FIRST AMENDMENT TO
CREDIT AGREEMENT
First Amendment (this "Amendment") dated as of
February 19, 1997 among Imo Industries Inc. (with its successors
and permitted assigns, the "Borrower") and the undersigned
Lenders (as defined below), to the Credit Agreement dated as of
April 29, 1996 (as such agreement may be amended, supplemented or
modified from time to time, the "Credit Agreement") among the
Borrower, Varo Inc., Xxxxxx Pumps Inc., the institutions from
time to time party thereto as lenders (the "Lenders"), the
institutions from time to time party thereto as issuing banks
(the "Issuing Banks"), and Citicorp USA, Inc., in its capacity as
agent and collateral agent for the Lenders and the Issuing Banks
(in such capacity, the "Agent").
W I T N E S S E T H:
WHEREAS, the Borrower has requested the undersigned
Lenders, (i) to defer payment of installments on the A Term Loans
and the B Term Loans due during the period from the effective
date of this Amendment through December 31, 1997, (ii) to permit
certain proposed asset sales, (iii) to amend the financial
covenants contained in Sections 10.01 through 10.06 of the Credit
Agreement and (iv) to make certain other amendments to the Credit
Agreement, in each case substantially along the lines set forth
in that certain letter dated January 29, 1997 from the Borrower
to the Agent, a copy of which is attached hereto as Exhibit A;
and
WHEREAS, the parties hereto desire to amend the Credit
Agreement as hereinafter set forth;
NOW, THEREFORE, in consideration of the above premises,
the Borrower and the undersigned Lenders agree as follows:
SECTION 1. Defined Terms. Capitalized terms used
herein without definition shall have the meanings ascribed to
such terms in the Credit Agreement.
SECTION 2. Amendment of Section 1.01.
(a) Section 1.01 of the Credit Agreement is, effective
as of the Amendment Effective Date, hereby amended by inserting
the following definition after the definition of "Alternative
Currency" and before the definition of "Applicable Base Rate
Margin":
"Annualized Basis" means with respect to the
calculation of EBITDA for the fiscal period ending on the
last day of each of the first three fiscal quarters of 1997,
(i) with respect to such calculation for the first such
fiscal quarter, four (4) times EBITDA for such quarter, (ii)
with respect to such calculation for the second such fiscal
quarter, two (2) times EBITDA for the six month period
ending on the last day of such quarter and (iii) with
respect to such calculation for the third such fiscal
quarter, one and one-third (1 1/3) times EBITDA for the nine
month period ending on the last day of such quarter.
(b) The definition of "Consolidated Net Worth"
contained in Section 1.01 of the Credit Agreement is, effective
as of the Amendment Effective Date, hereby amended by deleting
the words "Discontinued Operations or" in clause (x) thereof.
(c) Section 1.01 of the Credit Agreement is, effective
as of the Amendment Effective Date, hereby amended by deleting
the definition of "Discontinued Operations" in its entirety.
(d) The definition of "EBITDA" contained in Section
1.01 of the Credit Agreement is, effective as of the Amendment
Effective Date, hereby amended by deleting the words "the
Discontinued Operations and" in clauses (i)(E) and (ii)(A)
thereof.
(e) The definition of "Excess Cash Flow" contained in
Section 1.01 of the Credit Agreement is, effective as of the
Amendment Effective Date, hereby amended by replacing the words
"Discontinued Operations" contained in the parenthetical in
clause (x) thereof with the words "Proposed Dispositions".
(f) The definition of "Fixed Charge Coverage Ratio"
contained in Section 1.01 of the Credit Agreement is, effective
as of the Amendment Effective Date, hereby amended by (i)
deleting all the parentheticals in such definition which contain
the words "Discontinued Operations" and (ii) deleting the phrase
", minus any net increase in Working Capital for such period,
plus any net decrease in Working Capital for such period" from
clause (i) thereof.
(g) The definition of "Interest Coverage Ratio"
contained in Section 1.01 of the Credit Agreement is, effective
as of the Amendment Effective Date, hereby amended by deleting
all the parentheticals in such definition which contain the words
"Discontinued Operations".
(h) Section 1.01 of the Credit Agreement is, effective
as of the Amendment Effective Date, hereby amended by inserting
the following definition after the definition of "Maximum
Subsidiary Investment Amount" and before the definition of
"Multiemployer Plan":
"Xxxxx Receivable" means the unpaid receivable
resulting from the unpaid portion (approximately 4,500,000
Deutschmarks) of a 1992 dividend declared by the Borrower's
German Subsidiary, Teleflex GmbH (now merged with and into
Imo Industries GmbH), to the Borrower's English Subsidiary,
Xxxxx Controls Ltd.
(i) Section 1.01 of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended by
inserting the following sentence at the end of the definition of
"Net Cash Proceeds":
For purposes of this definition, any cash proceeds received
by the Borrower or Varo in connection with Varo's claim
against the federal government under U.S. Government
Contract No. F09603-86-C-2278 (which claim, on appeal from a
decision of the Contracting Officer in respect of such
contract, is, as of the date of the First Amendment to this
Agreement, pending before the Armed Services Board of
Contract Appeals (ASBCA Nos. 47945 and 47946)) shall
constitute Net Cash Proceeds of the type described in clause
(i) of this definition.
(j) Section 1.01 of the Credit Agreement is, effective
as of the Amendment Effective Date, hereby amended by inserting
the following definition after the definition of "Property" and
before the definition of "Pro Rata Share":
"Proposed Dispositions" means the businesses and assets
of the Borrower and the Restricted Subsidiaries identified
on Schedule 1.01.14.
SECTION 3. Amendment of Section 2.01.
(a) Section 2.01(f)(i) of the Credit Agreement is,
effective as of the Amendment Effective Date (it being understood
and agreed that this amendment of Section 2.01(f)(i) shall be
effective as of the Amendment Effective Date only after the
receipt by the Agent of a copy of this Amendment, duly executed
by the Borrower and each of the Lenders), hereby amended in its
entirety as follows:
(i) A Term Loans. The A Term Loans shall be repayable
in seventeen (17) quarterly installments on the dates and in
the amounts set forth below:
Date Installment Amount
July 31, 1996 $1,250,000.00
October 31, 1996 $1,250,000.00
January 31, 1997 $1,250,000.00
April 30, 1997 $0
July 31, 1997 $0
October 31, 1997 $0
January 31, 1998 $1,517,857.14
April 30, 1998 $1,517,857.14
July 31, 1998 $1,517,857.14
October 31, 1998 $1,517,857.14
January 31, 1999 $1,517,857.14
April 30, 1999 $1,517,857.14
July 31, 1999 $1,517,857.14
October 31, 1999 $1,517,857.14
January 31, 2000 $1,517,857.14
April 30, 2000 $1,517,857.14
July 31, 2000 $1,517,857.14
October 31, 2000 $1,517,857.14
January 31, 2001 $1,517,857.14
April 30, 2001 $1,517,857.18;
provided, however, that, in any event, the seventeenth
installment shall be in the amount of the then outstanding
principal balance of the A Term Loans.
(b) Section 2.01(f)(ii) of the Credit Agreement
is, effective as of the Amendment Effective Date (it being
understood and agreed that this amendment of Section 2.01(f)(ii)
shall be effective as of the Amendment Effective Date only after
the receipt by the Agent of a copy of this Amendment, duly
executed by the Borrower and each of the Lenders), hereby amended
in its entirety as follows:
(ii) B Term Loans. The B Term Loans shall be repayable
in eleven (11) consecutive quarterly installments on the
dates and in the amounts set forth below:
Date Installment Amount
January 31, 1998 $2,585,227.27
April 30, 1998 $2,585,227.27
July 31, 1998 $2,585,227.27
October 31, 1998 $2,585,227.27
January 31, 1999 $2,585,227.27
April 30, 1999 $2,585,227.27
July 31, 1999 $2,585,227.27
October 31, 1999 $2,585,227.27
January 31, 2000 $2,585,227.27
April 30, 2000 $2,585,227.27
July 31, 2000 $2,269,369.63;
provided, however, that, in any event, the eleventh
installment shall be in the amount of the then outstanding
principal balance of the B Term Loans.
(c) Section 2.01(f)(iii) of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended in
its entirety as follows:
(iii) C Term Loans. The C Term Loans shall be repayable
in twenty-eight (28) consecutive quarterly installments on the
dates and in the amounts set forth below:
Date Installment Amount
July 31, 1996 $125,000
October 31, 1996 $125,000
January 31, 1997 $125,000
April 30, 1997 $125,000
July 31, 1997 $125,000
October 31, 1997 $125,000
January 31, 1998 $125,000
April 30, 1998 $125,000
July 31, 1998 $125,000
October 31, 1998 $125,000
January 31, 1999 $125,000
April 30, 1999 $125,000
July 31, 1999 $125,000
October 31, 1999 $125,000
January 31, 2000 $125,000
April 30, 2000 $125,000
July 31, 2000 $125,000
October 31, 2000 $125,000
January 31, 2001 $125,000
April 30, 2001 $125,000
July 31, 2001 $5,312,000
October 31, 2001 $5,312,000
January 31, 2002 $5,312,000
April 30, 2002 $5,312,000
July 31, 2002 $5,312,000
October 31, 2002 $5,312,000
January 31, 2003 $5,312,000
April 30, 2003 $5,316,000;
provided, however, that, in any event, the twenty-eighth
installment shall be in the amount of the then outstanding
principal balance of the C Term Loans.
SECTION 4. Amendment of Section 3.01.
(a) Section 3.01(b)(i) of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended by
(i) deleting the first parenthetical in such Section and (ii)
replacing the proviso in the second sentence thereof in its
entirety as follows:
provided, that after the aggregate principal amount of the
Term Loans outstanding on the Amendment Effective Date (as
defined in the First Amendment to Credit Agreement dated as
of February 19, 1997) has been reduced by at least
$50,000,000, at Borrower's option, exercised at any time by
written notice to the Agent, Net Cash Proceeds shall not be
applied to the remaining Term Loans but instead applied to
any outstanding non-contingent Revolving Credit Obligations
(without any permanent reduction in the Revolving Credit
Commitments).
(b) Section 3.01(b)(iii) of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended by
replacing the proviso in clause (B) of the first sentence thereof
in its entirety as follows:
provided, however, that the mandatory prepayment referred to
in this clause (B) shall be reduced to fifty percent (50%)
of such Excess Cash Flow after the Borrower and its
Restricted Subsidiaries have sold Roltra-Xxxxx S.p.A. and
have received Net Cash Proceeds of at least $50,000,000 from
such sale and the sale of other Proposed Dispositions.
SECTION 5. Amendment of Section 6.01. Section 6.01(c)
of the Credit Agreement is, effective as of the Amendment
Effective Date, hereby amended by deleting the parenthetical
"(other than the Discontinued Operations)" in the penultimate
sentence of such Section.
SECTION 6. Amendment of Section 9.01. Section 9.01 of
the Credit Agreement is, effective as of the Amendment Effective
Date, hereby amended (x) by deleting the word "and" immediately
following clause (xiii) thereof, (y) replacing the period at the
end of clause (xiv) of such Section with a "; and", and (z)
inserting the following clause (xv) at the end of such section:
(xv) Indebtedness not in excess of a principal amount
of $3,000,000 of the Borrower owing to Xxxxx Controls Ltd.
from the Xxxxx Receivable and the assignment thereof to the
Borrower.
SECTION 7. Amendment of Section 9.02. Clause (viii)
of Section 9.02 of the Credit Agreement is, effective as of the
Amendment Effective Date, hereby amended to read in full as
follows:
(viii) the sale by the Borrower and/or its Subsidiaries,
as applicable, in a single transaction or in a series of
transactions, pursuant to documentation which shall be
delivered to the Agent promptly upon its becoming available,
of all or any part of the Proposed Dispositions; provided
that (i) if Varo's electronic systems division is so sold,
the Borrower shall have received Net Cash Proceeds of at
least $9,000,000 in respect thereof, (ii) if Roltra-Xxxxx
S.p.A. is so sold, (x) the Borrower shall have received Net
Cash Proceeds of at least $30,000,000 in respect thereof and
(y) if such sale is consummated at any time on or prior to
September 30, 1998, the Requisite Lenders and the Borrower
shall have amended the Financial Covenants contained in
Sections 10.02, 10.03, 10.05 and 10.06 for the fiscal
periods ending on or after the date of consummation of such
sale through September 30, 1998 in accordance with the terms
of Section 14.07, solely for the purpose of taking into
account such sale, and (iii) no such sale of Proposed
Dispositions (other than Varo's electronic systems division
and Roltra-Xxxxx S.p.A.) shall be made for less than Fair
Market Value; and
SECTION 8. Amendment of Section 9.04. Clause (viii)
of Section 9.04 of the Credit Agreement is, effective as of the
Amendment Effective Date, hereby amended to read in full as
follows:
(viii) Investments by the Borrower and/or any of the
Restricted Subsidiaries in one or more Unrestricted
Subsidiaries or Permitted Joint Ventures which are not
organized and existing under the laws of the United States
of America, any State thereof, the District of Columbia or
the United States Virgin Islands; provided that the
aggregate book value of such Investments made after the
Closing Date, determined with respect to each such
Investment at the time such Investment is made, shall not
exceed $5,000,000 (it being understood and agreed that such
amount shall not include any Investments in Roltra-Xxxxx
S.p.A), or, after the aggregate outstanding principal amount
of the Term Loans and Revolving Loans has been reduced to an
amount equal to or less than $75,000,000, $10,000,000;
provided further, that notwithstanding the foregoing
proviso, (i) the Borrower and the Restricted Subsidiaries
are permitted to make cash Investments in Roltra-Xxxxx
S.p.A. of up to $10,000,000 and (ii) the Borrower shall be
permitted to hold an Investment of Indebtedness or equity in
Imo Industries GmbH resulting from the assignment to the
Borrower from Xxxxx Controls Ltd. of the Xxxxx Receivable,
and the conversion of the Xxxxx Receivable to equity;
SECTION 9. Amendment of Section 9.05. Section
9.05(vi) of the Credit Agreement is, effective as of the
Amendment Effective Date, hereby amended to read in full as
follows:
(vi) Extensions, renewals or replacements of Permitted
Existing Accommodation Obligations of the Borrower in
respect of the obligations of any Unrestricted Subsidiary
(provided the amount of such Accommodation Obligations is
not increased as a result of any extension, renewal or
replacement thereof) and other Accommodation Obligations of
the Borrower in respect of obligations of any Unrestricted
Subsidiary; provided that (x) the aggregate amount of such
Accommodation Obligations (other than such extensions,
renewals or replacements of Permitted Existing Accommodation
Obligations) shall not exceed $11,000,000 at any time
outstanding prior to the sale of Roltra-Xxxxx S.p.A. (it
being understood and agreed that $5,000,000 of such amount
shall apply only in respect of obligations of Roltra-Xxxxx
S.p.A.) and (y) the aggregate amount of such Accommodation
Obligations (including Permitted Existing Accommodation
Obligations of the Borrower in respect of the obligations of
any Unrestricted Subsidiary and any extensions, renewals or
replacements of such Permitted Existing Accommodation
Obligations) shall not exceed $10,000,000 at any time
outstanding after such sale;
SECTION 10. Amendment of Article 10.
(a) Section 10.01 of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended to
read in full as follows:
10.01. Minimum Consolidated Net Worth. The Consolidated
Net Worth of the Borrower and its Subsidiaries at all times during
any period set forth below shall not be less than the minimum amount
set forth opposite such period:
Period Minimum Amount
From December 31, 1996 to but
excluding March 31, 1997 -$68,100,000
From March 31, 1997 to but
excluding June 30, 1997 -$68,100,000
From June 30, 1997 to but
excluding September 30, 1997 -$68,100,000
From September 30, 1997 to but
excluding December 31, 1997 -$68,100,000
From December 31, 1997 to but
excluding March 31, 1998 -$68,100,000
From March 31, 1998 to but
excluding June 30, 1998 -$68,100,000
From June 30, 1998 to but
excluding September 30, 1998 -$68,100,000
From September 30, 1998 to but
excluding December 31, 1998 -$68,100,000
From December 31, 1998 to but
excluding March 31, 1999 -$63,100,000
From March 31, 1999 to but
excluding June 30, 1999 -$61,900,000
From June 30, 1999 to but
excluding September 30, 1999 -$60,600,000
From September 30, 1999 to but
excluding December 31, 1999 -$59,400,000
From December 31, 1999 to but
excluding March 31, 2000 -$58,100,000
From March 31, 2000 to but
excluding June 30, 2000 -$55,600,000
From June 30, 2000 to but
excluding September 30, 2000 -$53,100,000
From September 30, 2000 to but
excluding December 31, 2000 -$50,600,000
From December 31, 2000 to but
excluding March 31, 2001 -$48,100,000
From March 31, 2001 to but
excluding June 30, 2001 -$45,600,000
From June 30, 2001 to but
excluding September 30, 2001 -$43,100,000
From September 30, 2001 to but
excluding December 31, 2001 -$40,600,000
From December 31, 2001 to but
excluding March 31, 2002 -$38,100,000
From March 31, 2002 to but
excluding June 30, 2002 -$33,100,000
From June 30, 2002 to but
excluding September 30, 2002 -$28,100,000
From September 30, 2002 to but
excluding December 31, 2002 -$23,100,000
From December 31, 2002 to but
excluding March 31, 2003 -$18,100,000
From March 31, 2003 to but
excluding June 30, 2003 -$18,100,000
(b) Section 10.02 of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended to
read in full as follows:
10.02. Minimum Fixed Charge Coverage Ratio. The
Fixed Charge Coverage Ratio, as determined as of the last
day of each fiscal quarter of the Borrower set forth below
for the twelve month period ending on such date (or if the
period from January 1, 1997 to such date is less than
twelve months, such shorter period), shall not be less than
the minimum ratio set forth opposite such fiscal quarter:
Fiscal Quarter Minimum Ratio
Second fiscal quarter of 1997 0.25 to 1
Third fiscal quarter of 1997 0.35 to 1
Fourth fiscal quarter of 1997 0.50 to 1
First fiscal quarter of 1998 0.70 to 1
Second fiscal quarter of 1998 0.71 to 1
Third fiscal quarter of 1998 0.73 to 1
Fourth fiscal quarter of 1998 0.75 to 1
First fiscal quarter of 1999 0.78 to 1
Second fiscal quarter of 1999 0.80 to 1
Third fiscal quarter of 1999 0.83 to 1
Fourth fiscal quarter of 1999 0.85 to 1
First fiscal quarter of 2000 0.91 to 1
Second fiscal quarter of 2000 0.98 to 1
Third fiscal quarter of 2000 1.04 to 1
Fourth fiscal quarter of 2000 1.10 to 1
First fiscal quarter of 2001 1.15 to 1
Second fiscal quarter of 2001 1.20 to 1
Third fiscal quarter of 2001 1.25 to 1
Fourth fiscal quarter of 2001 1.30 to 1
First fiscal quarter of 2002 1.35 to 1
Second fiscal quarter of 2002 1.40 to 1
Third fiscal quarter of 2002 1.45 to 1
Fourth fiscal quarter of 2002 1.50 to 1
First fiscal quarter of 2003 1.50 to 1
Second fiscal quarter of 2003 1.50 to 1
(c) Section 10.03 of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended to
read in full as follows:
10.03. Minimum Interest Coverage Ratio. The Interest
Coverage Ratio as determined as of the last day of each
fiscal quarter of the Borrower set forth below for the
twelve month period ending on such date (or if the period
from January 1, 1997 to such date is less than twelve
months, such shorter period), shall not be less than the
minimum ratio set forth opposite such fiscal quarter:
Fiscal Quarter Minimum Ratio
First fiscal quarter of 1997 1.00 to 1
Second fiscal quarter of 1997 1.30 to 1
Third fiscal quarter of 1997 1.40 to 1
Fourth fiscal quarter of 1997 1.50 to 1
First fiscal quarter of 1998 1.60 to 1
Second fiscal quarter of 1998 1.60 to 1
Third fiscal quarter of 1998 1.65 to 1
Fourth fiscal quarter of 1998 1.75 to 1
First fiscal quarter of 1999 1.76 to 1
Second fiscal quarter of 1999 1.78 to 1
Third fiscal quarter of 1999 1.79 to 1
Fourth fiscal quarter of 1999 1.80 to 1
First fiscal quarter of 2000 1.85 to 1
Second fiscal quarter of 2000 1.90 to 1
Third fiscal quarter of 2000 1.95 to 1
Fourth fiscal quarter of 2000 2.00 to 1
First fiscal quarter of 2001 2.03 to 1
Second fiscal quarter of 2001 2.07 to 1
Third fiscal quarter of 2001 2.10 to 1
Fourth fiscal quarter of 2001 2.25 to 1
First fiscal quarter of 2002 2.31 to 1
Second fiscal quarter of 2002 2.38 to 1
Third fiscal quarter of 2002 2.44 to 1
Fourth fiscal quarter of 2002 2.50 to 1
First fiscal quarter of 2003 2.50 to 1
Second fiscal quarter of 2003 2.50 to 1
(d) Section 10.04 of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended to
read in full as follows:
10.04. Maximum Capital Expenditures. Capital Expenditures
made or incurred by the Borrower and the Borrower's Subsidiaries on a
consolidated basis during each Fiscal Year set forth below shall not
exceed in the aggregate the amount set forth opposite such Fiscal Year:
Fiscal Year Maximum Amount
Fiscal Year 1997 $27,000,000
Fiscal Year 1998 $27,000,000
Fiscal Year 1999 $27,000,000
Fiscal Year 2000 $27,000,000
Fiscal Year 2001 $27,000,000
Fiscal Year 2002 $27,000,000
Fiscal Year 2003 $27,000,000
(e) Section 10.05 of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended to
read in full as follows:
10.05. Maximum Permitted Senior Debt Ratio. The ratio of
(i) Permitted Senior Debt of the Borrower and its Subsidiaries on a
consolidated basis on the last day of such period to (ii) EBITDA of
the Borrower and its Subsidiaries on a consolidated basis for such
period (or if the period from January 1, 1997 to such date is less
than twelve months, such amount shall be calculated on an Annualized
Basis), as determined as of the last day of each fiscal quarter of the
Borrower set forth below for the twelve month period ending on
such date, shall not be greater than the maximum ratio set forth
opposite such fiscal quarter:
Fiscal Quarter Maximum Ratio
First fiscal quarter of 1997 5.00 to 1
Second fiscal quarter of 1997 3.60 to 1
Third fiscal quarter of 1997 3.60 to 1
Fourth fiscal quarter of 1997 2.90 to 1
First fiscal quarter of 1998 2.80 to 1
Second fiscal quarter of 1998 2.70 to 1
Third fiscal quarter of 1998 2.60 to 1
Fourth fiscal quarter of 1998 2.00 to 1
First fiscal quarter of 1999 1.94 to 1
Second fiscal quarter of 1999 1.88 to 1
Third fiscal quarter of 1999 1.81 to 1
Fourth fiscal quarter of 1999 1.75 to 1
First fiscal quarter of 2000 1.69 to 1
Second fiscal quarter of 2000 1.63 to 1
Third fiscal quarter of 2000 1.56 to 1
Fourth fiscal quarter of 2000 1.50 to 1
First fiscal quarter of 2001 1.50 to 1
Second fiscal quarter of 2001 1.50 to 1
Third fiscal quarter of 2001 1.50 to 1
Fourth fiscal quarter of 2001 1.50 to 1
First fiscal quarter of 2002 1.50 to 1
Second fiscal quarter of 2002 1.50 to 1
Third fiscal quarter of 2002 1.50 to 1
Fourth fiscal quarter of 2002 1.50 to 1
First fiscal quarter of 2003 1.50 to 1
Second fiscal quarter of 2003 1.50 to 1
(f) Section 10.06 of the Credit Agreement is,
effective as of the Amendment Effective Date, hereby amended to
read in full as follows:
10.06. Maximum Permitted Total Debt Ratio. The ratio of
(i) Permitted Total Debt of the Borrower and its Subsidiaries on a
consolidated basis for such period to (ii) EBITDA of the Borrower and
its Subsidiaries on a consolidated basis for such period (or if the
period from January 1, 1997 to such date is less than twelve months,
such amount shall be calculated on an Annualized Basis), as determined
as of the last day of each fiscal quarter of the Borrower set forth
below for the twelve month period ending on such date, shall not
be greater than the maximum ratio set forth opposite such fiscal
quarter:
Fiscal Quarter Maximum Ratio
First fiscal quarter of 1997 9.00 to 1
Second fiscal quarter of 1997 7.20 to 1
Third fiscal quarter of 1997 7.10 to 1
Fourth fiscal quarter of 1997 6.20 to 1
First fiscal quarter of 1998 5.70 to 1
Second fiscal quarter of 1998 5.50 to 1
Third fiscal quarter of 1998 5.50 to 1
Fourth fiscal quarter of 1998 5.00 to 1
First fiscal quarter of 1999 5.00 to 1
Second fiscal quarter of 1999 5.00 to 1
Third fiscal quarter of 1999 5.00 to 1
Fourth fiscal quarter of 1999 5.00 to 1
First fiscal quarter of 2000 4.88 to 1
Second fiscal quarter of 2000 4.75 to 1
Third fiscal quarter of 2000 4.63 to 1
Fourth fiscal quarter of 2000 4.50 to 1
First fiscal quarter of 2001 4.38 to 1
Second fiscal quarter of 2001 4.25 to 1
Third fiscal quarter of 2001 4.13 to 1
Fourth fiscal quarter of 2001 4.00 to 1
First fiscal quarter of 2002 3.88 to 1
Second fiscal quarter of 2002 3.75 to 1
Third fiscal quarter of 2002 3.63 to 1
Fourth fiscal quarter of 2002 3.50 to 1
First fiscal quarter of 2003 3.50 to 1
Second fiscal quarter of 2003 3.50 to 1
SECTION 11. Waiver. To the extent that any Event of
Default may have arisen solely from the Borrower's failure to
comply with the covenants contained in Sections 10.01 through
10.06 of the Credit Agreement for the period beginning as of
September 30, 1996 through the Amendment Effective Date, such
Event of Default is, effective as of the Amendment Effective
Date, hereby waived by the undersigned Lenders.
SECTION 12. Conditions Precedent to the Effectiveness
of this Amendment. This Amendment shall become effective as of
the date hereof on the date (the "Amendment Effective Date") when
the following conditions precedent have been satisfied (unless
waived by the undersigned Lenders):
12.01 The Agent shall have received on or before the
Amendment Effective Date (i) a copy of this Amendment duly
executed by the Borrower and each of the Requisite Lenders except
as provided in Section 3 hereof, (ii) a favorable opinion of
Weil, Gotshal & Xxxxxx LLP, counsel to the Borrower and the
Guarantors, dated the Amendment Effective Date and addressed to
the Agent, the Lenders and the Issuing Banks, with respect to
such matters relating to this Amendment as the Agent may
reasonably request, and (iii) a favorable opinion of Xxxxxx X.
Xxxx, general counsel of the Borrower and the Guarantors, dated
the Amendment Effective Date and addressed to the Agent, the
Lenders and the Issuing Banks, with respect to such matters
relating to this Amendment as the Agent may reasonably request;
without limiting the foregoing, the Borrower and the Guarantors
hereby direct their counsel, Weil, Gotshal & Xxxxxx LLP, and
their general counsel to deliver to the Agent, the Lenders, the
Issuing Banks and Sidley & Austin, such opinions.
12.02 Each of the representations and warranties of
the Borrower and the Guarantors contained in the Credit Agreement
and in the other Loan Documents (after giving effect to this
Amendment) shall be true and correct on and as of the Amendment
Effective Date, except to the extent that any such representation
or warranty expressly relates to a prior date, in which case,
such representation and warranty shall be true and correct as of
such earlier date.
12.03 All corporate and other proceedings, and all
documents, instruments and other legal matters in connection with
the transactions contemplated by this Amendment, shall be
satisfactory in all respects in form and substance to the Agent.
12.04 No Default or Event of Default (other than any
Default or Event of Default relating to any matter waived
pursuant to Section 11 of this Amendment) shall have occurred and
be continuing on the Amendment Effective Date.
Notwithstanding the foregoing, (i) if all the Lenders have not
executed this Amendment by February 28, 1997 (or such later date
as shall be agreed to by the Agent and the Borrower) (the
"Amendment Cut-off Date"), the amendments contained in Section 3
of this Amendment shall be deleted in their entirety and be of no
further force and effect and (ii) if the Amendment Effective Date
has not occurred by the Amendment Cut-off Date or the Borrower
has not paid to the Lenders and the Agent the fees payable to the
Lenders pursuant to Section 15.02 hereof or any other fees
payable to the Agent in connection with this Amendment when such
fees become due and payable, then this Amendment shall cease to
be of any further force and effect.
SECTION 13. Representations and Warranties. The
Borrower hereby represents and warrants to the Lenders, the
Issuing Banks and the Agent that (a) as of the date hereof (and
except as waived pursuant to Section 11 of this Amendment) no
Default or Event of Default under the Credit Agreement shall have
occurred and be continuing, (b) all of the representations and
warranties of the Borrower and the Guarantors contained in the
Credit Agreement (other than any representations and warranties
relating to the matters referred to in Section 11 hereof) and in
any other Loan Document continue to be true and correct as of the
date hereof, as though made on and as of such date, except to the
extent that such representations or warranties expressly relate
to prior dates, in which case, such representations and
warranties shall be true and correct as of such earlier dates.
SECTION 14. Reference to and Effect on the Loan
Documents.
14.01 Upon the effectiveness of this Amendment, on and
after the date hereof, each reference in the Credit Agreement to
"this Agreement", "hereunder", "hereof" or words of like import,
and each reference in the other Loan Documents to the Credit
Agreement, shall mean and be a reference to the Credit Agreement
as amended hereby.
14.02 Except as specifically amended above, all of the
terms of the Credit Agreement and all other Loan Documents shall
remain unchanged and in full force and effect
14.03 The execution, delivery and effectiveness of
this Amendment shall not, except as expressly provided herein,
operate as a waiver of any right, power or remedy of any Lender,
any Issuing Bank or the Agent, nor constitute a waiver of any
provision of the Credit Agreement or any of the Loan Documents.
14.04 Notwithstanding anything to the contrary in this
Section 14, upon the effectiveness of this Amendment, the
provision in the Consent and Waiver of the Requisite Lenders
dated December 18, 1996 permitting the Borrower and the
Restricted Subsidiaries to make the Additional Roltra Investment
(as defined in such Consent and Waiver) shall have no further
force or effect, it being understood and agreed that such
Investment shall constitute a portion of the $10,000,000 of
Investments permitted to be made in Roltra-Xxxxx S.p.A. pursuant
to Section 9.04(viii) of the Credit Agreement.
SECTION 15. Fees, Costs and Expenses.
15.01 The Borrower agrees to pay on demand in
accordance with the terms of Section 14.02 of the Credit
Agreement all costs and expenses in connection with the
preparation, reproduction, execution and delivery of this
Amendment, including the reasonable fees and out-of-pocket
expenses of Sidley & Austin, counsel for the Agent.
15.02 The Borrower shall pay to the Agent for the
account of each Lender, in accordance with such Lender's Pro Rata
Share, an amendment fee in an amount equal to 0.25% of the sum of
such Lender's Revolving Credit Commitment, if any, and
outstanding Term Loans, which fee shall be payable on the earlier
to occur of (i) the Amendment Effective Date (if all the Lenders
have executed this Amendment on such date) and (ii) the Amendment
Cut-off Date; provided, however, in the event Section 3 of this
Amendment has not become effective by the Amendment Cut-off Date,
the Borrower shall be required to pay to the Agent solely for the
account of each Lender that has executed this Amendment an
amendment fee in an amount equal to 0.125% of the sum of such
Lender's Revolving Credit Commitment, if any, and outstanding
Term Loans.
SECTION 16. Execution in Counterparts. This Amendment
may be executed and delivered in any number of counterparts and
by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original
and all of which taken together shall constitute one and the same
original agreement.
SECTION 17. Governing Law. THIS AMENDMENT SHALL BE
INTERPRETED, AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO
DETERMINED, IN ACCORDANCE WITH THE INTERNAL LAW OF THE STATE OF
NEW YORK.
IN WITNESS WHEREOF, this Amendment has been duly executed on the
date set forth above.
IMO INDUSTRIES INC.
By: /s/X.X. Xxxx XX
Name:X.X. Xxxx XX
Title:Vice President & Treasurer
CITICORP USA, INC., as Agent and Lender
By: /s/Xxxxxxx X. Xxxxxxx
Name:Xxxxxxx X. Xxxxxxx
Title:Attorney-in-Fact
SANWA BUSINESS CREDIT CORPORATION
By: /s/Xxxxx X. Xxxxxx
Name:Xxxxx X. Xxxxxx
Title:Vice President
BHF-BANK AKTIENGESELLSCHAFT
By:
Name:
Title:
By:
Name:
Title:
XXXXXX COMMERCIAL PAPER INC.
By:
Name:
Title:
THE NIPPON CREDIT BANK LTD.,
NEW YORK BRANCH
By: /s/Xxxxxxxx Xxxxxxxx
Name:Xxxxxxxx Xxxxxxxx
Title:Senior Manager
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENNE
By: /s/Xxxx Xxxxxxx
Name:Xxxx Xxxxxx
Title:First Vice President
By: /s/Xxxxxx Xxxxxx
Name:Xxxxxx Xxxxxx
Title:Vice President
FIRST SOURCE FINANCIAL LLP
By: FIRST SOURCE FINANCIAL,
INC. as its Agent/Manager
By: /s/Xxxx X. Xxxxxxx
Name:Xxxx X. Xxxxxxx
Title:Senior Vice President
By:
Name:
Title:
THE FIRST NATIONAL BANK OF BOSTON
By:
Name:
Title:
TRANSAMERICA BUSINESS CREDIT
CORPORATION
By: /s/Xxxxx Xxxxxxxx
Name:Xxxxx Xxxxxxxx
Title:Senior Vice President
XXXXXXX XXXXX SENIOR FLOATING RATE
FUND
By: /s/Xxxxxxx X. Xxxxxxxx
Name:Xxxxxxx X. Xxxxxxxx
Title:Authorized Signatory
THE CHASE MANHATTAN BANK, N.A.
By: /s/Xxxxx X. Xxxxxxxxxx
Name:Xxxxx X. Xxxxxxxxxx
Title:Vice President
ING CAPITAL ADVISORS, INC., as
Agent for Bank Syndication
Account
By: /s/Xxxxxxxx X. Xxxxxxxx
Name:Xxxxxxxx X. Xxxxxxxx
Title:Vice President & Portfolio Mgr.
PPM AMERICA, INC.
By: PPM AMERICA, INC.,
as attorney-in-fact, on behalf of
Xxxxxxx National Life
Insurance Company
By: /s/Xxxxxxx DiRe
Name:Xxxxxxx DiRe
Title:Vice President/Head
High Yield Bank Loans
SENIOR DEBT PORTFOLIO
By: BOSTON MANAGEMENT AND
RESEARCH, AS INVESTMENT
ADVISOR
By: /s/Payson X. Xxxxxxxxx
Name: Payson X. Xxxxxxxxx
Title:Vice President
MEDICAL LIABILITY MUTUAL INSURANCE CO.
By: Chancellor LGT Senior Secured
Management, Inc. as Investment
Manager
By: /s/Xxxxxxx X. Xxxxxxx
Name:Xxxxxxx X. Xxxxxxx
Title:Managing Director
KEYPORT LIFE INSURANCE CAPITAL COMPANY
By: Chancellor LGT Senior Secured
Management, Inc. as Investment
Manager
By: /s/Xxxxxxx X. Xxxxxxx
Name:Xxxxxxx X. Xxxxxxx
Title:Managing Directo
SOUTHERN PACIFIC THRIFT & LOAN
ASSOCIATION
By:
Name:
Title:
ML CBO IV (CAYMAN) LTD.
By: PROTECTIVE ASSET
MANAGEMENT, L.L.C, as
Collateral Manager
By: /s/ Xxxxx Xxxxxxx
Name:Xxxxx Xxxxxxx CPA,CFA
Title:President
Acknowledged and agreed
to:
VARO INC.
By: /s/X.X. Xxxx XX
Name:X.X. Xxxx XX
Title:Vice President & Treasurer
XXXXXX PUMPS INC.
By: /s/X.X.Xxxx XX
Name:X.X. Xxxx XX
Title:Vice President, Treasurer
& Chief Financial Officer
