Exhibit 10.2
FIRST AMENDMENT AND SECOND WAIVER TO POSTPETITION CREDIT
AGREEMENT
This FIRST AMENDMENT AND SECOND WAIVER, dated as of July 29, 2002 (this
"Agreement"), refers to that certain Postpetition Credit Agreement, dated as of
April 26, 2002 (as amended, supplemented or otherwise modified from time to
time, the "Credit Agreement"), among the financial institutions from time to
time party thereto (such financial institutions, together with their respective
successors and assigns, are referred to hereinafter each individually as a
"Lender" and collectively as the "Lenders"), CREDIT LYONNAIS NEW YORK BRANCH, as
a Lender, as Issuing Bank with respect to the Letters of Credit, and as agent
for the Lenders and the Issuing Bank thereunder (the "Agent"), SPECIAL METALS
CORPORATION, a Delaware corporation, in its capacity as a debtor and a debtor in
possession on behalf of the estate created upon the commencement of the
Bankruptcy Cases ("SMC"), A-1 WIRE TECH, INC., an Illinois corporation, in its
capacity as a debtor and a debtor in possession on behalf of the estate created
upon the commencement of the Bankruptcy Cases ("Wire"), SPECIAL METALS DOMESTIC
SALES CORPORATION, a Delaware corporation, in its capacity as a debtor and a
debtor in possession on behalf of the estate created upon the commencement of
the Bankruptcy Cases ("Sales"), and INCO ALLOYS INTERNATIONAL, INC. (d/b/a
Huntington Alloys), a Delaware corporation, in its capacity as a debtor and a
debtor in possession on behalf of the estate created upon the commencement of
the Bankruptcy Cases ("Alloys," and together with SMC, Wire and Sales, each a
"Borrower" and collectively, the "Borrowers"). Capitalized terms used and not
defined in this Agreement shall have the meanings given such terms in the Credit
Agreement.
RECITALS
A. WHEREAS, the Borrowers have requested that the Lenders agree,
subject to the conditions and upon the terms set forth in this Agreement, (i) to
amend subsections 8.15, 8.16(B) and 8.16(C) of the Credit Agreement and (ii) to
waive certain Defaults and/or Events of Default occurring under subsections
9.1(A) and 9.6(E) of the Credit Agreement; and
B. WHEREAS, the Lenders are willing to agree to such amendments and
waivers, subject to the conditions and on the terms set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the promises and the mutual agreements
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I
AMENDMENT AND WAIVER
SECTION 1.1. Amendment. Subject to the conditions and upon the terms
set forth in this Agreement and in reliance on the representations and
warranties of the Borrowers set forth in this Agreement, the Lenders hereby
agree that:
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(a) subsection 8.15 of the Credit Agreement is amended by (i) deleting the
words "August 1, 2002", appearing therein and inserting in lieu thereof the
words "September 12, 2002", (ii) deleting the sentence in subsection 8.15
reading "In addition, the Borrowers will provide the Agent with a certificate
from a "Big Five" accounting firm to the effect that the assumptions in the
Business Plan are reasonable and fair in light to the conditions then known and
that the methodologies used in the Business Plan are correct.", and (iii)
deleting the words ", and will cause such accounting firm to," from the last
sentence of subsection 8.15;
(b) subsection 8.16(B) of the Credit Agreement is amended by (i) deleting
the words "August 1, 2002" appearing therein and inserting in lieu thereof the
words "September 12, 2002"; (ii) deleting the words "September 15, 2002"
appearing therein and inserting in lieu thereof the words "October 18, 2002";
and (iii) deleting the words "November 1, 2002" appearing therein and inserting
in lieu thereof the words "November 27, 2002"; and
(c) subsection 8.16(C) of the Credit Agreement is amended by deleting the
words "January 1, 2003" appearing therein and inserting in lieu thereof the
words "January 17, 2003".
SECTION 1.2. Waiver. Subject to the conditions and upon the terms set
forth in this Agreement and in reliance on the representations and warranties of
the Borrowers set forth in this Agreement, the Lenders hereby waive the
following:
(a) compliance by Borrowers with the requirements of subsection 9.1(A) of
the Credit Agreement, only insofar as it requires the Consolidated Revenue of
SMC for the period beginning on April 1, 2002 and ending on June 30, 2002 to be
not less than $143,068,000;
(b) compliance by the Borrowers with the requirements of subsection 9.1(A)
of the Credit Agreement, only insofar as it requires the Consolidated Revenue of
SMC for the period beginning on April 1, 2002 and ending on July 31, 2002 to be
not less than $189,877,000; and
(c) compliance by the Borrowers with the requirements of subsection 9.6(E)
of the Credit Agreement, only with respect to the sale of the property located
at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (the
"Property"); provided that such waiver shall be effective only insofar as the
Borrowers use the proceeds from the sale of such Property immediately to repay
Prepetition Indebtedness consistently with the terms of subsection 5.1(b) of the
Credit Agreement.
ARTICLE II
CONDITIONS PRECEDENT
The effectiveness of this Agreement shall be subject to the satisfaction of each
of the following conditions precedent:
SECTION 2.1. Execution. Each of the Agent and the Required Lenders shall
have executed this Agreement and the Borrowers shall have delivered to the Agent
duly executed counterparts of this Agreement.
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SECTION 2.2. Approval of the Bankruptcy Court. The Borrowers shall have
delivered to the Agent a true and correct copy of the final order entered by the
Bankruptcy Court approving the payment of the Applicable Fee (as defined below)
by the Borrowers to the Agent on behalf of the Lenders.
SECTION 2.3. Fee. The Borrowers shall have paid to the Agent an amendment
and waiver fee (the "Applicable Fee") equal to 0.125% applied to sum of the
aggregate (a) outstanding Revolving Credit Loans, plus (b) Letters of Credit
Outstanding, plus (c) Unused Revolving Credit Commitments of each Lender that
delivers to the Agent, by hand delivery or facsimile no later than 5:00 p.m.,
New York City time, on July 29, 2002, a counterpart of this Agreement executed
by such Lender. Such fee (i) shall be received by the Agent ratably for account
of, and shall be remitted by the Agent solely to, such Lenders and (ii) shall be
fully earned and nonrefundable when paid.
SECTION 2.4. Representations and Warranties. Each Borrower shall have
confirmed to the Agent, by the signature of a Responsible Officer of such
Borrower below, that on and as of the date of this Agreement:
(a) each of the representations and warranties made by the Borrowers or
their Subsidiaries in or pursuant to the Loan Documents is true and
correct in all material respects (except that any such representation or
warranty that is expressly stated as being made only as of a specified
earlier date shall be true and correct in all material respects as of such
earlier date);
(b) other than the Defaults and/or Events of Default that are the subject
of this Agreement, no Default or Event of Default has occurred and is
continuing; and
(c) none of the Bankruptcy Cases has been dismissed or converted to a case
under Chapter 7 of the Bankruptcy Code, no Person has filed an application
for an order dismissing any Borrower's Bankruptcy Case or converting any
Borrower's Bankruptcy Case to a case under Chapter 7 of the Bankruptcy
Code, and no trustee under Chapter 7 or Chapter 11 of the Bankruptcy Code
or responsible officer or examiner with powers beyond the duty to
investigate and report, as set forth in Sections 1106(a)(3) and (4) of the
Bankruptcy Code has been appointed in any of the Bankruptcy Cases. No
application has been filed by any Borrower for the approval of any other
superpriority administrative claim in any Bankruptcy Case which is pari
passu with or senior to the claims of the Agent and/or any Lender against
the Borrowers (and, other than the Carve-Out, no such claim or lien has
arisen) and the Final Order is in full force and effect and has not been
stayed, modified, amended, reversed, rescinded or vacated.
ARTICLE III
MISCELLANEOUS
SECTION 3.1. Execution of this Agreement. This Agreement is executed and
shall be construed as the First Amendment and Second Waiver to the Postpetition
Credit Agreement, and, as provided in the Credit Agreement, this Agreement forms
a part thereof and is a Loan Document.
SECTION 3.2. Waiver. This Agreement shall not constitute an amendment or
waiver of, or consent to any provision of, the Credit Agreement or any other
Loan Document not
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expressly referred to herein and shall not be construed as an amendment, waiver
or consent to any action on the part of the Borrowers that would require an
amendment, waiver or consent of the Agent or the Lenders except as expressly
stated herein. The execution, delivery and performance by the parties hereto of
this Agreement shall not constitute a waiver, forbearance or other indulgence
with respect to any Default or Event of Default now existing or hereafter
arising, except as expressly set forth herein. Except as specifically modified
pursuant to the terms of this Agreement, the terms and conditions of the Credit
Agreement and the other Loan Documents remain in full force and effect. Nothing
herein shall limit in any way the rights and remedies of the Agent and the
Lenders under the Credit Agreement and the other Loan Documents.
SECTION 3.3. Counterparts; Integration; Effectiveness. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement
constitutes the entire contract among the parties hereto relating to the subject
matter hereof and supersedes any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Upon the effectiveness
of this Agreement as set forth in Article II hereof, this Agreement shall be
binding upon and inure to the benefit of the parties hereto and, subject to and
in accordance with Section 12.6 of the Credit Agreement, their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by facsimile shall be as effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 3.4. Ratification. Subject to the amendments and waivers
provided hereby, the Loan Documents shall continue to be in full force and
effect and are hereby in all respects ratified and confirmed.
SECTION 3.5. Severability. Any provision of this Agreement held to
be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 3.6. Expenses. The Borrowers agree to pay or reimburse the
Agent for all of its reasonable out-of-pocket costs and expenses incurred in
connection with this Agreement, any other documents prepared in connection
herewith and the transactions contemplated hereby, including, without
limitation, the reasonable fees and disbursements of counsel to the Agent.
SECTION 3.7. Governing Law. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAW OF THE STATE OF
NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PROVISIONS THEREOF THAT
WOULD DIRECT THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION, ALL TO THE
EXTENT NOT PREEMPTED BY THE FEDERAL BANKRUPTCY LAWS OF THE UNITED STATES;
PROVIDED, THAT THE LENDERS AND AGENT SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.
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SECTION 3.8. Headings. Article and section headings used herein are
for convenience of reference only, are not part of this Agreement and shall not
affect the construction of, or be taken into consideration in interpreting, this
Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.
SPECIAL METALS CORPORATION,
a Delaware corporation, as debtor and
debtor in possession on behalf of the
estate created upon the commencement of
the Bankruptcy Cases
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title: Vice President
-----------------------------------
A-1 WIRE TECH, INC.,
an Illinois corporation, as debtor and
debtor in possession on behalf of the
estate created upon the commencement of
the Bankruptcy Cases
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title: Vice President of SMC
-----------------------------------
SPECIAL METALS DOMESTIC SALES CORPORATION,
a Delaware corporation, as debtor and
debtor in possession on behalf of the
estate created upon the commencement of
the Bankruptcy Cases
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title: Vice President of SMC
-----------------------------------
INCO ALLOYS INTERNATIONAL, INC.
(D/B/A HUNTINGTON ALLOYS),
a Delaware corporation, as debtor and
debtor in possession on behalf of the
estate created upon the commencement of
the Bankruptcy Cases
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title: Vice President
-----------------------------------
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CREDIT LYONNAIS NEW YORK BRANCH,
as Agent, as a Lender and as Issuing
Bank
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
------------------------------------------
Name ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇:
------------------------------------
Title: Vice President
-----------------------------------
MANUFACTURERS AND TRADERS TRUST COMPANY,
as Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title: Director
-----------------------------------
THE BANK OF NOVA SCOTIA,
as Lender
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Title: Director
-----------------------------------
GENERAL ELECTRIC CAPITAL CORPORATION,
as Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇
------------------------------------
Title: Duly Authorized Signatory
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