Exhibit 99.2
FOURTH SUPPLEMENTAL INDENTURE ("Fourth Supplemental Indenture"), dated as
of October 1, 2003, among Phibro Animal Health Corporation, a New York
corporation (f/k/a Philipp Brothers Chemicals, Inc.) (the "Company"), each of
the Guarantors named herein (including each Guarantor whose guarantee is
confirmed by, or becomes effective pursuant to, this Fourth Supplemental
Indenture), as guarantors, and JPMorgan Chase Bank, as successor to The Chase
Manhattan Bank, as Trustee (the "Trustee"). All capitalized terms not otherwise
defined herein shall have the meaning assigned to them in the Indenture (as
defined herein).
WHEREAS, pursuant to a certain Indenture, dated as of June 11, 1998, among
the Company, the Guarantors named therein and the Trustee (the "Original
Indenture"), the Company issued its 9 7/8% Senior Subordinated Notes due 2008,
Series A and Series B (the "Notes"); and
WHEREAS, the Original Indenture was amended by a certain First Supplemental
Indenture, dated as of January 15, 1999, among the Company, the Guarantors named
therein and the Trustee (the "First Supplemental Indenture"), in order to, among
other things, effect the exchange of the Exchange Notes in replacement of the
Initial Notes; and
WHEREAS, the Original Indenture was further amended by a certain Second
Supplemental Indenture, dated as of March 19, 2003, among the Company, the
Guarantors named therein and the Trustee (the "Second Supplemental Indenture"),
in order to, among other things, effect certain amendments relating to two
Subsidiaries of the Company, Odda Holdings SA and Odda Smeltaverk SA; and
WHEREAS, the Original Indenture was further amended by a certain Third
Supplemental Indenture, dated as of March 19, 2003, among the Company, the
Guarantors named therein and the Trustee (the "Third Supplemental Indenture";
the Original Indenture, as amended by the First Supplemental Indenture, the
Second Supplemental Indenture and the Third Supplemental Indenture, and as
otherwise in effect on the date hereof, the "Indenture") in order, among other
things, to reflect each of Phibro Animal Health Holdings, Inc., a Delaware
corporation, and Phibro Animal Health U.S., Inc., a Delaware corporation, as a
Guarantor under the Indenture and the Notes; and
WHEREAS, in accordance with the Indenture, the Company has obtained the
written consent of the Holders of at least a majority in aggregate principal
amount of the outstanding Notes to certain amendments (the "Amendments") to the
Indenture as set forth in this Fourth Supplemental Indenture;
WHEREAS, pursuant to Sections 9.02 and 12.16 of the Indenture, the Company
and the Guarantors, when authorized by resolution of their respective Boards of
Directors, and the Trustee, together, with the written consent of the Holders of
at least a majority in aggregate principal amount of the Notes then outstanding,
are authorized to amend or supplement the Indenture as set forth in this Fourth
Supplemental Indenture;
WHEREAS, the Company, each of the Guarantors and the Trustee desire and
have agreed to execute and deliver this Fourth Supplemental Indenture as herein
provided and all conditions and requirements necessary to make this Fourth
Supplemental Indenture a valid, binding and legal instrument in accordance with
its terms have been performed and fulfilled and
the execution and delivery hereof have been in all respects duly authorized by
all necessary parties.
NOW, THEREFORE, for and in consideration of the premises contained herein,
it is mutually covenanted and agreed for the benefit of all Holders of the Notes
as follows:
Section 1. The Indenture is hereby amended as set forth below in this
Section 1:
a. Section 1.01. Section 1.01 (Definitions) of the Indenture is hereby
amended by deleting the following definitions set forth therein in entirety
and replacing them with the following definitions:
"Asset Sale" means (i) any sale, lease, conveyance or other
disposition by the Company or any Restricted Subsidiary of any assets
(including by way of a sale and leaseback) other than in the ordinary
course of business or (ii) the issuance or sale of Capital Stock of any
Restricted Subsidiary, in the case of each of (i) and (ii), whether in a
single transaction or a series of related transactions, to any Person
(other than to the Company or a Restricted Subsidiary and other than
directors' qualifying shares) for Net Proceeds in excess of $250,000. The
(i) disposition of property of the Company or any of its Restricted
Subsidiaries that, in the reasonable judgment of the Company, is no longer
useful in the conduct of the business of the Company and its Restricted
Subsidiaries, (ii) a Permitted Investment in a Permitted Joint Venture of
the Company, (iii) the MRT Sale and (iv) the PMC Sale Transactions shall
not constitute an Asset Sale.
"Designated Senior Debt" means (i) the Indebtedness under the Credit
Facility, (ii) the US Notes, the Dutch Notes and the related Guarantees,
and (iii) any other Senior Debt permitted to be incurred under this
Indenture the principal amount of which is $15.0 million or more (including
to a syndicate of lenders or an agent thereof) at the time of the
designation of such Senior Debt as "Designated Senior Debt" by the Company
in a written instrument delivered to the Trustee.
"Permitted Liens" means (i) Liens on assets or property of the Company
that secure Senior Debt and Liens on assets or property of a Guarantor that
secure Senior Debt; (ii) Liens securing Indebtedness of a Person existing
at the time that such Person is merged into or consolidated with the
Company or a Restricted Subsidiary; provided, however, that such Liens were
in existence prior to the contemplation of such merger or consolidation and
do not extend to any assets other than those of such Person; (iii) Liens on
property acquired by the Company or a Restricted Subsidiary; provided,
however, that such Liens were in existence prior to the contemplation of
such acquisition and do not extend to any property other than that of the
Person merged into or consolidated with the Company or such Restricted
Subsidiary; (iv) Liens in respect of Interest Rate Agreement Obligations
and Currency Agreement Obligations permitted under this Indenture;(v) Liens
in favor of the Company or any Restricted Subsidiary; (vi)
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Liens existing or created on the Issue Date; (vii) Liens securing the Notes
or the Guarantees; (viii) Liens to secure Attributable Debt that is
permitted to be incurred pursuant to Section 4.23; (ix) leases or subleases
granted to others that do not materially interfere with the ordinary course
of business of the Company and its Restricted Subsidiaries; (x) Liens
arising from filing Uniform Commercial Code financing statements regarding
leases; (xi) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods; (xii) Liens to secure obligations arising from
statutory, regulatory, contractual or warranty requirements of the Company
or any of its Restricted Subsidiaries, including the performance of
statutory obligations, surety or appeal bonds or performance bonds, or
landlords', carriers', warehousemen's, mechanics', suppliers',
materialmen's or other like Liens, in any case incurred in the ordinary
course of business and rights to offset and set off; (xiii) Liens for
taxes, assessments or governmental charges or claims that are not yet
delinquent or that are being contested in good faith by appropriate
proceedings promptly instituted and diligently concluded; provided that any
reserve or other appropriate provision as shall be required in conformity
with GAAP shall have been made therefor; (xiv) Liens securing Indebtedness
incurred to amend, modify, renew, refund, replace or refinance Indebtedness
that has been secured by a Lien permitted under this Indenture, provided
that (a) any such Lien not extend to or cover any assets or property not
securing the Indebtedness so refinanced and (b)the Refinancing Indebtedness
secured by such Lien shall have been permitted to be incurred under this
Indenture; (xv) Liens on assets of Foreign Subsidiaries securing
Indebtedness permitted by this Indenture and (xvi) Liens arising in
connection with the placement by the Company or any Restricted Subsidiary
of the Company, as the case may be, of a reasonable amount of cash (as
determined in good faith by such Person's board of directors) in escrow
against any obligations permitted by Section 4.12(b)(xvi).
b. Section 1.01. Section 1.01 of the Indenture is hereby amended by adding
the definitions to Section 1.01 in the corresponding alphabetical order:
"Dutch Notes" means Senior Secured Notes due 2007 of Philipp Brothers
Netherlands III BV (the "Dutch Issuer").
"MRT Sale" means the sale of payment of transaction expenses of
approximately $14 million in cash, subject to certain escrow arrangements
and post-closing adjustments.
"Palladium Preferred Stock" means the Series B Redeemable Participating
Preferred Stock and the Series C Redeemable Participating Preferred Stock
of the Company owned by Palladium Equity Partners II, LP and certain of its
affiliates.
"PMC Sale Transactions" the following transactions and payments,
including payments required pursuant to the documents evidencing such
transactions: (i) the transfer of ownership to the Palladium Investors of
The Prince Manufacturing Company ("PMC") (which would be valued at
approximately $21
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million); (ii) the reduction of the preferred stock of the Palladium
Investors to $15.2 million (as of September 30, 2003); (iii) the
termination of any obligation of the Company or any Restricted Subsidiary
of the Company in respect of the $2.25 million annual management advisory
fee (subject to reinstatement if these transactions are not consummated on
or before December 31, 2003); (iv) a separate cash payment to the Palladium
Investors of $10 million; (v) payments by PMC to the Company for central
support services for the next three years of $1 million, $0.5 million and
$0.2 million, respectively; (vi) supply arrangements between the Company
and PMC with respect to manganous oxide and red iron oxide; (vii) customary
representations, warranties and indemnities by the Company, and provisions
for closing working capital balance adjustments, settlement of intercompany
accounts owed to PMC, a closing fee payable to Palladium and the agreement
of the Company to pay or reimburse the Palladium Investors for their
reasonable out-of-pocket expenses; and (viii) the establishment by the
Company of a $1 million escrow or other credit support for two years to
secure its net working capital and foregoing indemnification obligations,
and indemnification of the Palladium Investors, payable after the maturity
of the Notes, for a portion, at the rate of $0.65 for every dollar, of the
amount they receive in respect of the disposition of PMC less than $21
million, up to a maximum payment by the Company of $4 million. The economic
terms set forth above are subject to the terms upon which intercompany
accounts would be settled, the amount of minimum working capital of PMC to
be agreed upon and the amount of the closing fee payable to the Palladium
Investors.
"US Notes" means Senior Secured Notes due 2007 of the Company.
c. Section 4.10. Section 4.10 (Limitation on Restricted Payments) of the
Indenture is hereby amended by inserting the following clauses (ix) and (x)
in Section 4.10(b):
"(ix) the PMC Sale Transactions; and
(x) the designation of MRT Holdings, LLC, MRT, Prince MFG, LLC and
PMC as Unrestricted Subsidiaries."
d. Section 4.10. Section 4.10 of the Indenture is hereby amended by
deleting Section 4.10(c) in entirety and replacing it with the following:
"(c) For purposes of Section 4.10(a)(iii), the Permitted Payments referred
to in clauses (i) and (v) above shall be included in the aggregate amount
of Restricted Payments made since the Issue Date, and any other Permitted
Payments described above shall be excluded."
e. Section 4.11. Section 4.11 (Limitation on Transactions with Affiliates)
of the Indenture is hereby amended by deleting "and" before "(v)" and
inserting the following additional provision in Section 4.11(b):
"and (vi) the PMC Sale Transactions".
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f. Section 4.12. Section 4.12 (Limitation on Incurrence of Indebtedness)
of the Indenture is hereby amended by deleting Section 4.12(b)(xiv) in entirety
and replacing it with the following:
"(xiv) Indebtedness of the Company or any Restricted Subsidiary in
addition to that described in clauses (i) through (xiii) above and
clauses (xv) and (xvi) below, and any amendments, modifications,
renewals, refundings, replacements or refinancings of such
Indebtedness, so long as the aggregate principal amount of all such
Indebtedness incurred pursuant to this clause (xiv) does not exceed
$5.0 million at any one time outstanding."
g. Section 4.12. Section 4.12 of the Indenture is hereby amended by
deleting "and" after "(;)" in clause (xiii) and inserting the following clauses
(xv) and (xvi) in Section 4.12(b):
"(xv) $105 million aggregate principal amount of the US Notes and
Dutch Notes and the related Guarantees; and
(xvi) Indebtedness arising from agreements of the Company or a
Restricted Subsidiary providing for the guarantee, indemnification,
adjustment of purchase or sales price or similar obligations, in each
case, incurred in connection with the disposition or exchange of any
business, assets or Subsidiary or consideration therefor, other than
guarantees of Indebtedness incurred by any Person acquiring all or any
portion of such business, assets or Subsidiary for the purpose of
financing such acquisition; provided that the maximum aggregate
liability in respect of such Indebtedness shall at no time exceed the
gross proceeds actually received by the Company and its Restricted
Subsidiaries in connection with such disposition."
h. Section 4.13. Section 4.13 (Limitation on Dividends and Other Payment
Restrictions Affecting Restricted Subsidiaries) of the Indenture is hereby
amended by replacing "and" with "," before "(i)" and inserting the following:
"and (j) the US Notes and Dutch Notes, the indenture governing
such US Notes and Dutch Notes, the related Guarantees and security and
collateral agreements."
i. Section 4.14. Section 4.14 (Limitation on Designation of Unrestricted
Subsidiaries) of the Indenture is hereby amended by inserting the following:
"(d) Notwithstanding the foregoing, the designation of MRT
Holdings, LLC, Prince MFG, LLC and PMC as Unrestricted Subsidiaries
shall be permitted without complying with Section 4.14(a); provided,
that MRT Holdings, LLC, Prince MFG, LLC and PMC shall be deemed to be
redesignated as Restricted Subsidiaries on January 1, 2004 if the PMC
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Sale Transactions shall not have been consummated on or prior to
such date."
j. Section 4.20. Section 4.20 (Limitation on Guarantees of Indebtedness by
Subsidiaries) of the Indenture is hereby amended by inserting the following:
"Notwithstanding the foregoing, Restricted Subsidiaries of the
Company may guarantee the US Notes and the Dutch Notes without
complying with this Section 4.20."
k. Section 12.04. Section 12.04 (Release of a Guarantor) of the Indenture
is hereby amended deleting Section 12.04(a) in entirety and replacing it
with the following:
"(a) So long as no Event of Default shall have occurred and be
continuing upon (i) the sale or disposition (whether by merger, stock
purchase, asset sale or otherwise) of a Guarantor (or all or
substantially all of the assets of any such Guarantor or 50% or more
of the Capital Stock of any such Guarantor) to an entity which is not
a Subsidiary of the Company, which transaction is otherwise in
compliance with this Indenture or (ii) the designation of any
Guarantor as an Unrestricted Subsidiary in compliance with this
Indenture, such Guarantor shall be deemed released from all its
obligations under its Guarantee of the Notes and under this Indenture;
provided, however, that any such termination shall occur only to the
extent that all obligations of such Guarantor under all its Guarantees
of, and under all of its pledges of assets or other security interests
which secure, any Indebtedness of the Company shall also terminate
upon such release, sale or transfer. Upon the release of any Guarantor
from its Guarantee pursuant to the provisions of the Indenture, each
other Guarantor not so released shall remain liable for the full
amount of principal of, and interest on, the Notes as and to the
extent provided in this Indenture."
Section 2. The Company and the Guarantors, agree that the Trustee is
permitted, and each of them hereby authorizes the Trustee, to place a notation
about this Fourth Supplemental Indenture on the Notes in accordance with the
provisions of Section 9.05 of the Indenture.
Section 3. The Trustee accepts this Fourth Supplemental Indenture and
agrees to execute the trust created by the Indenture as hereby supplemented, but
only upon the terms and conditions set forth in the Indenture, including the
terms and provisions defining and limiting the liabilities and responsibilities
of the Trustee, which terms and provisions shall in like manner define and limit
its liabilities and responsibilities in the performance of the trust created by
the Indenture as hereby supplemented.
Section 4. This Fourth Supplemental Indenture is executed and shall be
construed as an indenture supplemental to the Indenture and, as provided in the
Indenture, this Fourth
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Supplemental Indenture forms a part thereof. Except as otherwise expressly
provided for in this Fourth Supplemental Indenture, all of the terms and
conditions of the Indenture are hereby ratified and shall remain unchanged and
continue in full force and effect.
Section 5. The recitals contained in this Fourth Supplemental Indenture
shall be taken as the statements made solely by the Company and the Guarantors,
and the Trustee shall have no liability or responsibility for their correctness,
and, without limiting the generality of the foregoing, the Trustee shall not be
responsible in any manner whatsoever for or with respect to any of (i) the
validity or sufficiency of this Fourth Supplemental Indenture or any of the
terms or provisions hereof, (ii) the proper authorization hereof by the Company
and the Guarantors by corporate action or otherwise, (iii) the due execution
hereof by the Company and the Guarantors or (iv) the consequences (direct or
indirect and whether deliberate or inadvertent) of any amendment herein provided
for, and the Trustee makes no representation with respect to any such matters.
Section 6. This Fourth Supplemental Indenture shall become effective upon
the execution and delivery hereof by the Company, the Guarantors and the
Trustee.
Section 7. THIS FOURTH SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED IN THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 8. This Fourth Supplemental Indenture may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Fourth Supplemental
Indenture to be duly executed, all as of the date first written above.
PHIBRO ANIMAL HEALTH
CORPORATION,
a New York corporation
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Chief Financial Officer
C.P. CHEMICALS, INC.,
a New Jersey corporation, as Guarantor
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Financial Officer
PRINCE AGRIPRODUCTS, INC.,
a Delaware corporation, as Guarantor
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Financial Officer
PHIBROCHEM, INC.,
a New Jersey corporation, as Guarantor
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Financial Officer
PHIBRO CHEMICALS, INC.,
a New York corporation, as Guarantor
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Financial Officer
WESTERN MAGNESIUM CORP.,
a California corporation, as Guarantor
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Financial Officer
THE PRINCE MANUFACTURING COMPANY,
an Illinois corporation, as Guarantor
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Financial Officer
PHIBRO ANIMAL HEALTH HOLDINGS, INC.,
a Delaware corporation, as Guarantor
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Financial Officer
PHIBRO ANIMAL HEALTH U.S., INC.,
a Delaware corporation, as Guarantor
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Financial Officer
JPMORGAN CHASE BANK, as Trustee
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Authorized Officer
