THIS THIRD SUPPLEMENTAL AGREEMENT is dated 15th February, 2002 between:
(1) DUNLOP STANDARD AEROSPACE GROUP LIMITED (registered no. 3573726) an
English company with its registered office at Xxxxxxxx Xxxx,
Xxxxxxxx, XX0 0XX (the "Company");
(2) THE OBLIGORS listed in Schedule 1;
(3) THE FUJI BANK, LIMITED as arranger of the Facilities (in this
capacity the "Arranger");
(4) THE FUJI BANK, LIMITED as agent for the Lenders set out in Schedule 2
(in this capacity the "Facility Agent");
(5) THE FUJI BANK, LIMITED as security agent and trustee for the Lenders
(in this capacity the "Security Agent"); and
(6) THE FUJI BANK, LIMITED as syndication manager (in this capacity the
"Syndication Agent").
WHEREAS:
(A) This Third Supplemental Agreement is supplemental to a credit
agreement dated 31st July, 1998 (as supplemented and amended by a
Supplemental Credit Agreement dated 28th September, 1998 and a Second
Supplemental Agreement dated 7th May, 1999, the "Original Credit
Agreement") made between, inter alia, the Parent, the Arranger, the
Original Lenders and The Fuji Bank, Limited as Facility Agent and
Security Agent pursuant to which the Lenders agreed to make available
to the Borrowers certain term loan facilities, capital expenditure
facilities and revolving credit facilities.
(B) The Company has requested certain amendments to the Senior Finance
Documents.
(C) The parties to this Third Supplemental Agreement have agreed to
supplement and amend the Original Credit Agreement on the terms set
out below.
IT IS AGREED as follows:
1. INTERPRETATION
(a) Capitalised terms not otherwise defined in this Third Supplemental
Agreement have the meanings given to them in the Original Credit
Agreement, unless the context otherwise requires.
(b) Terms defined in the Recitals hereto have the same meaning when used
in this Third Supplemental Agreement.
(c) Clause 1.2 of the Original Credit Agreement is deemed to be set out
in full in this Third Supplemental Agreement but as if references to
the Original Credit Agreement are references to this Third
Supplemental Agreement.
2. AMENDMENTS TO THE ORIGINAL CREDIT AGREEMENT
(a) The parties to this Third Supplemental Agreement hereby agree for
themselves and for their successors, transferees and assigns pursuant
to the Original Credit Agreement that, subject to paragraph (b)
below, upon the Facility Agent confirming to the Company its
satisfaction of the conditions set out in Schedule 3 hereto, the
Original Credit Agreement shall be supplemented and amended by this
Third Supplemental Agreement as follows:
(i) Clause 1.1 (Definitions) of the Original Credit Agreement
shall be amended such that:
(A) the following definition will be inserted in Clause
1.1 (Definitions):
"CF 34 Project" means the business to be conducted
by the Group in connection with the maintenance,
repair and overhaul service agreement for General
Electric CF 34 engines dated 10th September, 2001;
and
(B) the references to "31st January, 2000" and "31st
January, 2001" in the definition of "Investors
Capex Contribution Amount" will be deleted and
replaced by "30th September, 2002" and "30th June,
2003" respectively;
(C) the definition of "Margin" will be deleted and
replaced by:
"Margin" means:
(a) in respect of any Tranche A Advance or
Tranche D Utilisation, two per cent
(2.00%) per annum, save as adjusted
pursuant to Clause 10.4;
(b) in respect of any Tranche B Advance, two
point five per cent (2.50%) per annum; and
(c) in respect of any Tranche C Advance or
Tranche E Utilisation, two point seven
five per cent (2.75%) per annum.
(ii) Clause 3 (c) (Purpose) of the Original Credit Agreement
shall be amended by the addition of the words "incurred in
connection with the CF 34 Project" after the words "Capital
Expenditure";
(iii) the words "the Margin shall be one point six two five per
cent." to "one per cent (1.00%) per annum" (inclusive) in
Clause 10.4 (Margin Adjustment) shall be deleted and
replaced by:
"the Margin shall be one point eight seven five per cent.
(1.875%) per annum, if the test in sub-paragraph (II) above
is met the Margin shall be one point six two five per cent
(1.625%) per annum and if the test in sub-paragraph (III)
above is met the Margin shall be one point two five per cent
(1.25%) per annum",
and the words "one point seven five zero per cent (1.750%)
per annum" in paragraph (B) of that Clause will be deleted
and replaced by "two per cent (2.00%) per annum";
(iv) The "." at the end of paragraph (xii) of the definition of
"Consolidated Cash Flow" in Clause 22.1 (a) (Definitions)
with be replaced by a ";" and a new paragraph (xiii) will be
added to that Clause as follows:
"plus the amount of any loan drawn down during that period
by a member of the Group, from a governmental institution to
fund Capital Expenditures by a member of the Group";
(v) the table set out in Clause 22.2 (a) (Consolidated EBIT to
Consolidated Net Interest Payable) will be amended so that
the values set out in Column Y of that table opposite the
dates set out below will be as set out below opposite those
dates:
Dates Y
31st December, 2001 1.55
31st March, 2002 1.55
30th June, 2002 1.60
30th September, 2002 1.65
31st December, 2002 1.70
31st March, 2003 1.75
30th June, 2003 1.80
30th September, 2003 1.80
31st December, 2003 1.85
31st March, 2004 1.90
30th June, 2004 1.90
30th September, 2004 2.00
31st December, 2004 2.00
31st March, 2005 2.05
30th June, 2005 2.05
30th September, 2005 2.15
31st December, 2005 2.15
31st March, 2006 2.15
30th June, 2006 2.15
30th September, 2006 2.15
31st December, 2006 2.20
31st March, 2007 2.20
30th June, 2007 2.20
30th September, 2007 2.20
(vi) the table set out in Clause 22.2 (c) (Total Net Debt to
Consolidated Net Worth) will be amended so that the values
set out in column B of that table opposite the dates set out
below will be as set out below opposite those dates:
Dates B
31st December, 2001 2.45
30th June, 2002 1.90
31st December, 2002 1.90
30th June, 2003 1.65
31st December, 2003 1.60
30th June, 2004 1.60
31st December, 2004 1.55
30th June, 2005 1.55
31st December, 2005 1.55
30th June, 2006 1.50
31st December, 2006 1.50
30th June, 2007 1.50
(vii) the table set out in Clause 22.2 (d) (Total Net Senior Debt
to Consolidated EBITDA) will be amended so that the values
set out in column Y of that table opposite the dates set out
below will be as set out below opposite those dates:
Dates Y
31st December, 2001 3.65
30th June, 2002 3.00
31st December, 2002 3.00
30th June, 2003 2.60
31st December, 2003 2.60
30th June, 2004 2.55
31st December, 2004 2.55
30th June, 2005 2.55
31st December, 2005 2.50
30th June, 2006 2.50
31st December, 2006 2.45
30th June, 2007 2.45
(viii) the table set out in Clause 22.3 (a) (Capital Expenditure)
will be amended so that the values set out in column (2) of
that table opposite the dates set out below will be as set
out below opposite those dates:
(1) (2)
Accounting Dates Capital Expenditure
31st December, 2001 29,800,000
31st December, 2002 41,200,000
31st December, 2003 25,300,000
31st December, 2004 25,700,000
31st December, 2005 28,400,000
31st December, 2006 26,500,000
31st December, 2007 27,500,000
; and
(ix) the "." at the end of paragraphs "(t)(iii)" and "(y)" of
Clause 23.1 (Events of Default) shall be deleted and
replaced by "; or" and a new paragraph (z) will be added to
that Clause as follows:
"(z) Investors Capex Contributions": any Investors Capex
Contribution Amount is not invested in the Company
by the relevant date referred to the definition of
that term in Clause 1.1 (Definitions)."
(b) The cancellation referred to in Clause 6 and the amendments to the
Original Credit Agreement set out in this Clause 2 shall not come
into effect and shall be automatically cancelled or revoked unless
the Facility Agent has confirmed to the Company and the Lenders that
all the conditions set out in Schedule 3 have been satisfied before
close of business in London on 28th February, 2002.
3. REPRESENTATIONS AND WARRANTIES
Each Obligor represents and warrants to the Agents and each Lender
that on the date hereof and on the date on which the Original Credit
Agreement is amended as set out in Clause 2:
(a) Powers and authority: It has the power to enter into and has
taken all necessary action to authorise the entry into and
delivery of, this Third Supplemental Agreement and the
transactions contemplated by this Third Supplemental
Agreement (including, without limitation, under the Original
Credit Agreement as supplemented and amended by this Third
Supplemental Agreement).
(b) Legal Validity: Subject to the Reservations, this Third
Supplemental Agreement constitutes, and the Original Credit
Agreement when supplemented and amended by this Third
Supplemental Agreement will constitute, its legal, valid and
binding obligation.
(c) Non-conflict: The entry into and performance by it of, and
the transactions contemplated by, this Third Supplemental
Agreement and the Original Credit Agreement (as supplemented
and amended by this Third Supplemental Agreement) do not and
will not:
(i) conflict in any material respect with any law or
regulation or any official or judicial order
applicable to it; or
(ii) conflict with its constitutional documents; or
(iii) conflict in any respect with, or entitle any third
party to terminate, any agreement or document which
is binding upon it, any other member of the Group
or any asset of any member of the Group in a manner
or to an extent which might have a Material Adverse
Effect or would be reasonably likely to have a
material adverse effect on the business assets or
financial condition of the Company, any Borrower or
any Material Group Subsidiary or in a manner or to
an extent which could result in any liability on
the part of any Finance Party to any third party.
(d) Authorisations:
(i) All authorisations required by any Obligor in connection with the
entry into, performance, validity and enforceability of, and the
transactions contemplated by this Third Supplemental Agreement
(including, without limitation, under the Original Credit Agreement)
have been obtained or effected (as appropriate) and are in full force
and effect.
(ii) The Obligors' Agent has been duly authorised by each of the other
Obligors to execute this Third Supplemental Agreement on their
behalf.
4. INCORPORATION
(a) This Third Supplemental Agreement is a Senior Finance Document for
the purposes of the Original Credit Agreement and the other Senior
Finance Documents.
(b) This Third Supplemental Agreement shall, from the date of this Third
Supplemental Agreement, be deemed to be incorporated as part of the
Original Credit Agreement.
(c) Except as otherwise expressly provided in this Third Supplemental
Agreement, the Senior Finance Documents remain in full force and
effect.
5. GUARANTEES AND SECURITY
Each Guarantor consents to the amendments to the Original Credit
Agreement as set out in Clause 2 of this Third Supplemental Agreement
and:
(a) confirms and agrees that its guarantee of the obligations
and liabilities of the other Obligors under the Senior
Finance Documents remains in full force and effect and will
remain in full force and effect; and
(b) confirms that the charges and security interests created
under the Security Documents continue in full force and
effect.
6. CANCELLATION OF TRANCHE E COMMITMENTS
(a) Subject to Clause 2(b), the Tranche E Commitments of each lender will
as from the date of this Third Supplemental Agreement be reduced and
cancelled by a pro rata amount such that following that reduction and
cancellation the aggregate of the Tranche E Commitment is
(pound)49,100,000.
(b) No Borrower may deliver a request for utilisation of the Tranche E
Facility on or after the date of this Third Supplemental Agreement
until the condition set out in Clause 2 (b) has been satisfied.
7. MISCELLANEOUS
(a) The provisions of Clauses 26 (Expenses), 29 (Amendments and Waivers),
36 (Notices) and 37 (Jurisdiction) of the Original Credit Agreement
shall apply to this Third Supplemental Agreement as though they were
set out in this Third Supplemental Agreement in full, but as if
references in those Clauses to the Original Credit Agreement were
references to or included this Third Supplemental Agreement.
(b) Unless expressly provided to the contrary in this Third Supplemental
Agreement, a person who is not a party to this Third Supplemental
Agreement may not enforce or enjoy the benefit of any of its terms
under the Contracts (Rights of Third Parties) Xxx 0000.
8. COUNTERPARTS
This Third Supplemental Agreement may be executed in any number of
counterparts, and this has the same effect as if the signatures on
the counterparts were on a single copy of this Third Supplemental
Agreement.
9. GOVERNING LAW
This Third Supplemental Agreement is governed by English law.
This Third Supplemental Agreement has been entered into on the date stated at
the beginning of this Third Supplemental Agreement.
SCHEDULE 1
The Obligors (other than the Company)
Dunlop Standard Aerospace (UK) Limited
Xxxxx Aviation Limited
Dunlop Standard Aerospace Overseas Limited
Dunlop Standard Aerospace (US) Inc.
Dunlop Standard Aerospace Holdings plc (previously known as Dunlop Standard
Aerospace Holdings Limited)
Standard Aero Limited
Dunlop Aviation Canada Inc.
Dunlop Aviation North America Inc.
Standard Aero Inc.
Xxxxxxx Xxxxxx South Wind Corporation
Standard Aero (Alliance) Inc.
Dunlop Holdings Limited
Dunlop Limited
Dunlop Aerospace Limited
SCHEDULE 2
Lenders
The Fuji Bank, Limited
The Bank of Nova Scotia
The Royal Bank of Scotland plc
The Governor and Company of the Bank of Scotland
Dresdner Bank AG London Branch
The Industrial Bank of Japan Limited
ABN AMRO Bank N.V.
General Electric Corporation
Sanwa International Plc
Sumitomo Mitsui Banking Corporation
PPM UK Limited
UBS AG
Abbey National Treasury Services
Lloyds TSB Bank plc
SCHEDULE 3
Conditions Precedent
1. Receipt by the Facility Agent (in form and substance satisfactory to it) of
each of the following:
(a) a certified copy of a resolution of the board of directors of the
Company:
(i) approving the terms of, and the transactions
contemplated by, the Third Supplemental Agreement
and the Original Credit Agreement as supplemented
and amended by the Third Supplemental Agreement;
(ii) noting that it has due authority, pursuant to
Clause 2.4 (Obligors' Agent) of the Original Credit
Agreement, from each other Obligor to execute the
Third Supplemental Agreement as Obligors' Agent on
its behalf; and
(iii) authorising specified persons to execute the Third
Supplemental Agreement and the Assignment (as
defined below);
(b) a certificate from the Obligors' Agent confirming that there
has been no change to the constitutional documents of the
Obligors from those previously delivered to the Facility
Agent or, if there has been any such change, specifying the
changes together with a copy of the articles of association
of the Company;
(c) a certificate signed by two directors of the Company
confirming that there is then no outstanding Default;
(d) a legal opinion of Xxxxx & Xxxxx, English legal advisers to
the Lenders;
(e) an undertaking (the "Undertaking") made by the limited
partnerships together constituting the Xxxxxxx Xxxxxx Fund
III (the "Limited Partnerships") in favour of the Company to
subscribe for Preference Shares in the capital of the
Company in an amount of (pound)5,000,000 on or before each
of 30th September, 2002 and 30th June, 2003 or, if earlier,
in full on the occurrence of an Event of Default together
with an assignment of the benefit of the Undertaking by the
Company to the Security Agent (the "Assignment") and
acknowledgements of the notices of the Assignment duly
executed by each Limited Partnership;
(f) a legal opinion of Lovells regarding the Undertaking; and
(g) a duly executed fees letter in connection with this Third
Supplemental Agreement.
2. The Facility Agent has received the fees set out in the fees letter
referred to in paragraph 1.(g) above.
SIGNATORIES TO THE THIRD SUPPLEMENTAL AGREEMENT
Company
DUNLOP STANDARD AEROSPACE GROUP LIMITED
By: XXX XXXXX
The Obligors' Agent (on behalf of each Obligor other than the Company)
DUNLOP STANDARD AEROSPACE GROUP LIMITED (as Obligors' Agent)
By: XXXXX XXXXX
XXX XXXXX
Arranger
THE FUJI BANK, LIMITED
By: XXXXX XXXXXXX
Facility Agent (for and on behalf of itself and the other Lenders)
THE FUJI BANK, LIMITED
By: XXXXX XXXXXXX
Security Agent
THE FUJI BANK, LIMITED
By: XXXXX XXXXXXX
Syndication Agent
THE FUJI BANK, LIMITED
By: XXXXX XXXXXXX
CONFORMED COPY
THIRD SUPPLEMENTAL
AGREEMENT
DATED 15th February, 2002
Between
DUNLOP STANDARD AEROSPACE GROUP LIMITED
and certain of its Subsidiaries as Borrowers and/or Guarantors
THE FUJI BANK, LIMITED
as Arranger
THE LENDERS
THE FUJI BANK, LIMITED
as Facility Agent and Security Agent
and
THE FUJI BANK, LIMITED
as Syndication Agent
___________________________________________
relating to a Credit Agreement dated
31st July, 1998 as supplemented and
amended by a Supplemental Credit
Agreement dated 28th September, 1998
and a Second Supplemental Agreement
dated 7th May, 1999
_____________________________________________
XXXXX & XXXXX
London
CONTENTS
Clause Page
1. Interpretation.....................................................1
2. Amendments to the Original Credit Agreement........................2
3. Representations and Warranties.....................................5
4. Incorporation......................................................6
5. Guarantees and Security............................................6
6. Cancellation of Tranche E Commitments..............................7
7. Miscellaneous......................................................7
8. Counterparts.......................................................7
9. Governing Law......................................................7
Schedules
Schedule 1 - The Obligors...................................................8
Schedule 2 - Lenders........................................................9
Schedule 3 - Conditions Precedent..........................................10
Signatories................................................................11
