AMENDMENT NO. 2 TO INTERCREDITOR AGREEMENT
Exhibit 10-3
AMENDMENT NO. 2 TO INTERCREDITOR AGREEMENT
THIS AMENDMENT NO. 2 TO INTERCREDITOR AGREEMENT (“Amendment”) dated as of May 19, 2006 is by
and between Wachovia Bank, National Association (as successor by merger to Congress Financial
Corporation) in its capacity as agent pursuant to the Working Capital Loan and Security Agreement
for the lenders who are party from time to time thereto (in such capacity, together with its
successors and assigns in such capacity, the “Working Capital Agent”) and Ableco Finance LLC, a
Delaware limited liability company, in its capacity as agent pursuant to the Term Loan and Security
Agreement for the lenders who are party from time to time thereto (in such capacity, together with
its successors and assigns in such capacity, the “Term Loan Agent”).
WITNESSETH:
WHEREAS, Working Capital Agent, Working Capital Lenders, Term Loan Agent and Term Loan Lenders
have previously entered into the Intercreditor Agreement, dated as of December 18, 2003 (the
“Intercreditor Agreement”); and
WHEREAS, Borrowers have requested certain amendments to Working Capital Loan Agreements,
including an increase in the principal amount of the LRG Term Loan outstanding under the Working
Capital Loan Agreements; and
WHEREAS, Working Capital Agent and Term Loan Agent desire to enter into this Amendment to
confirm that the terms and conditions of the Intercreditor Agreement, as amended hereby, shall
continue to be in full force and effect;
NOW THEREFORE, in consideration of the mutual benefits accruing to each of the parties to the
Intercreditor Agreement hereunder and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto do hereby agree as follows:
SECTION 1. Interpretation. For purposes of this Amendment, unless otherwise defined
herein, all capitalized terms used herein shall have the meaning given to them in the Intercreditor
Agreement.
SECTION 2. Additional Definitions to Intercreditor Agreement. As used herein, the
following terms shall have the meanings given to them below and the Intercreditor Agreement is
hereby amended to include, in addition and not in limitation, the following definitions:
2.1 “Amendment No. 8” shall mean Amendment No. 8 to Amended and Restated Loan and
Security Agreement, dated May 18, 2006, by and among Borrowers, Working Capital Agent and Working
Capital Lenders.
SECTION 3. Amendments to Intercreditor Agreement.
3.1 Maximum W/C Debt Section 1.12 of the Intercreditor Agreement is hereby deleted
and the following is substituted therefor:
“1.12 “Maximum W/C Debt” shall mean the sum of (a) the
aggregate outstanding principal amount of revolving loans and letter
of credit accommodations made or issued pursuant to the Working
Capital Loan Agreements up to a maximum amount equal to the lesser
of (i) $20,000,000 or (ii) the amount equal to (A) the Availability
multiplied by (B) 105% plus (b) the aggregate principal amount of
all Term Loans (as such term is defined in the Working Capital Loan
and Security Agreement) outstanding immediately after giving effect
to Amendment No. 8, as reduced by regularly scheduled payments and
prepayments of principal in respect thereof actually received by
Working Capital Agent and applied against the Term Loans (subject to
Section 2.20 of this Intercreditor Agreement); provided, that, the
portion of the aggregate outstanding principal amount of revolving
loans and letter of credit accommodations that are made or issued
pursuant to the Working Capital Loan and Security Agreement but that
are not made or issued intentionally or with actual knowledge that
such revolving loans and letter of credit accommodations cause the
aggregate outstanding principal amount of revolving loans and letter
of credit accommodations to exceed the amount equal to the
Availability multiplied by 105% (but do not exceed $20,000,000)
calculated at the time made or issued shall be included, together
with interest, fees, indemnities, costs and expenses arising under
the Working Capital Loan Agreements, in the term “Maximum W/C Debt”
as used herein.”
SECTION 4. Amendment No. 8. Term Loan Agent hereby acknowledges that it has received
and reviewed a copy of Amendment No. 8, and to the extent Term Loan Agent’s consent is or may be
required under the Intercreditor Agreement, Term Loan Agent hereby consents to the terms and
provisions as set forth in Amendment No. 8. The agreement of Term Loan Agent herein should not be
construed to require that Agent seek or imply that Agent is required to obtain the consent or
agreement of Term Loan Agent as to any other matter or that Term Loan Agent is entitled to consent
or agree to any other matter. Notwithstanding any prohibition set forth in Section 2.20 of the
Intercreditor Agreement with respect to amendments to the Working Capital Loan Agreements, Term
Loan Agent, by its signature below, consents to the increase in the principal amount of the LRG
Term Loan (as such term is defined in the Working Capital Loan and Security Agreement, after giving
effect to Amendment No.8) and the modification of the due dates of principal payments in respect
thereof, as set forth in Amendment No.8.
SECTION 5. General
5.1 Effect of this Amendment. Except as modified pursuant hereto, no other changes or
modifications to the Intercreditor Agreement are intended or implied, and in all other respects,
the Intercreditor Agreement is hereby specifically ratified, restated and confirmed by the parties
hereto as of the effective date hereof. To the extent of conflict between the terms of
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this Amendment and the Intercreditor Agreement, the terms of this Amendment shall control. The
Intercreditor Agreement and this Amendment shall be read as one agreement.
5.2 Further Assurances. The parties hereto shall execute and deliver such additional
documents and take such additional actions, in each case, as may be reasonably necessary to
effectuate the provisions and purposes of this Amendment.
5.3 Governing Law. The rights and obligations hereunder of each of the parties hereto
shall be governed by and interpreted and determined in accordance with the laws of the State of New
York (without giving effect to principles of conflicts of laws).
5.4 Binding Effect. This Amendment shall be binding upon and inure to the benefit of
each of the parties hereto and their respective successors and assigns.
5.5 Counterparts. This Amendment may be executed in any number of counterparts, but
all of such counterparts shall together constitute but one and the same agreement. In making proof
of this Amendment, it shall not be necessary to produce or account for more than one counterpart
thereof signed by each of the parties thereto.
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IN WITNESS WHEREOF, the parties have caused this Amendment No.1 to Intercreditor Agreement to
be duly executed as of the day and year first above written.
| WORKING CAPITAL AGENT | ||||||
| WACHOVIA BANK, NATIONAL | ||||||
| ASSOCIATION | ||||||
| By: | /s/ Xxxxxxx X. Xxxx
|
|||||
| Title: VP | ||||||
| TERM LOAN AGENT | ||||||
| ABLECO FINANCE LLC | ||||||
| By: | /s/ Xxx Xxxx
|
|||||
| Title: SVP | ||||||
ACKNOWLEDGED AND AGREED:
LEXINGTON PRECISION CORPORATION
By:
|
/s/ Xxxxxx Xxxxxx
|
|||
| Title: President | ||||
LEXINGTON RUBBER GROUP, INC.
By:
|
/s/ Xxxxxx Xxxxxx
|
|||
| Title: President | ||||
