EXHIBIT 4.11
SECOND AMENDMENT dated as of
December 21, 2001, (this "Amendment") to the FIVE-
YEAR CREDIT AGREEMENT dated as of October 28, 1999
(as amended, restated, supplemented or otherwise
modified from time to time, the "Five-Year Credit
Agreement"), among CROMPTON CORPORATION (formerly
known as CK Witco Corporation) (the "Company"); the
Eligible Subsidiaries referred to therein; the
BANKS referred to therein; JPMORGAN CHASE BANK
(formerly known as THE CHASE MANHATTAN BANK)
("JPMORGAN"), as Syndication Agent; CITICORP USA,
INC. (as successor to Citibank, N.A. in its
capacity as Administrative Agent), as
Administrative Agent; and BANK OF AMERICA, N.A. and
DEUTSCHE BANC ALEX. XXXXX INC. (formerly known as
DEUTSCHE BANK SECURITIES INC.), as Co-Documentation
Agents.
WHEREAS, the Company, the Eligible
Subsidiaries, the Banks, the Co-Documentation
Agents, the Syndication Agent and the
Administrative Agent are parties to the Five-Year
Credit Agreement;
WHEREAS, pursuant to the Five-Year Credit
Agreement, the Banks have made and agreed to make
certain loans to the Borrowers; and
WHEREAS, the Company has requested that
certain provisions of the Five-Year Credit
Agreement, the Five-Year Subsidiary Guarantee
Agreement and the Five-Year Indemnity, Subrogation
and Contribution Agreement be modified in the
manner provided in this Amendment;
WHEREAS, the Banks whose signatures
appear below, constituting the Required Banks,
hereby agree to amend the Five-Year Credit
Agreement, which amendment shall become effective
upon satisfaction of the conditions precedent set
forth herein, the Five-Year Subsidiary Guarantee
Agreement and the Five-Year Indemnity, Subrogation
and Contribution Agreement;
WHEREAS, the Banks whose signatures
appear below, constituting the Required Banks,
desire to appoint Citicorp USA, Inc., as
Administrative Agent and as Collateral Agent, and
the Loan Parties desire to consent to such
appointments;
NOW, THEREFORE, in consideration of the
mutual agreements herein contained and other good
and valuable consideration, the sufficiency and
receipt of which are hereby acknowledged, the
parties hereto hereby agree as follows:
SECTION 1. Defined Terms. Capitalized
terms used but not defined herein have the meanings
assigned to them in the Five-Year Credit Agreement
and the Security Agreement.
SECTION 2. Amendment of Section 1.01.
(a) Section 1.01 of the Five-Year Credit Agreement
is hereby amended by inserting the following
defined terms in their correct alphabetical order:
"Amendment No. 1" means the First
Amendment dated as of September 24, 2001, to this
Agreement.
"Amendment No. 2" means the Second
Amendment dated as of December 21, 2001, to this
Agreement.
"Amendment No. 2 Effective Date" means
the date on which Amendment No. 2 became effective.
"Base Rate Margin" means a rate per annum
determined in accordance with the Pricing Schedule.
"CNTA Baskets" means the baskets under
the Indentures equal to 10% of Consolidated Net
Tangible Assets under which obligations and
Indebtedness (as defined in the Indentures) not
otherwise permitted by Section 3.3 of the Crompton
Indenture and Section 1008 of the Witco Indenture
are permitted to be secured and sale and leaseback
transactions not otherwise permitted by Section 3.4
of the Crompton Indenture and Section 1009 of the
Witco Indenture are permitted to be entered into
without the ratable securing of the Company's
obligations under the Indentures.
"Collateral" has the meaning set forth in
the Security Agreement.
"Collateral Agent" means Citicorp USA,
Inc., in its capacity as collateral agent for the
Banks.
"Collateral Release" has the meaning set forth in
Section 11.12.
"Collateral Requirement" means, at any
time, that (a) the Security Agreement (or a
supplement thereto) shall have been duly executed
and delivered by the Company and by each of the
Designated Subsidiaries existing at such time, (b)
each Grantor shall have executed and delivered to
the Collateral Agent (i) an appropriate UCC
financing statement, identifying the Collateral of
such Grantor subject to the Lien of the Security
Agreement and naming the Collateral Agent as
secured party, for filing in the central filing
office of the jurisdiction of organization of such
Grantor and (ii) any other financing statements or
continuation statements required under applicable
law or requested by the Collateral Agent to ensure
that the Security Agreement creates a valid and
perfected security interest in all the Collateral
in which a security interest can be perfected under
the Uniform Commercial Code as in effect in each
applicable jurisdiction; provided, that no fixture
filings shall be required with respect to any
portion of the Collateral constituting fixtures.
"Consolidated Net Tangible Assets" means
the total consolidated assets of the Company and
its Subsidiaries (as such term is defined in the
Indentures), less (a) current liabilities of the
Company and its Subsidiaries; (b) all depreciation
and valuation reserves and all other reserves
(except (x) reserves for contingencies which have
not been allocated to any particular purpose, and
(y) deferred credits, including deferred federal
and foreign income taxes and deferred investment
tax credits) of the Company and its Subsidiaries;
(c) the net book amount of all intangible assets of
the Company and its Subsidiaries, including the
unamortized portions of such items as goodwill,
trademarks, trade names, patents and debt discount
and expense less debt premium; and (d) appropriate
adjustments on account of minority interests of
other Persons holding stock in the Subsidiaries.
"Crompton Indenture" means the Indenture
dated as of March 1, 2000, between the Company
(then known as CK Witco Corporation) and Citibank,
N.A., as trustee.
"Crompton Indenture Obligations" means
the obligations of the Company under the Crompton
Indenture.
"Designated Subsidiaries" means all
Domestic Subsidiaries of the Company other than
Domestic Subsidiaries that, taken together, (a)
have assets with an aggregate book value equal to
less than 15% of the aggregate book value of the
total assets of the Company and the Domestic
Subsidiaries and (b) have revenues for the most
recently ended fiscal quarter equal to less than
15% of the total revenues of the Company and the
Domestic Subsidiaries for such fiscal quarter.
"Equity Interest" means shares of capital
stock, partnership interests, membership interests
in a limited liability company, beneficial
interests in a trust or other equity ownership
interests in a Person.
"Financial Officer" of any Person shall
mean the chief financial officer, the treasurer or
the principal accounting officer of such Person.
"Grantors" means the Company and the
Subsidiary Grantors.
"Indentures" means the Crompton Indenture
and the Witco Indenture.
"Obligations" has the meaning set forth
in the Security Agreement.
"Perfection Certificate" means a
certificate in the form of Exhibit O or any other
form approved by the Collateral Agent.
"Release Date" has the meaning set forth in
Section 11.12 hereof.
"Release Conditions" has the meaning set forth in
Section 11.12 hereof.
"Secured Parties" means the
Administrative Agent, the Collateral Agent, each
Bank, the Issuing Bank and each other person to
which any of the Obligations is owed.
"Security Agreement" means a Security
Agreement substantially in the form of Exhibit N
hereto.
"Security Documents" means the Security
Agreement, the Subsidiary Guarantee Agreement and
the Indemnity, Subrogation and Contribution
Agreement.
"Subsidiary Grantors" has the meaning
set forth in the Security Agreement.
"Type", when used in reference to any
Loan or Borrowing, refers to whether the rate of
interest on such Loan, or on the Loans comprising
such Borrowing, is determined by reference to the
Adjusted London Interbank Offered Rate, the
Adjusted CD Rate or the Base Rate.
"Witco Indenture" means the
Indenture dated as of February 1, 1996, between the
Company (then known as Witco Corporation) and The
Chase Manhattan Bank, as trustee.
(b) Section 1.01 of the Five-Year Credit
Agreement is hereby further amended by deleting the
definitions of "364-Day Agreement", "Administrative
Agent", "Agents", "Fixed Rate Loans", "Loan
Documents", "Loan Parties" and "Money Market LIBOR
Loan" in their entirety and replacing them as
follows:
"364-Day Agreement" means the 364-Day
Credit Agreement dated as of October 28, 1999, as
amended and restated in the form of the Amended and
Restated Credit Agreement as of September 24, 2001
and as may be further amended, restated,
supplemented or otherwise modified from time to
time, among the Company, the Eligible Subsidiaries
referred to therein, the Banks listed therein,
JPMorgan Chase Bank (formerly known as the Chase
Manhattan Bank) ("JPMorgan"), as Syndication Agent,
Citibank, N.A., as Administrative Agent, and Bank
of America, N.A., as Documentation Agent.
"Administrative Agent" means Citicorp
USA, Inc., in its capacity as administrative agent
for the Banks hereunder, and its successors in such
capacity.
"Agents" means the Administrative Agent,
the Syndication Agent, the Collateral Agent and the
CoDocumentation Agents, and "Agent" means any of
the foregoing.
"Fixed Rate Loans" means CD Loans or Euro-
Dollar Loans or Money Market Loans (excluding Money
Market LIBOR Loans bearing interest at the rate
applicable to Base Rate Loans pursuant to Section
8.01) or any combination of the foregoing.
"Loan Documents" means this Agreement and
the Security Documents.
"Loan Parties" means the Company, the other
Borrowers, the Subsidiary Guarantors and the
Subsidiary Grantors.
"Money Market LIBOR Loan" means a loan to
be made by a Bank pursuant to a LIBOR Auction
(including such a loan bearing interest at the rate
applicable to Base Rate Loans pursuant to Section
8.01).
SECTION 3. Amendment of Article 2.
(a) Section 2.02 of the Five-Year Credit Agreement
is hereby amended by deleting the word "and" prior
to clause (iv) thereof, deleting the "." at the end
of clause (iv) thereof and replacing it with ",
and" and inserting immediately following clause
(iv) thereof the following:
"(v) executed by an assistant treasurer or a
Financial Officer.";
(b) Section 2.03(b) of the Five-Year
Credit Agreement is hereby amended by inserting
immediately following the words "Exhibit E hereto"
the following:
"and executed by an assistant treasurer or a
Financial Officer.";
(c) Section 2.06 of the Five-Year Credit
Agreement is hereby amended to read as follows:
"SECTION 2.06. Maturity of Loans. Each
Committed Loan included in any Borrowing shall
mature, and the principal amount thereof shall
be due and payable, on the Termination Date.
In the case of any Committed Loan that is a
Euro-Dollar Loan, CD Loan or Base Rate Loan,
upon the expiration of any Interest Period
applicable thereto, the Borrower may continue
such Loan as a Loan of the same Type or
convert the Loan into a Loan of a different
Type, in each case in accordance with the
notice requirements set forth in Section 2.02
and subject to the minimum principal amount
requirements set forth in Section 2.01;
provided, that, no Loan may be continued or
converted with an Interest Period ending after
the Termination Date. If the Borrower shall
not have given timely notice to continue or
convert any Loan, such Loan shall
automatically be converted into or continued
as a Base Rate Loan with an Interest Period of
30 days' duration. Each Money Market LIBOR
Loan and Money Market Absolute Rate Loan shall
mature, and the principal amount thereof shall
be due and payable, on the expiration of the
Interest Period applicable thereto.";
(d) Section 2.07(a) of the Five-Year
Credit Agreement is hereby amended to read as
follows:
"(a) Each Base Rate Loan shall bear
interest on the outstanding principal amount
thereof, for each day from the date such Loan
is made until it becomes due, at a rate per
annum equal to the sum of the Base Rate Margin
for such day plus the Base Rate for such day.
Such interest shall be payable for each
Interest Period on the last day thereof. Any
overdue principal of or interest on any Base
Rate Loan shall bear interest, payable on
demand, for each day until paid at a rate per
annum equal to the sum of 2% plus the rate
otherwise applicable to Base Rate Loans for
such day.";
(e) Section 2.07(e) is hereby amended by
replacing the last sentence thereof with:
"Any overdue principal of or interest on
any Money Market Loan shall bear interest, payable
on demand, for each day until paid at a rate per
annum equal to the sum of 2% plus the rate
applicable to Base Rate Loans for such day.";
(f) Section 2.11(a) of the Five-Year
Credit Agreement is hereby amended by inserting the
words "rate applicable to" prior to the words "Base
Rate" and inserting the word "Loans" immediately
after the words "Base Rate" in the parenthetical
thereto;
(g) Section 2.11(f) of the Five-Year
Credit Agreement is hereby amended to read as
follows:
"(f) In the event and on each occasion
that the Company or any Subsidiary shall
complete any Asset Sale, the Company shall (i)
promptly deliver to the Administrative Agent a
certificate executed by a
Financial Officer of the Company describing
the assets sold and setting forth the
aggregate amount of Net Cash Proceeds received
or to be received and the calculation thereof,
and (ii) if the Required Leverage Ratio is
greater than 3.50 to 1.00, not later than the
third Business Day following any receipt by
the Company or any Subsidiary of Net Cash
Proceeds with respect to such Asset Sale,
ratably prepay Loans and loans outstanding
under the 364-Day Credit Agreement in
accordance with the outstandings thereunder in
an amount equal to 100% of such Net Cash
Proceeds.";
(h) Section 2.18(a) of the Five-Year
Credit Agreement is hereby amended by inserting
immediately following the last sentence the
following:
"Any such application for a Letter-of-
Credit shall be signed by an assistant
treasurer or a Financial Officer.";
(i) Section 2.18(b) of the Five-Year
Credit Agreement is hereby amended by deleting the
amount "$50,000,000" in the last sentence thereof
and replacing it with the amount "$100,000,000".
SECTION 4. Amendment of Article 4.
(a) Section 4.02 of the Five-Year Credit Agreement
is hereby amended by adding immediately prior to
the period at the end thereof the following words:
", except Liens created under the Loan
Documents";
(b) Section 4.09 of the Five-Year Credit
Agreement is hereby amended by deleting the words
"the Company's Material Subsidiaries" and inserting
"each Loan Party" in their place;
(c) Section 4.10 of the Five-Year Credit
Agreement is hereby amended by deleting the words
"The Company" therein and replacing them with the
following "Each of the Loan Parties"; and
(d) Article 4 of the Five-Year Credit Agreement
is hereby amended by adding the following Sections
at the end of that Article:
"SECTION 4.13. Collateral; Security
Agreement. (a) The Collateral is not subject
to any Liens other than Liens permitted by
Section 5.08. On the Amendment No. 2
Effective Date, the aggregate amount of the
Debt and other obligations (other than the
Obligations) secured by Liens on the
Collateral does not exceed $50,000,000, none
of which has used any portion of the CNTA
Baskets.
(b) The Security Agreement, when
executed and delivered by the parties thereto,
will be effective to create in favor of the
Collateral Agent, for the ratable benefit of
the Secured Parties, legal, valid and
enforceable security interests in the
Collateral (as defined in the Security
Agreement), and upon the filing of the
financing statements referred to in the
definition of "Collateral Requirement", such
security interests will constitute fully
perfected security interests in all right,
title and interest of each Grantor in such
Collateral, in each case prior and superior to
the rights of any other Person other than
Liens permitted under Section 5.08 of each of
this Agreement and the 364-Day Credit
Agreement. On the Amendment No. 2 Effective
Date and at all times thereafter when any Bank
has any Commitment or LC Exposure hereunder or
any LC Disbursement remains
unreimbursed or any of the Obligations remains
unpaid, the Collateral Requirement will have
been satisfied.
SECTION 4.14. CNTA Basket. The
CNTA Baskets are fully available on the
Amendment No. 2 Effective Date to permit the
securing of the Obligations as and to the
extent provided in the Security Agreement.".
SECTION 5. Amendment of Article 5.
(a) Section 5.01(c) of the Five-Year Credit
Agreement is hereby amended by deleting the word
"and" prior to clause (ii), replacing it with a
comma and inserting immediately before the
semicolon at the end thereof the following:
"and (iii) setting forth a calculation in
reasonable detail of Consolidated Net Tangible
Assets and of the CNTA Baskets as of the date
of the balance sheet included in such
financial statements";
(b) Section 5.07(a) of the Five-Year
Credit Agreement is deleted in its entirety and
replaced with the following:
"(a) The Company will not permit the
Leverage Ratio at any time during any period
beginning on a date set forth below and ending
on a date immediately preceding the date
listed immediately below such beginning date
(if any) to be in excess of the ratio set
forth below opposite such initial date:
Date Ratio
October 1, 2001 5.25 to 1.00
October 1, 2002 4.75 to 1.00
January 1, 2003 4.00 to 1.00
January 1, 2004 3.50 to 1.00
provided, if the Company and the Subsidiaries
have received at least $100,000,000 in Net
Cash Proceeds from Asset Sales after the
Amendment No. 2 Effective Date, the Leverage
Ratio required to be maintained at any time
thereafter shall be the greater of (i) 3.50 to
1.00 and (ii) the appropriate covenant level
as set forth above minus 0.25 for each
$100,000,000 increment above the initial
$100,000,000 in Net Cash Proceeds received
from Asset Sales after the Amendment No. 2
Effective Date.";
(c) Section 5.07(b) of the Five-Year
Credit Agreement is hereby amended by deleting it
in its entirety and replacing it with the
following:
"(b) The Company will not permit the
Interest Coverage Ratio for any four-fiscal
quarter period ending on or after any date set
forth below and prior to the date listed
immediately below such beginning date (if any)
to be less than the ratio set forth below
opposite such initial date:
Date Ratio
December 31, 2001 2.50 to 1.00
December 31, 2002 2.75 to 1.00
December 31, 2003 3.00 to 1.00";
(d) Section 5.07 of the Five-Year Credit
Agreement is hereby amended by the insertion at the
end thereof of the following new paragraph (c):
"(c) The Company will not permit
the book value of the Collateral (excluding
any Collateral that shall be subject to any
Lien other than the Lien of the Security
Agreement) to be less at any time than
$350,000,000.";
(e) Section 5.08 of the Five-Year Credit
Agreement is hereby amended by deleting the word
"or" at the end of clause (g) thereof deleting the
"." at the end of clause (h) and adding the
following language immediately after clause (h)
thereof:
"; or (i) Liens created under the Security
Agreement.";
(f) Section 5.11 of the Five-Year Credit
Agreement is hereby deleted in its entirety and
replaced with the following:
"SECTION 5.11. Additional Subsidiaries.
The Company will ensure at all times that all
Designated Subsidiaries are (or become within
30 Domestic Business Days of being formed or
acquired or becoming Designated Subsidiaries)
Subsidiary Guarantors."; and
(g) Article 5 of the Five-Year Credit
Agreement is hereby amended by adding the following
sections at the end thereof:
"SECTION 5.13. Prohibition on Guarantees
by Crompton Manufacturing Company, Inc. The
Company will not cause and will not permit
Crompton Manufacturing Company, Inc. (formerly
known as Uniroyal Manufacturing Company, Inc.)
or any successor to guarantee any Debt of the
Company other than the Obligations.
SECTION 5.14. Covenants Relating to
Collateral. (a) The Company will, and will
cause each Subsidiary Grantor to, execute,
acknowledge and deliver to the Collateral
Agent any and all further completed UCC
financing statements, and take all such
further actions, as may be required under any
applicable law or reasonably requested by the
Collateral Agent or the Required Banks to
ensure that the Collateral Requirement will be
and remain satisfied at all times, all at the
expense of the Company. The Company also
agrees to provide to the Collateral Agent from
time to time upon reasonable request evidence
reasonably satisfactory to the Collateral
Agent as to the perfection and priority of the
Liens created or intended to be created by the
Security Agreement.
(b) The Company will furnish to the
Collateral Agent written notice at least five
business days prior to the effectiveness of
any change (i) in any Loan Party's corporate
name, (ii) in the jurisdiction of organization
of any Loan Party, (iii) in any Loan Party's
identity or corporate structure, (iv) in any
Loan Party's organizational identification
number or (v) in any Loan Party's Federal
Taxpayer Identification Number. The Company
agrees not to effect or permit any change
referred to in the preceding sentence unless
all filings that are required in order for the
Collateral Agent to continue at all times
following such change to have a valid, legal
and perfected security interest in all the
Collateral have been made. The Company also
agrees promptly to notify the Collateral Agent
if any material portion of the Collateral is
damaged or destroyed.
(c) Each year, at the time of delivery
of annual financial statements with respect to
the preceding fiscal year pursuant to clause
(a) of Section 5.01, the Company will deliver
to the Collateral Agent a certificate executed
by a Financial Officer of the Company setting
forth the information required pursuant to the
Perfection Certificate or confirming that
there has been no change in such information
since the date of the Perfection Certificate
delivered on the Amendment No. 2 Effective
Date or the date of the most recent
certificate delivered pursuant to this
Section.
SECTION 5.15. Use of CNTA Baskets. The
Company will not and will not permit any of
its Subsidiaries to enter into any transaction
other than the transactions provided for in
this Agreement, the 364-Day Credit Agreement
and the Security Agreement that would utilize
any portion of the CNTA Baskets.
SECTION 5.16. Amendment of Indentures.
The Company will not amend either of the
Indentures in a manner adverse to the rights
or interests of the Banks."
SECTION 6. Amendment of Article 6.
Section 6.01 of the Five-Year Credit Agreement is
hereby amended by (a) replacing the word "or"
immediately before the words "any Material
Subsidiary" with a comma and inserting the words
"or any Designated Subsidiary" immediately after
the words "any Material Subsidiary" in clause (g)
thereof;
(b) replacing the word "or" immediately
before the words "any Material Subsidiary"
with a comma and inserting the words "or any
Designated Subsidiary" immediately after the
words "any Material Subsidiary", in each case,
in both instances in clause (h) thereof;
(c) replacing the word "or" immediately
before the words "any Material Subsidiary"
with a comma and inserting the words "or any
Designated Subsidiary" immediately after the
words "any Material Subsidiary" in clause (j)
thereof;
(d) deleting the word "or" at the end of
clause (k) thereof, inserting the word "or" at
the end of paragraph (l) thereof and inserting
the following immediately below such paragraph
(l):
"(m) at any time beginning with the
Amendment No. 2 Effective Date and prior to
the Collateral Release, any Lien purported to
be created under the Security Agreement with
respect to any portion of the Collateral shall
cease to be, or shall be asserted by any Loan
Party not to be, (i) a valid, perfected Lien
on such Collateral or (ii) a first priority
Lien (except to the extent of Liens permitted
under Section 5.08 and in existence on the
Amendment No. 2 Effective Date), in each case
except as a result of the sale, lease,
transfer or other disposition of the
applicable Collateral in a transaction
permitted under the Loan Documents or pursuant
to Section 11.12".
SECTION 7. Amendment of Article 7.
Section 7.05 of the Five-Year Credit Agreement is
hereby amended by inserting the following at the
end thereof:
"It is understood and agreed that
the Collateral Agent shall not be responsible
to any Lender for the due execution, legality,
validity, enforceability, genuineness,
sufficiency or value of or the perfection or
priority of any lien or security interest
created or purported to be created under or in
connection with, this Agreement or any
instrument or document furnished pursuant
hereto.".
SECTION 8. Amendment of Article 8.
Section 8.01(c) of the Five-Year Credit Agreement
is hereby amended by inserting the words "rate
applicable to" prior to the words "Base Rate" and
inserting the word "Loans" immediately after the
words "Base Rate" in clause (ii) thereto.
SECTION 9. Amendment of Article 11.
(a) Section 11.01 of the Five-Year Credit
Agreement is hereby amended by:
(i) inserting in clause (b) immediately
after the words "Administrative Agent" the
words "or the Collateral Agent"; and
(ii) inserting the following sentence at
the end thereof: "Each notice required to be
given by the Administrative Agent or by the
Required Banks under this Agreement, other
than any notice under Article 2 or Section
11.06, shall simultaneously be given to the
Collateral Agent.";
(b) Section 11.03 of the Five-Year
Credit Agreement is hereby amended by inserting the
following clauses (c) and (d) thereof:
"(c) To the extent permitted by
applicable law, no Borrower shall assert, and
each hereby waives, any claim against any
Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive
damages (as opposed to direct or actual
damages) arising out of, in connection with,
or as a result of, this Agreement or any
agreement or instrument contemplated hereby,
any Loan or Letter of Credit or the use of the
proceeds thereof.
(d) All amounts due under this Section
shall be payable promptly after written demand
therefor.";
(c) Section 11.04 of the Five-Year Credit
Agreement is hereby amended by
(i) deleting the title of that
Section and replacing it with "Right of Set-
off; Sharing of Setoffs." and
(ii) inserting immediately prior to
the first sentence thereof the following:
"(a) If an Event of Default shall
have occurred and be continuing, each Bank and
each of its Affiliates is hereby authorized at
any time and from time to time, to the fullest
extent permitted by law, to set off and apply
any and all deposits (general or special, time
or demand, provisional or final) at any time
held and other obligations at any time owing
by such Bank or Affiliate to or for the credit
or the account of the Company or any Loan
Party against any of and all the obligations
of the Borrowers now or hereafter existing
under this Agreement held by such Bank,
irrespective of whether or not such Bank shall
have made any demand under this Agreement and
although such obligations may be unmatured.
The rights of each Bank under this Section
11.04(a) are in addition to other rights and
remedies (including other rights of setoff)
which such Bank may have.
(b)";
(d) Section 11.05 of the Five-Year Credit
Agreement is amended by deleting the word "or" in
front of (vi), replacing it with a comma and
inserting the following language immediately
following clause (vi) thereof:
"or (vii) release all or substantially
all the Collateral from the Lien of the
Security Agreement without the written consent
of each Bank except as expressly provided in
this Agreement or the Security Agreement"; and
(e) Article 11 of the Five-Year Credit
Agreement is hereby amended by adding the following
section at the end thereof:
"SECTION 11.12. Release of Grantors and
Collateral. (a) Notwithstanding any contrary
provision herein or in any other Loan
Document, if the Company shall request the
release under the Security Agreement of (i)
any Collateral that has been sold to any
Person other than the Company or any
Subsidiary, or (ii) any Collateral of any
Subsidiary Grantor in which the Company or any
Subsidiary owns all the equity interests,
which Collateral shall have been sold to any
Person other than the Company or any
Subsidiary, in either case in a transaction
permitted under the terms of the Loan
Documents, and shall deliver to the Collateral
Agent a certificate to the effect that such
sale will comply with the terms of the Loan
Documents, the Collateral Agent, if satisfied
that the applicable certificate is correct,
shall, without the consent of any Bank,
execute and deliver all such releases or other
instruments, and take all such further
actions, as shall be necessary to effectuate
the release of
such Collateral.
(b) Notwithstanding Section 5.14 or any other
provision herein or in any other Loan Document, the
Collateral Agent is hereby authorized and directed
to release (the "Collateral Release") the
Collateral and the proceeds thereof from the Liens
created by the Security Agreement (the "Collateral
Release") on a Business Day specified by the
Company (the "Release Date"), upon the satisfaction
of the following conditions precedent (the "Release
Conditions"):
(A) the Company shall have given notice
to the Collateral Agent at least 30 days prior
to the Release Date, specifying the proposed
Release Date and electing to reinstate,
effective as of the Release Date, the
covenants set forth in Section 5.07 of this
Agreement as in effect immediately prior to
the effectiveness of Amendment No. 1 (and on
the Release Date such covenants shall be
permanently reinstated as provided below);
(B) the Company shall have a Leverage
Ratio less than or equal to 3.50 to 1.00 as of
the Release Date and as of the last day of
each of the two fiscal quarters most recently
ended prior to the Release Date for which
financial statements shall have been delivered
pursuant to Section 5.01(a) or (b) and shall
be in compliance as of the Release Date and as
of the last day of each of such two fiscal
quarters with the other covenants and
agreements set forth in this Agreement, giving
effect to the reinstatement of the covenants
set forth in Section 5.07 as provided in
paragraph (A) above as if such reinstatement
had occurred prior to the last day of the
earlier of such two fiscal quarters;
(C) no Default or Event of Default shall
have occurred and be continuing as of the
Release Date; and
(D) on the Release Date, the
Administrative Agent and the Collateral Agent
shall have received a certificate, dated the
Release Date and executed on behalf of the
Company by a Financial Officer thereof,
confirming the satisfaction of the Release
Conditions set forth in clauses (B) and (C)
above and shall be satisfied that the
certifications contained therein are accurate.
Any such release shall be without recourse to, or
representation or warranty by, the Collateral Agent
and shall not require the consent of any Bank.
Subject to the satisfaction of the conditions set
forth in this paragraph (b), on and after the
Release Date, the Collateral Agent shall execute
and deliver all such instruments, releases,
financing statements or other agreements, and take
all such further actions, as shall be necessary to
effectuate the release of Collateral required by
this paragraph.
(c) On the Release Date, (i) Articles 2, 4
and 5 of this Agreement shall be automatically and
permanently amended by the deletion therefrom of
Sections 2.11(f), 4.13, 4.14, 5.13, 5.14 and 5.15,
and (ii) (A) Section 4.02 and (B) Sections
5.01(c), 5.07 and 5.08 of this Agreement shall be
automatically and permanently amended so that the
representations and covenants, respectively set
forth therein shall be those in effect immediately
prior to the effectiveness of Amendment No. 1.
(d) Without limiting the provisions of
Section 11.03, the Borrowers shall reimburse the
Collateral Agent for all costs and expenses,
including attorneys' fees and disbursements,
incurred by it in connection with any action
contemplated by this Section 11.12."
SECTION 10. Amendment of Schedules and
Exhibits. (a) The Pricing Schedule attached to the
Five-Year Credit Agreement is hereby replaced in
its entirety with the Pricing Schedule attached
hereto.
(b) Exhibit K of the Five-Year Credit
Agreement is hereby amended by deleting the first
sentence of Section 19 thereof and replacing it
with the following:
"Pursuant to Section 5.11 of the Credit
Agreement, the Company must ensure at all
times that all Designated Subsidiaries are (or
become within 30 Domestic Business Days of
being formed or acquired or becoming
Designated Subsidiaries) Subsidiary
Guarantors.".
(c) Exhibit L of the Five-Year Credit
Agreement is hereby amended by deleting the first
sentence of Section 11 thereof and replacing it
with the following:
"Pursuant to Section 5.11 of the Credit
Agreement, the Company must ensure at all
times that all Designated Subsidiaries are (or
become within 30 Domestic Business Days of
being formed or acquired or becoming
Designated Subsidiaries) Subsidiary
Guarantors.".
(d) The Five-Year Credit Agreement is
hereby amended by adding a new Exhibit N: Form of
Security Agreement to the Five-Year Credit
Agreement in the form of Exhibit N hereto.
(e) The Five-Year Credit Agreement is
hereby amended by adding a new Exhibit O: Form of
Perfection Certificate to the Five-Year Credit
Agreement in the form of Exhibit O hereto.
SECTION 11. Appointments; Consents. The
Required Banks hereby:
(a) appoint Citicorp USA, Inc., as
Collateral Agent for the benefit of the
Secured Parties and the Loan Parties hereby
consent to such appointment.
(b) appoint Citicorp USA, Inc., as
Administrative Agent and the Loan Parties
hereby consent to such appointment;
(c) consent to the amendment of the Five-
Year Subsidiary Guarantee Agreement as
provided in
Section 10(b); and
(d) consent to the amendment of the five-
Year Indemnity, Subrogation and Contribution
Agreement as provided in Section 10(c) above.
SECTION 12. Representations and
Warranties. To induce the other parties hereto to
enter into this Amendment, the Company hereby
represents and warrants that, after giving effect
to this Amendment:
(a) The representations and warranties
set forth in Article 4 of the Five-Year Credit
Agreement, as amended by this Amendment, are
true and correct on and as of the date hereof,
except to the extent such representations and
warranties specifically relate to an earlier
date, with all references to "this Agreement"
being deemed to refer to the Five-Year Credit
Agreement, as amended by this Amendment;
(b) No Default or Event of Default has
occurred and is continuing; and
(c) This Amendment has been duly
executed and delivered by the Company and
constitutes a legal, valid and binding
obligation of the Company enforceable against
the Company in accordance with its terms.
SECTION 13. Amendment Fee. The Company
agrees to pay to the Administrative Agent, for the
account of each Bank that shall have executed and
delivered to the Syndication Agent a counterpart of
this Amendment prior to 12:00 noon New York City
time on December 26, 2001, a nonrefundable
amendment fee equal to 0.25% of the aggregate
amount of such Bank's Commitment, whether used or
unused, on the date hereof, payable in immediately
available funds.
SECTION 14. Conditions to Effectiveness.
This Amendment shall become effective on the date
on which:
(i) the Syndication Agent shall have
received counterparts of this Amendment that,
when taken together, bear the signatures of
the Company, the Required Banks and the
Syndication Agent;
(ii) the Administrative Agent shall have
received counterparts of the Security
Agreement that, when taken together, bear the
signatures of the Company, the Designated
Subsidiaries and the Collateral Agent;
(iii) the Syndication Agent shall have
received a certificate, signed by a Financial
Officer of the Company, confirming (A) the
accuracy of the representations set forth in
paragraphs (a) and (b) of Section 12 and (B)
the satisfaction of the Collateral
Requirement;
(iv) the Collateral Agent shall have
received a completed Perfection Certificate
dated the Amendment No. 2 Effective Date and
signed by a Financial Officer of the Company,
together with all attachments contemplated
thereby;
(v) the Administrative Agent shall have
received the amendment fees payable to the
Banks under Section 13;
(vi) the Syndication Agent and the
Collateral Agent shall have received written
opinions of Xxxx X. Xxxxxxxx XX, Esq., General
Counsel of the Company; Wachtell, Lipton,
Xxxxx & Xxxx, counsel to the Company; and such
other opinions as the Syndication Agent or the
Collateral Agent may reasonably request, each
addressing such matters as the Syndication
Agent or the Collateral Agent shall reasonably
have requested and in form and substance
reasonably acceptable to the Syndication Agent
or the Collateral Agent; and
(vii) the Syndication Agent shall have
received, on behalf of the Banks, (i) a copy
of the certificate or articles of
incorporation or other organizational
documents, including all amendments thereto,
of each of the Loan Parties, certified as of a
recent date by the Secretary of State (or
other appropriate governmental authority) of
the state of its organization, or other
evidence reasonably satisfactory to the
Syndication Agent as to the organization of
such Loan Party; (ii) a certificate as to the
good standing or subsistence, to the extent
available, of each of the Loan Parties as of a
recent date, from the appropriate Secretary of
State (or other appropriate governmental
authority) or other evidence reasonably
satisfactory to the Syndication Agent as to
the good standing of such Loan Party; (iii) a
certificate of the Secretary or Assistant
Secretary of each Loan Party dated the
Amendment No. 2 Effective Date and certifying
(A) that attached thereto is a true and
complete copy of the by-laws or other
organizational documents of such Loan Party as
in effect on the Amendment No. 2 Effective
Date and at all times since a date prior to
the date of the resolutions described in
clause (B) below, (B) that attached thereto is
a true and complete copy of resolutions duly
adopted by the Board of Directors (or other
analogous governing body) of such Loan Party
(and, if necessary, resolutions duly adopted
by the shareholders or other equity owners of
such Loan Party) authorizing the execution,
delivery and performance of the Loan Documents
to which such Loan Party is or is to be a
party and, in the case of the Borrowers, the
transactions hereunder, and that such
resolutions have not been modified, rescinded
or amended and are in full force and effect,
(C) that the certificate or articles of
incorporation or other organizational
documents of such Loan Party have not been
amended since the date of the last amendment
thereto shown on the certificate furnished
pursuant to clause (i) above, and (D) as to
the incumbency and specimen signature of each
officer executing any Loan Document or any
other document delivered in connection
herewith on behalf of such Loan Party; (iv) a
certificate of another officer as to the
incumbency and specimen signature of the
Secretary or Assistant Secretary executing the
certificate pursuant to clause (iii) above;
and (v) such other documents as the Banks, the
Issuing Bank or Cravath, Swaine & Xxxxx,
special counsel for the Syndication Agent, may
reasonably request related to the foregoing.
SECTION 15. Effect of Amendment. (a) On
and after the Amendment No. 2 Effective Date, each
reference in the Five-Year Credit Agreement to
"this Agreement", "hereunder", "herein", or words
of like import shall mean and be a reference to the
Five-Year Credit Agreement, as
amended hereby. Except as expressly set forth
herein, this Amendment shall not by implication or
otherwise limit, impair, constitute a waiver of or
otherwise affect the rights and remedies of the
Banks under the Five-Year Credit Agreement or any
other Loan Documents, and shall not alter, modify,
amend or in any way affect any of the terms,
conditions, obligations, covenants or agreements
contained in the Five-Year Credit Agreement or any
other Loan Documents, all of which are ratified and
affirmed in all respects and shall continue in full
force and effect. Nothing herein shall be deemed to
entitle the Company to a consent to, or a waiver,
amendment, modification or other change of, any of
the terms, conditions, obligations, covenants or
agreements contained in the Five-Year Credit
Agreement or any other Loan Documents in similar or
different circumstances. This Amendment shall
apply and be effective only with respect to the
provisions of the FiveYear Credit Agreement
specifically referred to herein.
(b) Nothing herein will be deemed to reduce
the obligations of any Subsidiary Guarantor under
the Subsidiary Guarantee Agreement, which shall
remain in full force and effect.
SECTION 16. References in Documents
Executed in Connection with this Amendment.
References to Citibank, N.A. as Administrative
Agent and/or Collateral Agent in documents executed
in connection with this Amendment will be deemed to
be references to Citicorp USA, Inc. as
Administrative Agent and/or Collateral Agent, as
applicable.
SECTION 17. Counterparts. This
Amendment may be executed by one or more parties to
this Amendment in any number of separate
counterparts, each of which shall constitute an
original, but all of which when taken together
shall constitute but one contract. Delivery of an
executed counterpart of a signature page of this
Amendment by facsimile transmission shall be as
effective as delivery of a manually executed
counterpart hereof.
SECTION 18. APPLICABLE LAW. THIS
AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
SECTION 19. Headings. Section headings
used herein are for convenience of reference only,
are not part of, and are not to be taken into
consideration in interpreting, this Amendment.
SECTION 20. Expenses. The Company shall
reimburse the Syndication Agent and the Collateral
Agent for their reasonable out-of-pocket expenses
in connection with this Amendment, including the
reasonable fees, charges and disbursements of
Cravath, Swaine & Xxxxx.
IN WITNESS WHEREOF, the Company, the
Administrative Agent and the undersigned Banks have
caused this Amendment to be duly executed by their
duly authorized officers, all as of the date first
above written.
CROMPTON CORPORATION,
By
Name:
Title:
By
Name:
Title:
Each of the Subsidiary Guarantors hereby
acknowledges receipt of, and consents to the terms
of, this Amendment.
CROMPTON MANUFACTURING COMPANY, INC.,
By
Name:
Title:
By
Name:
Title:
CITICORP USA, INC., individually, as Administrative
Agent and as Collateral Agent,
By
Name:
Title:
JPMORGAN CHASE BANK (formerly known as THE CHASE
MANHATTAN BANK), individually,
By
Name:
Title:
By
Name:
Title:
000 Xxxx Xxxxxx Xxx Xxxx, XX 00000
BANK OF AMERICA, N.A.,
By
Name:
Title:
000 Xxxxxxx Xxxxxx Xxx Xxxx, XX 00000
DEUTSCHE BANK AG NEW YORK BRANCH a/o CAYMAN ISLANDS
BRANCH,
By
Name:
Title:
Name:
Title:
00 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
MELLON BANK, N.A.,
By
Name:
Title:
Xxx Xxxxxx Xxxx Xxxxxx Xxxxxxxxxx, XX
00000
ABN AMRO BANK N.V.,
By
Name:
Title:
By
Name:
Title:
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
COMMERZBANK AG
NEW YORK AND GRAND CAYMAN BRANCHES,
By
Name:
Title:
By
Name:
Title:
FOUR WINDS FUNDING CORPORATION,
as Designee,
By
Name:
Title:
BANK HAPOALIM B.M.,
By
Name:
Title:
Address:
THE BANK OF NEW YORK,
By
Name:
Title:
Address:
FIRST UNION NATIONAL BANK,
By
Name:
Title:
000 X. Xxxxxxx Xxxxxx, XX-0 Xxxxxxxxx, XX
00000-0000
FLEET NATIONAL BANK,
By
Name:
Title:
0 Xxxxxxx Xxxxxx Xxxxxx, XX 00000
FORTIS (USA) FINANCE LLC,
By
Name:
Title:
Name:
Title:
Address:
BANK OF TOKYO-MITSUBISHI TRUST COMPANY,
By
Name:
Title:
0000 Xxxxxx xx xxx Xxxxxxxx Xxx Xxxx, XX
00000-0000
WESTDEUTSCHE LANDESBANK,
By
Name:
Title:
By
Name:
Title:
0000 Xxxxxx xx xxx Xxxxxxxx Xxx Xxxx, XX
00000
THE BANK OF NOVA SCOTIA,
By
Name:
Title:
Address:
BNP PARIBAS,
By
Name:
Title:
By
Name:
Title:
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
BANCA NAZIONALE DEL LAVORO S.P.A. NEW YORK BRANCH,
By
Name:
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
SUNTRUST BANK,
By
Name:
Title:
000 Xxxxx Xxxxxx, 00xx Xxxxx Xxx Xxxx, XX
00000
INTESABCI NEW YORK BRANCH,
By
Name:
Title:
By
Name:
Title:
Xxx Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
ING (U.S.) CAPITAL LLC,
By
Name:
Title:
0000 Xxxxxx xx xxx Xxxxxxxx 0xx Xxxxx
Xxx Xxxx, XX 00000
THE INDUSTRIAL BANK OF JAPAN,
By
Name:
Title:
Address:
BANCA MONTE DEI PASCHI DI SIENA S.P., By
Name:
Title:
By
Name:
Title:
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
PEOPLE'S BANK,
By
Name:
Title:
000 Xxxxxxx Xxxxxx Xxxxxxxx, XX 00000
HIBERNIA NATIONAL BANK,
By
Name:
Title:
000 Xxxxxxxxxx Xxxxxx Xxx Xxxxxxx, XX
00000
PRICING SCHEDULE
Each of "Facility Fee Rate", "Euro-Dollar
Margin" and "CD Margin" means, for any day, the
rate set forth below in the row opposite such term
and in the column corresponding to the Pricing
Level that applies on such day as determined based
on the ratings by Moody's and S&P:
Pricing Xxxxx X Xxxxx XX Xxxxx XXX XXX-
Xxxxx XXX/Xxx0 BBB-/ and Ba1 or BB+
Baa3 and Baa3
Facility
Fee Rate 0.150% 0.200% 0.375%
Euro-Dollar
Margin 0.850%1 1.300%1 1.625%1
CD Margin 2.100%1 2.550%1 2.875%1
Base Rate
Margin 0.150%1 0.300% 0.625%1
Pricing Level IV BB+/Bal Level V BB+/Bal
Level
Facility
Fee Rate 0.425% 0.500%
Euro-Dollar
Margin 1.825%1 2.000%1
CD Margin 3.075%1 3.250%1
Base Rate
Margin 0.825%1 1.000%1
1 The Euro-Dollar Margin, CD Margin and Base Rate
Margin shall increase by 0.500% per annum on any
day on which the Company has a Leverage Ratio that
is greater than 4.0 to 1.0.
For purposes of this Schedule, the
following terms have the following
meanings:
"Moody's" means Xxxxx'x Investors
Service, Inc.
"S&P" means Standard & Poor's Ratings
Services, a division of The XxXxxx-Xxxx
Companies, Inc.
The credit ratings to be utilized for purposes of
this Schedule are those assigned to this Agreement
and the 364Day Credit Agreement and if no credit
rating shall be available for this Agreement and
the 364-Day Credit Agreement, to the senior
unsecured long-term debt securities of the Company
without third-party credit enhancement, and any
rating assigned to any other debt security of the
Company shall be disregarded. The ratings in
effect for any day are those in effect at the close
of business on such day. In the case the ratings
from S&P and Moody's would indicate different
Levels, the lower Level (Level V being the lowest
Level) will apply.
