EXHIBIT 4.11
AMENDMENT NO. 6 AND WAIVER TO THE
CREDIT AGREEMENT
Dated as of August 5, 2003
AMENDMENT NO. 6 AND WAIVER TO THE CREDIT AGREEMENT among DRESSER, INC., a
Delaware corporation (the "U.S. Borrower"), and D.I. LUXEMBOURG S.A.R.L., a
corporation organized and existing under the laws of Luxembourg (the "Euro
Borrower", and, collectively with the U.S. Borrower, the "Borrowers"), DEG
ACQUISITIONS, LLC, a limited liability company organized and existing under the
laws of Delaware ("DEG Acquisitions"), DRESSER HOLDINGS, INC., a Delaware
corporation ("Dresser Holdings"), the Subsidiary Guarantors party to the Credit
Agreement referred to below (the "Subsidiary Guarantors"), the banks, financial
institutions and other institutional lenders party to the Credit Agreement
referred to below (collectively, the "Lenders"), XXXXX FARGO BANK TEXAS, N.A.,
as the swing line bank, XXXXXX XXXXXXX & CO. INCORPORATED, as collateral agent
(the "Collateral Agent"), XXXXXX XXXXXXX SENIOR FUNDING, INC., as
administrative agent (the "Administrative Agent") for the Lenders and CREDIT
SUISSE FIRST BOSTON, as syndication agent (the "Syndication Agent", and
together with the Collateral Agent and the Administrative Agent, the "Agents").
PRELIMINARY STATEMENTS:
(1) The Borrowers, DEG Acquisitions, the Subsidiary Guarantors, the Lenders
and the Agents have entered into a Credit Agreement dated as of April 10, 2001,
as amended by Amendment No. 1 thereto dated as of March 13, 2002, Amendment No.
2 thereto dated as of June 17, 2002, Amendment No. 3 thereto dated as of
December 11, 2002, Amendment No. 4 and Waiver thereto dated as of March 31,
2003 and Amendment No. 5 dated as of June 30, 2003 (such Credit Agreement, as
amended, supplemented or otherwise modified through the date hereof, the
"Credit Agreement"). Dresser Holdings has entered into an Assignment and
Assumption Agreement dated as of July 3, 2002 with DEG Acquisitions whereby
Dresser Holdings assumed the duties and liabilities of DEG Acquisitions under
the Credit Agreement and the Security Agreement. Capitalized terms not
otherwise defined in this Amendment No. 6 and Waiver have the same meanings as
specified in the Credit Agreement.
(2) The Borrowers have requested that the Lenders amend (i) certain
provisions of the Credit Agreement and (ii) waive certain Defaults and Events
of Default under the Credit Agreement, in each case as provided herein.
(3) The Lenders party hereto, constituting not less than the Required
Lenders are, on the terms and conditions stated below, willing to grant the
request of the Borrowers as hereinafter set forth.
NOW, THEREFORE, for good and valuable consideration the sufficiency of which
is hereby acknowledged, and subject to the terms and conditions of this
Amendment No. 6 and Waiver, the parties agree as follows:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
2
SECTION 1. The Amendment. Subject to the satisfaction of the conditions
precedent set forth in Section 3, the Credit Agreement is, effective as of the
date hereof, hereby amended as follows:
(a) The following definitions are hereby added to Section 1.01 of the
Credit Agreement in correct alphabetical order:
""Amendment No. 5 " means Amendment No. 5 to this Agreement dated as
of June 30, 2003 among the Borrowers, DEG Acquisitions, the Subsidiary
Guarantors, the Lenders party thereto and the Agents."
""Amendment No. 6 and Waiver " means Amendment No. 6 and Waiver to
this Agreement dated as of August 5, 2003 among the Borrowers, DEG
Acquisitions, the Subsidiary Guarantors, the Lenders party thereto and
the Agents."
""Amendment No. 6 and Waiver Effective Date" has the meaning set
forth in Section 3 of Amendment No. 6 and Waiver."
(b) The definition of "EBITDA" is amended in full to read:
""EBITDA" means, in each case of the U.S. Borrower and each of its
Subsidiaries, for any period, the sum (without duplication) of (a) Net
Income, (b) to the extent Net Income has been reduced thereby, (i) all
income taxes and foreign withholding taxes paid or accrued for such
period, (ii) Interest Expense, (iii) Non-cash Charges less any non-cash
items increasing Net Income for such period (other than normal accruals
in the ordinary course of business), (iv) any cash charges resulting
from the Transactions and the related financings that, in each case, are
incurred prior to the six month anniversary of the Initial Extension of
Credit, and (v) any non-capitalized transactions costs incurred in
connection with actual, proposed or abandoned financings, acquisitions
or divestitures, including, but not limited to, financing and
refinancing fees and costs incurred in connection with the Transactions,
all as determined in accordance with GAAP for such period, (c) an
allowance for losses (including lost earnings and incremental costs)
incurred by the U.S. Borrower during the second and third fiscal
quarters of the Fiscal Year ended December 31, 2003 attributable to a
labor dispute at the Waukesha plant commencing on or about May 1, 2003,
as reasonably determined in good faith by the U.S. Borrower, in an
aggregate amount for all such losses under this clause (c) not to exceed
$13,000,000, and (d) (1) fees and expenses related to or resulting from
the re-audit and restatement of financial statements of the U.S.
Borrower and its Subsidiaries (including the fees of accountants, legal
counsel and others engaged to perform services in connection therewith),
(2) fees payable and expenses incurred in connection with Amendment Xx.
0 xxx Xxxxxx, Xxxxxxxxx Xx. 0 xxx Xxxxxxxxx Xx. 0 and Waiver, and (3)
fees payable in an aggregate amount reasonably approved by the
Administrative Agent and expenses incurred in connection with a consent
solicitation relating to Section 4.03 of the Indenture under which the
Senior Subordinated Debt was issued.
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
3
Notwithstanding the foregoing, for purposes of the periods specified
below, Consolidated EBITDA of the U.S. Borrower and its Subsidiaries
shall mean the amount specified below:
Quarter Ending Consolidated EBITDA
------------------ -------------------
December 31, 2000 ......... U.S.$ 58,300,000
March 31, 2001 ............ U.S.$ 54,900,000
June 30, 2001 ............. U.S.$ 56,067,000
September 30, 2001 ........ U.S.$ 58,920,000
December 31, 2001 ......... U.S.$ 59,652,000
March 31, 2002 ............ U.S.$ 43,691,000
June 30, 2002 ............. U.S.$ 47,700,000
September 30, 2002 ........ U.S.$ 46,900,000
December 31, 2002 ......... U.S.$ 29,400,000
March 31, 2003 ............ U.S.$ 38,332,000
(c) The definition of "Applicable Margin" is amended by deleting the last
two sentences in their entirety and substituting therefor the following:
"Notwithstanding anything herein to the contrary but subject to the
immediately succeeding sentence, for all purposes of the Agreement, the
Applicable Margin shall be at Level VI during the period beginning on
January 1, 2003 and ending on the date that the conditions set forth in
Section 5.01(p) are met, and thereafter shall be determined in
accordance with this definition without giving effect to this sentence.
For all purposes of the Agreement, the Applicable Margin in effect from
time to time pursuant to any of the foregoing for each of the Eurodollar
Rate Advances and the Base Rate Advances shall increase by (x) during
the period of time beginning on the Amendment No. 4 and Waiver Effective
Date and ending on the date immediately prior to the Amendment No. 6 and
Waiver Effective Date, 0.50%; and (y) during the period of time
beginning on the Amendment No. 6 and Waiver Effective Date through the
end of the Suspension Period, 1.00%."
(d) The definition of "Suspension Period" is amended in full to read as
follows:
""Suspension Period" means the period of time beginning on the
Amendment No. 4 and Waiver Effective Date and ending on the earlier of
(i) December 15, 2003 and (ii) the date on which the Agents receive (x)
the audited annual financial statements for the U.S. Borrower and its
Subsidiaries for the Fiscal Year ended in 2002 and (y) the revised,
audited financial statements for the U.S. Borrower and its Subsidiaries
for the Fiscal Year ended in 2001, in each case, in accordance with the
requirements set forth in Section 5.01(p)."
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
4
(e) Section 5.01 is amended by adding the following clause (p) at the end
thereof:
"(p) Prior to December 15, 2003, the U.S. Borrower shall furnish to
the Agents and the Lender Parties revised, audited annual financial
statements for the Fiscal Year ended in 2001 and audited annual
financial statements for the Fiscal Year ended in 2002, in each case as
required by Section 5.03(b)."
(f) Section 5.02(n) of the Credit Agreement is amended by deleting the
amount "$15,000,000" specified in clause (1) thereof and substituting
therefor the amount "$35,000,000".
SECTION 2. Waiver and Standstill. (a) Subject to Section 3 hereof, the
Required Lenders hereby waive any Default or Event of Default in respect of the
provisions of Sections 2.06(b)(ii) (but only in respect of equity proceeds in
an amount not greater than $10,000,000 used to finance an asset acquisition),
2.07(a), 2.08(c), 3.01(a)(vi), 3.01(c), 3.01(e), 3.01(i), 3.02, 4.01(g),
4.01(h), 4.01(i), 4.01(j), 4.01(q)(ii), 5.01(a), 5.01(g), 5.02(b)(ii)(F) and
(G), 5.02(f)(vii), (viii) and (ix), 5.02(g), 5.03(a), 5.03(b), 5.03(c),
5.03(d), 5.04(a) and 5.04(b) of the Credit Agreement and any related or
substantially comparable provision of any Loan Document, in each case
consisting of, resulting from or relating in any respect to (i) the re-audit,
revision or restatement of any financial statement delivered prior to the date
of this Amendment by the U.S. Borrower or any of its Subsidiaries (including,
without limitation, any misstatement therein or in any certificate,
representation or warranty relating thereto and any error, defect or deficiency
in accounting procedures or in the application of accounting principles
reflected thereby or relating thereto or the absence of audited financial
statements for any fiscal period prior to Fiscal Year 2001), (ii) any failure
to deliver any such financial statement when or as required, except as required
by Section 5.01(p), (iii) any failure to comply with any obligation that became
required to be performed or observed under any of such provisions by reason of
the occurrence of any such Default or Event of Default or (iv) any misstatement
as to the absence of any such Default or Event of Default.
(b) Subject to Section 3 hereof, the Required Lenders waive any Default or
Event of Default now existing or hereafter arising under Section 6.01(e) of the
Credit Agreement resulting from a default under Section 4.03 of the Indenture
under which the Senior Subordinated Debt was issued; provided, however, that
the exercise by the Trustee or the requisite holders of Senior Subordinated
Notes of their right to give a notice of acceleration pursuant to Section 6.02
of such Indenture by reason of the existence of such default under Section 4.03
of the Indenture shall constitute an immediate Event of Default.
SECTION 3. Conditions of Effectiveness. This Amendment No. 6 and Waiver
shall become effective as of the first date (the "Amendment No. 6 and Waiver
Effective Date") on which each of the following conditions precedents shall
have been satisfied:
(a) The Administrative Agent shall have received counterparts of this
Amendment No. 6 and Waiver executed by the Borrowers, DEG Acquisitions,
Dresser Holdings and the Required Lenders or, as to any of the Lenders,
advice satisfactory to the Administrative Agent that such Lender has
executed this Amendment No. 6 and Waiver.
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
5
(b) All of the accrued fees and expenses of the Administrative Agent
(including the accrued fees and expenses of counsel for the Administrative
Agent) for which invoices shall have been submitted shall have been paid in
full.
(c) The Administrative Agent shall have received the consent attached
hereto duly executed by each Guarantor and each Grantor.
(d) The U.S. Borrower shall have paid to the Administrative Agent, for
the benefit of the applicable Lenders, a fee equal to 0.25% of the aggregate
Commitments of each Lender that has executed and delivered this Amendment
No. 6 and Waiver on or before August 5, 2003.
This Amendment No. 6 and Waiver is subject to the provisions of Section 9.01
of the Credit Agreement.
SECTION 4. Representations and Warranties of the Borrower. Each Borrower
represents and warrants as follows:
(a) On the date hereof, after giving effect to this Amendment No. 6 and
Waiver, (i) no event has occurred and is continuing, or would result from
the effectiveness of this Amendment No. 6 and Waiver, that constitutes a
Default and (ii) all representations and warranties set forth in the Loan
Documents shall be true and correct in all material respects.
(b) No authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body or any other
third party is required for the due execution, delivery or performance by
the Borrowers of this Amendment No. 6 and Waiver and by the Guarantors and
the Grantors of the consent attached hereto or other transactions
contemplated hereby.
(c) This Amendment No. 6 and Waiver has been duly executed and delivered
by the Borrowers. The consent attached hereto has been duly executed and
delivered by each of the Guarantors and the Grantors. This Amendment No. 6
and Waiver and each of the other Loan Documents, as amended hereby, to which
each Borrower, each Guarantor and each Grantor is a party are legal, valid
and binding obligations of such Borrower, such Guarantor and such Grantor,
as applicable, enforceable against such Borrower, such Guarantor and such
Grantor, as applicable, in accordance with their respective terms.
SECTION 5. Reference to and Effect on the Credit Agreement and the Notes.
(a) On and after the effectiveness of this Amendment No. 6 and Waiver, each
reference in the Credit Agreement to "this Agreement", "hereunder", "hereof" or
words of like import referring to the Credit Agreement, and each reference in
the Notes and each of the other Loan Documents to "the Credit Agreement",
"thereunder", "thereof" or words of like import referring to the Credit
Agreement, shall mean and be a reference to the Credit Agreement, as amended by
this Amendment No. 6 and Waiver.
(b) The Credit Agreement, the Notes and each of the other Loan Documents, as
specifically amended by this Amendment No. 6 and Waiver, are and shall continue
to be in
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
6
full force and effect and are hereby in all respects ratified and confirmed.
Without limiting the generality of the foregoing, the Collateral Documents and
all of the Collateral described therein do and shall continue to secure the
payment of all Obligations of the Loan Parties under the Loan Documents, in
each case as amended by this Amendment No. 6 and Waiver.
(c) The execution, delivery and effectiveness of this Amendment No. 6 and
Waiver shall not, except as expressly provided herein, operate as a waiver of
any right, power or remedy of any Lender or the Administrative Agent under any
of the Loan Documents, nor constitute a waiver of any provision of any of the
Loan Documents.
SECTION 6. Execution in Counterparts. This Amendment No. 6 and Waiver may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Amendment No. 6 and Waiver by telecopier shall be effective as delivery of a
manually executed counterpart of this Amendment No. 6 and Waiver.
SECTION 7. Governing Law. This Amendment No. 6 and Waiver shall be governed
by, and construed in accordance with, the laws of the State of New York.
[SIGNATURE PAGES IMMEDIATELY FOLLOW]
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 6 and
Waiver to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
DRESSER, INC., as U.S. Borrower
By
-----------------------------
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
D.I. LUXEMBOURG S.A.R.L., as Euro
Borrower
By _______________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
DEG ACQUISITIONS, LLC
By: FIRST RESERVE FUND VIII, L.P., a
Delaware limited partnership, its
Manager
By: FIRST RESERVE GP VIII, L.P., a
Delaware limited partnership, its
general partner
By: FIRST RESERVE CORPORATION, a
Delaware corporation, its
general partner
By: ______________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
DRESSER HOLDINGS, INC.
By _______________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
XXXXXX XXXXXXX SENIOR FUNDING, INC.,
as Administrative Agent
By _______________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
XXXXXX XXXXXXX & CO. INCORPORATED,
as Collateral Agent
By _______________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
CREDIT SUISSE FIRST BOSTON, as
Syndication Agent
By _______________________________
Name:
Title:
By _______________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
GENERAL ELECTRIC CAPITAL
CORPORATION, as Co-Documentation
Agent
By _______________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
REVOLVING CREDIT LENDERS, TRANCHEA
EURO TERM LENDERS AND TRANCHE AU.S.
TERM LENDERS
_____________________________________
[Print Name of Financial Institution]
By ____________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
TRANCHE B TERM LENDERS
____________________________________
[Print Name of Financial Institution]
By ____________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
ISSUING BANKS
XXXXX FARGO BANK, N.A.
By ____________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
CREDIT SUISSE FIRST BOSTON
By ____________________________
Name:
Title:
By ____________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
SWING LINE BANK
XXXXX FARGO BANK TEXAS, N.A.
By ____________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
CONSENT
Dated as of August 5, 2003
Each of the undersigned as a Loan Party under the Credit Agreement referred
to in the foregoing Amendment No. 6 and Waiver and as Grantor under the Security
Agreement dated as of April 10, 2001 (as amended, supplemented or otherwise
modified from time to time, the "Security Agreement") in favor of the Collateral
Agent, for its benefit and the benefit of the Lenders party to the Credit
Agreement referred to in the foregoing Amendment No. 6 and Waiver, hereby
consents to such Amendment No. 6 and Waiver and hereby confirms and agrees that
(a) notwithstanding the effectiveness of such Amendment No. 6 and Waiver, each
Loan Document is, and shall continue to be, in full force and effect and is
hereby ratified and confirmed in all respects, except that, on and after the
effectiveness of such Amendment No. 6 and Waiver, each reference in each Loan
Document to the "Credit Agreement", "thereunder", "thereof" or words of like
import shall mean and be a reference to the Credit Agreement, as amended by such
Amendment No. 6 and Waiver, and (b) the Collateral Documents to which such
Grantor is a party and all of the Collateral described therein do, and shall
continue to, secure the payment of all of the Secured Obligations (in each case,
as defined therein).
DEG ACQUISITIONS, LLC
By: FIRST RESERVE FUND VIII, L.P., a
Delaware limited partnership, its
Manager
By: FIRST RESERVE GP VIII, L.P., a
Delaware limited partnership,
its general partner
By: FIRST RESERVE CORPORATION,
a Delaware corporation, its
general partner
By: ____________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
DRESSER HOLDINGS, INC.
By ____________________________
Name:
Title:
DRESSER INTERNATIONAL, INC.
By ____________________________
Name:
Title:
DRESSER RE, INC.
By ____________________________
Name:
Title:
DRESSER RUSSIA, INC.
By ____________________________
Name:
Title:
LVF HOLDING CORPORATION
By ____________________________
Name:
Title:
MODERN ACQUISITION, INC.
By ____________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
DRESSER ENTECH, INC.
By ____________________________
Name:
Title:
RING-O VALVE, INCORPORATED
By ____________________________
Name:
Title:
Amendment No. 6 and Waiver to the
Dresser Credit Agreement
