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EXHIBIT (b)(2)
FIRST AMENDMENT AND MODIFICATION AGREEMENT
FIRST AMENDMENT AND MODIFICATION AGREEMENT dated as of March
19, 1998 (this "Amendment") by and among HADCO CORPORATION, a Massachusetts
corporation (the "Borrower"); the direct and indirect subsidiaries of the
Borrower listed on the signature pages hereto (collectively, the "Hadco
Subsidiaries"); BANKBOSTON, N.A., AS AGENT (the "Agent"); and BANKBOSTON, N.A.,
individually and the other lending institutions (collectively, the "Banks")
party to the Amended and Restated Revolving Credit Agreement dated as of
December 8, 1997 (as amended and in effect from time to time, the "Agreement")
among the Borrower, the Banks and the Agent. Terms not otherwise defined herein
which are defined in the Agreement shall have the respective meanings assigned
to such terms in the Agreement.
WHEREAS, the Borrower and its newly formed, wholly owned
Subsidiary Hadco Acquisition Corp. II ("Hadco Acquisition II") have offered,
pursuant to an Offer To Purchase dated February 20, 1998 (the "Tender Offer") to
purchase one hundred percent (100%) of the outstanding capital stock of
Continental Circuits, Corp., a Delaware corporation ("Continental Circuits");
WHEREAS, following the completion of the Tender Offer, the
Borrower intends to cause the merger of Hadco Acquisition II and Continental
Circuits (the "Continental Merger"), with Continental Circuits (to be renamed
Hadco Phoenix, Inc. ("Hadco Phoenix")) as the surviving entity;
WHEREAS, ss.9.5.2(b) of the Agreement sets forth certain
requirements for the acquisition contemplated by the Tender Offer and the
Continental Merger;
WHEREAS, in connection with the Tender Offer and the
Continental Merger, the Borrower has requested that the Agent and the Banks
amend certain provisions of the Agreement; and
WHEREAS, upon the terms and subject to the conditions contained
herein, the Agent and the Banks are willing to amend such provisions of the
Credit Agreement;
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NOW, THEREFORE, in consideration of the mutual agreements
contained in the Agreement, the other Loan Documents and this Amendment and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
ss.1. AMENDMENT OF ss.1.1 OF THE AGREEMENT. Section 1.1 of the
Agreement is hereby amended by:
(a) deleting the definition of "Applicable Commitment
Fee Percentage" in its entirety and substituting in lieu
thereof the following new definition:
"APPLICABLE COMMITMENT FEE PERCENTAGE. For any fiscal
quarter or portion thereof, three-eighths of one percent
(0.375%) per annum; PROVIDED, HOWEVER, that in the event that
the ratio of Funded Debt (calculated as of the last day of such
fiscal quarter or portion thereof) to EBITDA (calculated for
the four consecutive fiscal quarters ending on the last day of
such fiscal quarter or portion thereof) meets the requirements
set forth in the chart below, the Applicable Commitment Fee
Percentage shall, commencing with the date (the "Commitment Fee
Adjustment Commencement Date") which is ten (10) days after the
date on which the Borrower delivers to the Banks the financial
statements referred to in ss.8.4(a) or (b) for such fiscal
quarter or portion thereof, and ending with the date (the
"Commitment Fee Adjustment Termination Date") which is nine (9)
days after the next date on which the Borrower delivers to each
of the Banks the financial statements referred to in ss.8.4(a)
or (b), be the percentage set forth opposite the applicable
ratio of Consolidated Funded Debt to EBITDA in the table below;
PROVIDED, HOWEVER, that in connection with any Permitted
Acquisition pursuant to ss.9.5.2(b), the next Commitment Fee
Adjustment Termination Date shall be deemed to be one day prior
to the Permitted Acquisition Funding Date for such Permitted
Acquisition, and the next Commitment Fee Adjustment
Commencement Date (with the Applicable Commitment Fee
Percentage to be based upon the ratio contained in the
Permitted Acquisition Ratio Compliance Certficate for such
Permitted Acquisition) shall be deemed to be the Permitted
Acquisition Funding Date for such Permitted Acquisition:
Ratio of Consolidated Funded Applicable Commitment
Debt to EBITDA Fee Percentage
-------------- --------------
Greater than or equal to 2.5:1.0 0.375%
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Greater than or equal to 2.0:1.0 0.275%
but less than 2.5:1.0
Greater than or equal to 1.5:1.0 0.225%
but less than 2.0:1.0
Less than 1.5:1.0 0.200%
If any financial statements referred to above are not delivered within the time
periods specified in ss.8.4(a) or, as the case may be, ss.8.4(b), then, until
such financial statements are delivered, the Applicable Commitment Fee
Percentage as at the end of the fiscal period that would have been covered
thereby shall, for the purposes of this definition, be deemed to be 0.375%. In
addition, at all times while a Default or Event of Default shall have occurred
and be continuing, the Applicable Commitment Fee Percentage shall, for the
purposes of this definition, be deemed to be 0.375%."
(b) deleting the definition of "Applicable Eurodollar
Rate Margin" in its entirety and substituting in lieu thereof
the following new definition:
"APPLICABLE EURODOLLAR RATE MARGIN. For any fiscal
quarter or portion thereof within any Interest Period with
respect to any Eurodollar Rate Loan, one and three-eighths
percent (1.375%) per annum; PROVIDED, HOWEVER, that in the
event that the ratio of Consolidated Funded Debt (calculated as
of the last day of such fiscal quarter or portion thereof) to
EBITDA (calculated for the four fiscal quarters ending on the
last day of such fiscal quarter or portion thereof) meets the
requirements set forth in the chart below, the Applicable
Eurodollar Rate Margin shall, commencing with (but not before)
the date (the "Eurodollar Rate Margin Adjustment Commencement
Date") which is ten (10) days after the date on which the
Borrower delivers to the Banks the financial statements
referred to in ss.8.4(a) or (b) for such fiscal quarter or
portion thereof and ending with the date (the "Eurodollar Rate
Margin Adjustment Termination Date") which is nine (9) days
after the next date on which the Borrower delivers to each of
the Banks the financial statements referred to in ss.8.4(a) or
(b), be the percentage set forth opposite the applicable ratio
of Consolidated Funded Debt to EBITDA in the table below;
PROVIDED, HOWEVER, that in connection with any Permitted
Acquisition pursuant to ss.9.5.2(b), the next Eurodollar Rate
Margin Adjustment Termination Date shall be deemed to be one
day prior to the Permitted Acqusition Funding Date for such
Permitted Acquisition, and the next Eurodollar Rate Margin
Adjustment Commencement Date (with the Applicable
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Eurodollar Rate Margin to be based upon the ratio contained in
the Permitted Acquisition Ratio Compliance Certficate for such
Permitted Acquisition) shall be the Permitted Acquisition
Funding Date for such Permitted Acquisition:
Ratio of Consolidated Funded Applicable Eurodollar
Debt to EBITDA Rate Margin
-------------- -----------
Greater than or equal to 3.0:1.0 1.375%
Greater than or equal to 2.5:1.0 1.125%
but less than 3.0:1.0
Greater than or equal to 2.0:1.0 0.875%
but less than 2.5:1.0
Greater than or equal to 1.5:1.0 0.625%
but less than 2.0:1.0
Less than 1.5:1.0 0.500%
If any financial statements referred to above are not delivered within the time
periods specified in ss.8.4(a) or, as the case may be, ss.8.4(b), then, until
such financial statements are delivered, the Applicable Eurodollar Rate Margin
as at the end of the fiscal period that would have been covered thereby shall,
for the purposes of this definition, be deemed to be 1.375%. In addition, at all
times while a Default or Event of Default shall have occurred and be continuing,
the Applicable Eurodollar Rate Margin shall, for the purposes of this
definition, be deemed to be 1.375%."
(c) inserting the following new definitions in the
order required by alphabetical order:
"CCIR INTERNATIONAL. CCIR International, Inc., a
Barbados corporation."
"CCIR OF CALIFORNIA. CCIR of California, Corp., a
California corporation."
"CCIR OF TEXAS. CCIR of Texas, Corp., a Texas
corporation."
"CONTINENTAL CIRCUITS. Continental Circuits Corp.,
a Delaware corporation, and the issuer of the
Securities.
"CONTINENTAL MERGER. As contemplated by the Continental
Merger Documents, the merger of Hadco Acquisition II with and
into Continental Circuits, with Continental Circuits (to be
renamed Hadco Phoenix, Inc.) as the surviving entity."
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"CONTINENTAL MERGER DOCUMENTS. The Agreement and Plan of
Merger, dated February 16, 1998, among the Borrower, Hadco
Acquisition II and Continental Circuits, together with all
schedules, exhibits and annexes thereto, and all agreements and
documents entered into or required to be entered into and
delivered pursuant to such Agreement and Plan of Merger or in
connection with the Continental Merger, including the
Stockholders Agreement dated February 16, 1998 among the
Borrower, Hadco Acquisition II and certain selling shareholders
of Continental Circuits."
"FIRST AMENDMENT EFFECTIVE DATE. The "Effective Date",
as defined in the First Amendment and Modification Agreement
dated as of March 19, 1998 among the Borrower, certain of its
Subsidiaries, the Agent and the Banks."
(d) deleting the definition of "Guarantor" in its
entirety and substituting in lieu thereof the following new
definition:
"GUARANTORS. (i) Hadco Santa Xxxxx, Hadco Acquisition II
and, following the consummation of the Continental Merger,
Hadco Phoenix, CCIR of Texas and CCIR of California; and (ii)
any other direct or indirect Subsidiary of the Borrower (other
than Hadco FSC, New Zycon, New Continental, Hadco Malaysia or
CCIR International)."
(e) inserting the following new definition in the
place required by alphabetical order:
"HADCO ACQUISITION II. Hadco Acquisition Corp. II, a
Delaware corporation, wholly owned Subsidiary of the Borrower,
and party to, but not the survivor of, the Continental Merger."
"HADCO PHOENIX. Hadco Phoenix, Inc., a Delaware
corporation, and the survivor of the Continental Merger."
(f) inserting into the definition of "Loan Documents",
immediately after the text "the Guaranties" and immediately
before the text "the Agent's Side Letter", the text "the Stock
Pledge Agreement".
(g) inserting the following new definitions in the
places required by alphabetical order:
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"MAXIMUM GUARANTEED LOAN VALUE. "Maximum loan value" as
used and defined in Section 221.8 of Regulation U of the Board
of Governors of the Federal Reserve System, 12 C.F.R.
ss.221.8."
"NEW CONTINENTAL. Continental Circuits Corp., a Delaware
corporation and wholly owned Subsidiary of the Borrower, to be
incorporated following the consummation of the Continental
Merger."
"PERMITTED ACQUISITION FUNDING DATE. With respect to any
Permitted Acquisition pursuant to ss.9.5.2(b), the Drawdown
Date for the initial or sole Loan, the proceeds of which are to
be used to fund all or any portion of such Permitted
Acquisition."
"PERMITTED ACQUISITION RATIO COMPLIANCE CERTIFICATE. For
any Permitted Acquisition pursuant to ss.9.5.2(b), the
compliance certificate delivered pursuant to
ss.9.5.2(b)(vi)(y), setting forth on a PRO FORMA basis, the
ratio of Consolidated Funded Debt to EBITDA described in
ss.9.5.2(b)(v), after giving effect to such Permitted
Acquisition and assuming full funding of such Permitted
Acquisition on the initial Drawdown Date of the sole or initial
Loan, the proceeds of which are to be used to fund all or any
portion of such Permitted Acquisition."
"SECURITIES. Shares of the outstanding common stock,
$.01 par value per share of Continental Circuits, to be
purchased by Hadco Acquisition II pursuant to the Tender
Offer."
"STOCK PLEDGE AGREEMENT. The Stock Pledge Agreement
dated on or about March 19, 1998, made by Hadco Acquisition II
in favor of the Agent and the Banks, pursuant to which Hadco
Acquisition II will, until the consummation of the Continental
Merger and the compliance by the Borrower and the other
Transaction Parties with the requirements of ss.8.15.1, pledge
to the Agent the Securities in order to secure its obligations
under its Guaranty."
"TENDER OFFER. The offer to purchase the Securities
pursuant to the Tender Offer Documents".
"TENDER OFFER DOCUMENTS. The Offer to Purchase dated
February 20, 1998 from Hadco Acquisition II to the holders of
the Securities, and all amendments and instruments required to
be entered into or delivered by the Borrower pursuant to such
Offer to Purchase in order to complete the purchase of the
Securities contemplated by the Tender Offer."
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ss.2. AMENDMENT OF SS.7.18 OF THE AGREEMENT. Section 7.18 of
the Agreement is hereby amended by deleting the first three sentences thereof in
their entirety and substituting in lieu thereof the following text:
"Hadco Santa Xxxxx, New Zycon, Hadco FSC, Hadco Acquisition II
(prior to the consummation of the Continental Merger) and Hadco Phoenix and New
Continental (following the consummation of the Continental Merger), are the
only direct Subsidiaries of the Borrower. The Borrower owns one hundred percent
(100%) of the capital stock of each of Hadco Santa Xxxxx, New Zycon and Hadco
FSC; prior to the consummation of the Continental Merger, the Borrower owns one
hundred percent (100%) of the capital stock of Hadco Acquisition II, and
following the consummation of the Continental Merger, the Borrower will own one
hundred percent (100%) of the capital stock of Hadco Phoenix and of New
Continental. Hadco Malaysia is the only Subsidiary of Hadco Santa Xxxxx, and
Hadco Santa Xxxxx owns one hundred percent (100%) of the capital stock of Hadco
Malaysia. Following the consummation of the Continental Merger, CCIR of
California, CCIR of Texas and CCIR International will be the only Subsidiaries
of Hadco Phoenix, and Hadco Phoenix will own one hundred percent (100%) of each
such Subsidiary. None of New Zycon, New Continental, Hadco FSC, or, following
the consummation of the Continental Merger, CCIR of California, CCIR of Texas
or CCIR International has any Subsidiaries."
ss.3. ADDITION OF NEW SS.8.15 TO THE AGREEMENT. The Agreement
is hereby amended by inserting, immediately after ss.8.14 of the Agreement, and
immediately before ss.9 of the Agreement, the following new ss.8.15:
"8.15. UNDERTAKINGS WITH RESPECT TO THE CONTINENTAL
MERGER.
8.15.1. CONFIRMATION OF GUARANTY; ADDITIONAL
GUARANTY. Immediately following the consummation of the
Continental Merger, the Borrower shall cause Hadco
Phoenix to execute and deliver to the Agent a
confirmation, in form and substance satisfactory to the
Agent, of the Guaranty to which Hadco Acquisition II is a
party, ratifying and confirming as its own the
obligations of Hadco Acquisition II under such Guaranty
following the consummation of the Continental Merger and
confirming that the amount of the obligations guaranteed
thereunder (a) equals the aggregate amount of the
Obligations, and (b) are no longer limited to the Maximum
Guaranteed Loan Value. Immediately following the
Continental Merger, the Borrower shall cause each of CCIR
of
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California and CCIR of Texas to execute and deliver to
the Agent a separate Guaranty, each in the form of
EXHIBIT E hereto, together with such evidence of
corporate authorization, legal opinions (including local
counsel opinions) and other documentation as the Agent
may request. The Agent and the Banks agree that, so long
as no other Default or Event of Default has occurred and
is continuing or would occur after giving effect thereto,
the Stock Pledge Agreement will terminate upon the
earliest to occur of (a)(i) the consummation of the
Continental Merger, and (ii) the Borrower's and the other
Transaction Parties' compliance with the other
requirements of this ss.8.15.1, and (b) the date upon
which the Securities no longer constitute Margin Stock."
8.15.2. CONSUMMATION OF CONTINENTAL MERGER. The
Borrower will take, and will cause the other Transaction
Parties to take, all corporate and legal actions
advisable or necessary to cause the Continental Merger to
be approved and effected in accordance with the
Continental Merger Documents and applicable law within
sixty (60) days after the First Amendment Effective Date.
8.15.3. DELIVERY OF SECURITIES. In the event that
the Stock Pledge Agreement is then still in effect, the
Borrower shall, within seven (7) days following the first
Drawdown Date on which the Borrower receives Loans, the
proceeds of which are used to fund the Borrower's and
Hadco Acquisition II's obligations in respect of the
Tender Offer, cause Hadco Acquisition II to deliver stock
certificates representing each of the Securities
purchased by Hadco Acquisition II in connection with the
Tender Offer, together with blank stock powers, duly
executed in blank, and to take such other actions as are
necessary or desirable in the opinion of the Agent to
protect and preserve its security interest in the
Securities. Immediately following any subsequent purchase
of Securities for so long as the Stock Pledge Agreement
remains in effect, the Borrower shall cause Hadco
Acquisition II to deliver to the Agent stock certificates
representing such additional Securities, together with
undated stock powers, duly executed in blank.
8.15.4. NOTIFICATION OF CLAIMS AGAINST SECURITIES.
For so long as the Stock Pledge Agreement is in effect,
the Borrower will, immediately upon becoming aware
thereof, notify the Agent and each of the Banks in
writing of any setoff, claims, withholdings or other
defenses to which any of the Securities, or the Agent's
rights with respect to the Securities, are subject.
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8.15.5. TERMINATION OF UCC FINANCING STATEMENTS.
Within thirty (30) days following the First Amendment
Effective Date, the Borrower shall, or shall cause the
Transaction Parties to, cause the termination of the
financing statements described in the table below:
Secured File Date of Jurisdiction
Debtor Party Number Filing of Filing
------ ------- ------ ------- ------------
PCA Design, Xxxxx Fargo Bank, 9527660413 9/29/95 SOS, CA
Incorporated National Association
PCA Design, Inc. Bank of America 9713560561 5/12/97 SOS, CA
Within thirty (30) days following any request therefor by the Agent, the
Borrower shall, or shall cause the Transaction Parties to, cause the termination
of any additional financing statements against any of the Transaction Parties or
related entities disclosed by any additional UCC searches initiated by the
Borrower or the Agent. The Borrower agrees that the requirements of this
ss.8.15.5 shall not be deemed to be waived by virtue of the fact that they are
not completed on the First Amendment Effective Date.
8.15.6. INDUSTRIAL DEVELOPMENT BONDS/BANK ONE, ARIZONA, NA. Within
twenty-seven (27) days following the First Amendment Effective Date, the
Borrower and/or one or more of the Transaction Parties shall (1) enter into a
reimbursement agreement with Bank One, Arizona, NA ("Bank One"), with respect
to reimbursement obligations of the Borrower or such Transaction Party under and
with respect to two letters of credit, issued by Bank One on behalf of
Continental Circuits and/or its Subsidiaries to secure obligations under the
Industrial Revenue Bonds described on SCHEDULE 9.1(a) and with a maximum
aggregate drawing amount of $7,086,301.61, with such reimbursement agreement to
be satisfactory in form and substance to the Agent and the Majority Banks in
their sole and absolute discretion, or (2)(a) give notice to the trustee(s) and
the bondholders under the Industrial Development Bonds described on SCHEDULE
9.1(a) hereto that such bonds shall be absolutely, fully and finally defeased or
paid within forty-five (45) days following the giving of such notice and (b)
within forty-five (45) days following the giving of such notice, cause the
absolute, full and final defeasance or payment of such bonds, together with the
termination of all reimbursement obligations of the Borrower or any of the
Transaction Parties under or with respect to the letters of credit described in
clause (a)
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above and the release of any and all collateral securing such reimbursement
obligations."
ss.4. AMENDMENT OF ss.9.1 OF THE AGREEMENT. Section 9.1 of the
Agreement is hereby amended by:
(a) deleting subparagraph (h) thereof in its entirety and
substituting in lieu thereof the following new subparagraph (h):
"(h) Indebtedness of the Borrower and the other Transaction
Parties (i) existing on the date hereof or on the First
Amendment Effective Date and (ii) listed and described on
SCHEDULE 9.1 hereto;".
(b) deleting clause (iv) of subparagraph (i) in its entirety
and substituting in lieu thereof the following new clause (iv): "(iv) New Zycon
or New Continental to the Borrower in an aggregate amount, for each such
company, not to exceed $50,000;".
ss.5. AMENDMENT OF ss.9.2 OF THE AGREEMENT. Section 9.2 of
the Agreement is hereby amended by deleting subparagraph (g)
thereof in its entirety and substituting in lieu thereof the
following new subparagraph (g):
"(g) liens (i) existing on the date hereof or on the First
Amendment Effective Date and (ii) listed on SCHEDULE 9.2 hereto;".
ss.6. AMENDMENT OF ss.9.3 OF THE AGREEMENT. Section 9.3 of the
Agreement is hereby amended by deleting clause (iii) of subparagraph (f) thereof
in its entirety and substituting in lieu thereof the following new clause (iii):
"(iii) New Zycon or New Continental in an aggregate amount for each such company
not to exceed $50,000;".
ss.7. AMENDMENT OF ss.9.5.2(b) OF THE AGREEMENT. Section
9.5.2(b) of the Agreement is hereby amended by inserting in clause (v) thereof,
immediately after the text "after giving effect to such Permitted Acquisition"
and immediately before the text", the ratio of Consolidated Funded Debt ...",
the text "and assuming full funding of such Permitted Acquisition on the initial
Drawdown Date of the sole or initial Loan, the proceeds of which are to be used
to fund all or any portion of such Permitted Acquisition".
ss.8. AMENDMENT OF ss.9.10 OF THE AGREEMENT. Section 9.10 of
the Agreement is hereby amended by:
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(a) deleting the title thereof in its entirety and
substituting in lieu thereof the following new title:
"AGREEMENTS REGARDING HADCO FSC, NEW ZYCON, NEW CONTINENTAL AND
CCIR INTERNATIONAL."
(b) inserting at the end thereof the following text:
"Neither the Borrower nor any of the other Transaction Parties
shall permit CCIR International (a) to engage in any activities
other than those directly related to its purpose as a foreign
sales corporation pursuant to secs.921-927 of the Code or (b)
at any time to own, hold or havE an interest in property or
assets, whether tangible or intangible and including cash and
cash equivalents, with a fair market value in excess of
$1,000,000. Neither the Borrower nor any of the other
Transaction Parties shall permit New Continental (x) to engage
in any activities other than holding the name "Continental
Circuits Corp." for the benefit of the Borrower and its
Subsidiaries or (y) at any time to own, hold or have an
interest in property or assets, whether tangible or intangible
and including cash and cash equivalents, with a fair market
value in excess of $50,000."
ss.9. AMENDMENT OF SS.10.4 OF THE AGREEMENT. Section 10.4 of
the Agreement is hereby amended by deleting the text "(ii) Capital Expenditures
made by the Borrower or any of its Subsidiaries during such period" and
substituting in lieu thereof the following text: "(ii) Capital Expenditures made
by the Borrower or any of its Subsidiaries during such period but excluding, for
each period of four consecutive fiscal quarters ending on or before the end of
the Borrower's third fiscal quarter, 1999, $30,000,000 of Capital Expenditures
made or to be made with respect to Continental Circuits' inner layer facility
located in Phoenix, Arizona and its quick turn facility located in Austin,
Texas,".
ss.10. SUPPLEMENTATION OF SCHEDULES TO THE AGREEMENT. SCHEDULES
7.7, 7.17, 9.1 and 9.2 are hereby respectively supplemented by adding, effective
upon the consummation of the Continental Merger, the attached SCHEDULES 7.7(a),
7.17(a), 9.1(a) and 9.2(a).
ss.11. LIMITED WAIVER. Subject to the satisfaction of each of
the conditions set forth in ss.12 of this Amendment, each of the Agent and the
Banks hereby waives the condition set forth in ss.9.5.2(b)(v) of the Agreement
that the financial statements which the Borrower delivers for Continental as at
the most recent quarter end be both audited and accompanied by an unqualified
audited opinion letter. The waiver herein granted shall not extend to or affect
any obligations not expressly herein
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waived and will not impair any right of the Agent or the Banks consequent
thereon. The waiver herein granted is limited expressly to its terms, and
nothing contained herein shall be deemed to imply any willingness of the Agent
or the Banks to agree to, or otherwise prejudice any rights of the Agent and the
Banks with respect to, any other or similar waiver which may be requested by the
Borrower.
ss.12. CONDITIONS TO EFFECTIVENESS. This Amendment shall be
deemed to be effective as of March 20, 1998 (the "Effective Date"), upon the
Agent's receipt of the following, each in form and substance satisfactory to the
Agent:
(a) facsimile copies of original counterparts (to be
followed promptly by original counterparts) or original counterparts of this
Amendment, duly executed by each of the Company, the Hadco Subsidiaries, the
Agent and the Banks;
(b) copies of the annual financial statements of
Continental Circuits and its Subsidiaries for each of the preceding three fiscal
years of Continental Circuits, each showing a positive net income prior to
adjustments;
(c) evidence of calculations, duly certified by the
principal financial or accounting officer of the Borrower, showing that, after
giving effect to the consummation of the Continental Merger and assuming the
full funding of such Permitted Acquisition on the initial Drawdown Date of the
sole or initial Loan, the proceeds of which are to be used to fund all or any
portion of such Permitted Acquisition, the ratio of Consolidated Funded Debt as
at the most recent fiscal quarter end of the Borrower to EBITDA for the four
consecutive fiscal quarters of the Borrower ending with such quarter end (as
shown on a PRO FORMA basis based upon (i) the most recently delivered financial
statements of the Borrower and its Subsidiaries delivered in accordance with
ss.8.4 of the Agreement and (ii) financial statements for Continental Circuits
and its Subsidiaries as at the most recent fiscal quarter end of the Borrower do
not exceed 3.0:1.0;
(d) a compliance certificate in the form of EXHIBIT C to
the Agreement, duly certified by the principal financial or accounting officer
of the Borrower, indicating the Borrower's compliance with the financial
covenants contained in ss.10 of the Agreement (as amended hereby) immediately
prior to and, on a PRO FORMA basis, immediately following the consummation of
the Continental Merger.
(e) duly executed originals of the Guaranty of Hadco
Acquisition II in substantially the form attached hereto as EXHIBIT X and
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of the Stock Pledge Agreement in substantially the form of EXHIBIT Y hereto,
pursuant to which the Borrower pledges to the Agent, for the benefit of the
Agent and the Banks, all of the capital stock of Hadco Acquisition II to secure
the Obligations;
(f) a duly executed secretary's certificate of the
secretary or assistant secretary of Hadco Acquisition II certifying (and where
applicable, attaching copies of) Hadco Acquisitions II's (i) certificate of
incorporation; (ii) by-laws; (iii) resolutions of the Board of Directors
authorizing the Guaranty and Stock Pledge Agreement referred to in clause (e)
above; and (iv) the incumbency of its officers;
(g) good standing certificates for Hadco Acquisition II,
issued by the Secretary of State of its jurisdiction of incorporation and of
each jurisdiction in which it has qualified to do business;
(h) favorable legal opinions from counsel to Hadco
Acquisition II in substantially the form of EXHIBITS Z-1 and Z-2 hereto,
addressed to each of the Agent and the Banks;
(i) evidence satisfactory to the Agent, of (i) the
payment in full of all outstanding Indebtedness of Continental Circuits and/or
its Subsidiaries (other than Indebtedness described on SCHEDULE 9.1(a) hereto)
and the termination of all commitments to lend with respect thereto, and (ii)
the release of all liens securing such Indebtedness (other than Indebtedness
described on SCHEDULE 9.1(a) hereto) pursuant to UCC-3 termination statements or
other appropriate release or termination documents;
(j) UCC search results against each of Continental
Circuits and its Subsidiaries, as debtors, from jurisdictions satisfactory to
the Agent as disclosed by the certification of each such company as to the
location of its chief executive office, other locations and certain other
information requested by the Agent;
(k) certification from a duly authorized officer of the
Borrower that the Borrower or Hadco Acquisition II has received proper tenders
of securities representing at least a majority of the issued and outstanding
capital stock of Continental Circuits (the "Securities") and as to which
Securities all (if any) rights of withdrawal of the trading shareholders under
Section 14(d)(5) of the Securities Exchange Act of 1934, as amended, and the
regulations thereunder with respect to such Securities shall have expired upon
the purchase thereof;
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(l) certification from a duly authorized officer of the
Borrower that all of the conditions to the purchase of the Securities pursuant
to the Merger Agreement dated February 16, 1998 shall have been satisfied, and
none of such conditions shall have been amended, supplemented or waived except
with the consent of the Agent and the Majority Banks;
(m) copies of each of the Continental Merger Documents
and the Tender Offer Documents (as each such term is defined in the Credit
Agreement, as amended hereby), together with the certification of a duly
authorized officer of the Borrower that such copies are true, correct and
complete and have not been amended, modified, rescinded, evoked or supplemented;
and
(n) Forms U-1 (as specified by Regulation U of the
Federal Reserve Board of Governors) for the Agent and each Bank, duly executed
by the Borrower and Hadco Acquisition II.
ss.13. REPRESENTATIONS AND WARRANTIES; NO DEFAULT;
AUTHORIZATION. Each of the Company and the Hadco Subsidiaries hereby represents
and warrants to each of the Agent and the Banks as follows:
(a) Each of the representations and warranties of the
Company and the Hadco Subsidiaries contained in the Agreement,
the other Loan Documents or in any document or instrument
delivered pursuant to or in connection with the Agreement, the
other Loan Documents or this Amendment was true as of the date
as of which it was made, and no Default or Event of Default has
occurred and is continuing as of the date of this Amendment or
would, following the effectiveness of this Amendment, occur
after giving effect to the Continental Merger; and
(b) This Amendment has been duly authorized, executed and
delivered by the Company and each of the Hadco Subsidiaries,
and shall be in full force and effect upon the satisfaction of
the conditions set forth in ss.12 hereof, and the agreements of
the Company and each of the Hadco Subsidiaries contained
herein, in the Agreement as herein amended, or in the other
Loan Documents respectively, constitute the legal, valid and
binding obligations of the Company and each of the Hadco
Subsidiaries party hereto or thereto, enforceable against the
Company or such Hadco Subsidiary, in accordance with their
respective terms, except as enforceability is limited by
bankruptcy, insolvency, reorganization, moratorium or other
laws relating to or affecting generally the enforcement of
creditors' rights and except to the extent that availability of
the remedy of specific performance or injunctive relief
15
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is subject to the discretion of the court before which any
proceeding therefor may be brought.
(c) Upon the consummation of the Tender Offer, Hadco
Acquisition II will be the owner of all Securities which have
been tendered by the current owners thereof, free from any
lien, security interest, encumbrance and any other claim or
demand;
(d) Each of the representations and warranties made by
the Borrower and Hadco Acquisition II and, to the best of the
Borrower's knowledge, Continental Circuits and its Subsidiaries
in any of the Continental Merger Documents or the Tender Offer
Documents is true and correct in all material respects. Without
limiting the foregoing, all Indebtedness of Continental
Circuits and its Subsidiaries owing to Xxxxx Fargo Bank,
National Association, Bank of America and/or any of their
respective Affiliates has been repaid in full, and any and all
commitments to lend by any such lenders have been terminated.
ss.14. RATIFICATION, ETC. Except as expressly amended hereby,
the Agreement, the other Loan Documents and all documents, instruments and
agreements related thereto are hereby ratified and confirmed in all respects and
shall continue in full force and effect. All references in the Agreement or such
other Loan Documents or in any related agreement or instrument to the Agreement
or such other Loan Documents shall hereafter refer to such agreements as amended
hereby, pursuant to the provisions of the Agreement.
ss.15. NO IMPLIED WAIVER, ETC. Except as expressly provided
herein, nothing contained herein shall constitute a waiver of, impair or
otherwise affect any of the Obligations, any other obligations of the Company or
any of the Hadco Subsidiaries or any right of the Agent or the Banks consequent
thereon. The waivers and consents provided herein are limited strictly to their
terms. Neither the Agent nor any of the Banks shall have any obligation to issue
any further waiver or consent with respect to the subject matter hereof or any
other matter.
ss.16. COUNTERPARTS. This Amendment may be executed in one or
more counterparts, each of which shall be deemed an original but which together
shall constitute one and the same instrument.
ss.17. GOVERNING LAW. THIS AMENDMENT SHALL FOR ALL PURPOSES BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF
16
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MASSACHUSETTS (WITHOUT REFERENCE TO CHOICE OR CONFLICTS OF LAWS).
17
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment as a document under seal as of the date first above written.
HADCO CORPORATION
By: _____________________________
Name:
Title:
BANKBOSTON, N.A., individually
and as Agent
By: _____________________________
Name:
Title: Vice President
ABN AMRO BANK N.V.
By:_________________________ By:______________________________
Name: Name:
Title: Title:
THE BANK OF TOKYO -
MITSUBISHI TRUST COMPANY
By: _____________________________
Name:
Title:
18
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
THE FIRST NATIONAL BANK OF
CHICAGO
By: _______________________________
Name:
Title:
KEYBANK NATIONAL ASSOCIATION.
By: _______________________________
Name:
Title:
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS
ASSOCIATION
By: _______________________________
Name:
Title:
THE BANK OF NOVA SCOTIA
By: _______________________________
Name:
Title:
19
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
THE FUJI BANK, LIMITED
By: _______________________________
Name:
Title:
SUNTRUST BANK, ATLANTA
By:____________________________ By:________________________________
Name: Name:
Title: Title:
THE INDUSTRIAL BANK OF
JAPAN, LIMITED
By: _______________________________
Name:
Title:
CORESTATES BANK, N.A.
By: _______________________________
Name:
Title:
STATE STREET BANK AND TRUST COMPANY
By: _______________________________
Name:
Title:
20
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
MELLON BANK, N.A.
By: __________________________________
Name:
Title:
THE SANWA BANK, LIMITED
By:___________________________________
Name:
Title:
THE SUMITOMO BANK, LIMITED
By: __________________________________
Name:
Title:
21
SIGNATURE PAGE TO THE
FIRST AMENDMENT AND MODIFICATION AGREEMENT
The undersigned hereby acknowledges the foregoing Amendment as of the Effective
Date and agrees that its obligations under the Guaranty will extend to the
Agreement, as so amended, and the other Loan Documents, as so amended.
HADCO SANTA XXXXX, INC.
By:___________________________________
Title:
HADCO ACQUISITION CORP. II
By:___________________________________
Title:
