SEVENTH AMENDMENT TO AMENDED AND
RESTATED LOAN AND SECURITY AGREEMENT
THIS SEVENTH AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
("Amendment"), dated effective as of October 27, 1999 (the "Amendment Effective
Date"), is executed and entered into by and among OUTBOARD MARINE CORPORATION, a
Delaware corporation ("OMC"), OMC ALUMINUM BOAT GROUP, INC., a Delaware
corporation OMC FISHING BOAT GROUP, INC., a Delaware corporation, OMC LATIN
AMERICA/CARIBBEAN, INC., a Delaware corporation, RECREATIONAL BOAT GROUP LIMITED
PARTNERSHIP, a Delaware limited partnership, OMC RECREATIONAL BOAT GROUP, INC.,
a Delaware corporation (collectively all of the "Loan Parties," as of the
Amendment Effective Date, under the Amended and Restated Loan and Security
Agreement referenced under the Recitals hereinbelow; herein called the "Loan
Parties"), each of the lending institutions signatory hereto (collectively all
of the "Lenders," as of the Amendment Effective Date, under the Amended and
Restated Loan and Security Agreement referenced under the Recitals hereinbelow;
herein called the ("Lenders") and BANK OF AMERICA, N.A., (a national banking
association and successor in interest to Bank of America, N.A., formerly
NationsBank, N.A., successor in interest to NationsBank of Texas, N.A.), in its
capacity as agent for itself and the other Lenders (in such capacity, together
with its successors and assigns in such capacity, herein called "Agent").
RECITALS:
--------
A. The Loan Parties, the Lenders and Agent are parties to the certain
Amended and Restated Loan and Security Agreement dated effective as of January
6, 1998, as amended by the certain First Amendment to Loan and Security
Agreement dated effective as of May 21, 1998, the Second Amendment to Amended
and Restated Loan and Security Agreement dated effective as of August 31, 1998,
the Third Amendment to Amended and Restated Loan and Security Agreement dated
effective as of December 21, 1998, the Fourth Amendment to Amended and Restated
Loan and Security Agreement dated effective as of February 1, 1999, the Fifth
Amendment to Amended and Restated Loan and Security Agreement dated effective as
of February 25, 1999 and the Sixth Amendment to Amended and Restated Loan and
Security Agreement dated effective as of July 30, 1999 (hereinafter called the
"Agreement"). Unless otherwise defined in this Amendment, terms defined by the
Agreement, where used in this Amendment, shall have the same meanings as are
prescribed by the Agreement, as amended by this Amendment.
B. The Loan Parties, the Lenders and Agent have agreed to amend the
Agreement as provided hereinbelow.
NOW THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto hereby agree as follows:
ARTICLE 1
Definitions
-----------
Section 1.1 Definitions. Unless otherwise defined in this Amendment,
terms defined by the Agreement, where used in this Agreement, shall have the
same meanings in this Amendment as are prescribed by the Agreement.
ARTICLE 2
Amendments
----------
Section 2.1 Amendment to Definitions in Article 1 of the Agreement.
Effective as of the Amendment Effective Date, the following definition in
Article 1 of the Agreement is hereby amended and restated in its entirety to
read as follows:
"Borrowing Base" means, at any time, an amount equal to the lesser of:
(a) the maximum principal amount of the Revolving Credit
Facility, minus the sum of
(i) the Letter of Credit Reserve, plus
(ii) the Reserve, or
(b) an amount equal to the sum of
(i) 85% (or such lesser percentage as Agent may determine
pursuant to Section 2.5) of the face value of
Eligible Receivables that are determined by Agent in
its discretion to be Qualified L/C Supported
Receivables at such time, plus
(ii) 85% (or such lesser percentage as Agent may determine
pursuant to Section 2.5) of the face value of
Eligible Receivables that are determined by Agent in
its discretion to be Qualified Guaranteed Receivables
at such time, plus
(iii) 85% (or such lesser percentage as Agent may determine
pursuant to Section 2.5) of the face value of
Eligible Domestic Receivables (other than Qualified
L/C Supported Receivables or Qualified Guaranteed
Receivables) at such time, plus
(iv) 75% (or such lesser percentage as Agent may determine
pursuant to Section 2.5) of the Dollar Equivalent
face value of Eligible Foreign Receivables (other
than Qualified L/C Supported Receivables or Qualified
Guaranteed Receivables) at such time,
plus
----
(v) the lesser of
(A) 60% with respect to Eligible Domestic Inventory
and 50% with respect to Eligible Foreign
Inventory (or such lesser percentage as Agent
may determine pursuant to Section 2.5) of the
lesser of cost determined on a FIFO (or
first-in-first-out) accounting basis or fair
market value of such Eligible Inventory, as
applicable, net of the Loan Parties' reserve for
obsolescence (if any), at such time, plus, the
following percentage, as applicable (or such
lesser percentage as Agent may in its discretion
determine from time to time) of the lesser of
cost determined on a FIFO (or first-in-first-
out) accounting basis or fair market value of
Eligible Work-In-Process Inventory, net of the
Loan Parties' reserve for obsolescence (if any):
(i) 35% during the period of January 1, 1998
through April 30, 1998, (ii) 35% during the
period of January 1, 1999 through June 30, 1999,
(iii) 35% during the period July 30, 1999
through August 31, 1999, (iv) 17.5% during the
period September 1, 1999 through September 30,
1999 and (v) 35% during the period of January 1
through April 30 of any calendar year
thereafter, or
(B) $75,000,000, minus
(vi) the Letter of Credit Reserve; plus
(vii) provided that the representations of Borrowers under
Section 7.1(z) are and remain true and correct, with
respect to any period commencing during any calendar
year, determined as provided hereinbelow (each such
period herein called a "Designated" Period") (i)
$30,000,000 at any time during any portion of any
single Designated Period that occurs from the
Agreement Date through December 30, 1998, (ii)
$20,000,000 at any time during any portion of any
single Designated Period that occurs during the
period from December 31, 1998 through January 31,
1999, (iii) $30,000,000 at any time during any
portion of any two Designated Periods that occur
during the period February 1, 1999 through December
31, 1999, (iv) $10,000,000 at any time during any
portion of any single Designated Period that occurs
during the period from December 31, 1999 through
December
3
and (iv) $0.00 on and at all times after December 31,
2000; provided, that any such Designated Period for any
calendar year shall begin on the first Business Day, if
any, occurring during such year (or, with respect to
the second of the Designated Periods referenced in
clause (iii), on the first Business Day, if any,
occurring after expiration of the first of such
Designated Periods) on which the aggregate outstanding
balance of Loans first exceeds an amount equal to the
aggregate amount determined under paragraph (b) of this
definition without regard to this subparagraph (vii),
and shall terminate on the earlier of (x) the
expiration of one hundred eighty (180) days thereafter
or (y) December 31, 1999 with respect to the calendar
year 1999 or any calendar year thereafter,
provided, that with respect to clause (b) preceding, Agent may
deduct any Reserve prior to application of the relevant
percentages used to calculate the Borrowing Base as set forth
herein.
ARTICLE 3
Miscellaneous
-------------
Section 3.1 Conditions Precedent. The effectiveness of this Amendment is
subject to the satisfaction of each of the following conditions precedent:
(a) Agent shall have received all of the following, each dated the
date of this Amendment (unless otherwise indicated), in form and substance
satisfactory to Agent:
(i) Amendment Documents. This Amendment and any other
instrument, document or certificate required by Agent to be executed
or delivered by any of the Loan Parties, Agent or the Lenders in
connection with this Amendment, in each case duly executed (the
"Amendment Documents");
(ii) Fees and Expenses. Evidence that the costs and expenses
(including, without limitation, reasonable attorneys' fees and
expenses) incurred by Agent incident to this Amendment or otherwise
required to be paid in accordance with Section 16.2 of the Agreement,
to the extent incurred and submitted to the Loan Parties, shall have
been paid in full;
(iii) Additional Information. Agent shall have received such
additional documents, instruments and information as Agent may
reasonably request to effect the transactions contemplated hereby; and
4
(iv) Consents. All consents required by Section 16.9 of the
Agreement shall have been obtained (it being understood that, pursuant
to Section 16.9 of the Agreement, consent of Agent and all Lenders
shall be required as a condition for effectiveness of this Amendment).
(c) The representations and warranties contained herein, in the
Agreement and in all other Loan Documents, as amended hereby, shall be true
and correct as of the date hereof as if made on the date hereof (except
those, if any, which by their terms specifically relate only to a different
date).
(d) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all other agreements,
documents and instruments executed and/or delivered pursuant hereto, and
all legal matters incident thereto, shall be satisfactory to Agent.
(e) No Default or Event of Default shall have occurred and be
continuing.
Section 3.2 Representations and Warranties. The Loan Parties hereby
represent and warrant to, and agree with, Agent, for the benefit of the Lenders,
that, as of the date of and after giving effect to this Amendment, (a) the
execution, delivery and performance of this Amendment and any and all other
Amendment Documents executed and/or delivered in connection herewith have been
authorized by all requisite corporate action on the part of each of the Loan
Parties (as applicable) and will not violate any of such Loan Party's
certificate of incorporation or bylaws (or, in the case of Recreational Boat
Group Limited Partnership, its certificate of limited partnership or its limited
partnership agreement), (b) all representations and warranties set forth in the
Agreement and in any other Loan Document are true and correct as if made again
on and as of such date (except those, if any, which by their terms specifically
relate only to a different date) in the Agreement), (d) no Default or Event of
Default has occurred and is continuing, (e) the Agreement (as amended by this
Amendment), and all other Loan Documents are and remain legal, valid, binding
and enforceable obligations in accordance with the terms thereof, and (f) the
certifications delivered to Agent under clause (i), clause (ii) and clause (iii)
of Section 6.1(c) of the Agreement (in the case of the certification required by
such clause (iii), as subsequently modified pursuant to Section 6.2(b) of the
Agreement) remain true, correct and complete as of the Amendment Effective Date.
Section 3.3 Survival of Representations and Warranties. All
representations and warranties made in this Amendment or any other Loan Document
shall survive the execution and delivery of this Amendment and the other Loan
Documents, and no investigation by Agent or any Lender, or any closing, shall
affect the representations and warranties or the right of Agent and the Lenders
to rely upon them.
Section 3.4 Reference to Agreement. Each of the Loan Documents, including
the Agreement, the Amendment Documents and any and all other agreements,
documents or instruments now or hereafter executed and/or delivered pursuant to
the terms hereof or pursuant to the terms of the Agreement as amended hereby,
are hereby amended so that any reference in such Loan Documents to the
Agreement, whether direct or indirect, shall mean a reference to the Agreement
as amended hereby.
5
Section 3.5 Severability. Any provision of this Amendment held by a court
of competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
Section 3.6 Successors and Assigns. This Amendment is binding upon and
shall inure to the benefit of the Credit Parties and the Loan Parties and their
respective successors and assigns, except each of the Loan Parties may not
assign or transfer any of its rights or obligations hereunder without the prior
written consent of Agent and the Lenders.
Section 3.7 General. This Amendment, when signed by each signatory as
provided hereinbelow (i) shall be deemed effective prospectively as of the
Amendment Effective Date, (ii) contains the entire agreement among the parties
and may not be amended or modified except in writing signed by all parties,
(iii) shall be governed and construed according to the laws of the State of
Texas, and (iv) may be executed in any number of counterparts, each of which
shall be valid as an original and all of which shall be one and the same
agreement. A telecopy or other electronic transmission of any executed
counterpart shall be deemed valid as an original.
THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL AGREEMENTS
BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized officers in several counterparts effective
as of the date specified in the preamble hereof.
BORROWERS:
OUTBOARD MARINE CORPORATION
By: /s/ Xxxx X. Xxxxxxxx
-----------------------------
Name: Xxxx X. Xxxxxxxx
---------------------------
Title: Vice President & Treasurer
--------------------------
By: /s/ Xxxxxx X. Xxxx
----------------------------
Name: Xxxxxx X. Xxxx
---------------------------
Title: Assistant Secretary
--------------------------
6
OMC ALUMINUM BOAT GROUP, INC.
By: /s/ Xxxx X. Xxxxxxxx
--------------------------
Name: Xxxx X. Xxxxxxxx
------------------------
Title: Treasurer
-----------------------
By: /s/ Xxxxxx X. Xxxx
-------------------------
Name: Xxxxxx X. Xxxx
------------------------
Title: Asst. Secretary
-----------------------
7
OMC FISHING BOAT GROUP, INC.
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxxxx
-----------------------------------
Title: Treasurer
----------------------------------
By: /s/ Xxxxxx X. Xxxx
-------------------------------------
Name: Xxxxxx X. Xxxx
-----------------------------------
Title: Assistant Secretary
----------------------------------
OMC LATIN AMERICA/CARIBBEAN, INC.
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxxxx
-----------------------------------
Title: Vice President
----------------------------------
By: /s/ Xxxxxx X. Xxxx
-------------------------------------
Name: Xxxxxx X. Xxxx
-----------------------------------
Title: Assistant Secretary
----------------------------------
RECREATIONAL BOAT GROUP
LIMITED PARTNERSHIP
By: OMC Recreational Boat Group, Inc.,
General Partner
By: /s/ Xxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxxx
---------------------------------
Title: Treasurer
--------------------------------
By: /s/ Xxxxxx X. Xxxx
-----------------------------------
Name: Xxxxxx X. Xxxx
---------------------------------
Title: Assistant Secretary
--------------------------------
8
GUARANTOR:
OMC RECREATIONAL BOAT GROUP, INC.
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxxxx
-----------------------------------
Title: Treasurer
----------------------------------
By: /s/ Xxxxxx X. Xxxx
-------------------------------------
Name: Xxxxxx X. Xxxx
-----------------------------------
Title: Assistant Secretary
----------------------------------
9
AGENT:
BANK OF AMERICA, N.A.
In its capacity as Agent
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
-----------------------------------
Title: Vice President
----------------------------------
10
LENDERS:
BANK OF AMERICA, N.A.
In its capacity as Agent
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
-----------------------------------
Title: Vice President
----------------------------------
11
AMERICAN NATIONAL BANK AND
TRUST COMPANY OF CHICAGO
By: /s/ Xxxxx X. Xxxxx
----------------------------------
Name: Xxxxx X. Xxxxx
-------------------------------
Title: Vice President
-------------------------------
12
FLEET CAPITAL CORPORATION
By: /s/ Xxxxxx Xxxxxx
----------------------------------
Name: Xxxxxx Xxxxxx
--------------------------------
Title: Vice President
-------------------------------
13
THE CIT GROUP/BUSINESS CREDIT, INC.
By: /s/ Xxxx Xxxxxxxx
----------------------------------
Name: Xxxx Xxxxxxxx
-------------------------------
Title: Assistant Vice President
-------------------------------
14
TRANSAMERICA BUSINESS CREDIT
CORPORATION
By: /s/ Xxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxx X. Xxxxx
-------------------------------
Title: Senior Vice President
-------------------------------
15
FLEET BUSINESS CREDIT CORPORATION
By: /s/ Xxxxxx Xxxxxx
---------------------------------
Name: Xxxxxx Xxxxxx
-------------------------------
Title: Vice President
-------------------------------
16
