THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "AMENDMENT") is entered
into as of March 31, 1999, among DRYPERS CORPORATION, a Delaware corporation
(the "BORROWER"), the bank or banks listed on the signature pages hereof
(collectively, the "BANKS"), and BANKBOSTON, N.A., a national banking
association, individually and as agent for itself and the other Banks and as
issuer of Letters of Credit (in its capacity as agent, the "AGENT").
R E C I T A L S:
A. The Agent, the Borrower and the Banks have entered into that certain
Credit Agreement dated as of April 1, 1998 as amended by a certain First
Amendment to Credit Agreement dated September 9, 1998 and by a certain Second
Amendment to Credit Agreement dated December 30, 1998 (such Credit Agreement, as
the same has previously been amended and as the same may now or hereafter be
amended, modified, or supplemented from time to time, being the "CREDIT
AGREEMENT"), pursuant to which the Banks established a revolving credit facility
for the Borrower in an amount not to exceed $50,000,000.
B. The Borrower has requested the Agent and the Banks to amend certain
definitions and financial covenants contained in the Credit Agreement and to
consent to certain transactions proposed by the Borrower, which the Agent and
the Banks are willing to do subject to the terms and conditions hereof.
C. The Borrower, the Agent and the Banks desire to amend the Credit
Agreement as set forth herein.
A G R E E M E N T S:
NOW, THEREFORE, in consideration of the premises and other valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Borrower, the Banks and the Agent agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Unless otherwise specified herein,
terms defined in the Credit Agreement have the same meaning when used herein.
ARTICLE II
AMENDMENTS
Section 2.1 AMENDMENT TO DEFINITION OF APPLICABLE MARGIN. Effective as of
the date hereof, the definition of "Applicable Margin" appearing in SECTION 1.1
of the Credit Agreement is hereby amended in its entirety to read as follows:
"APPLICABLE MARGIN" means, for any day, (a) with respect to
Eurodollar Advances, the margin of interest over the Eurodollar Rate that
is applicable when any Applicable Rate based on the Eurodollar Rate is
determined under this Agreement, and (b) with respect to Alternate Base
Rate Advances, the margin of interest over the Alternate Base Rate that is
applicable when any Applicable Rate based on the Alternate Base Rate is
determined under this Agreement. The Applicable Margin is subject to
adjustment (upwards or downwards, as appropriate) based on the ratio of
Consolidated Funded Debt to Adjusted Consolidated EBITDA. Effective as of
each Adjustment Date, the Applicable Margin shall be adjusted to reflect
the Applicable Margin prescribed below for the ratio of Consolidated
Funded Debt to Adjusted Consolidated EBITDA as demonstrated by the most
recently delivered Compliance Certificate:
RATIO OF
CONSOLIDATED FUNDED APPLICABLE
DEBT MARGIN
TO APPLICABLE MARGIN FOR ALTERNATE
ADJUSTED CONSOLIDATED FOR EURODOLLAR BASE
EBITDA ADVANCES RATE ADVANCES
------ -------- -------------
Less than or equal to
3.00 to 1.00 1.50% 0.00%
Greater than 3.00 to
1.00, but less than or
equal to 3.50 to 1.00 1.75% 0.00%
Greater than 3.50 to
1.00, but less than or
equal to 4.00 to 1.00 2.00% 0.25%
Greater than 4.00 to
1.00, but less than or
equal to 4.50 to 1.00 2.25% 0.50%
Greater than 4.50 to
1.00, but less than or
equal to 5.00 to 1.00 2.50% 0.75%
Greater than 5.00 to
1.00, but less than or
equal to 5.50 to 1.00 2.75% 1.00%
Greater than 5.50 to
1.00 3.25% 1.50%
The Applicable Margin shall be 3.25% for Eurodollar Advances and 1.50% for
Alternate Base Rate Advances from April 1, 1999 until the first Adjustment
Date after December 31, 1999 that the Compliance Certificate demonstrates
a change in the ratio of Consolidated Funded Debt to Adjusted Consolidated
EBITDA to a level for which another Applicable Margin shall apply, or
until another Applicable Margin is otherwise applicable. After each
adjustment of the Applicable Margin in accordance herewith due to a change
in the ratio of Consolidated Funded Debt to Adjusted Consolidated EBITDA
as demonstrated by the Compliance Certificate, the new Applicable Margin
shall apply to all Advances made or outstanding thereafter until the next
Adjustment Date as of which the Compliance Certificate demonstrates a
change in the ratio of Consolidated Funded Debt to Adjusted Consolidated
EBITDA to a level for which another Applicable Margin shall apply. Upon
the request of the Agent, the Borrower must demonstrate to the reasonable
satisfaction of the Required Banks the required applicable ratio in order
to obtain an adjustment to a lower Applicable Margin. If the Borrower
fails to furnish to the Agent any Compliance Certificate (with
accompanying financial statements) by the date required by this Agreement,
then the maximum Applicable Margin shall apply at all times after such
date for all Advances made or outstanding after such date until the
Borrower furnishes the required Compliance Certificate (with accompanying
financial statements) to the Agent.
Section 2.2 ADDITIONAL DEFINITION OF ARGENTINE INSURANCE CLAIMS. Effective
as of the date hereof, SECTION 1.1 of the Credit Agreement is hereby amended to
add thereto a definition of "Argentine Insurance Claims" to read as follows:
"ARGENTINE INSURANCE CLAIMS" means the claims of Borrower or any
Subsidiary under BRB Seguros S.A. Policy No. 61869 and Chubb Group of
Insurance Companies Policy No. 3533-10-03CCG relating to the August 8,
1998 fire at the manufacturing facility of Borrower's Subsidiary in
Argentina.
Section 2.3 AMENDMENT TO DEFINITION OF CONSOLIDATED ADJUSTED OPERATING
CASH FLOW. Effective as of the date hereof, the definition of "Consolidated
Adjusted Operating Cash Flow" appearing in SECTION 1.1 of the Credit Agreement
is hereby amended in its entirety to read as follows:
"CONSOLIDATED ADJUSTED OPERATING CASH FLOW" means, for any period
the sum of, without duplication, (a) Consolidated EBITDA, minus (b) cash
payments of state and federal income and franchise taxes, minus (c) (i)
all Capital Expenditures not in excess of $2,000,000 for each fiscal
quarter during the fiscal year ending December 31, 1998, and (ii) all
Capital Expenditures for each fiscal quarter during each fiscal year
ending subsequent to December 31, 1998, plus (d) cash proceeds received by
the Borrower or any of its Subsidiaries arising from the Mexican
Sale/Leaseback Transaction.
Section 2.4 AMENDMENT TO DEFINITION OF CONSOLIDATED EBITDA. Effective as
of the date hereof, the definition of "Consolidated EBITDA" appearing in SECTION
1.1 of the Credit Agreement is hereby amended in its entirety to read as
follows:
"CONSOLIDATED EBITDA" means, for any period the sum of, without
duplication, Consolidated Net Income for such period, plus (or, in the
case of clause (e) below, plus or minus) the following items to the extent
included in computing Consolidated Net Income for such period: (a) the
amount that, in conformity with GAAP, would be set forth opposite the
caption "interest expense" (or any like caption) on a consolidated
statement of earnings of the Borrower and its Restricted Subsidiaries for
such period, including, without limitation, (i) amortization of debt
discount, (ii) the net cost of interest rate contracts (including
amortization of discounts), (iii) the interest portion of any deferred
payment obligation, (iv) amortization of debt issuance costs and (v) the
interest component of Capital Lease Obligations, plus (b) the provision
for federal, state, local and foreign income or franchise taxes of the
Borrower and its Restricted Subsidiaries for such period, plus (c) the
aggregate depreciation and amortization expense of the Borrower and its
Restricted Subsidiaries for such period, plus (d) $6,000,000 for the
fiscal quarter ending March 31, 1998 and $2,000,000 for the fiscal quarter
ending June 30, 1998, plus (e) any other non-cash charges for such period,
and minus non-cash credits for such period (including, without limitation,
for the fiscal quarter ending March 31, 1999 and thereafter, any gains on
the settlement of the Argentine Insurance Claims recorded as "Other
Income" on the Borrower's consolidated income statement), other than
non-cash charges or credits resulting from changes in reserves for
accounts receivable and inventory, prepaid assets or accrued liabilities
in the ordinary course of business, plus (f) income from Unrestricted
Subsidiaries accounted for under the equity method of accounting, provided
that such income is actually paid in cash to the Borrower or a Restricted
Subsidiary during such period, plus (g) the amount of the charge actually
recorded for the fiscal quarter ending December 31, 1998 as a result of
the discontinuance of laundry detergent operations and the writeoff of
Borrower's Investment in LSFNE Company and NewLund Laboratories, Inc.,
such amount not to exceed $6,500,000, plus (h) for the fiscal quarter
ending March 31, 1999 and thereafter, cash proceeds received by the
Borrower or any of its Subsidiaries from the settlement of the Argentine
Insurance Claims.
Section 2.5 DELETION OF DEFINITION OF MAINTENANCE CAPITAL EXPENDITURES.
Effective as of the date hereof, the definition of "Maintenance Capital
Expenditures" appearing in SECTION 1.1 of the Credit Agreement is hereby deleted
in its entirety.
Section 2.6 ADDITIONAL DEFINITION OF MEXICAN SALE/LEASEBACK TRANSACTION.
Effective as of the date hereof, SECTION 1.1 of the Credit Agreement is hereby
amended by adding thereto a definition of "Mexican Sale/Leaseback Transaction"
to read as follows:
"MEXICAN SALE/LEASEBACK TRANSACTION" means the sale by Drypers
Mexico SA de CV of its industrial facility located in Zapopan, Mexico to
G. Accion SA de CV and the leaseback of such facility for the
consideration and upon the terms and conditions reflected in that certain
Letter of Intent dated February 9, 1999 between Drypers Mexico, SA de CV
and G. Accion SA de CV.
Section 2.7 AMENDMENT TO SECTION 2.1. Effective as of the date hereof,
SECTION 2.1 of the Credit Agreement is hereby amended by adding the following
sentence at the end thereof:
Notwithstanding the foregoing, for the period commencing on April 1, 1999
and continuing through and including December 31, 1999, Borrower's
borrowings hereunder consist solely of Alternate Base Rate Advances and,
to the extent that any Eurodollar Advances were outstanding as of March
31, 1999, such Eurodollar Advances shall be deemed to have been Converted
into Alternate Base Rate Advances as of April 1, 1999 without Borrower
being liable for the payment of any compensation pursuant to SECTION 5.5
hereof.
Section 2.8 AMENDMENT TO SECTION 9.1. Effective as of the date hereof,
SECTION 9.1 of the Credit Agreement is hereby amended by adding the following
subsection (m) thereto which shall read as follows:
(m) CASH FORECAST REPORT. On or before Monday of each week
commencing April 5, 1999, a cash forecast report, in form and substance
satisfactory to the Agent, setting forth the anticipated sources and uses
of cash of the Borrower and its Subsidiaries for a period of not less than
eight weeks following the date of such report.
Section 2.9 AMENDMENT TO SECTION 9.6. Effective as of the date hereof,
SECTION 9.6 of the Credit Agreement is hereby amended by adding the following
sentence at the end thereof:
Without limiting the generality of the foregoing, Borrower will fully
cooperate, and will cause its Restricted Subsidiaries to fully cooperate,
with both (i) the Agent's audit and asset management review staff in
conducting a field exam of the Collateral and Borrower's books and records
and (ii) Xxxxx-Xxxxxx Corp. in conducting an appraisal of Borrower's
domestic assets, such inspections to be conducted in March and April of
1999, and, upon completion of such field exam and appraisal, Borrower will
negotiate in good faith with the Agent concerning a restructuring of the
revolving credit facility with a view to completing such restructuring on
or prior to June 10, 1999. In the event such restructuring shall not have
been completed by June 10, 1999, Borrower shall pay to the Agent on June
10, 1999 a supplemental commitment fee equal to $500,000 in consideration
of the Banks continuing to make Advances hereunder.
Section 2.10 ADDITION OF SECTIONS 9.11. Effective as of the date hereof,
ARTICLE IX of the Credit Agreement is hereby amended by adding SECTION 9.11
thereto which shall read as follows:
9.11. DEPOSIT ACCOUNTS. On or prior to April 30, 1999, the Borrower
or a Subsidiary will execute, and will cause each financial institution in
which it maintains domestic deposit accounts to execute, a deposit account
agreement (the "ACCOUNT AGREEMENT") in favor of the Agent with respect to
each of such domestic deposit accounts, such Account Agreement to be in
form and substance satisfactory to the Agent. Neither Borrower nor any
Subsidiary will open any new domestic deposit account unless such deposit
account is covered by a fully executed Account Agreement in favor of the
Agent.
Section 2.11 AMENDMENT TO SECTION 11.2. Effective as of the date hereof,
SECTION 11.2 of the Credit Agreement is hereby amended in its entirety to read
as follows:
11.2 CONSOLIDATED FIXED CHARGE COVERAGE RATIO. The Borrower will maintain
or cause to be maintained, as of the end of each fiscal quarter of the
Borrower (beginning with the quarter ended September 30, 1998), a
Consolidated Fixed Charge Coverage Ratio of not less than the ratios set
forth below for the most recent four (4) fiscal quarters then ended:
RATIO FISCAL QUARTER ENDING
----- ---------------------
1.0 to 1.0 September 30, 1998
1.0 to 1.0 December 31, 1998
0.9 to 1.0 March 31, 1999
1.0 to 1.0 June 30, 1999
1.1 to 1.0 September 30, 1999
1.25 to 1.0 December 31, 1999
1.50 to 1.0 March 31, 2000
1.50 to 1.0 June 30, 2000
September 30, 2000 and
1.75 to 1.0 thereafter
Section 2.12 AMENDMENT TO ARTICLE XI. Effective as of the date hereof,
Article XI of the Credit Agreement is hereby amended by adding thereto the
following SECTIONS 11.5 and 11.6 which shall read as follows:
11.5 MINIMUM AVAILABILITY. The Borrower will maintain Availability
(hereinafter defined) of not less than the following amounts at all times
during the respective periods set forth below:
AMOUNT PERIOD
------ ------
From March 26, 1999
through
$3,500,000 April 29, 1999
From April 30, 1999
through
$7,000,000 June 8, 1999
From June 9, 1999 through
$12,000,000 June 10, 1999
From June 11, 1999
$5,000,000 through August 30, 1999
From August 31, 1999
$7,000,000 through September 29, 1999
From September 30, 1999
$8,000,000 through November 29, 1999
From November 30, 1999
$10,000,000 through December 30, 1999
From December 31, 1999
$12,000,000 and thereafter
For purposes hereof, "Availability" means, as of any date, the amount
calculated as the net availability for Advances pursuant to the most
recent Advance Request Form (after giving effect to any Advance requested
thereunder), or Borrowing Base Report submitted by the Borrower to the
Agent.
Section 2.13 AMENDMENT TO SCHEDULE 8.14. Effective as of the date hereof,
Schedule 8.14 of the Credit Agreement is hereby amended in its entirety to read
as set forth in Exhibit 1 attached to this Amendment.
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 CONDITIONS. The effectiveness of this Amendment is
subject to the satisfaction of the following conditions precedent:
(a) The Agent shall have received all of the following, in form and
substance satisfactory to the Agent:
(1) RESOLUTIONS. Resolutions of the Board of Directors of the
Borrower certified by its secretary or an assistant secretary which
authorize the execution, delivery and performance by the Borrower of
this Amendment and any other Loan Documents executed and/or
delivered in connection herewith;
(2) INCUMBENCY CERTIFICATE. A certificate of incumbency
certified by the secretary or an assistant secretary of the Borrower
certifying the names of the officers of the Borrower who are
authorized to sign this Amendment and any other Loan Documents
executed and/or delivered in connection herewith, together with
specimen signatures of such officers;
(3) GOVERNMENTAL CERTIFICATES. Certificates of the appropriate
governmental officials of the jurisdiction of incorporation of the
Borrower as to the existence and good standing of the Borrower, each
dated a current date;
(4) OPINION OF COUNSEL. A favorable opinion of Fulbright &
Xxxxxxxx, L.L.P., legal counsel to the Borrower, as to such matters
as the Agent may reasonably request; and
(5) INTERCOMPANY LOAN DOCUMENTATION. To the extent not
previously received and approved, documentation (including without
limitation promissory notes, security agreements and financing
statements) satisfactory to Agent evidencing advances made or to be
made by the Borrower (excluding transfers of inventory and
allocations of corporate overhead and expenses made in the ordinary
course of business) to the Foreign Subsidiaries or the Foreign
Affiliates and obligations of the Foreign Subsidiaries and the
Foreign Affiliates to repay such advances;
(6) DEPOSIT ACCOUNTS. A detailed listing of all domestic
deposit accounts maintained by the Borrower or any of its
Subsidiaries;
(7) ADDITIONAL INFORMATION. Such additional documents,
instruments and information as the Agent or its legal counsel,
Xxxxxxxx Xxxxxxxx & Xxxxxx P.C., may reasonably request.
(b) The representations and warranties contained herein and in all
other Loan Documents, as amended hereby, shall be true and correct as of
the date hereof as if made on the date hereof, except for such
representations and warranties as are limited by their express terms to a
specific date.
(c) No Default shall have occurred and be continuing.
(d) The Agent shall have received an amendment fee in the amount
of $25,000.
(e) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all documents,
instruments, and other legal matters incident thereto shall be reasonably
satisfactory to the Agent and its legal counsel, Xxxxxxxx Xxxxxxxx &
Xxxxxx P.C.
ARTICLE IV
CONSENTS
Section 4.1 CONSENT TO MEXICAN SALE/LEASEBACK TRANSACTION. Pursuant to
SECTIONS 10.1, 10.5 and 10.7 of the Credit Agreement, the Borrower has requested
that the Agent consent to the Mexican Sale/Leaseback Transaction. Subject to the
conditions described in SECTION 4.2 below, the Agent hereby consents to the
Mexican Sale/Leaseback Transaction and agrees that such transactions shall not
constitute a breach or violation of the Credit Agreement. The consent granted
herein is limited to the Mexican Sale/Leaseback Transaction, and nothing
contained herein shall be construed as a consent by the Agent or the Banks with
respect to any other transaction.
Section 4.2 CONDITIONS TO CONSENT. The consent to the Mexican
Sale/Leaseback Transaction granted under SECTION 4.1 above is subject to
compliance with the following conditions:
(a) The cash consideration paid by G. Accion SA de CV to Drypers
Mexico SA de CV in connection with the Mexican Sale/Leaseback Transaction
shall not be less than $5,000,000;
(b) The Promise to Purchase Agreement and the Lease, each between G.
Accion SA de CV and Drypers Mexico SA de CV, shall be in form and
substance satisfactory to the Agent; and
(c) The Mexican Sale/Leaseback Transaction shall be consummated no
later than May 31, 1999.
Section 4.3 CONSENT TO COLOMBIAN JOINT VENTURE. Drypers Limited proposes
to structure and organize a joint venture with Conticauca S.A. to manufacture
and distribute diapers in the Andean region by means of the incorporation of a
Colombian corporation to be known as Drypers Andina & CIA, S.C.A. ("Drypers
Andina") pursuant to the terms of a Letter of Intent dated February 9, 1999 (the
"Colombian Joint Venture"). Pursuant to Sections 10.3, 10.5 and 10.7 of the
Credit Agreement, the Borrower has requested that the Agent consent to the
Colombian Joint Venture. Subject to the conditions described in SECTION 4.4
below, the Agent hereby consents to the Colombian Joint Venture and agrees that
such transactions shall not constitute a breach or violation of the Credit
Agreement. The consent granted herein is limited to the Colombian Joint Venture
as reflected in such Letter of Intent dated February 9, 1999, and nothing
contained herein shall be construed as a consent by the Agent or the Banks with
respect to any other transaction.
Section 4.4 CONDITIONS TO CONSENT TO COLOMBIAN JOINT VENTURE. The consent
to the Colombian Joint Venture granted under Section 4.3 above is subject to
compliance with the following conditions:
(a) Drypers Andina shall be a Restricted Subsidiary, and Drypers
Limited shall own not less than a 75% voting interest therein;
(b) The cash consideration equal to $1,750,000 and the non-cash
consideration equal to $6,200,000 which are paid or contributed by the
Borrower and Drypers Limited to Drypers Andina in connection with the
Colombian Joint Venture shall be included in all calculations for purposes
of SECTION 10.3(A)(IV) and (V) of the Credit Agreement; and
(c) The definitive agreements among Conticauca SA, Drypers Limited
and Drypers Andina with respect to the Colombian Joint Venture shall be in
form substance satisfactory to the Agent and, upon the Agent's approval of
such definitive agreements, the Agent will consent to the release of its
security interest in the PCMC diaper line located in Marion, Ohio;
provided that the value of such PCMC diaper line equal to $3,500,000 shall
be included in all calculations for purposes of SECTION 10.7(F)(III) of
the Credit Agreement. Section 4.5 CONSENTS RELATING TO MALAYSIAN LINES OF
CREDIT. Drypers
Malaysia Sdn Bhd ("Drypers Malaysia") proposes to obtain lines of credit in an
aggregate amount not to exceed $5,000,000 (the "Malaysian Lines of Credit"). As
a condition to obtaining the Malaysian Lines of Credit, the lenders have
required that Drypers Malaysia agree not to pledge or encumber its assets.
Pursuant to SECTION 10.13 of the Credit Agreement, the Borrower has requested
that the Agent consent to the negative pledge relating to the assets of Drypers
Malaysia. The Agent hereby consents to the negative pledge relating to the
assets of Drypers Malaysia and agrees that such negative pledge shall not
constitute a breach or violation of SECTION 10.13 of the Credit Agreement. The
Agent hereby further consents, in connection with the Malaysian Lines of Credit,
to the Borrower's conversion of up to $5,000,000 of Drypers Malaysia's debt to
the Borrower into equity. The consents granted herein are limited to the
negative pledge and conversion of debt to equity relating to the Malaysian Lines
of Credit, and nothing contained herein shall be construed as a consent by the
Agent or the Banks with respect to any other transaction.
ARTICLE V
RATIFICATIONS, REPRESENTATIONS AND WARRANTIES
Section 5.1 RATIFICATIONS. The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions set
forth in the Credit Agreement and, except as expressly modified and superseded
by this Amendment, the terms and provisions of the Credit Agreement and the
other Loan Documents are ratified and confirmed and shall continue in full force
and effect. The Borrower, the Agent, and the Banks agree that the Credit
Agreement as amended hereby and the other Loan Documents shall continue to be
legal, valid, binding and enforceable in accordance with their respective terms.
Section 5.2 REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents
and warrants to the Agent and the Banks that (a) the execution, delivery and
performance of this Amendment and any and all other Loan Documents executed
and/or delivered in connection herewith have been authorized by all requisite
corporate action on the part of Borrower and will not violate the articles of
incorporation or bylaws of Borrower, (b) the representations and warranties
contained in the Credit Agreement, as amended hereby, and in each other Loan
Document are true and correct on and as of the date hereof as though made on and
as of the date hereof, except for such representations and warranties as are
limited by their express terms to a specific date; (c) no Default has occurred
and is continuing,(d) Borrower is in full compliance with all covenants and
agreements contained in the Credit Agreement as amended hereby and the other
Loan Documents to which it is a party; and (e) none of the transactions
contemplated by the Mexican Sale/Leaseback Transaction, the Colombian Joint
Venture and the Malaysian Lines of Credit shall constitute a breach or violation
of, or a default under, the Indenture.
ARTICLE VI
MISCELLANEOUS
Section 6.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made in this Amendment or any Loan Documents
furnished in connection with this Amendment shall survive the execution and
delivery of this Amendment and the other Loan Documents, and no investigation by
the Agent or any closing shall affect the representations and warranties or the
right of the Agent and the Banks to rely upon them.
Section 6.2 REFERENCES. Each of the Loan Documents, including the Credit
Agreement and any and all other agreements, documents, or instruments now or
hereafter executed and delivered pursuant to the terms hereof or pursuant to the
terms of the Credit Agreement as amended hereby, are hereby amended so that any
reference in such Loan Documents to the Credit Agreement shall mean a reference
to the Credit Agreement as amended hereby.
Section 6.3 EXPENSES OF THE AGENT. As provided in the Credit Agreement,
the Borrower agrees to pay on demand all reasonable costs and expenses incurred
by the Agent in connection with the preparation, negotiation, and execution of
this Amendment and the other Loan Documents executed pursuant hereto and any and
all amendments, modifications, and supplements thereto, including without
limitation the costs and reasonable fees of the Agent's legal counsel, and all
costs and expenses incurred by the Agent and the Banks in connection with the
enforcement or preservation of any rights under the Credit Agreement, as amended
hereby, or any other Loan Document, including without limitation the costs and
reasonable fees of legal counsel for the Agent and, at any time following and
during the continuance of an Event of Default, of legal counsel to each Bank.
Without limiting the generality of the foregoing, the Borrower agrees to pay all
costs incurred by the Agent in connection with the appraisal of Borrower's
domestic assets by Xxxxx-Xxxxxx Corp. and the Agent's field exam, both of which
are currently in progress.
Section 6.4 GERMAN SUBSIDIARY. Within ten (10) days after the date hereof,
the Borrower shall deliver to the Agent a Negative Pledge Agreement executed by
Drypers (Germany) GmbH.
Section 6.5 SEVERABILITY. Any provision of this Amendment held by a court
of competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
Section 6.6 APPLICABLE LAW. THIS AMENDMENT AND ALL OTHER LOAN
DOCUMENTS EXECUTED PURSUANT HERETO SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
Section 6.7 COUNTERPARTS. This Amendment may be executed in a number of
identical counterparts, each of which shall be deemed an original. In making
proof of this instrument, it shall not be necessary for any party to account for
all counterparts, and it shall be sufficient for any party to produce but one
such counterpart bearing the signatures of all parties hereto.
Section 6.8 HEADINGS. The headings, captions, and arrangements
used in this Amendment are for convenience only and shall not affect the
interpretation of this Amendment.
Section 6.9 PARTIES BOUND. This Amendment is binding upon and shall inure
to the benefit of the Agent, the Banks and the Borrower and their respective
successors and assigns, except the Borrower may not assign or transfer any of
its rights or obligations hereunder without the prior written consent of the
Agent and all of the Banks.
Section 6.10 ENTIRE AGREEMENT. THIS AMENDMENT, THE CREDIT AGREEMENT, THE
LOAN DOCUMENTS, AND ALL OTHER INSTRUMENTS, DOCUMENTS AND AGREEMENTS EXECUTED AND
DELIVERED IN CONNECTION WITH THIS AMENDMENT REPRESENT THE FINAL AGREEMENT AMONG
THE PARTIES HERETO, AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES HERETO.
(Balance of page intentionally left blank.)
IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to
Credit Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
BORROWER:
DRYPERS CORPORATION
By: /s/ XXXXXXXX X. XXXXXX
Name:Xxxxxxxx X. Xxxxxx
Title: CFO & EXEC V.P.
AGENT AND BANKS:
BANKBOSTON, N.A., as Agent and as a Bank
By:/S/ XXXXXXX X. XXXXXXX
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
