1
Exhibit (b)(3) [EXECUTION COPY]
SECOND AMENDMENT
TO
REVOLVING CREDIT AGREEMENT
This SECOND AMENDMENT TO REVOLVING CREDIT AGREEMENT, dated as of
September 24, 1996 (this "Amendatory Agreement"), is among HANDY & XXXXXX, a New
York corporation (the "Borrower"), certain financial institutions signatories
hereto (the "Lenders"), THE BANK OF NOVA SCOTIA, THE CHASE MANHATTAN BANK
(formerly known as Chemical Bank) and THE BANK OF NEW YORK, as the co-agents
(collectively referred to herein as the "Co-Agents") and THE BANK OF NOVA
SCOTIA, as administrative agent (the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders, the Co-Agents and the
Administrative Agent are parties to a Revolving Credit Agreement, dated as of
September 28, 1994 (as amended or otherwise modified to the date hereof, the
"Existing Credit Agreement"); and
WHEREAS, the parties hereto have agreed, subject to the conditions and
terms hereinafter set forth, to amend the Existing Credit Agreement in certain
respects as herein provided (the Existing Credit Agreement, as so amended by
this Amendatory Agreement, being referred to as the "Credit Agreement");
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereto agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. Certain Definitions. The following terms (whether or not
underscored) when used in this Amendatory Agreement shall have the following
meanings (such meanings to be equally applicable to the singular and plural form
thereof):
"Administrative Agent" is defined in the preamble.
"Amendatory Agreement" is defined in the preamble.
"Borrower" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Credit Agreement" is defined in the second recital.
"Existing Credit Agreement" is defined in the first recital.
"Lenders" is defined in the preamble.
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"Second Amendment Effective Date" is defined in Subpart 4.1.
SUBPART 1.2. Other Definitions. Terms for which meanings are provided
in the Existing Credit Agreement are, unless otherwise defined herein or the
context otherwise requires, used in this Amendatory Agreement with such
meanings.
PART II
AMENDMENTS TO THE
EXISTING CREDIT AGREEMENT
AND EXTENSION OF STATED MATURITY DATE
Effective on (and subject to the occurrence of) the Second Amendment
Effective Date, the Existing Credit Agreement is hereby amended and the Stated
Maturity Date is hereby extended in accordance with this Part II; except as so
amended, the Existing Credit Agreement shall continue in full force and effect.
SUBPART 2.1. Amendments to Article I. Article I of the Existing Credit
Agreement is hereby amended in accordance with Subparts 2.1.1 through 2.1.2.
SUBPART 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby
amended by inserting the following definitions in such Section in the
appropriate alphabetical sequence:
"Applicable Commitment Fee Margin" means the lowest per annum
rate determined by reference to the Net Debt to EBITDA Ratio and EBITDA
to Interest Ratio, in each case that is satisfied for each of such
ratios in a given clause below and as indicated in the Compliance
Certificate most recently delivered pursuant to clause (c) of Section
7.1.1, equal to:
(a) 0.15% if the Net Debt to EBITDA Ratio is less
than or equal to 1.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 5.0:1;
(b) 0.20% if the Net Debt to EBITDA Ratio is less
than or equal to 2.25:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.75:1;
(c) 0.25% if the Net Debt to EBITDA Ratio is less
than or equal to 2.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.00:1; and
(d) 0.30% if the Net Debt to EBITDA Ratio is greater
than 2.75:1 or the EBITDA to Interest Ratio is less than
3.00:1.
The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio
used to compute the Applicable Commitment Fee Margin
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shall be the Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio,
as the case may be, set forth in the Compliance Certificate most
recently delivered by the Borrower to the Administrative Agent pursuant
to clause (c) of Section 7.1.1; changes in the Applicable Commitment
Fee Margin resulting from a change in the Net Debt to EBITDA Ratio
and/or the EBITDA to Interest Ratio, as the case may be, shall become
effective upon delivery by the Borrower to the Administrative Agent of
a new Compliance Certificate pursuant to clause (c) of Section 7.1.1.
Notwithstanding the foregoing, the Lenders acknowledge and agree that,
subject to the next sentence, the Applicable Commitment Fee Margin for
the period from the Second Amendment Effective Date through (but
excluding) the date that the first Compliance Certificate is delivered
following the Second Amendment Effective Date shall be determined by
reference to level (c) above (notwithstanding the actual Net Debt to
EBITDA Ratio and EBITDA to Interest Ratio for such period). If the
Borrower shall fail to deliver a Compliance Certificate within the
number of days after the end of any Fiscal Quarter as required pursuant
to clause (c) of Section 7.1.1 (without giving effect to any grace
period), the Applicable Commitment Fee Margin from and including the
first day after the date on which such Compliance Certificate was
required to be delivered to but not including the date the Borrower
delivers to the Administrative Agent a Compliance Certificate shall
conclusively equal the highest Applicable Commitment Fee Margin set
forth above.
"Applicable L/C Margin" means the lowest per annum rate
determined by reference to the Net Debt to EBITDA Ratio and EBITDA to
Interest Ratio, in each case that is satisfied for each of such ratios
in a given clause below and as indicated in the Compliance Certificate
most recently delivered pursuant to clause (c) of Section 7.1.1, equal
to:
(a) 0.40% if the Net Debt to EBITDA Ratio is less
than or equal to 1.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 5.0:1;
(b) 0.55% if the Net Debt to EBITDA Ratio is less
than or equal to 2.25:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.75:1;
(c) 0.70% if the Net Debt to EBITDA Ratio is less
than or equal to 2.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.00:1; and
(d) 0.95% if the Net Debt to EBITDA Ratio is greater
than 2.75:1 or the EBITDA to Interest Ratio is less than
3.00:1.
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The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio
used to compute the Applicable L/C Margin shall be the Net Debt to
EBITDA Ratio and the EBITDA to Interest Ratio, as the case may be, set
forth in the Compliance Certificate most recently delivered by the
Borrower to the Administrative Agent pursuant to clause (c) of Section
7.1.1; changes in the Applicable L/C Margin resulting from a change in
the Net Debt to EBITDA Ratio and/or the EBITDA to Interest Ratio, as
the case may be, shall become effective upon delivery by the Borrower
to the Administrative Agent of a new Compliance Certificate pursuant to
clause (c) of Section 7.1.1. Notwithstanding the foregoing, the Lenders
acknowledge and agree that, subject to the next sentence, the
Applicable L/C Margin for the period from the Second Amendment
Effective Date through (but excluding) the date that the first
Compliance Certificate is delivered following the Second Amendment
Effective Date shall be determined by reference to level (c) above
(notwithstanding the actual Net Debt to EBITDA Ratio and EBITDA to
Interest Ratio for such period). If the Borrower shall fail to deliver
a Compliance Certificate within the number of days after the end of any
Fiscal Quarter as required pursuant to clause (c) of Section 7.1.1
(without giving effect to any grace period), the Applicable L/C Margin
from and including the first day after the date on which such
Compliance Certificate was required to be delivered to but not
including the date the Borrower delivers to the Administrative Agent a
Compliance Certificate shall conclusively equal the highest Applicable
L/C Margin set forth above.
"Applicable LIBO Rate Margin" means, with respect to any Loan
made or maintained as a LIBO Rate Loan, the lowest per annum rate
determined by reference to the Net Debt to EBITDA Ratio and EBITDA to
Interest Ratio, in each case that is satisfied for each of such ratios
in a given clause below and as indicated in the Compliance Certificate
most recently delivered pursuant to clause (c) of Section 7.1.1, equal
to:
(a) 0.45% if the Net Debt to EBITDA Ratio is less
than or equal to 1.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 5.0:1;
(b) 0.60% if the Net Debt to EBITDA Ratio is less
than or equal to 2.25:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.75:1;
(c) 0.75% if the Net Debt to EBITDA Ratio is less
than or equal to 2.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.00:1; and
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(d) 1.00% if the Net Debt to EBITDA Ratio is greater
than 2.75:1 or the EBITDA to Interest Ratio is less than
3.00:1.
The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio
used to compute the Applicable LIBO Rate Margin shall be the Net Debt
to EBITDA Ratio and the EBITDA to Interest Ratio, as the case may be,
set forth in the Compliance Certificate most recently delivered by the
Borrower to the Administrative Agent pursuant to clause (c) of Section
7.1.1; changes in the Applicable LIBO Rate Margin resulting from a
change in the Net Debt to EBITDA Ratio and/or the EBITDA to Interest
Ratio, as the case may be, shall become effective upon delivery by the
Borrower to the Administrative Agent of a new Compliance Certificate
pursuant to clause (c) of Section 7.1.1. Notwithstanding the foregoing,
the Lenders acknowledge and agree that, subject to the next sentence,
the Applicable LIBO Rate Margin for the period from the Second
Amendment Effective Date through (but excluding) the date that the
first Compliance Certificate is delivered following the Second
Amendment Effective Date shall be determined by reference to level (c)
above (notwithstanding the actual Net Debt to EBITDA Ratio and EBITDA
to Interest Ratio for such period). If the Borrower shall fail to
deliver a Compliance Certificate within the number of days after the
end of any Fiscal Quarter as required pursuant to clause (c) of Section
7.1.1 (without giving effect to any grace period), the Applicable LIBO
Rate Margin from and including the first day after the date on which
such Compliance Certificate was required to be delivered to but not
including the date the Borrower delivers to the Administrative Agent a
Compliance Certificate shall conclusively equal the highest Applicable
LIBO Rate Margin set forth above.
"EBITDA" means, for any period, the sum for such period of all
amounts which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries
as
(a) EBIT;
plus
(b) the amount deducted, in determining Net
Income, representing amortization;
plus
(c) the amount deducted, in determining Net
Income, representing depreciation of assets.
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"EBITDA to Interest Ratio" means, at the close of any Fiscal
Quarter, the ratio, computed for the period consisting of such Fiscal
Quarter and each of the three immediately preceding Fiscal Quarters, of
(a) EBITDA
to
(b) Interest Expense.
"Net Debt to EBITDA Ratio" means, at the last day of any
Fiscal Quarter, the ratio, computed (in the case of clause (b) below)
for the period consisting of such Fiscal Quarter and each of the three
immediately preceding Fiscal Quarters, of
(a) Debt minus the aggregate amount of cash and Cash
Equivalent Investments (not subject to any Lien or other
encumbrance) owned by the Borrower and its Subsidiaries on
such last day
to
(b) EBITDA.
"Second Amendment" means the Second Amendment, dated as of
September 24, 1996, to this Agreement among the Borrower, the Lenders
party thereto, the Co-Agents and the Administrative Agent.
"Second Amendment Effective Date" means the Second
Amendment Effective Date as defined in Subpart 4.1 of the
Second Amendment.
SUBPART 2.1.2. Section 1.1 of the Existing Credit Agreement is further
amended by amending the definition of "Loan Commitment Amount" appearing in such
Section in its entirety to read as follows:
"`Loan Commitment Amount' means, on any day, $150,000,000, as
such amount may be reduced from time to time pursuant to Section 2.2."
SUBPART 2.2. Amendments to Article III. Article III of the Existing
Credit Agreement is hereby amended in accordance with Subparts 2.2.1 and 2.2.2.
SUBPART 2.2.1. Clause (ii) of Section 3.2.1 of the Existing Credit
Agreement is hereby amended in its entirety to read as follows:
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"(ii) On that portion of such Borrowing maintained as LIBO
Rate Loans, during each Interest Period applicable thereto, such rate
shall be equal to the sum of the LIBO Rate (Reserve Adjusted) for such
Interest Period plus the Applicable LIBO Rate Margin; and"
SUBPART 2.2.2. Section 3.3.1 of the Existing Credit Agreement is hereby
amended by deleting the words "at the rate of 3/8 of 1% per annum" and inserting
the words "equal to the Applicable Commitment Fee Margin" in place thereof.
SUBPART 2.2.3. Section 3.3.2 of the Existing Credit Agreement is hereby
amended by (i) deleting the words "at the rate of 7/8 of 1% per annum" appearing
in clause (x) of such Section and inserting the words "equal to the Applicable
L/C Margin" in place thereof and (ii) deleting the words "at the rate of 1/4 of
1% per annum" appearing in clause (y) of such Section and inserting the words
"at the rate of 0.1875% per annum" in place thereof.
SUBPART 2.3. Amendments to Exhibits. Exhibit A-1 (Form of Revolving
Note), Exhibit A-2 (Form of Competitive Bid Loan Note) and Exhibit E (Compliance
Certificate) to the Existing Credit Agreement are hereby amended in their
entirety to read as respectively set forth on Exhibits A, B and C hereto.
SUBPART 2.4. Extension of Stated Maturity Date. By their signatures
below, the parties hereto hereby agree that, in accordance with the terms of
Section 2.4 of the Existing Credit Agreement, upon the effectiveness of this
Amendatory Agreement, the Stated Maturity Date shall be September 27, 1999.
PART III
ACKNOWLEDGEMENT
SUBPART 3.1. Acknowledgement. By their signature below, each of the
Lenders acknowledges and agrees that, as of the Second Amendment Effective Date
(and notwithstanding any reductions to the Loan Commitment Amount that have
occurred prior to the Second Amendment Effective Date), the Loan Commitment
Amount is $150,000,000, as such amount may be reduced from time to time pursuant
to Section 2.2 of the Credit Agreement.
PART IV
CONDITIONS TO EFFECTIVENESS
SUBPART 4.1. Second Amendment Effective Date. This
Amendatory Agreement shall become effective on the date first set
forth above (the "Second Amendment Effective Date") when each of
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the conditions set forth in this Subpart 4.1 shall have been satisfied.
SUBPART 4.1.1. Execution of Counterparts. The Administrative Agent
shall have received counterparts of this Amendatory Agreement, duly executed on
behalf of the Borrower and each of the Lenders.
SUBPART 4.1.2. Resolutions, etc. The Administrative Agent shall have
received from the Borrower, with copies for each Lender, a certificate, dated
the Second Amendment Effective Date, of its Secretary or Assistant Secretary as
to
(a) resolutions of its Board of Directors, then in full force
and effect, authorizing the execution, delivery and performance of this
Amendatory Agreement and each other Loan Document to be executed by it
in connection with this Amendatory Agreement; and
(b) the incumbency and signatures of its officers authorized
to execute and deliver, and act with respect to, this Amendatory
Agreement, each other Loan Document and each of the other documents,
certificates, instruments and other agreements delivered or to be
delivered by it pursuant to this Amendatory Agreement and pursuant to
the Credit Agreement.
Each of the Lenders and the Agents may conclusively rely upon such certificate
until the Administrative Agent has received a further certificate of the
Secretary or an Assistant Secretary of the Borrower cancelling or amending such
prior certificate.
SUBPART 4.1.3. Fees and Expenses. The Administrative Agent shall have
received payment in full of (i) an amendment fee in an amount equal to $155,875
for the pro rata account of the Lenders as set forth on Schedule I and (ii) all
other fees, costs and expenses due and payable as of the Second Amendment
Effective Date.
SECTION 4.1.4. Opinions of Counsel. The Administrative Agent shall have
received opinions, dated the Second Amendment Effective Date and addressed to
the Issuer, the Agents and all Lenders, from counsel to the Borrower, in form
and substance satisfactory to the Adminstrative Agent.
SUBPART 4.1.5. Delivery of Notes. The Administrative Agent shall have
received, for the account of each Lender, Notes, issued in substitution and
exchange for, and not in satisfaction of, the Notes delivered under the terms of
the Existing Credit Agreement, duly executed and delivered by the Borrower.
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SUBPART 4.1.6. Legal Details, etc. All documents executed or submitted
pursuant hereto shall be satisfactory in form and substance to the
Administrative Agent and its counsel. The Administrative Agent and its counsel
shall have received all information and such counterpart originals or such
certified or other copies or such materials, as the Administrative Agent or its
counsel may reasonably request, and all legal matters incident to the
transactions contemplated by this Amendatory Agreement shall be satisfactory to
the Administrative Agent and its counsel.
PART V
MISCELLANEOUS
SUBPART 5.1. Cross-References. References in this Amendatory Agreement
to any Part or Subpart are, unless otherwise specified or otherwise required by
the context, to such Part or Subpart of this Amendatory Agreement.
SUBPART 5.2. Loan Document Pursuant to Existing Credit Agreement. This
Amendatory Agreement is a Loan Document executed pursuant to the Existing Credit
Agreement and shall be construed, administered and applied in accordance with
all of the terms and provisions of the Existing Credit Agreement.
SUBPART 5.3. Successors and Assigns. This Amendatory Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
SUBPART 5.4. Counterparts. This Amendatory Agreement may be executed by
the parties hereto in several counterparts, each of which when executed and
delivered shall be deemed to be an original and all of which shall constitute
together but one and the same agreement.
SUBPART 5.5. Representations, No Default, etc. As of the date of
effectiveness of this Amendatory Agreement, the Borrower hereby represents and
warrants to the Agents, the Issuer and the Lenders that
(a) the representations and warranties set forth in Article VI
of the Existing Credit Agreement (excluding, however, those contained
in Section 6.7 thereof) are true and correct in all material respects
(unless stated to relate solely to an earlier date, in which case such
representations and warranties were true and correct as of such earlier
date);
(b) except as disclosed by the Borrower to the Administrative
Agent and the Lenders pursuant to Section 6.7 of the Existing Credit
Agreement,
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(i) no litigation, arbitration or governmental
investigation or proceeding is pending or, to the knowledge of
the Borrower, threatened against the Borrower or any of its
Subsidiaries which may reasonably be expected to materially
adversely affect the Borrower's, or the Borrower and its
Subsidiaries' taken as a whole, financial condition,
operations, assets, businesses, properties or prospects or
which purports to affect the legality, validity or
enforceability of the Existing Credit Agreement, the Notes or
any other Loan Document; and
(ii) no development has occurred in any litigation,
arbitration or governmental investigation or proceeding
disclosed pursuant to Section 6.7 of the Existing Credit
Agreement which may reasonably be expected to materially
adversely affect the financial condition, operations, assets,
businesses, properties or prospects of the Borrower or the
Borrower and its Subsidiaries, taken as a whole; and
(c) no Default has occurred and is continuing.
SUBPART 5.6. Limited Waiver, etc. No amendment, waiver or approval by
the Agents, the Issuer or any Lender under this Amendatory Agreement shall,
except as may be otherwise stated in this Amendatory Agreement, be applicable to
subsequent transactions. No amendment, waiver or approval hereunder shall
require any similar or dissimilar amendment, waiver or approval to be granted
after the date hereof, and except as expressly modified by this Amendatory
Agreement, the provisions of the Existing Credit Agreement shall remain in full
force and effect, without amendment or other modification.
SUBPART 5.7. Governing Law. THIS AMENDATORY AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendatory
Agreement to be executed by their respective authorized officers as of the day
and year first above written.
HANDY & XXXXXX
By______________________________________
Title:
THE BANK OF NOVA SCOTIA,
in its capacity as Administrative
Agent, Co-Agent and Lender
By______________________________________
Title:
00
XXX XXXX XX XXX XXXX,
in its capacity as
Co-Agent and Lender
By______________________________________
Title:
13
THE CHASE MANHATTAN BANK (formerly known
as Chemical Bank), in its capacity as
Co-Agent and Lender
By______________________________________
Title:
14
FLEET PRECIOUS METALS INC.
By______________________________________
Title:
15
THE FIRST NATIONAL BANK OF CHICAGO
(formerly known as NBD Bank)
By______________________________________
Title:
16
BANK OF TOKYO - MITSUBISHI TRUST
COMPANY
By______________________________________
Title:
17
LTCB TRUST COMPANY
By______________________________________
Title:
18
CREDIT LYONNAIS NEW YORK BRANCH
By______________________________________
Title:
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By______________________________________
Title:
19
THE SUMITOMO BANK, LIMITED
By______________________________________
Title:
By______________________________________
Title:
00
XXXXXXXX XXXX XX, XXX XXXX XXX/XX
XXXXXX XXXXXXX BRANCHES
By______________________________________
Title:
By______________________________________
Title:
00
XXX XXXX XXXX, XXXXXXX,
XXX XXXX BRANCH
By______________________________________
Title:
22
ABN AMRO BANK N.V. NEW YORK BRANCH
By______________________________________
Title:
By______________________________________
Title:
23
BANQUE PARIBAS
By______________________________________
Title:
By______________________________________
Title:
24
GIROCREDIT BANK AG DER SPARKESSEN
GRAND CAYMAN ISLAND BRANCH
By______________________________________
Title:
By______________________________________
Title:
25
COMERICA BANK
By______________________________________
Title:
26
IBJ XXXXXXXX BANK & TRUST COMPANY
By______________________________________
Title:
27
YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By______________________________________
Title:
28
SCHEDULE I
TO SECOND AMENDMENT
Allocation of Amendment Fee
---------------------------
Lender Amount
------ ------
$
---------
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EXHIBIT A
TO SECOND AMENDMENT
EXHIBIT A-1
Revolving Loan Note
$____________ September 28, 1994
FOR VALUE RECEIVED, the undersigned, HANDY & XXXXXX, a New York
corporation (the "Borrower"), promises to pay to the order of
_________________________ (the "Lender") on the Stated Maturity Date (as such
term is defined in the Credit Agreement referred to below), the principal sum of
______________ DOLLARS ($__________) or, if less, the aggregate unpaid principal
amount of all Revolving Loans (as such term is defined in the Revolving Credit
Agreement, dated as of the date hereof (as such Revolving Credit Agreement may
be amended, supplemented, amended and restated or otherwise modified from time
to time, the "Credit Agreement"), among the Borrower, The Bank of Nova Scotia,
The Chase Manhattan Bank (formerly known as Chemical Bank) and The Bank of New
York, as Co-Agents, The Bank of Nova Scotia, as Administrative Agent and certain
financial institutions (including the Lender) as are, or may become, parties
thereto), made by the Lender pursuant to the Credit Agreement. A notation
indicating all Revolving Loans made by the Lender pursuant to the Credit
Agreement and payments on account of principal of such Revolving Loans may, from
time to time, be made by the holder hereof on the grid attached to this
Revolving Loan Note. Unless otherwise defined herein or the context otherwise
requires, terms used herein have the meanings provided in the Credit Agreement.
The unpaid principal amount of this Revolving Loan Note from time to
time outstanding shall bear interest as provided in Section 3.2.1 of the Credit
Agreement. All payments of principal of and interest on this Revolving Loan Note
shall be payable in lawful currency of the United States of America to the
account designated by the Administrative Agent in same day funds.
This Revolving Loan Note represents a renewal of, and is issued in
substitution and exchange for, and not in satisfaction of, that certain
Revolving Loan Note of the Borrower, dated September 28, 1994, payable to the
order of the Lender (or its assignor). The indebtedness originally evidenced by
such promissory note is a continuing Indebtedness, and nothing herein contained
shall be construed to deem such promissory note paid.
This Revolving Loan Note is one of the Revolving Loan Notes referred to
in, and evidences indebtedness incurred in respect of
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the Revolving Loans under, the Credit Agreement, to which reference is made for
a statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments of principal of the indebtedness evidenced by this
Revolving Loan Note and on which such indebtedness may be declared to be or may
become immediately due and payable.
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THIS REVOLVING LOAN NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK, AND
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK.
HANDY & XXXXXX
By______________________________________
Title:
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GRID
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LAST DAY
OF
APPLICABLE AMOUNT OF OUTSTANDING
AMOUNT OF ALTERNATE INTEREST PRINCIPAL PRINCIPAL NOTATION MADE
DATE LOAN BASE RATE LIBO RATE PERIOD PAYMENT BALANCE BY
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EXHIBIT B
TO SECOND AMENDMENT
Exhibit A-2
Competitive Bid Loan Note
$150,000,000 September 28, 1994
FOR VALUE RECEIVED, the undersigned, HANDY & XXXXXX, a New York
corporation (the "Borrower"), promises to pay to the order of
_______________________ (the "Lender") on the earlier of (i) each Competitive
Bid Loan Maturity Date (as such term is defined in that certain Revolving Credit
Agreement, dated as of the date hereof (as such Revolving Credit Agreement may
be amended, supplemented, amended and restated or otherwise modified from time
to time, the "Credit Agreement"), among the Borrower, The Bank of Nova Scotia,
The Chase Manhattan Bank (formerly known as Chemical Bank) and The Bank of New
York, as Co-Agents, The Bank of Nova Scotia, as Administrative Agent and certain
financial institutions (including the Lender) as are, or may from time to time
become parties thereto), and (ii) the Commitment Termination Date (as defined in
the Credit Agreement), the principal sum of ONE HUNDRED FIFTY MILLION DOLLARS
($150,000,000) or, if less, the unpaid principal amount of all Competitive Bid
Loans made by the Lender to the Borrower from time to time pursuant to Section
2.4. of the Credit Agreement. A notation indicating all Competitive Bid Loans
made by the Lender pursuant to the Credit Agreement and all payments on account
of principal of such Competitive Bid Loans may, from time to time, be made by
the holder hereof on the grid attached to this Competitive Bid Loan Note.
The unpaid principal amount of this Competitive Bid Loan Note from time
to time outstanding shall bear interest as provided in Section 3.2.1 of the
Credit Agreement. All payments of principal of and interest on this Competitive
Bid Loan Note shall be payable in lawful currency of the United States of
America to the account designated by the Administrative Agent in same day funds.
This Competitive Bid Loan Note represents a renewal of, and is issued in
substitution and exchange for, and not in satisfaction of, that certain
Competitive Bid Loan Note of the Borrower, dated September 28, 1994, payable to
the order of the Lender (or its assignor). The indebtedness originally evidenced
by such promissory note is a continuing indebtedness, and nothing herein
contained shall be construed to deem such promissory note paid.
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This Competitive Bid Loan Note is one of the Competitive Bid Loan Notes
referred to in, and evidences indebtedness incurred in respect of Competitive
Bid Loans under, the Credit Agreement, to which reference is made for a
statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments of principal of the indebtedness evidenced by this
Competitive Bid Loan Note and on which such indebtedness may be declared to be
or may become immediately due and payable. Unless otherwise defined herein or
the context otherwise requires, terms used herein have the meanings provided in
the Credit Agreement.
THIS COMPETITIVE BID LOAN NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK
AND SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK.
HANDY & XXXXXX
By______________________________________
Title:
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35
GRID
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COMPETITIVE
BID LOAN AMOUNT OF AMOUNT OF OUTSTANDING
AMOUNT MATURITY INTEREST INTEREST PRINCIPAL PRINCIPAL NOTATION
DATE OF LOAN DATE PERIOD PAYMENT PAYMENT BALANCE MADE BY
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36
EXHIBIT C
TO SECOND AMENDMENT
Form of Compliance Certificate
To: Each of the Lenders
(as defined below)
-and-
The Bank of Nova Scotia,
as Administrative Agent
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: ______________
Handy & Xxxxxx
Gentlemen:
This Compliance Certificate is being delivered pursuant to clause (c)
of Section 7.1.1 of the Revolving Credit Agreement, dated as of September 28,
1994 (as amended, supplemented, amended and restated or otherwise modified, the
"Credit Agreement"), among Handy & Xxxxxx, a New York corporation (the
"Borrower"), certain financial institutions now or hereafter parties thereto
(the "Lenders"), The Bank of Nova Scotia, The Chase Manhattan Bank (formerly
known as Chemical Bank) and The Bank of New York, as Co-Agents for the Lenders
and The Bank of Nova Scotia, as Administrative Agent. Terms used herein without
definition shall have the meanings assigned to such terms in Section 1.1 of the
Credit Agreement.
The Borrower hereby certifies, represents and warrants that as of
_________ __, 19__ (the "Computation Date"):
(a) The Adjusted Consolidated Tangible Net Worth was $__________, as
computed on Attachment 1 hereto and such amount [complies] [does not comply]
with the provisions of clause (a) of Section 7.2.4 of the Credit Agreement;
(b) The Leverage Ratio was __:1.00, as computed on Attachment 2 hereto
and such ratio [complies] [does not comply] with the provisions of clause (b) of
Section 7.2.4 of the Credit Agreement;
(c) The Interest Coverage Ratio was __:1.00, as computed on Attachment
3 hereto and such ratio [complies] [does not comply] with the provisions of
clause (c) of Section 7.2.4 of the Credit Agreement;
37
(d) The Net Debt to EBITDA Ratio was __:1.00 and the EBITDA to Interest
Ratio was __:1.00, as computed on Attachment 4 hereto;
(e) The aggregate amount of Designated Debt of the Borrower and its
Subsidiaries was $_________ as computed on Attachment 5 hereto and such amount
[complies] [does not comply] with clause (a) of Section 7.2.2 of the Credit
Agreement;
(f) The aggregate amount of Debt of all Subsidiaries was $_________,
and such amount [complies] [does not comply] with clause (b) of Section 7.2.2 of
the Credit Agreement;
(g) The aggregate face amount of Indebtedness in respect of letters of
credit (other than Letters of Credit) was $________, and such amount [complies]
[does not comply] with clause (a)(ii)(B) of Section 7.2.2 of the Credit
Agreement;
(h) The aggregate amount of Investments (other than the Investments
permitted by clauses (a) through (f) of Section 7.2.5 of the Credit Agreement)
made, incurred, assumed or otherwise existing by the Borrower and its
Subsidiaries was $_________ and such amount [complies] [does not comply] with
clause (g) of Section 7.2.5 of the Credit Agreement;
(i) The aggregate amount of rental obligations entered into by the
Borrower and its Subsidiaries of the type set forth in Section 7.2.8 of the
Credit Agreement was $_________ and such amount [complies] [does not comply]
with Section 7.2.8 of the Credit Agreement;
(j) The aggregate book value or market value, if higher (determined as
to particular assets as of the respective date of disposition thereof) (other
than in accordance with clauses (a), (b) and (c) of Section 7.2.11 of the Credit
Agreement) of all assets sold, transferred, leased, contributed or otherwise
conveyed by the Borrower and its Subsidiaries (i) since the Effective Date was
$__________ and such amount [complies] [does not comply] with clause (d)(i) of
Section 7.2.11 of the Credit Agreement, and (ii) constitutes assets which
contributed __% of operating profit contribution during the three most recently
completed Fiscal Years of the Borrower, and such amount [complies][does not
comply] with clause (d)(ii) of Section 7.2.11 of the Credit Agreement;
(k) No Default has occurred and is continuing [other than
as follows:];
(l) The total market value of precious metal held on
consignment by the Borrower and its Subsidiaries was $__________;
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38
(m) The total number of ounces of precious metal held on consignment at
each Plant (as defined in the Consignment Facilities) under the terms of the
Consignment Facilities was ; and
(n) The total number of ounces of U.S. Bullion (as defined
in the Consignment Facilities) located at each Plant was ______.
(o) Based on paragraph (d) above, the Applicable LIBO Rate Margin is
___%, the Applicable L/C Margin is ___% and the Applicable Commitment Fee Margin
is ___%.
IN WITNESS WHEREOF, the Borrower has caused this Compliance Certificate
to be executed and delivered by its duly Authorized Officer on this ____ day of
_________, 19__.
HANDY & XXXXXX
By______________________________________
Title:
-3-
39
ATTACHMENT 1
(to __/__/__ Compliance
Certificate)
ADJUSTED CONSOLIDATED TANGIBLE NET WORTH
(________ __, 19__)
1. ADJUSTED CONSOLIDATED
TANGIBLE NET WORTH:
A. The par value (or value stated on
the books of the Borrower) of the
capital stock of all classes of the
Borrower..................................................$_________
B. The amount of the consolidated
surplus, whether capital or earned,
of the Borrower and its
and its Subsidiaries..................................... $_________
C. The sum (or difference, in the
case of a surplus deficit in
Item 1.B) of Items 1.A and 1.B........................... $_________
D. The aggregate amount of treasury
stock, subscribed but unissued
stock, unamortized debt discount
and expense, good will, trademarks,
trade names, patents and other
intangible assets (but not deferred
charges) of the Borrower and its
Subsidiaries ............................................ $_________
E. The aggregate amount of all write-
ups in the book value of any assets
owned by the Borrower or its
Subsidiaries subsequent to
March 16, 1992, other than write-ups
of assets (and assets of Subsidiaries)
acquired by the Borrower and/or its
Subsidiaries (exclusive of goodwill)
that are made in connection with the
acquisition thereof ..................................... $_________
F. Sum of Items 1.D through 1.E $_________
--------- ---
G. CONSOLIDATED TANGIBLE NET WORTH:
The excess of Item 1.C over Item 1.F..................... $_________
H. 40% of the excess of the Market
40
Value of the Borrower's and its
Subsidiaries' owned precious metal
holdings over the LIFO cost of such
holdings as set forth in the Borrower's
most recent consolidated financial
statements delivered pursuant to clause
(a) or clause (b) of Section 7.1.1 of
the Credit Agreement..................................... $_________
I. ADJUSTED CONSOLIDATED TANGIBLE NET WORTH:
The sum of Items 1.G and 1.H............................. $_________
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41
ATTACHMENT 2
(to __/__/__ Compliance
Certificate)
LEVERAGE RATIO
(on ___________ __, 19__)
2. (1)LEVERAGE RATIO:
A. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries for
borrowed money and all other
obligations evidenced by bonds,
debentures, notes or other
similar instruments..................................... $_________
B. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries
(without duplication of the
obligations set forth in Item 2.A of
this Attachment 2), whether
contingent or otherwise, relative to
banker's acceptances issued for the
account of the Borrower and its
Subsidiaries ............................................$_________
C. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries as
lessee under leases which have been
or should be, in accordance with
GAAP, recorded as
Capitalized Lease Liabilities........................... $_________
D. Without duplication, Contingent
Liabilities of the Borrower and its
Subsidiaries in respect of any types
of Indebtedness described in
Items 2.A through 2.C .................................. $_________
E. Debt: The Sum of Items 2.A through 2.D................. $_________
--------
1 Computed in accordance with the final sentence contained in the
definition of "Indebtedness".
42
F. Adjusted Consolidated Tangible
Net Worth (from Attachment 1, Item 1.I)................. $_________
G. LEVERAGE RATIO: The ratio
of Item 2.E to Item 2.F................................. ____:1.00
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43
ATTACHMENT 3
(to __/__/__ Compliance
Certificate)
INTEREST COVERAGE RATIO
(on __/__/19__)
3. INTEREST COVERAGE RATIO:
*A. The consolidated net income of the
Borrower and its Subsidiaries
(excluding any extraordinary gains
and losses)........................................ $__________
*B. The aggregate amount of interest
expense of the Borrower and its
Subsidiaries, including the portion
of any rent paid on Capital Lease
Liabilities which is allocable to
interest expense in accordance with
GAAP and including fees or rents
arising from or relating to
consignment or leasing of precious
metals other than up-front fees paid
on the Effective Date to the Lenders
(provided, that any such interest
expense which is subject to a
Hedging Obligation will be
calculated on the net effect of any
payments made by the other party to
such Hedging Obligation)........................... $__________
*C. To the extent deducted in
determining Net Income,
provisions for income taxes........................ $__________
D. EBIT: The sum of Items 3.A
through 3.C........................................ $__________
E. Interest Expense: The amount set
forth in Item 3.B above minus the
effects of the nonrecurring, pre-
tax charges in an aggregate amount
not to exceed $9,500,000 relating to
the Borrower's discontinuance of its
karat gold fabricating product line
--------
* The amount which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries.
44
in East Providence, Rhode Island and
additional costs primarily related
to that division's ongoing operation
in Fairfield, Connecticut.......................... $__________
F. INTEREST COVERAGE RATIO: The ratio
of Item 3.D to Item 3.E............................ ____:1.00
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45
ATTACHMENT 4
(to __/__/__ Compliance
Certificate)
NET DEBT TO EBITDA RATIO
EBITDA TO INTEREST RATIO (on __/__/19__)
4. I. NET DEBT TO EBITDA RATIO:
A. Debt: Item 2.E from Attachment 2..................... $__________
B. The aggregate amount of cash and
Cash Equivalent Investments (not
subject to any Lien or other
encumbrance) owned by the Borrower
and its Subsidiaries on the last day
of the applicable Fiscal Quarter..................... $__________
C. Net Debt: Item 4.A minus Item 4.B................... $__________
*D. EBIT: Item 3.D from Attachment 3..................... $__________
*E. To the extent deducted in
determining Net Income,
provisions for depreciation of assets................ $__________
*F. To the extent deducted in
determining Net Income,
provisions for amortization.......................... $__________
G. EBITDA: The sum of Items 4.D
through 4.F.......................................... $__________
H. NET DEBT TO EBITDA RATIO: The ratio
of Item 4.C to Item 4.G.............................. ____:1.00
II. EBITDA TO INTEREST RATIO:
I. EBITDA: Item 4.G above.............................. $__________
J. Interest Expense: Item 3.E.......................... $__________
K. EBITDA TO INTEREST RATIO: The ratio of
Item 4.I to Item 4.J................................. ____:1.00
--------
* The amount which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries.
46
ATTACHMENT 5
(to __/__/__ Compliance
Certificate)
DESIGNATED DEBT
(as of _________ __, 19__)
5. DESIGNATED DEBT:
A. Current Debt: The aggregate amount
of current maturities of the
consolidated Debt of the Borrower
and its Subsidiaries, determined in
accordance with GAAP................................ $_________
B. The sum of the aggregate outstanding
principal amount of all Loans plus
Letter of Credit Outstandings (as
such terms are defined in the Long
Term Credit Agreement).............................. $_________
C. The sum of Item 5.A and Item 5.B.................... $_________
D. 90% of the Market Value of the gold,
silver and platinum group metals and
the gold, silver and platinum group
metals' content of alloys then owned
by the Borrower and its Subsidiaries
in inventory and not held in
consignment......................................... $_________
E. 75% of the Eligible Receivables of
the Borrower and its Subsidiaries as
computed on Attachment 6 hereto..................... $_________
F. The aggregate amount of cash and
Cash Equivalent Investments of the
Borrower and its Subsidiaries, but
only to the extent that such cash
and Cash Equivalent Investments are
not subject to any Lien and (if held
or owned by a Subsidiary) are
transferable to the Borrower without
the consent or approval of any
other Person........................................ $_________
47
G. The sum of Items 5.D through 5.F.................... $_________
H. The excess of Item 5.C over Item 5.G................ $__________
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48
ATTACHMENT 6
(to __/__/__ Compliance
Certificate)
ELIGIBLE RECEIVABLES
(as of _________ __, 19__)
6. ELIGIBLE RECEIVABLES:
A. Without duplication, the aggregate
amount of Receivables of the
Borrower and its Subsidiaries........................... $_________
B. The amount of such Receivables
lawfully owned by the Borrower or
such Subsidiary which is not free
and clear of Liens (other than Liens
permitted under Section 7.2.3 of the
Credit Agreement)....................................... $_________
C. The amount of such Receivables which
is not valid, binding and legally
enforceable obligations of the
obligor under such Receivable........................... $_________
D. The amount of such Receivables which
is subject to any dispute, setoff,
counterclaim or other claim or
defense on the part of the obligor
thereunder, or which is subject to
any obligor denying liability under
such Receivable in whole or in part..................... $_________
E. The amount of such Receivables which
is not a bona fide Receivable
arising from the sale (on an
absolute, and not a consignment,
approval, or sale-and-return-
basis (subject to the terms of
the parenthetical in clause (d) of
the definition of "Eligible Receivable"
contained in the Credit Agreement))..................... $_________
F. The amount of such Receivables which
is payable more than 90 days after
the shipping of goods giving rise to
such Receivable, or is more than
60 days past due........................................ $_________
G. The amount of such Receivables
which have been written off or
reserved against........................................ $_________
49
H. The amount of such Receivables which
is the obligation of an obligor that
is either an Affiliate of the
Borrower, or the subject of any
reorganization, bankruptcy,
receivership, custodianship,
insolvency or like proceeding or any
event of the nature set forth in
clauses (a) through (d) of Section
8.1.9 of the Credit Agreement........................... $_________
I. The sum of Items 6.B through 6.H........................ $_________
J. Item 6.A minus Item 6.I................................. $_________
K. 75% of the amount of the GO/XXX
Receivable.............................................. $_________
L. ELIGIBLE RECEIVABLES: Item 6.J plus
Item 6.K................................................ $_________
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