LIMITED WAIVER AND AMENDMENT NO. 4
Exhibit 10.1
This LIMITED WAIVER AND AMENDMENT NO. 4 (this “Amendment”), is dated as of August 12,
2005, and is entered into by and among FLOWSERVE RECEIVABLES CORPORATION, a Delaware corporation
(“SPV”), FLOWSERVE US INC., a Delaware corporation (“Flowserve”), FLOWSERVE
CORPORATION, a New York corporation (the “Provider” and together with SPV and Flowserve,
the “Flowserve Entities”), the funding sources party hereto as the financial institutions
(the “Financial Institutions”), JUPITER SECURITIZATION CORPORATION (together with the
Financial Institutions, the “Purchasers”), and JPMORGAN CHASE BANK, N.A. (successor by
merger to Bank One, NA (Main Office Chicago)), as agent (the “Agent”) for the Purchasers.
W I T N E S S E T H:
WHEREAS, SPV, Flowserve, the Purchasers and the Agent are parties to that certain Receivables
Purchase Agreement, dated as of October 7, 2004 (as amended, restated, supplemented or otherwise
modified from time to time, the “RPA”);
WHEREAS, SPV and Flowserve are parties to that certain Receivables Sale Agreement, dated as of
October 7, 2004 (as amended, restated, supplemented or otherwise modified from time to time, the
“RSA”);
WHEREAS, the Provider executed a Performance Undertaking dated as of October 7, 2004 in favor
of SPV (as amended, restated, supplemented or otherwise modified from time to time, the
“Performance Undertaking” and together with the RSA and the RPA, the “Agreements”);
WHEREAS, pursuant to (a) Section 7.1(a)(i)(A) of the RPA, SPV is required to deliver audited
financial statements of the Provider and various other accompanying documents within 100 days after
the end of each fiscal year of the Provider, (b) Section 4.1(a)(i)(A) of the RSA, Flowserve is
required to deliver audited financial statements of the Provider and various other accompanying
documents within 100 days after the end of each fiscal year of the Provider and (c) Section 7(a)(1)
of the Performance Undertaking, the Provider is required to deliver audited financial statements of
the Provider and various other accompanying documents within 100 days after the end of each fiscal
year of the Provider;
WHEREAS, pursuant to that certain Amendment No. 3 and Limited Waiver dated as of March 10,
2005 by and among each of the parties hereto (the “Existing Waiver”), the Agent and the
Purchasers (as assignees of SPV’s interests under the Performance Undertaking and the RSA) have
waived, subject to the terms and conditions of the Existing Waiver, any noncompliance with such
requirements under the Agreements with respect to the fiscal year ended December 31, 2004 until
September 30, 2005 and any consequences resulting from such noncompliance during such period;
WHEREAS, the Flowserve Entities have requested that the Agent and the Purchasers (as assignees
of SPV’s interests under the Performance Undertaking and the RSA)
extend such waiver of any noncompliance with such requirements under the Agreements with
respect to the fiscal year ended December 31, 2004 until December 31, 2005 and any consequences
resulting from such noncompliance during such period;
WHEREAS, the Agent and the Purchasers have agreed to grant such limited waivers on the terms
and conditions set forth herein; and
WHEREAS, SPV, Flowserve, the Purchasers and the Agent desire to amend the RPA on the terms and
conditions set forth below;
NOW THEREFORE, in consideration of the premises herein contained, and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties hereto hereby
agree as follows:
1. Defined Terms. Capitalized terms used and not otherwise defined herein shall have
the meanings assigned to such terms in the RPA.
2. Limited Waiver.
(a) Subject to the terms and conditions set forth herein and in reliance on the
representations and warranties of the Flowserve Entities herein contained, the Agent and the
Purchasers hereby temporarily waive (i) compliance with the requirement (A) under Section
7.1(a)(i)(A) of the RPA that the financial statements of the Provider for the fiscal year ended
December 31, 2004 delivered pursuant to Section 7.1(a)(i)(A) of the RPA are audited and accompanied
by an opinion of PricewaterhouseCoopers LLP, (B) under Section 4.1(a)(i)(A) of the RSA that the
financial statements of the Provider for the fiscal year ended December 31, 2004 delivered pursuant
to Section 4.1(a)(i)(A) of the RSA are audited and accompanied by an opinion of
PricewaterhouseCoopers LLP and (C) under Section 7(a)(1) of the Performance Undertaking that the
financial statements for the fiscal year ended December 31, 2004 delivered pursuant to Section
7(a)(1) of the Performance Undertaking are audited and accompanied by an opinion of
PricewaterhouseCoopers LLP, (ii) any consequences or further affirmative obligations of any
Flowserve Entity under any Agreement resulting from such noncompliance, and (iii) any Amortization
Event, Potential Amortization Event, Termination Event or Potential Termination Event arising from
an event of default under any agreement or instrument evidencing or governing Material Indebtedness
of any Flowserve Entity or any of their respective Subsidiaries arising solely from the failure to
provide similar financial information (or opinions or certifications thereof) or annual or
quarterly public filings during or for the fiscal year ended December 31, 2004 or for the first
three fiscal quarters of the fiscal year ending December 31, 2005; in each case, during the period
from the date all the conditions precedent to this Amendment under Section 5 have been
satisfied through and including the earlier to occur of (a) the date of delivery of audited
financial statements for the fiscal year ended December 31, 2004 and accompanying independent
public accountant’s opinion in accordance with Section 7.1(a)(i)(A) of the RPA, Section
4.1(a)(i)(A) of the RSA and Section 7(a)(1) of the Performance Undertaking to the Agent, and (b)
December 31, 2005; provided, however, all waivers and accommodations made to the Flowserve
Entities in this Section 2(a) shall be rescinded and be null and void and of no force and
effect upon the commencement by any holder of Material Indebtedness of any Flowserve Entity or any
their respective Subsidiaries of any action exercising rights with respect to collateral or rights
to accelerate arising from any default or
event of default under any agreement or instrument evidencing or governing Material
Indebtedness any Flowserve Entity or any their respective Subsidiaries.
(b) The waivers set forth in Section 2(a) (the “Waiver”) shall be limited
precisely as written and relate solely to the noncompliance or temporary noncompliance, as the case
may be, by the Flowserve Entities with the provisions of the Agreements in the manner and to the
extent described above, and nothing in this Waiver shall be deemed to:
1. constitute a waiver of compliance by SPV with respect to (i) Section 7.1(a)(i)(A) of
the RPA in any other instance or (ii) any other term, provision or condition of the RPA or
any other Transaction Document;
2. constitute a waiver of compliance by Flowserve with respect to (i) Section
4.1(a)(i)(A) of the RSA in any other instance or (ii) any other term, provision or condition
of the RSA or any other Transaction Document;
3. constitute a waiver of compliance by the Provider with respect to (i) Section
7(a)(1) of the Performance Undertaking in any other instance or (ii) any other term,
provision or condition of the Performance Undertaking or any other Transaction Document; or
4. prejudice any right or remedy that SPV, the Agent or any Purchaser may now have
(except to the extent such right or remedy was based upon existing defaults that will not
exist after giving effect to this Waiver) or may have in the future under or in connection
with any Agreement or any other Transaction Document.
Except as expressly set forth herein, the terms, provisions and conditions of each Agreement
shall remain in full force and effect and in all other respects are hereby ratified and confirmed.
3. Amendment to the RPA. Subject to the satisfaction of the conditions precedent set
forth in Section 5 below, Exhibit I to the RPA is hereby amended to amend and restate the
definition of “Bank Credit Agreement” in its entirety as follows:
"Bank Credit Agreement” means that certain Credit Agreement dated as of August
12, 2005 by and among Flowserve Corporation, certain “Lenders” from time to time party
thereto and Bank of America, N.A., as “Swingline Lender” and Bank Group Agent, as the same
may from time to time be amended, restated, supplemented or otherwise modified.
4. Representations and Warranties. Each of SPV, Flowserve and the Provider
represents and warrants, as to itself only and not as to the others, that:
(a) The representations and warranties of the Flowserve Entities set forth in Agreements
(other than the representation and warranty of the Provider set forth in first sentence of Section
6(d) of the Performance Undertaking with respect to the June 30, 2004 financial statements of the
Provider and its consolidated Subsidiaries) are true, correct and complete on the date hereof as if
made on and as of the date hereof and there exists no Amortization Event, Potential Amortization
Event, Termination Event or Potential Termination Event on the date hereof, provided, that,
in the case of any representation or warranty in any Agreement that
expressly relates to facts in existence on an earlier date, the reaffirmation thereof under this
Section 4(a) shall be made as of such earlier date.
(b) The execution and delivery by SPV, Flowserve and the Provider of this Amendment has been
duly authorized by proper corporate proceedings of SPV, Flowserve and the Provider and each of this
Amendment and each Agreement, as amended by this Amendment, constitutes the legal, valid and
binding obligation of SPV, Flowserve and the Provider, as applicable, enforceable against such
Person in accordance with its terms, except as such enforcement may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws of general applicability
affecting the enforcement of creditors’ rights generally.
5. Conditions Precedent. This Amendment shall become effective as of the date first
written above upon the Agent’s receipt of each of the following:
(a) counterparts of this Amendment executed by SPV, the Provider, Flowserve and each
Purchaser; and
(b) counterparts of that certain Amendment No. 1 to Intercreditor Agreement dated as of the
date from each party hereto and the Bank Group Agent.
6. Ratification. Each Agreement (in the case of the RPA, as amended hereby) is hereby
ratified, approved and confirmed in all respects.
7. Reference to the Agreements. From and after the effective date hereof, each
reference any Agreement to “this Agreement”, “hereof”, or “hereunder” or words of like import, and
all references to such Agreement in any and all agreements, instruments, documents, notes,
certificates and other writings of every kind and nature shall be deemed to mean such Agreement.
8. Costs and Expenses. Each Flowserve Entity agrees to pay all reasonable costs, fees
and out-of-pocket expenses (including attorneys’ fees and time charges of attorneys representing
the Agent, which attorneys may be employees of the Agent) incurred by the Agent in connection with
the preparation, execution and enforcement of this Amendment.
9. CHOICE OF LAW. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF ILLINOIS.
10. Execution of Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall constitute one and
the same agreement.
11. Reaffirmation of Performance Undertaking. The Provider consents to the execution
by SPV and Flowserve of this Amendment, reaffirms all of its obligations under the Performance
Undertaking and acknowledges and agrees that, after giving effect to this Amendment, the
Performance Undertaking remains in full force and effect and is hereby ratified and confirmed.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and
delivered by their duly authorized officers as of the date first written above:
| FLOWSERVE RECEIVABLES CORPORATION |
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| By: | /s/ Xxxx X. Xxxxx | |||
| Name: | Xxxx X. Xxxxx | |||
| Title: | Vice President | |||
| FLOWSERVE US INC. |
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| By: | /s/ Xxxx X. Xxxxx | |||
| Name: | Xxxx X. Xxxxx | |||
| Title: | Vice President | |||
| FLOWSERVE CORPORATION |
||||
| By: | /s/ Xxxx X. Xxxxx | |||
| Name: | Xxxx X. Xxxxx | |||
| Title: | Vice President | |||
| JUPITER SECURITIZATION CORPORATION |
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| By: | /s/ Xxxxxxx X. Xxxx | |||
| Name: | Xxxxxxx X. Xxxx | |||
| Title: | Authorized Signatory | |||
| JPMORGAN CHASE BANK, N.A. (successor by merger to Bank One, NA (Main Office Chicago)), as a Financial Institution and as Agent |
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| By: | /s/ Xxxxxxx X. Xxxx | |||
| Name: | Xxxxxxx X. Xxxx | |||
| Title: | Authorized Signatory | |||
