EXHIBIT 10rr
TENTH AMENDMENT
TO MASTER LEASE AGREEMENT AND EQUIPMENT SCHEDULES
THIS TENTH AMENDMENT TO MASTER LEASE AGREEMENT AND EQUIPMENT SCHEDULES
("this Tenth Amendment") is made and entered into as of the 7th day of March,
2003, by BRUSH XXXXXXX INC., an Ohio corporation (the "Lessee"), and NATIONAL
CITY BANK, a national banking association, for itself and as agent for certain
participants (the "Lessor").
RECITALS:
A. The Lessee and the Lessor entered into a Master Lease Agreement,
dated as of December 30, 1996, as amended by the First Amendment to Master Lease
Agreement, dated as of September 2, 1997, the Second Amendment to Master Lease
Agreement and Amendment to Disbursement Schedules, dated as of January 26, 1999,
the Third Amendment to Master Lease Agreement and Amendment to Equipment
Schedules, dated as of September 30, 1999, the Fourth Amendment to Master Lease
and Waiver, dated as of May 16, 2000, and Consolidated Amendment No.1 to Master
Lease Agreement and Equipment Schedules, dated as of June 30, 2000, Consolidated
Amendment No.2 to Master Lease Agreement and Equipment Schedules, dated as of
March 30, 2001, Consolidated Amendment No.3 to Master Lease Agreement and
Equipment Schedules, dated as of September 28, 2001, an Eighth Amendment to
Master Lease Agreement and Equipment Schedules, dated as of December 31, 2001,
and a Ninth Amendment to Master Lease Agreement and Equipment Schedules, dated
as of January 29, 2003 (collectively, together with all Exhibits and Schedules
thereto, the "Lease Agreement"), under which the Lessor agreed to lease to the
Lessee certain equipment to be used by the Lessee at its Elmore, Ohio, facility,
subject to certain conditions and in accordance with the terms thereof.
B. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Lease Agreement.
C. The Lessor and the Lessee have agreed to amend the Lease Agreement
as hereinafter set forth.
AGREEMENTS:
NOW, THEREFORE, in consideration of the foregoing Recitals and the
mutual agreements hereinafter set forth, the parties hereby agree as follows:
1. Amendments to the Lease Agreement. Subject to the terms and
conditions of this Tenth Amendment, including, without limitation, Section 2,
below, the Lease Agreement is hereby amended as follows:
A. The clauses designated as "(i)" and "(ii)" of Paragraph (iv) of
Section XI(a) of the Lease Agreement (Default) are re-designated to be "(A)" and
"(B)"; respectively, and the following provision is added to the end of said
Paragraph (iv) as a new clause (C) thereof:
or (C) there shall occur an "Event of Default" as that term is defined
and used in the Credit Agreement,
B. Paragraph (ix) of Section XI(a) of the Lease Agreement (Default) is
amended by deleting therefrom the sum "$5,000,000" and inserting the sum
"$1,000,000" in its stead.
C. Paragraph (a) of Section XXIII of the Lease Agreement (Ratio of
Consolidated Total Debt to Consolidated Total Adjusted Capital and Interest
Coverage Ratio) is amended and restated in its entirety to provide as follows:
(a) INTEREST COVERAGE RATIO. The Lessee shall not permit the
Interest Coverage Ratio for the Testing Period ending on any of the
following dates to be less than the ratio set forth below opposite such
date:
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Testing Period Ending Minimum Ratio
--------------------- -------------
June 30, 2003 1.20 to 1
September 30, 2003 1.25 to 1
December 31, 2003 1.35 to 1
March 31, 2004 1.50 to 1;
provided, however, that for the purposes of this Paragraph (a)
only, in computing the Interest Coverage Ratio for the Testing Period
ending June 30, 2003, Consolidated EBITDAR shall be deemed to mean an
amount equal to Consolidated EBITDAR for the period January 1, 2003
through June 30, 2003, times two (2); and, in computing the Interest
Coverage Ratio for the Testing Period ending September 30, 2003,
Consolidated EBITDAR shall be deemed to mean an amount equal to
Consolidated EBITDAR for the period January 1, 2003 through September
30, 2003, times one and one-third (1 1/3).
D. Paragraph (b) of Section XXIII of the Lease Agreement (Ratio of
Consolidated Total Debt to Consolidated EBITDAR) is amended and restated in its
entirety to provide as follows:
(b) RATIO OF CONSOLIDATED TOTAL DEBT TO CONSOLIDATED EBITDAR.
The Lessee shall not permit the ratio of (i) the amount of Consolidated
Total Debt as of the end of any Testing Period ending on and after
December 31, 2003 to (ii) Consolidated EBITDAR for such Testing Period,
to exceed 5.00 to 1.
E. Paragraph (c) of Section XXIII (Consolidated Fixed Charge Coverage
Ratio) of the Lease Agreement is amended and restated in its entirety to provide
as follows:
(c) MINIMUM EBITDAR. The Lessee shall not at any time permit
the Consolidated EBITDAR for the Testing Period ending on any of the
following dates to be less than the amount set forth opposite such
date:
Testing Period Ending Minimum EBITDAR
--------------------- ---------------
March 31, 2003 $ 8,500,000
June 30, 2003 $10,500,000
September 30, 2003 $14,000,000
December 31, 2003 $22,000,000
March 31, 2004 $24,000,000.
F. Paragraph (d) of Section XXIII (Consolidated Tangible Net Worth) of
the Lease Agreement is amended and restated in its entirety to provide as
follows:
(d) CONSOLIDATED TANGIBLE NET WORTH. The Lessee shall not permit the
Consolidated Tangible Net Worth to be less than (i) $185,000,000 as of
December 31, 2002
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or (ii) $180,000,000 at any time thereafter.
G. Paragraph (b) of Section XXIV(m) of the Lease Agreement
(Acquisitions) is amended and restated in its entirety to provide as follows:
(b) ACQUISITIONS. [Intentional Deleted].
H. Clause (A) of Paragraph (c) of Section XXIV(m) of the Lease
Agreement (Permitted Dispositions) is amended and restated in its entirety to
provide as follows:
(A) the consideration for such transaction represents fair
value (as determined by management of the Parent and approved by the
Lessor in writing, which approval shall not be withheld or delayed
unreasonably), and at least 90% of such consideration consists of cash
(with any instrument evidencing any deferred portion of consideration
being deposited in pledge with the Collateral Agent pursuant to, as the
case may be, the Security Agreement or the Subsidiary Security
Agreement),
I. Paragraph (e) of Section XXIV(m) of the Lease Agreement (Capital
Expenditures) is amended and restated in its entirety to provide as follows:
(e) CAPITAL EXPENDITURES. The Parent, the Lessee and the
Subsidiaries shall not make any Consolidated Capital Expenditure if,
after giving effect to such Consolidated Capital Expenditure, the
aggregate of all Consolidated Capital Expenditures made (i) during the
fiscal year of the Parent ending December 31, 2003 would exceed
$10,000,000 or (ii) during the fiscal quarter ending March 31, 2004
would exceed $3,000,000.
J. Paragraph (j) of Section XXIV(o) of the Lease Agreement (Additional
Unsecured Debt of the Parent and Lessee) is amended by deleting therefrom the
sum "$5,000,000" and inserting therein the sum "$3,000,000" in its stead.
K. Paragraph (e) of Section XXIV(p) of the Lease Agreement (Advances,
Investments, Loans and Guaranty Obligations) is amended and restated in its
entirety to provide as follows:
(e) the loans, advances, investments and guarantees in respect
of Indebtedness of persons other than Wholly-Owned Subsidiaries of the
Parent or the Lessee on the date of the Fifth Amendment to the Credit
Agreement and described in Annex V to the Credit Agreement and any
refinancing, extension, renewal or refunding thereof;
L. Paragraph (k) of Section XXIV(p) of the Lease Agreement (Advances,
Investments,
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Loans and Guaranty Obligations) is amended by deleting therefrom the sum
"$10,000,000" and inserting therein the sum "$1,000,000" in its stead.
M. The following provision is added as a new Section XXIV(y) of the
Lease Agreement immediately following Section XXIV(x) and before Section XXV:
(y) CONSULTANT ACCESS. The Lessee hereby agrees to instruct
and authorize, and to cause the Parent and each Subsidiary to instruct
and authorize, FTI Consultants, Inc. (the "Consultant") to provide to
the Lessor, promptly upon the request of the Lessor, true and complete
copies of such reports, analyses and other information relating to any
one or more of the Lessee, the Parent and the Subsidiaries, or
otherwise arising from or in connection with such Consultant's
engagement, as the Lessor may from time to time reasonably request and
to discuss with the Lessor, promptly upon the written request of the
Lessor to the Consultant (with a copy of any such notice to the
Parent), all aspects of the business and property of any one or more of
the Lessee, the Parent and the Subsidiaries and all of the Consultant's
findings, opinions and conclusions, whether tentative or final;
PROVIDED that the Lessee, the Parent or the Subsidiaries (as the case
may be) potentially affected by any such discussions, shall be entitled
to have one or more representatives present to observe such
discussions.
N. The definition of "Permitted Master Copper Lease Agreements" in
Section XXV of the Lease Agreement (Certain Definitions) is amended by deleting
therefrom the words and sum "an amount greater than $15,000,000" and inserting
therein the sum "$10,000,000" in their stead.
O. The definition of "Permitted Precious Metal Consignments" in Section
XXV of the Lease Agreement (Certain Definitions) is amended by deleting
therefrom the sum "$70,000,000" and inserting therein the sum "$50,000,000" in
its stead.
2. Delivery Date; Conditions Precedent. The modifications to the Lease
Agreement set forth in Section 1, above, are subject to the Lessee's performance
of the following (the date on which all have been performed being the "Delivery
Date"):
A. The Lessee's secretary or treasurer shall have certified to the
Lessor (i) a copy of the resolutions duly adopted by the Lessee's board of
directors in respect of this Amendment and the other Lease Documents
contemplated hereby; (ii) true and correct copies of the Lessee's current
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Charter or Articles of Incorporation and By-laws or Code of Regulations (or, if
applicable, that no modifications thereof have been made since they were most
recently certified to the Lessor); (iii) the names and true signatures of the
officers of the Lessee authorized to sign this Tenth Amendment on behalf of the
Lessee; (iv) that, after giving effect to the amendments set forth herein, no
Default or Potential Default exists; and (v) that the representations and
warranties of the Lessee under the Lease Agreement are reaffirmed as of the
Delivery Date, subject only to variance therefrom acceptable to the Lessor.
B. Each Guarantor's secretary or treasurer shall have certified to the
Lessor (i) a copy of the resolutions duly adopted by that Guarantor's board of
directors in respect of this Amendment and the other Lease Documents
contemplated hereby; (ii) true and correct copies of that Guarantor's current
Charter or Articles of Incorporation and By-laws or Code of Regulations (or, if
applicable, that no modifications thereof have been made since they were most
recently certified to the Lessor); (iii) the names and true signatures of the
officers of that Guarantor authorized to sign any Mortgage amendment and other
Lease Documents required hereby on behalf of that Guarantor; and (iv) that,
after giving effect to the amendments set forth herein, no Default exists.
C. Counsel to the Lessee and the Guarantors shall have delivered to the
Lessor a written opinion as to the due authorization, execution, delivery and
enforceability of this Tenth Amendment and the other documents described in
paragraphs E, through H, inclusive, of this Section 2, in form and substance
satisfactory to the Lessor; provided that no opinion with respect to the
enforceability of any document described in paragraph E below shall be required.
D. The Lessee shall have paid to the Lessor in immediately available
funds, for the ratable benefit of the Lessor and its participants, an amendment
fee in the amount of One Hundred Ninety-three Thousand Two Hundred Eighty-five
Dollars ($193,285).
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E. Each Guarantor that has granted to the Collateral Agent a Mortgage
shall have executed and delivered to the Collateral Agent an amendment to such
Mortgage in the form of Attachment 1 hereto and shall, at the Lessee's expense,
accompany such amendment with an endorsement to the ALTA loan policy of title
insurance in respect of such Mortgage in form and substance reasonably
satisfactory to the Collateral Agent.
F. Each of the Guarantors shall have executed a confirmation of its
Guaranty and of, as the case may be, the Security Agreement or Subsidiary Lease
Security Agreement in the form of Attachment 2 hereto.
G. Brush International, Inc. shall have executed and delivered to the
Lessor a confirmation of the Foreign Subsidiary Pledge Agreement in the form of
Attachment 3 hereto.
H. All of the parties to the Collateral Agency Agreement shall have
executed and delivered to Lessor a Third Amendment to Intercreditor and
Collateral Agency Agreement in the form of Attachment 4 hereto.
I. All of the parties to the Credit Agreement shall have executed and
delivered an amendment thereto in form and substance satisfactory to the Lessor,
and all conditions to its effectiveness shall have been satisfied.
J. The Lessee shall have delivered or caused to be delivered such other
documents as Collateral Agent or the Lessor may reasonably request.
3. No Other Modifications. Except as expressly provided in this Tenth
Amendment, all of the terms and conditions of the Lease Agreement remain
unchanged and in full force and effect.
4. Governing Law; Binding Effect. This Tenth Amendment shall be
governed by and construed in accordance with the laws of the State of Ohio and
shall be binding upon and inure to
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the benefit of the Lessee, the Lessor, and their respective successors and
assigns.
5. Counterparts. This Tenth Amendment may be executed in separate
counterparts, each of which shall be deemed to be an original, and all of which
together shall be deemed a fully executed agreement.
6. Miscellaneous.
A. The Lessee agrees to pay on demand all costs and expenses of the
Lessor, including reasonable attorneys' fees and expenses, incurred in
connection with the preparation, execution and delivery of this Tenth Amendment
and the other documents contemplated hereby, including, without limitation, the
Third Amendment to Intercreditor and Collateral Agency Agreement.
B. This Tenth Amendment is executed in accordance with and subject to
Section XIX(g) of the Lease Agreement. The execution, delivery and performance
by the Lessor of this Tenth Amendment shall not constitute, or be deemed to be
or construed as, a waiver of any right, power or remedy of the Lessor or a
waiver of any provision of the Lease Agreement, except as expressly stated
herein. None of the provisions of this Tenth Amendment shall constitute, or be
deemed to be or construed as, a wavier of any Default or Potential Default.
[No additional provisions are on this page; the next page is
the signature page.]
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IN WITNESS WHEREOF, the Lessee, the Lessor and its participants have
hereunto set their hands as of the date first above written.
LESSEE: LESSOR:
------ ------
BRUSH XXXXXXX INC. NATIONAL CITY BANK,
FOR ITSELF AND AS AGENT FOR
CERTAIN PARTICIPANTS
By: _______________________________ By: _______________________________
----------------, -------------- ----------------, --------------
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THE FOREGOING AMENDMENT is hereby acknowledged, consented and agreed to by each
of the undersigned by their respective duly authorized officers as of the day
and year first above written.
Address: FIFTH THIRD BANK, an Ohio banking
corporation, f/k/a Fifth Third Bank,
Northeastern Ohio
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Fax: (000) 000-0000 By: _______________________________
Title: ______________________________
Address: XXXXXX TRUST AND SAVINGS BANK
X.X. Xxx 000 (000/00X)
Xxxxxxx, XX 00000-0000
Fax: (000) 000-0000 By:_________________________________
Title: ______________________________
Address: U.S. BANK NATIONAL ASSOCIATION,
f/k/a Firstar Bank, N.A.
X.X. Xxx 000
Xxxxxxxx XX-XX-00XX
Xx. Xxxxx, XX 00000-0000
Fax: (000) 000-0000 By: ________________________________
Title: ______________________________
Address: LASALLE NATIONAL LEASING CORPORATION
Xxx Xxxx Xxxxxxxxxxxx Xxxxxx
Xxxxx 0000 Xx: ________________________________
Xxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000 Title: _______________________________
Address: MANUFACTURERS AND TRADERS
TRUST COMPANY
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000 By: ________________________________
Fax: (000) 000-0000
Title: ______________________________
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