FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT (this "Amendment") to the Credit Agreement dated
as of July 30, 1998 (as amended, supplemented or otherwise modified from time to
time, the "Credit Agreement"; capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Credit
Agreement) among SPINNAKER ELECTRICAL TAPE COMPANY, a Delaware corporation (the
"Borrower"), EACH OF THE FINANCIAL INSTITUTIONS FROM TIME TO TIME PARTIES
THERETO (each, a "Lender" and collectively, the "Lenders"), and TRANSAMERICA
BUSINESS CREDIT CORPORATION, as agent (in such capacity, the "Agent") for the
Lenders, is made as of March 31, 1999 between the Borrower and the Lenders.
W I T N E S S E T H :
WHEREAS, the Borrower has requested that the Lenders amend certain
provision of the Credit Agreement as set forth herein; and
WHEREAS, the Lenders are willing to agree to the requested amendments,
but only on the terms and subject to the conditions set forth herein.
NOW THEREFORE, the Borrower and the Lenders hereby agree as follows:
SECTION 1. AMENDMENTS TO THE CREDIT AGREEMENT. Effective as of the
date hereof, and subject to the satisfaction of the conditions to effectiveness
set forth in Section 2, the Credit Agreement is hereby amended as follows:
(a) Section 7.2(t) is amended by deleting "450,000" and
substituting therefor "200,000".
(b) Section 7.2(u) is amended and restated as follows:
"(u) MINIMUM CONSOLIDATED FIXED CHARGE COVERAGE RATIO. The
Borrower will not permit Consolidated Fixed Charge Coverage Ratio to
be less than (i) 1.0:1.0 with respect to the month of December 1998;
(ii) 1.0:1.0 with respect to each year to date period commencing
January 1, 1999 and ending on the last day of each month (excluding
the months of April and May) through December 31, 1999; (iii) .65:1.0
with respect to the period commencing January 1, 1999 and ending on
April 30, 1999; (iv) .10:1.00 with respect to the period commencing
January 1, 1999 and ending on May 31, 1999; and (v) 1.0:1.0 with
respect to each consecutive four-quarter period commencing with the
fiscal quarter ending March 31, 2000."
SECTION 2. CONDITIONS TO EFFECTIVENESS. This Amendment shall become
effective when the Agent shall have received a counterpart of this Amendment,
duly executed by the Borrower and the Majority Lenders.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE BORROWER. The
Borrower represents and warrants as follows:
(a) The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and such
other jurisdictions where it presently is, or proposes to be, engaged in
business except for such other jurisdictions in which the failure to be in good
standing could not be reasonably expected to have a Material Adverse Effect.
(b) The execution, delivery and performance by the Borrower of
this Amendment (i) are within the Borrower's corporate powers, have been duly
authorized by all necessary corporate action and do not contravene, violate or
constitute a default under (A) the Governing Documents of the Borrower or
(B) any other Requirement of Law binding on or affecting the Borrower or its
property, and (ii) will not result in or require the creation or imposition of
any Lien of any nature upon or with respect to any property now owned or
hereafter acquired by the Borrower.
(c) No authorization, approval or other action by, and no notice
to or filing with, any Governmental Authority is required for the due
execution, delivery and performance by the Borrower of this Amendment.
(d) This Amendment constitutes the legal, valid and binding
obligation of the Borrower enforceable against the Borrower in accordance with
its terms, except as enforceability may be limited by (i) bankruptcy, insolvency
or similar laws affecting creditors' rights generally and (ii) general
principles
-2-
of equity.
(e) All consents, filings and approvals required in connection
with the execution, delivery and performance by the Borrower of this Amendment
have been obtained or made and are in full force and effect.
(f) There is no pending or, to the best of the Borrower's
knowledge, threatened action or proceeding affecting the Borrower before any
court, arbitrator or Governmental Authority which (i) purports to affect the
legality, validity of enforceability of this Amendment or (ii) could
individually or in the aggregate be reasonably expected to have a Material
Adverse Effect.
(g) After giving effect to this Amendment, no Event of Default
has occurred and is continuing.
SECTION 4. REFERENCE TO AND EFFECT ON THE CREDIT DOCUMENTS.
(a) Upon the effectiveness of this Amendment, on and after the
date hereof, each reference in the Credit Agreement to "this Agreement,"
"hereunder," "hereof," "herein" and words of like import, and each reference in
the other Credit Documents to the Credit Agreement shall mean and be a reference
to the Credit Agreement as amended hereby.
(b) Except as specifically amended herein, the Credit Agreement
and the other Credit Documents shall remain in full force and effect and are
hereby ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver or amendment
of any right, power or remedy of the Agent or Lenders under any of the Credit
Documents, or constitute a waiver or amendment of any provision of any of the
Credit Documents.
(d) This Amendment shall constitute a Credit Document.
SECTION 5. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay
the Agent on demand, for all of the costs and expenses incurred by the Agent in
connection with this Amendment, including, without limitation, the reasonable
fees and expenses of counsel to the Agent.
-3-
SECTION 6. EXECUTION IN COUNTERPARTS, ETC. This Amendment may be
executed in counterparts, each of which when so executed and delivered shall be
deemed to be an original, and both of which taken together shall constitute one
and the same instrument. This Amendment may be executed and delivered by
telecopier with the same force and effect as if the same were a fully executed
and delivered manual counterpart.
SECTION 7. GOVERNING LAW. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York without giving
effect to the conflicts of law principles thereof.
-4-
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed by their respective duly authorized officers as of the date first
above written.
TRANSAMERICA BUSINESS CREDIT
CORPORATION
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
SPINNAKER ELECTRICAL TAPE COMPANY
By: /s/ Xxxx Xxxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxxx
Title: Vice President
-5-
