PORTOLA PACKAGING CANADA LTD.
AS BORROWER
- AND -
PORTOLA PACKAGING, INC.
AS GUARANTOR
- AND -
THE LENDERS NAMED ON THE SIGNATURE PAGES HEREOF
AS LENDERS
- AND -
CANADIAN IMPERIAL BANK OF COMMERCE
AS AGENT
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FIRST AMENDING AGREEMENT
TO
CREDIT AGREEMENT DATED AS OF JUNE 16, 1995
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DATED AS OF NOVEMBER 26, 1997
FIRST AMENDING AGREEMENT
First Amending Agreement dated as of November 26, 1997 among Portola
Packaging Canada Ltd., a corporation incorporated and existing under the laws
of Canada, as Borrower, Portola Packaging, Inc., as Guarantor and Canadian
Imperial Bank of Commerce, as Lender and Canadian Imperial Bank of Commerce,
as Agent (and such other Persons as may from time to time become Lenders
under the Credit Agreement, as hereinafter defined).
WHEREAS pursuant to a credit agreement dated as of June 16, 1995 among
3154823 Canada Inc., the Lenders (as defined therein) and the Agent (the
"Original Credit Agreement"), the Lenders agreed to extend to the Borrower
certain credit facilities in the aggregate amount of up to Cdn. $14,000,000;
AND WHEREAS Portola Packaging Ltd. is the successor by amalgamation of
3154823 Canada Inc. and Portola Packaging Ltd. is now the borrower under the
Credit Agreement;
AND WHEREAS the Borrower, the Guarantor, the Lenders and the Agent desire
to amend certain covenants contained in the Credit Agreement;
NOW THEREFORE, in consideration of the foregoing premises, the sum of
$10.00 in lawful money of Canada and for other good and valuable
consideration, the receipt and sufficiency whereof is hereby acknowledged,
the parties hereto agree as follows:
ARTICLE 1
INTERPRETATION
SECTION 1.1. DEFINITIONS. In this First Amending Agreement and the
recitals hereto, unless there is something in the subject matter or context
inconsistent therewith or unless otherwise expressly provided, all
capitalized terms used herein shall have the meaning ascribed thereto under
the Credit Agreement; and "HEREIN", "HEREBY", "HEREOF", and similar
expressions mean or refer to this First Amending Agreement; and the
expressions "ARTICLE" and "SECTION" followed by numbers or letters mean and
refer to the specified Article or Section of this First Amending Agreement
unless otherwise specified.
SECTION 1.2. INCORPORATION OF CREDIT AGREEMENT. This First Amending
Agreement is supplemental to and shall henceforth be read in conjunction with
the Credit Agreement and the Credit Agreement, as amended by this First
Amending Agreement shall henceforth have effect so far as practicable as if
all the provisions thereof and hereof were contained in one instrument. In
this First Amending Agreement and the recitals hereto, unless there is
something in the subject matter or context inconsistent therewith, or unless
so stated to the contrary in this First Amending Agreement, the words and
expressions herein contained which are defined in the Credit Agreement shall
have the meanings given to such words and expressions in the Credit Agreement.
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SECTION 1.3. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT. On and
after the date hereof, each reference in the Credit Agreement to "this
Agreement", "hereunder", "hereof, "herein", or words of like import, and each
reference to the Credit Agreement in the other Credit Documents and any other
agreements, documents and instruments delivered by all or any one or more of
the Borrower, the Lenders and the Agent and any other Person shall mean and
refer to the Credit Agreement as amended by this First Amending Agreement.
Except as specifically amended by this First Amending Agreement, the Credit
Agreement shall remain in full force and effect and is hereby ratified and
confirmed. All amendments to the Credit Agreement contained in this First
Amending Agreement shall be effective as of the date of this First Amending
Agreement.
SECTION 1.4. INTERPRETATION NOT AFFECTED BY HEADINGS, ETC. The division
of this First Amending Agreement into Articles and Sections and the insertion
of headings are for convenience of reference only and shall not affect the
construction or interpretation thereof.
ARTICLE 2
AMENDMENTS TO THE CREDIT AGREEMENT
SECTION 2.1. DELETION OF SECTIONS 8.03(A) AND SECTIONS 8.03(B). Sections
8.03(a) and 8.03(b) are hereby deleted.
SECTION 2.2. AMENDMENTS TO SECTION 8.03(C). Section 8.03(c) is hereby
deleted and replaced by the following:
"Maintain (i) for the three month period ended November 30, 1997; (ii)
for the six month period ended February 28, 1998; (iii) for the nine
month period ended May 30, 1998, (iv) for the twelve month period
ended August 31, 1998; and (v) for each twelve month period ended on
the last day of any Financial Quarter ending after August 31, 1998, a
ratio of Consolidated EBDIT to Consolidated Interest Charges of not
less than 4.0:1."
SECTION 2.3. AMENDMENTS TO SECTION 8.03(D). Section 8.03(d) is hereby
deleted and replaced by the following:
(d) MAINTENANCE OF FIXED CHARGE COVERAGE. Maintain (i) for the three
month period ended November 30, 1997; (ii) for the six month period
ended February 28, 1998; (iii) for the nine month period ended May 30,
1998; (iv) for the twelve month period ending August 31, 1998; and (v)
for each twelve month period ended on the last day of a Financial
Quarter ended after August 31, 1998, a ratio of
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Consolidated EBDIT to Consolidated Fixed Charges of not less than
1.10:1.
SECTION 2.4. AMENDMENTS TO SECTION 8.03(E). Section 8.03(e) is hereby
deleted and replaced by the following:
(e) MAINTENANCE OF CURRENT RATIO. Maintain, as of the last day of
each Financial Quarter, a ratio of Consolidated Current Assets to
Consolidated Current Liabilities (excluding the current portion of
long term debt) of not less than 1.25:1.
SECTION 2.5. AMENDMENT TO SCHEDULE 4. Schedule 4 is hereby amended by
adding thereto under the heading "Security from Portola" the following as item
(c),
"the support agreement entered into by Portola in favour of the Agent
and the Lenders dated as of November 26, 1997"
and by deleting the word "and" at the end of item (a) and by replacing the
period at the end of item (b) with a semicolon followed by the word "and".
SECTION 2.6. WAIVERS. The Agent and the Lenders hereby waive any Default
or Event of Default arising under Section 8.03 in respect of any period ended
prior to September 1, 1997.
SECTION 2.7. AMENDMENT FEE. The Borrower shall pay to the Agent an
amendment fee of $40,000 contemporaneously with the execution thereto.
ARTICLE 3
GENERAL
SECTION 3.1. CONFIRMATION BY BORROWER. The Borrower hereby confirms and
acknowledges that all Security granted by it to and in favour of the Agent or
the Lenders or both or to the Agent for and on behalf of the Lenders
continues to secure, among other things, all Obligations of the Borrower
under or with respect to the Credit Agreement, as amended by this First
Amending Agreement.
SECTION 3.2. CONFIRMATION BY GUARANTOR. The Guarantor hereby consents
to the within amendments and confirms and agrees that the guarantee and the
security entered into by it to and in favour of the Agent or the Lenders or
both or to the Agent for and on behalf of the Lenders remains in full force
and effect.
SECTION 3.3. COSTS AND EXPENSES. The Borrower shall pay all reasonable
costs and expenses of the Agent and the Lenders associated with the
preparation, execution and delivery of this First Amending Agreement and all
documentation contemplated hereby and delivered in connection herewith,
including the reasonable legal fees of counsel.
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SECTION 3.4. GOVERNING LAW. This First Amending Agreement shall be
governed by and construed in accordance with the laws of the Province of British
Columbia and the laws of Canada applicable therein.
SECTION 3.5. COUNTERPARTS. This First Amending Agreement may be executed
in any number of counterparts and all such counterparts taken together shall be
deemed to constitute one and the same instrument.
IN WITNESS WHEREOF the parties hereto have caused this First Amending
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
PORTOLA PACKAGING CANADA LTD.
Per: /s/ Xxxxxx Xxxxxxx
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Authorized Signing Officer
THE LENDER
CANADIAN IMPERIAL BANK OF COMMERCE
Per: /s/ Xxxxx Xxxxxxx
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Authorized Signing Officer
THE AGENT
CANADIAN IMPERIAL BANK OF COMMERCE
Per: /s/ Xxxxx Xxxxxxx
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Authorized Signing Officer
(signatures continue on the next page)
(signatures continue from the previous page)
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THE GUARANTOR
PORTOLA PACKAGING, INC.
Per: /s/ Xxxxxx X. Xxxxxxxxx
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Authorized Signing Officer
