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[EXECUTION COPY]
SECOND AMENDMENT
TO
SHORT TERM REVOLVING CREDIT AGREEMENT
This SECOND AMENDMENT TO SHORT TERM REVOLVING CREDIT AGREEMENT, dated as
of September 24, 1996 (this "Amendatory Agreement"), is among HANDY & XXXXXX, a
New York corporation (the "Borrower"), certain financial institutions
signatories hereto (the "Lenders"), THE BANK OF NOVA SCOTIA, THE CHASE MANHATTAN
BANK (formerly known as Chemical Bank) and THE BANK OF NEW YORK, as the
co-agents (collectively referred to herein as the "Co-Agents"), and THE BANK OF
NOVA SCOTIA, as administrative agent (the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders, the Co-Agents and the Administrative
Agent are parties to a Short Term Revolving Credit Agreement, dated as of
September 28, 1994 (as amended or otherwise modified to the date hereof, the
"Existing Credit Agreement"); and
WHEREAS, the parties hereto have agreed, subject to the conditions and
terms hereinafter set forth, to amend the Existing Credit Agreement in certain
respects as herein provided (the Existing Credit Agreement, as so amended by
this Amendatory Agreement, being referred to as the "Credit Agreement");
NOW, THEREFORE, in consideration of the agreements herein contained, the
parties hereto agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. Certain Definitions. The following terms (whether or not
underscored) when used in this Amendatory Agreement shall have the following
meanings (such meanings to be equally applicable to the singular and plural form
thereof):
"Administrative Agent" is defined in the preamble.
"Amendatory Agreement" is defined in the preamble.
"Borrower" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Credit Agreement" is defined in the second recital.
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"Existing Credit Agreement" is defined in the first recital.
"Lenders" is defined in the preamble.
"Second Amendment Effective Date" is defined in Subpart 4.1.
SUBPART 1.2. Other Definitions. Terms for which meanings are provided in
the Existing Credit Agreement are, unless otherwise defined herein or the
context otherwise requires, used in this Amendatory Agreement with such
meanings.
PART II
AMENDMENTS TO THE
EXISTING CREDIT AGREEMENT
AND EXTENSION OF STATED MATURITY DATE
Effective on (and subject to the occurrence of) the Second Amendment
Effective Date, the Existing Credit Agreement is hereby amended and the Stated
Maturity Date is hereby extended in accordance with this Part II; except as so
amended, the Existing Credit Agreement shall continue in full force and effect.
SUBPART 2.1. Amendments to Article I. Article I of the Existing Credit
Agreement is hereby amended in accordance with Subparts 2.1.1 through 2.1.2.
SUBPART 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby
amended by inserting the following definitions in such Section in the
appropriate alphabetical sequence:
"Applicable Commitment Fee Margin" means the lowest per annum rate
determined by reference to the Net Debt to EBITDA Ratio and EBITDA to
Interest Ratio, in each case that is satisfied for each of such ratios in
a given clause below and as indicated in the Compliance Certificate most
recently delivered pursuant to clause (c) of Section 7.1.1, equal to:
(a) 0.11% if the Net Debt to EBITDA Ratio is less than or
equal to 1.75:1 and the EBITDA to Interest Ratio is greater than or
equal to 5.0:1;
(b) 0.15% if the Net Debt to EBITDA Ratio is less than or
equal to 2.25:1 and the EBITDA to Interest Ratio is greater than or
equal to 3.75:1;
(c) 0.1875% if the Net Debt to EBITDA Ratio is less than or
equal to 2.75:1 and the EBITDA to Interest Ratio is greater than or
equal to 3.00:1; and
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(d) 0.225% if the Net Debt to EBITDA Ratio is greater than
2.75:1 or the EBITDA to Interest Ratio is less than 3.00:1.
The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio used
to compute the Applicable Commitment Fee Margin shall be the Net Debt to
EBITDA Ratio and the EBITDA to Interest Ratio, as the case may be, set
forth in the Compliance Certificate most recently delivered by the
Borrower to the Administrative Agent pursuant to clause (c) of Section
7.1.1; changes in the Applicable Commitment Fee Margin resulting from a
change in the Net Debt to EBITDA Ratio and/or the EBITDA to Interest
Ratio, as the case may be, shall become effective upon delivery by the
Borrower to the Administrative Agent of a new Compliance Certificate
pursuant to clause (c) of Section 7.1.1. Notwithstanding the foregoing,
the Lenders acknowledge and agree that, subject to the next sentence, the
Applicable Commitment Fee Margin for the period from the Second Amendment
Effective Date through (but excluding) the date that the first Compliance
Certificate is delivered following the Second Amendment Effective Date
shall be determined by reference to level (c) above (notwithstanding the
actual Net Debt to EBITDA Ratio and EBITDA to Interest Ratio for such
period). If the Borrower shall fail to deliver a Compliance Certificate
within the number of days after the end of any Fiscal Quarter as required
pursuant to clause (c) of Section 7.1.1 (without giving effect to any
grace period), the Applicable Commitment Fee Margin from and including the
first day after the date on which such Compliance Certificate was required
to be delivered to but not including the date the Borrower delivers to the
Administrative Agent a Compliance Certificate shall conclusively equal the
highest Applicable Commitment Fee Margin set forth above.
"Applicable LIBO Rate Margin" means, with respect to any Loan made
or maintained as a LIBO Rate Loan, the lowest per annum rate determined by
reference to the Net Debt to EBITDA Ratio and EBITDA to Interest Ratio, in
each case that is satisfied for each of such ratios in a given clause
below and as indicated in the Compliance Certificate most recently
delivered pursuant to clause (c) of Section 7.1.1, equal to:
(a) 0.45% if the Net Debt to EBITDA Ratio is less than or
equal to 1.75:1 and the EBITDA to Interest Ratio is greater than or
equal to 5.0:1;
(b) 0.60% if the Net Debt to EBITDA Ratio is less than or
equal to 2.25:1 and the EBITDA to Interest Ratio is greater than or
equal to 3.75:1;
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(c) 0.75% if the Net Debt to EBITDA Ratio is less than or
equal to 2.75:1 and the EBITDA to Interest Ratio is greater than or
equal to 3.00:1; and
(d) 1.00% if the Net Debt to EBITDA Ratio is greater than
2.75:1 or the EBITDA to Interest Ratio is less than 3.00:1.
The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio used
to compute the Applicable LIBO Rate Margin shall be the Net Debt to EBITDA
Ratio and the EBITDA to Interest Ratio, as the case may be, set forth in
the Compliance Certificate most recently delivered by the Borrower to the
Administrative Agent pursuant to clause (c) of Section 7.1.1; changes in
the Applicable LIBO Rate Margin resulting from a change in the Net Debt to
EBITDA Ratio and/or the EBITDA to Interest Ratio, as the case may be,
shall become effective upon delivery by the Borrower to the Administrative
Agent of a new Compliance Certificate pursuant to clause (c) of Section
7.1.1. Notwithstanding the foregoing, the Lenders acknowledge and agree
that, subject to the next sentence, the Applicable LIBO Rate Margin for
the period from the Second Amendment Effective Date through (but
excluding) the date that the first Compliance Certificate is delivered
following the Second Amendment Effective Date shall be determined by
reference to level (c) above (notwithstanding the actual Net Debt to
EBITDA Ratio and EBITDA to Interest Ratio for such period). If the
Borrower shall fail to deliver a Compliance Certificate within the number
of days after the end of any Fiscal Quarter as required pursuant to clause
(c) of Section 7.1.1 (without giving effect to any grace period), the
Applicable LIBO Rate Margin from and including the first day after the
date on which such Compliance Certificate was required to be delivered to
but not including the date the Borrower delivers to the Administrative
Agent a Compliance Certificate shall conclusively equal the highest
Applicable LIBO Rate Margin set forth above.
"EBITDA" means, for any period, the sum for such period of all
amounts which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries as
(a) EBIT;
plus
(b) the amount deducted, in determining Net Income,
representing amortization;
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plus
(c) the amount deducted, in determining Net Income,
representing depreciation of assets.
"EBITDA to Interest Ratio" means, at the close of any Fiscal
Quarter, the ratio, computed for the period consisting of such Fiscal
Quarter and each of the three immediately preceding Fiscal Quarters, of
(a) EBITDA
to
(b) Interest Expense.
"Net Debt to EBITDA Ratio" means, at the last day of any Fiscal
Quarter, the ratio, computed (in the case of clause (b) below) for the
period consisting of such Fiscal Quarter and each of the three immediately
preceding Fiscal Quarters, of
(a) Debt minus the aggregate amount of cash and Cash
Equivalent Investments (not subject to any Lien or other
encumbrance) owned by the Borrower and its Subsidiaries on such last
day
to
(b) EBITDA.
"Second Amendment" means the Second Amendment, dated as of September
24, 1996, to this Agreement among the Borrower, the Lenders party thereto,
the Co-Agents and the Administrative Agent.
"Second Amendment Effective Date" means the Second Amendment
Effective Date as defined in Subpart 4.1 of the Second Amendment.
SUBPART 2.1.2. Section 1.1 of the Existing Credit Agreement is further
amended by amending the definition of "Loan Commitment Amount" appearing in such
Section in its entirety to read as follows:
"`Loan Commitment Amount' means, on any day, $50,000,000, as such
amount may be reduced from time to time pursuant to Section 2.2."
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SUBPART 2.2. Amendments to Article III. Article III of the Existing Credit
Agreement is hereby amended in accordance with Subparts 2.2.1 and 2.2.2.
SUBPART 2.2.1. Clause (ii) of Section 3.2.1 of the Existing Credit
Agreement is hereby amended in its entirety to read as follows:
"(ii) On that portion of such Borrowing maintained as LIBO Rate
Loans, during each Interest Period applicable thereto, such rate shall be
equal to the sum of the LIBO Rate (Reserve Adjusted) for such Interest
Period plus the Applicable LIBO Rate Margin; and"
SUBPART 2.2.2. Section 3.3.1 of the Existing Credit Agreement is hereby
amended by deleting the words "at the rate of 1/4 of 1% per annum" and inserting
the words "equal to the Applicable Commitment Fee Margin" in place thereof.
SUBPART 2.3. Amendments to Exhibits. Exhibit A-1 (Form of Revolving Note),
Exhibit A-2 (Form of Competitive Bid Loan Note) and Exhibit E (Compliance
Certificate) to the Existing Credit Agreement are hereby amended in their
entirety to read as respectively set forth on Exhibits A, B and C hereto.
SUBPART 2.4. Extension of Stated Maturity Date. By their signatures below,
the parties hereto hereby agree that, in accordance with the terms of Section
2.4 of the Existing Credit Agreement, effective on the Stated Maturity Date
under the Existing Credit Agreement, the Stated Maturity Date shall be extended
to September 24, 1997.
PART III
ACKNOWLEDGEMENT
SUBPART 3.1. Acknowledgement. By their signature below, each of the
Lenders acknowledges and agrees that as of the Second Amendment Effective Date
(and notwithstanding any reductions to the Loan Commitment Amount that have
occurred prior to the Second Amendment Effective Date) the Loan Commitment
Amount is $50,000,000, as such amount may be reduced from time to time after the
Second Amendment Effective Date pursuant to Section 2.2 of the Credit Agreement.
PART IV
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CONDITIONS TO EFFECTIVENESS
SUBPART 4.1. Second Amendment Effective Date. This Amendatory Agreement
shall become effective on the date first set forth above (the "Second Amendment
Effective Date") when each of the conditions set forth in this Subpart 4.1 shall
have been satisfied.
SUBPART 4.1.1. Execution of Counterparts. The Administrative Agent shall
have received counterparts of this Amendatory Agreement, duly executed on behalf
of the Borrower and each of the Lenders.
SUBPART 4.1.2. Resolutions, etc. The Administrative Agent shall have
received from the Borrower, with copies for each Lender, a certificate, dated
the Second Amendment Effective Date, of its Secretary or Assistant Secretary as
to
(a) resolutions of its Board of Directors, then in full force and
effect, authorizing the execution, delivery and performance of this
Amendatory Agreement and each other Loan Document to be executed by it in
connection with this Amendatory Agreement; and
(b) the incumbency and signatures of its officers authorized to
execute and deliver, and act with respect to, this Amendatory Agreement,
each other Loan Document and each of the other documents, certificates,
instruments and other agreements delivered or to be delivered by it
pursuant to this Amendatory Agreement and pursuant to the Credit
Agreement.
Each of the Lenders and the Agents may conclusively rely upon such certificate
until the Administrative Agent has received a further certificate of the
Secretary or an Assistant Secretary of the Borrower cancelling or amending such
prior certificate.
SUBPART 4.1.3. Fees and Expenses. The Administrative Agent shall have
received payment in full of all fees, costs and expenses due and payable as of
the Second Amendment Effective Date.
SECTION 4.1.4. Opinions of Counsel. The Administrative Agent shall have
received opinions, dated the Second Amendment Effective Date and addressed to
the Agents and all Lenders, from counsel to the Borrower, in form and substance
satisfactory to the Administrative Agent.
SUBPART 4.1.5. Delivery of Notes. The Administrative Agent shall have
received, for the account of each Lender, Notes, issued in substitution and
exchange for, and not in satisfaction
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of, the Notes delivered under the terms of the Existing Credit Agreement, duly
executed and delivered by the Borrower.
SUBPART 4.1.6. Legal Details, etc. All documents executed or submitted
pursuant hereto shall be satisfactory in form and substance to the
Administrative Agent and its counsel. The Administrative Agent and its counsel
shall have received all information and such counterpart originals or such
certified or other copies or such materials, as the Administrative Agent or its
counsel may reasonably request, and all legal matters incident to the
transactions contemplated by this Amendatory Agreement shall be satisfactory to
the Administrative Agent and its counsel.
PART V
MISCELLANEOUS
SUBPART 5.1. Cross-References. References in this Amendatory Agreement to
any Part or Subpart are, unless otherwise specified or otherwise required by the
context, to such Part or Subpart of this Amendatory Agreement.
SUBPART 5.2. Loan Document Pursuant to Existing Credit Agreement. This
Amendatory Agreement is a Loan Document executed pursuant to the Existing Credit
Agreement and shall be construed, administered and applied in accordance with
all of the terms and provisions of the Existing Credit Agreement.
SUBPART 5.3. Successors and Assigns. This Amendatory Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
SUBPART 5.4. Counterparts. This Amendatory Agreement may be executed by
the parties hereto in several counterparts, each of which when executed and
delivered shall be deemed to be an original and all of which shall constitute
together but one and the same agreement.
SUBPART 5.5. Representations, No Default, etc. As of the date of
effectiveness of this Amendatory Agreement, the Borrower hereby represents and
warrants to the Agents and the Lenders that
(a) the representations and warranties set forth in Article VI of
the Existing Credit Agreement (excluding, however, those contained in
Section 6.7 thereof) are true and correct in all material respects (unless
stated to relate solely to an earlier date, in which case such
representations and warranties were true and correct as of such earlier
date);
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(b) except as disclosed by the Borrower to the Administrative Agent
and the Lenders pursuant to Section 6.7 of the Existing Credit Agreement,
(i) no litigation, arbitration or governmental investigation
or proceeding is pending or, to the knowledge of the Borrower,
threatened against the Borrower or any of its Subsidiaries which may
reasonably be expected to materially adversely affect the
Borrower's, or the Borrower and its Subsidiaries' taken as a whole,
financial condition, operations, assets, businesses, properties or
prospects or which purports to affect the legality, validity or
enforceability of the Existing Credit Agreement, the Notes or any
other Loan Document; and
(ii) no development has occurred in any litigation,
arbitration or governmental investigation or proceeding disclosed
pursuant to Section 6.7 of the Existing Credit Agreement which may
reasonably be expected to materially adversely affect the financial
condition, operations, assets, businesses, properties or prospects
of the Borrower or the Borrower and its Subsidiaries, taken as a
whole; and
(c) no Default has occurred and is continuing.
SUBPART 5.6. Limited Waiver, etc. No amendment, waiver or approval by the
Agents or any Lender under this Amendatory Agreement shall, except as may be
otherwise stated in this Amendatory Agreement, be applicable to subsequent
transactions. No amendment, waiver or approval hereunder shall require any
similar or dissimilar amendment, waiver or approval to be granted after the date
hereof, and except as expressly modified by this Amendatory Agreement, the
provisions of the Existing Credit Agreement shall remain in full force and
effect, without amendment or other modification.
SUBPART 5.7. Governing Law. THIS AMENDATORY AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendatory
Agreement to be executed by their respective authorized officers as of the day
and year first above written.
HANDY & XXXXXX
By __________________________________
Title:
THE BANK OF NOVA SCOTIA,
in its capacity as Administrative
Agent, Co-Agent and Lender
By __________________________________
Title:
00
XXX XXXX XX XXX XXXX,
in its capacity as
Co-Agent and Lender
By __________________________________
Title:
00
XXX XXXXX XXXXXXXXX BANK (formerly known
as Chemical Bank), in its capacity as
Co-Agent and Lender
By __________________________________
Title:
13
FLEET PRECIOUS METALS INC.
By __________________________________
Title:
14
THE FIRST NATIONAL BANK OF CHICAGO
(formerly known as NBD Bank)
By __________________________________
Title:
15
BANK OF TOKYO - MITSUBISHI TRUST COMPANY
By __________________________________
Title:
16
LTCB TRUST COMPANY
By __________________________________
Title:
17
CREDIT LYONNAIS NEW YORK BRANCH
By __________________________________
Title:
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By __________________________________
Title:
18
THE SUMITOMO BANK, LIMITED
By __________________________________
Title:
By __________________________________
Title:
00
XXXXXXXX XXXX XX, XXX XXXX XXX/XX
XXXXXX XXXXXXX BRANCHES
By __________________________________
Title:
By __________________________________
Title:
00
XXX XXXX XXXX, XXXXXXX,
XXX XXXX BRANCH
By __________________________________
Title:
21
ABN AMRO BANK N.V. NEW YORK BRANCH
By __________________________________
Title:
By __________________________________
Title:
22
BANQUE PARIBAS
By __________________________________
Title:
By __________________________________
Title:
23
GIROCREDIT BANK AG DER SPARKESSEN
GRAND CAYMAN ISLAND BRANCH
By __________________________________
Title:
By __________________________________
Title:
24
COMERICA BANK
By __________________________________
Title:
25
IBJ XXXXXXXX BANK & TRUST COMPANY
By __________________________________
Title:
26
YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By __________________________________
Title:
27
EXHIBIT A
TO SECOND AMENDMENT
EXHIBIT A-1
Revolving Loan Note
$______________ September 28, 1994
FOR VALUE RECEIVED, the undersigned, HANDY & XXXXXX, a New York
corporation (the "Borrower"), promises to pay to the order of
_________________________ (the "Lender") on the Stated Maturity Date (as such
term is defined in the Credit Agreement referred to below), the principal sum of
_______________ DOLLARS ($___________) or, if less, the aggregate unpaid
principal amount of all Revolving Loans (as such term is defined in the Short
Term Revolving Credit Agreement, dated as of the date hereof (as such Short Term
Revolving Credit Agreement may be amended, supplemented, amended and restated or
otherwise modified from time to time, the "Credit Agreement"), among the
Borrower, The Bank of Nova Scotia, The Chase Manhattan Bank (formerly known as
Chemical Bank) and The Bank of New York, as Co-Agents, The Bank of Nova Scotia,
as Administrative Agent and certain financial institutions (including the
Lender) as are, or may become, parties thereto), made by the Lender pursuant to
the Credit Agreement. A notation indicating all Revolving Loans made by the
Lender pursuant to the Credit Agreement and payments on account of principal of
such Revolving Loans may, from time to time, be made by the holder hereof on the
grid attached to this Revolving Loan Note. Unless otherwise defined herein or
the context otherwise requires, terms used herein have the meanings provided in
the Credit Agreement.
The unpaid principal amount of this Revolving Loan Note from time to time
outstanding shall bear interest as provided in Section 3.2.1 of the Credit
Agreement. All payments of principal of and interest on this Revolving Loan Note
shall be payable in lawful currency of the United States of America to the
account designated by the Administrative Agent in same day funds.
This Revolving Loan Note represents a renewal of, and is issued in
substitution and exchange for, and not in satisfaction of, that certain
Revolving Loan Note of the Borrower, dated September 28, 1994, payable to the
order of the Lender (or its assignor). The Indebtedness originally evidenced by
such promissory note is a continuing Indebtedness, and nothing herein contained
shall be construed to deem such promissory note paid.
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This Revolving Loan Note is one of the Revolving Loan Notes referred to
in, and evidences indebtedness incurred in respect of the Revolving Loans under,
the Credit Agreement, to which reference is made for a statement of the terms
and conditions on which the Borrower is permitted and required to make
prepayments of principal of the indebtedness evidenced by this Revolving Loan
Note and on which such indebtedness may be declared to be or may become
immediately due and payable.
THIS REVOLVING LOAN NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK, AND
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK.
HANDY & XXXXXX
By_________________________
Title:
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GRID
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Last Day of Amount of Outstanding
Alternate Base Applicable Principal Principal Notation Made
Date Amount of Loan Rate LIBO Rate Interest Period Payment Balance By
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EXHIBIT B
TO SECOND AMENDMENT
EXHIBIT A-2
Competitive Bid Loan Note
$50,000,000 September 28, 1994
FOR VALUE RECEIVED, the undersigned, HANDY & XXXXXX, a New York
corporation (the "Borrower"), promises to pay to the order of
_______________________ (the "Lender") on the earlier of (i) each Competitive
Bid Loan Maturity Date (as such term is defined in that certain Short Term
Revolving Credit Agreement, dated as of the date hereof (as such Short Term
Revolving Credit Agreement may be amended, supplemented, amended and restated or
otherwise modified from time to time, the "Credit Agreement"), among the
Borrower, The Bank of Nova Scotia, The Chase Manhattan Bank (formerly known as
Chemical Bank) and The Bank of New York, as Co-Agents, The Bank of Nova Scotia,
as Administrative Agent and certain financial institutions (including the
Lender) as are, or may from time to time become parties thereto), and (ii) the
Loan Commitment Termination Date (as defined in the Credit Agreement), the
principal sum of FIFTY MILLION DOLLARS ($50,000,000) or, if less, the unpaid
principal amount of all Competitive Bid Loans made by the Lender to the Borrower
from time to time pursuant to Section 2.4. of the Credit Agreement. A notation
indicating all Competitive Bid Loans made by the Lender pursuant to the Credit
Agreement and all payments on account of principal of such Competitive Bid Loans
may, from time to time, be made by the holder hereof on the grid attached to
this Competitive Bid Loan Note.
The unpaid principal amount of this Competitive Bid Loan Note from time to
time outstanding shall bear interest as provided in Section 3.2.1 of the Credit
Agreement. All payments of principal of and interest on this Competitive Bid
Loan Note shall be payable in lawful currency of the United States of America to
the account designated by the Administrative Agent in same day funds.
This Competitive Bid Loan Note represents a renewal of, and is issued in
substitution and exchange for, and not in satisfaction of, that certain
Competitive Bid Loan Note of the Borrower, dated September 28, 1994, payable to
the order of the Lender (or its assignor). The indebtedness originally evidenced
by such promissory note is a continuing indebtedness, and nothing herein
contained shall be construed to deem such promissory note paid.
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This Competitive Bid Loan Note is one of the Competitive Bid Loan Notes
referred to in, and evidences indebtedness incurred in respect of Competitive
Bid Loans under, the Credit Agreement, to which reference is made for a
statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments of principal of the indebtedness evidenced by this
Competitive Bid Loan Note and on which such indebtedness may be or may become
declared to be immediately due and payable. Unless otherwise defined herein or
the context otherwise requires, terms used herein have the meanings provided in
the Credit Agreement.
THIS COMPETITIVE BID LOAN NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK
AND SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK.
HANDY & XXXXXX
By________________________
Title:
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GRID
====================================================================================================================================
Competitive Bid Amount of
Amount of Loan Maturity Amount of Principal Outstanding
Date Loan Date Interest Period Interest Payment Payment Principal Balance Notation Made By
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EXHIBIT C
TO SECOND AMENDMENT
EXHIBIT E
Form of Compliance Certificate
To: Each of the Lenders
(as defined below)
-and-
The Bank of Nova Scotia,
as Administrative Agent
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: ______________
Handy & Xxxxxx
Gentlemen:
This Compliance Certificate is being delivered pursuant to clause (c) of
Section 7.1.1 of the Short Term Revolving Credit Agreement, dated as of
September 28, 1994 (as amended, supplemented, amended and restated or otherwise
modified, the "Credit Agreement"), among Handy & Xxxxxx, a New York corporation
(the "Borrower"), certain financial institutions now or hereafter parties
thereto (the "Lenders"), The Bank of Nova Scotia, The Chase Manhattan Bank
(formerly known as Chemical Bank) and The Bank of New York, as Co-Agents for the
Lenders and The Bank of Nova Scotia, as Administrative Agent. Terms used herein
without definition shall have the meanings assigned to such terms in Section 1.1
of the Credit Agreement.
The Borrower hereby certifies, represents and warrants that as of
_________ __, 19__ (the "Computation Date"):
(a) The Adjusted Consolidated Tangible Net Worth was $__________, as
computed on Attachment 1 hereto and such amount [complies] [does not comply]
with the provisions of clause (a) of Section 7.2.4 of the Credit Agreement;
(b) The Leverage Ratio was __:1.00, as computed on Attachment 2 hereto and
such ratio [complies] [does not comply] with the provisions of clause (b) of
Section 7.2.4 of the Credit Agreement;
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(c) The Interest Coverage Ratio was __:1.00, as computed on Attachment 3
hereto and such ratio [complies] [does not comply] with the provisions of clause
(c) of Section 7.2.4 of the Credit Agreement;
(d) The Net Debt to EBITDA Ratio was __:1.00 and the EBITDA to Interest
Ratio was __:1.00, as computed on Attachment 4 hereto;
(e) The aggregate amount of Designated Debt of the Borrower and its
Subsidiaries was $_________ as computed on Attachment 5 hereto and such amount
[complies] [does not comply] with clause (a) of Section 7.2.2 of the Credit
Agreement;
(f) The aggregate amount of Debt of all Subsidiaries was $_________, and
such amount [complies] [does not comply] with clause (b) of Section 7.2.2 of the
Credit Agreement;
(g) The aggregate face amount of Indebtedness in respect of letters of
credit (other than Letters of Credit) was $________, and such amount [complies]
[does not comply] with clause (a)(ii)(B) of Section 7.2.2 of the Credit
Agreement;
(h) The aggregate amount of Investments (other than the Investments
permitted by clauses (a) through (f) of Section 7.2.5 of the Credit Agreement)
made, incurred, assumed or otherwise existing by the Borrower and its
Subsidiaries was $_________ and such amount [complies] [does not comply] with
clause (g) of Section 7.2.5 of the Credit Agreement;
(i) The aggregate amount of rental obligations entered into by the
Borrower and its Subsidiaries of the type set forth in Section 7.2.8 of the
Credit Agreement was $_________ and such amount [complies] [does not comply]
with Section 7.2.8 of the Credit Agreement;
(j) The aggregate book value or market value, if higher (determined as to
particular assets as of the respective date of disposition thereof) (other than
in accordance with clauses (a), (b) and (c) of Section 7.2.11 of the Credit
Agreement) of all assets sold, transferred, leased, contributed or otherwise
conveyed by the Borrower and its Subsidiaries (i) since the Effective Date was
$__________ and such amount [complies] [does not comply] with clause (d)(i) of
Section 7.2.11 of the Credit Agreement, and (ii) constitutes assets which
contributed __% of operating profit contribution during the three most recently
completed Fiscal Years of the Borrower, and such amount [complies][does not
comply] with clause (d)(ii) of Section 7.2.11 of the Credit Agreement;
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35
(k) No Default has occurred and is continuing [other than as follows:];
(l) The total market value of precious metal held on consignment by the
Borrower and its Subsidiaries was $_________;
(m) The total number of ounces of precious metal held on consignment at
each Plant (as defined in the Consignment Facilities) under the terms of the
Consignment Facilities was ____________; and
(n) The total number of ounces of U.S. Bullion (as defined in the
Consignment Facilities) located at each Plant was __________.
(o) Based on paragraph (d) above, the Applicable LIBO Rate Margin is ___%
and the Applicable Commitment Fee Margin is ___%.
IN WITNESS WHEREOF, the Borrower has caused this Compliance Certificate to
be executed and delivered by its duly Authorized Officer on this ____ day of
_________, 19__.
HANDY & XXXXXX
By_________________________
Title:
-3-
36
ATTACHMENT 1
(to __/__/__ Compliance
Certificate)
ADJUSTED CONSOLIDATED TANGIBLE NET WORTH
(________ __, 19__)
1. Adjusted Consolidated
Tangible Net Worth:
A. The par value (or value stated on
the books of the Borrower) of the
capital stock of all classes of the
Borrower................................................$_________
B. The amount of the consolidated
surplus, whether capital or earned,
of the Borrower and its
and its Subsidiaries................................... $_________
C. The sum (or difference, in the
case of a surplus deficit in
Item 1.B) of Items 1.A and 1.B......................... $_________
D. The aggregate amount of treasury
stock, subscribed but unissued
stock, unamortized debt discount
and expense, good will,
trademarks, trade names, patents
and other intangible assets (but
not deferred charges) of the
Borrower and its Subsidiaries ......................... $_________
E. The aggregate amount of all write-
ups in the book value of any assets
owned by the Borrower or its
Subsidiaries subsequent to March
16, 1992, other than write-ups of
assets (and assets of Subsidiaries)
acquired by the Borrower and/or its
Subsidiaries (exclusive of
goodwill) that are made in
connection with
the acquisition thereof.................................$_________
F. Sum of Items 1.D through 1.E $_________
37
G. Consolidated Tangible Net Worth:
The excess of Item 1.C over Item 1.F................... $_________
H. 40% of the excess of the Market
Value of the Borrower's and its
Subsidiaries' owned precious metal
holdings over the LIFO cost of such
holdings as set forth in the
Borrower's most recent consolidated
financial statements delivered
pursuant to clause (a) or clause
(b) of Section 7.1.1 of the
Credit Agreement....................................... $_________
I. ADJUSTED CONSOLIDATED TANGIBLE NET WORTH:
The sum of Items 1.G and 1.H............................$_________
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38
ATTACHMENT 2
(to __/__/__ Compliance
Certificate)
LEVERAGE RATIO
(on ___________ __, 19__)
2. (1)Leverage Ratio:
A. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries for
borrowed money and all other
obligations evidenced by bonds,
debentures, notes or other
similar instruments..................................... $_________
B. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries
(without duplication of the
obligations set forth in Item 2.A of
this Attachment 2), whether
contingent or otherwise, relative to
banker's acceptances issued for the
account of the Borrower and its
Subsidiaries ............................................$_________
C. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries as
lessee under leases which have been
or should be, in accordance with
GAAP, recorded as
Capitalized Lease Liabilities........................... $_________
D. Without duplication, Contingent
Liabilities of the Borrower and its
Subsidiaries in respect of any types
of Indebtedness described in
Items 2.A through 2.C .................................. $_________
----------
(1) Computed in accordance with the final sentence contained in the definition
of "Indebtedness".
00
X. Xxxx: The Sum of Items 2.A through 2.D................. $_________
F. Adjusted Consolidated Tangible
Net Worth (from Attachment 1,
Item 1.I)............................................... $_________
G. LEVERAGE RATIO: The ratio
of Item 2.E to Item 2.F.................................. ____:1.00
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40
ATTACHMENT 3
(to __/__/__ Compliance
Certificate)
INTEREST COVERAGE RATIO
(on __/__/19__)
3. Interest Coverage Ratio:
*A. The consolidated net income of
the Borrower and its Subsidiaries
(excluding any extraordinary gains
and losses)........................................ $__________
*B. The aggregate amount of interest
expense of the Borrower and its
Subsidiaries, including the portion
of any rent paid on Capital Lease
Liabilities which is allocable to
interest expense in accordance with
GAAP and including fees or rents
arising from or relating to
consignment or leasing of precious
metals other than up-front fees paid
on the Effective Date to the Lenders
(provided, that any such interest
expense which is subject to a
Hedging Obligation will be
calculated on the net effect of any
payments made by the other party to
such Hedging Obligation)........................... $__________
*C. To the extent deducted in
determining Net Income,
provisions for income taxes........................ $__________
D. EBIT: The sum of Items 3.A
through 3.C........................................ $__________
E. Interest Expense: The amount set forth in Item 3.B above minus the
effects of the non-recurring, pre-tax charges in an aggregate amount
not to exceed $9,500,000 relating to the Borrower's discontinuance
of its karat gold fabricating product
----------
* The amount which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries.
41
line in East Providence, Rhode Island and additional
costs primarily related to that division's ongoing
operation in Fairfield, Connecticut.....................$__________
F. INTEREST COVERAGE RATIO: The ratio
of Item 3.D to Item 3.E............................ _____:1.00
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42
ATTACHMENT 4
(to __/__/__ Compliance
Certificate)
NET DEBT TO EBITDA RATIO
EBITDA TO INTEREST RATIO (on __/__/19__)
4. I. Net Debt to EBITDA Ratio:
A. Debt: Item 2.E from Attachment 2................... $__________
B. The aggregate amount of cash and
Cash Equivalent Investments (not
subject to any Lien or other
encumbrance) owned by the Borrower
and its Subsidiaries on the last day
of the applicable Fiscal Quarter................... $__________
C. Net Debt: Item 4.A minus Item 4.B................. $__________
*D. EBIT: Item 3.D from Attachment 3................... $__________
*E. To the extent deducted in
determining Net Income,
provisions for depreciation of assets.............. $__________
*F. To the extent deducted in
determining Net Income,
provisions for amortization........................ $__________
G. EBITDA: The sum of Items 4.D
through 4.F........................................ $__________
H. NET DEBT TO EBITDA RATIO: The ratio
of Item 4.C to Item 4.G............................ ____:1.00
II. EBITDA to Interest Ratio:
I. EBITDA: Item 4.G above............................ $__________
J. Interest Expense: Item 3.E........................ $__________
K. EBITDA TO INTEREST RATIO: The ratio of
Item 4.I to Item 4.J............................... ____:1.00
----------
* The amount which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries.
43
ATTACHMENT 5
(to __/__/__ Compliance
Certificate)
DESIGNATED DEBT
(as of _________ __, 19__)
5. Designated Debt:
A. Current Debt: The aggregate amount
of current maturities of the
consolidated Debt of the Borrower
and its Subsidiaries, determined in
accordance with GAAP............................... $_________
B. The sum of the aggregate outstanding
principal amount of all Loans plus
Letter of Credit Outstandings (as
such terms are defined in the Long
Term Credit Agreement)............................. $_________
C. The sum of Item 5.A and Item 5.B................... $_________
D. 90% of the Market Value of the gold,
silver and platinum group metals and
the gold, silver and platinum group
metals' content of alloys then owned
by the Borrower and its Subsidiaries
in inventory and not held in
consignment........................................ $_________
E. 75% of the Eligible Receivables of
the Borrower and its Subsidiaries as
computed on Attachment 6 hereto.................... $_________
F. The aggregate amount of cash and
Cash Equivalent Investments of the
Borrower and its Subsidiaries, but
only to the extent that such cash
and Cash Equivalent Investments are
not subject to any Lien and (if held
or owned by a Subsidiary) are
transferable to the Borrower without
the consent or approval of any
other Person....................................... $_________
44
G. The sum of Items 5.D through 5.F................... $_________
H. The excess of Item 5.C over Item 5.G............... $__________
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45
ATTACHMENT 6
(to __/__/__ Compliance
Certificate)
ELIGIBLE RECEIVABLES
(as of _________ __, 19__)
6. Eligible Receivables:
A. Without duplication, the aggregate
amount of Receivables of the
Borrower and its Subsidiaries...................... $_________
B. The amount of such Receivables
lawfully owned by the Borrower or
such Subsidiary which is not free
and clear of Liens (other than Liens
permitted under Section 7.2.3 of the
Credit Agreement).................................. $_________
C. The amount of such Receivables which
is not valid, binding and legally
enforceable obligations of the
obligor under such Receivable...................... $_________
D. The amount of such Receivables which
is subject to any dispute, setoff,
counterclaim or other claim or
defense on the part of the obligor
thereunder, or which is subject to
any obligor denying liability under
such Receivable in whole or in part................ $_________
E. The amount of such Receivables which
is not a bona fide Receivable
arising from the sale (on an
absolute, and not a consignment,
approval, or sale-and-return-
basis (subject to the terms of
the parenthetical in clause (d) of
the definition of "Eligible Receivable"
contained in the Credit Agreement))................ $_________
F. The amount of such Receivables which
is payable more than 90 days after
the shipping of goods giving rise to
such Receivable, or is more than
60 days past due................................... $_________
46
G. The amount of such Receivables
which have been written off or
reserved against................................... $_________
H. The amount of such Receivables which
is the obligation of an obligor that
is either an Affiliate of the
Borrower, or the subject of any
reorganization, bankruptcy,
receivership, custodianship,
insolvency or like proceeding or any
event of the nature set forth in
clauses (a) through (d) of Section
8.1.9 of the Credit Agreement...................... $_________
I. The sum of Items 6.B through 6.H................... $_________
J. Item 6.A minus Item 6.I............................ $_________
K. 75% of the amount of the GO/XXX
Receivable ...................................... $_________
L. ELIGIBLE RECEIVABLES: Item 6.J plus
Item 6.K ...................................... $_________
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