EXHIBIT 99.1
FOURTH AMENDMENT TO
FOURTH AMENDED AND RESTATED
FINANCING AGREEMENT
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THIS FOURTH AMENDMENT TO FOURTH AMENDED AND RESTATED FINANCING
AGREEMENT ("Fourth Amendment") is made and entered into as of the 13/th/ day of
November, 1998, by and among BANK ONE, INDIANA, NATIONAL ASSOCIATION ("Bank
One"), THE CIT GROUP/BUSINESS CREDIT, INC. ("CITBC"), DRESDNER BANK AG, NEW
YORK AND GRAND CAYMAN BRANCHES ("Dresdner"), KEYBANK NATIONAL ASSOCIATION
("KeyBank"), PARIBAS ("Paribas"; Bank One, CITBC, Dresdner, KeyBank and Paribas
being herein referred to collectively as the "Initial Lenders"), Bank One, as
agent for the Lenders (the "Agent"), DELCO REMY AMERICA, INC., NABCO, INC., A&B
ENTERPRISES, INC., DALEX, INC., A&B CORES, INC., R&L TOOL COMPANY, INC., MCA,
INC. OF MISSISSIPPI, FRANKLIN POWER PRODUCTS, INC., INTERNATIONAL FUEL SYSTEMS,
INC., POWER INVESTMENTS MARINE, INC., MARINE CORPORATION OF AMERICA, POWRBILT
PRODUCTS, INC., WORLD WIDE AUTOMOTIVE, INC., TRACTECH, INC., and KRAFTUBE, INC.
(collectively, the "Companies"), DELCO REMY INTERNATIONAL, INC., REMAN HOLDINGS,
INC., THE A&B GROUP, INC., POWER INVESTMENTS, INC., REMY INTERNATIONAL, INC.,
and BALLANTRAE CORPORATION (collectively, the "Guarantors"), XXXXXXXX
TECHNOLOGIES, INC. ("Xxxxxxxx") and WESTERN REMAN, INC. ("Western").
RECITALS
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1. The Companies, the Guarantors, the Initial Lenders, and the Agent are
parties to a Fourth Amended and Restated Financing Agreement, dated as of
December 16, 1997, as amended by the First Amendment to Fourth Amended and
Restated Financing Agreement, executed September 11, 1998, and by the Second
Amendment to Fourth Amended and Restated Financing Agreement dated as of October
24, 1998, each among the Companies, the Guarantors, Bank One, CITBC, Dresdner,
Toronto Dominion (Texas), Inc., Paribas, and the Agent, and by the Third
Amendment to Fourth Amended and Restated Financing Agreement, dated as of
November 12, 1998, among the Companies, the Guarantors, the Initial Lenders,
Toronto Dominion (Texas), Inc., and the Agent (the "Original Agreement").
2. Prior to the execution of this Agreement, the Companies and the other
Credit Parties requested the Initial Lenders to make Revolving Loan advances to
the Companies pursuant to Section 3.1 of the Original Agreement in the aggregate
amount of $41,298,150.00 (the "Requested Advance"), to finance the acquisition
by Reman Holdings of 100% of the issued and outstanding capital stock of
Xxxxxxxx (the "Xxxxxxxx Acquisition"), and requested the Initial Lenders and the
Agent to amend the Original Agreement, immediately upon making the Requested
Advance and the concurrent consummation of the Xxxxxxxx Acquisition, to increase
the Line of Credit and to otherwise modify its terms as provided in this Fourth
Amendment. Western is a wholly-owned Subsidiary of Power which is to become a
"Company" (as such term is defined in the Financing Agreement) at the same time
as Western. The Initial Lenders and the Agent are willing to amend the Original
Agreement as set forth in this Fourth Amendment, subject to the terms and
conditions stated in this Fourth Amendment.
AGREEMENT
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NOW THEREFORE, each of the Companies, the Guarantors, Xxxxxxxx, Bank One,
CITBC, Dresdner, KeyBank, Paribas, and the Agent agree as follows:
1. Definitions. All terms used in the Recitals and in this Fourth
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Amendment that are defined in the Original Agreement and are not otherwise
defined herein are used in this Fourth Amendment with the meanings ascribed to
them in the Original Agreement, as amended by this Fourth Amendment.
2. Representations and Warranties. Each of the Companies, the
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Guarantors, Xxxxxxxx and Western represents and warrants to the Lenders and the
Agent as follows:
(a) no Default or Event of Default has occurred and is continuing.
(b) after giving effect to the amendments set forth in this Fourth
Amendment, all of the representations and warranties contained in the Original
Agreement are correct in all material respects on and as of the date of this
Fourth Amendment as though made on and as of such date (except to the extent
that such representations and warranties expressly relate to an earlier date);
(c) it has the corporate power and requisite authority, and has taken
all corporate action necessary, to execute, perform and deliver this Fourth
Amendment;
(d) the execution, delivery and performance of this Fourth Amendment
and the Loan Instruments to which it is a party, the consummation of the
transactions contemplated hereby and thereby (collectively, the "Transactions"),
and compliance with the terms hereof and thereof, will not contravene or
conflict with any provision of law to which it is subject or any material
judgment, license, order or permit applicable to it, or any material contracts
lease, indenture, loan agreement, mortgage, deed of trust or other agreement or
instrument to which it is a party or by which it may be bound or to which it may
be subject, or violate any provision of its charter or by-laws, which could
reasonably be expected, in any case, to have a Material Adverse Effect;
(e) no consent, approval, authorization or order of any Government
Authority or other Person is required in connection with the consummation of the
Transactions, except for such required consents, approvals and authorizations
which (i) have been obtained by it or permanently waived in writing or (ii) the
failure to obtain could not reasonably be expected to have a Material Adverse
Effect; and
(f) each of this Fourth Amendment and the other Loan Instruments to
which it is a party has been duly executed and delivered by it and is, or will
be, the legal and binding obligation
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of it, enforceable in accordance with its terms, subject to applicable laws of
bankruptcy, insolvency, and similar laws affecting creditors' rights and the
application of general rules of equity.
3. Joinder Agreement of Xxxxxxxx and Western.
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(a) Pursuant to the terms of SECTION 8.11 of the Original Agreement,
by their respective execution of this Fourth Amendment, Xxxxxxxx and Western
each is hereby deemed to have executed and delivered the Original Agreement and
shall hereby become (without further action on the part of Xxxxxxxx, Western or
any other party) subject to and bound by the terms of the Financing Agreement as
fully as if Xxxxxxxx and Western each were as at the Fourth Amendment Effective
Date a signatory thereto as a Company and a Credit Party and for all purposes
shall be deemed to be and shall be a Company and a Credit Party under the
Financing Agreement as of the Fourth Amendment Effective Date with all of the
rights and obligations of a Company and a Credit Party thereunder, by virtue
thereof or pursuant thereto. Accordingly, the terms "Company" and "Companies"
as defined in the Original Agreement each are amended as of the Fourth Amendment
Effective Date to include Xxxxxxxx and Western. Without limiting the generality
of the foregoing, Xxxxxxxx and Western each grant to the Agent, for the ratable
benefit of the Lenders and the Agent, a continuing lien and security interest in
all of its Inventory, Equipment, Accounts, Documents of Title, General
Intangibles, Intellectual Property, Investment Property, Real Estate, Other
Collateral, and all Proceeds of any of the foregoing, all whether now owned or
existing or hereafter acquired or arising, as security for the prompt payment in
full of the Obligations in accordance with the terms of SECTION 6 of the
Financing Agreement. Xxxxxxxx and Western each further acknowledges that upon
request of the Lenders, it will grant to the Agent, for the benefit of the
Lenders, mortgages, leasehold mortgages and deeds of trust on Real Estate owned
or leased by it to the extent required by SECTION 6.7 of the Financing
Agreement.
(b) Xxxxxxxx and Western each agree to execute and deliver to the
Agent, for the benefit of the Lenders and the Agent, such documents,
instruments, and agreements as the Lenders may deem necessary or appropriate by
which Xxxxxxxx and Western each shall become subject to and agree to be bound by
the terms of any other Loan Instrument to which the Companies are parties as
fully as if Xxxxxxxx and Western were was a party thereto as of the Fourth
Amendment Effective Date and for the creation, perfection, preservation, and
protection of liens and security interests in favor of the Agent, for the
benefit of the Lenders, in the Collateral of Xxxxxxxx and Western. Without
limiting the generality of the foregoing, Xxxxxxxx and Western each hereby
agrees to and shall become (without further action on the part of Xxxxxxxx,
Western or any other party) subject to and bound by the terms of the following
Loan Instruments as fully as if Xxxxxxxx and Western, each as a Company under
the Original Agreement, as amended hereby, were parties thereto as of the Fourth
Amendment Effective Date:
(i) Second Amended and Restated Consolidated Guaranty, dated December
16, 1997, executed by the Companies in favor of the Lenders.
(ii) Amended and Restated Environmental Indemnity Agreement, dated
December 16, 1997, executed by the Companies in favor of the
Lenders.
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4. Amendments to Original Agreement.
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(a) Amendments to Definitions. Each of the following definitions,
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which are set out in Section 1.1 of the Original Agreement, are amended and
restated in their respective entireties as of the Fourth Amendment Effective
Date to read as follows:
"AGENT FEE" shall mean a fee in an amount to be established by the
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Agent and the Companies from time to time by separate written agreement, which
fee shall be paid to the Agent for its own account in accordance with SECTION
9.7 of this Financing Agreement for performing the services of the Agent
hereunder.
"APPLICABLE LOC FEE PERCENTAGE" shall mean (i) 2.000% per annum, from
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the Fourth Amendment Effective Date through April 30, 1999, and (ii) thereafter
the percentage per annum determined by reference to the Ratio of Total Funded
Debt to EBITDA in accordance with the following table:
Ratio of Total Funded Debt
to EBITDA Applicable LOC Fee Percentage
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4.50 or above 2.000%
4.00 to 4.49 1.750%
3.50 to 3.99 1.625%
3.00 to 3.49 1.500%
2.50 to 2.99 1.375%
2.00 to 2.49 1.250%
less than 2.00 1.125%
The Applicable LOC Fee Percentage in effect in any fiscal quarter of Parent
ending on or after May 1, 1999, will be determined on the basis of the
Applicable LOC Fee Percentage in effect during the preceding fiscal quarter of
Parent until an adjustment is made as provided pursuant to the provisions of the
definition of "Ratio of Total Funded Debt to EBITDA" herein.
"APPLICABLE UNUSED COMMITMENT FEE PERCENTAGE" shall mean (i) 0.50% per
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annum, from the Fourth Amendment Effective Date through April 30, 1999, and (ii)
thereafter, the percentage per annum determined by reference to the Ratio of
Total Funded Debt to EBITDA in accordance with the following table:
Ratio of Total Funded Debt Applicable Unused
to EBITDA Commitment Fee Percentage
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4.50 or above 0.50%
4.00 to 4.49 0.375%
3.50 to 3.99 0.3125%
3.00 to 3.49 0.3125%
2.50 to 2.99 0.25%
2.00 to 2.49 0.25%
less than 2.00 0.15%
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The Applicable Unused Commitment Fee Percentage in effect in any fiscal quarter
of Parent ending on or after May 1, 1999, will be determined on the basis of the
Applicable Unused Commitment Fee Percentage in effect during the preceding
fiscal quarter of Parent until an adjustment is made as provided pursuant to the
provisions of the definition of "Ratio of Total Funded Debt to EBITDA" herein.
"APPLICABLE SPREAD" shall mean the per annum rate to be taken into
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account in determining the per annum rate at which interest will accrue, which
shall be (i) as respects any LIBOR-Based Rate, 2.25% per annum and, if
determining a Prime-Based Rate, .25% per annum, both from the Fourth Amendment
Effective Date through April 30, 1999, and (ii) thereafter, the per annum rate
determined by reference to the Ratio of Total Funded Debt to EBITDA in
accordance with the following table:
Ratio of Total Funded If Determining a If Determining a
Debt to EBITDA LIBOR-Based Rate Prime-Based Rate or a Fed Funds-Based Rate
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4.50 or above 2.25% 0.25%
4.00 to 4.49 2.00% 0.00%
3.50 to 3.99 1.75% 0.00%
3.00 to 3.49 1.50% 0.00%
2.50 to 2.99 1.25% 0.00%
2.00 to 2.49 1.00% 0.00%
less than 2.00 0.75% 0.00%
Interest will accrue and be payable in any fiscal quarter of Parent ending on or
after May 1, 1999, on the basis of the Applicable Spread in effect during the
preceding fiscal quarter of Parent until an adjustment is made as provided
pursuant to the provisions of the definition of "Ratio of Total Funded Debt to
EBITDA" herein.
"DEFAULT RATE OF INTEREST" shall mean a rate of interest per annum equal
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to: (a) with respect to LIBOR Loans, the applicable LIBOR-Based Rate plus 3% per
annum, and (b) with respect to all other Obligations, the Prime-based Rate plus
3% per annum.
"EBIT" shall mean with respect to Parent and its Subsidiaries, on a
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consolidated basis, for any period of determination, Net Income for such period,
plus, without duplication and only to the extent deducted in determining such
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Net Income: (a) (i) the sum of interest expense, income tax expense, and non-
cash FASB 106 and 112 expense for such period, determined in accordance with
GAAP, (ii) restructuring and non-recurring charges not exceeding $34,500,000
incurred in Parent's fiscal year 1997 related to the restructuring of
manufacturing operations to utilize a focus factory manufacturing concept and
the closing of three former General Motors facilities in Anderson, Indiana and
Meridian, Mississippi, (iii) non-cash dividends on the preferred stock of a
Subsidiary (including any deemed dividends in connection with the conversion of
the 8% Preferred Stock of DRA into 8% Debentures), (iv) minority interests in
net income of any corporation, association, limited or general
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partnership, limited liability company or other business entity less than fifty-
percent (50%) of the shares of voting stock or other voting interests of which,
or less than fifty-percent (50%) of the beneficial economic interest of which,
at the time are owned or controlled, directly or indirectly, by any of the
Companies or Parent; (v) the loss and discontinuance charges not exceeding
$1,100,000 in the aggregate incurred in fiscal year 1997 as a result of the
discontinuance of operations of Marine Drive and Marine Corporation, (vi) the
expensing of $2,351,000 of debt issuance costs in fiscal year 1997 related to
the refinancing indebtedness incurred in August, 1996; (vii) the expensing of
$1,833,000 of debt issuance costs in fiscal year 1998 related to the refinancing
indebtedness incurred in December, 1997, (viii) restructuring and non-recurring
charges not exceeding $26,515,000 incurred in Parent's fiscal year 1998 to
increase the employee separation incentives related to the restructuring of
manufacturing operations to utilize a focus factory manufacturing concept and
the closing of three former General Motors facilities in Anderson, Indiana and
Meridian, Mississippi, and (ix) minority interests in net income of WWA and of
Power Investments, but only so long as one or more of the Credit Parties owns in
the aggregate not less than 82% of the outstanding Capital Stock of each such
corporation; and (b) solely for the purposes of determining compliance with the
requirements and covenants set forth in SECTION 8.13 (and not for purposes of
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determining the Applicable Spread, the Applicable Unused Commitment Fee
Percentage or the Applicable LOC Fee Percentage), the sum of $5,000,000, as an
adjustment to reflect a portion of the effects of the GM labor strike during
fiscal year 1998; and minus, without duplication and only to the extent such
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income is included in determining such Net Income and is not actually received
by any of the Credit Parties in cash, minority interests in positive net income
of any corporation, association, limited or general partnership, limited
liability company or other business entity less than fifty-percent (50%) of the
shares of voting stock or other voting interests of which, or less than fifty-
percent (50%) of the beneficial economic interest of which, at the time are
owned or controlled, directly or indirectly, by any of the Companies or of
Parent.
"EXTRAORDINARY COMMITMENT REDUCTION" shall mean a permanent reduction
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of the Line of Credit.
"INDEBTEDNESS" shall mean, as respects any Person as of any date,
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without duplication, (a) obligations of such Person for borrowed money, (b) all
obligations of such Person as lessee under any lease which, in accordance with
GAAP, is or should be capitalized on the books of the lessee (including without
limitation, any Capital Lease), (c) all obligations of such Person for the
deferred purchase price of property, services or assets, other than customary
credit terms extended by sellers of Inventory purchased by such Person in the
ordinary course of its business, (d) all obligations which are secured by any
Lien existing on any asset or property of such Person whether or not the
obligation secured thereby shall have been assumed by such Person, (e) all
contingent reimbursement obligations of such Person in respect of letters of
credit, and (f) all obligations of others similar in character to those
described in clauses (a) through (e) of this definition for which such Person is
liable, contingently or otherwise as obligor, guarantor or in any other
capacity, or in respect of which obligations such Person assures a creditor
against loss or agrees to take any action to prevent any such loss (other than
endorsements of negotiable instruments for collection in the ordinary course of
business), including without limitation all reimbursement obligations of such
Person in respect of letters of credit, surety bonds or similar obligations and
all obligations of such Person to advance funds to, or to purchase assets,
property or services from, any other Person in order to maintain the
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financial condition of such other Person (provided, however, that if the
"Indebtedness" of two or more Persons is being determined on a consolidated
basis, the obligations of such Persons described in clauses (a) through (f) of
this definition shall be without duplication).
"LINE OF CREDIT" shall mean the commitment of the Lenders under SECTION
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3 of this Financing Agreement to make the Revolving Loans to the Companies in
the aggregate maximum principal amount of $300,000,000.00 minus the aggregate
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amount of all Extraordinary Commitment Reductions made on or prior to the date
the aggregate amount of the Lenders' commitment is to be determined.
"LOAN INSTRUMENTS" shall mean the Promissory Notes, the Security
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Agreements, the Subordination Agreements, the Guaranties, the Reimbursement
Agreements, the Letters of Credit, and all other agreements executed by all or
any of the Credit Parties, and any of them in connection with the Original
Financing Agreement or this Financing Agreement, any and all Interest Rate
Agreements respecting the Loans which at any time after the Fourth Amendment
Effective Date may be made between all or any of the Credit Parties and all or
any of the Initial Lenders, and any of the foregoing as the same may be amended,
modified, supplemented or restated from time to time and at any time.
"MATURITY DATE" shall mean October 31, 2003.
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"PERMITTED INDEBTEDNESS" shall mean: (i) accounts payable arising in the
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ordinary course of business, including, without limitation current liabilities
in respect of taxes, assessments and governmental charges or levies, raw
materials, supplies, Equipment, services, taxes or labor and labor-related
costs; (ii) indebtedness of any Company which is subordinated to the prior final
and indefeasible payment and satisfaction in full of such Company's Obligations
by means of subordination agreements in form and substance in all respects
approved by the Agent, with the authorization of the Required Lenders,
including, without limitation, indebtedness evidenced by the GM Subordinated
Note; (iii) indebtedness arising under Letters of Credit and this Financing
Agreement (iv) deferred taxes, FASB 106 and 112 and other expenses accrued by
any Credit Party in the ordinary course of its business; (v) indebtedness under
Capital Leases but only if both before and after giving effect to such Capital
Lease, there shall not be a Default or Event of Default; (vi) the indebtedness
of the A&B Group set forth on Schedule 1.1; (vii) the indebtedness of the Power
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Group set forth on Schedule 1.2; (viii) Indebtedness evidenced by the 1996 Notes
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and the 1997 Notes and the Credit Parties' guaranties thereof; (ix) indebtedness
which is assumed or guaranteed by any Credit Party (or for which any Credit
Party was obligated prior to becoming a Credit Party) in a New Acquisition that
is permitted under SECTION 8.7(K) of this Financing Agreement; and (x) in
addition to those items listed in clauses (i) through (ix) in this definition,
other Indebtedness of the Credit Parties, including Indebtedness secured by
Purchase Money Liens, provided that the Indebtedness for all of the Credit
Parties included within this subsection (x) does not exceed, in the aggregate,
$10,000,000 at any one time.
"POWER GROUP" shall mean, collectively, Power Investments, Franklin,
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International, Marine Drive, Marine Corporation, Powrbilt and Western.
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"SENIOR FUNDED DEBT" shall mean, as of any date of determination, the
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Total Funded Debt, less the Subordinated Debt, and less as of the date of
determination, the amount, if any by which the consolidated cash of the Parent
and its Subsidiaries, determined in accordance with GAAP, exceeds $10,000,000.
"TOTAL FUNDED DEBT" shall mean, with respect to Parent and its
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Subsidiaries, on a consolidated basis; (i) for all purposes herein other than
when used in SECTION 8.13, as of the date of determination, all Indebtedness;
and (ii) when used in (and for purposes of determining compliance with the
covenants in) SECTION 8.13, as of the date of determination, all Indebtedness
less, as of the date of determination, the amount, if any by which the
consolidated cash of the Parent and its Subsidiaries, determined in accordance
with GAAP, exceeds $10,000,000.
(b) New Definitions. Section 1.1 of the Original Agreement is amended
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as of the Fourth Amendment Effective Date by adding thereto, in appropriate
alphabetical position, the following additional definitions:
"1997 NOTES INDENTURE" shall mean Indenture dated as of December 22,
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1997, among Parent, certain of the other Credit Parties and United States Trust
Company of New York, as Trustee, which indenture relates to Parent's 8-5/8%
Senior Notes Due 2007, as such indenture may be amended from time to time.
"1996 NOTES INDENTURE" shall mean Indenture dated as of August 1, 1996,
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among Parent, certain other of the Credit Parties and National City Bank of
Indiana, as Trustee, which indenture relates to Parent's 10-5/8% Senior
Subordinated Notes Due August 1, 2006, as such indenture may be amended from
time to time.
"WESTERN" shall mean Western Reman, Inc., an Indiana corporation.
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"XXXXXXXX" shall mean Xxxxxxxx Technologies, Inc., a South Carolina
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corporation.
"XXXXXXXX ACQUISITION" shall have the meaning ascribed to such term in
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SECTION 8.7(N).
"BASE RATE" shall mean, at any time, the higher of the Prime-Based Rate
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or the Fed Funds-Based Rate. If for any reason the Agent shall have determined
(which determination shall be conclusive absent manifest error) that it is
unable to ascertain the Federal Funds Effective Rate for any reason, including
the inability or failure of the Agent to obtain sufficient quotations in
accordance with the definition of the term "Federal Funds Effective Rate"
herein, the Base Rate shall be the Prime-Based Rate until the circumstances
giving rise to such inability to ascertain the Federal Funds Effective Rate no
longer exist.
"COMMITMENT" shall mean, with respect to each Lender, its commitments to
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make Loans as set forth in SECTIONS 3 and 5 of the Financing Agreement, as such
commitments may be reduced from time to time in accordance with the terms of
this Financing Agreement.
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"FEDERAL FUNDS EFFECTIVE RATE" shall mean, for any day, the weighted
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average of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published on the
next succeeding Business Day by the Federal Reserve Bank of New York, or if such
rate is not so published on the next succeeding Business Day, the average of
the quotations for the day of such transaction received by the Agent from three
federal funds brokers of recognized standing selected by it.
"FED FUNDS-BASED RATE" shall mean a per annum rate of interest equal to
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the sum of the Federal Funds Effective Rate, as in effect from time to time,
plus one-half percent (0.5%) per annum, plus the Applicable Spread.
"FINANCING AGREEMENT" shall mean the Fourth Amended and Restated
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Financing Agreement, dated as of December 16, 1997, among the Credit Parties,
Bank One, CITBC, Dresdner, Toronto Dominion (Texas), Inc., Paribas, and the
Agent, as amended by the First Amendment, the Second Amendment, the Third
Amendment, and the Fourth Amendment and as, from and after the Fourth Amendment
Effective Date, it may be further amended, supplemented, modified and/or
restated from time to time and at any time.
"FIRST AMENDMENT" shall mean the First Amendment to Fourth Amended and
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Restated Financing Agreement, executed September 11, 1998, among the Credit
Parties, Xxxx Xxx, XXXXX, Xxxxxxxx, Xxxxxxx Dominion, Paribas, and the Agent.
"FOURTH AMENDMENT" shall mean the Fourth Amendment to Fourth Amended and
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Restated Financing Agreement dated as of November 13, 1998, among the Companies
(including Western and Xxxxxxxx), the Guarantors, Bank One, CITBC, Dresdner,
KeyBank, Paribas, and the Agent.
"FOURTH AMENDMENT EFFECTIVE DATE" shall mean November 13, 1998.
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"FOURTH AMENDMENT SYNDICATION PERIOD" shall mean the period beginning on
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the Fourth Amendment Effective Date and ending December 31, 1998.
"INITIAL LENDERS" shall mean, collectively, Bank One, CITBC, Dresdner,
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KeyBank and Paribas.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement,
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interest rate cap agreement, interest hedging agreement or other financial
agreement or arrangement designed to protect the Companies against fluctuations
in interest rates.
"KEYBANK" means KeyBank National Association.
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"MAXIMUM PERMITTED AMOUNT" shall mean, as of the date of any
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determination thereof, the lesser of : (a) the Maximum Indebtedness - 1997
Indenture; and (b) the Maximum Indebtedness -1996 Indenture.
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"MAXIMUM INDEBTEDNESS - 1997 INDENTURE" shall mean, as of the date of
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any determination thereof: (a) the Revolving Loan Availability, but only if on
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such date the "Consolidated Coverage Ratio" exceeds 2.00 to 1; and (b) if on
such date the "Consolidated Coverage Ratio" does not exceed 2.00 to 1, the
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highest amount of "Indebtedness" which Parent and its "Restricted Subsidiaries"
may "Incur" pursuant to the provisions of Section 4.03(b)(1) of the 1997 Notes
Indenture (as then in effect) less the aggregate amount of "Indebtedness"
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outstanding as of such date "Incurred" pursuant to any "Permitted Receivables
Financing". (Terms used in this definition which are in quotation marks and
which are defined in the 1997 Notes Indenture shall have the same meanings in
this definition as are ascribed to them in the 1997 Notes Indenture.)
"MAXIMUM INDEBTEDNESS - 1996 INDENTURE" shall mean, as of the date of
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any determination thereof: (a) the Revolving Loan Availability, but only if on
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such date the "Consolidated Coverage Ratio" exceeds 2.25 to 1; and (b) if on
such date the "Consolidated Coverage Ratio" does not exceed 2.25 to 1, the
highest amount of "Indebtedness" which Parent and its "Restricted Subsidiaries"
may "Incur" pursuant to the provisions of Section 4.03(b)(1) of the 1996 Notes
Indenture (as then in effect) less the aggregate amount of "Indebtedness"
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outstanding as of such date "Incurred" pursuant to any "Permitted Receivables
Financing" . (Terms used in this definition which are in quotation marks and
which are defined in the 1996 Notes Indenture shall have the same meanings in
this definition as are ascribed to them in the 1996 Notes Indenture.)
"PRIME-BASED RATE" shall mean a per annum rate of interest equal to the
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sum of the Prime Rate, as in effect from time to time, plus the Applicable
Spread.
"SECOND AMENDMENT" shall mean the Second Amendment to Fourth Amended and
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Restated Financing Agreement, dated as of October 24, 1998, among the
Companies, the Guarantors, Bank One, CITBC, Dresdner, Paribas, Toronto Dominion,
and the Agent.
"THIRD AMENDMENT" shall mean the Third Amendment to Fourth Amended and
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Restated Financing Agreement, dated as of November 13, 1998, among the
Companies, the Guarantors, Bank One, CITBC, Dresdner, KeyBank, Paribas, Toronto
Dominion, and the Agent.
(c) Amendment of Section 3.1. Effective as of the Fourth Amendment
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Effective Date, the second and third sentences of Section 3.1 of the Original
Agreement are amended and restated in their entireties to read as follows:
"The outstanding principal balance of all Revolving Loans in the
aggregate shall not exceed at any time the lowest at such time of (i)
the Line of Credit, (ii) the Revolving Loan Availability, and (iii) the
Maximum Permitted Amount. The outstanding principal balance of all
Revolving Loans made by any Lender shall not exceed at any time such
Lender's Commitment Percentage of the lowest at such time of (i) the
Line of Credit, (ii) the Revolving Loan Availability, and (iii) the
Maximum Permitted Amount. At the time of each request for a Revolving
Loan (or the issuance of a Letter of Credit pursuant to
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Section 5) the Companies shall provide such written certifications and
other confirmations as the Agent may request with respect to the amount
and calculation of the Maximum Permitted Amount as of the last day of
the most current fiscal month to close before such request date."
Section 3.1 is further amended, effective as of the Fourth Amendment
Effective Date, by adding to the end of such Section the following text:
"The aggregate amount of all Revolving Loans requested in connection
with any single Revolving Loan request shall not be less than
$2,000,000."
(d) Amendment of Section 3.3. Effective as of the Fourth Amendment
------------------------
Effective Date, Section 3.3 is amended and restated in its entirety to read as
follows:
"The joint and several obligation of the Companies to repay the
principal amount of the Revolving Loans made pursuant hereto by the
Lenders and to pay interest thereon shall be evidenced in part by
promissory notes executed by the Companies to the Lenders dated as of
the Fourth Amendment Effective Date and substantially in the form of
EXHIBITS II-A THROUGH II-E to the Fourth Amendment (as the same may be
--------------------------
amended, replaced and/or restated from time to time and at any time, the
"Third Amended and Restated Revolving Loan Promissory Notes"). At the
time of the making of any Revolving Loan or payment thereof from and
after the Fourth Amendment Effective Date, as the case may be, each
Lender may, and is hereby authorized to, make a notation on its books or
records with respect to its Third Amended and Restated Revolving Loan
Promissory Note of the date and the amount of its Commitment Percentage
of such Revolving Loan or the amount of any payment thereof. Such books
or records as maintained by the Lenders shall, absent manifest error,
constitute prima facie evidence of the outstanding principal balance of
----- -----
the Revolving Loans. Notwithstanding the foregoing, a Lender's failure
to make a notation on its books or records with respect to any Revolving
Loan shall not limit or otherwise affect the obligation of the Companies
hereunder or under the Third Amended and Restated Revolving Loan
Promissory Notes with respect to any Revolving Loan, nor shall such
failure or error affect any rights of any Lender hereunder or under
applicable law. The unpaid principal balance of each Third Amended and
Restated Revolving Loan Promissory Note as of the Fourth Amendment
Effective Date, prior to the making of any Revolving Loans on that date,
is as stated in the Third Amended and Restated Revolving Loan Promissory
Notes issued to the Initial Lenders concurrently with closing of the
Fourth Amendment."
(e) Amendment of Schedule 7.1(k). Effective as of the Fourth Amendment
----------------------------
Effective Date, Schedule 7.1(k) to the Original Agreement is amended by adding
thereto: "Xxxxxxxx
-11-
Technologies, Inc., a wholly-owned Subsidiary of Reman Holdings, Inc. and
"Western Reman, Inc., a wholly-owned subsidiary of Power Investments, Inc."
(f) Amendment of Section 7.18. Effective as of the Fourth Amendment
-------------------------
Effective Date, Section 7.18 of the Original Agreement is amended and restated
in its entirety to read as follows:
"7.18 Covenants in 1997 Notes Indenture and 1996 Notes Indenture. The
----------------------------------------------------------
Credit Parties at all times will comply with the covenants in
Section 4.03 of the 1997 Notes Indenture and in Section 4.03 of the
1996 Notes Indenture (as each may be amended from time to time) with
respect to the "incurrence" of "Indebtedness" (as those terms are
defined therein) such that no default or event of default is
declared under either the 1997 Notes Indenture or the 1996 Notes
Indenture."
(g) Amendment to Subsection 8.6(b). Effective as of the Fourth
------------------------------
Amendment Effective Date, the text of Subsection 8.6(b) which precedes
subparagraph 8.6(b) (i) is amended and restated in its entirety to read as
follows:
"(b) DRA and Ballantrae may declare and pay dividends to Parent,
and the A&B Group, Nabco, the Power Group, WWA, Kraftube,
Xxxxxxxx or Tractech, as the case may be, may pay dividends to
A&B Holding, Ballantrae, and Reman Holdings which may in turn
pay dividends to Parent or Reman Holdings which may in turn pay
dividends to Parent, in an aggregate amount per fiscal year
equal to"
(h) Amendment to Section 8.7. Effective as of the Fourth Amendment
------------------------
Effective Date, the first line of Section 8.7 of the Original Agreement, which
reads "Make any advance or loan to, or any investment in, any Person, except" is
amended to read as follows:
"Make a New Acquisition or make any advance or loan to, or any
investment in, any Person, except"
Effective as of the Fourth Amendment Effective Date, Section 8.7 of the
Original Agreement is further amended by adding thereto a new subsection (n)
reading as follows:
"(n) the acquisition of all of the issued and outstanding capital
stock of Xxxxxxxx pursuant to that certain Stock Purchase and
Sale Agreement, dated as of November 13, 1998, by and among
Parent, Reman Holdings, The X.X. Xxxxxxxx Company (the "XXXXXXXX
ACQUISITION"), and Xxxxxxxx, and the intercompany loans made by
Parent to Reman Holdings to finance the such acquisition."
-12-
Effective as of the Fourth Amendment Effective Date, Section 8.7(d) of
the Original Agreement is amended and restated in its entirety to read as
follows:
"(d) New Acquisitions of, investments in, loans to or guaranties
of any Indebtedness of any foreign corporation, partnership, joint
venture, or other Person, or REI or any United States Subsidiaries
investing, directly or indirectly, in any of the foregoing, provided
that
(i) no Default or Event of Default has occurred and is continuing
at the time such investment, loan, or guaranty is to be made,
(ii) such investments, loans, and guaranties shall not exceed
$100,000,000 in the aggregate for all Credit Parties at any time and from
time to time,
(iii) the Companies shall have provided to the Agent copies
of any materials submitted to their boards of directors with respect to any
such investment, loan or guaranty; and
(iv) if a New Acquisition, such New Acquisition does not and will
not result in a Default or Event of Default, including, without limitation,
an Event of Default under Section 8.13, determined after giving effect to
the New Acquisition on a pro forma basis in accordance with Section
--- -----
8.13(f)."
(i) Amendment of Section 8.13. Effective as of the Fourth Amendment
-------------------------
Effective Date, Section 8.13 of the Original Agreement is amended and restated
to read in its entirety as follows:
"(a) As of the close of each fiscal quarter of Parent, Parent and
its Subsidiaries, on a consolidated basis, for the period of the
four consecutive fiscal quarters which end on such close, shall
have a Ratio of Total Funded Debt to EBITDA of not greater than
5.00:1 from the Fourth Amendment Effective Date through October
30, 1999, and of not greater than the amounts set forth below
from the date set forth below until the next date set forth
below:
From: the following ratio:
---- -------------------
October 31, 1999 4.50:1
October 31, 2000 4.25:1
October 31, 2001
and at all times thereafter 4.00:1"
"(b) As of the close of each fiscal quarter of Parent, Parent and
its Subsidiaries, on a consolidated basis, for the period of the four
-13-
consecutive fiscal quarters which end on such close, shall have a ratio of
Senior Funded Debt to EBITDA of not greater than (i) 3.75:1 from the Fourth
Amendment Effective Date through October 30, 1999, (ii) 3.25:1 during the
period beginning October 31, 1999 through October 30, 2000, (iii) 3.00
during the period beginning October 31, 2000 through October 30, 2001, and
(iv) 2.75:1 beginning October 31, 2001 and at all times thereafter.
"(c) As of the close of each fiscal quarter of Parent, Parent and
its Subsidiaries, on a consolidated basis, for the period of the four
consecutive fiscal quarters which end on such close, shall have a ratio
of EBIT to cash payments of interest of not less 1.5:1.
"(d) As of the close of each fiscal quarter of Parent, Parent and
its Subsidiaries, on a consolidated basis, for the period of the four
consecutive fiscal quarters which end on such close, shall have a Fixed
Charge Coverage Ratio of not less than 1.15:1.
"(e) Parent and its Subsidiaries, on a consolidated basis, shall
maintain at all times a ratio of Current Assets to Current Liabilities
of not less than 1.5:1.
"(f) For purposes of making the pro forma calculations necessary
to determine the effect of a proposed New Acquisition on compliance with the
covenants in clauses (a) and (b) of this SECTION 8.13, (i) EBIT and EBITDA
shall be deemed to include the net income of the Person or business proposed
to be acquired plus, without duplication and to the extent deducted in
determining such net income, the sum of interest expense, income tax
expense, non-cash FASB 106 and 112 expense, and (with respect to EBITDA)
depreciation and amortization expense (all determined in accordance with
GAAP and based on audited financial statements or other financial statements
of such Person acceptable to the Required Lenders) during the period of four
fiscal quarters of Parent immediately preceding the date as of which EBIT
and EBITDA are to be determined, and (ii) all other amounts necessary to
make such calculations shall be determined in accordance with GAAP based on
audited financial statements or other financial statements of such Person
acceptable to the Required Lenders.
"For all purposes of this Financing Agreement, other than making the
calculations necessary to determine compliance with the covenants in
clauses (c) and (d) of this SECTION 8.13: (i) EBIT and EBITDA for
periods that include periods preceding the acquisition of WWA shall be
deemed to include the net income without duplication of WWA plus,
without duplication and to the extent deducted in determining such net
-14-
income, the sum of interest expense, income tax expense, non-cash FASB
106 and 112 expense, and (with respect to EBITDA) depreciation and
amortization expense (all determined in accordance with GAAP and based
on audited financial statements or other financial statements acceptable
to the Required Lenders) during any portion of the period of four fiscal
quarters of Parent immediately preceding the date as of which EBIT or
EBITDA is to be determined that preceded the acquisition of WWA; (ii)
EBIT and EBITDA for periods that include periods preceding the
acquisition of Ballantrae shall be deemed to include the consolidated
net income without duplication of Ballantrae and its Subsidiaries plus,
without duplication and only to the extent deducted in determining such
consolidated net income, the sum of interest expense, income tax
expense, non-cash FASB 106 and 112 expense, and (with respect to EBITDA)
depreciation and amortization expense (all determined in accordance with
GAAP and based on audited financial statements or other financial
statements acceptable to the Required Lenders) during any portion of the
period of four fiscal quarters of Parent immediately preceding the date
as of which EBIT or EBITDA is to be determined that preceded the
acquisition of Ballantrae; (iii) for the first 12 months following a
New Acquisition that is permitted under the terms of this Financing
Agreement, EBIT and EBITDA shall be deemed to include the net income of
the Person or business acquired plus, without duplication and to the
extent deducted in determining such net income, the sum of interest
expense, income tax expense, non-cash FASB 106 and 112 expense, and
(with respect to EBITDA) depreciation and amortization expense (all
determined in accordance with GAAP and based on audited financial
statements or other financial statements acceptable to the Required
Lenders) during the period of four fiscal quarters of Parent immediately
preceding the date as of which EBIT or EBITDA is to be determined; and
(iv) for the first 12 months following the Xxxxxxxx Acquisition, EBIT
and EBITDA shall be deemed to include the consolidated net income of the
Xxxxxxxx, plus, without duplication and to the extent deducted in
determining such net income, the sum of interest expense, income tax
expense, non-cash FASB 106 and 112 expense, and (with respect to EBITDA)
depreciation and amortization expense (all determined in accordance with
GAAP and based on audited consolidated financial statements or other
financial statements for the Xxxxxxxx acceptable to the Required
Lenders) during the period of four fiscal quarters of Parent immediately
preceding the date as of which EBIT or EBITDA is to be determined."
(j) Amendment of Section 7.1. Effective as of the Fourth Amendment
------------------------
Effective Date, Section 7.1 of the Original Agreement is amended by adding
thereto a new subsection (o), reading in its entirety as follows:
"(o) Year 2000 Compliant.
-------------------
(i) All devices, systems, machinery, information technology, computer
software and hardware, and other date sensitive technology (jointly and
severally the "Systems") necessary for each of the Companies and the
Guarantors to carry on its business as presently conducted and as
-15-
contemplated to be conducted in the future are Year 2000 Compliant or will
be Year 2000 Compliant within a period of time calculated to result in no
material disruption of any of its business operations. For purposes of
these provisions, "Year 2000 Compliant" means that such Systems are designed
to be used prior to, during and after the Gregorian calendar year 2000 A.D.
and will operate during each time period without error relating to date
data, specifically including any error relating to, or the product of, date
data which represents or references different centuries or more than one
century.
(ii) Each Company and Guarantor has: (1) undertaken a detailed
inventory, review, and assessment of all areas within its business and
operations that could be adversely affected by the failure of such Company
and Guarantor to be Year 2000 Compliant on a timely basis; (2) developed a
detailed plan and time line for becoming Year 2000 Compliant on a timely
basis, and (3) to date, implemented that plan in accordance with that
timetable in all material respects.
(iii) Each Company and Guarantor has made written inquiry of each of its
key suppliers, vendors, and customers, and has obtained in writing
confirmations from all such Persons, as to whether such persons have
initiated programs to become Year 2000 Compliant and on the basis of such
confirmations, such Company and Guarantor reasonably believes that all such
persons will be or become so compliant. For purposes hereof, "key
suppliers, vendors, and customers" refers to those suppliers, vendors, and
customers of such Company and Guarantor whose business failure would, with
reasonable probability, result in a Material Adverse Effect.
(iv) The fair market value of all real and personal property, if any,
pledged to the Agent as collateral pursuant to the Loan Instruments to
secure the Obligations is not and shall not be less than currently
anticipated or subject to substantial deterioration in value because of the
failure of such collateral to be Year 2000 Compliant."
(k) Amendment of Section 7 - Adding New Section 7.19. Effective as of
------------------------------------------------
the Fourth Amendment Effective Date, Section 7 of the Original Agreement is
amended by adding to the end thereof a new Section 7.19, which shall read in its
entirety as follows:
"7.19 YEAR 2000 COMPLIANCE. Each Company and Guarantor will:
--------------------
(1) Furnish such additional information, statements and other reports
with respect to its activities and progress towards becoming Year 2000
Compliant as any Lender may reasonably request from time to time.
-16-
(2) In the event of any change in circumstances that causes or will
likely cause any of its representations and warranties with respect to
its being or becoming Year 2000 Compliant to no longer be true
(hereinafter, referred to as a "Change in Circumstances") then it
promptly, and in any event within ten (10) days of receipt of
information regarding a Change in Circumstances, provide the Agent with
written notice (the "Notice") that describes in reasonable detail the
Change in Circumstances and how such Change in Circumstances caused or
will likely cause such Company's or Guarantor's representations and
warranties with respect to being or becoming Year 2000 Compliant to no
longer be true. Such Company or Guarantor shall, within ten (10) days
of a request, also provide the Agent with any additional information any
Lender requests of such Company or Guarantor in connection with the
Notice and/or a Change in Circumstances.
(3) Give any representative of any Lender access during all business
hours to, and permit such representative to examine, copy or make
excerpts from, any and all books, records and documents in the
possession of such Company or Guarantor and relating to its affairs, and
to inspect any of the properties and Systems of such Company or
Guarantor and to project test the Systems to determine if they are Year
2000 Compliant in an integrated environment, all at the sole cost and
expense of that Lender."
(l) Amendment of Section 13.5. Effective as of the Fourth Amendment
-------------------------
Effective Date, the first paragraph of Section 13.5 of the Original Agreement is
amended and restated in its entirety to read as follows:
"THE COMPANIES, THE GUARANTORS, THE AGENT, AND THE LENDERS HEREBY
VOLUNTARILY, KNOWINGLY, ABSOLUTELY IRREVOCABLY AND UNCONDITIONALLY
WAIVE ANY RIGHT TO HAVE A JURY TRIAL OR HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE (WHETHER BASED UPON CONTRACT, TORT OR
OTHERWISE) BETWEEN OR AMONG THE COMPANIES, THE GUARANTORS, THE AGENT
AND THE LENDERS, OR ANY OF THEM, ARISING OUT OF OR IN ANY WAY
RELATED TO THE FINANCING AGREEMENT OR ANY OTHER LOAN INSTRUMENT, OR
ANY RELATIONSHIP BETWEEN ALL OR ANY OF THE COMPANIES, THE GUARANTORS
AND ALL OR ANY OF THE LENDERS OR THE AGENT. THIS PROVISION IS A
MATERIAL
-17-
INDUCEMENT TO THE LENDERS TO PROVIDE THE FINANCING DESCRIBED HEREIN
OR IN THE OTHER LOAN INSTRUMENTS.
THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS FINANCING
AGREEMENT AND THE OTHER LOAN INSTRUMENTS (EXCEPT AS OTHERWISE EXPRESSLY
PROVIDED THEREIN) SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
INDIANA WITHOUT REGARD TO ITS CHOICE OR CONFLICTS OF LAWS PROVISIONS. THE
COMPANIES AND THE GUARANTORS AGREE THAT THE COURTS OF THE STATE OF INDIANA
LOCATED IN XXXXXX COUNTY, INDIANA AND THE FEDERAL COURTS LOCATED IN THE
SOUTHERN DISTRICT OF INDIANA, INDIANAPOLIS DIVISION, HAVE EXCLUSIVE
JURISDICTION OVER ANY AND ALL ACTIONS AND PROCEED INGS INVOLVING THIS
FINANCING AGREEMENT OR ANY OTHER LOAN INSTRUMENT AND THE COMPANIES AND THE
GUARANTORS HEREBY IRREVOCABLY AND UNCONDI TIONALLY AGREE TO SUBMIT TO THE
JURISDICTION OF SUCH COURTS FOR PURPOSES OF ANY SUCH ACTION OR PROCEEDING.
THE COMPANIES AND THE GUARANTORS HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVE ANY OBJECTION THAT THEY MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY
SUCH ACTION OR PROCEEDING, INCLUDING ANY CLAIM THAT SUCH COURT IS AN
INCONVENIENT FORUM, WAIVE PERSONAL SERVICE OF PROCESS AND CONSENT TO SERVICE
OF PROCESS PROVIDED THE SAME IS IN ACCORDANCE WITH THE TERMS HEREOF. FINAL
JUDGMENT IN ANY SUCH PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDIC TIONS BY SUIT ON THE JUDGMENT. THE COMPANIES AND THE
GUARANTORS HEREBY ALSO ABSOLUTELY, IRREVOCABLY AND UNCONDITIONALLY WAIVE THE
RIGHT TO INTERPOSE ANY DEFENSE BASED ON STATUTE OF LIMITATIONS OR ANY CLAIM
OF LACHES."
(m) Amendment to Section 12. Effective as of the Fourth Amendment
-----------------------
Effective Date, the fourth sentence of Section 12 of the Original Agreement is
amended and restated in its entirety to read as follows:
"The Companies also may terminate the Line of Credit in part from
time to time upon seven (7) days prior written notice to the Agent,
so long as such termination is at least $5,000,000; and for purposes
hereof, each such termination shall constitute an Extraordinary
Commitment Reduction."
-18-
(n) Amendment to Section 9.1. Effective as of the Fourth Amendment
------------------------
Effective Date, the first paragraph of Section 9.1 of the Original Agreement is
amended and restated in its entirety to read as follows:
"Interest on the Loans is a joint and several obligation of each of
the Companies and (except as otherwise provided in this Financing
Agreement) shall be at a rate equal to: (a) the Base Rate on the
outstanding balances of the Loans (other than LIBOR Loans) from time
to time, or (b) the applicable LIBOR-Based Rate on the outstanding
balances of the LIBOR Loans from time to time. Interest on the
Loans shall be payable monthly, in arrears, on each Interest Due
Date. The Companies may elect to use the LIBOR-Based Rate as to any
Loans provided (a) there is then no Event of Default, (b) the
Companies have notified the Agent and the Lenders of the election to
use the LIBOR-Based Rate and of the LIBOR Period selected and such
notice is given no later than third (3rd) Business Day preceding the
first day of a LIBOR Period. Such election and the LIBOR-Based Rate
shall be effective, provided there is then no Event of Default and
the notification required under the preceding sentence has been
given, on the first day of the LIBOR Period. The election of a
LIBOR-Based Rate must be for a Loan in excess of $1,000,000 or
integral multiples of $100,000 in excess thereof. If no such
election to use a LIBOR-Based Rate as to a given Loan is timely made
or can be made, the Agent has suspended quotations of LIBOR-Based
Rates, or the LIBOR-Based Rate cannot be determined with respect to
such Loan, interest shall accrue and be payable on such Loan at the
Base Rate. The Loans shall bear interest on the unpaid principal
balance thereof. Interest shall be calculated on the basis of a
360-day year and actual days elapsed. The Agent shall be entitled
to charge the Companies' accounts for interest at the rate(s)
provided herein when due until all Obligations have been paid in
full."
(o) Correction of Typographical Error. Effective as of the execution
---------------------------------
date of the Original Agreement, the phrase "whether not owned or existing" in
Section 6.1 of the Original Agreement is corrected to read "whether now owned or
existing."
(p) Amendment of Section 14.9. Effective as of the Fourth Amendment
-------------------------
Effective Date, Section 14.9 of the Original Agreement is amended and restated
in its entirety to read as follows:
"(a) A Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time assign to one or
more commercial banks, commercial finance lenders or other
financial institutions (a "Purchaser") all or any part of its
Loans, Commitment and its rights and obligations under its
Promissory Note(s) and under this Financing Agreement, pursuant
to a form of assignment acceptable to such Lender and such
Purchaser, provided that (i) the Lender shall have given the
--------------
-19-
Agent not fewer than seven (7) Banking Days prior written notice
of such assignment, (ii) each individual assignment shall be in
an amount of not less than $10,000,000, (iii) the prior written
consent of the Agent shall be required prior to an assignment
becoming effective with respect to a Purchaser which is not then
a Lender or an Affiliate thereof, which consent shall not be
unreasonably withheld, and (iv) the Purchaser (excluding any
Purchaser that becomes such prior to the expiration of the
Fourth Amendment Syndication Period) shall have paid an
assignment fee to the Agent, for its account, in the amount of
$2,500. Notwithstanding the foregoing provisions in this Section
14.9, any Lender may at any time assign all or any portion of
its Loans and Promissory Note to a Federal Reserve Bank (but no
such assignment shall release any Lender from any of its
obligations hereunder).
(b) Upon delivery to the Agent of a notice of assignment, together
with any consent required by this Section 14.9, such assignment
shall become effective on the effective date specified in such
notice. On and after the effective date of such assignment,
such Purchaser shall for all purposes be a Lender party to this
Financing Agreement and shall have all the rights and
obligations of a Lender under this Financing Agreement, to the
same extent as if it were an original party hereto, Exhibit A
to this Financing Agreement shall be automatically amended to
reflect the Commitment Percentages of the Persons who are
Lenders, and no further consent or action by the Companies, or
the Guarantors, the Agent or any other Lender shall be required
to release the transferor Lender with respect to the percentage
of the Loans and Commitment assigned to such Purchaser. Upon
the consummation of any assignment to a Purchaser pursuant to
this Section 14.9, the transferor Lender and the Companies
shall make appropriate arrangements so that a replacement
Promissory Note is issued to such transferor Lender and a new
Promissory Note or, as appropriate, a replacement Promissory
Note is issued to such Purchaser, in each case in principal
amounts reflecting its Commitment Percentage of the Line of
Credit. Each of the Companies, or the Guarantors shall, if
necessary or deemed appropriate by the Agent, execute such new
Promissory Notes, amendments to this Financing Agreement and
other documents reasonably required to effectuate such
assignments."
(q) Amendment of Section 8.5. Effective as of the Fourth Amendment
------------------------
Effective Date, Section 8.5 of the Original Agreement is amended and
restated in its entirety to read as follows:
"8.5 Assume, guarantee, endorse, or otherwise become liable for
the obligations of any Person, except (a) by the endorsement of
negotiable
-20-
instruments for deposit or collection or similar transactions in the
ordinary course of business, (b) guarantees by any Credit Party of
Permitted Indebtedness of any other Credit Party or any of its
subsidiaries (provided that no Credit Party may guarantee any Permitted
Indebtedness of REI or any of its Subsidiaries except as permitted by
SECTION 8.7), (c) the guaranty by Parent of $1,500,000 in obligations of
Ballantrae and Tractech to Dyneer Corporation under an agreement entered
into on or about the Effective Date, (d) the guaranty by Power
Investments, Inc. of the payment and performance of (i) the obligations
of Marine Corporation to Mercury Marine, a Division of Brunswick
Corporation, under an Asset Purchase Agreement among such Persons (a
copy of which was provided to the Agent), and (ii) the obligations of
Power Investments Marine, Inc. to International Marine Systems under the
Asset Purchase Agreement dated as of June 17, 1998, among such Persons;
and (e) as otherwise expressly permitted in this Financing Agreement;"
(r) Replacement of Exhibit A. Effective as of the Fourth Amendment
------------------------
Effective Date, Exhibit A to the Original Agreement is replaced with Exhibit
A to this Fourth Amendment.
(s) Amendment of Section 8.12. Effective as of the Fourth Amendment
-------------------------
Effective Date, Section 8.12 of the Original Agreement is amended and
restated in its entirety to read as follows:
"8.12 Parent and its Subsidiaries, on a consolidated basis,
will not enter into any Operating Lease if after giving effect
thereto the aggregate obligations with respect to Operating
Leases of Parent and its Subsidiaries, on a consolidated basis,
during any fiscal year would exceed $12,500,000 (excluding
Operating Leases of REI and its Subsidiaries which are not
guaranteed by any Credit Party);"
5. Conditions Precedent. The agreements and obligations of the Lenders
--------------------
under this Fourth Amendment are subject to the receipt by the Agent, for the
benefit of the Lenders, of the following documents and payments concurrently
with the execution of this Fourth Amendment (unless otherwise provided):
(a) (1) Third Amended and Restated Revolving Loan Promissory Notes,
dated as of the Fourth Amendment Effective Date, duly executed and delivered
by the Companies, Western and Xxxxxxxx to each of the Initial Lenders in the
aggregate principal sum of $300,000,000.00, each in form and substance the
same as attached hereto as EXHIBIT II - A through II-E. (These Third
-------------- ----
Amended and Restated Revolving Loan Promissory Notes amend, and as so
amended restate, the Second Amended and Restated Revolving Loan
-21-
Promissory Notes issued and delivered pursuant to Section 3.3 of the
Original Agreement.) (2) A Security Agreement (Patents, Trademarks,
Copyrights and Licenses), dated as of the Fourth Amendment Effective
Date, executed by Xxxxxxxx in favor of the Agent for the benefit of
the Lenders, in form and substance the same as the IP Security
Agreement (but with Xxxxxxxx as the grantor and with Exhibits A
through C thereto containing the information set forth on Exhibits
I-A through I-C to this Fourth Amendment).
(b) (1) Amendment to Pledge Agreement, dated as of the Fourth Amendment
Effective Date, duly executed and delivered by Reman Holdings, Inc.
in favor of the Agent, for the benefit of the Lenders, in form and
substance the same as attached hereto as EXHIBIT II-A.
------------
(2) Amendment to Pledge Agreement, dated as of the Fourth Amendment
Effective Date, duly executed by Power Investments in favor of the
Agent for the benefit of the Lenders, in form and substance the same
as attached hereto as EXHIBIT II-B.
------------
(3) A Security Agreement (patents, trademarks, copyrights and
licenses) dated as of the Fourth Amendment Effective Date executed
by Western in favor of the Agent for the benefit of the Lenders, in
form and substance the same as the IP Security Agreement (but with
Western as the grantor).
(c) Copies of the resolutions adopted by the Boards of Directors (and
where required, the shareholders) of (i) Xxxxxxxx authorizing the
execution, delivery, and performance of the Fourth Amended and
Restated Revolving Loan Promissory Notes, this Fourth Amendment and
the other Loan Instruments to be executed in connection herewith and
therewith, certified by its corporate Secretaries or Assistant
Secretaries as accurate, complete and in full force and effect,
together with certificates signed by the Secretaries or Assistant
Secretaries and another executive officer of Xxxxxxxx and of Western
certifying the incumbency, authority, name and true signature of
their respective officer(s) authorized to signed such Loan
Instruments for and on their behalf, and (ii) the other Companies
and Guarantors authorizing the execution, delivery, and performance
of the Fourth Amended and Restated Revolving Loan Promissory Notes,
this Fourth Amendment and the other Loan Instruments to be executed
in connection herewith and therewith, certified by their respective
corporate Secretaries or Assistant Secretaries as accurate,
complete, and in full force in effect, together with certificates
signed by the Secretary or Assistant Secretary and another executive
officer of each such Company and Guarantor certifying the
incumbency, authority, name and true signature of its officer(s)
authorized to such Loan Instruments for and on its behalf.
-22-
(d) Certificates of Good Standing for Xxxxxxxx and Western, together
with the Articles of Incorporation and By-Laws of Xxxxxxxx and
Western, (together with certified copies of any amendment to the
Articles of Incorporation to be filed after the Fourth Amendment
Effective Date changing Xxxxxxxx'x legal name), all certified by the
Secretary or Assistant Secretary of Xxxxxxxx or Western, as
applicable.
(e) (i) Opinions of counsel for the Companies and the Guarantors that
this Fourth Amendment and all of the other the Loan Instruments
executed by each Company and Guarantor in connection herewith has
been duly authorized and validly executed, and (ii) with respect to
Xxxxxxxx only, an opinion of counsel for Xxxxxxxx substantially in
the form attached to this Fourth Amendment as EXHIBIT IV, (iii) with
----------
respect to Western, such opinions of counsel for Western as the
Agent may request, and (iv) such other opinions of counsel for the
Companies and the Guarantors as the Agent reasonably may request.
(f) Evidence reasonably satisfactory to the Lenders and the Agent that
the security interests granted to the Agent by Xxxxxxxx and by
Western are first and prior security interests, subject only to
Permitted Encumbrances.
(g) (i) An executed and complete copy of the Xxxxxxxx Acquisition
agreements (including all schedules and exhibits thereto) and all
closing documents related thereto; and (ii) evidence satisfactory to
the Initial Lenders that the Xxxxxxxx Acquisition has been
consummated, subject only to payment of purchase consideration to
X.X. Xxxxxxxx Company..
(h) As provided in the Original Agreement, (i) all expenses of the
Lenders and the Agent, including reasonable attorneys' fees,
incurred in connection with this Fourth Amendment, shall be paid by
the Credit Parties and Xxxxxxxx; and (ii) all outstanding, unpaid
previously billed fees incurred by the Agent for the services of
Xxxxx & Xxxxxxx shall be paid in full.
(i) Payment to the Agent, for the prorata benefit of the Lenders who are
signatories to this Fourth Amendment (the "Initial Lenders"), of the
fee established pursuant to letter agreement, dated as of the Fourth
Amendment Effective Date, between DRA, Parent and the Initial
Lenders.
(j) Payment to Banc One Capital Markets ("BOCM") of unpaid fees due it
under the letter agreement, dated as of the Fourth Amendment
Effective Date, between BOCM and DRA.
(k) Such other documents and materials as the Agent reasonably may
request.
-23-
(l) Payment to the Agent of the Agent Fee applicable to the increased
amount of the Line of Credit created by the Fourth Amendment for the
period from the Fourth Amendment Effective Date through the first
anniversary of the Closing Date.
6. Amendment of Other Loan Instruments. All references to the
-----------------------------------
Original Agreement in the other Loan Instruments shall mean the Original
Agreement, as modified and amended by this Fourth Amendment and as it may be
further amended, modified, extended, renewed, supplemented and/or restated from
time to time and at any time. The other Loan Instruments are hereby modified
and amended to the extent necessary to conform them to, or to cause them to
accurately reflect, the terms of the Original Agreement, as modified by this
Fourth Amendment. Except as otherwise expressly provided herein, all of the
terms and provisions of the Original Agreement and the other Loan Instruments,
as modified and amended by this Fourth Amendment, remain in full force and
effect, and fully binding on the parties thereto and their respective successors
and assigns.
7. Consent and Affirmation of Guarantors. Each of the Guarantors expressly
-------------------------------------
consents to the execution, delivery, and performance by the Companies, including
Xxxxxxxx and Western, each of the other Guarantors, Bank One, CITBC, Dresdner,
KeyBank, Paribas, and the Agent of this Fourth Amendment and to the amendments
of the Original Agreement and the other Loan Instruments provided herein. Each
of the Companies expressly consents to the execution, delivery and performance
by each of the other Companies of this Fourth Amendment and to the amendments of
the Original Agreement and the other Loan Instruments as provided herein. Each
of the Guarantors, jointly and severally, agrees that neither the provisions of
this Fourth Amendment nor any actions taken or not taken in accordance with the
terms of this Fourth Amendment shall constitute a termination, extinguishment,
release or discharge of their Guaranties, or any of their respective obligations
thereunder, now existing or hereafter arising, or provide a defense, set-off, or
counterclaim to any of them with respect to any of their obligations thereunder,
now existing or hereafter arising. Each of the Guarantors hereby affirms that
the term "Obligations" (as such term is defined in the Restated Guaranty, dated
December 16, 1997, executed and delivered by the Guarantors to the Agent for the
benefit of the Lenders) includes all of the indebtedness, obligations and
liabilities evidenced by or arising under or pursuant to the Third Amended and
Restated Revolving Loan Promissory Notes executed and delivered pursuant to this
Fourth Amendment, as the same may hereafter be amended, replaced and/or restated
from time to time and at any time.
8. Binding on Successors and Assigns. All the terms and provisions of this
---------------------------------
Fourth Amendment shall be binding upon and inure to the benefit of the parties
hereto, their respective successors, assigns and legal representatives.
Whenever in this Fourth Amendment any of the parties hereto is referred to, such
reference shall be deemed to include the successors and assigns of such party.
9. Further Assurances. Each of the Companies (including Xxxxxxxx and
------------------
Western), the Guarantors, Bank One, CITBC, Dresdner, Paribas, and KeyBank, as
the case may be, shall duly execute and deliver, or cause to be executed and
delivered, such further instruments and perform or
-24-
cause to be performed such further acts as may be necessary or proper in the
reasonable opinion of the Agent to carry out the provisions and purposes of this
Fourth Amendment.
10. Governing Law. This Fourth Amendment shall be governed by, and
-------------
construed in accordance with, the laws of the State of Indiana, without regard
to its principles of conflicts or choice of law rules.
11. Survival. All covenants, agreements, undertakings, representations, and
--------
warranties made in this Fourth Amendment shall survive the execution and
delivery of this Fourth Amendment, and shall not be affected by any
investigation made by any party.
12. Entire Agreement. This Fourth Amendment constitutes and expresses the
----------------
entire understanding between the parties hereto with respect to the subject
matter hereof, and supersedes all prior agreements and understandings,
commitments, inducements or conditions with respect thereto, whether express or
implied, oral or written.
13. Counterparts. This Fourth Amendment may be executed in two or more
------------
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute but one agreement. In the event any party
executes and delivers this Fourth Amendment via facsimile, such party hereby
agrees that for the purposes of enforcement and all applicable statutes, laws
and rules, including, without limitation, the Uniform Commercial Code, rules of
evidence and statutes of fraud: (i) the facsimile signature of such party shall
constitute a binding signature of such party as a symbol and xxxx executed and
adopted by such party with a present intention to authenticate this Fourth
Amendment; (ii) the facsimile of this Fourth Amendment shall constitute a
writing signed by such party; and (iii) the facsimile of this Fourth Amendment
shall constitute an original of and best evidence of this Fourth Amendment.
-25-
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY BLANK]
-26-
IN WITNESS WHEREOF, the parties hereto have caused this Fourth Amendment
to Fourth Amended and Restated Financing Agreement to be executed and delivered
by their duly authorized officers as of the date set forth above.
BANK ONE, INDIANA, NATIONAL ASSOCIATION, INDIVIDUALLY
AND AS AGENT
By: /s/ Xxxxxx. X. Xxxxxxxx
-------------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President and Senior
Relationship Manager
THE CIT GROUP/BUSINESS CREDIT, INC.
By: /s/ Xxxxx Xxxxxxxxx
--------------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Vice President
DRESDNER BANK AG, NEW YORK AND GRAND
CAYMAN BRANCHES
By: /s/ Xxxx X. Xxxxxxx
----------------------------------------------
Name: Xxxx X. Xxxxxxx
Title: Assistant Vice President
By: /s/ Brigitte Sacin
---------------------------------------------
Name: Brigitte Sacin
Title: Assistant Treasurer
KEYBANK NATIONAL ASSOCIATION
By: /s/ K. Xxxxxxxxx Xxxxx
--------------------------------------
Name: K. Xxxxxxxxx Xxxxx
Title: Vice President
PARIBAS
By: ___________________________
Name:
Title:
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
-27-
[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
DELCO REMY AMERICA, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President
and Chief Financial Officer
NABCO, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
A&B ENTERPRISES, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
DALEX, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
A&B CORES, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
R & L TOOL COMPANY, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
-28-
[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
MCA, INC. OF MISSISSIPPI
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
FRANKLIN POWER PRODUCTS, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
INTERNATIONAL FUEL SYSTEMS, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
POWER INVESTMENTS MARINE, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
MARINE CORPORATION OF AMERICA
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
POWRBILT PRODUCTS, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
WORLD WIDE AUTOMOTIVE, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
-29-
[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
TRACTECH, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
KRAFTUBE, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
XXXXXXXX TECHNOLOGIES, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
WESTERN REMAN, INC.
By:/s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
DELCO REMY INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
REMAN HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
-30-
[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
THE A&B GROUP, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
POWER INVESTMENTS, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
REMY INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President, Chief
Financial Officer and Treasurer
BALLANTRAE CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Treasurer
-31-
STATE OF INDIANA )
) SS:
COUNTY OF XXXXXX )
Before me a Notary Public in and for the State of Indiana and County of
Xxxxxx personally appeared Xxxxx X. Xxxxxxx, the VP & Treas. of Xxxxxxxx
Technologies, Inc., a South Carolina corporation, who acknowledged execution of
the foregoing Fourth Amendment to Fourth Amended and Restated Financing
Agreement for an on behalf of such corporation as its duly authorized officer.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 13/th/ day
of November, 1998.
/s/ Xxxxxxx X. Xxxx
-------------------
Printed:Xxxxxxx X. Xxxx, Notary Public
My commission expires:5-11-99
Residing in Xxxxxxxxx County, Indiana
STATE OF INDIANA )
) SS:
COUNTY OF XXXXXX )
Before me a Notary Public in and for the State of Indiana and County of
_______________________ personally appeared Xxxxx X. Xxxxxxx, the VP & Treas. of
Western Reman, Inc., an Indiana corporation, who acknowledged execution of the
foregoing Fourth Amendment to Fourth Amended and Restated Financing Agreement
for an on behalf of such corporation as its duly authorized officer.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 13/th/ day
of November, 1998.
/s/ Xxxxxxx X. Xxxx
-------------------
Printed:Xxxxxxx X. Xxxx, Notary Public
My commission expires:5-11-99
Residing in Xxxxxxxxx County, Indiana
-32-
EXHIBIT A
---------
(COMMITMENT PERCENTAGES)
Commitment Commitment
Lender Amount Percentage
------------------------ ------------ -----------
Bank One, Indiana,
National Association $122,000,000 40.67%
The CIT Group/Business
Credit, Inc. $ 58,000,000 19.33%
Dresdner Bank AG,
New York and
Grand Cayman Branches $ 60,000,000 20.00%
KeyBank
National Association $ 40,000,000 13.33%
Paribas $ 20,000,000 6.67%
-33-
SCHEDULE I-A
------------
Exhibit A
---------
(Patents and Patent Applications of Xxxxxxxx Technologies, Inc..)
Owner Description (Including Number)
----- ------------------------------
None
-34-
SCHEDULE I-B
------------
Exhibit B
---------
(Copyrights of Xxxxxxxx Technologies, Inc..)
Owner Description
----- -----------
None
-35-
SCHEDULE I-C
------------
Exhibit C
---------
(Trademarks, Trademark Registrations
and Applications and Trademarks of Xxxxxxxx Technologies, Inc..)
Description and Governmental
Owner Authority Registering
----- ------------------------------
Xxxxxxxx Technologies, Inc. (by assignment PRONET, U.S. Registered Trademark:
from The X.X. Xxxxxxxx Company). Registration number 1,983,380; Registration date July 2, 1996.
-36-
SCHEDULES II-A THROUGH II-E
---------------------------
(Third Amended and Restated Revolving
Loan Promissory Notes)
-37-
