EXHIBIT 99.2
FORBEARANCE AGREEMENT, CONSENT AND THIRD AMENDMENT
This Forbearance Agreement, Consent and Third Amendment dated as of
January ___, 2001 (this "AGREEMENT") is by and between The York Group, Inc., a
Delaware corporation (the "COMPANY"), and The Variable Annuity Life Insurance
Company, a Texas corporation (the "PURCHASER", and together with its successors
and assigns and any holder of Notes (as such term is defined below), the
"HOLDERS").
INTRODUCTION
A. The Company and the Purchaser are parties to the Senior Note Purchase
Agreement dated as of June 30, 1994, as amended by a First Amendment dated as of
August 12, 1999 and a Second Amendment dated as of May 12, 2000, and as modified
and supplemented by certain temporary waivers executed since May 12, 2000 (as so
amended, modified or supplemented, the "NOTE PURCHASE AGREEMENT"), pursuant to
which the Company issued and sold to the Purchaser $25,000,000 aggregate
principal amount of the Company's Senior Secured Notes due June 30, 2004 (the
"NOTES").
B. As of the date hereof, the Purchaser remains the owner and holder of
all issued and outstanding Notes.
C. The Company and the Purchaser wish to, subject to the terms and
conditions of this Agreement, (1) acknowledge the existence of certain Defaults
and Events of Default (each as defined in the Note Purchase Agreement), (2)
provide for a temporary forbearance period during which the Holders agree not to
take action with respect to such existing Defaults and Events of Default, and
(3) amend certain provisions of the Note Purchase Agreement.
THEREFORE, the Company and the Purchaser hereby agree as follows:
Section 1. DEFINITIONS; REFERENCES. Unless otherwise defined in this
Agreement, each term used in this Agreement which is defined in the Note
Purchase Agreement has the meaning assigned to such term in the Note Purchase
Agreement.
Section 2. FORBEARANCE; CONSENTS; AMENDMENTS TO NOTE PURCHASE AGREEMENT.
(a) FORBEARANCE.
(i) The Company hereby acknowledges the existence of the following
Defaults and Events of Default (collectively, the "EXISTING DEFAULTS"):
(A) the Company's noncompliance with Section 4.1 of the Note
Purchase Agreement requiring a partial prepayment of the outstanding
principal of the Notes on December 31, 2000;
(B) the Company's noncompliance with the interest payment
terms of the Notes with respect to payments due on July 31, 2000,
August 31, 2000, September 30, 2000, October 31, 2000, November 30,
2000 and December 31, 2000;
(C) the Company's noncompliance with Sections 6.1(a), (b), (c)
and (e) of the Note Purchase Agreement with respect to financial
reporting specified therein;
(D) the Company's noncompliance with Section 6.2 of the Note
Purchase Agreement with respect to compliance with the State of
Georgia's Environmental Laws;
(E) the Company's noncompliance with the requirements of
Section 7.13 of the Note Purchase Agreement for the calendar months
ended September 30, 2000, October 31, 2000, November 30, 2000 and
December 31, 2000;
(F) the Company's noncompliance with the requirements of
Section 7.2 of the Note Purchase Agreement for the calendar months
ended June 30, 2000, July 31, 2000, August 31, 2000, September 30,
2000, October 31, 2000, November 30, 2000 and December 31, 2000;
(G) the Company's noncompliance with the requirements of
Section 7.15 of the Note Purchase Agreement for the fiscal quarters
ended June 30, 2000, September 30, 2000 and December 31, 2000;
(H) the Company's noncompliance with the requirements of
Section 6.14 of the Note Purchase Agreement and Section 4.06 of the
Security Agreement due to the Company's withdrawal of all funds held
in the Concentration Account, the Company's failure to deposit, on a
daily basis, all receipts and deposits into such Concentration
Account, and the Company's failure to provide an Acceptable Security
Interest in the Company's and its Subsidiaries' bank accounts;
(I) the Event of Default arising under Section 9.1(f) of the
Note Purchase Agreement with respect to payment of scheduled
principal and interest due on December 31, 2000 to the Lenders under
the Credit Agreement;
(J) the Event of Default arising under Section 9.1(f) of the
Note Purchase Agreement with respect to payment of principal and
interest due on certain subordinated Debt due on November 30, 2000
and December 31, 2000; and
(K) notwithstanding anything herein to the contrary, with
respect to (D) and (J) above, the continued or further noncompliance
of the types of noncompliance set forth with respect to (D) and (J)
above of the Company with
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respect to the matters set forth in such subsections shall be deemed
to be an "Existing Default".
(ii) The Holders hereby agree, subject to the terms of this
Agreement, to forbear from exercising any of their rights and remedies
under any of the Financing Documents (other than those under Section 6.9
of the Note Purchase Agreement, it being agreed that the Existing Defaults
constitute Events of Default that have occurred and are continuing for
purposes of such Section 6.9) arising solely as a result of the Existing
Defaults, including any rights to accelerate payments, to enforce security
interests, to file an involuntary bankruptcy petition against the Company
or any of its subsidiaries, or to enforce the obligations under the
Financing Documents until the date (the "FORBEARANCE TERMINATION DATE")
that is the earlier to occur of (A) June 30, 2001, and (B) the date of the
occurrence of a Forbearance Default (as defined below).
(iii) The forbearance by the Holders described above is contingent
upon the satisfaction of the conditions precedent set forth below and is
limited to the Existing Defaults. This forbearance is limited to the
extent described herein and shall not be construed to be a consent to or a
permanent waiver of the Existing Defaults or any other terms, provisions,
covenants, warranties or agreements contained in the Note Purchase
Agreement or in any of the other Financing Documents. The Holders reserve
the right to exercise any rights and remedies available to them in
connection with any other present or future defaults with respect to the
Note Purchase Agreement or any other provision of any Financing Document.
(iv) The Company hereby further agrees and acknowledges that (A) the
Existing Defaults have not been permanently waived as a result of this
Agreement and that such forbearance is temporary in nature, and (B)
concurrent with the Forbearance Termination Date, all rights and remedies
of the Holders enjoined as a result of this Section 2(a) shall be
reinstated.
(v) The following shall constitute a "FORBEARANCE DEFAULT" under
this Agreement:
(A) the failure of the Company to comply with any covenant or
agreement contained in this Agreement; or
(B) any representation or warranty contained in this Agreement
shall be incorrect in any material respect; or
(C) the existence of any Default or Event of Default (other
than an Existing Default); or
(D) the existence of any Default or Event of Default (each as
defined in the Credit Agreement) under the Credit Agreement, and the
Agent or the Lenders shall have exercised (or attempted to exercise)
any rights or remedies in respect of
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such Default or Event of Default or otherwise taken (or attempted to
take) any action with respect thereto; or
(E) any holder of the Debt evidenced by (i) that certain
Promissory Note (Renewal and Extension) issued by the Company to
Houston Casket Company in the face principal amount of $1,500,000,
made effective January 17, 2000 and given in renewal and extension
of a certain Promissory Note in like face principal amount dated
January 17, 1997, or (ii) that certain Promissory Note (Renewal and
Extension) issued by the Company to North Texas Casket Company in
the face principal amount of $1,000,000, made effective January 17,
2000 and given in renewal and extension of a certain Promissory Note
in like face principal amount dated January 17, 1997 (collectively,
the "NONPAYABLE SUBORDINATED DEBT"), shall exercise any rights or
remedies (including, without limitation, acceleration of any such
Nonpayable Subordinated Debt) or take any enforcement action or
action toward collection of any of such Nonpayable Subordinated
Debt.
(b) INTEREST RATES. Effective September 1, 2000, the Notes shall bear
interest (i) from September 1, 2000 through and including October 31, 2000 at a
rate per annum of 8.87% and (ii) from and after November 1, 2000 at a rate per
annum of 11.02%; PROVIDED, that if an Event of Default shall have occurred and
be continuing (excluding an Existing Default during the Forbearance Period), the
Notes shall bear interest (after giving effect to the increases set forth below,
if any) at the Default Rate. Notwithstanding the foregoing, the interest rate
applicable to the Notes shall, in addition to the Default Rate (if applicable),
be subject to the following potential separate and distinct increases:
(i) an increase of 0.25% to the interest rate then in effect with
respect to the Notes will occur on February 15, 2001 if cumulative asset
sales of the Company and its Subsidiaries from the date of this Agreement
through such date do not result in aggregate principal reductions
(attributable to the mandatory prepayments associated with such asset
sales) of at least $10,000,000 with respect to all Indebtedness (as
defined in the Intercreditor Agreement);
(ii) an increase of 0.25% to the interest rate then in effect with
respect to the Notes will occur on March 31, 2001 if cumulative asset
sales of the Company and its Subsidiaries from the date of this Agreement
through such date do not result in aggregate principal reductions
(attributable to the mandatory prepayments associated with such asset
sales ) of at least $18,000,000 with respect to all Indebtedness (as
defined in the Intercreditor Agreement); and
(iii) an increase of 0.25% to the interest rate then in effect with
respect to the Notes will occur on May 31, 2001 if the Holders are not
provided with a commitment letter or letters reasonably satisfactory to
the Holders in their sole and absolute discretion with respect to a
financing package sufficient to prepay in full the Notes and all other
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obligations owing to the Holders and the Collateral Agent under the
Financing Documents on or before June 30, 2001.
Each of the foregoing increases shall be effective as of the respective dates
for such increases set forth above and shall apply to all Notes. All accrued and
unpaid interest arising on or prior to the Effective Date as a result of the
foregoing increases shall be paid by the Company on the Effective Date. In order
to evidence the increase in the interest rate to be borne by the Notes from and
after September 1, 2000, the form of Note annexed as Exhibit A to the Note
Purchase Agreement is hereby amended, effective as of the Effective Date (as
hereinafter defined), to read in its entirety as set forth on ANNEX A attached
hereto.
Notwithstanding the foregoing, for purposes of calculating any Make-Whole
Premium Amount, and for no other purpose, the interest rate shall be deemed to
be 7.87% per annum.
(c) REFINANCING OF OTHER INDEBTEDNESS. It is the intent of the parties
hereto that the Notes and all other obligations owing to the Holders and the
Collateral Agent under the Financing Documents shall be prepaid in full
simultaneously with any refinancing of the Company's obligations under the
Credit Agreement and related documents, whether such refinancing occurs upon the
stated maturity of such obligations or otherwise. Accordingly, Section 9.1 of
the Note Purchase Agreement is hereby amended, effective as of the Effective
Date, by adding the following new subsection (p) at the end thereof:
"(p) The Debt and other obligations of the Company outstanding under
the Credit Agreement and related documents shall have been refinanced, in
whole or in part, whether at the stated maturity of such Debt or
otherwise, unless prior to or concurrently with such refinancing all
principal of, interest on and Make-Whole Premium Amount (if any) in
respect of the Notes, together with all other obligations of the Company
and the Guarantors owing to the Holders and the Collateral Agent under the
Financing Documents, shall have been prepaid in full."
(d) DEFAULT INTEREST RATE. Effective as of the Effective Date:
(i) Section 9.5 of the Note Purchase Agreement is hereby amended by
deleting the words and punctuation "shall bear interest at a rate per
annum (the "Default Rate") equal to 11.37%" at the end of the first
sentence thereof and replacing them with the following: "shall bear
interest at the Default Rate"; and
(ii) Section 12.1 of the Note Purchase Agreement is hereby amended
by inserting the following definition in the appropriate alphabetical
position:
""Default Rate" shall mean, at any time upon the occurrence of an
Event of Default and until such Event of Default has been cured or waived
in writing, a rate of interest per annum from time to time equal to the
lesser of (i) the maximum rate permitted by applicable law and (ii) 2.0%
over the rate of interest in effect immediately prior to such Event of
Default."
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(e) MANDATORY PREPAYMENT SCHEDULE. Effective as of the Effective Date,
Section 4.1 of the Agreement is hereby amended by deleting it in its entirety
and inserting in lieu thereof the following:
"4.1 MANDATORY PREPAYMENTS. The Notes shall be subject to mandatory
prepayment as follows: on January 31, 2001 and on the last day of each
month thereafter to and including May 31, 2004 (so long as the Notes shall
be outstanding), the Company will prepay $148,809.52 of the aggregate
principal amount of the Notes or, if the unpaid balance thereof is less,
then such other amount as may be then currently outstanding. The entire
remaining principal amount of the Notes shall become due and payable on
June 30, 2004. Each such prepayment under this SECTION 4.1 shall be at the
principal amount so to be prepaid, together with accrued interest thereon
to the date of such prepayment, without premium or prepayment charge."
In addition to the $148,809.52 scheduled mandatory prepayment due and payable on
May 31, 2001, the Company shall also pay on such date, without premium or
prepayment charge, an amount equal to $2,500,000 to the Holders and the Lenders
under the Credit Agreement, which amount shall be paid to the Collateral Agent
and distributed to the Holders and such Lenders in accordance with their
respective Pro Rata Shares (as defined in the Intercreditor Agreement) and
applied, in the case of distributions to the Holders, to prepayment of the
outstanding principal amount of the Notes in accordance with Section 4.2(c) of
the Agreement.
Notwithstanding Section 4.1 of the Note Purchase Agreement, as amended hereby,
the Company shall be credited with, and shall be deemed to have made a mandatory
prepayment in respect of, the $148,809.52 scheduled mandatory payment due and
owing on January 31, 2001 to the extent (but only to the extent) that mandatory
prepayments are made in respect of the Notes on or before January 31, 2001 as a
result of asset Transfers permitted by this Agreement. To the extent that such
asset Transfers do not result in the prepayment of at least $148,809.52 in
aggregate principal amount of the Notes on or before January 31, 2001, the
Company shall still be required to pay the shortfall amount on January 31, 2001.
The deemed credit provided for in this Section 2(e) shall only exist with
respect to the January 31, 2001 scheduled mandatory prepayment, and no other
mandatory prepayments of the Notes as a result of asset Transfers permitted by
this Agreement shall be credited against future scheduled mandatory prepayments
under Section 4.1 of the Note Purchase Agreement.
It is understood that certain post-closing purchase price adjustments may occur
within the 90-day period following each asset sale of the Company or its
Subsidiaries under the terms of the relevant asset purchase documents. If as a
result of a post-closing purchase price adjustment the Company owes a rebate to
the relevant purchaser, then (i) the Company (or such Subsidiary) shall pay such
rebate to the relevant purchaser and (ii) the Company shall receive a credit
against its future mandatory prepayment obligations owing in respect of the
Indebtedness (such credit to be allocated on a pro rata basis by the holders of
all Indebtedness under the Intercreditor Agreement) in an amount equal to the
relevant percentage (either 80% or 90% depending on the amount originally
received by the Collateral Agent with respect to the relevant asset sale) of
such
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rebate payment (but only to the extent such rebate payment is actually made).
If, however, as a result of such post-closing purchase price adjustment the
Company receives an additional payment from the relevant purchaser as additional
amounts owing in respect of the purchase price, then the relevant percentage of
such amounts (80% or 90%, as applicable) shall be paid to the Collateral Agent
and applied to the Indebtedness in accordance with the terms of this Agreement
and the Intercreditor Agreement.
(f) FEES. The Company shall pay to the Purchaser an amendment fee of
$39,000, payable in installments as follows: (i) $13,000 on January 31, 2001,
(ii) $13,000 on March 31, 2001, and (iii) $13,000 on May 31, 2001; PROVIDED,
that the May 31, 2001 installment shall be deemed to be waived by the Holders
if, on or before May 31, 2001, the Holders are provided with a commitment letter
reasonably satisfactory to the Holders in their sole and absolute discretion
with respect to a financing package sufficient to prepay in full the Notes and
all other obligations owing to the Holders and the Collateral Agent under the
Financing Documents on or before June 30, 2001.
Under Section 7 of the Second Amendment dated as of May 12, 2000, the Company
was required to pay a portion of the amendment fee specified therein on August
31, 2000. Notwithstanding this requirement, the Company failed to pay the total
amount of the portion of such amendment fee that was due on such date. The
Purchaser hereby waives its right to receive the remaining unpaid amount of the
portion of such amendment fee that was due on such date.
(g) RESTRICTED PAYMENTS. From and after the Effective Date, the Company
shall not redeem, purchase or otherwise acquire any shares of its capital stock
or declare or pay any dividends on its capital stock (other than dividends paid
in kind) or make any distribution or payment to shareholders, or set aside funds
for any such purpose. In addition, neither the Company nor any of its
Subsidiaries may make any payment in respect of, or defease or establish any
sinking fund related to, any Debt subordinated to the Notes and other
obligations under the Financing Documents or any seller notes or Debt
representing the deferred purchase price to be paid in connection with any
Acquisition, including, without limitation, the Nonpayable Subordinated Debt;
PROVIDED, that the Company and its Subsidiaries may make payments in respect of
Debt owing to (i) Xxxxxxx X. Xxxxxx, Xx., (ii) Xxxxx X. Xxxxxxx, Trustee for the
Xxxxx X. Xxxxxxx Revocable Living Trust, (iii) Xxxxxxx X. Xxxxx, Trustee for the
Xxxxxxx X. Xxxxx Trust, and (iv) W. Xxxxxx Xxxxx, in each case which is
subordinated to the Notes and other obligations under the Financing Documents
(collectively, the "PAYABLE SUBORDINATED DEBT"), which payments (A) may not
exceed $1,080,000 in the aggregate, (B) shall pay in full all principal,
interest and other obligations outstanding with respect to such Debt, and (C)
must be made in conjunction with the sale of assets by the Company or its
Subsidiaries to the holders of such Debt or their Affiliates. This Section
supersedes Section 7.4(a) of the Note Purchase Agreement.
(h) ASSET SALES. Notwithstanding the provisions of Section 7.6 of the Note
Purchase Agreement, the Company shall be permitted to consummate sales of the
assets described in the attached SCHEDULE I-A on the following terms and
conditions:
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(i) all such asset sales must be made for cash consideration only
and shall otherwise be on terms and conditions (including price) as
specified in SCHEDULE I-A; any deviation in price or any other material
term or condition shall require the consent of the Required Holders;
(ii) the Holders shall have received copies of the purchase and sale
documents (and all amendments and schedules thereto) certified by an
officer of the Company as being complete, true and correct at least three
Business Days in advance of the closing date of such sale (which period
may be shortened in the sole discretion of the Required Holders), and such
documents shall be in form and substance satisfactory to the Required
Holders in their sole reasonable discretion;
(iii) 90% (or, if a Triggering Event under the Intercreditor
Agreement shall have occurred and be continuing, 100%) of the Net Cash
Proceeds from Assets received from all such asset sales consisting of real
property assets located in (or related to) the Company's or its
Subsidiaries' operations in New Orleans, Louisiana, Portland, Oregon,
Aiken, South Carolina, or Richmond, Indiana shall, upon receipt, be
deposited with the Collateral Agent to be applied to the Indebtedness (as
defined in the Intercreditor Agreement) in accordance with the terms of
the Intercreditor Agreement, or if the Intercreditor Agreement shall have
been terminated and all Indebtedness has been repaid, such amounts shall
be returned to the Company and its Subsidiaries; and
(iv) 80% (or, if a Triggering Event under the Intercreditor
Agreement shall have occurred and be continuing, 100%) of the Net Cash
Proceeds from Assets received from all such asset sales consisting of
assets located in (or related to) the Company's or its Subsidiaries'
operations OTHER THAN those referred to in clause (iii) above shall, upon
receipt, be deposited with the Collateral Agent to be applied to the
Indebtedness (as defined in the Intercreditor Agreement), or if the
Intercreditor Agreement shall have been terminated, such amounts shall be
returned to the Company and its Subsidiaries.
All proceeds received from asset sales permitted by this Section 2(h) shall be
detailed in writing by the Company to the Collateral Agent and the Holders as to
which proceeds are attributable to sales of working capital assets, and which
proceeds are proceeds attributable to sales of non-working capital assets. All
proceeds of sales of assets (regardless of whether they are working capital
assets or non-working capital assets) that are paid to the Holders shall be
applied to prepayment of the outstanding principal amount of the Notes in
accordance with Section 4.2(a) or Section 4.2(b), as applicable, of the
Agreement.
The Company agrees that it shall consummate, or cause its Subsidiaries to
consummate, asset sales with respect to all or a portion of the asset sales
described in the attached SCHEDULE I-A to the extent necessary for the Company
(or its Subsidiaries ) to obtain on or before April 30, 2001 gross proceeds from
such asset sales in an amount equal to at least $10,000,000, and the
corresponding identified percentage of Net Cash Proceeds from Assets resulting
from such asset sales shall have been paid to the Collateral Agent by such date.
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No other asset sales or other Transfers shall be permitted other than those
described above and those described in clauses (a), (b), (c) and (d) of Section
7.6 of the Note Purchase Agreement. The Company has indicated a desire to sell
some or all of the assets listed on SCHEDULE I-B. Upon receipt of letters of
intent or other indication of commitment with respect to any of such assets the
Collateral Agent will discuss with representatives of the Company the terms and
conditions upon which the Collateral Agent may recommend to the Holders and the
Lenders under the Credit Agreement the release of Liens in favor of the Holders
and such Lenders.
Upon the sale, disposition or other Transfer of any asset permitted in
accordance with this Section 2(h) and so long as no Default or Event of Default
(other than the Existing Defaults) shall have occurred and be continuing (or
would be occasioned thereby), then the Collateral Agent shall be permitted to,
and shall, at the expense of the Company and without the consent of any Holder,
execute and deliver such releases or terminations (or similar instruments) as
may be reasonably necessary in order to consummate such sale, disposition or
Transfer.
(i) FINANCIAL COVENANTS. Notwithstanding the terms of the Note Purchase
Agreement, none of Sections 7.2, 7.13, 7.14 or 7.15 of the Note Purchase
Agreement shall apply for fiscal periods ending after the date of this Agreement
and on or before the end of the Forbearance Period. All other covenants
contained in the Note Purchase Agreement and the other Financing Documents
shall, subject to the modifications contained in this Agreement, remain in full
force and effect and must be complied with by the Company and its Subsidiaries.
Additionally, this Section 2(i) shall have no effect on the Existing Defaults
comprised of previous financial covenant breaches and such Existing Defaults
shall continue to exist, subject to the terms of this Agreement, during the
Forbearance Period.
(j) [INTENTIONALLY OMITTED.]
(k) LEASED PROPERTIES. If the Company or any of its Subsidiaries enters
into any operating lease or capital lease with any other Person, with the
Company or such Subsidiary being the lessor and such other Person being the
lessee, then the Company or such Subsidiary, as applicable, shall execute such
Security Documents and such other documents, agreements, certificates, opinions
or other instruments as the Collateral Agent may reasonably request in order to
cause the Collateral Agent to be satisfied that it has an Acceptable Security
Interest in such lease for the benefit of the Collateral Agent, the Holders, and
the Agent and the Lenders under the Credit Agreement.
(l) BANK ACCOUNTS. The Company shall cause its primary operating account
to be Account No. 00100281782 maintained with The Chase Manhattan Bank
("CONCENTRATION ACCOUNT"), and shall take all action reasonably necessary to
cause the Collateral Agent to have an Acceptable Security Interest in the
Concentration Account, and each of the Company and its Subsidiaries shall,
unless the Collateral Agent and the Required Holders agree otherwise, cause each
depository where their other bank accounts are maintained to executed and
deliver (within 30 days of their receipt thereof) a bank account agreement in
form and substance satisfactory to the Collateral Agent and the Required Holders
providing for, among other things, the grant of an
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Acceptable Security Interest in favor of the Collateral Agent in each such bank
account (and the amounts contained therein).
Section 3. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Holders as of the Effective Date as follows:
(a) ORGANIZATION, AUTHORIZATION, ETC. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and has all requisite power and authority to execute, deliver and
perform its obligations under this Agreement and the Note Purchase Agreement and
Notes (each as amended hereby). The execution and delivery of this Agreement and
the performance of this Agreement and the Note Purchase Agreement and Notes
(each as amended hereby) have been duly authorized by all necessary action on
the part of the Company. This Agreement and the Note Purchase Agreement and
Notes (each as amended hereby) are legal, valid and binding obligations of the
Company, enforceable against the Company in accordance with their respective
terms, except as enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights and remedies generally and (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(b) COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC. Except with respect to
payments by the Company in respect of the Nonpayable Subordinated Notes, which
are prohibited under Section 2(g) of this Agreement, the execution, delivery and
performance by the Company of this Agreement and the Note Purchase Agreement and
Notes (each as amended hereby) do not and will not (i) contravene, result in any
breach of, or constitute a default under, or result in the creation of any Lien
in respect of any property of the Company or any of its Subsidiaries under, an
indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease,
corporate charter or by-laws, or any other agreement or instrument to which the
Company or any of its Subsidiaries is bound or by which the Company or any of
its Subsidiaries or any of its properties may be bound or affected, (ii)
conflict with or result in a breach of any of the terms, conditions or
provisions of any order, judgment, decree, or ruling of any court, arbitrator or
Governmental Authority applicable to the Company or any of its Subsidiaries or
(iii) violate any provision of any statute or other rule or regulation of any
Governmental Authority applicable to the Company or any of its Subsidiaries.
(c) GOVERNMENTAL AUTHORIZATION, ETC. No consent, approval or authorization
of, or registration, filing or declaration with, any Governmental Authority is
required for the validity of the execution, delivery or performance by the
Company of this Agreement or the Note Purchase Agreement or Notes (each as
amended hereby).
(d) NO DEFAULT, ETC. Except as described in this Agreement, no Event of
Default or Default has occurred and is continuing, and except (i) as described
in the Forbearance Agreement and Consent dated as of even date herewith among
the Company, the Agent and the Lenders under the Credit Agreement (the "CREDIT
AGREEMENT FORBEARANCE AGREEMENT") with respect to certain Defaults or Events of
Default (as such terms are defined in the Credit
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Agreement) under the Credit Agreement, (ii) with respect to the Company's
failure to make payments of interest on the Nonpayable Subordinated Debt prior
to the Effective Date as and when the same became due and (iii) with respect to
the Company's failure to make payments of principal and interest on the Payable
Subordinated Debt prior to the Effective Date as and when the same became due,
neither the Company nor any of its Subsidiaries is in default (whether or not
waived) in the performance or observance of any of the terms, covenants or
conditions contained in any instrument evidencing any Indebtedness and there is
no pending request by the Company (except pursuant to this Agreement and the
Credit Agreement Forbearance Agreement) or any of its Subsidiaries for any
amendment or waiver in respect of any contemplated or possible default with
respect to such Indebtedness and no event has occurred and is continuing which,
with notice or lapse of time or both, would become such a default.
(e) NO UNDISCLOSED FEES. The Company has not, directly or indirectly, paid
or caused to be paid any consideration (as supplemental or additional interest,
a fee or otherwise) to any holder of Notes or other Indebtedness in order to
induce such holder to enter into this Agreement or give its forbearance and
consent as requested by the Credit Agreement Forbearance Agreement or take any
other action in connection with the transactions contemplated hereby or thereby,
nor has the Company agreed to make any such payment, except as contemplated by
the Credit Agreement Forbearance Agreement and Section 2(f) of this Agreement.
Section 4. REAFFIRMATION OF GUARANTORS. Each of the Guarantors hereby (a)
consents, acknowledges and agrees to the terms of this Agreement, (b) confirms
and agrees that the Subsidiary Guarantee to which it is a party is, and shall
continue to be, in full force and effect and is hereby confirmed, (c) represents
that it has no defenses to the enforcement of such Subsidiary Guarantee and (d)
ratifies such Subsidiary Guarantee in all respects. The execution and delivery
of this Agreement by the Guarantors and the ratification of the Subsidiary
Guarantees effected thereby does not indicate or establish a requirement that
such Subsidiary Guarantees require any Guarantor's approval of amendments to the
Note Purchase Agreement, but has been furnished to the Holders as a courtesy at
the request of the Holders.
Section 5. EFFECTIVENESS. This Agreement shall become effective, and the
amendments, consents and forbearance provisions provided for herein shall be
effective as provided herein, on the date (the "EFFECTIVE DATE") on which all of
the following conditions precedent shall have been satisfied:
(a) EXECUTED AGREEMENT. The Company and the Guarantors shall have
delivered duly and validly executed originals (unless otherwise indicated) of
this Agreement to the Purchaser;
(b) DOCUMENTS EVIDENCING AUTHORIZATION, ETC. The Company shall have
delivered to the Purchaser:
(i) copies, certified as of the date of this Agreement by a
Responsible Officer of the Company of (A) the resolutions of the Board of
Directors of the Company approving this Agreement, (B) the certificate of
incorporation and bylaws of the
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Company, and (C) all other documents evidencing other necessary corporate
action and governmental approvals, if any, with respect to this Agreement
and the other Financing Documents (PROVIDED that in lieu of delivering the
certified copies of the certificate of incorporation and bylaws of the
Company, such Responsible Officer may certify that the certified copies of
such documents delivered to the Purchaser in connection with the Second
Amendment dated as of May 12, 2000 remain in full force and effect and
have not been terminated amended, restated, supplemented or otherwise
modified since such earlier certification date); and
(ii) certificates of a Responsible Officer of each of the Company
and its Subsidiaries certifying the names and true signatures of officers
of each such Person authorized to sign this Agreement and the other
Financing Documents to which each such Person is a party.
(c) PROCEEDINGS. All proceedings taken by the Company and the Guarantors
in connection with the transactions contemplated hereby and all documents and
papers incident thereto shall be satisfactory to the Purchaser, and the
Purchaser and its special counsel shall have received all such counterpart
originals or certified or other copies of such documents and papers, all in form
and substance satisfactory to the Purchaser, as the Purchaser or its special
counsel may reasonably request in connection therewith.
(d) REPRESENTATIONS AND WARRANTIES. The representations and warranties of
the Company contained in Section 3 of this Agreement shall be true on and as of
the Effective Date as though such representations and warranties had been made
on and as of the Effective Date, and the Purchaser shall have received a
certificate of a senior financial officer of the Company, dated the Effective
Date, to such effect.
(e) OPINION OF COUNSEL. The Purchaser shall have received an opinion,
dated the Effective Date, addressed to the Purchaser and otherwise satisfactory
in form, scope and substance to the Purchaser and its special counsel, from
Xxxxx, Xxxxxxx & Xxxx LLP, covering such matters incident to the transactions
contemplated hereby as the Purchaser may reasonably request.
(f) CREDIT AGREEMENT CONSENT AND FORBEARANCE AGREEMENT. The Company shall
have delivered to the Purchasers duly and validly executed copies of (i) a
consent to this Agreement from the Administrative Agent and the Lenders under
the Credit Agreement and (ii) the Credit Agreement Forbearance Agreement, each
in form and substance satisfactory to the Purchaser, the conditions to
effectiveness thereof shall have been satisfied, and the Purchaser shall have
received copies of all certificates, legal opinions and other documentation
provided in connection with such effectiveness.
(g) PAYMENT OF FEES. The Company shall have paid to the Purchaser or its
special counsel, as applicable, the fees and disbursements contemplated by
Section 7 of this Agreement.
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(h) PAYMENT OF ACCRUED INTEREST. The Company shall have paid to the
Purchaser all accrued and unpaid interest on the Notes through (but not
including) the Effective Date, both as described in Section 2(a)(i)(B) of this
Agreement and arising as a result of the interest rate increases described in
Section 2(b) of this Agreement.
Section 6. EXCHANGE OR NOTATION OF NOTES. On or after the Effective Date
and in any case prior to any transfer of the Purchaser's outstanding Note, the
Purchaser shall either make a notation of the amendment to such Note pursuant to
this Agreement, or surrender such Note in exchange for a new Note in accordance
with Section 11.3 of the Note Purchase Agreement. Any Note executed and
delivered on or after the Effective Date shall be in the form of ANNEX A hereto.
Section 7. EXPENSES. Without limiting the generality of Section 13.1 of
the Note Purchase Agreement, the Company agrees, whether or not the transactions
contemplated hereby are consummated, to (a) pay the reasonable fees and
disbursements of Xxxxx Xxxxx L.L.P., the Purchaser's special counsel, for their
services rendered in connection with such transactions and with respect to this
Agreement and any other document delivered pursuant to this Agreement and (b)
reimburse the Purchaser for its reasonable out-of-pocket expenses in connection
with the foregoing.
Section 8. EFFECT ON FINANCING DOCUMENTS; ACKNOWLEDGMENTS AND AGREEMENTS.
(a) Except as amended hereby, the Note Purchase Agreement and the other
Financing Documents remain in full force and effect. Nothing herein shall act as
a waiver of any of the Collateral Agent's or the Holders' rights under the
Financing Documents.
(b) This Agreement is a Financing Document for the purposes of the
provisions of the other Financing Documents. Without limiting the foregoing, any
breach of representations, warranties, and covenants under this Agreement may be
a Default or Event of Default under other Financing Documents.
(c) THE COMPANY ACKNOWLEDGES THAT ON THE DATE HEREOF ALL OBLIGATIONS UNDER
THE FINANCING DOCUMENTS ARE PAYABLE WITHOUT DEFENSE, OFFSET, COUNTERCLAIM OR
RECOUPMENT. IN ADDITION, EACH OF THE COMPANY AND ITS SUBSIDIARIES (FOR
THEMSELVES AND THEIR RESPECTIVE SUCCESSORS, AGENTS, ASSIGNS, TRANSFEREES,
OFFICERS, DIRECTORS, EMPLOYEES, SHAREHOLDERS, ATTORNEYS AND AGENTS) HEREBY
RELEASES ANY AND ALL CLAIMS, CAUSES OF ACTION OR OTHER DISPUTES IT MAY HAVE
AGAINST THE COLLATERAL AGENT, ANY OF THE HOLDERS, LEGAL COUNSEL TO THE
COLLATERAL AGENT OR THE HOLDERS, CONSULTANTS HIRED BY ANY OF THE FOREGOING, OR
ANY OF THEIR RESPECTIVE AFFILIATES, SUBSIDIARIES, SHAREHOLDERS, AGENTS,
DIRECTORS, OFFICERS, EMPLOYEES, REPRESENTATIVES, SUCCESSORS OR ASSIGNS OF ANY
KIND OR NATURE ARISING OUT OF, RELATED TO, OR IN ANY WAY CONNECTED WITH, THE
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NOTE PURCHASE AGREEMENT OR THE OTHER FINANCING DOCUMENTS, IN EACH CASE WHICH MAY
HAVE ARISEN ON OR BEFORE THE DATE OF THIS AGREEMENT. THE COMPANY HEREBY
ACKNOWLEDGES THAT IT HAS READ THIS AGREEMENT AND HAS CONFERRED WITH ITS COUNSEL
AND ADVISORS REGARDING ITS CONTENT, INCLUDING THIS SECTION 8(C), AND IS FREELY
AND VOLUNTARILY ENTERING INTO THIS AGREEMENT, AND HEREBY AGREES TO WAIVE ANY
CLAIM THAT THE TERMS OF THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION, THE
RELEASES CONTAINED HEREIN) ARE INVALID OR OTHERWISE UNENFORCEABLE.
(d) THE HOLDERS HEREBY EXPRESSLY RESERVE ALL OF THEIR RIGHTS, REMEDIES,
AND CLAIMS UNDER THE FINANCING DOCUMENTS. EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT, NOTHING IN THIS AGREEMENT SHALL CONSTITUTE A WAIVER OR RELINQUISHMENT
(I) OF ANY DEFAULT OR EVENT OF DEFAULT (INCLUDING, WITHOUT LIMITATION, ANY
EXISTING DEFAULT) UNDER ANY OF THE FINANCING DOCUMENTS, (II) OF ANY OF THE
AGREEMENTS, TERMS OR CONDITIONS CONTAINED IN THE FINANCING DOCUMENTS, (III) OF
ANY RIGHTS OR REMEDIES OF THE COLLATERAL AGENT OR THE HOLDERS WITH RESPECT TO
THE FINANCING DOCUMENTS, OR (IV) OF THE RIGHTS OF THE COLLATERAL AGENT AND THE
HOLDERS TO COLLECT THE FULL AMOUNTS OWING TO THEM UNDER THE FINANCING DOCUMENTS.
Section 9. CHOICE OF LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Texas.
Section 10. COUNTERPARTS. This Agreement may be signed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
THIS WRITTEN AGREEMENT AND THE FINANCING DOCUMENTS, AS DEFINED IN THE NOTE
PURCHASE AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS.]
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EXECUTED as of the ___ day of January, 2001.
COMPANY AND GUARANTORS:
THE YORK GROUP, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
COLONIAL GUILD TRADE COMPANY, INC.
XXXXX VAULT TRADE COMPANY, INC.
XXXXX TRADE COMPANY, INC.
XXXXX XXXXX, INC.
XXXXX XXXXX TRADE COMPANY, INC.
OMC INDUSTRIES, INC.
PUGET SOUND CASKET CO.
STAR MANUFACTURING CORPORATION
THE XXXXX GROUP, INC.
T.Y.G. COMPANY, INC.
T.Y.G. TRADE COMPANY, INC.
T.Y.G. TRADE II COMPANY, INC.
WEST POINT CASKET COMPANY
XXXXX VAULT COMPANY, INC.
WEST POINT TRADE COMPANY, INC.
YORK AGENCY, INC.
YORK ACQUISITION CORP.
YORK BRONZE COMPANY
(For purposes of Sections 4 and 8 only)
By:_________________________________________
Name:_______________________________________
Title:______________________________________
PURCHASER:
THE VARIABLE ANNUITY LIFE INSURANCE
COMPANY
By:_________________________________________
Name:_______________________________________
Title:______________________________________
