EXECUTION COPY
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Exhibit 10.26
AMENDMENT NO. 1 TO SUBORDINATED SECURED CREDIT AGREEMENT
dated as of October 11, 2002
by and among
SAFETY COMPONENTS INTERNATIONAL, INC.,
AUTOMOTIVE SAFETY COMPONENTS INTERNATIONAL LIMITED
and
AUTOMOTIVE SAFETY COMPONENTS INTERNATIONAL GMBH & CO. KG,
as Borrowers,
THE OTHER SUBSIDIARIES OF SAFETY COMPONENTS INTERNATIONAL, INC. NAMED HEREIN
as Guarantors,
KEYBANK NATIONAL ASSOCIATION
as Administrative Agent
and
FLEET NATIONAL BANK
and
KEYBANK NATIONAL ASSOCIATION
as Lenders
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AMENDMENT NO. 1 TO SUBORDINATED SECURED CREDIT AGREEMENT
THIS AMENDMENT NO. 1 TO SUBORDINATED SECURED CREDIT AGREEMENT, dated as of
October 11, 2002 (this "Amendment"), by and among (1) SAFETY COMPONENTS
INTERNATIONAL, INC., a Delaware corporation ("Safety Components"), AUTOMOTIVE
SAFETY COMPONENTS INTERNATIONAL LIMITED, a company organized under the laws of
the United Kingdom, and AUTOMOTIVE SAFETY COMPONENTS INTERNATIONAL GMBH & CO.
KG, a company organized under the laws of the Federal Republic of Germany, as
borrowers (the "Borrowers"), (2) the direct and indirect subsidiaries of Safety
Components listed on the signature pages hereto as guarantors (the
"Guarantors"), (3) KEYBANK NATIONAL ASSOCIATION ("KeyBank") and FLEET NATIONAL
BANK, as lenders (the "Lenders"), and (4) KeyBank, as administrative agent for
the Lenders (the "Administrative Agent").
WITNESSETH:
WHEREAS, the Borrowers, the Guarantors, the Lenders and the Administrative
Agent have heretofore entered into that certain Subordinated Secured Credit
Agreement, dated as of October 11, 2000 (as supplemented by that certain
Supplement to Subordinated Secured Credit Agreement, dated as of October 13,
2000 and as may be further amended, supplemented or otherwise modified from time
to time, the "Credit Agreement");
WHEREAS, the Borrowers have advised the Lenders that they desire to obtain
a one-year extension of the Credit Agreement, which currently provides for of a
$20,900,000 two-year term loan facility due on October 11, 2002, of which
$15,861,000 is outstanding on the date hereof (the "Term Loans");
WHEREAS, the Borrowers, the Guarantors, the Lenders and the Administrative
Agent have agreed (i) to amend the Credit Agreement to provide for an extension
of the maturity date of the Term Loans for an additional one-year period ending
on October 10, 2003 on substantially the same terms and conditions set forth in
the Credit Agreement, (ii) to provide for a prepayment of the principal amount
of the Term Loans in the amount of $5,000,000, (iii) to provide for certain
quarterly principal payments in respect of the Term Loans and (iv) to amend the
Credit Agreement in certain other respects as set forth herein.
NOW THEREFORE, in consideration of the premises set forth above, the terms
and conditions contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Certain Defined Terms. The following terms (whether or not
underscored) when used in this Amendment, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof, as the case may require):
"Amendment" is defined in the preamble.
"Amendment No. 1 to Intercreditor Agreement" means that certain Amendment
No. 1 to the Intercreditor and Subordination Agreement, dated of even date
herewith, by and among the Senior Lender, the Administrative Agent and the
Lenders.
"Amendment No. 2 to Loan and Security Agreement" means that certain
Amendment No. 2 to Loan and Security Agreement, dated of even date herewith, by
and among the Senior Lender, the Borrowers and the Guarantors.
"Credit Agreement" is defined in the first recital.
SECTION 1.2 Use of Defined Terms. Unless otherwise defined or the context
otherwise requires, terms for which meanings are provided in the Credit
Agreement shall have such meanings when used in this Amendment.
ARTICLE II
AMENDMENT
SECTION 2.1 Amendment to Schedule 3 of the Credit Agreement (Definitions).
The definition of "Maturity Date" is amended by deleting the date "October 11,
2002" and replacing it with the date "October 10, 2003".
SECTION 2.2 Amendment to Article 3 of the Credit Agreement (Mandatory
Prepayments). Article 3 is hereby amended to read in its entirety as follows:
"SECTION 3.1 On or prior to the date which is 45 days after
the last day of each of Safety Component's fiscal quarters
ending on or about September 30, 2002 and December 31, 2002,
to the extent Consolidated EBITDA exceeds $3,750,000 for such
fiscal quarter, the Borrowers shall make a mandatory
prepayment of the Term Loans in an amount equal to 65% of the
amount of Consolidated EBITDA in excess of $3,750,000.
SECTION 3.2 On or prior to the date which is (a) 90 days after
the last day of Safety Component's fiscal quarter ending on or
about March 31, 2003 and (b) 45 days after the last day of
Safety Component's fiscal quarter ending on or about June 30,
2003 (the fiscal quarters ending on or about March 31, 2003
and June 30, 2003 are hereinafter referred to as the
"Specified Fiscal Quarters"), the Borrowers shall make
mandatory prepayments of the Term Loans in an amount equal to
the greater of (i) to the extent Consolidated EBITDA exceeds
$3,750,000 for such fiscal quarter, 65% of the amount of
Consolidated EBITDA in excess of $3,750,000 and (ii)
$1,000,000; provided that,
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if (A) for any of the thirty (30) consecutive days immediately
prior to the date of any such prepayment, the aggregate Excess
Availability (as defined in Senior Exit Facility Credit
Agreement) of Borrowers shall have been less than $5,000,000
or (B) as of the date of any such prepayment and after giving
effect thereto, the aggregate Excess Availability of the
Borrowers shall be less than $5,000,000, then the amount of
such prepayment shall be the amount specified in clause (i)
above; provided, further, that in the case of any prepayment
which is less than $1,000,000 in the aggregate (or in the
event that no prepayment is made because Consolidated EBITDA
is less than $3,750,000) for any Specified Fiscal Quarter
because of the application of clauses (A) and (B) above, a
subsequent prepayment shall thereafter be made by Borrowers
with respect to such Specified Fiscal Quarter in an amount
equal to $1,000,000 less the amount previously prepaid in
respect of such Specified Fiscal Quarter so long as the
aggregate Excess Availability of Borrowers shall have been not
less than $5,000,000 for each of the thirty (30) consecutive
days immediately prior to the date of any subsequent
prepayment and as of the date of any such subsequent
prepayment and after giving effect thereto, the aggregate
Excess Availability of Borrowers shall be not less than
$5,000,000. For purposes of calculating the amount of Excess
Availability pursuant to this Section, the Maximum Credit (as
defined in the Senior Exit Facility Credit Agreement) shall be
deemed to be $35,000,000."
ARTICLE III
CONDITIONS PRECEDENT
This Amendment shall be effective as of the date hereof, subject to the
prior or concurrent satisfaction of each of the conditions precedent set forth
in this Article III.
SECTION 3.1 Execution and Delivery of Documents.
(a) The Administrative Agent and the Lenders shall have received a
duly authorized and executed copy of this Amendment;
(b) The Administrative Agent and the Lenders shall have received
duly authorized and executed copies of Amendment No. 1 to the Intercreditor
Agreement and Amendment No. 2 to Loan and Security Agreement, in form and
substance satisfactory to the Administrative Agent and the Lenders, pursuant to
which the Senior Lender consents to the terms of this Amendment; and
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(c) To the extent not previously delivered to the Administrative
Agent, the Administrative Agent and the Lenders shall have received duly
authorized and executed copies of all Security Documents and guarantees,
including any supplements or amendments to any of the foregoing, required to be
delivered by any Borrower or Guarantor under the Credit Agreement in form and
substance satisfactory to the Administrative Agent and the Lenders.
SECTION 3.2 Compliance with Warranties, No Default, etc. The following
statements shall be true and correct as of the date hereof after giving effect
to the amendments contemplated hereby:
(a) the representations and warranties set forth in Article VI of
the Credit Agreement, and to the extent incorporated therein, in Section 8 of
the Senior Exit Facility Credit Agreement, shall, in each case, be true and
correct with the same effect as if made on the date hereof (unless stated to
relate solely to an earlier date, in which case such representations and
warranties shall be true and correct as of such earlier date); and
(b) no Event of Default shall have occurred and be continuing.
SECTION 3.3 Satisfactory Legal Form. All documents executed or submitted
pursuant hereto by or on behalf of any Obligor shall be satisfactory in form and
substance to the Lenders and their counsel; and the Lenders and their counsel
shall have received all information, approvals, opinions, documents or
instruments as the Lenders or their counsel may have reasonably requested.
SECTION 3.4 Mandatory Prepayment. The Borrowers shall have made a
mandatory prepayment of principal of the outstanding Term Loans in the amount of
$5,000,000.
SECTION 3.5 Fees, etc.
(a) The Borrowers shall have paid pro rata to the Lenders in
accordance with their respective outstanding Term Loans a renewal fee in the
aggregate amount of $270,000.
(b) The Borrowers shall have paid in full all reasonable fees and
expenses of Xxxxx, Day, Xxxxxx & Xxxxx, counsel to the Lenders.
(c) The Borrowers shall have paid in full all other fees and
expenses required to be paid to the Lenders or the Administrative Agent on or
prior to the date hereof.
SECTION 3.6 Opinion. The Administrative Agent shall have received a duly
executed opinion of Xxxxxx & Bird LLP, counsel to the Borrowers and the
Guarantors substantially in the form of Exhibit A attached hereto.
SECTION 3.7 Perfection Certificate. The Administrative Agent shall have
received a duly executed and completed perfection certificate from each Borrower
and each Guarantor organized in the United States substantially in the form of
Exhibit B attached hereto; provided, that within ten (10) business days from the
date hereof, each Borrower and each Guarantor shall provide the Administrative
Agent with a revised duly executed and completed perfection
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certificate setting forth updated, true and correct information with respect to
Sections 5, 6 and 7 therein.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders to enter into this Amendment, each Obligor
hereby reaffirms, as of the date hereof, its representations and warranties
contained in Article VI of the Credit Agreement and additionally represents and
warrants unto each Lender as set forth in this Article IV:
SECTION 4.1 Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by each Obligor of this Amendment and each other
document executed or to be executed by it in connection with this Amendment, are
within each such Obligor's corporate powers, have been duly authorized by all
necessary corporate action, and do not:
(a) contravene any Obligor's organizational documents;
(b) contravene any contractual restriction, law or governmental
regulation or court decree or order binding on or affecting any Obligor or
(c) result in, or require the creation or imposition of, any Lien on
any of any Obligor's properties.
SECTION 4.2 Government Approval, Regulation, etc. No authorization or
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body or other Person is required for the due execution,
delivery or performance by any Obligor of this Amendment or any other documents
to be executed by any such Obligor in connection with this Amendment.
SECTION 4.3 Validity, etc. This Amendment constitutes, and each other
document executed by each Obligor in connection with this Amendment will, on the
due execution and delivery thereof, constitute, the legal, valid and binding
obligations of such Obligor enforceable in accordance with their respective
terms.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.1 Ratification of and References to the Credit Agreement. This
Amendment shall be deemed to be an amendment to the Credit Agreement, and the
Credit Agreement, as amended hereby, and each Security Document, guarantee and
each other document or instrument entered into in connection therewith, and the
obligations of each Obligor thereunder, are hereby ratified, approved and
confirmed in each and every respect. All references to the Credit Agreement in
any other document, instrument, agreement or writing shall hereafter be deemed
to refer to the Credit Agreement as amended hereby.
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SECTION 5.2 Filings. Each of the Borrowers and Guarantors hereby
authorizes the Administrative Agent to file a record or records (as defined in
Article 9 of the Uniform Commercial Code), including, without limitation,
financing statements, continuation statements and amendments thereto, in all
jurisdictions and with all filing offices as the Administrative Agent may
determine, in its sole discretion, are necessary or advisable to perfect the
security interest granted to the Administrative Agent under the Credit Agreement
and the Security Documents, without the signature of the Borrowers and the
Guarantors. Such financing statements may describe the Collateral in the same
manner as described in the Credit Agreement or the Security Documents or may
contain an indication or description of collateral that describes such property
in any other manner as the Administrative Agent may determine, in its sole
discretion, is necessary, advisable or prudent to ensure the perfection of the
security interest in the Collateral granted to the Administrative Agent under
the Credit Agreement and the Security Documents, including, without limitation,
describing such property as "all assets" or "all personal property." The
Borrowers and Guarantors agree that a carbon, photographic or other reproduction
of the Credit Agreement or the Security Documents or of a financing statement
signed by any of the Borrowers or Guarantors shall be sufficient as a financing
statement and may be filed as a financing statement in any and all
jurisdictions.
SECTION 5.3 Headings. The various headings of this Amendment are inserted
for convenience only and shall not affect the meaning or interpretation of this
Amendment or any provisions hereof.
SECTION 5.4 Execution in Counterparts. This Amendment may be executed by
the parties hereto in several counterparts, each of which shall be executed by
the Borrowers, the Guarantors, the Lenders and the Administrative Agent and be
deemed to be an original and all of which shall constitute together but one and
the same agreement.
SECTION 5.5 No Other Consents, Amendments or Waivers. Except for the
amendments and consents expressly set forth above, the text of the Credit
Agreement shall remain unchanged and in full force and effect, and the Lenders
expressly reserve the right to require strict compliance with the terms of the
Credit Agreement and the other documents executed in connection therewith.
SECTION 5.6 Governing Law; Entire Agreement. THIS AMENDMENT AND EACH OTHER
DOCUMENT EXECUTED IN CONNECTION HEREWITH SHALL EACH BE DEEMED TO BE A CONTRACT
MADE UNDER AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, INCLUDING WITHOUT
LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW. This
Amendment and the other documents executed in connection herewith constitute the
entire understanding among the parties hereto with respect to the subject matter
hereof and supercede any prior agreements, written or oral, with respect
thereto.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
BORROWERS: SAFETY COMPONENTS INTERNATIONAL, INC.
By:___________________________________
Its:__________________________________
AUTOMOTIVE SAFETY COMPONENTS
GMBH & CO. KG
By:___________________________________
Its:__________________________________
AUTOMOTIVE SAFETY COMPONENTS
INTERNATIONAL LIMITED
By:___________________________________
Its:__________________________________
GUARANTORS: ASCI HOLDINGS GERMANY (DE), INC.
By:___________________________________
Its:__________________________________
ASCI HOLDINGS U.K. (DE), INC.
By:___________________________________
Its:__________________________________
ASCI HOLDINGS MEXICO (DE), INC.
By:___________________________________
Its:__________________________________
ASCI HOLDINGS CZECH (DE), INC.
By:___________________________________
Its:__________________________________
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AUTOMOTIVE SAFETY COMPONENTS
INTERNATIONAL, INC.
By:___________________________________
Its:__________________________________
AUTOMOTIVE SAFETY COMPONENTS
INTERNATIONAL, S.A. de C.V.
By:___________________________________
Its:__________________________________
AUTOMOTIVE SAFETY COMPONENTS
INTERNATIONAL S.R.O.
By:___________________________________
Its:__________________________________
GALION, INC.
By:___________________________________
Its:__________________________________
SAFETY COMPONENTS FABRIC
TECHNOLOGIES, INC.
By:___________________________________
Its:__________________________________
VALENTEC XXXXX, LLC (formerly known as Valentec
International Corporation, LLC)
By:___________________________________
Its:__________________________________
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ADMINISTRATIVE AGENT: KEYBANK NATIONAL ASSOCIATION
By:___________________________________
Its:__________________________________
LENDERS: KEYBANK NATIONAL ASSOCIATION
By:___________________________________
Its:__________________________________
FLEET NATIONAL BANK
By:___________________________________
Its:__________________________________
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