.13(i) of the Credit Agreement is hereby amended to read in its
entirety as follows:
"(i) make (or give any notice in respect of) any voluntary or optional payment
or prepayment on or redemption or acquisition for value of (including, without
limitation, by way of depositing with the trustee with respect thereto or any
other Person money or securities before due for the purpose of paying when due)
any Senior Subordinated Note or any Permitted Holdings PIK Security."
28. Section 8 of the Credit Agreement is hereby amended by inserting at the end
thereof the following new Section 8.16:
"8.16 Quick Ratio. The Borrower will not permit the Quick Ratio as of any date
set forth below to be more than the ratio set forth opposite such date below:
31
Exhibit 4.21
Date ................................. Quick Ratio
September 30, 1998 .................................... 1.40:1.00
December 31, 1998 ..................................... 1.25:1.00
March 31, 1999 ........................................ 1.45:1.00
June 30, 1999 ......................................... 1.35:1.00
September 30, 1999 .................................... 1.30:1.00
December 31, 1999 ..................................... 1.00:1.00
March 31, 2000 ........................................ 1.20:1.00
June 30, 2000 ......................................... 1.20:1.00
September 30, 2000 .................................... 1.20:1.00
December 31, 2000 ..................................... 1.20:1.00
March 31, 2001 ........................................ 1.20:1.00
June 30, 2001 ......................................... 1.20:1.00"
29. The definitions of "Applicable Base Rate Margin", "Applicable Commitment Fee
Percentage", "Applicable Eurodollar Margin" and "Interest Reduction Discount"
contained in Section 10 of the Credit Agreement are hereby amended to read in
their entirety as follows:
"Applicable Base Rate Margin" shall mean a percentage per annum equal to 3.00%,
less the then applicable Interest Reduction Discount, if any.
"Applicable Commitment Fee Percentage" shall mean a percentage per annum equal
to .50%, provided, that from and after any Start Date to and including the
corresponding End Date, the Applicable Commitment Fee Percentage shall be the
respective percentage per annum set forth in clause (A), (B), (C) or (D) below
if, but only if, as of the Test Date for such Start Date the applicable
conditions set forth in clause (A), (B), (C) or (D) below, as the case may be,
are met:
(A) .45% if, but only if, as of the Test Date for such Start Date the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 3.5:1.0 and
none of the conditions set forth in clause (B), (C) or (D) below are satisfied;
32
Exhibit 4.21
(B) .40% if, but only if, as of the Test Date for such Start Date the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 3.0:1.0 and
neither of the conditions set forth in clause (C) or (D) below, as the case may
be, are satisfied;
(C) .35% if, but only if, as of the Test Date for such Start Date the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 2.5:1.0 and
the condition set forth in clause (D) below is not met; or
(D) .30% if, but only if, as of the Test Date for such Start Date the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 2.0:1.0.
Notwithstanding anything to the contrary contained above in this definition, the
Applicable Commitment Fee Percentage shall be .50% at all times (i) prior to the
delivery of the June 30, 1999 financial statements pursuant to Section 7.01(b),
(ii) when the Leverage Ratio shall be more than 3.50:1.00 and (iii) when an
Event of Default shall exist.
"Applicable Eurodollar Margin" shall mean a percentage per annum equal to 4.00%,
less the then applicable Interest Reduction Discount, if any.
"Interest Reduction Discount" shall mean zero, provided that from and after the
first day of any Margin Reduction Period (the "Start Date") to and including the
last day of such Margin Reduction Period (the "End Date"), the Interest
Reduction Discount shall be the respective percentage per annum set forth in
clause (A), (B), (C), (D), (E), (F) or (G) below if, but only if, as of the last
day of the most recent fiscal quarter or year, as the case may be, ended
immediately prior to such Start Day (the "Test Date"), the applicable conditions
set forth in clause (A), (B), (C), (D), (E), (F) or (G) below, as the case may
be, are met:
(A) .50% if, but only if, as of the Test Date for such Start Date, the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 8.00:1.00
and none of the conditions set forth in clause (B), (C), (D), (E), (F) or (G)
below, as the case may be, are satisfied;
(B) 1.00% if, but only if, as of the Test Date for such Start Date, the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 7.00:1.00
and none of the conditions set forth in clause (C), (D), (E), (F) or (G) below,
as the case may be, are satisfied;
(C) 1.50% if, but not only if, as of the Test Date for such Start Date, the
Leverage Ratio for the Test Period ended on such Test Date shall be less than
6.50:1.00 and none of the conditions set forth in clause (D), (E), (F) or (G)
below, as the case may be, are satisfied;
33
Exhibit 4.21
(D) 1.75% if, but only if, as of the Test Date for such Start Date, the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 6.00:1.00
and none of the conditions set forth in clause (E), (F) or (G) below, as the
case may be, are satisfied;
(E) 2.00% if, but only if, as of the Test Date for such Start Date, the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 5.00:1.00
and none of the conditions set forth in clause (F) or (G) below, as the case may
be, are satisfied;
(F) 2.25% if, but only if, as of the Test Date for such Start Date, the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 4.00:1.00
and the condition set forth in clause (G) below is not satisfied; or
(G) 2.50% if, but only if, as of the Test Date for such Start Date, the Leverage
Ratio for the Test Period ended on such Test Date shall be less than 3.50:1.00.
Notwithstanding anything contained above in this definition, the Interest
Reduction Discount shall be zero at all times (i) prior to the delivery of the
June 30, 1999 financial statements pursuant to Section 7.01(b), (ii) when the
Leverage Ratio shall be more than 8.00:1.00 and (iii) when an Event of Default
shall exist.
30. The definition of "Consolidated EBITDA" contained in Section 10 of the
Credit Agreement is hereby amended to read in its entirety as follows:
"Consolidated EBITDA" shall mean, for any period, Consolidated EBIT, adjusted by
adding thereto the amount of all depreciation expense and amortization expense
that were deducted in determining Consolidated EBIT for such period, it being
understood and agreed, however, that Consolidated EBITDA shall be determined
without giving effect to any Restructuring Charges otherwise deducted in
determining Consolidated EBITDA for such period.
31. The definition of "Cumulative Income Amount" contained in Section 10 of the
Credit Agreement is hereby deleted in its entirety.
32. The definition of "Test Period" contained in Section 10 of the Credit
Agreement is hereby amended to read in its entirety as follows:
"Test Period" shall mean the four consecutive fiscal quarters of the Borrower
then last ended (taken as one period), or, if shorter, the period from July 1,
1998 to the last day of the fiscal quarter then last ended.
33. The following new definitions are hereby inserted into Section 10 of the
Credit Agreement in appropriate alphabetical order:
34
Exhibit 4.21
"Consolidated Current Assets" shall mean, at any time, the current assets (other
than cash, Cash Equivalents and deferred income taxes to the extent included in
current assets) of the Borrower and its Subsidiaries (including, without
limitation, the interest in accounts receivable represented by the transferor
certificate held by the Receivables Entity) at such time determined on a
consolidated basis.
"Consolidated Current Liabilities" shall mean, at any time, the current
liabilities of the Borrower and its Subsidiaries determined on a consolidated
basis, but excluding deferred income taxes and the current portion of and
accrued but unpaid interest on any Indebtedness under this Agreement and any
other long-term Indebtedness which would otherwise be included therein.
"Excess Cash Flow" shall mean, for any period (i) the sum of (A) Consolidated
Net Income for such period, plus (B) the amount of all non-cash charges
(including, without limitation or duplication, depreciation, amortization,
non-cash interest expense and Restructuring Charges) included in determining
Consolidated Net Income for such period plus (C) the decrease, if any, in
Working Capital from the first day to the last day of such period (except to the
extent that such decrease occurs as a result of an increase in the Accounts
Receivable Facility), minus (ii) the sum (without duplication) of (A) any
non-cash credits (including from sales of assets) included in determining
Consolidated Net Income for such period, (B) gains from sales of assets (other
than sales of inventory in the ordinary course of business) included in
determining Consolidated Net Income for such period, (C) all Capital
Expenditures (excluding Capital Expenditures made during such period that are
financed by Indebtedness, including Capitalized Lease Obligations but excluding
Loans hereunder), (D) the amount expended in respect of Permitted Acquisitions
during such period, except to the extent constituting Capital Expenditures or
financed with Indebtedness, (E) the aggregate principal amount of permanent
principal payments of Indebtedness for borrowed money of the Borrower and its
Subsidiaries (other than (1) repayments of Indebtedness with proceeds of
issuance of other Indebtedness or with proceeds Recovery Events and (2)
repayments of Loans or other Obligations, provided that repayments of Loans
shall be deducted in determining Excess Cash Flow if such repayments were (x)
required as a result of a mandatory commitment reduction under Section 3.03(b)
or (y) made as a voluntary prepayment with internally generated funds (but in
the case of a voluntary prepayment of Revolving Loans or Swingline Loans, only
to the extent accompanied by a voluntary reduction to the Total Revolving Loan
Commitment)) during such period, (F) non-cash charges added back in a previous
period pursuant to clause (i)(B) above to the extent any such charge has become
a cash item in the current period, (G) the increase, if any, in Working Capital
from the first day to the last day of such period, (H) costs incurred by
Holdings during such period and paid for with the proceeds of dividends paid by
the Borrower pursuant to Section 8.07(iv) to the extent not deducted in
determining Consolidated Net Income for such period and (I) any cash
disbursements made against noncurrent liabilities (such as transition reserves
and deferred taxes) to the extent not deducted in determining Consolidated Net
Income for such period.
35
Exhibit 4.21
"Restructuring Charges" shall mean restructuring charges taken by Holdings and
its Subsidiaries relating to plant rationalization and obsolete inventory,
provided that such restructuring charges shall only constitute Restructuring
Charges hereunder if taken on or after July 1, 1998 and on or before December
31, 2000, and the aggregate amount of Restructuring Charges shall not exceed (i)
in the case of the plant rationalization program, $13,300,000 and (ii) in the
case of obsolete inventory, $2,900,000.
"Quick Ratio" shall mean, at any time, the ratio of (i) inventory of the
Borrower and its Subsidiaries at such time to (ii) the accounts payable and
accrued expenses (other than expenses accrued under Sections 8.08(iii) and
(viii) of this Agreement) of the Borrower and its Subsidiaries at such time.
"Working Capital" shall mean the excess of Consolidated Current Assets (but
excluding therefrom all cash and Cash Equivalents, and deferred income taxes to
the extent included in current assets) over Consolidated Current Liabilities.
34. The Credit Agreement is hereby further amended by adding thereto a new Annex
X in the form of Annex X attached hereto.
B. Consents, Waivers and Agreement
1. Section 1(b) of the Third Amendment is hereby amended by (i) deleting the
references to "January 31, 1999" contained therein and inserting "September 30,
1998" in lieu thereof and (ii) deleting the references to "Scheduled 1/31/99
Reduction" contained therein and inserting "Scheduled September 30, 1998
Reduction" in lieu thereof.
2. The Banks hereby waive compliance with Sections 8.10 and 8.11 of the Credit
Agreement for the Test Period ended June 30, 1998. The Banks hereby waive
compliance with Section 8.12 of the Credit Agreement for the period from and
including July 1, 1998 to but excluding September 30, 1998.
3. The Banks hereby agree that Section 6.03(ii) of the Credit Agreement is
deemed amended to exclude from the scope of such representation and warrant any
conflict that exists between Section 8.08 of the Credit Agreement (as modified
by Section A(19) of this Amendment) and any management or similar agreement
between Holdings or any of its Subsidiaries and Xxxx Capital and/or any Xxxx
Affiliate.
4. In order to induce the Banks to enter into this Amendment, the Borrower
hereby agrees to pay to each Bank which executes and delivers a counterpart of
this Amendment on or before 12:.00 noon (New York time) on September 30, 1998, a
fee equal to 1/4 of 1% of such Bank's Revolving Loan Commitment immediately
after giving effect to this Amendment, such fee to be earned and payable on the
Amendment Effective Date.
36
Exhibit 4.21
C. Miscellaneous Provisions
1. In order to induce the Banks to enter into this Amendment, each of Holdings,
WR Acquisition and the Borrower hereby represents and warrants that (i) no
Default or Event of Default exists as of the Amendment Effective Date (as
defined below) after giving effect to this Amendment and (ii) on the Amendment
Effective Date, after giving effect to this Amendment, all representations and
warranties contained in the Credit Agreement and in the other Credit Documents
are true and correct in all material respects.
2. This Amendment shall become effective on the date (the "Amendment Effective
Date") when the Required Banks, Holdings, WR Acquisition and the Borrower shall
have signed a counterpart hereof (whether the same or different counterparts)
and shall have delivered (including by way of facsimile transmission) the same
to the Agent at its Notice Office.
3. This Amendment is limited as specified and shall not constitute a
modification, acceptance or waiver of any other provision of the Credit
Agreement or any other Credit Document.
4. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which counterparts
when executed and delivered shall be an original, but all of which shall
together constitute one and the same instrument. A complete set of counterparts
shall be lodged with the Borrower and the Agent.
5. All references in the Credit Agreement and each of the Credit Documents to
the Credit Agreement shall be deemed to be references to such Credit Agreement
after giving effect to this Amendment.
6. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.
* * *
37
Exhibit 4.21
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this
Amendment to be duly executed and delivered as of the date hereof.
AMERICAN PAD & PAPER COMPANY
By:
Name:
Title:
WR ACQUISITION, INC.
By:
Name:
Title:
AMERICAN PAD & PAPER COMPANY OF DELAWARE, INC.
By:
Name:
Title:
BANKERS TRUST COMPANY, individually and as Agent
By:
Name:
Title:
38
Exhibit 4.21
BANKBOSTON, N.A.
By:
Name:
Title:
BANK LEUMI USA
By:
Name:
Title:
THE BANK OF NEW YORK
By:
Name:
Title:
THE BANK OF NOVA SCOTIA
By:
Name:
Title:
BANK OF SCOTLAND
By:
Name:
Title:
39
Exhibit 4.21
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By:
Name:
Title:
BANK ONE TEXAS
By:
Name:
Title:
BANK POLSKA KASA OPIEKI, S.A.
By:
Name:
Title:
BEAR, XXXXXXX & CO. INC.
By:
Name:
Title:
CHASE SECURITIES, INC., as agent for CHASE MANHATTAN BANK
By:
Name:
Title:
40
Exhibit 4.21
CHRISTIANIA BANK OG KREDITKASSE, NEW YORK BRANCH
By:
Name:
Title:
By:
Name:
Title:
CIBC INC.
By:
Name:
Title:
ERSTE BANK DER OESTERREICHISCHEN SPARKASSEN AG
By:
Name:
Title:
FIRST UNION CORP.
By:
Name:
Title:
GUARANTY FEDERAL BANK, F.S.B.
By:
Name:
Title:
41
Exhibit 4.21
NATIONS BANK, N.A.
By:
Name:
Title:
XXX CAPITAL FUNDING, L.P., by HIGHLAND CAPITAL MANAGEMENT, L.P., as collateral
manager
By:
Name:
Title:
THE LONG-TERM CREDIT BANK OF JAPAN, LIMITED, NEW YORK BRANCH
By:
Name:
Title:
SANWA BUSINESS CREDIT CORPORATION
By:
Name:
Title:
SOCIETE GENERALE
By:
Name:
Title:
42
