EXHIBIT 10.2
AMENDMENT NO. 2 TO
THIRD AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDMENT NO. 2 TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT
(this "Amendment") made and entered into as of August 8, 2001, by and among
INTERFACE, INC., a Georgia corporation ("Interface"), INTERFACE EUROPE B.V., a
"besloten vennootschap met beperkte aansprakelijkheid" (private company with
limited liability) incorporated and existing under the laws of The Netherlands
with its registered seat in Scherpenzeel, Gld., The Netherlands ("Europe B.V."),
INTERFACE EUROPE LIMITED, a private company limited by shares organized and
existing under the laws of England and Wales ("Europe Limited"), and each other
Foreign Subsidiary (as hereinafter defined) that has become a "Multicurrency
Borrower" under the Credit Agreement described below as provided in Section 3.09
thereof (each an "Additional Multicurrency Borrower" and collectively, the
"Additional Multicurrency Borrowers"; Interface, Europe B.V., Europe Limited,
and all Additional Multicurrency Borrowers referred to collectively herein as
the "Borrowers"), SUNTRUST BANK (formerly SunTrust Bank, Atlanta), a banking
corporation organized under the laws of the State of Georgia ("SunTrust"), BANK
ONE, NA (formerly The First National Bank of Chicago), a national banking
association ("Bank One"), the other banks and lending institutions listed on the
signature pages hereof, and any assignees of SunTrust, Bank One, or such other
banks and lending institutions which become "Lenders" as provided in the Credit
Agreement described below (SunTrust, Bank One, and such other banks, lending
institutions, and assignees referred to collectively herein as the "Lenders"),
SUNTRUST BANK (formerly SunTrust Bank, Atlanta), in its capacity as agent for
those Lenders having Domestic Syndicated Loan Commitments or having outstanding
Domestic Syndicated Loans as provided in the Credit Agreement described below,
and each successor agent for such Lenders as may be appointed from time to time
pursuant to Article X of the Credit Agreement described below (the "Domestic
Agent"), BANK ONE, NA (formerly The First National Bank of Chicago), in its
capacity as agent for those Lenders having outstanding Multicurrency Syndicated
Loan Commitments or having outstanding Multicurrency Syndicated Loans as
provided in the Credit Agreement, and each successor agent for such Lenders as
may be appointed from time to time pursuant to Article X of the Credit Agreement
described below (the "Multicurrency Agent"; the Domestic Agent and the
Multicurrency Agent referred to collectively herein as the "Co-Agents"), and
SUNTRUST BANK (formerly SunTrust Bank, Atlanta), in its capacity as collateral
agent for the Co-Agents and Lenders and each successor collateral agent as may
be appointed from time to time pursuant to Article X of the Credit Agreement
described below (the "Collateral Agent");
W I T N E S S E T H:
WHEREAS, the Borrowers, the Lenders, SunTrust, as Domestic Agent and
Collateral Agent, and Bank One, as Multicurrency Agent, are parties to a certain
Third Amended and Restated Credit Agreement dated as of June 30, 1998, as
amended by Amendment No. 1 to Third
Amended and Restated Credit Agreement dated as of December 19, 2000 (as so
amended, the "Credit Agreement");
WHEREAS, the Borrowers have requested that the Lenders amend the Credit
Agreement in certain respects, including the amendment of certain financial and
other covenants, and the decrease of the Domestic Syndicated Loan Commitments
and the Multicurrency Syndicated Loan Commitments, and that the Lenders waive
certain Events of Default that may have occurred as a result of Interface's
repurchase, redemption or other acquisition of its equity securities;
WHEREAS, the Lenders are willing to amend the Credit Agreement in such
respects and to grant such waiver, subject to the terms and conditions set forth
in this Amendment;
NOW, THEREFORE, for and in consideration of the premises, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. DEFINED TERMS. Unless otherwise expressly defined herein, capitalized
terms used in this Amendment that are defined in the Credit Agreement are used
herein with the respective meanings assigned to such capitalized terms in the
Credit Agreement.
2. AMENDMENTS TO SECTION 1.01 ("DEFINITIONS").
(a) Section 1.01 of the Credit Agreement is hereby amended by
deleting in its entirety the defined term "Applicable Margin" and accompanying
definition, and substituting in lieu thereof the following defined term and
accompanying definition:
"Applicable Margin" shall mean, with respect to all Loans
outstanding as LIBOR Advances or Base Rate Advances, as the case may be, for any
day, the applicable percentage determined from the chart set forth below based
on Interface's Funded Debt Coverage Ratio calculated as of the relevant
determination date:
Funded Debt Applicable Margin Applicable Margin
Coverage Ratio for LIBOR Advances for Base Rate Advances
-------------- ------------------ ----------------------
Greater than or equal to 4.00 2.250% 0.750%
Less than 4.00, but greater
than or equal to 3.50 2.000% 0.500%
Less than 3.50, but greater than
or equal to 3.00 1.750% 0.250%
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Less than 3.00, but greater than
or equal to 2.50 1.500% 0.000%
Less than 2.50, but greater than
or equal to 2.00 1.250% 0.000%
Less than 2.00 1.000% 0.000%
Each change in the Applicable Margin resulting from a change in the Funded Debt
Coverage Ratio shall be effective with respect to outstanding Loans from and
after the date that is five (5) Business Days after the date of delivery to the
Domestic Agent of the financial statements and certificates required by Section
7.07(a), (b), and (c), as applicable, indicating such change, until the date
that is five (5) Business Days immediately following the next date of delivery
of such financial statements and certificates indicating another such change.
Notwithstanding the foregoing, at any time during which Interface has failed to
deliver the financial statement and certificates when required by Section
7.07(a), (b), and (c), as applicable, the Applicable Margin shall be 2.250% for
Loans outstanding as LIBOR Advances and 0.750% for all Loans outstanding as Base
Rate Advances, as the case may be.
(b) Section 1.01 of the Credit Agreement is hereby further amended
by deleting (i) the last sentence of the definition of "Domestic Syndicated Loan
Commitments", and (ii) the last sentence of the definition of "Multicurrency
Syndicated Loan Commitments."
(c) Section 1.01 of the Credit Agreement is hereby further amended
by deleting in its entirety the defined term "Security Documents" and
accompanying definition, and substituting in lieu thereof the following defined
term and accompanying definition:
"Security Documents" shall mean, collectively, the Guaranty
Agreements, the L/C Cash Collateral Assignment, the IRB Collateral Documents,
the Indemnity Agreement, the Borrower Pledge and Security Agreements, the
Subsidiary Pledge and Security Agreements, the Copyright Security Agreements,
the Patent Security Agreements, the Trademark Security Agreements, the
Mortgages, the Control Agreements, and each other guaranty agreement, mortgage,
deed of trust, deed to secure debt, security agreement, pledge agreement,
collateral assignment, or other security or collateral document guaranteeing or
securing the Secured Obligations, as the same may be amended, restated, and
supplemented from time to time.
(d) Section 1.01 of the Credit Agreement is hereby further amended
by adding in appropriate alphabetical order the following defined terms and
accompanying definitions:
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"Amendment No. 2" shall mean the Amendment No. 2 to Third
Amended and Restated Credit Agreement dated as of August 8, 2001, among
the Borrowers, the Lenders and the Co-Agents.
"Amendment No. 2 Effective Date" shall mean the date on which
Amendment No. 2 becomes effective in accordance with its terms.
"Borrower Pledge and Security Agreements" shall mean,
collectively, each Borrower Pledge and Security Agreement executed and
delivered by each of the Borrowers in favor of the Collateral Agent for
the benefit of the Secured Parties pursuant to the requirements of
Section 7.13, in each case in form and substance satisfactory to the
Required Lenders, as the same may be amended, restated and supplemented
from time to time.
"Capital Securities" shall mean, with respect to any Person,
all common, preferred, and other shares of capital stock, partnership
and limited liability company interests, participations, and other
ownership and equity interests and their equivalents (however
designated, and whether voting or non-voting) of such Person's capital
or other equity, whether now outstanding or hereafter issued.
"Collateral" shall have the meaning set forth in the Security
Documents.
"Collateral Agent" shall mean SunTrust Bank in its capacity as
collateral agent for the Lenders and the other Secured Parties.
"Control Agreements" shall mean, collectively, the agreements
entered into by the various Credit Parties granting to the Collateral
Agent for the benefit of the Secured Parties control of those portions
of the Collateral consisting of investment property, deposit accounts,
letter-of-credit rights, or electronic chattel paper so as to perfect
the Collateral Agent's security interest therein, in each case in form
and substance satisfactory to the Collateral Agent, as the same may be
amended, restated, and supplemented from time to time.
"Copyright Security Agreement" shall mean each Copyright
Security Agreement executed and delivered by any Credit Party in favor
of the Collateral Agent for the benefit of the Secured Parties pursuant
to the requirements of any of the Security Agreements, in the form
required by the terms of any Security Agreement, in each case as
amended, supplemented and restated from time to time.
"Domestic Credit Party" means Interface or any Guarantor.
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"Mortgage" means each mortgage, deed of trust, deed to secure
debt, and other agreement or instrument executed and delivered by any
Credit Party in favor of the Collateral Agent for the benefit of the
Secured Parties pursuant to the requirements of Section 7.13, in form
and substance satisfactory to the Required Lenders, under which a Lien
is granted on the real property and fixtures described therein, in each
case as amended, supplemented, and restated from time to time.
"Patent Security Agreement" shall mean each Patent Security
Agreement executed and delivered by any Credit Party in favor of the
Collateral Agent for the benefit of the Secured Parties pursuant to the
requirements of Section 7.13, in the form required by the terms of any
Security Agreement, as the same may be amended, supplemented and
restated from time to time.
"Receivables Intercreditor Agreement" shall mean the
intercreditor agreement among the parties to the Receivables Sale
Agreements and the Collateral Agent providing for the relative rights
and interests of such parties in and to certain portions of the
Collateral, executed and delivered pursuant to the requirements of
Section 7.13, in form and substance satisfactory to the Collateral
Agent, as the same may be amended, restated and supplemented from time
to time.
"Secured Obligations" shall mean, collectively, (i) the
Obligations as defined herein, and (ii) such other obligations as may
be agreed to in writing by Interface, the Co-Agents and the Required
Lenders as Secured Obligations for purposes of this Agreement and to be
secured by the Security Documents.
"Secured Parties" shall mean, collectively (i) the Co-Agents,
the Collateral Agent, the Lenders, and their respective affiliates that
are parties to any of the Credit Documents, and (ii) such other Persons
to which other Secured Obligations may be owed.
"Security Agreements" means, collectively, the Borrower Pledge
and Security Agreements and the Subsidiary Pledge and Security
Agreements, or either of them, as the case may be.
"Subsidiary Pledge and Security Agreements" shall mean,
collectively, each Subsidiary Pledge and Security Agreement executed
and delivered by each of the Guarantors in favor of the Collateral
Agent for the benefit of the Secured Parties pursuant to the
requirements of Section 7.13, in form and substance satisfactory to the
Required Lenders, as the same may be amended, restated and supplemented
from time to time.
"Trademark Security Agreement" shall mean each Trademark
Security Agreement executed and delivered by any Credit Party in favor
of the Collateral Agent
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for the benefit of the Secured Parties pursuant to the requirements of
Section 7.13, in the form required by the terms of any Security
Agreement, as amended, supplemented, and restated from time to time.
3. AMENDMENT TO ARTICLE II ("DOMESTIC REVOLVING LOANS"). Article II of the
Credit Agreement is hereby amended by adding a new Section 2.09 at the end of
said Article II as follows:
SECTION 2.09. DECREASE IN DOMESTIC SYNDICATED LOAN COMMITMENTS
ON THE AMENDMENT NO. 2 EFFECTIVE DATE.
(a) On the Amendment No. 2 Effective Date, the aggregate
Domestic Syndicated Loan Commitments of the Lenders shall be decreased
from $220,000,000 in aggregate principal amount to $180,000,000 in
aggregate principal amount, with such aggregate decrease being applied
to the Domestic Syndicated Loan Commitments in the manner as described
on the signature pages of Amendment No. 2. After giving effect to the
foregoing actions, the Domestic Syndicated Loan Commitments of the
Lenders shall be as set forth on the signature pages to Amendment No.
2. All Borrowings of Domestic Syndicated Loans pursuant to Section 2.02
and all continuations and conversions of outstanding Domestic
Syndicated Loans pursuant to Section 2.02 occurring after the Amendment
No. 2 Effective Date shall be made on the basis of the revised Domestic
Syndicated Loan Commitments as provided in this Section 2.09. All
Domestic Bid Rate Loans outstanding on the Amendment No. 2 Effective
Date shall continue to remain outstanding in accordance with their
respective terms and shall not be repaid or otherwise affected by the
transactions described in this Section 2.09, except as may otherwise be
required by Section 2.03(d).
(b) From and after the Amendment No. 2 Effective Date,
all references in this Agreement to the Domestic Syndicated Loan
Commitments shall be deemed to mean and refer to the Domestic
Syndicated Loan Commitments as reduced by this Section 2.09 (subject,
however, to subsequent increases or decreases from time to time
pursuant to the provisions of this Agreement).
4. AMENDMENT TO ARTICLE III ("MULTICURRENCY REVOLVING LOANS"). Article III
of the Credit Agreement is hereby amended by adding a new Section 3.10 at the
end of said Article III as follows:
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SECTION 3.10. DECREASE IN MULTICURRENCY SYNDICATED LOAN
COMMITMENTS ON THE AMENDMENT NO. 2 EFFECTIVE DATE.
(a) On the Amendment No. 2 Effective Date, the aggregate
Multicurrency Syndicated Loan Commitments of the Multicurrency
Syndicated Lenders shall be decreased from $80,000,000 in aggregate
principal amount to $70,000,000 in aggregate principal amount, with
such aggregate decrease being the result of pro rata decreases in the
Multicurrency Syndicated Loan Commitments of all Multicurrency
Syndicated Lenders. After giving effect to the foregoing actions, the
Multicurrency Syndicated Loan Commitments of the Multicurrency
Syndicated Lenders shall be as set forth on the signature pages to
Amendment No. 2. All Borrowings of Multicurrency Syndicated Loans
pursuant to Section 3.02 and all continuations and conversions of
outstanding Multicurrency Syndicated Loans pursuant to Section 3.02
occurring after the Amendment No. 2 Effective Date shall be made on the
basis of the revised Multicurrency Syndicated Loan Commitments as
provided in this Section 3.10. All Multicurrency Bid Rate Loans
outstanding on the Amendment No. 2 Effective Date shall continue to
remain outstanding in accordance with their respective terms and shall
not be repaid or otherwise affected by the transactions described in
this Section 3.10, except as may otherwise be required by Section
3.03(e).
(b) From and after the Amendment No. 2 Effective Date,
all references in this Agreement to the Multicurrency Syndicated Loan
Commitments shall be deemed to mean and refer to the Multicurrency
Syndicated Loan Commitments as reduced by this Section 3.10 (subject,
however, to subsequent increases or decreases from time to time
pursuant to the provisions of this Agreement).
5. AMENDMENT TO SECTION 4.03 ("INTEREST"). Section 4.03 of the Credit
Agreement is hereby amended as follows:
(a) Subsection (a) of said Section 4.03 is hereby amended
by deleting clause (i) thereof in its entirety and substituting in lieu
thereof the following clause (i):
(i) For a Base Rate Advance--The Base Rate plus
the Applicable Margin, in each case as in effect from time to
time;
(b) Subsection (b) of said Section 4.03 is hereby amended
by deleting clause (i) thereof in its entirety and substituting in lieu
thereof the following clause (i):
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(i) For a Base Rate Advance--The Base Rate plus
the Applicable Margin, in each case as in effect from time to
time;
6. AMENDMENT TO SECTION 7.09 ("FINANCIAL COVENANTS"). Section 7.09 of the
Credit Agreement is hereby amended by deleting subsections (a) and (b) of said
Section 7.09 in their entirety and substituting in lieu thereof the following
new subsections (a) and (b):
(a) Interest Coverage. Maintain as of the last day of
each fiscal quarter, calculated with respect to the immediately
preceding four fiscal quarters, an Interest Coverage Ratio not less
than the ratio shown below for each respective fiscal quarter:
Period Minimum Interest Coverage Ratio
------ -------------------------------
2nd Fiscal Quarter, 2001 2.25:1.00
3rd Fiscal Quarter, 2001 through 1.75:1.00
1st Fiscal Quarter, 2002
2nd Fiscal Quarter, 2002 2.00:1.00
3rd Fiscal Quarter, 2002 and 2.25:1.00
thereafter
(b) Funded Debt Coverage. Maintain as of the last day of
each fiscal quarter, a maximum Funded Debt Coverage Ratio as shown
below for each respective fiscal quarter:
Period Maximum Funded Debt Coverage Ratio
------ ----------------------------------
2nd Fiscal Quarter, 2001 4.00:1.00
3rd Fiscal Quarter, 2001 4.50:1.00
through 1st Fiscal Quarter, 2002
2nd Fiscal Quarter, 2002 4.25:1.00
3rd Fiscal Quarter, 2002 and 3.50:1.00
thereafter
7. AMENDMENT TO ARTICLE VII ("AFFIRMATIVE COVENANTS"). Article VII of the
Credit Agreement is hereby amended by adding new Sections 7.13 and 7.14 at the
end of said Article VII as follows:
SECTION 7.13. COLLATERAL DOCUMENTS TO BE PROVIDED PURSUANT TO
AMENDMENT NO. 2. As soon as practicable after the Amendment No. 2
Effective Date, but in any event within ninety (90) days after such
date, Interface shall, and shall cause the other
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Credit Parties to, grant first priority, perfected liens to secure the
Secured Obligations on all assets of the Domestic Credit Parties,
including (i) all real property, plants, fixtures, and equipment of the
Domestic Credit Parties, (ii) all inventory, supplies, and work in
progress of the Domestic Credit Parties, (iii) all accounts receivable
(subject to the Receivables Intercreditor Agreement) of the Domestic
Credit Parties, (iv) one hundred percent (100%) of the Capital
Securities of all Subsidiaries (other than Foreign Subsidiaries), and
not less than sixty-five percent (65%) of the Capital Securities of
Foreign Subsidiaries not owned by other Foreign Subsidiaries, and (v)
all investment property, intercompany notes and payables, deposit
accounts, and general intangibles, including patents, trademarks,
copyrights and other intellectual property rights and interests of the
Domestic Credit Parties; subject, however, in each case to any Liens
expressly permitted by the terms of this Agreement, and excluding
assets (x) determined to be non-material by the Required Lenders, or
(y) subject to existing restrictions against further Liens, to the
extent such restrictions are expressly permitted by the terms of this
Agreement and cannot be removed or waived through the best efforts of
the Credit Parties (which best efforts shall not require that any
Domestic Credit Party pay any fee or other sum or that any Domestic
Credit Party agree to an amendment of the underlying transaction giving
rise to such restriction). In furtherance of the foregoing, but without
limitation thereof, the Borrowers shall, and shall cause the other
Credit Parties to, furnish to the Collateral Agent the following
documents and instruments, all in form and substance satisfactory to
the Required Lenders (or, if so indicated, the Co-Agents or the
Collateral Agent, as the case may be) and all to be delivered as soon
as practicable after the Amendment No. 2 Effective Date but in any
event within ninety (90) days after such date:
(a) The duly executed Security Agreements,
Patent Security Agreements, Copyright Security Agreements, and
Trademark Security Agreements, together with copies of filed
UCC-1 financing statements, stock certificates, stock powers
endorsed in blank, Control Agreements, and other documents
necessary for the Collateral Agent to receive a first
priority, perfected security interest in the Collateral
described in such Security Documents;
(b) The duly executed Mortgages and UCC-1
financing statements covering all of the real property and
fixtures owned or subject to long-term lease in the United
States by any of the Credit Parties, in suitable form for
recording in the appropriate public records; provided that
such Mortgages and UCC-1 financing statements shall not be
required for any parcel or group of related parcels of real
property and related fixtures that have a fair market value
(as determined by the Co-Agents in their reasonable credit
judgment) of less than $1,500,000;
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(c) Examination reports of Uniform Commercial
Code, judgment, and federal tax lien records as to the
Domestic Credit Parties in such jurisdictions as deemed
necessary or appropriate by the Required Lenders, evidencing
no Liens as to their respective assets other than those Liens
expressly permitted pursuant to the terms of this Agreement;
(d) Title examination reports or certificates in
respect of the properties described in the Mortgages that have
a fair market value (as determined by the Co-Agents in their
reasonable credit judgment) of less than $5,000,000,
reflecting that title to such properties is vested in the
entities delivering the Mortgages or the lessors of the
entities delivering the Mortgages and title is free and clear
of all defects and encumbrances other than those expressly
permitted by the terms of the Credit Agreement or approved by
the Co-Agents, such reports or certificates to be in form and
substance and issued by title examiners satisfactory to the
Co-Agents;
(e) Final, fully paid mortgagee title insurance
policies in respect of the properties described in the
Mortgages that have a fair market value (as determined by the
Co-Agents in their reasonable credit judgment) of at least
$5,000,000, insuring that title to such properties is vested
in the entities delivering the Mortgages and that the
interests created by each such Mortgages constitute valid
first priority Liens thereon, free and clear of all defects
and encumbrances other than those as approved by the Co-Agents
(such policies to include, to the extent available, revolving
credit endorsements, comprehensive endorsements, variable rate
endorsements, tie-in endorsements, access endorsements and
such other endorsements as the Co-Agents shall reasonably
request), such title insurance policies to be in amounts and
in form and substance and issued by insurers satisfactory to
the Co-Agents; provided, however, that title insurance
policies insuring Mortgages on any parcel or group of related
parcels of real property and related fixtures that have a fair
market value (as determined by the Co-Agents in their
reasonable credit judgment) of less than $10,000,000 shall be
permitted to have "survey exceptions";
(f) (i) Current as-built surveys and surveyor's
certificates with respect to the real property described in
the respective Mortgages with a fair market value (as
determined by the Co-Agents in their reasonable credit
judgment) of at least $10,000,000, such surveys and
certificates to be in form and substance satisfactory to the
Co-Agents, and (ii) copies of any and all surveys and
surveyor's certificates with respect to the real property
described in the respective Mortgages on with a fair market
value (as determined by the Co-Agents in their reasonable
credit judgment) of less than $10,000,000, but only to the
extent such
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surveys and certificates are in the possession of, or already
prepared for, the Domestic Credit Parties;
(g) Phase I and, if reasonably requested by the
Co-Agents, Phase II environmental reports with respect to the
real property described in the Mortgages, together with such
other certificates, reports, environmental audits and
investigations, and other information as the Co-Agents may
have reasonably requested in order to establish the absence of
any material liabilities or obligations arising from
environmental or employee health and safety exposures with
respect to such real property, but only to the extent such
environmental reports and other materials are in the
possession of, or already prepared for, the Domestic Credit
Parties;
(h) Certificates of the Secretary or Assistant
Secretary of each of the Domestic Credit Parties (or
comparable company officer) attaching and certifying copies of
the resolutions of the board of directors of the Domestic
Credit Parties, authorizing as applicable the execution,
delivery and performance of the Security Documents;
(j) Certificates of the Secretary or an
Assistant Secretary of each of the Domestic Credit Parties (or
comparable company officer) certifying (i) the name, title and
true signature of each officer of such entity executing the
Security Documents, and (ii) the by-laws, partnership
agreement, operating agreement, management agreement, or
comparable governing documents of each such entity;
(k) Certified copies of the certificates or
articles of incorporation, certificates of limited
partnership, articles of organization, and other similar
organizational documents of the Domestic Credit Parties
certified by the Secretary of State or the Secretary or
Assistant Secretary of such Domestic Credit Party, together
with certificates of good standing or existence, as may be
available from the Secretary of State of the jurisdiction of
organization of such Domestic Credit Party;
(l) Copies of all documents and instruments,
including all consents, authorizations and filings, required
under any Requirement of Law or by any material Contractual
Obligation of the Domestic Credit Parties, in connection with
the execution, delivery, performance, validity or
enforceability of the Security Documents, and such consents,
authorizations, filings and orders shall be in full force and
effect;
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(m) The favorable legal opinions of counsel to
the Domestic Credit Parties, addressed to the Co-Agents, the
Lenders, and the other Secured Parties, in respect of legal
matters relating to the Domestic Credit Parties, the due
authorization, execution, delivery, validity, binding effect
and enforceability of the Security Documents, perfection of
the Liens granted thereby, and other matters relating thereto
as the Co-Agents shall reasonably request, in each case from
Xxxxxxxxxx Xxxxxxxx LLP, counsel to the Domestic Credit
Parties, and local (including foreign) counsel to the Credit
Parties in jurisdictions in which Mortgages on property with a
fair market value (as determined by the Co-Agents in their
reasonable credit judgment) of at least $10,000,000 will be
recorded by the Co-Agents;
(n) Policies or certificates of insurance
evidencing insurance coverage as to the Collateral and the
Domestic Credit Parties as required to be maintained pursuant
to the Security Documents, issued by one or more insurance
companies satisfactory to the Co-Agents, and showing the
Collateral Agent as loss payee and/or additional insured, as
applicable; and
(o) Such other documents, certificates, and
instruments as may be customarily required in connection with
the types of property comprising the Collateral being
furnished by the Domestic Credit Parties pursuant to the
requirements hereof.
The Borrowers agree to pay all reasonable out-of-pocket costs and
expenses of the Co-Agents and the Collateral Agent in connection with
the preparation, negotiation, execution, delivery, recording and filing
of the Security Documents and all other documents and requirements
referred to in this Section 7.13 (including, without limitation, the
reasonable fees and disbursements of counsel for the Co-Agents and the
Collateral Agent).
It shall be a further condition precedent that the Borrowers cause
Interface Americas, Inc., a Georgia corporation, and Chatham, Inc., a
North Carolina corporation to become Guarantors no later than August 8,
2001.
SECTION 7.14. FURTHER ASSURANCES. The Borrowers shall, and
shall cause the other Domestic Credit Parties to, execute any and all
further documents, financing statements, agreements and instruments,
and take all further action that may be required under applicable law,
or that the Required Lenders, the Co-Agents, or the Collateral Agent
may reasonably request, in order to effect the transactions
contemplated by this Agreement or the Security Documents and in order
to grant, preserve, protect and perfect the validity and first priority
of the security interests created or intended to be created by
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the Security Documents. Without limiting the foregoing, (i) Interface
shall cause each Material Subsidiary required to deliver a Guaranty
Agreement pursuant to Section 7.11 to become a party to the Subsidiary
Pledge and Security Agreement and, if applicable, a Mortgage (but only
with respect to any parcel or group of related parcels of real property
owned by such Subsidiary having a fair market value as determined by
the Co-Agents in their reasonable credit judgment of $1,500,000 or
more) and other applicable Security Documents, together with such lien
searches, title reports, title insurance, surveys, phase I
environmental reports and opinions with respect thereto that Interface
and the Domestic Credit Parties would have delivered if such Security
Documents were delivered to the Lenders to satisfy the requirements of
Section 7.13 above, and (ii) the Borrowers shall, and shall cause the
other Credit Parties to, promptly secure the Secured Obligations by
pledging or creating perfected security interests with respect to
assets acquired by any Domestic Credit Parties subsequent to the date
of the respective Security Documents as required by the terms thereof.
In connection therewith, the Borrowers shall, and shall cause other
applicable Credit Parties to, deliver to the Co-Agents all such
instruments and documents (including legal opinions and lien searches)
as the Co-Agents shall reasonably request to evidence compliance with
this Section. The Borrowers agree to provide such evidence as the
Collateral Agent shall reasonably request as to the perfection and
priority status of each such security interest and Lien.
8. AMENDMENT TO SECTION 8.01 ("INDEBTEDNESS"). Section 8.01 of the Credit
Agreement is hereby amended by deleting clause (a) of said Section 8.01 in its
entirety and substituting in lieu thereof the following clause (a):
(a) Indebtedness under this Agreement and any other
Secured Obligations;
9. AMENDMENT TO SECTION 8.02 ("LIENS"). Section 8.02 of the Credit
Agreement is hereby amended by deleting clause (g) of said Section 8.02 in its
entirety and substituting in lieu thereof the following clause (g):
(g) Liens in favor of the Collateral Agent securing the
Secured Obligations;
10. AMENDMENT TO SECTION 8.03 ("MERGERS, ACQUISITIONS, SALES, ETC.").
Section 8.03 of the Credit Agreement is hereby amended by deleting clause (iv)
of said Section 8.03 in its entirety and substituting in lieu thereof the
following clause (iv):
(iv) purchases or other acquisitions of all or any substantial
portion of the property or assets of any Person (including Capital
Securities, and including all or any substantial portion of the
property or assets of any division, line of business, or business
segment of such Person), provided that (x) such purchases and
acquisitions subsequent to the Amendment No. 2 Effective Date may not
exceed an aggregate amount of $25,000,000
13
(based on the cash portion of the purchase prices payable in respect of
such transactions), if after giving effect to any such purchase or
acquisition, Interface's Funded Debt Coverage Ratio is greater than
3.25:1.00 on a pro forma basis, (y) any such transaction has been
approved in advance by a majority of the board of directors of the
Seller, and (z) where the cash portion of the purchase price payable in
any such transaction exceeds (A) $10,000,000 if after giving effect to
any such purchase or acquisition, Interface's Funded Debt Coverage
Ratio is greater than 3.25:1.00 on a pro forma basis, and (B)
$50,000,000 if after giving effect to any such purchase or acquisition,
Interface's Funded Debt Coverage Ratio is equal to or less than
3.25:1.00 on a pro forma basis, then (1) such transaction shall be
subject to the prior written approval of the Required Lenders, and (2)
Interface shall provide the Lenders pro forma financial statements
demonstrating Interface's continued compliance with the financial
covenants set forth in Section 7.09 and the other terms of this
Agreement after giving effect to any such transaction (for purposes of
computing Interface's Funded Debt Coverage Ratio on a pro forma basis
with respect to any particular purchase or acquisition transaction,
such ratio shall be computed with respect to the four consecutive
fiscal quarters ending with Interface's most recently completed fiscal
quarter and on the assumption that such purchase or acquisition
occurred on the first day of such four-quarter period);
11. AMENDMENT TO SECTION 8.04 ("PAYMENTS OR REFINANCINGS IN RESPECT OF
SUBORDINATED DEBT OR EQUITY SECURITIES"). Section 8.04 of the Credit Agreement
is hereby amended by deleting in its entirety clause (ii) of the first sentence
of said Section 8.04, and substituting in lieu thereof the following clause
(ii):
(ii) Interface's Funded Debt Coverage Ratio is less than 3.25:1.00,
and Interface's Interest Coverage Ratio is greater than 2.25:1.00, in
each case as of the end of the then most recent fiscal quarter of
Interface (both on an actual basis and after giving pro forma effect to
all such payments, refinancings or replacements).
12. WAIVER OF EVENT OF DEFAULT. The Lenders hereby agree to waive any and
all Events of Default resulting from Interface's purchase, redemption, or other
acquisition of its equity securities on and after the Closing Date, and prior to
the Amendment No. 2 Effective Date, at any time when such action was not
permitted by the terms of Section 8.04 of the Credit Agreement, for an aggregate
consideration paid in respect of all such purchases, redemptions, and other
acquisitions not to exceed $13,000,000. The foregoing waiver is limited to any
Events of Default occurring as a result of any such breaches of said Section
8.04, and no other waivers of any other Defaults or Events of Default pursuant
to the terms of the Credit Agreement are being granted or are implied hereby.
13. AMENDMENT FEES. In consideration of the Lenders entering into this
Amendment, and granting the waiver as provided in Section 12 of this Amendment,
the Borrowers agree to pay to
14
the Domestic Agent, for the account of each Lender who has executed and
delivered to the Domestic Agent a counterpart of this Amendment not later than
5:00 p.m. (Atlanta, Georgia time) on August 8, 2001, an amount equal to (x) such
Lender's Total Commitment (after giving effect to the reduction in such Total
Commitment being made pursuant to the terms of this Amendment), multiplied by
(y) 0.25%.
14. REPRESENTATIONS AND WARRANTIES. Each of Interface (as to itself and all
other Consolidated Companies) and each of the other Borrowers (as to itself and
all of its Subsidiaries) represents and warrants to the Lenders as follows:
(a) All representations and warranties set forth in the Credit
Agreement are true and correct in all material respects with the same effect as
though such representations and warranties have been made on and as of the date
hereof (except that the representation and warranty set forth in Section 6.19 of
the Credit Agreement shall not be deemed to relate to any time subsequent to the
date of the initial Loans under the Credit Agreement);
(b) No Default or Event of Default has occurred and is continuing
on the date hereof;
(c) Since the date of the most recent financial statements of the
Consolidated Companies submitted to the Lenders pursuant to Section 7.07(b),
there has been no change which has had or could reasonably be expected to have a
Materially Adverse Effect (whether or not any notice with respect to such change
has otherwise been furnished to the Lenders pursuant to Section 7.07);
(d) Each of the Borrowers has the corporate power and authority to
make, deliver and perform this Amendment and has taken all necessary corporate
action to authorize the execution, delivery and performance of this Amendment.
No consent or authorization of, or filing with, any Person (including, without
limitation, any governmental authority), is required in connection with the
execution, delivery or performance by any Borrower, or the validity or
enforceability against any Borrower, of this Amendment, other than such
consents, authorizations or filings which have been made or obtained (including
without limitation, any necessary consultations with any Borrower's supervisory
board, works council ("Ondernemingsraad") or similar body); and
(e) This Amendment has been duly executed and delivered by each of
the Borrowers and this Amendment constitutes a legal, valid and binding
obligations of the Borrowers, respectively, enforceable against the Borrowers in
accordance with their respective terms, except as may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting
the enforcement of creditors' rights generally and by general principles of
equity.
15
(f) The following entities have been merged into Interface Inc. or
another Subsidiary Guarantor: Guilford (Delaware), Inc., Interface Europe, Inc.,
Interface Asia-Pacific, Inc., Prince Street Technologies, Ltd., Guilford of
Maine Decorative Fabrics, Inc., Interface Holding Company, Interface Specialty
Resources, Inc., Interface Royalty Company and Interface Licensing Company.
15. EFFECTIVENESS OF AMENDMENT. This Amendment shall become effective upon
(i) the execution and delivery to the Domestic Agent of counterparts hereof
(whether originals or facsimile transmissions thereof) on behalf of each of the
Credit Parties, the Co-Agents, and those Lenders constituting the Required
Lenders for purposes of the Credit Agreement, (ii) payment to the Domestic
Agent, for the account of those Lenders who have executed and delivered to the
Domestic Agent a counterpart of this Amendment not later than 5:00 p.m.
(Atlanta, Georgia time) on August 8, 2001, the amendment fees as provided in
Section 13 above, and (iii) payment of all other fees, costs and expenses of the
Co-Agents in respect of this Amendment, including without limitation, all
reasonable fees and expenses of counsel for the Co-Agents.
16. REFERENCES TO CREDIT AGREEMENT. On and after the date this Amendment
becomes effective as provided in Section 15 above, each and every reference in
the Credit Documents to the Credit Agreement shall be deemed to refer to and
mean the Credit Agreement as amended by this Amendment. The Borrowers further
confirm and agree that (i) except as expressly amended herein, the Credit
Agreement remains in full force and effect in accordance with its terms, and
(ii) all other Credit Documents remain in full force and effect in accordance
with their respective terms.
17. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
18. MISCELLANEOUS. This Amendment and the rights and obligations of the
parties hereunder shall be construed in accordance with and be governed by the
law (without giving effect to the conflict of law principles thereof) of the
State of Georgia. This Amendment shall be binding on and shall inure to the
benefit of and be enforceable by the respective successors and assigns of the
parties hereto.
16
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered in Atlanta, Georgia, by their duly authorized
officers as of the day and year first above written.
INTERFACE, INC.
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
INTERFACE EUROPE B.V.
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Xxxxxx X. Xxxxxxx
Attorney-in-Fact
INTERFACE EUROPE LIMITED
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Xxxxxx X. Xxxxxxx
Attorney-in-Fact
17
SUNTRUST BANK
(FORMERLY SUNTRUST BANK, ATLANTA),
AS DOMESTIC AGENT, COLLATERAL AGENT,
AND A LENDER
By: /s/ Xxxxx Xxxx
---------------------------------------------
Name: Xxxxx Xxxx
Title: Director, Senior Relationship Manager
AMOUNT PRO RATA SHARE
---------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 21,208,333.33 11.7824%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 9,625,000.00 13.7500%
TOTAL COMMITMENT
(EXCLUDING DOMESTIC
SWING LINE): $ 30,833,333.33 12.3333%
18
BANK ONE, NA
(FORMERLY THE FIRST NATIONAL BANK OF
CHICAGO), AS MULTICURRENCY AGENT AND
A LENDER
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Corporate Banking Officer
AMOUNT PRO RATA SHARE
---------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 21,208,333.33 11.7824%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 9,625,000.00 13.7500%
TOTAL COMMITMENT
(EXCLUDING DOMESTIC
SWING LINE): $ 30,833,333.33 12.3333%
19
ABN AMRO BANK N.V.
By: /s/ Xxxx X. Honda
--------------------------------
Name: Xxxx X. Honda
Title: Group Vice President
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
AMOUNT PRO RATA SHARE
---------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 18,266,666.67 10.1481%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 8,400,000.00 12.0000%
TOTAL COMMITMENT: $ 26,666,666.67 10.6667%
20
THE BANK OF TOKYO-MITSUBISHI,
LTD., ATLANTA AGENCY
By: /s/ Xxxxxxx Xxxxxxxxxx
--------------------------------------------
Name: Xxxxxxx Xxxxxxxxxx (Attorney-in-Fact)
Title: Vice-President
AMOUNT PRO RATA SHARE
------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 12,291,667 6.83%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 4,375,000 6.25%
TOTAL COMMITMENT: $ 16,666,667 6.67%
21
CIBC INC.
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Executive Director
CIBC World Markets Corp., As Agent
AMOUNT PRO RATA SHARE
---------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 12,291,666.67 6.8287%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 4,375,000.00 6.2500%
TOTAL COMMITMENT: $ 16,666,666.67 6.6667%
22
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
By: /s/ Xxxxxxxxx Xxxxxx
---------------------------
Name: Xxxxxxxxx Xxxxxx
Title: Vice President
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
AMOUNT PRO RATA SHARE
---------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 21,666,666.67 12.0370%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 0 0.0000%
TOTAL COMMITMENT: $ 21,666,666.67 8.6667%
23
FIRST UNION NATIONAL BANK
By: /s/ Xxxxx X.X. Xxxxxxxx
---------------------------
Name: Xxxxx X.X. Xxxxxxxx
Title: Vice President
AMOUNT PRO RATA SHARE
------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 18,266,667 10.15%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 8,400,000 12.00%
TOTAL COMMITMENT: $ 26,666,667 10.67%
24
FLEET NATIONAL BANK
By: /s/ Xxxx X. Xxxxxxxxxx
---------------------------
Name: Xxxx X. Xxxxxxxxxx
Title: Vice President
AMOUNT PRO RATA SHARE
---------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 18,266,666.67 10.1481%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 8,400,000.00 12.0000%
TOTAL COMMITMENT: $ 26,666,666.67 10.6667%
25
BANK OF AMERICA, N.A.
(FORMERLY NATIONSBANK, N.A.)
By: /s/ Xxxxxxx X. Xxxxx
---------------------------
Name: Xxxxxxx X. Xxxxx
Title: Principal
AMOUNT PRO RATA SHARE
---------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 18,266,666.67 10.1481%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 8,400,000.00 12.0000%
TOTAL COMMITMENT: $ 26,666,666.67 10.6667%
26
WACHOVIA BANK, N.A.
By: /s/ Xxxx X. Xxxxxx
-----------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President
AMOUNT PRO RATA SHARE
---------------- --------------
DOMESTIC SYNDICATED
LOAN COMMITMENT: $ 18,266,666.67 10.1481%
MULTICURRENCY SYNDICATED
LOAN COMMITMENT: $ 8,400,000.00 12.0000%
TOTAL COMMITMENT: $ 26,666,666.67 10.6667%
27
ACKNOWLEDGMENT AND AGREEMENT
OF SUBSIDIARY GUARANTORS
Reference is hereby made to the within and foregoing Amendment No. 2 to
Third Amended and Restated Credit Agreement dated as of August 8, 2001, by and
among Interface, Inc., Interface Europe B.V., Interface Europe Limited, SunTrust
Bank, as Domestic Agent and Collateral Agent, Bank One, N.A., as Multicurrency
Agent, and the Lenders parties thereto ("Amendment No. 2"; capitalized terms
used herein that are defined in Amendment No. 2 or in the "Credit Agreement" as
defined in Amendment No. 2 being used herein with the respective meanings
assigned to such capitalized terms in Amendment No. 2 or the Credit Agreement,
as the case may be). Each of the undersigned, which is a Subsidiary Guarantor
under the terms of the Third Amended and Restated Subsidiary Guaranty Agreement
referred to in the Credit Agreement, hereby acknowledges and agrees that (i) the
undersigned has consented to the foregoing Amendment No. 2, (ii) the Third
Amended and Restated Subsidiary Guaranty Agreement and the other Credit
Documents to which each of the undersigned is a party shall remain in full force
and effect on and after the date hereof, and (iii) each of the undersigned
hereby reaffirms and restates its obligations and liabilities under the Third
Amended and Restated Subsidiary Guaranty Agreement and the other Credit
Documents to which each of the undersigned is a party after giving effect to
Amendment No. 2.
This Acknowledgment and Agreement of Subsidiary Guarantors made and
delivered as of August 8, 2001.
EACH CORPORATION OR COMPANY
LISTED ON SCHEDULE I ATTACHED
HERETO:
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxx
Title:
SCHEDULE I
SUBSIDIARY GUARANTORS
Interface Interior Fabrics, Inc., a Delaware corporation
(Formerly Guilford of Maine, Inc.)
Interface Flooring Systems, Inc., a Georgia corporation
Interface Overseas Holdings, Inc., a Georgia corporation and successor by merger
to Interface Europe, Inc. and Interface Asia-Pacific, Inc.
Bentley Xxxxx, Inc., a Delaware corporation
Intek, Inc., a Georgia corporation
Toltec Fabrics, Inc., a Georgia corporation
Interface Architectural Resources, Inc., a Michigan corporation
(Formerly C-Tec, Inc.)
Guilford of Maine, Inc., a Nevada corporation
Guilford of Maine Finishing Services, Inc., a Nevada corporation
Guilford of Maine Marketing Co., a Nevada corporation
Intek Marketing Co., a Nevada corporation
Interface Americas Workplace Solutions, Inc.,
(formerly Interface Americas Services, Inc.)
Interface Americas Holdings, Inc., a Georgia corporation (formerly Interface
Americas, Inc.)
Re:Source Americas Enterprises, Inc., a Georgia corporation
Prince Street Royalty Company, a Nevada corporation
Bentley Royalty Company, a Nevada corporation
Superior/Xxxxxx Flooring Resources, Inc., a Texas corporation
Quaker City International, Inc., a Pennsylvania corporation
Commercial Flooring Systems, Inc., a Pennsylvania corporation
Re: Source Massachusetts, Inc., a Massachusetts corporation formerly known as
Congress Flooring Corp.
Flooring Consultants, Inc., an Arizona corporation
Re:Source New York, Inc., a New York corporation formerly known as Xxxxxx/White
Carpet Company, Inc.
Re:Source New Jersey, Inc., a New Jersey corporation formerly known as X.
Xxxxxxx & Sons, Inc.
Interface Americas, Inc., a Georgia corporation
Chatham, Inc., a North Carolina corporation
