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EXHIBIT 10-LLL(1)
FIRST AMENDMENT TO CREDIT AGREEMENT
This First Amendment to Credit Agreement ("First Amendment") is effective
as of September 1, 1998 between MEMC ELECTRONIC MATERIALS, INC., a Delaware
corporation ("Borrower"), as the Borrower, and Xxxx Corporation, a company
formed under the laws of the State of Delaware, U.S.A. ("Xxxx"), as the sole
Lender and as Agent.
Recitals
WHEREAS, Borrower and Xxxx entered into a Credit Agreement dated as of June
26, 1997 (the "Credit Agreement") pursuant to which Xxxx agreed to extend up to
US$50,000,000 of credit to Borrower on a term basis;
WHEREAS, Borrower, Xxxx and certain affiliates of Xxxx have agreed to
extend additional credit to Borrower and to restructure the existing financing
provided by Xxxx and its affiliates to Borrower, and
WHEREAS, as part of such restructuring, Borrower and Xxxx desire to change
the interest rate payable by Borrower to Xxxx under the Credit Agreement.
NOW THEREFORE, in consideration of the foregoing premises and the mutual
covenants and conditions hereinafter set forth, the parties agree as follows:
1. The definitions of "Applicable Margin", "Base Rate", "Performance
Level", "Performance Xxxxx X", "Xxxxxxxxxxx Xxxxx XX", "Xxxxxxxxxxx Xxxxx XXX"
and "Performance Level IV" in Section 1.01 of the Credit Agreement are hereby
deleted in their entirety.
2. The following definitions are hereby inserted in proper alphabetical
order into Section 1.01 of the Credit Agreement:
"Applicable Spread" means a percentage per annum equal to the excess
of (a) the Bloomberg fair market sector curves (adjusted for the chosen
interest rate method) applicable two business days prior to the Initial
Maturity Date to a B3 rated industrial borrower for the period from the
Initial Maturity Date through the latest possible Final Maturity Date
(taking into account, if applicable, the latest Extension Maturity Date)
over (b) the corresponding Swap Rate for such period.
"Extension Certificate" has the meaning specified in Section 2.15.
"Extension Period Interest Rate" means two business days prior to the
Initial Maturity Date, (a) either the British Bankers' Association (BBA)
LIBOR rate (as shown on the Reuters page FRBD or comparable pages) for the
12-month period or the Swap Rate for the 24-month period or the 36-month
period commencing from the Initial Maturity Date as follows: (i) the
36-month period for Advances subject to an Initial Maturity Date on or
prior to December 31, 1998, (ii) the 24-month period for Advances subject
to an Initial Maturity Date on or prior to December 31, 1999, or (iii) the
12-month period for all other Advances, plus (b) the Applicable Spread.
"Extension Request Notice" has the meaning set forth in Section 2.15.
"Extension Maturity Date", if any, means the earlier of (a) either (i)
the first anniversary of the Initial Maturity Date, or (ii) if there has
been an earlier applicable Extension Maturity Date on or prior to December
31, 1999, the first anniversary of such prior Extension Maturity Date, or
(iii) if there has been an earlier applicable Extension Maturity Date after
December 31, 1999 and on or before December 31, 2000, the first anniversary
of such prior Extension Maturity Date and (b) the termination in whole of
the Commitments pursuant to Section 2.04 or Section 6.01; provided, that in
no event shall an Extension Maturity Date be after December 31, 2001.
"Initial Maturity Date" for any Advance means June 25, 2004.
"Replacement Financing Arrangement" means a financing arrangement with
any Person who is not an Affiliate of the Borrower or the Agent or any
Lender on substantially the terms which would apply hereunder during the
period from the then applicable Final Maturity Date to the latest possible
Extension Maturity Date, provided that the interest rate of such
Replacement Financing Arrangement shall be no higher than the Extension
Period Interest Rate and, if no lesser interest rate is available, shall be
the Extension Period Interest Rate.
"Swap Rate" means the US-Dollar denominated interbank interest rate
swap rates/LIBOR offered rates as shown on Reuters page ICAP and other
comparable brokerage pages, adjusted for the chosen interest rate method
(annual/semi-annual compounding, etc.).
3. The definition of "Change of Control Date" in Section 1.01 of the Credit
Agreement is hereby deleted in its entirety and the following is substituted in
lieu thereof:
"Change of Control Date" means the date of occurrence of a Change of
Control; provided, that if such occurrence is on or prior to January 1,
2001, the occurrence shall be deemed to have occurred on January 1, 2001.
4. The definition of "Eligible Assignee" in Section 1.01 of the Credit
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Agreement is hereby deleted in its entirety and the following is substituted in
lieu thereof:
"Eligible Assignee" means any Person approved by all of the Lenders;
provided, however, that neither the Borrower nor any Subsidiary of the
Borrower shall qualify as an Eligible Assignee.
5. The definition of "Final Maturity Date" set forth in Section 1.01 of the
Credit Agreement is hereby deleted in its entirety and the following is
substituted in lieu thereof:
"Final Maturity Date" means the earlier of (a) either the Initial
Maturity Date or, if applicable, the Extension Maturity Date and (b) the
termination in whole of the Commitments pursuant to Section 2.04 or Section
6.01.
6. Section 2.03 of the Credit Agreement shall be amended as follows: in the
fifth line, "1/8 of 1%" is hereby deleted and "1/4 of 1%" is substituted in lieu
thereof.
7. Section 2.06(a) of the Credit Agreement is hereby deleted in its
entirety and the following is substituted in lieu thereof:
"(a) Interest on the Advances. From September 1, 1998, until such
principal amount shall be paid in full, the Borrower shall pay interest on
the unpaid principal amount of the Advances, if any, which interest shall
be payable semiannually on each June 15th and December 15th, at an interest
rate per annum equal to the applicable rate for each Advance as listed on
Schedule A hereto under the heading "Interest Rate"; provided, however,
that, if the Initial Maturity Date is on or after January 1, 2001, as of
the date occurring 45 Business Days after the Change of Control Date, the
interest rate per annum shall be the higher of (x) the applicable rate for
each Advance as listed on Schedule A hereto under the heading "Interest
Rate" and (y) the rate determined under clause (a) of the definition of
Extension Period Interest Rate, determined as of the Change of Control Date
(rather than the Initial Maturity Date), plus the Applicable Spread;
provided, that in the event of an extension of the then applicable Final
Maturity Date to the Extension Maturity Date pursuant to Section 2.15
hereto, from the then applicable Final Maturity Date to the Extension
Maturity Date, the interest rate per annum shall be equal to the Extension
Period Interest Rate."
8. Section 2.07 (Interest Rate Determination Upon Change of Control) is
hereby deleted in its entirety and the following is substituted in lieu thereof:
"SECTION 2.07. RESERVED."
9. The following Section 2.15 is hereby added at the end of Article II of
the Credit Agreement:
"SECTION 2.15. Extension. If the then applicable Final Maturity Date
is a date on or before December 31, 2000 and the Borrower may desire that
the Lenders extend the then applicable Final Maturity Date to the Extension
Maturity Date, then (a) the Borrower shall give written notice of said fact
(the "Extension Request Notice") to the Agent and the Lenders no later than
four (4) months before the Final Maturity Date, (b) the Borrower shall use
its best efforts to obtain and enter into on or before the date which is
two months prior to the Final Maturity Date a Replacement Financing
Arrangement and (c) if the Borrower shall not have entered into a
Replacement Financing Arrangement on or before the date which is two months
prior to the Final Maturity Date, the Borrower shall deliver to the Agent
and the Lenders a certificate of the Borrower (the "Extension Certificate")
(x) certifying that the Borrower has not entered into a Replacement
Financing Arrangement, but the Borrower used its best efforts to do so as
required by clause (b) and setting forth such evidence and back-up detail
as necessary to demonstrate the efforts made, including a written letter
from each bank from which a Replacement Financing Arrangement as required
by clause (b) was requested, indicating that Borrower made such a request
and that the request was denied, and (y) requesting that the Final Maturity
Date be extended to the Extension Maturity Date. For purposes of this
Section, the Borrower shall be deemed to have complied with the requirement
to use its "best efforts" by requesting from and, if applicable, diligently
negotiating a Replacement Financing Arrangement as required by clause (b)
with each of three (3) commercial banks that are nationally recognized in
the United States and each have total assets in excess of $20,000,000,000.
The Agent shall have the right to designate, within ten (10) Business Days
after receipt of an Extension Request Notice, one of the three banks
referred to in the preceding sentence. For purposes of this Section,
diligent negotiation shall mean negotiation in good faith and without
denial or unreasonable delay of any reasonable request by any such bank for
information in connection with its consideration of providing a Replacement
Financing Arrangement to Borrower. For the avoidance of doubt, nothing
herein is intended to prevent Borrower from obtaining a Replacement
Financing Arrangement on terms equal to or better than those provided
hereunder.
Following receipt of the Extension Certificate, the Agent and/or the
Lenders shall have the right (without any obligation to do so) to obtain
for the Borrower a Replacement Financing Arrangement on terms equal to or
better than those provided hereunder.
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If the Borrower has (a) delivered the Extension Request Notice within
the time period specified above, (b) used its best efforts to obtain and
enter into a Replacement Financing Arrangement and delivered the Extension
Certificate within the time period specified above and (c) not unreasonably
or in bad faith refused to enter into a Replacement Financing Arrangement
(with terms equal to or better than those provided hereunder) obtained for
the Borrower by the Agent or any of the Lenders pursuant to the preceding
paragraph, the Final Maturity Date shall be extended to the Extension
Maturity Date and the interest rate shall be the Extension Period Interest
Rate. The Agent shall provide the Borrower with a written notice setting
forth the Extension Period Interest Rate.
The Borrower shall be responsible for the payment of any customary
commitment fee and other fees in connection with obtaining a Replacement
Financing Arrangement.
For the avoidance of doubt, in no event shall an Extension Maturity
Date be requested by the Borrower after December 31, 2000 or be on a date
after December 31, 2001."
10. Section 5.02 of the Credit Agreement is deleted in its entirety and the
following is substituted in lieu thereof:
"SECTION 5.02. Negative Covenants. On and after September 1, 1998 and
so long as any Advance shall remain unpaid or any Lender shall have any
Commitment hereunder, the Borrower will not, unless the Lenders shall
otherwise consent in writing:
(a) Liens, etc. Create or suffer to exist, or permit any of its
Subsidiaries to create or suffer to exist, any lien, security interest
or other charge or encumbrance, or any other type of preferential
arrangement, upon or with respect to any of its properties, whether
now owned or hereafter acquired, or assign, or permit any of its
Subsidiaries to assign, any right to receive income, in each case to
secure any Debt of any Person, other than:
(i) purchase money liens or purchase money security
interests upon or in any property acquired or held by the
Borrower or any Subsidiary in the ordinary course of business to
secure the purchase price of such property or to secure
indebtedness incurred solely for the purpose of financing the
acquisition of such property;
(ii) liens or security interests existing on such property
at the time of its acquisition (other than any such lien or
security interest created in contemplation of such acquisition);
(iii) liens for taxes, assessments and government charges or
levies to the extent not required to be paid under Section
5.01(b) hereof;
(iv) liens imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's liens and other
similar liens arising in the ordinary course of business securing
obligations that are not overdue for a period of more than 30
days;
(v) pledges or deposits to secure obligations under workers'
compensation laws or similar legislation or to secure public or
statutory obligations;
(vi) easements, rights of way and other encumbrances on
title to real property that do not render title to the property
encumbered thereby unmarketable or materially adversely affect
the use of such property for its present purposes; and
(vii) liens incurred or deposits made in the ordinary course
of business to secure the performance of letters of credit, bids,
tenders, sales contracts, leases, surety, appeal and performance
bonds and other similar obligations not incurred in connection
with the borrowing of money;
provided, that the aggregate principal amount of the Debt, other
indebtedness, taxes, assessments, governmental charges or levies or
other obligations secured by the liens or security interests referred
to in clauses (i) through (vii) of this Section 5.02(a) shall not
exceed $45,000,000 in the aggregate at any time outstanding.
(b) Accounting Changes. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in accounting policies or
reporting practices, except as allowed by generally accepted
accounting principles."
11. Unless otherwise provided herein, any term in initial capital letters
or all capital letters used as a defined term but not defined in this First
Amendment shall have the meaning set forth in the Credit Agreement.
12. Except as modified herein, all terms and conditions of the Credit
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Agreement shall remain in full force and effect.
13. This First Amendment shall be governed by, and construed in accordance
with, the laws of the State of New York.
14. This First Amendment 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 an original and all of which taken together shall
constitute one and the same agreement. Delivery of any executed counterpart of a
signature page to this First Amendment by telecopier shall be effective as
delivery of a manually executed counterpart of this First Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
be executed by their duly authorized representatives effective as of the day and
year first above written.
MEMC ELECTRONIC MATERIALS, INC., as Borrower
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
Title: Treasurer
XXXX CORPORATION, as Agent
By: /s/ X. X. Xxxxxxxxx
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Name: X. X. Xxxxxxxxx
Title: President and CEO
By: /s/ Xxxx Xxxxxxxxx
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Name: Xxxx Xxxxxxxxx for Xxxxxxxx Xxxxxxxxxx
Title: Treasurer
XXXX CORPORATION, as the sole Lender
By: /s/ X. X. Xxxxxxxxx
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Name: X. X. Xxxxxxxxx
Title: President and CEO
By: /s/ Xxxx Xxxxxxxxx
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Name: Xxxx Xxxxxxxxx for Xxxxxxxx Xxxxxxxxxx
Title: Treasurer
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Schedule A
to
First Amendment to Credit Agreement
New Interest Rates per Advance
(effective September 1, 1998)
Advance Date Advance Amount Interest Rate
____________ ______________ _____________
5 December 1997 $25,000,000 9.124%
22 January 1998 25,000,000 8.761%
