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SECOND AMENDMENT TO CREDIT AGREEMENT AND WAIVER
THIS AMENDMENT is made as of this 14th day of March, 1997, by
and between XXXXXXX INDUSTRIES INC., a Delaware corporation ("Borrower"),
NATIONSBANK, N.A. (SOUTH), DEPOSIT GUARANTY NATIONAL BANK and HIBERNIA NATIONAL
BANK (collectively, "Lenders") and NATIONSBANK, N.A. (SOUTH), in its capacity
as the Agent for the Lenders ("Agent").
STATEMENT OF FACTS
Agent, Lenders and Borrower are parties to that certain
Credit Agreement, dated as of August 17, 1994, as amended through the date
hereof (the "Credit Agreement"), pursuant to which Lenders have agreed to make
one or more loans from time to time to the Borrower in accordance with the
terms and conditions thereof. Agent, Lenders and Borrower desire to modify the
Credit Agreement in certain respects in accordance with the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the premises, the
covenants and agreements contained herein, and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged,
Borrower, Agent and Lenders do hereby agree that all capitalized terms used
herein shall have the meanings ascribed thereto in the Credit Agreement (except
as otherwise expressly defined or limited herein) and do hereby further agree
as follows:
STATEMENT OF TERMS
1. AMENDMENTS OF CREDIT AGREEMENT. Subject to the
fulfillment of the conditions precedent to the effectiveness of this Amendment
which are set forth below, the Credit Agreement shall be amended from and after
this date as follows:
(a) Section 1.01 of the Credit Agreement shall be
amended by adding thereto the following new definitions:
"Additional Loans" shall mean, collectively, the
advances made by the Lenders to the Borrower pursuant to
Section 2.04 hereof.
"Additional Loan Commitment" shall mean, at any time
and for any Lender, the amount of its Additional Loan
Commitment in effect at such time as shown on Annex I
attached hereto (as such Annex may be amended from time to
time) and as such commitment may be reduced pursuant to
Section 2.03 hereof or pursuant to Annex I hereto.
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"Additional Loan Commitment Expiration Date" shall
mean May 31, 1997, as such date may be extended, accelerated
or amended from time to time pursuant to the terms of this
Agreement.
"Additional Loan Notes" shall mean the Additional
Loan Notes issued by the Borrower and payable to the order of
the Lenders as evidence of the Additional Loans, each in the
form of Exhibit A-1 attached hereto, and any extensions,
renewals, modifications or replacements thereof or therefor.
"Additional Loan Period" shall mean the period of
time which runs from the date of the Second Amendment until
the Additional Loan Commitment Expiration Date.
"Second Amendment" shall mean the Second Amendment
of Credit Agreement and Waiver, dated as of March 14, 1997,
among the Agent, the Lenders and the Borrower.
"Total Additional Loan Commitments" shall mean, at
any time, the sum of all of the Lenders' Additional Loan
Commitments as then in effect.
"Total Loan Commitments" shall mean, at any time,
the sum of all of the Lender's Revolving Loan Commitments and
Additional Loan Commitments as then in effect.
(b) Section 1.01 of the Credit Agreement shall be
further amended by deleting the definitions of the terms "Commitment Fees",
"Current Liabilities", "Loans", "Notes", "Pro Rata Share" and "Required
Lenders" and by substituting in lieu thereof the following new definitions of
such terms:
"Commitment Fees" shall mean the fees required to be
paid by the Borrower to the Lenders pursuant to Section
4.04(b) and Section 4.04(e) hereof.
"Current Liabilities" shall mean, as of any date,
the amount at which all of the current liabilities of a
Person should be shown on a balance sheet of such Person in
accordance with GAAP, all as determined on a consolidated
basis; provided however, that the term "Current Liabilities"
shall specifically exclude Obligations owing by Borrower
under the Notes.
"Loans" shall mean, collectively, the Revolving Loans
and the Additional Loans.
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"Notes" shall mean, collectively, the Revolving Loan
Notes and the Additional Loan Notes.
"Pro Rata Share" shall mean, when used with
reference to any Lender and any described aggregate or total
amount, an amount equal to the result obtained by multiplying
such described aggregate or total amount by a fraction, the
numerator of which shall be the amount of such Lender's
Revolving Loan Commitment or Additional Loan Commitment (as
the case may be) on such date and the denominator of which
shall be the sum of the Total Revolving Loan Commitments or
Total Additional Loan Commitments (as the case may be) of all
of the Lenders on such date, and if any of such loan
commitments have been terminated such term shall mean an
amount equal to the result obtained by multiplying such
described aggregate or total amount by a fraction, the
numerator of which shall be the aggregate unpaid principal
balance of all of such Loans owing to such Lender as of such
date and the denominator of which shall be the aggregate
unpaid principal balance of all of such Loans owing to all of
the Lenders as of such date.
"Required Lenders" shall mean, at any time, Lenders
holding, in the aggregate, not less than sixty-six and
two-thirds percent (66-2/3%) of the aggregate dollar amount
of the Total Loan Commitments then in effect, and if each of
the Revolving Loan Commitments and the Additional Loan
Commitments have expired or have been terminated, such term
shall mean Lenders holding, in the aggregate, not less than
sixty-six and two-thirds percent (66-2/3%) of the then
aggregate unpaid principal balance of the Obligations then
outstanding.
(c) Section 1.01 of the Credit Agreement shall be
further amended by deleting the phrase "Total Revolving Loan Commitments" in
the definition of the term "Borrowing Base" in and by substituting in lieu
thereof the phrase "Total Loan Commitments".
(d) Section 1.01 of the Credit Agreement shall be
further amended by adding to the end of the definition of the term "Interest
Period" the following new sentence:
In addition, Borrower shall not be entitled to select any
Interest Periods for Additional Loans which extend beyond the
Additional Loan Commitment Expiration Date.
(e) Section 2.01(a) of the Credit Agreement shall be
deleted in its entirety and the following new Section 2.01(a) shall be
substituted in lieu thereof:
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(a) Subject to the terms and conditions set
forth in this Agreement, each Lender severally agrees, upon
the Borrower's request, to advance to the Borrower, from time
to time during the Revolving Loan Period, Revolving Loans in
an aggregate principal amount outstanding at any one time not
to exceed such Lender's Revolving Loan Commitment as in
effect at such time; provided, however, that the Lenders
shall not be obligated hereunder to make Revolving Loans at
any time if the sum of the aggregate principal balance of the
Revolving Loans then outstanding plus the aggregate principal
balance of the Additional Loans then outstanding plus the
aggregate Stated Amount of all Letters of Credit then
outstanding plus the aggregate principal balance of all
Reimbursement Obligations then outstanding exceeds, or would
exceed with the making of any such Revolving Loan, the
Borrowing Base then in effect and provided, further however,
that no Lender shall be obligated hereunder to make Revolving
Loans in excess of such Lender's Revolving Loan Commitment.
The Borrower shall be entitled to borrow, prepay and reborrow
the Revolving Loans from time to time during the Revolving
Loan Period in accordance with the provisions of this
Agreement.
(f) Section 2.03 of the Credit Agreement shall be deleted
in its entirety and the following new Section 2.03 shall be substituted in lieu
thereof:
SECTION 2.03. TOTAL LOAN COMMITMENTS; REDUCTIONS
IN REVOLVING LOAN COMMITMENTS AND ADDITIONAL LOAN
COMMITMENTS.
(a) If at any time the sum of the aggregate
outstanding principal amount of all of the Revolving Loans
plus the aggregate principal amount of all of the Additional
Loans plus the aggregate Stated Amount of all outstanding
Letters of Credit plus the aggregate outstanding principal
amount of all the Reimbursement Obligations shall exceed the
Borrowing Base then in effect, Borrower shall immediately
upon receipt of notice from the Agent, or immediately upon
the Borrower's otherwise acquiring notice thereof, prepay the
Revolving Loans, prepay the Additional Loans, pay the
Reimbursement Obligations or cause the reduction or
cancellation of such of the Letters of Credit to the extent
necessary to eliminate such excess or, if such payment or
prepayment, reduction or cancellation does not eliminate such
excess, cause to be deposited with the Agent Cash Collateral
in an amount equal to such excess and in which the Agent is
granted a first-priority Lien for the benefit of the Lenders,
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to secure the Obligations pursuant to documentation in form
and substance satisfactory to the Agent. If at any time the
sum of the aggregate outstanding principal balance of the
Revolving Loans plus the aggregate outstanding principal
balance of the Additional Loans plus the aggregate Stated
Amount of all of the outstanding Letters of Credit plus the
sum of the aggregate outstanding principal balance of the
Reimbursement Obligations should exceed the Borrowing Base
then in effect, such excess nevertheless shall constitute
Obligations that are evidenced by the Credit Documents,
secured by the Collateral and otherwise entitled to all
benefits and security of this Agreement and the other Credit
Documents.
(b) Upon at least thirty (30) days prior to
written notice to the Agent and each Lender, Borrower may, at
its option at any time during the term of this Agreement,
terminate the Revolving Loan Commitments, the Additional Loan
Commitments, or both, in full or reduce all of the Revolving
Loan Commitments, Additional Loan Commitments, or both, in
increments of $100,000 each; provided, however, that (i) the
amount of any such partial reduction shall be applied to all
of the Lenders' Revolving Loan Commitments based on each
Lender's Pro Rata Share of the Total Revolving Loan
Commitments, in the case of any partial reduction of the
Total Revolving Loan Commitments, or to all of the Lenders'
Additional Loan Commitments based on each Lender's Pro Rata
Share of the Total Additional Loan Commitments, in the case
of any such partial reduction of the Total Additional Loan
Commitments, (ii) the sum of the aggregate outstanding
principal balance of all of the Revolving Loans, the
Additional Loans and the Reimbursement Obligations plus the
aggregate Stated Amount of all outstanding Letters of Credit
shall not exceed the reduced total amount of the Total Loan
Commitments after giving effect to any such reduction or
termination (and Borrower shall immediately prepay any
Revolving Loans, prepay any Additional Loans, pay any
Reimbursement Obligations, cause the reduction or
cancellation of any outstanding Letters of Credit or deposit
Cash Collateral with the Agent to the extent necessary to
eliminate such excess), (iii) if any such termination or
reduction would require that any LIBOR Advance be prepaid
prior to the end of its then-current Interest Period,
Borrower shall pay any additional amount due under Section
4.05(e)(ii) hereof, and (iv) any such termination or
reduction shall be irrevocable. In the event any such
termination or reduction is made by Borrower in accordance
with this Section, the Agent will issue to Borrower and each
Lender a revised Annex I to this Agreement reflecting such
termination or reduction, which revised Annex I shall
supersede and
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replace the prior version thereof and shall be substituted by
each party in lieu thereof.
(g) The following new Section 2.04 and Section 2.05 shall
be added to the Credit Agreement:
SECTION 2.04. ADDITIONAL LOAN COMMITMENTS.
(a) Subject to and upon the terms and
conditions set forth in this Agreement (including the terms
and conditions of Section 5.05 hereof), each Lender severally
agrees, upon the Borrower's request, to advance to the
Borrower, from time to time during the Additional Loan
Period, Additional Loans in an aggregate principal amount
outstanding at any one time not to exceed such Lender's
Additional Loan Commitment as in effect at such time;
provided, however, that the Lenders shall not be obligated
hereunder to make Additional Loans at any time if the sum of
the aggregate principal balance of the Additional Loans then
outstanding plus the aggregate principal balance of the
Revolving Loans outstanding plus the aggregate Stated Amount
of all Letters of Credit then outstanding plus the aggregate
principal balance of all Reimbursement Obligations then
outstanding exceeds, or would exceed with the making of any
such Additional Loan, the Borrowing Base then in effect and
provided, further however that no Lender shall be obligated
hereunder to make Additional Loans in excess of such Lender's
Additional Loan Commitment. The Borrower shall be entitled to
borrow, prepay and reborrow Additional Loans from time to
time during the Additional Loan Period in accordance with the
provisions of this Agreement.
(b) The proceeds of the Additional Loans shall
be used solely to finance the working capital and general
corporate needs of the Borrower and its Subsidiaries.
(c) Each Lender's and the Agent's respective
obligations to make Additional Loans hereunder shall expire
on the Additional Loan Commitment Expiration Date. The
Additional Loan Commitment Expiration Date may be extended
with the express prior written consent of the Lenders holding
100% of the Total Additional Loan Commitments but in no event
shall the Additional Loan Commitment Expiration Date be
extended beyond the Revolving Loan Commitment Expiration
Date.
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SECTION 2.05. ADDITIONAL LOAN NOTES; REPAYMENT OF
PRINCIPAL AND INTEREST.
(a) The Borrower's obligation to pay to each
Lender the principal of and interest on the Additional Loans
made by such Lender shall be evidenced by the records of the
Agent and such Lender and by the Additional Loan Note payable
to such Lender.
(b) Accrued interest on the portion of each
Lender's Additional Loans consisting of Prime Rate Advances
or Monthly Rate Advances shall be payable to such Lender in
arrears on the first (1st) day of each calendar month,
commencing with the month following the month in which such
Lender's initial Additional Loan is made, and continuing to
be due on the first (1st) day of each month thereafter, and
accrued interest on the portion of each Lender's Additional
Loans consisting of LIBOR Advances shall be payable to such
Lender in arrears on the last day of each Interest Period
applicable thereto (and, in the case of any LIBOR Advance
having an Interest Period in excess of three months, on each
day which occurs every three months after the initial date of
such Interest Period), and in all cases accrued interest on
each Lender's Additional Loans also shall be payable to such
Lender on the Additional Loan Commitment Expiration Date.
(c) In addition to any principal reduction
which may be required at any time under Section 2.03(a)
hereof, and subject to any acceleration of maturity pursuant
to Section 9.02 hereof, the aggregate principal balance of
each Lender's Additional Loans shall be due and payable in
full on the Additional Loan Commitment Expiration Date.
(h) Section 3.01(a) of the Credit Agreement shall be
amended by deleting clause (iv) thereof and by substituting in lieu thereof the
following new clause (iv):
(iv) No Letter of Credit shall be issued if,
after giving effect to such issuance, (i) the sum of the
aggregate Stated Amount of all Letters of Credit then
outstanding plus the aggregate principal amount of all
Revolving Loans, Additional Loans and Reimbursement
Obligations then outstanding would exceed the Borrowing Base
in effect at such time or (ii) the sum of the aggregate
Stated Amount of all Letters of Credit then outstanding plus
the aggregate principal amount of all Revolving Loans and
Reimbursement Obligations then outstanding would exceed the
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lesser of the Total Revolving Loan Commitments or the
Borrowing Base in effect at such time. All Letters of Credit
shall count against Borrower's availability under the
Revolving Loan facility. In no event shall any Letter of
Credit be issued under the Additional Loan facility.
(i) Section 4.01 of the Credit Agreement shall be
amended by adding to the end thereof the following new sentence:
In addition, each Notice of Borrowing shall specify whether
the requested Loan is a Revolving Loan or an Additional Loan.
(j) Section 4.02(b) of the Credit Agreement shall be
amended by deleting the phrase "Revolving Loan Commitment" and by substituting
in lieu thereof the phrase "Revolving Loan Commitment or Additional Loan
Commitment".
(k) Section 4.02(d) of the Credit Agreement shall be
deleted in its entirety and the following new subsection (d) shall be
substituting in lieu thereof:
(d) All Advances of Revolving Loans under this
Agreement shall be made by the Lenders on the basis of their
Pro Rata Shares of the Total Revolving Loan Commitments and
all advances of Additional Loans under this Agreement shall
be made by the Lenders on the basis of their Pro Rata Shares
of the Total Additional Loan Commitments.
(l) Section 4.03(d) of the Credit Agreement shall be
deleted in its entirety and the following new subsection 4.03(d) shall be
substituted in lieu thereof:
(d) Each Lender's Pro Rata Share of any Loan
outstanding at any one time shall bear interest at the same
rate or rates as then in effect with respect to all other
Lenders' Pro Rata Shares of such Loans.
(m) Section 4.04 of the Credit Agreement shall be
amended by adding the following new subsection (e) thereto:
(e) In consideration of the Lenders making
their Additional Loan Commitments hereunder available to the
Borrower, the Borrower agrees to pay to the Agent (for the
account of and distribution to the Lenders in accordance with
their respective Pro Rata Shares) a non-refundable Commitment
Fee from the date of the Second Amendment until the date all
of the Additional Loan Commitments are terminated in full
pursuant to this Agreement,
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computed on the daily average unused portion of the
Additional Loan Commitments in effect during the period for
which such payment is made (and as such Additional Loan
Commitments may be reduced pursuant to this Agreement), at
the rate per annum of one-eighth of one percent (0.125%).
Such Commitment Fees shall be payable by the Borrower to the
Agent (as aforesaid) quarterly in arrears commencing on April
1, 1997 and continuing to be due on the first (1st) day of
each calendar quarter thereafter so long as any of the
Additional Loan Commitments are in effect as well as on the
date on which all of the Additional Loan Commitments are
terminated in full pursuant to this Agreement.
(n) Section 4.14 of the Credit Agreement shall be
amended by deleting the phrase "Revolving Loan Commitments" and substituting in
lieu thereof the phrase "Revolving Loan Commitments, Additional Loan
Commitments".
(o) Article V of the Credit Agreement shall be amended
by adding the following new Section 5.05 thereto:
SECTION 5.05. ADDITIONAL CONDITIONS PRECEDENT TO THE
MAKING OF ADDITIONAL LOANS. At the time of (and after giving
effect to) the making of any Additional Loan hereunder, the
following conditions shall have been satisfied and shall
exist:
(a) the making of such Additional Loan shall be
permitted by the terms of the Subordinated Note Indenture;
and
(b) the chief financial officer of the Borrower
shall have delivered to the Agent a certificate in the form
of Exhibit J attached hereto, certifying, among other things,
that the requested Additional Loan shall be permitted under
the terms of the Subordinated Note Indenture and shall
constitute "Senior Indebtedness" thereunder.
(p) Article VI of the Credit Agreement shall be amended
by adding thereto the following new Section 6.22:
SECTION 6.22. Borrower represents and warrants to
Lenders that (i) all Indebtedness evidenced by the Revolving
Loans shall be deemed to be "Permitted Indebtedness" under
Section 1008(b)(i) of the Subordinated Note Indenture, (ii)
all Additional Loans shall be permitted by Section 1008(a) of
the Subordinated Note Indenture or Section 1008(b)(ix) of the
Subordinated Note Indenture, and (iii) all Loans shall
constitute "Senior Indebtedness" under the Subordinated Note
Indenture.
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(q) Section 8.08 of the Credit Agreement shall be
deleted in its entirety and the following Section 8.08 shall be substituted in
lieu thereof:
SECTION 8.08. USE OF PROCEEDS. Borrower shall not
use (or permit to be used) the proceeds of any of the
Revolving Loans, the Additional Loans or the Letters of
Credit for any purpose other than as and to the extent
permitted by Section 2.01(b), Section 2.04 or Section
3.01(a)(iii) hereof, respectively.
(r) Article VIII of the Credit Agreement shall be
amended by adding thereto the following new Section 8.11.
SECTION 8.11. INDEBTEDNESS. Borrower will not, and
will not permit any Subsidiary to, create, incur, assume or
suffer to exist any Indebtedness, except (i) Indebtedness
evidenced by or arising under the Credit Agreement or any of
the other Credit Documents, (ii) Indebtedness in existence on
the date hereof, (iii) Capitalized Lease Obligations, (iv)
Indebtedness of the Borrower or any Subsidiary as an account
party for any letter of credit issued by any financial
institution if such letter of credit is issued solely as
security for performance or payment by the Borrower or such
Subsidiary under any contract which is not otherwise
prohibited by this Agreement and which has been entered into
in the ordinary course of business of the Borrower or such
Subsidiary, and (v) renewals and extensions of any of the
Indebtedness described in clauses (i) through (iv) above
provided that the original principal amount thereof is not
increased.
(s) Section 11.05(b)(ii) of the Credit Agreement shall
be amended by deleting the phrase "Revolving Loan Commitments" and by
substituting in lieu thereof the phrase "Revolving Loan Commitments or
Additional Loan Commitments, as the case may be,".
(t) Section 11.05(e), (f) and (g) of the Credit
Agreement shall be amended by (i) deleting the phrase "Revolving Loan
Commitment" and by substituting in lieu thereof the phrase "Revolving Loan
Commitment or Additional Loan Commitment" and (ii) deleting the phrase
"Revolving Loan Commitment Expiration Date" and by substituting in lieu thereof
the phrase "Revolving Loan Commitment Expiration Date or Additional Loan
Commitment Expiration Date".
(u) Section 11.08(a) of the Credit Agreement shall be
amended by (i) deleting the phrase "Revolving Loan Commitment" and by
substituting in lieu thereof the phrase "Revolving Loan Commitment or
Additional Loan Commitment", (ii) deleting the phrase "Revolving Loan
Commitment Expiration Date" and by substituting in lieu thereof the phrase
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"Revolving Loan Commitment Expiration Date or Additional Loan Commitment
Expiration Date and (iii) adding to the end thereof the following new sentence:
In addition, notwithstanding anything herein to the contrary,
Lenders holding 100% of the Total Additional Loan Commitments
may (i) waive any of the conditions specified in Section 5.05
hereof, (ii) decrease any of the Additional Loan Commitments,
(iii) reduce the principal of, or interest on, any of the
Additional Loans or Additional Loan Commitments, (iv) extend
the Additional Loan Commitment Expiration Date but in no
event shall the Additional Loan Commitment Expiration Date be
extended beyond the Revolving Loan Commitment Expiration
Date, (v) postpone any date fixed for the payment of any
principal, interest or fees due under or with respect to the
Additional Loans or the Additional Loan Commitments or (vi)
change the percentage of any of the Additional Loan
Commitments or the aggregate unpaid principal amount of the
Additional Loans; provided, however that all such amendments,
waivers or consents shall not be effective unless in writing
and signed by the Agent and the Lenders holding 100% of the
Total Additional Loan Commitments.
(v) The Credit Agreement shall be amended by deleting
Annex I, Exhibit F and Exhibit H thereto and by substituting in lieu thereof
the new Annex I, Exhibit F and Exhibit H attached hereto and which is herein
incorporated by this reference.
(w) The Credit Agreement shall be amended by adding
thereto Exhibit A-1 and Exhibit J attached hereto.
2. WAIVER. Borrower has requested that Lenders waive the
restrictions and prohibitions set forth in Section 8.03 of the Credit Agreement
so as to permit XxXxxxx Air Systems, Inc., a wholly-owned subsidiary of
Borrower ("LASI"), to convey all or substantially all of its assets and/or
rights therein (the "Conveyance") to a joint venture, in the form of a newly
formed Delaware corporation, of which LASI shall be a 50% holder of the Voting
Stock. Subject to the terms and conditions set forth in the immediately
succeeding sentence, the Agent and the Lenders hereby waive the restrictions
and prohibitions set forth in Section 8.03 of the Credit Agreement with respect
to the Conveyance so as to permit LASI to consummate the same without causing
Borrower to be in violation of such Section 8.03. The Agent's and the Lenders'
consent to the Conveyance is subject to the following: (i) on the date that the
Conveyance is consummated, and after giving effect thereto, all representations
and warranties of the Borrower in the Credit Agreement and the other Credit
Documents shall be true, correct and complete in all material respects and (ii)
after giving effect to the waiver to be effected hereby, no Default or Event of
Default shall be caused by the consummation of the Conveyance.
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3. NO OTHER AMENDMENTS OR WAIVER. Except for the
amendments and waiver expressly set forth and referred to in Section 1 and
Section 2 above, the Credit Agreement shall remain unchanged and in full force
and effect. Nothing in this Amendment is intended, or shall be construed, to
constitute a novation or an accord and satisfaction of any of the Borrower's
indebtedness or other indebtedness to the Lender under or in connection with
the Credit Agreement (collectively, the "Obligations") or to modify, affect or
impair the perfection or continuity of Lender's security interests in, security
titles to or other liens on any collateral for the Obligations.
4. REPRESENTATIONS AND WARRANTIES. To induce Lender to
enter into this Amendment, the Borrower does hereby warrant, represent and
covenant to Lender that: (a) each representation or warranty of the Borrower
set forth in the Credit Agreement is hereby restated and reaffirmed as true and
correct on and as of the date hereof as if such representation or warranty were
made on and as of the date hereof (except to the extent that any such
representation or warranty expressly relates to a prior specific date or period
and except as otherwise disclosed on Schedule 1 attached hereto), and no
Default or Event of Default has occurred and is continuing as of this date
under the Credit Agreement as amended by this Amendment; and (b) Borrower has
the power and is duly authorized to enter into, deliver and perform this
Amendment and this Amendment is the legal, valid and binding obligation of
Borrower enforceable against it in accordance with its terms.
5. CONDITIONS PRECEDENT TO EFFECTIVENESS OF THIS
AMENDMENT. The effectiveness of this Amendment and the amendments and waiver
provided in Section 1 and Section 2 above are subject to (a) the truth and
accuracy in all material respects of the representations and warranties of the
Borrower contained in Section 4 above and (b) the Agent's receipt of the
following documents in form and substance satisfactory to the Agent: (i) one or
more counterparts of this Amendment duly executed and delivered by the Borrower
and the Lenders; (ii) an Additional Loan Note payable to the order of each of
NationsBank, N.A. (South) and Hibernia National Bank in the amount of its
Additional Loan Commitment as shown on the revised Annex I attached hereto and
duly executed and delivered by Borrower; (iii) an Additional Loan Request
Certificate of the Borrower in the form of Exhibit J attached hereto duly
executed and completed by Borrower and (iv) a Certificate of the Borrower
substantially in the form and substance satisfactory to Lenders.
6. AGENT EXPENSES. Without limiting its obligations
under the Credit Agreement, the Borrower agrees to pay on demand all of the
Agent's reasonable attorneys' fees and expenses and all other reasonable
out-of-pocket costs incurred by the Agent in connection with its evaluation,
negotiation, documentation or consummation of this Amendment and the
transactions contemplated hereby or thereby.
7. COUNTERPARTS. This Amendment may be executed in
multiple counterparts, each of which shall be deemed to be an original and all
of which when taken together shall constitute one and the same instrument.
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8. GOVERNING LAW. This Amendment shall be governed by,
and construed in accordance with, the internal laws of the State of Georgia
applicable to contracts made and performed in such state.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered as of the day and year specified at
the beginning hereof.
XXXXXXX INDUSTRIES INC.
By:/s/ Xxxxxx X. Xxxxxxx
---------------------------------
Title: CFO & VP
------------------------------
NATIONSBANK, N.A. (SOUTH), as
Agent and as a Lender
By:/s/ Xxxx X. Xxxxxxxx
---------------------------------
Title: Vice President
------------------------------
DEPOSIT GUARANTY NATIONAL
BANK, as a Lender
By:/s/ Xxxxx X. Xxxxxxxx S&P
---------------------------------
Title: Senior Vice President
------------------------------
HIBERNIA NATIONAL BANK, as a
Lender
By:/s/ Xxxxx X. Xxxxxx
---------------------------------
Title: Vice President
------------------------------
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ANNEX I
Lender Information
1. Name of Lender: NATIONSBANK, N.A.(SOUTH)
Address for Notices: 000 Xxxxxxxxx Xxxxxx, X.X.
00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxxxx X. Xxxxxx
Telecopy No.: (000) 000-0000
Revolving Loan Commitment*: $20,000,000
Additional Loan Commitments*: $ 4,000,000
Pro Rata Share of the Total
Revolving Loan Commitments*: 50%
Pro Rata Share of the Total
Additional Loan Commitments*: 80%
2. Name of Lender: DEPOSIT GUARANTY NATIONAL BANK
Address for Notices: Xxx Xxxxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attn: Xxxxxxx Xxxxx, Vice President
Telecopy No.: (000) 000-0000
Revolving Loan Commitment*: $12,000,000
Additional Loan Commitment*: $0
Pro Rata Share of the Total
Revolving Loan Commitments*: 30%
Pro Rata Share of the Total
Additional Loan Commitments*: 0%
3. Name of Lender: HIBERNIA NATIONAL BANK
Address for Notices: 000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxxx Xxxxx
Telecopy No.: (000) 000-0000
Revolving Loan Commitment*: $8,000,000
Additional Loan Commitment*: $1,000,000
Pro Rata Share of the Total
Revolving Loan Commitments*: 20%
Pro Rata Share of the Total
Additional Loan Commitments*: 20%
* Subject to change in accordance with the terms of the within and foregoing
Credit Agreement.
ANNEX I
15
EXHIBIT A-1
ADDITIONAL LOAN NOTE
U.S. $_______ March _, 1997
FOR VALUE RECEIVED, the undersigned XXXXXXX INDUSTRIES INC., a Delaware
corporation (the "Borrower"), hereby promises to pay to the order of __________
(herein, together with any subsequent holder hereof, called the "Lender"), the
lesser of _____________ MILLION U.S. DOLLARS (U.S.$__________ ) or the aggregate
outstanding principal amount of the Additional Loans made to the Borrower by
Lender pursuant to the terms of the Credit Agreement referred to below, which
principal sum shall be payable (i) on the due date and in the amount set forth
in the Credit Agreement or (ii) on any earlier date on which all amounts
outstanding under this Additional Loan Note (this "Note") have become due and
payable pursuant to the provisions of Article IX of the Credit Agreement. The
Borrower likewise promises to pay interest on the outstanding principal balance
of each Additional Loan made by the Lender to the Borrower, at such interest
rates, payable at such times, and computed in such manner, as are specified in
the Credit Agreement in strict accordance with the terms thereof.
This Note is issued pursuant to, and is one of the Additional Loan
Notes referred to in, the Credit Agreement dated as of August 17, 1994, among
the Borrower, NationsBank, N.A. (South), as Agent, the Lender, and the other
Lenders which are or may become signatories to such Credit Agreement (as the
same may be amended from time to time, the "Credit Agreement"), and the Lender
is and shall be entitled to all benefits thereof and of all the Credit Documents
executed and delivered to the Agent or the Lenders in connection therewith.
Terms defined in the Credit Agreement are used herein with the same meaning. The
Credit Agreement, among other things, contains provisions for acceleration of
the maturity hereof upon the happening of certain Events of Default, provisions
relating to prepayments on account of principal hereof prior to the maturity
hereof, and provisions for post-default interest rates.
The Borrower agrees to make payments of principal and interest hereon
on the dates and in the amounts specified in the Credit Agreement in strict
accordance with the terms thereof.
In case an Event of Default shall occur and be continuing, the
principal and all accrued interest of this Note may automatically become, or may
be declared, immediately due and payable in the manner and with the effect
provided in the Credit Agreement. The Borrower agrees to pay, and save the
Lender harmless against any liability for the payment of, all reasonable costs
and expenses, including reasonable attorneys' fees, actually incurred by Lender
in connection with the enforcement by the Lender of any of its rights or
remedies under this Note or the Credit Agreement.
This Note has been delivered in Atlanta, Georgia, and the rights and
obligations of the Lender and the Borrower hereunder shall be construed in
accordance with and governed by the laws of the State of Georgia (without giving
effect to its conflicts of law rules).
A-1-1
16
The Borrower expressly waives any presentment, demand, protest or
notice in connection with this Note, whether now or hereafter required by
applicable law. This Note is intended to be an instrument under seal.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed,
sealed and delivered by its duly authorized officers as of the date first above
written.
XXXXXXX INDUSTRIES INC.
(CORPORATE SEAL)
Attest
By:
------------------------
--------------------------------- Title:
Title: ------------------
---------------------------
A-1-2
17
EXHIBIT F
ASSIGNMENT AND ACCEPTANCE AGREEMENT
THIS ASSIGNMENT AND ACCEPTANCE AGREEMENT is made as of
_________________________, 19___, between _________________________________, a
____________________________ (the "Assignor") and _________________________, a
____________________________ (the "Assignee"), which parties, for good and
valuable consideration, do hereby agree as follows with reference to the Credit
Agreement described below:
1. The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, an interest in and to
(i) all of the Assignor's rights and obligations under the Assignor's [Revolving
Loan Note/Additional Loan Note/Notes], and all of Assignor's rights and
obligations under the Credit Agreement and the Credit Documents relating
thereto, (ii) the Assignor's [Revolving Loan Commitments/Additional Loan
Commitments/Revolving Loan Commitments and Additional Loan Commitments], [and]
(iii) the Assignor's [Revolving Loans/Additional Loans/Loans], [and (iv) the
Assignor's Letter of Credit Interest], all as of the Effective Date (as defined
below), constituting as of such Effective Date an interest equal to [___ % of
the Assignor's Revolving Loan Commitments, Letter of Credit Interest and
Revolving Loans outstanding on the Effective Date [and] ____ % of the
Assignor's Additional Loan Commitments and Additional Loans outstanding on the
Effective Date].
2. The Assignor: (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is, to the best of the Assignor's knowledge, free and clear of any
adverse claim; (ii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Credit Document
or with respect to the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any of the other
Credit Documents; and (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of its obligations under the Credit
Agreement or the other Credit Documents.
3. The Assignee: (i) has received a copy of the Credit Agreement, the
Assignor's [Revolving Loan Note/Additional Loan Note] and the Security
Documents, together with copies of such financial statements and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance Agreement;
(ii) agrees that it will, independently and without reliance upon the Agent, the
Assignor or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement or the other Credit
Documents; (iii) appoints and authorizes the Agent to take such action as agent
on its behalf and to exercise such powers under the Credit Agreement as are
delegated to the Agent by the terms thereof, together with such powers as are
incidental thereto; (iv) agrees that it will perform in accordance with their
terms all of the obligations which
F-1
18
by the terms of the Credit Agreement are required to be performed by it as a
Lender; and (v) specifies as its address and telecopier number for notices the
address and telecopier number set forth beneath its name on the signature pages
hereof.
4. The effective date for this Assignment and Acceptance Agreement
shall be _____, 19___ (the "Effective Date"), which date is no less than five
(5) Business Days after the date hereof. Following the execution of this
Assignment and Acceptance Agreement, it will be delivered to the Borrower
and to the Agent for acceptance by the Borrower and the Agent pursuant to
Section 11.05 of the Credit Agreement.
5. As of the Effective Date, and upon acceptance by the Assignee, to
the extent provided in this Assignment and Acceptance Agreement and to the
extent of the rights assigned hereunder, (i) the Assignee shall be a party to
the Credit Agreement and have the rights and obligations of a Lender thereunder
for the benefit of the Borrower, the other Lenders and the Agent; (ii) the
Assignee shall enjoy the benefits of the Credit Documents; and (iii) the
Assignor shall, to the extent provided in this Assignment and Acceptance
Agreement, relinquish its rights and be released from its obligations under the
Credit Agreement.
6. Upon such acceptance and from and after the Effective Date, the
Agent shall make all payments under the Credit Agreement and the [Revolving Loan
Note/Additional Loan Note] in respect (and to the extent) of the interest
assigned hereby (including, and without limitation, all payments of principal,
interest and fees with respect thereto) to the Assignee. The Assignor and
Assignee shall make all appropriate adjustments in payments under the Credit
Agreement and the [Revolving Loan Note/Additional Loan Note] for periods prior
to the Effective Date directly between themselves.
7. All terms used in this Assignment and Acceptance Agreement and not
otherwise defined herein shall have the meanings given those terms in the Credit
Agreement (the "Credit Agreement"), dated as of August 17, 1994, among XxXxxxx
Industries Inc., NationsBank, N.A. (South), acting in its capacity as Agent, and
the banks and other lending institutions which are or may become Lenders as
provided in such Credit Agreement, as said agreement may be amended,
supplemented or restated from time to time.
8. This Assignment and Acceptance Agreement shall be governed by, and
construed in accordance with, the laws of the State of Georgia (without giving
effect to its conflicts of law rules).
F-2
19
IN WITNESS WHEREOF, the Assignor and Assignee have caused their
respective duly authorized officers to execute this Assignment and Acceptance
Agreement on their behalf as of the day and year first above set forth.
[ASSIGNOR)
By:
----------------------------
Title:
----------------------
[ASSIGNEE]
By:
----------------------------
Title:
----------------------
Address and Telecopier Number:
-------------------------------
-------------------------------
Attn:
--------------------------
Telecopier: ( ) -
--- ----- --------
Accepted this ____ day of _________,
19____:
XXXXXXX INDUSTRIES INC.
By:
----------------------------
Title:
----------------------
NATIONSBANK, N.A. (SOUTH), as Agent
By:
----------------------------
Title:
----------------------
F-3
20
EXHIBITS H
BORROWING BASE REPORT FOR XXXXXXX INDUSTRIES INC. (the "Borrower")
AS OF_______, 199__ *
($000's)
ACCOUNTS:
Current $
----------
31-60 Days Past Due $
----------
61-90 Days Past Due $
----------
91 + Days Past Due $
----------
Total Accounts Per Aging $
----------
Ineligibles:
Over 60 Days Past Due $
----------
Cross Aging $
----------
Governmental $
----------
Current Doubtful $
----------
Other (Non-Trade) $
----------
A/P Contras $
----------
Total Ineligible Accounts $
----------
Eligible Accounts $
----------
AVAILABLE ACCOUNTS BORROWING $
BASE COMPONENT @85% ----------
INVENTORY:
Total Materials Inventory $
----------
Inventory Reserves $
----------
Inventory at Average Cost $
----------
IPG Equipment $
----------
Inventory Accruals $
----------
Total Gross Inventory $
Ineligibles: ----------
Drop Ship $
----------
Containers & Supplies $
----------
Slow Moving $
----------
Waivers $
----------
Outside Processors $
----------
Total Ineligible Inventory $
----------
Eligible Inventory $
AVAILABLE ACCOUNTS BORROWING ----------
BASE COMPONENT @ 50%
(not to exceed $15,000,000) $
AVAILABLE ACCOUNTS BORROWING ----------
BASE (not to exceed $45,000,000 in total) $
==========
CERTIFICATION
Pursuant to the terms of the Credit Agreement, dated as of August 17,
1994, among Borrower, NationsBank, N.A. (South), as Agent, and the lenders
signatory thereto, as now in effect (the "Credit Agreement"), the undersigned
hereby provides the Lenders and the Agent with this Borrowing Base Report of the
Borrower. The undersigned Borrower representative certifies that the information
contained herein is accurate and complete to the best of his/her knowledge and
belief. Each of the Lenders and the Agent may rely on any telecopied version of
this report which it believes in good faith to have been telecopied to it by or
on behalf of the Borrower and it shall not be necessary for such Lender or the
Agent to receive or retain the executed original of this report.
XxXXXXX INDUSTRIES INC.
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
Date:
-----------------------------
* All capitalized terms used herein shall have the meanings given such terms
in the Credit Agreement as defined herein).
21
EXHIBIT J
ADDITIONAL LOAN REQUEST CERTIFICATE
The undersigned chief financial officer of XXXXXXX INDUSTRIES INC. (the
"Corporation"), a Delaware corporation, hereby certifies and covenants in his
representative capacity on behalf of the Corporation as follows:
1. All capitalized terms used herein and not otherwise defined herein
shall have the meanings given such terms in the Credit Agreement dated as of
August 17, 1994 among the Corporation, the Lenders signatory thereto (the
"Lenders") and NationsBank, N.A. (South) as agent for the Lenders (the "Agent"),
as amended from time to time (the "Credit Agreement").
2. The undersigned is the duly elected and qualified chief financial
officer of the Corporation and, as such, is familiar with the facts herein
certified.
3. The Corporation has requested on this date an Additional Loan and is
delivering this certificate to the Agent pursuant to Section 5.05 of the Credit
Agreement.
4. No Default or Event of Default (as such terms are defined in the
Credit Agreement) has occurred and is continuing as of this date.
[5. For purposes of this paragraph 5, all capitalized terms used in
this paragraph 5 unless otherwise defined herein shall have the meanings given
such terms in the Indenture dated as of August 17, 1994 between the Corporation
and NationsBank, N.A. (South) as Trustee (hereinafter called the "Indenture").
After giving effect to the incurrence of the indebtedness evidenced by the
Additional Loan requested to be made by the Corporation on this date (the "New
Indebtedness"), the Consolidated Fixed Charge Coverage Ratio for the Corporation
for the four full fiscal quarters immediately preceding the incurrence of the
New Indebtedness taken as one period and after giving pro forma effect to (i)
the incurrence of the New Indebtedness and (if applicable) the application of
the net proceeds therefrom, including to refinance other Indebtedness, as if the
New Indebtedness was incurred, and the application of such proceeds occurred, at
the beginning of such four-quarter period; (ii) the incurrence, repayment or
retirement of any other Indebtedness by the Corporation and its Subsidiaries
since the first day of such four-quarter period as if the Indebtedness was
incurred, repaid or retired at the beginning of such four-quarter period (except
that, in making such computation, the amount of Indebtedness under any revolving
credit facility shall be computed based upon the average daily balance of such
Indebtedness during such four-quarter period); (iii) in the case of Acquired
Indebtedness, the related acquisition, as if such acquisition occurred at the
beginning of such four-period; and (iv) any acquisition or disposition by the
Corporation and its Subsidiaries of any company or business or any assets out of
the ordinary course of business, whether by merger, stock purchase or sale or
asset purchase or sale or any related payment of Indebtedness, in each case
since the first day of such four-quarter period, assuming such acquisition or
disposition had been consummated on the first day of such four-quarter period)
is at least equal to 2.50:1.0.
J-1
22
Accordingly, the New Indebtedness shall be Senior Indebtedness and Schedule A
attached hereto sets forth the calculations demonstrating in reasonable detail
that the New Indebtedness is "Permitted Indebtedness" under Section 1008(a) of
the Subordinated Note Indenture].
[5. For purposes of this paragraph 5, all capitalized terms used in
this paragraph 5 unless otherwise defined herein shall have the meanings given
such terms in the Indenture dated as of August 17, 1994 between the Corporation
and NationsBank, (South) as Trustee (hereinafter called the "Indenture"). After
giving effect to the incurrence of the indebtedness evidenced by the Additional
Loan requested to be made by the Corporation on this date (the "New
Indebtedness"), the aggregate principal amount of all Indebtedness of the
Corporation in addition to that described in clauses (i) through (viii) of
Section 1008(b) of the Indenture, and any renewals, extensions, substitutions,
refinancings or replacements of such Indebtedness, does not exceed $10,000,000.
Accordingly, the New Indebtedness shall be Senior Indebtedness and Schedule A
attached hereto sets forth the calculations demonstrating in reasonable detail
that the New Indebtedness is "Permitted Indebtedness" under Section 1008(b)(ix)
of the Subordinated Note Indenture.]
6. The aggregate outstanding principal amount of the USX Notes (as
defined in the Indenture) as of the date hereof is less than $16,000,000.
7. After giving effect to the Corporation's incurrence of the
Indebtedness evidenced by the Additional Loan requested by the Corporation on
this date, on a pro forma basis, (A) the Corporation shall have maintained, for
the twelve-month period ending immediately prior to the date that the
Indebtedness was incurred, a ratio of (x) Cash Flow for such period minus
Capital Expenditures for such period to (y) Debt Service for such period of at
least 1.25 to 1.0 and (B) the amount of the Indebtedness does not exceed,
singularly or together with all Permitted Dividends previously made pursuant to
the USX Notes, 80% of the Corporation's net income for its previous fiscal year.
For purposes of this paragraph 7, all capitalized terms used in this paragraph 7
unless otherwise defined herein shall have the meanings given such terms in the
XxXxxxx Industries Inc. Amended and Restated 10% Secured Note due May 1, 2000.
Schedule B attached hereto sets forth the calculations demonstrating in
reasonable detail compliance with this paragraph 7.
IN WITNESS WHEREOF, the undersigned have hereunto set their
signatures and the seal of the Corporation as of this_______day of_______,
________ .
__________________________
Name: _______________, Chief
Financial Officer
J-2
23
Schedule 1
1. With respect to Section 6.13, as previously reported to Lenders:
As previously disclosed, on June 27, 1996, Marathon Pipe Line Company
and Marathon Oil Company (collectively, "Marathon") filed a complaint
against the Borrower and one other company in the United States
District Court for the Eastern District of Louisiana alleging that the
Borrower or its agents damaged a gasoline pipeline belonging to
Marathon causing it to rupture and release gasoline into the Blind
River and surrounding area near Gramercy, Louisiana. In connection with
the gasoline release, a class action petition was filed on May 28, 1996
by Xxxxxxx Xxxxxxx and certain other named petitioners ("Petitioners")
on behalf of persons and entities allegedly sustaining direct and/or
consequential damage as a result of the gasoline release in the 23rd
Judicial District Court for the Parish of St. Xxxxx, Louisiana against
Marathon. On September 19, 1996, the Petitioners amended their original
petition to add the Borrower as a defendant to the class action
lawsuit. The Borrower is continuing a diligent investigation of the
situation in order to evaluate the allegations and the relative
responsibility of the parties involved. The Borrower is also responding
to inquiries from regulatory authorities of the State of Louisiana
related to the gasoline release. If appropriate, the Borrower will
vigorously defend itself against all claims. Because the investigation
is in a preliminary stage, it is not possible to predict whether the
company will incur any liability for the rupture and release or
reasonably to estimate the cost of any possible liability.
2. With respect to Section 6.16:
The Labor Agreement between XxXxxxx and the Federated Aluminum Counsel
Inc. for represented employees at the Baton Rouge plant expired on
October 1, 1996 after negotiations for a new agreement were
unsuccessful. No work stoppage has occurred and operations continued.
On November 6, 1996, the company implemented its final negotiating
offer. The bargaining unit has continued to function under the terms of
the final implemented offer. The union has not requested any further
meetings with the company.
