CREDIT AGREEMENT
between
Xxxxxxxxx XX
(hereinafter referred to as [Borrower] or [Schaublin]),
and
CREDIT SUISSE
(hereinafter referred to as the [Bank] or the [Lender])
December 8, 2003
TABLE OF CONTENTS
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1. FACILITY.................................................................4
1.1. TYPE OF CREDIT FACILITIES...........................................4
1.2. AMOUNTS AND COMMITMENTS.............................................4
1.3. AVAILABILITY........................................................4
1.4. PURPOSE.............................................................4
1.5. COMMITMENT PERIODS..................................................4
1.6. DRAWDOWN............................................................5
1.7. COLLATERAL/SECURITY.................................................5
2. ADVANCES.................................................................5
2.1. UTILIZATION.........................................................5
2.2. NOTICE TO THE BANK..................................................6
2.3. MAXIMUM NUMBER OF ADVANCES..........................................6
2.4. MAXIMUM OUTSTANDING.................................................6
3. INTEREST AND COMMISSIONS.................................................6
3.1. PAYMENT.............................................................6
3.2. RATE AND CALCULATION ADVANCES.......................................6
3.3. MARGIN..............................................................7
3.4. RATE AND CALCULATION CURRENT ACCOUNT................................7
3.5. COMMISSION..........................................................8
3.6. DEFAULT RATE........................................................8
4. REPAYMENT, REDUCTION & cancellation......................................8
4.1. REPAYMENT...........................................................8
4.2. CANCELLATION OF AMOUNTS AVAILABLE...................................8
4.3. REDUCTION...........................................................8
4.4. FINAL REPAYMENT.....................................................9
4.5. CANCELLATION........................................................9
4.6. PREPAYMENT AND CANCELLATION........................................10
5. PAYMENT AND TAXES.......................................................10
5.1. MANNER OF PAYMENT..................................................10
5.2. TAXATION OF THE BANK, ETC..........................................10
5.3. BUSINESS DAYS......................................................11
5.4. PARTIAL PAYMENT....................................................11
6. CHANGES IN CIRCUMSTANCES................................................11
6.1. INCREASED COSTS....................................................11
6.2. ESCAPE CLAUSE......................................................11
6.3. RESTRICTION CLAUSE.................................................11
6.4. ILLEGALITY.........................................................12
7. UNDERTAKINGS, COVENANTS ETC.............................................12
7.1. GENERAL UNDERTAKINGS...............................................12
7.2. REPRESENTATIONS AND WARRANTIES.....................................13
7.3. SPECIFIC UNDERTAKINGS..............................................13
7.4. FINANCIAL COVENANTS................................................14
7.5. OTHER COVENANTS....................................................16
8. SHAREHOLDER LOAN........................................................17
9. EVENTS OF DEFAULT.......................................................17
9.1. EVENTS.............................................................17
9.2. CONSEQUENCES.......................................................19
10. SET-OFF..............................................................19
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 2
10.1. SET-OFF............................................................19
10.2. CURRENCY CONVERSION................................................19
11. INDEMNITIES..........................................................19
11.1. GENERAL INDEMNITY..................................................19
11.2. CURRENCY INDEMNITY.................................................20
12. FEES AND EXPENSES....................................................20
12.1. STRUCTURING FEE....................................................20
12.2. EXPENSES...........................................................20
12.3. VALUE ADDED TAX....................................................20
13. ASSIGNMENT, TRANSFER AND LENDING OFFICES.............................20
13.1. NO ASSIGNMENT BY THE BORROWER......................................20
13.2. ASSIGNMENT AND TRANSFER BY THE BANK................................20
14. NOTIFICATION.........................................................21
14.1. BY THE BANK........................................................21
14.2. BY THE BORROWER....................................................21
14.3. OBJECTIONS.........................................................22
15. GOVERNING LAW AND JURISDICTION.......................................22
16. MISCELLANEOUS........................................................22
16.1. CONFIDENTIALITY....................................................22
16.2. NO WAIVER..........................................................22
16.3. SEVERABILITY.......................................................23
16.4. INTERPRETATION.....................................................23
16.5. ORIGINALS..........................................................23
SPECIAL DEED OF PLEDGE........................................................29
ANNEX A..CONDITIONS PRECEDENT
ANNEX B..FIXED TERM ADVANCE REQUEST
ANNEX C..COMPLIANCE CERTIFICATE
ANNEX D..GENERAL CONDITIONS
ANNEX E..FORM "SPECIAL DEED OF PLEDGE"
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 3
Whereas the Borrower has requested the Bank for credit facilities
(hereafter referred to as [Facilities]); and
whereas the Bank is prepared to grant such Facilities to the Borrower
under certain terms and conditions, therefore the parties agree as follows:
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1. FACILITY
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1.1. TYPE OF CREDIT FACILITIES
The Bank has agreed to make the following credit facilities (the [Facilities])
available to the Borrower on the terms of this Agreement up to the maximum
amount specified under Clause 1.2..
1.2. AMOUNTS AND COMMITMENTS
The Bank has agreed to make available to the Borrower credit facilities
("Facilities") in an aggregate amount not to exceed CHF 12,000,000.00 (Swiss
Francs twelve million and o/oo), divided in two sub-facilities as defined
hereafter:
Facility A: CHF 10,000,000.00 (Swiss Francs ten million and o/oo)
Facility B: CHF 2,000,000.00 (Swiss Francs two million and o/oo)
1.3. AVAILABILITY
During the Commitment Periods, the Borrower may borrow under the Facilities once
the Lender has received and is satisfied with any and all items listed in the
Annex A hereto.
1.4. PURPOSE
The Facilities are available for the following:
Facility A: CHF 10,000,000.00 (Swiss francs ten million and o/oo)
to refinance existing shareholder loans from
Schaublin Holding SA. Facility A is a result of the
acquisition of the borrower by RBC and the
acquisition of myonic SAS, Les Utils (F),
subsequently renamed RBC France SAS ("RBCF").
Facility B: CHF 2,000,000.00 (Swiss francs two million and o/oo)
to finance general working capital and corporate
purposes of Xxxxxxxxx XX.
1.5. COMMITMENT PERIODS
The Facilities expiry dates will be the Final Repayment Dates (termination
dates) specified in Clause 4.4..
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 4
1.6. DRAWDOWN
Shall be carried out by notification to the Bank by the Borrower pursuant to
Clause 2.2.. The Bank may, but is not obliged to accept simplified drawdown
procedures for Facility B, i.e. Fixed Term Advance Requests in a different form
than specified under Annex B.
1.7. COLLATERAL/SECURITY
Facility A & B: The following collateral/security shall be pledged
and assigned to the Bank in order to secure Facility
A until all liabilities under Facility A have been
discharged and no commitment under Facility A is
outstanding:
According to separate form "Special Deed of Pledge", Schaublin Holding
SA will pledge and assign to the Bank 99.4% (1366 shares) of the
present and future share capital of Schaublin. Schaublin Holding SA is
a wholly-owned (100.0% of share capital) subsidiary of RBC.
The pledged shares have to be transferred to and deposited with the
Bank. In addition, Schaublin will provide the Bank with a resolution of
the Board of Directors to accept any inscription of a shareholder,
without any restriction, as designated by the Bank. This last
requirement does not apply to the qualification shares
("Qualifikationsaktien").
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2. ADVANCES
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2.1. UTILIZATION
The Facilities shall be available:
Facility A: in the form of fixed term advances (hereafter
collectively referred to as [Advances] and
individually [Advance]) for periods of one month up
to twelve months, not to exceed the Final Repayment
Date A. Facility A may be drawn in minimum amounts of
CHF 500,000.00. The Bank may from time to time grant
exceptions to the periods of availability upon the
Borrower's request;
Facility B: in the form of fixed term advances (hereafter
collectively referred to as [Advances] and
individually [Advance]) for periods of one month up
to twelve months, not to exceed the Final Repayment
Date B. Facility B may be drawn in minimum amounts of
CHF 250,000.00 or their equivalent U.S. Dollars,
Euros or Yen; and
in the form of current account(s) and/or in the form
of bank guarantees, performance bonds, letters of
credit and currency transactions.
The interest rate shall be determined separately for each Advance.
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 5
2.2. NOTICE TO THE BANK
The Bank`s decision to make an Advance shall further be subject to the condition
precedent that the Bank shall have received a Fixed Term Advance Request, as
defined in Annex B, at the latest by 12.00 a.m. Delemont time, three Business
Days prior to the date of such borrowing, specifying (i) the currency, (ii) the
term of the Advance, and (iii) unless previously supplied, details of an account
to which the Borrower wishes the payments in the currency specified to be made.
[Business Day] means a day on which the banks are open in Delemont.
2.3. MAXIMUM NUMBER OF ADVANCES
Under facility A no more than 10 Advances altogether may be outstanding.
2.4. MAXIMUM OUTSTANDING
The aggregate amount of the Advances requested and drawn by the Borrower under
Facility A may not exceed the amount determined by the Bank for Facility A,
respectively, as specified in clause 1.2. above.
The aggregate amount of the Advances requested and drawn by the Borrower under
Facility B, plus the aggregate outstanding under current account(s), bank
guarantees, performance bonds and letters of credit under Facility B, as
available, may not exceed the maximum amount determined by the Bank for Facility
B as specified in clause 1.2. above.
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3. INTEREST AND COMMISSIONS
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3.1. PAYMENT
The Borrower shall pay interest accrued on each Advance in accordance with the
provisions of Clause 3.2., Clause 3.3. and Clause 3.6..
The Borrower shall pay interest for current account(s) under Facility B in
accordance with the provisions of Clause 3.4. and Clause 3.6.. In addition,
Schaublin shall pay a Commission on the outstanding amount of each guarantee,
performance bond and letter of credit issued under Facility B in accordance with
the provisions of Clause 3.5. and Clause 3.6..
3.2. RATE AND CALCULATION ADVANCES
The interest rate applicable, per annum, to each Advance under the Facilities
will be the London Interbank Offered Rate ([LIBOR]), for the relevant term and
currency, plus a Margin as defined in Clause 3.3..
[LIBOR] is defined, in respect of any Advance or unpaid sum, as the annual
percentage rate displayed on Telerate page 3750 or 3740 at or about 11 a.m.
(London time) two Business Days prior to any drawdown or renewal of such
Advances, or, if unavailable, the rate determined by the Bank to be the rate
which would have been offered to the Bank by prime banks in the London interbank
market on the quotation date for deposits of a comparable amount to that Advance
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 6
or other sum, in the same currency and for a period comparable to its term,
rounded to the next 1/16 of a percent. Any and all interest and fees shall
accrue from day to day and shall be calculated on the basis of a year of 360
days and the actual number of days. For any Advance with a maturity in excess of
twelve months, LIBOR shall be replaced by the Swap Rate. The [Swap Rate] is
defined, in respect of any Advance or unpaid sum, as the annual percentage rate
determined by the Bank on the date such term starts to be the rate which would
have been offered to the Bank by prime banks on the quotation date for deposits
of a comparable amount to that Advance or other sum, in the same currency and
for a period comparable to its term.
For Advances with a maturity of up to six months, the Borrower shall pay
interest accrued on each Advance on the date of maturity of such Advance. For
Advances with a maturity in excess of six months, the Borrower shall pay
interest at the end of each calendar quarter and on the date of maturity of such
Advance.
3.3. MARGIN
Facility A: The applicable interest Margin on Advances drawn
under Facility A depends on the Debt Capacity Ratio.
The [Debt Capacity Ratio] is defined as senior bank
debt divided by earnings before interests, taxes,
depreciation and amortization ([EBITDA]) and is
calculated on a consolidated basis, i.e. for
Schaublin and all its subsidiaries. In the context of
[Debt Capacity Ratio] the Senior Bank Debt is being
defined as the amount due to the Bank as of the end
of the measuring period, after giving effect to the
principal payment due on such date.
Until receipt of the annual audited consolidated
accounts of Schaublin as of March 31, 2004, the
applicable interest margin shall be 2.25%.
Thereafter, the applicable interest Margin shall be
adjusted for all drawings on an annual basis as of
July 1 of the respective year, based upon the annual
audited consolidated accounts of Schaublin, according
to the following pricing grid:
Debt Capacity Ratio: Margin:
> 2.75x 4.50%
> 2.50x and <= 2.75x 2.50%
> 2.25x and <= 2.50x 2.25%
> 1.75x and <= 2.25x 2.00%
> 1.25x and <= 1.75x 1.75%
> 1.00x and <= 1.25x 1.50%
<= 1.00x 1.25%
3.4. RATE AND CALCULATION CURRENT ACCOUNT
Schaublin shall pay to the Bank at the end of each calendar quarter and pro rata
on the Final Repayment Date interest on the amount outstanding on current
account(s) under Facility B, increased by a quarterly utilization fee of 0.25%,
calculated on the highest used amount during that period. For utilizations in
Swiss Francs, the current account interest rate shall be 5.55% per annum. For
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 7
utilizations in other currencies, the respective interest rate offered by the
bank will be applied.
The Bank has the right to adjust the current account interest rate at any time
according to prevailing market conditions and according to the financial
performance of the Borrower and/or the assigned credit rating of the Borrower by
the Bank, without notice period and at its sole discretion. Such change shall
only occur in case the Bank changes the rate on current account credit limits
applicable to borrowers similarily situated to the Borrower or if the Bank
adapts its internal rating.
3.5. COMMISSION
At the end of each calendar quarter and pro rata on the Final Repayment Date,
Schaublin shall pay to the Bank a Commission at a rate equal to the applicable
Margin per annum of Facility B on the outstanding amount of each guarantee,
performance bond and letter of credit issued under Facility B, whereby the
Commission shall be calculated on the basis of the actual number of days elapsed
and a year of 360 days.
3.6. DEFAULT RATE
If a Default, as defined in clause 9.1., has occurred and as long as such a
Default lasts, the applicable interest rate on Advances and on current
account(s), as well as the applicable Commission on the outstanding amount of
each guarantee, performance bond and letter of credit issued under Facility B,
will be increased by 2.00% per annum.
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4. REPAYMENT, REDUCTION & CANCELLATION
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4.1. REPAYMENT
The Borrower shall repay each Advance, in the same currency as the one in which
the Advance was disbursed and on the account to be designated by the Bank, from
time to time, on its maturity date, together with the interest accrued thereon.
4.2. CANCELLATION OF AMOUNTS AVAILABLE
Any amount not drawn under Facility A (the unused portion) 45 days after the
signing of this Agreement will be deemed to be cancelled. Any amount so
cancelled shall permanently reduce the amount available under Facility A.
4.3. REDUCTION
The following reductions of Facility A are mandatory and such reductions shall
permanently reduce the amount available under Facility A.
Date: Reduction in CHF:
----- -----------------
March 31, 2004 500,000.00
September 30, 2004 1,000,000.00
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 8
March 31, 2005 1,000,000.00
September 30, 2005 1,250,000.00
March 31, 2006 1,250,000.00
September 30, 2006 1,000,000.00
March 31, 2007 1,000,000.00
September 30, 2007 1,000,000.00
March 31, 2008 750,000.00
September 30, 2008 750,000.00
March 31, 2009 500,000.00
4.4. FINAL REPAYMENT
Facility A: Schaublin shall repay in full all Advances (principal
and accrued interest including fees and similar
expenses or remuneration) under Facility A on March
31, 2009 ("Final Repayment Date A"), if a Business
Day as defined under 2.2., otherwise according to
clause 5.3.. The Bank`s commitment for Facility A
shall automatically terminate on the close of
business of the Final Repayment Date X. Xxxxxxxxx may
not borrow any Advance should the last day of its
term fall after that date.
Facility B: Schaublin shall repay in full all amounts outstanding
under current accounts (principal and accrued
interest including fees and similar expenses or
remuneration) under Facility B on March 31, 2009
("Final Repayment Date B"), if a Business Day as
defined under 2.2., otherwise according to clause
5.3. . The Bank`s commitment for Facility B shall
automatically terminate on the close of business of
the Final Repayment Date X. Xxxxxxxxx may not borrow
any Advance should the last day of its term fall
after that date. Any guarantee, performance bond and
letter of credit issued under this Agreement and
outstanding on the Final Repayment Date B shall be
cash collateralized as of the Final Repayment Date B.
4.5. CANCELLATION
Facility A: On the giving of thirty days prior written notice to
the Bank, Cancellation of Facility A will be
permitted in minimum amounts of CHF 500,000.00 and
integral multiples thereof. Any amount so cancelled
shall permanently reduce the amount available under
Facility A. Any notice of intended Cancellation shall
be irrevocable.
Facility B: Facility B and current accounts can be cancelled
mutually at any time with immediate effect. Advances
already granted under Facility B and any guarantee,
performance bond and letter of credit issued under
Facility B will remain unaffected by a Cancellation
of Facility B until their maturity as restricted
under Clause 2.1. and 4.4.. Furthermore, the
Cancellation of an Advance or a current account
granted under Facility B will not automatically
result in the termination of Facility B as a whole.
Any notice of intended Cancellation shall be
irrevocable.
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 9
4.6. PREPAYMENT AND CANCELLATION
If the Borrower is required to make any payment to the Bank under Clause 5.2.
(Taxation of the Bank, etc.) or under Clause 6. (Changes in Circumstances), it
may prepay all or any one of the Advances to which the provisions of these
clauses apply by giving the Bank an irrevocable notice of prepayment and
cancellation and the Borrower will prepay the Advances ten (10) Business Days
after such notice is given. The unused portion of the commitment will be deemed
to be cancelled on the date of receipt of such notice by the Bank.
The outstanding amounts shall be repaid without penalty, subject to payment to
the Bank of the difference, if negative, if any, of:
(a) the amount of interest which the Bank is able to obtain by
placing an amount equal to the amount prepaid on deposit with
prime banks in the relevant interbank market for the remainder
of relevant interest period, as soon as reasonably practicable
after receipt thereof from the Borrower, less
(b) the amount of interest which would otherwise be payable to the
Bank on the relevant amount received for the remainder of the
relevant interest period (less the margin).
The certificate of the Bank setting out the amount shall, in the absence of a
manifest error, be prima facie evidence thereof.
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5. PAYMENT AND TAXES
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5.1. MANNER OF PAYMENT
Each payment to be made by the Borrower must be:
(a) remitted to any account which the Bank specifies;
(b) made for value on the due date, in the currency in which it is
stated to be payable;
(c) freely disposable outside of bilateral or multilateral payment
agreements which may exist at the time of payment, free and
clear of any and all present and future taxes, levies,
imposts, duties, deductions, withholdings, fees, liabilities
and similar charges, now or hereafter imposed by or on behalf
of any taxing authority.
If deduction of any such taxes shall at any time during the
continuance of the Facilities be required by or under the
authority of any government, the Borrower shall pay such
amount in respect of principal and interest as may be
necessary in order that the amounts effectively received by
the Bank after such deduction shall be equal to the respective
amount of principal and interest which would have been paid to
the Bank if no such deduction had been made.
5.2. TAXATION OF THE BANK, ETC.
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 10
If the Bank is required to make any payment on account of tax (other than tax
imposed on the net income of its lending office by the jurisdiction in which it
is incorporated or in which its lending office is located) in respect of any sum
received or receivable by it under this Agreement, or if any liability in
respect of any such payment is asserted, imposed, levied or assessed against the
Bank, the Borrower shall on the Bank`s demand, pay the Bank an amount equal to
the amount which the Bank is required to pay, together with any interest,
penalties and expenses payable or incurred in connection with it.
5.3. BUSINESS DAYS
If any payment under this Agreement becomes due on a day which is not a Business
Day, the due date for that payment will be extended to the next day which is a
Business Day, unless such Business Day shall fall in the following calendar
month, in which event the due date will be the immediately preceding Business
Day.
5.4. PARTIAL PAYMENT
If at any time the Bank receives a smaller payment than the amount of any
payment due, it may apply the amount effectively received in or towards
discharge of the Borrower`s liabilities in any order selected by the Bank under
the respective Facility for which the payment has been made.
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6. CHANGES IN CIRCUMSTANCES
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6.1. INCREASED COSTS
If the result of any change in any law, regulation or official directive
(whether or not having the force of law), or in the interpretation or
application thereof, or compliance by the Bank with any request or directive of
any applicable monetary or fiscal agent or authority or banking authority
(whether or not having the force of law) is to increase the cost (including an
increase of costs resulting from an adverse change in the calculation basis of
the Bank's own fund requirements) of the Bank of maintaining or funding any
Advance or is to reduce the amount of principal or interest receivable, then
upon demand by the Bank, the Borrower shall pay to the Bank such amount as shall
compensate the Bank for such additional cost or reduction.
6.2. ESCAPE CLAUSE
In case the Bank should not be able to grant or renew Advances in the currency
requested by the Borrower owing to any present or future currency restrictions
or similar circumstances (i.e. initiated by Central Banks, Governments or any
other public authority or body) the Bank reserves the right to advance another
freely available currency at that date. The Bank's opinion as to whether a
currency is available or not shall be conclusive and binding on the Borrower,
except in case of manifest error.
6.3. RESTRICTION CLAUSE
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 11
Should the Swiss National Bank or any other government body or authority impose
restrictions of any kind or nature on the Bank affecting the Facilities, the
Bank shall have the right to request that the conditions of the present
Facilities be renegotiated by sending without delay written notice to the
Borrower.
Should no consent be reached following a negotiation period of thirty (30) days,
the Borrower and the Bank shall have the right to cancel the Facilities with
immediate effect and without having to pay any penalty, whereby any and all
amounts owed by the Borrower to the Bank shall immediately become due for
repayment.
6.4. ILLEGALITY
The Bank will notify the Borrower if it reasonably believes that it is, or will
be, acting illegally or contrary to any applicable rules and regulations in
relation to the Facilities ([Notice of Illegality]), specifying the reason
therefore. The Bank shall thereupon use its best efforts to transfer and/or
assign its rights under these Facilities to another bank not affected by such
illegality or violation of rules and regulations. If the Bank notifies the
Borrower in writing within twenty (20) Business Days after dispatching a copy of
the aforementioned Notice of Illegality to the Borrower, the commitment of the
Bank under this Agreement will thereupon terminate. For the transfer and/or the
assignment of the Bank's rights and/or obligations and to prepare such a
transfer or assignment of the bank's rights and/or obligations, the Borrower
releases the Bank from the obligation to observe banking secrecy. If the Bank so
requires, the Borrower will prepay any Advance which is affected by any such
illegality or violation on the date specified by the Lender in the notice.
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7. UNDERTAKINGS, COVENANTS ETC.
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7.1. GENERAL UNDERTAKINGS
The Borrower agrees that until all of its liabilities under this Agreement have
been discharged and as long as any commitment is outstanding:
(a) Default: the Borrower shall notify the Bank immediately if any
Event of Default or any potential Event of Default occurs or
may reasonably be expected to occur;
(b) Information: the Borrower shall inform the Bank without delay
of any event which is appropriate to materially adversely
affect the credit quality of the Facilities, such as major
disposals of assets or acquisitions. It will supply the Bank
with any information regarding the Borrower and any of its
subsidiaries and their financial affairs and those of any of
their subsidiaries which the Bank may request.
(c) Pari Passu: it will ensure that its liabilities under this
Agreement will rank at least equally with any and all other
present and future liabilities of the Borrower and/or its
subsidiaries other than those which are mandatorily privileged
by law;
(d) Negative Undertakings: in case the Borrower wants to untertake
one of the following actions under (i) to (vii), it will
provide the Bank in advance with detailed information. Should
the Bank acting reasonably conclude that such undertaking
represents a Material Adverse Change, such undertaking would
constitute an Event of Default according to Clause 9.1 (i).
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 12
(i) Negative Pledge: create any encumbrance or permit any
encumbrance to exist over all or any of its assets or
revenues or of the assets or revenues of all or any
of its subsidiaries, other than liens to secure
equipment financing or future permitted loans; or
(ii) Guarantees: give any guarantee, indemnity or other
security in connection with any other liability of
any other person otherwise than in the normal course
of its business; or
(iii) Capital Commitment: authorize or accept any capital
commitments outside the normal course of its
business; or
(iv) Merger: consolidate with or merge into any other body
corporate, or merge any other body corporate into
itself; or
(v) Disposal of Assets or Revenues: dispose, transfer,
grant or lease its assets or assets of its
subsidiaries, except if such disposal, transfer,
grant or lease is made in the ordinary course of
business. The disposal, transfer, grant or lease of
(a) patents, (b) trademarks, and (c) shares of
subsidiaries of the Borrower , however, are not
regarded as being in the ordinary course of business;
or
(vi) Major Acquisitions: purchase or undertake to purchase
(either itself or through any of its subsidiaries)
assets other than the planned Capex in kind and
amounts as defined in the Business Plan remitted to
the Bank and as limited in clause 7.5 (b), which will
result in a major change in the ability of the
Borrower to fulfill its present and future
obligations in relation to the Facilities, or a
change of its business activities; or
(vii) Reorganization: Enter into a de-merger or
reorganization which will result in a major change in
the ability of the Borrower to fulfill their present
and future obligations in relation to the Facilities.
7.2. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Bank that:
(a) the Borrower is a company duly organized and validly existing
under the laws of its country of incorporation with full power
and authority under such laws to own its properties and to
conduct its business;
(b) the making and performance of the Facilities have been duly
authorized by all necessary corporate action of the Borrower
and
(i) do not contravene any provision of any applicable law
or the Borrower's articles of association, and
(ii) will not result in a breach of or constitute a
default under any contractual provisions, the breach
of which would impair the Borrower's ability to
perform its obligations under this Agreement;
(c) this Agreement is valid and legally enforceable in accordance
with its terms against the Borrower in its country of
incorporation;
(d) there are no actions, suits or proceedings pending or, to the
knowledge of the Borrower, threatened against the Borrower or
any of its subsidiaries before any court, tribunal or
governmental body, agency, authority or other instrumentality
which might substantially adversely affect the financial
condition of the Borrower and/or of any of its subsidiaries or
their ability to perform their obligations hereunder;
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 13
7.3. SPECIFIC UNDERTAKINGS
Schaublin agrees that until all of its and its subsidiaries` liabilities under
this Agreement have been discharged and no commitment is outstanding:
(a) it will remit annual audited consolidated accounts of
Schaublin and its subsidiaries, including a covenant
compliance certificate pursuant to Clause 7.3.(c) hereafter,
within 120 days after the end of each financial year;
(b) it will remit annual audited accounts of Xxxxxxxxx XX within
120 days after the end of each financial year;
(c) it will remit annual audited accounts of Schaublin Holding SA
within 120 days after the end of each financial year;
(d) it will remit quarterly consolidated financial key figures of
Schaublin and its subsidiaries, including a covenant
compliance certificate pursuant to Clause 7.3.(c) hereafter,
within 90 days after the end of each financial quarter. These
consolidated financial key figures shall contain at least (1)
revenues, (2) order backlog, (3) EBITDA, (4) total debt, and
(5) all other relevant figures to calculate the Financial
Covenants;
(e) it will remit on a quarterly basis a covenant compliance
certificate, as defined in Annex C, showing the detailed
calculation of each Financial Covenant and signed by the Chief
Financial Officer of Schaublin;
(f) it will remit annual audited accounts of RBCF within 120 days
after the end of each financial year. For the fiscal year 2003
the financial year of RBCF will end at December 31 and will be
changed to March 31 in 2004;
(g) it will remit annual consolidated budgets of Schaublin an its
subsidiaries and a restated three-year business plan with key
financial projections within 30 days after their completion,
but no later than April 30 of each year;
(h) it represents and warrants that it has no knowledge of any
past, present or future fact related to the environment,
health and safety, which could materially affect it and/or any
of its subsidiaries in a negative way.
7.4. FINANCIAL COVENANTS
The following Financial Covenants as well as the ratio used for the Margin
calculation (ratio and amounts) to be calculated based on the consolidated
accounts of Schaublin must be permanently satisfied by Schaublin and all of its
subsidiaries on a consolidated basis. The calculation of the ratio shall as a
rule be carried out by Schaublin quarterly for the past 12 months (rolling
calculation period) and be remitted at the latest to the Bank 60 days after the
end of the calculation period. The first calculation period shall be January 1
until December 31, 2003. However, the Bank shall be entitled to demand the
financial data required to check on the compliance with the Covenants at any
time. The Financial Covenants will be restated and amended in case of a change
of Schaublin's and/or any of its subsidiaries accounting principles/policies
(especially in case of dissolution of hidden reserves, revaluation of assets,
capital gains from disposal of assets, change in accounting method(s), change in
depreciation and amortization policy, etc.):
(a) Minimum Interest Coverage Ratio
Definition:
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 14
Interest Coverage Ratio: Consolidated EBITDA divided by
consolidated Total Net Interest Expenses (as defined in Annex
C).
Minimum ratio at any time: 7.50x
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 15
(b) Minimum Net Worth
Definition:
Minimum Net Worth: Consolidated equity of Schaublin and its
subsidiaries, including subordinated shareholder loans.
Minimum ratios:
Period: Net Worth in CHF:
------- -----------------
until March 31, 2004 CHF 14,000,000.00
Thereafter for all periods CHF 15,000,000.00
Net Worth is being defined as the consolidated equity
including subordinated loans as of the end ot the measuring
period, after giving effect to a possible repayment on the
subordinated loans as set in Clause 8 on such date.
(c) Maximum Debt Capacity Ratio
Definition:
Debt Capacity: Consolidated senior bank debt divided by
consolidated trailing twelve-month EBITDA. Senior Bank Debt is
being defined as the amount due to the Bank as of the end ot
the measuring period, after giving effect to the principal
payment on such date.
Maximum ratios:
Period: Debt Capacity Ratio:
------- --------------------
until March 31, 2004 2.75x
until March 31, 2005 2.25x
until March 31, 2006 1.50x
thereafter 1.25x
(d) Minimum Inventory Turnover Rate
Definition:
Inventory Turnover: Consolidated trailing twelve-month Cost of
Goods Sold (COGS) divided by Inventory as stated at the end of
the measuring period.
Minimum ratio at any time: 1.00x
(e) Debt Restriction
No additional financial debt or similar obligations provided
to the Borrower and/or its subsidiaries shall be allowed
without prior written consent of the Bank, with the following
exceptions:
(i) revolving line of credit and letters of credit
facilities of EUR 750,000.00 (Euros seven hundred
fifty thousand and o/oo) in aggregate at the maximum
for RBCF granted by a local bank.
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 16
(ii) existing lease financing provided to the Borrower ;
(iii) existing subordinated debt provided by Schaublin
Holding of CHF 1,375,000.00 (Swiss francs one million
and three hundred seventy-five thousand and o/oo) to
the Borrower;
(iv) Subordinated debt in form of a shareholder loan by
Schaublin Holding as defined in Clause 8.
(d) Violation of financial covenants
A violation of any financial covenant described above may be
cured by a capital contribution by the Borrower's parent, i.e.
such capital contribution shall effectively be treated as an
increase to EBITDA for compliance measurement purposes.
7.5. OTHER COVENANTS
(a) Capital expenditures ("Capex")
Capex are limited to the amounts projected in the business
plan.
Projected Capex
Period (fiscal year) Max. amounts in CHF
-------------------- -------------------
1.4.2003 to 31.3.2004 975,000.00
1.4.2004 to 31.3.2005 945,000.00
1.4.2005 to 31.3.2006 945,000.00
thereafter per fiscal year 950,000.00
(b) Transaction with Shareholders / Related Parties
The Borrower undertakes for itself and its subsidiaries for
the whole duration of these Facilities not to provide any
credit or similar financial support to their shareholders or
any related parties to them, as well as not to enter into any
obligation or provide any financial or other support which is
not in due course of business. All other transactions in
normal course of business shall be done on an arm`s length
basis, including transactions between the Borrower and its
ultimate parent company in the USA and the latter affiliated
companies.
(c) Insurance Coverage and Environmental Risk
The Borrower confirms and undertakes for itself and its
subsidiaries and for the whole duration of this Agreement to
have adequate insurance coverage for their assets, losses due
to interruption of business activities, responsibility claim
of third parties as well as all other usual insurance coverage
for such business activities.
The Borrower confirms and undertakes for itself and its
subsidiaries and for the whole duration of this Agreement not
to enter in business activities which could bear any material
environmental risk.
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 17
--------------------------------------------------------------------------------
8. SHAREHOLDER LOAN
--------------------------------------------------------------------------------
Schaublin Holding will provide the Borrower with a shareholder loan in the
amount of CHF 150,000.00 (Swiss Francs one hundred fifty thousand and o/oo).
This loan will be subordinated to the Bank's Debt and will bear an interest rate
of 3.00%. The subordinated loan(s) of total CHF 1,525,000.00 may be repaid to
the extent that (i) the financial covenant levels set in this credit agreement
under clause 7.4. are still met after such payment and (ii) all amortizations
due under Facility A on or before such date as set in clause 4.3 shall have been
made.
--------------------------------------------------------------------------------
9. EVENTS OF DEFAULT
--------------------------------------------------------------------------------
9.1. EVENTS
The occurrence of any of the following is an Event of Default:
(a) Non-Payment: the Borrower, after a remedy period of seven (7)
Business Days from the due date, shall fail to pay any amount
of principal or interest, or any other amount due hereunder,
when same becomes due and payable under this Agreement; or
(b) Breach of Obligations: the Borrower and/or any one of its
subsidiaries and/or any third party mentioned in this
Agreement fails to perform or to observe any of the material
terms and conditions and/or material undertakings contained in
this Agreement and (if capable of remedy) such failure is not
remedied within twenty (20) days of its occurrence; or
(c) Misrepresentation: any representation or warranty made by the
Borrower or any third party under or in connection with this
Agreement shall turn out to have been incorrect or misleading
in any substantial material respect; or
(d) Cross-Default: the Borrower or any of its subsidiaries
(i) after giving effect to any applicable grace period,
shall fail to pay for borrowed money other than money
referred to under this Agreement, or any interest or
premium thereon, when due (whether at scheduled
maturity or by prepayment, acceleration, demand or
otherwise) or any other default under any agreement
or instrument relating to any such indebtedness, or
any other event shall occur, if the effect of such
default or event is to accelerate, or to permit the
acceleration of the maturity of such indebtedness, or
any such indebtedness shall be declared to be due and
payable, or required to be prepaid to the stated
maturity thereof, except for the case that the
aggregate amount of such default or event shall not
exceed CHF 250,000.00 per event and CHF 500,000.00
per annum; or
(ii) (a) becomes bound to repay prematurely any other loan
or obligation by reason of a default by the Borrower
or (as the case may be) any one of its subsidiaries
which is followed by an appropriate demand of such
repayment except where the Borrower or (as the case
may be) any one of its subsidiaries are taking action
in good faith to dispute the validity of the
obligation to repay such other loan or obligation
prematurely, except for the case that the aggregate
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 18
amount of such default or event shall not exceed CHF
250,000.00 per event and CHF 500,000.00 per annum; or
(b) fail to make any payment of principal, premium or
interest in respect of such other loan or obligation,
or any payment under a guarantee in respect of any
loan or other obligation, on the due date for such
repayment or within any grace period specified in the
agreement or other instrument constituting such other
loan, obligation or guarantee as aforesaid, except
for the case that the aggregate amount of such
default or event shall not exceed CHF 250,000.00 per
event and CHF 500,000.00 per annum.
(e) Winding-up or Dissolution: any order is made by any competent
court or other authority or resolution passed by the Borrower
for the dissolution or winding-up of the Borrower or any order
is made by any competent court or other authority for the
dissolution or winding-up of any of its subsidiaries or for
the appointment of a liquidator, receiver or trustee of the
Borrower or (as the case may be) any of its subsidiaries or of
the whole or any part of the undertaking or assets of the
Borrower or (as the case may be) any of its subsidiaries which
would be material in the context of this Agreement or the
Borrower or (as the case may be) any of its subsidiaries apply
for [Sursis Concordataire] (within the meaning ascribed to
that expression by the laws of Switzerland) or an equivalent
legal institution in case of any subsidiary; or
(f) Insolvency: the Borrower or (as the case may be) any of its
subsidiaries stop or threaten or declare their intention to
cease payments or are unable to, or admit to creditors
generally its inability to pay its debts as they fall due, or
is finally adjudicated or found bankrupt or insolvent, or
makes any conveyance or assignment for the benefit of or enter
into any composition or other arrangement with its creditors
generally; or
(g) Change of Control: any change of control in Schaublin
For the present purposes [Change of Control] shall mean:
That Schaublin is not anymore controlled 100% directly or
indirectly by Roller Bearing Company of America, Inc. and RBCF
is not anymore controlled 100% directly or indirectly by
Schaublin; or
(h) Security Enforceable: any present or future security on, over
or with respect to the assets of the Borrower and/or any one
of its subsidiaries become enforceable or any beneficiary of
encumbrances takes possession or a receiver is appointed of
the whole or any material part of the undertaking, property
and assets of the Borrower and/or any one of its subsidiaries
or a distress or execution is levied or enforced upon or sued
for all or any material part of the assets of the Borrower
and/or any one of its subsidiaries; or
(i) General Material Adverse Change: a change in the business,
operations, sales, costs, assets or liabilities of the
Borrower and/or any of its subsidiaries which individually or
in the aggregate, have materially affected or are likely in
the future to materially affect the financial condition, net
worth and profitability of the Borrower; or
(j) Unlawfulness, Invalidity: it is or becomes unlawful for the
Borrower to perform promptly any of its obligations under this
Agreement or for the Bank to exercise any of its rights under
this Agreement, or if this Agreement for any other reason
becomes invalid or unenforceable or ceases to be in full force
and effect, or if the Borrower does or causes or permit to be
done anything which evidences an intention to contest or
repudiate this Agreement wholly or in part; or
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 19
(k) Compliance with Laws: the Borrower and/or any one of its
subsidiaries ceases or will cease to comply with any law,
regulation or requirement applicable to it in the carrying out
of their business if such failure to comply would materially
impair its ability to perform their obligations under this
Agreement.
--------------------------------------------------------------------------------
9.2. CONSEQUENCES
--------------------------------------------------------------------------------
If an Event of Default occurs, the Bank may, upon notice in writing to the
Borrower immediately terminate the commitment and declare all Advances and all
other Bank debts hereunder to be forthwith due and payable, whereupon the unpaid
principal amount of such Advances together with accrued interest to the date of
declaration and all other amounts due hereunder shall become immediately due and
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby expressly waived by the Borrower .
--------------------------------------------------------------------------------
10. SET-OFF
--------------------------------------------------------------------------------
10.1. SET-OFF
The Bank may at any time take all or any of the following steps:
(a) open a new account in the name of the Borrower (defined as
Schaublin, as applicable) and debit that account, or debit an
existing account of the Borrower with any amount due to the
Bank by the respective Borrower;
(b) combine or consolidate, regardless of currency, all or any of
the accounts with the Bank in the name of the respective
Borrower or to which the respective Borrower is beneficially
entitled at any of the Bank`s branches in any country or
territory; and
(c) (after taking into account any combination or consolidation of
accounts), set off any amount standing to the credit of any
such account by applying any such credit balance in or towards
payment of any amount due to the Bank.
10.2. CURRENCY CONVERSION
The Bank may at any time use any of the Borrower`s credit balances with the Bank
to purchase at the Bank's applicable spot rate of exchange any other currency or
currencies which the Bank considers necessary to reduce or discharge any amount
due to the Bank, and may apply that currency or those currencies in or towards
payment of those amounts.
--------------------------------------------------------------------------------
11. INDEMNITIES
--------------------------------------------------------------------------------
11.1. GENERAL INDEMNITY
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 20
The Borrower will indemnify the Bank against all losses (including but not
limited to losses from liquidating or re-employing deposits from third parties
which were acquired to effect or maintain the Facilities or any part of them)
and expenses which the Bank may incur (after taking into account any payments to
the Bank of interest at a default rate) as a result of the occurrence of:
(a) an Event of Default; and/or
(b) the failure of the Borrower to pay any amount due under this
Agreement on the due date; and/or
(c) any Advance being repaid or prepaid for any reason otherwise
than on the last day of its term; and/or
(d) any Advance not being borrowed for any reason (excluding
default by the Bank) after a notice requesting that Advance
has been sent to the Bank by the Borrower .
11.2. CURRENCY INDEMNITY
If any payment in connection with this Agreement is made or recovered in a
currency other than that in which it is required to be paid then, if the payment
to the Bank (when converted at the Bank's rate of exchange on the date of
payment or, in the case of a liquidation of a company of Schaublin and/or one of
its subsidiaries, the latest date for the determination of liabilities permitted
by the applicable law) falls short of the amount remaining unpaid under this
Agreement, the Borrower will indemnify the Bank against the amount of such
shortfall.
--------------------------------------------------------------------------------
12. FEES AND EXPENSES
--------------------------------------------------------------------------------
12.1. STRUCTURING FEE
Schaublin will pay to the Bank a structuring fee of CHF 50,000.00, payable
within 30 days as from the signing of this Agreement.
12.2. EXPENSES
All out-of-pocket expenses, costs, charges, tax and expenses, including legal
fees, incurred by the Bank in connection with the negotiation, preparation and
completion of this Agreement shall be borne by the Bank. Out-of-pocket expenses,
including legal fees, incurred in connection with any change, reorganization,
amendment of this Agreement after the signing date shall be borne by the
Borrower .
12.3. VALUE ADDED TAX
All amounts stated in this agreement to be payable by the Borrower are exclusive
of value added tax or any similar tax properly chargeable in respect of services
under this Agreement, and the Borrower will pay all tax of this nature together
with the amounts on which such tax shall be levied.
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 21
--------------------------------------------------------------------------------
13. ASSIGNMENT, TRANSFER AND LENDING OFFICES
--------------------------------------------------------------------------------
13.1. NO ASSIGNMENT BY THE BORROWER
The Borrower may not assign or transfer any of its rights or obligations under
this Agreement, except with the prior written approval of the Bank.
13.2. ASSIGNMENT AND TRANSFER BY THE BANK
The Bank shall be entitled to transfer or assign the whole or any part of its
rights and obligations under the Facility to an affiliated, controlled or
related company or other entity and provided that such assignment will not in
any way be prejudicial to the Borrower from a tax perspective, subject to prior
notification of the Borrower. In particular, the Bank shall not be entitled to
transfer or assign the whole or any part of its rights and/or obligations under
this Agreement if the consequence was that all or any of the Facilities would be
deemed to be a bond for Swiss tax purposes. Any other transfer/assignment may be
effected with the prior written approval of the Borrower only, which approval
shall not be unduly withheld. For the transfer and/or the assignment of the
Bank's rights and/or obligations and to prepare such a transfer and/or
assignment of the Bank's rights and/or obligations the Borrower releases the
Bank from the obligation to observe banking secrecy.
--------------------------------------------------------------------------------
14. NOTIFICATION
--------------------------------------------------------------------------------
14.1. BY THE BANK
All notification by the Bank to the Borrower as well as all correspondence in
connection with these Facilities shall be delivered either in person, sent by
mail or telefax and shall be deemed to have been duly given if addressed to:
Xxxxxxxxx XX
c/o Roller Bearing Company of America, Inc.
00 Xxxxx Xxxx Xxxx
Xxxxxxxxx, XX 00000
XXX
Attention: Xxxxxxx X. Xxxxxxxxx
Telephone: 000 (000) 000-0000
Telefax: 000 (000) 000-0000
With a copy to:
Xxxxxxxxx XX
Attention: Xxxx-Xxxx Xxxxxx, Operations Director
Xxx xx xx Xxxxxxxxxx 0
0000 Xxxxxxxx
14.2. BY THE BORROWER
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 22
All notification by the Borrower to the Bank as well as all correspondence in
connection with these Facilities shall be delivered either in person, sent by
mail or telefax and shall be deemed to have been duly given if addressed to:
CREDIT SUISSE
Attention: C. Saucy
X.X. Xxx 000
0000 Delemont
Telephone: xx00 (0)00 000 00 00
Telefax: xx00 (0)00 000 00 00
14.3. OBJECTIONS
Any objection by the Borrower relating to the execution or non-execution of any
order of any kind as well as any objection to any statement of account or any
other communication must be made within seven Business Days upon receipt of the
respective communication; otherwise the execution or non-execution of the order
as well as the pertinent statements and communications are deemed to have been
approved.
--------------------------------------------------------------------------------
15. GOVERNING LAW AND JURISDICTION
--------------------------------------------------------------------------------
This Agreement will be governed by and construed in accordance with Swiss law,
which shall also govern any decision as to the validity of this choice of law
clause.
Any dispute arising out of or in connection with this Agreement shall be settled
by the competent courts of the canton of Jura and the Swiss Confederation, venue
being Delemont, provided always that the Bank shall be entitled to institute
proceedings against the Borrower before any competent court, including, but not
limited to the courts competent at the places or registered offices of the
Borrower or any of its subsidiaries.
--------------------------------------------------------------------------------
16. MISCELLANEOUS
--------------------------------------------------------------------------------
16.1. CONFIDENTIALITY
The parties hereto will keep the information contained in this Agreement
confidential subject to agreed exceptions, such as disclosure required by law,
disclosure of information already in the public domain without default by any of
the parties hereto and disclosure to professional advisors on a need to know
basis.
16.2. NO WAIVER
The Bank shall not be considered having waived any of its rights under this
Agreement if it has not exercised such right in a given case or has exercised
such rights only partially.
16.3. SEVERABILITY
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 23
If, at any time, any provision of this Agreement is or becomes illegal, invalid
or unenforceable in any respect under the laws of any jurisdiction, neither the
legality, validity or enforceability of the remaining provisions hereof nor the
legality, validity or enforceability of such provision under the law of any
other jurisdiction shall in any way be affected or impaired thereby and the
Borrower and the Lender agree that any void provision shall be replaced by a new
provision being as close as possible to the void one.
16.4. INTERPRETATION
Words importing the plural shall include the singular and vice versa. CHF shall
mean Swiss Francs and vice versa. EUR shall mean Euros and vice versa.
16.5. ORIGINALS
The parties hereto have executed this Agreement - constituting the legally
binding Agreement - in three originals (two for the Borrower and one for the
Bank).
The enclosed General Conditions are integral part except as stated otherwise
within this Agreement. In case of a contradiction between this Agreement and the
General Conditions, this Agreement shall prevail.
SIGNED on behalf of each of the parties:
Delemont, December 8, 2003
The Borrower :
Xxxxxxxxx XX
-----------------------------------------------
Third Party:
Schaublin Holding SA
-----------------------------------------------
The Bank:
CREDIT SUISSE
-----------------------------------------------
Th. Xxxxx X. Saucy
Director Assistant Vice President
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 24
ANNEX A
CONDITIONS PRECEDENT-
ITEMS REQUIRED BEFORE AN ADVANCE OR OTHER FUNDS MAY BE BORROWED
The Bank shall not be obliged to permit any drawdown by the Borrower, and the
Borrower shall not give any notice of drawing, unless and until the Bank has
received the following documents and evidence and has found them to be
satisfactory in form and substance:
(a) any obligation of the Bank to permit the initial drawdown shall be
subject to the following conditions precedent:
(i) formation and existence of Xxxxxxxxx XX and all its
subsidiaries;
(ii) certified copies of the constitutional documents for each
company entering into financing documentation;
(iii) Board resolutions confirming the approval for entering into
financing documentation for each company entering into
financing documentation;
(iv) completion and execution of all loan documentation relating to
the Facilities, including execution of all required guarantee
and security documentation;
(v) transfer of all the pledged shares requested in this Agreement
into safe custody accounts with the Bank;
(vi) all necessary corporate authorizations for the entry into the
transaction documents;
(vii) receipt of financial information in form and substance
satisfactory to the Bank;
(viii) no Material Adverse Change in operations, business,
properties, conditions (financial or otherwise) or prospects
of the Borrower and all of their subsidiaries since March 31,
2003 (audited numbers) and September 30, 2003.
(ix) absence of any material pending or threatened litigation or
other proceedings;
(x) compliance with and maintenance of all applicable laws and
regulations, including all required regulatory consents and
approvals (unless failure to comply which does not materially
impair the Borrower's ability to perform their obligations
under this Agreement).
(b) any obligation of the Bank to permit any drawdown under this Agreement
shall be subject to the following conditions precedent:
(i) all Representations and Warranties made by the Borrower in
this Agreement or in the security documents are true and
correct;
(ii) no Event of Default has occurred and is continuing or will
occur as a result of draw-down;
(iii) no breach of any provisions under this Agreement or the
security documents;
(iv) receipt of duly completed and signed Fixed Term Advance
Request by the Bank, unless the Bank accepts a simplified
drawdown procedure for Advances under Facility B;
(v) such other documents relating to any of the matters
contemplated herein as the Bank may reasonably request.
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 25
ANNEX B
FIXED TERM ADVANCE REQUEST
From: [Name of company, address] ([Borrower])
To: Credit Suisse, Delemont ([Lender])
Date
Dear Sirs,
We refer to the Agreement (as from time to time amended, varied, novated or
supplemented, the [Facilities]) dated December 8, 2003, and made between
Schaublin and Credit Suisse.
We hereby give you notice that we wish to make a fixed term Advance under these
Facilities as follows:
Facility (A, B):
-------------------------------------------------------------
Currency:
-----------------------------------------------------------------------
Amount:
-------------------------------------------------------------------------
First value date:
---------------------------------------------------------------
Duration:
-----------------------------------------------------------------------
To be transferred to account: No:
------------------------------------------
Beneficiary:
---------------------------------
Bank:
----------------------------------------
We confirm that at the date thereof, the Representations and Undertakings set
out in the Agreement are true and no event which is or may become (with the
passage of time, the giving notice, the making of any determination under the
Agreement or any combination thereof) an Event of Default has occurred.
Yours Sincerely,
For and on behalf of [Name of company]
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 26
ANNEX C
COMPLIANCE CERTIFICATE
The undersigned officer of Schaublin hereby certifies that he is the Chief
Financial Officer of Schaublin, and that as such he is authorized to execute
this compliance certificate required to be furnished pursuant to the Credit
Agreement, dated December 8, 2003, and further certifies that:
1) Attached hereto is a copy of the Borrower`s quarterly statements for
the period ending [ _____ _______ ], which contains the consolidated
balance sheet and the related consolidated statements of income and
cash flows of Schaublin and all its subsidiaries, setting forth in each
case in comparable form the figures for the previous year (collectively
the "Financial Statements").
2) The Financial Statements are complete and correct in all material
respects and were prepared in reasonable detail and in accordance with
the Swiss Generally Accepted Accounting Principles (FER or IAS applied
consistently throughout the periods reflected therein.
3) The undersigned has no knowledge of any Default or Event of Default.
4) The following calculations as of [ ______________ ] support the
statement made in paragraph 3 above with respect to the Credit
Agreement.
i) Minimum Interest Coverage Ratio
Total Interest Expenses _____________
- Total Interest Income _____________
-----------------------
Total Net Interest Expenses "B" _____________
Consolidated Net Income _____________
+ Taxes _____________
+ Total Net Interest Expenses "B" _____________
---------------------------------
EBIT _____________
+ Amortization of Goodwill _____________
+ Depreciation _____________
--------------
EBITDA "A" _____________
Minimum Interest Coverage Ratio ("A" divided by "B") _____________
Covenant Minimum ____ 7.50x ___
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 27
Page 2
ii) Minimum Net Worth
Consolidated Share Capital _____________
+ Consolidated Reserves _____________
+ Consolidated Retained Earnings _____________
+ Subordinated shareholder loans _____________
Net Worth _____________
Covenant Minimum _____________
iii) Maximum Debt Capacity Ratio
Consolidated Senior Bank Debt "A" _____________
Consolidated EBITDA (as determined in i) above) "B" _____________
Maximum Debt Capacity Ratio ("A" divided by "B") _____________
Covenant Maximum _____________
iv) Minimum Inventory Turnover Rate
Cost of Goods sold "A" _____________
Inventory "B" _____________
Minimum Inventory Trunover Rate ("A" divided by "B") _____________
Covenant Minimum ___ 1.00x ____
Xxxxxxxxx XX
----------------------------
(Name, Title)
----------------------------
(Date)
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 28
ANNEX D
General Conditions
See separate Document
--------------------------------------------------------------------------------
Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 29
ANNEX E
Special Deed of Pledge
1. The undersigned
Schaublin Holding XX
Xxx xx xx Xxxxxxxxxx 0
0000 Xxxxxxxx
(hereinafter referred to as pledgor)
herewith pledges in favour of Credit Suisse (hereinafter referred to as
Bank) the securities, savings and investment books of any kind
(hereinafter referred to as books), loan stock rights not evidenced by
certificates (especially securities for which the issue of certificates
is deferred), metal deposits and other valuables listed hereafter and
held by the Bank or held under their name but for the pledgor's account
by any agent or representative of the Bank, as well as any rights to
recovery of possession of such assets. Securities which are not in
bearer form are pledged to the Bank in accordance with Article 901,
Section 2 of the Swiss Civil Code (hereinafter referred to as the SCC).
The pledge also includes all forfeited, current and future associated
rights such as interest and dividend payments and subscription rights.
2. The purpose of this pledge is to cover any and all claims of the Bank
against
Xxxxxxxxx XX
Blancherie 9
2800 Delemont
(hereinafter referred to as debtor)
as a result of any contract or agreement entered into or to be entered
into in the future within the framework of business relationships. This
applies to both the principal and the accrued and maturing interest,
commissions and fees. Collateral deposited with one of the Bank's
offices is also liable for claims of other offices of the Bank. In the
case of several claims, the Bank shalldetermine for which claim the
collateral or liquidation proceeds are liable.
3. The pledgor hereby assigns to the Bank all insurance and other private
or public law claims (including expropriation claims) accruing to him
with respect to the aforementioned securities and property, and the
Bank are entitled to effect the necessary communications and to collect
such proceeds or indemnification and to give receipt on his behalf .
4. The present pledge shall be in addition to and independent of any
existing or future guarantees and shall remain in force until such time
as the obligations to the Bank shall have been fulfilled in their
entirety. The release of individual pledged items from the pledge does
not affect the Bank's lien on the other pledged items. In the event
that collateral is exchanged, the new items shall be subject to this
pledge without further formalities. This applies in particular to
repayments of titles, whereby the corresponding proceeds replace the
title and become subject to the pledge. The whole item is subject to
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 30
this pledge, even if its value is increased by reason of additional
payments or for any other reason.
5. Should the bank refrain from exercising its right of pledged property,
or delay in doing so, this neither constitutes a waiver of the Bank's
right nor does it entail any responsability for the Bank. Upon their
claims becoming due, the Bank shall also be entitled to dispose of the
pledged collateral at its discretion, provided, however, previous
notice has been given to the debtor. The obligation to give notice
shall be waived in the event of impending danger (marked fluctuations
in market prices, etc.). The Bank is entitled to institute ordinary
execution for payment of a debt against the debtor without having first
to realise the collateral by forced execution or by free sale. In doing
so, the Bank does not, however, waive its rights under the lien or
pledge.
6. If the deed of pledge is issued on behalf of third parties, all notices
shall be deemed to be valid if they have been sent to the debtor. In
the case of pledged books, the Bank is entitled to notify the issuer
that a book has been pledged. The pledgor undertakes to cooperate with
the Bank to transfer the collateral to a new buyer. Pledged securities
which are not in bearer form are hereby assigned blank to the Bank in
the event that it should become necessary to dispose of them.
7. The Bank's form of Safe Custody Regulations and General Conditions,
receipt of which is hereby confirmed, supplement the terms of this
contract.
8. For the fulfilment of all commitments arising from the establishment of
this pledge, the pledgor elects special domicile at CREDIT SUISSE in
Delemont.
Swiss law shall be applicable in the interpretation of this pledge. Any
dispute arising out of or in connection with this document shall be
submitted for judgement to the ordinary Courts of the Canton of Jura
subject to appeal to the Swiss Federal Court at Lausanne. The Bank has,
however, the right to take legal action before the court at the
undersigned's domicile or before any other competent court.
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 31
List of pledged assets, rights and claims
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Number of shares
-1366- Pledge of 99.4% of the shares of Xxxxxxxxx XX,
Delemont, with a nominal value of CHF 100'000.--
Place, date Signature
Delemont, December 8, 2003
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Board of Directors of Schaublin
Holding SA
The board of directors of Xxxxxxxxx XX, Delemont, hereby agrees to the pledge by
Schaublin Holding SA of 1366 shares of Xxxxxxxxx XX in favour of CREDIT SUISSE.
The board understands that the pledge is made in order to support its
indebtedness towards CREDIT SUISSE. This deed of pledge is hereby ratified by
the board of Xxxxxxxxx XX. If the collateral is realised by forced execution or
by free sale, the board of Xxxxxxxxx XX herewith already agrees to register any
new acqueror of the shares in the shareholders'registry.
Delemont, December 8, 2003
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Board of Directors of Xxxxxxxxx XX
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Credit Agreement between Xxxxxxxxx XX and Credit Suisse Page 32
