EXHIBIT 4.2
AMENDMENT NO. 1 TO
AMENDED AND RESTATED SECOND LIEN CREDIT AGREEMENT
Amendment No. 1 (this "Amendment"), dated as of December 7, 2006,
among Tecumseh Products Company, a Michigan corporation (the "Borrower"), TRICAP
PARTNERS, LLC, as Lender and Administrative Agent (in such capacities, the
"Lender"), and Citicorp USA, Inc., as Collateral Agent for the Lender (in such
capacity, the "Collateral Agent"), amends certain provisions of the AMENDED AND
RESTATED SECOND LIEN CREDIT AGREEMENT, dated as of November 13, 2006 (as amended
hereby, and as it may be further amended, supplemented or otherwise modified
from time to time, the "Credit Agreement"), among the Borrower, the Lender and
the Collateral Agent.
WITNESSETH:
WHEREAS, the Borrower has informed the Lender of its desire to enter
into certain agreements in connection with the restructuring of the TMT
Indebtedness; and
WHEREAS, the Borrower has requested, and the Lender and the Collateral
Agent have agreed to amend the Credit Agreement as set forth below;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and provisions hereinafter contained, the parties hereto hereby agree
as follows:
1. DEFINED TERMS. Capitalized terms used herein and not defined herein but
defined in the Credit Agreement are used herein as defined in the Credit
Agreement.
2. AMENDMENT TO THE CREDIT AGREEMENT. As of the First Amendment Effective
Date (as defined in Section 4), the Credit Agreement is hereby amended as
follows:
(a) Section 1.1 of the Credit Agreement is hereby amended by adding
the following defined terms in alphabetical order:
"Amendment No. 1 to the Credit Agreement" means that certain Amendment
No. 1 to Amended and Restated Second Lien Credit Agreement, dated as of
December 7, 2006, entered into by the Borrower, the Lender and the
Collateral Agent.
"Restructuring Agreement" means that certain Out-of-Court
Restructuring Agreement (attached hereto as Exhibit B), dated as of
November 21, 2006, by and among TMT, the Borrower, Tecumseh Power Company
and certain financial institutions party thereto.
"Supply Agreement" means that certain Supply Agreement, dated as of
November 21, 2006, between Tecumseh Power Company and TMT, in the form
attached as Exhibit 3.1 to the Restructuring Agreement.
"TMT Guaranty Agreement" means a Guaranty Agreement (substantially in
the form attached hereto as Exhibit A) to be entered into upon
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the satisfaction of the TMT Guaranty Conditions by and among the Borrower,
as the guarantor, and certain financial institutions that are party to the
Restructuring Agreement, as the guarantied parties.
"TMT Guaranty Conditions" means those conditions set forth in Section
5.2(g) of the Restructuring Agreement.
(b) Article (II) Section 2.6(b) is hereby amended by inserting the
following as the last sentence thereof:
In addition, in the event that the Obligations are prepaid in
full (or required to be paid in full as provided hereunder) on or before
March 31, 2008, or after March 31, 2008 from the Net Proceeds of an Asset
Sale with respect to which a definitive agreement was in place on or before
March 31, 2008, such prepayment shall be accompanied by a fee to the Lender
in the amount of $1,000,000.
(c) Article (VI) Section 6.1(i) is hereby amended by (A) deleting the
word "Tuesday" and inserting the word "Wednesday" and (B) inserting the
following as the last sentence thereof:
Each such forecast shall be accompanied by a report certified to
be accurate to the best of such officer's knowledge by a Responsible
Officer of the Borrower detailing variances between actual cash receipts
and disbursements for the week just completed and the cash receipts and
disbursements that had been forecast for such week in the immediately
preceding cash flow forecast delivered pursuant hereto.
(d) Article (VIII) Section 8.1 (f) is hereby amended by deleting
clause (iii) therein and inserting the following in lieu thereof:
(iii) from any Non-Guarantor Subsidiary (other than TMT solely to
the extent prohibited under the Restructuring Agreement) to the Borrower or
any Guarantor
(e) Article (VIII) Section 8.2 is hereby amended by deleting clause
(g) therein and inserting the following in lieu thereof:
(g) Liens securing any Indebtedness of Excluded Foreign Subsidiaries
permitted under Section 8.1(b),(i), (j) or (k) (including Liens granted by TMT
on certain of its property to secure its Indebtedness pursuant to the
Restructuring Agreement (as in effect on the date hereof)); and
(f) Article (VIII) Section 8.10 is hereby amended by deleting the
existing clause (a) therein and inserting the following in lieu thereof:
(a) agree to enter into or suffer to exist or become effective
any consensual encumbrance or restriction of any kind on the ability of
such
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Subsidiary (other than TMT solely to the extent required under the
Restructuring Agreement) to pay dividends or make any other distribution or
transfer of funds or assets or make loans or advances to or other
Investments in, or pay any Indebtedness owed to, the Borrower or any other
Subsidiary of the Borrower
(g) Article (VIII) (Negative Covenants) is hereby amended by inserting
the following new Section 8.19 after the existing Section 8.18 to read as
follows:
Section 8.19 Amendment of TMT Agreements
Neither the Borrower nor any of its Subsidiaries shall change or
amend the terms of the Restructuring Agreement, the Supply Agreement, the
TMT Guaranty Agreement or any other agreement or instrument related to the
TMT Indebtedness, or enter into any other agreement or instrument that has
the effect of varying the terms thereof, in any material respect that is
adverse to the Borrower or any Subsidiary or the Lender.
3. CONSENT. (a) The Lender and the Collateral Agent hereby consent to the
terms contained in the Supply Agreement, the TMT Guaranty Agreement and the
Restructuring Agreement, as in effect on the date hereof; provided, however, the
Borrower hereby acknowledges that neither the Lender nor the Collateral Agent
shall be bound by (or shall be deemed to be subject to) Section 5.2(b) of, and
any other provision in, the Restructuring Agreement that restricts or purports
to restrict the sale or transfer of the Stock of TMT, or otherwise requires the
prior written approval of the banks party thereto in connection with such sale
or transfer.
(b) Lender hereby consents to the Borrower's request of a one time
extension of the delivery date of the quarterly report solely for the Fiscal
Quarter of September 2006, due within 45 days after the end of such Fiscal
Quarter pursuant to Section 6.1(b) of the Credit Agreement, to December 20,
2006.
4. CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF THIS AMENDMENT. This
Amendment shall become effective on the date (the "First Amendment Effective
Date") when the Lender shall have received all of the following, each of which
shall be in form and substance satisfactory to the Lender:
(a) Certain Documents. The Lender shall have received each of the
following, in form and substance satisfactory to the Lender:
(i) this Amendment, executed by the Borrower and the Collateral
Agent;
(ii) the Consent of Guarantors, in the form set forth hereto as
Exhibit C, executed by each Guarantor;
(iii) Amendment No. 4 to the First Lien Credit Agreement,
executed by the Borrower and the First Lien Secured Parties; and
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(iv) such additional documentation as the Lender may reasonably
require.
(b) Payment of Fees, Costs and Expenses. The Lender shall have
received payment of all fees, costs and expenses as required by Sections 8 and 9
hereof, including, without limitation, all fees, costs and expenses of the
Lender (including, without limitation, the reasonable fees and out-of-pocket
expenses of counsel for the Lender) in connection with this Amendment, the
Credit Agreement and each other Loan Document.
(c) Representations and Warranties. Each of the representations and
warranties contained in Section 5 below shall be true and correct.
(d) No Default or Event of Default. After giving effect to this
Amendment and Amendment No. 4 to the First Lien Credit Agreement, no Default or
Event of Default shall have occurred and be continuing.
5. REPRESENTATIONS AND WARRANTIES. On and as of the date hereof, and as of
the First Amendment Effective Date, after giving effect to this Amendment and
Amendment No. 4 to the First Lien Credit Agreement, the Borrower hereby
represents and warrants to the Lender as follows:
(a) Each of the representations and warranties contained in Article IV
of the Credit Agreement, the other Loan Documents or in any certificate,
document or financial or other statement furnished at any time under or in
connection therewith are true and correct in all material respects on and as of
the date as if made on and as of such date, except to the extent that such
representations and warranties specifically relate to a specific date, in which
case such representations and warranties shall be true and correct in all
material respects as of such specific date; and
(b) No Default or Event of Default has occurred and is continuing.
6. CONTINUING EFFECT; NO OTHER AMENDMENTS. Except as expressly amended
hereby, all of the terms and provisions of the Credit Agreement and the other
Loan Documents are and shall remain in full force and effect. The amendments and
consents contained herein shall not constitute an amendment or a waiver of any
other provision of the Credit Agreement or the other Loan Documents or for any
other purpose except as expressly set forth herein.
7. LOAN DOCUMENTS. This Amendment is deemed to be a "Loan Document" for the
purposes of the Credit Agreement.
8. FEES. As consideration for the execution of this Amendment, the Borrower
agrees to pay on the First Amendment Effective Date to the Lender a fee equal to
$250,000.
9. COSTS AND EXPENSES. The Borrower agrees to pay on demand on the First
Amendment Effective Date all costs and expenses of the Lender incurred from and
after the Closing Date through and including the First Amendment Effective Date
and payable to the Lander under Section 11.3 of the Credit Agreement, including,
without limitation, all reasonable and documented out-of-pocket costs and
expenses of the Lender in connection with the
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preparation, execution and delivery of this Amendment and other instruments and
documents to be delivered pursuant hereto, including the reasonable and
documented fees and out-of-pocket expenses of counsel for the Lender with
respect thereto.
10. GOVERNING LAW; COUNTERPARTS; MISCELLANEOUS.
(a) This Amendment shall be governed by, and construed and interpreted
in accordance with, the law of the State of New York.
(b) This Amendment may be executed in any number of counterparts and
by the different parties on separate counterparts, each of which counterparts
when executed and delivered shall be an original, but all of which shall
together constitute one and the same instrument.
(c) Section captions used in this Amendment are for convenience only
and shall not affect the construction of this Amendment.
(d) From and after the First Amendment Effective Date, all references
in the Credit Agreement to the "Agreement" shall be deemed to be references to
such Agreement as modified hereby and this Amendment and the Credit Agreement
shall be read together and construed as a single instrument.
[signature pages follow]
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IN WITNESS WHEREOF, the undersigned parties have executed this
Amendment No. 1 to the Credit Agreement to be effective for all purposes as of
the First Amendment Effective Date.
Borrower
TECUMSEH PRODUCTS COMPANY
as Borrower
By:
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President, Treasurer and
Chief Financial Officer
[SIGNATURE PAGE TO AMENDMENT NO. 1 TO AMENDED AND RESTATED SECOND LIEN CREDIT
AGREEMENT]
Lender
TRICAP PARTNERS, LLC
as Lender and Administrative Agent
By:
------------------------------------
Name: Alexander Greeene
Title: President
[SIGNATURE PAGE TO AMENDMENT NO. 1 TO AMENDED AND RESTATED SECOND LIEN CREDIT
AGREEMENT]
Collateral Agent
Citicorp USA, Inc.,
as Collateral Agent
By:
------------------------------------
Name: Sebastien Delasnerie
Title: Vice President
[SIGNATURE PAGE TO AMENDMENT NO. 1 TO AMENDED AND RESTATED SECOND LIEN CREDIT
AGREEMENT]
EXHIBIT A
TMT GUARANTY AGREEMENT
[EXHIBIT A]
EXHIBIT B
RESTRUCTURING AGREEMENT
[EXHIBIT B]
EXHIBIT C
CONSENT OF GUARANTORS
Dated as of December 7, 2006
Each of the undersigned companies, as a Guarantor under the Guaranty
dated November 13, 2006 (the "Guaranty") in favor of the Secured Parties under
the Credit Agreement referred to in the foregoing Amendment, hereby consents to
such Amendment and hereby confirms and agrees that notwithstanding the
effectiveness of such Amendment, the Guaranty is, and shall continue to be, in
full force and effect and is hereby ratified and confirmed in all respects,
except that, on and after the effectiveness of such Amendment, each reference in
the Guaranty to the "Credit Agreement", "thereunder", "thereof" or words of like
import shall mean and be a reference to the Credit Agreement, as amended by such
Amendment.
[Signature pages follow]
[EXHIBIT C]
IN WITNESS WHEREOF, the parties hereto have consented to this
Amendment No. 1, as of the date first written above.
CONVERGENT TECHNOLOGIES INTERNATIONAL,
INC.
TECUMSEH TRADING COMPANY
EVERGY, INC.
FASCO INDUSTRIES, INC.
MANUFACTURING DATA SYSTEMS, INC.
M. P. PUMPS, INC.
TECUMSEH CANADA HOLDING COMPANY
TECUMSEH COMPRESSOR COMPANY
TECUMSEH POWER COMPANY
XXX XXXXX GEAR COMPANY
as U.S. Guarantors
By:
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President and Treasurer
EUROMOTOR, INC.
as U.S. Guarantor
By:
-------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
XXXXXX PROPERTY COMPANY, LLC
Tecumseh do Brasil USA, LLC
as U.S. Guarantors
By:
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: President
[SIGNATURE PAGE TO GUARANTOR CONSENT TO AMENDMENT NO. 1 TO AMENDED AND RESTATED
SECOND LIEN CREDIT AGREEMENT]
TECUMSEH PRODUCTS OF CANADA LIMITED,
as Canadian Guarantor
By:
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President and Treasurer
FASCO MOTORS COMPANY,
as Canadian Guarantor
By:
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
[SIGNATURE PAGE TO GUARANTOR CONSENT TO AMENDMENT NO. 1 TO AMENDED AND RESTATED
SECOND LIEN CREDIT AGREEMENT]
