THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made as of the
30th day of September, 1998, among KEMET CORPORATION, a Delaware corporation
(the "Borrower"), WACHOVIA BANK, N.A. as Agent (successor by merger to
Wachovia Bank of Georgia, N.A. and hereinafter referred to as the "Agent")
under the Credit Agreement (as herein defined) and the BANKS named in the
Credit Agreement (as herein defined) and the BANKS named in the Credit
Agreement.
Background:
The Borrower, the Agent and the Banks have entered into a certain Credit
Agreement dated as of October 18, 1996, as amended by a First Amendment to
Credit Agreement dated as of August 30, 1997, as further amended by a Second
Amendment to Credit Agreement dated as of March 31, 1998 (as amended,
the"Credit Agreement").
The Borrower, the Agent and the Banks wish to amend the Credit Agreement in
certain respects, as hereinafter provided.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Definitions. Capitalized terms used herein which are not
otherwise defined herein shall have the respective meanings assigned to them
in the Credit Agreement.
SECTION 2. Amendment. The Credit Agreement is hereby amended as follows:
Section 2.1. Additional Definition. An additional definition is hereby added
to Section 1.01 of the Credit Agreement to be inserted in proper alphabetical
order and to read as follows:
"Year 2000 Compliant and Ready" as used herein means that (A) the Borrower's
and its Subsidiaries' hardware and software systems with respect to the
operation of its business and its general business plan will, except as is not
expected to have a Material Adverse Effect: (i) handle date information
involving any and all dates before, during and/or after January 1, 2000,
including accepting input, providing output and performing date calculations
in whole or in part; (ii) operate accurately without interruption on and in
respect of any and all dates before, during and/or after January 1, 2000 and
without any change in performance; (iii) store and provide date input
information without creating any ambiguity as to the century; and (B) the
Borrower has developed alternative plans to ensure business continuity in the
event of the failure of any or all of items (i) through (iii) above.
Section 2.2 Addition of Representation. A new section is hereby added as
Section 4.19 of the Credit Agreement to read as follows:
Section 4.19. Year 2000. the Borrower and its Subsidiaries are in the process
of taking steps to address the impact of the occurrence of the year 2000 on
their internal computer systems and the occurrence of the year 2000 and its
impact on said internal computer systems is not expected to have a Material
Adverse Effect.
Section 2.3 Amendment to Section 5.01
2
Section 5.01 of the Credit Agreement is hereby amended by deleting the "and"
at the end of Section 5.01 (i), replacing the "." at the end of Section 5.01
(j) with a ";" , and by adding two additional subsections thereto which shall
read as follows:
(k) simultaneously with the delivery of each set of annual and quarterly
financial statements referred to above, a statement of the chief financial
officer, chief accounting officer or chief technology officer to the effect
that nothing has come to their attention to cause them to believe that the
Borrower's and its Subsidiaries' hardware and software systems will not be
Year 2000 Compliant and Ready; and
(l)within 5 domestic business Days after the Borrower becomes aware of
circumstances which would cause the Borrower to believe that it and its
Subsidiaries will not be Year 2000 Compliant and Ready, a statement of the
chief financial officer, chief accounting officer or chief technology officer
setting forth the details thereof and the action which the Borrower is taking
or proposed to take with respect thereto.
Section 2.4 Amendment to Section 5.05. Section 5.05 of the Credit Agreement
is hereby amended and restated in its entirety to read as follows:
Section 5.05. Ratio of Earnings Before Interest, Leases and Taxes to
Consolidated Fixed Charges. At the end of each Fiscal Quarter, the ratio of
Earnings Before Interest, Leases and Taxes for the Fiscal Quarter then ending
and the three Fiscal Quarters immediately preceding the Fiscal Quarter then
ending to consolidated Fixed Charges for the Fiscal Quarter then ending and
the three Fiscal Quarters immediately preceding the Fiscal Quarter then ending
shall be greater than (a) 3.00 to 1.00 from and including the Fiscal Quarter
ending December 31, 1996 to but excluding the fiscal Quarter ending September
30, 1998, (b) 2.50 to 1.0 from and including the fiscal Quarter ending
September 30, 1998 to but excluding the Fiscal Quarter ending December 31,
1998, (c) 2.20 to 1.00 from and including the Fiscal Quarter ending December
31, 1998 to but excluding the fiscal Quarter ending Xxxxx 00, 0000, (x) 2.00
to 1.00 from and including the Fiscal Quarter ending March 31, 1999 to but
excluding the fiscal Quarter ending June 30, 1999, (e) 2.50 to 1.00 from and
including the Fiscal Quarter ending June 30, 1999 to but excluding the Fiscal
Quarter ending September 30, 1999, and (f) 3.00 to 1.00 for all Fiscal
Quarters ending on or after September 30, 1999.
SECTION 3. No Other Amendment. Except for the amendment set forth above, the
text of the Credit Agreement shall remain unchanged and in full force and
effect. This Amendment is not intended to effect, nor shall it be construed
as, a novation. The Credit Agreement and this Amendment shall be construed
together as a single instrument and any reference to the "Agreement" or any
other defined term for the Credit Agreement in the Credit Agreement, the Notes
or any certificate, instrument or other document delivered pursuant thereto
shall mean the Credit Agreement as amended hereby and as it may be amended,
supplemented or otherwise modified hereafter.
SECTION 4. Representation and Warranties. The Borrower hereby represents and
warrants in favor of the Agent and the Banks as follows:
(a) No Default or Event of Default under the Credit Agreement has occurred
and is continuing on the date hereof;
(b) The Borrower has the corporate power and authority to enter into this
Amendment and to do all acts and things as required or contemplated hereunder
to be done, observed and performed by it;
(c) This Amendment has been duly authorized, validly executed and delivered
by
3
one or more authorized officers of the Borrower and each of this Amendment and
the Credit Agreement, as amended hereby constitutes the legal, valid and
binding obligation of the Borrower enforceable against it in accordance with
its terms; provided, that the enforceability of each of this Amendment and the
Credit
Agreement as amended hereby is subject to general principles of equity and to
bankruptcy, insolvency and similar laws affecting the enforcement of
creditors'
rights generally; and
(d) The execution and delivery of this Amendment and the Borrower's
performance hereunder and under the Credit Agreement as amended hereby do not
and will not require the consent or approval of any regulatory authority or
governmental authority or agency having jurisdiction over the Borrower other
than those which have already been obtained or given, nor be in contravention
of or in conflict with the Articles of Incorporation or Bylaws of the
Borrower, or the provision of any statute, or any judgment, order or
indenture, instrument, agreement or undertaking, to which to Borrower is a
party or by which its assets or properties are or may become bound.
SECTION 5. Counterparts. This Amendment may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of
which, taken together, shall constitute one and the same agreement.
SECTION 6. Governing Law. This Amendment shall be deemed to be made pursuant
to the laws of the State of Georgia with respect to agreements made and to be
performed wholly in the State of Georgia and shall be construed, interpreted,
performed and enforced in accordance therewith.
SECTION 7. Effective Date. This Amendment shall become effective as of the
date first set forth above, upon receipt by the Agent from each of the parties
hereto of either a duly executed signature page from a counterpart of the
Amendment or a facsimile transmission of a duly executed signature page from a
counterpart of this Amendment, signed by such party.
SECTION 8. Amendment Fee. On the date first set forth above, the Borrower
shall pay to the Agent for the ratable account of each Bank and amendment fee
equal to the product of such Bank's Commitment (irrespective of usage) as of
such date multiplied by .05%.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to by duly
executed under seal by their respective authorized officers as of the day and
year first above written.
BORROWER:
KEMET CORPORATION
By: /S/ D.R. Cash [SEAL]
Title: Senior Vice President -
Administration & Treasurer
[Remainder of this page intentionally left blank]
4
WACHOVIA BANK, N.A. (successor by merger
to Wachovia Bank of Georgia, N.A. and Wachovia
Bank of South Carolina, N.A. and formerly known
as Wachovia Bank of North Carolina, N.A.),
as Agent and as a Bank
By: /S/ Xxxxxxx Xxxxxxxx [SEAL]
Title: Assistant Vice President
[Remainder of this page intentionally left blank]
5
ABN AMRO BANK N.V. ATLANTA AGENCY, as
Co-Agent and Bank
By: /S/ Xxxxx X. Xxxxx [SEAL]
Title: Vice President
By: /S/ Xxxxxx X. Xxxxxxx
Title: Vice President
[Remainder of this page intentionally left blank]
6
SUNTRUST BANK, ATLANTA
By: /S/ X.X. Xxxx [Seal]
Title: Banking Officer
By: /S/ Xxxxx X. Xxxxxx [Seal]
Title: Vice President
[Remainder of this page intentionally left blank]
7
FIRST UNION NATIONAL BANK (formally known
as
First Union National Bank of South
Carolina)
By: /S/ Xxxxx X. Xxxxx III [SEAL]
Title: Senior Vice President
[Remainder of this page intentionally left blank]
8
PNC BANK, NATIONAL ASSOCIATION
By: /S/ Xxxx X. Xxxxx [SEAL]
Title: Vice President
[Remainder of this page intentionally left blank]
9
BANK OF AMERICAN NT & SA
By: /S/ Xxxxxxx X. Xxxxxx, Xx. [SEAL]
Title: Vice President
[Remainder of this page intentionally left blank]
[Remainder of this page intentionally left blank]
