EXHIBIT 10.31 - WAIVER AND FIRST AMENDMENT TO CREDIT AGREEMENT
THIS WAIVER AND FIRST AMENDMENT TO CREDIT AGREEMENT (this
"Waiver and First Amendment") is dated as of the 12th day of
November, 1997 among XXXXXXXXX TECHNOLOGIES, INC. (the
"Borrower"), WACHOVIA BANK, N.A., as Agent (the "Agent") and
WACHOVIA BANK, N.A.; BANK OF AMERICA; BANK OF TOKYO-MITSUBISHI,
LTD., CHICAGO BRANCH; THE SAKURA BANK, LIMITED; XXXXXX BANK; THE
FIRST NATIONAL BANK OF CHICAGO; THE NORTHERN TRUST COMPANY;
MELLON BANK, N.A.; and XXXXXX BANK LTD, NEW YORK BRANCH,
(collectively, the "Banks");
W I T N E S S E T H:
WHEREAS, the Borrower, the Agent and the Banks executed and
delivered that certain Credit Agreement, dated as of July 30,
1997 (as amended, the "Credit Agreement");
WHEREAS, the Borrower has requested certain waivers under
and amendments to the Credit Agreement and the Agent and the
Banks are willing to agree to the Borrower's requests, subject to
the terms and conditions of this Waiver and First Amendment;
NOW, THEREFORE, for and in consideration of the above
premises and other good and valuable consideration, the receipt
and sufficiency of which hereby is acknowledged by the parties
hereto, the Borrower, the Agent and the Banks hereby covenant and
agree as follows:
1. Definitions. Unless otherwise specifically defined
herein, each term used herein which is defined in the Credit
Agreement has the meaning assigned to such term in the Credit
Agreement. Each reference to "hereof", "hereunder", "herein" and
"hereby" and each other similar reference and each reference to
"this Agreement" and each other similar reference contained in
the Credit Agreement from and after the date hereof refer to the
Credit Agreement as amended hereby.
2. Amendment to Section 1.01. The following new definition
is hereby added to Section 1.01 of the Credit Agreement:
"MTL/MTOy Acquisition" means those certain transactions
described in that certain memorandum from Xxxxxx Xxxxxxx-
Xxxxxxxxx to representatives of the Agent dated November 4,
1997, a copy of which has been delivered to the Agent and
the Banks.
3. Amendments to Section 4.08. Section 4.08 of the Credit
Agreement is hereby amended by deleting the term "XxXxxxxxx
Technological Sales Corporation" therein and substituting
therefor the term "XxXxxxxxx International Sales Corporation."
4. Amendment to Section 5.07. Section 5.07 of the Credit
Agreement hereby is amended by: (A) deleting the word "and"
immediately before clause (iv) therein; (B) deleting the text
"provided that after giving effect to the making of any loans,
advances or deposits permitted by this Section, the Borrower will
be in full compliance with all the provisions of this Agreement"
at the end of clause (iv) therein; and (C) inserting the
following immediately after clause (iv) therein:
(v) loans or advances made by the Borrower or any of its
Subsidiaries to Persons (other than Guarantors or
Subsidiaries described in clauses (iii) and (iv) above)
provided that immediately after the making of each such loan
or advance, the sum of such loans or advances and
Investments made under Section 5.08(iii) hereunder, does not
exceed the amount set forth in Section 5.08(iii) hereunder;
and (vi) loans or advances, in no event greater than 11.7
million Swedish kroner in the aggregate, made by XxXxxxxxx
Technologies AB to Newco (as described in the memorandum
referenced in the definition of MTL/MTOy Acquisition) in
connection with the MTL/MTOy Acquisition; provided that
after giving effect to the making of any loans, advances or
deposits permitted by this Section, the Borrower will be in
full compliance with all the provisions of this Agreement.
5. Amendment to Section 5.08. Section 5.08 of the Credit
Agreement hereby is deleted in its entirety, and the following is
substituted therefor as Section 5.08:
SECTION 5.08. Investments. Neither the Borrower
nor any of its Subsidiaries shall make Investments in any
Person except Investments: (i) as of the Closing Date
(including minority Investments to be made pursuant to the
Acquisition Agreements not exceeding $2,000,000 in the
aggregate) listed on Schedule 1.01(a); (ii) in Subsidiaries
which timely become and thereafter remain (A) Guarantors
pursuant to Section 5.24, or (B) Eligible First Tier Foreign
Subsidiaries pursuant to Section 5.25; (iii) consisting of
equity in Persons (exclusive of Investments made in
connection with the MTL/MTOy Acquisition) which do not
timely become and thereafter remain (A) Guarantors pursuant
to Section 5.24, or (B) Eligible First Tier Foreign
Subsidiaries pursuant to Section 5.25, provided that such
Investments do not exceed (x) from the Closing Date through
and including January 29, 1998, $25,000,000 in the
aggregate, or (y) after January 29, 1998, the greater of
$20,000,000 or 20% of Stockholder's Equity; (iv) as
permitted by Section 5.07; (v) in connection with the
MTL/MTOy Acquisition in an amount not exceeding $12,500,000
in the aggregate; and (vi) in (A) direct obligations of the
United States Government maturing within one year, (B)
certificates of deposit issued by a commercial bank whose
credit is reasonably satisfactory to the Agent, (C)
commercial paper rated A1 or the equivalent thereof by
Standard & Poor's Corporation or P1 or the equivalent
thereof by Xxxxx'x Investors Service, Inc. and in either
case maturing within 6 months after the date of acquisition
and/or (D) tender bonds the payment of the principal of and
interest on which is fully supported by a letter of credit
issued by a United States bank whose long-term certificates
of deposit are rated at least AA or the equivalent thereof
by Standard & Poor's Corporation and Aa or the equivalent
thereof by Xxxxx'x Investors Service, Inc.; provided,
however, with respect to clauses (ii), (iii) and (iv) in
this Section 5.08, no Investments shall be permitted to be
made after the Closing Date (A) in the event that a Default
or Event of Default is in effect or will be caused by such
Investment, and (B) unless the Borrower certifies to the
Agent in writing prior to making any such Investment the
Borrower's pro forma compliance with the financial covenants
set forth in Sections 5.03 and 5.06 of this Agreement, such
written certification and pro forma calculations to be in
form and substance satisfactory to the Agent in all
respects.
6. Amendments to Section 5.24. Section 5.24 of the Credit
Agreement hereby is amended by: (A) deleting the clause "within
20 Foreign Currency Business Days" appearing in subsection (b)
therein, and substituting therefor the clause "within 45 Foreign
Business Days;" and (B) deleting the term "XxXxxxxxx
Technological Sales Corporation" appearing in subsection (b)
therein, and substituting therefor the term "XxXxxxxxx
International Sales Corporation."
7. Amendment to Section 5.25. Section 5.25 of the Credit
Agreement hereby is amended by deleting the clause "within 20
Euro-Dollar Business Days" appearing therein, and substituting
therefor the clause "within 45 Euro-Dollar Business Days;"
8. Amendment to Schedule 1.01(a). Schedule 1.01(a) of the
Credit Agreement hereby is amended by adding the following in the
numerical order indicated to that portion of the Schedule which
is titled "Investments as of the Closing Date":
4. On August 1, 1997, XxXxxxxxx Technologies, Inc.
(the "Company") will complete the acquisition of
Syntech S.p.A. and its affiliated entities and
subsidiaries. The aggregate consideration paid
will be $47,107,128 in cash and approximately
$15,500,000 of debt assumed. The cash portion of
the purchase consideration will be made available
from the Company's $150,000,000 credit facility.
The transaction will involve the acquisition of
all the outstanding stock and warrants of
Synthetic Resin Technologies S.A., the Luxembourg
holding company of Syntech S.p.A., and all the
stock of Syntech, Inc. from Xxxxxxx Xxxxxx &
C.s.p.a., Gestin S.r.l. and Cable Beach Holdings
Ltd. Upon completion of the transaction, the
Company will contribute such stock and warrants to
its wholly-owned U.K. subsidiary XxXxxxxxx
Holdings Ltd., and the Luxembourg holding company
will be liquidated.
9. Default Waiver. The Borrower has informed the Agent
and the Banks that (i) Syntech S.p.A., a Subsidiary, has made a
loan of 4,250,000 Hong Kong Dollars to a Person in violation of
Section 5.07 of the Credit Agreement (the "Loan Default"), and
(ii) that the Borrower has not complied with the obligations set
forth under Sections 5.24 and 5.25 of the Credit Agreement with
respect to the execution and delivery of certain Loan Documents
described therein regarding the Borrower, XxXxxxxxx International
Sales Corporation, Syntech, Inc., Syntech France S.a.r.l.,
Syntech S.p.A., and XxXxxxxxx Holdings Ltd. (the "Delivery
Default"). The Borrower acknowledges and agrees that the Loan
Default and the Delivery Default constitute Events of Default
under Section 6.01 of the Credit Agreement. In reliance upon the
foregoing, the Agent and the Banks hereby waive the Loan Default
and the Delivery Default. The waiver of the Loan Default and the
Delivery Default does not constitute a waiver of any other
Default or Event of Default under the Credit Agreement whether
now existing or hereafter occurring.
10. Acquisition Waiver. The Borrower has informed the
Agent and the Banks that it seeks to acquire three new
subsidiaries in connection with the MTL/MTOy Acquisition.
Because of certain legal requirements existing in foreign
countries, the Borrower believes that it and the new subsidiaries
will be unable to comply with the requirements of Section 5.25 of
the Credit Agreement. The Agent and the Banks do hereby waive
compliance with the requirements set forth in Section 5.25 of the
Credit Agreement, solely with respect to those subsidiaries to be
acquired under the MTL/MTOy Acquisition, until forty-five days
after the date of consummation of the MTL/MTOy Acquisition, or
March 15, 1998, whichever occurs first.
11. Restatement of Representations and Warranties. The
Borrower hereby restates and renews each and every representation
and warranty heretofore made by it in the Credit Agreement and
the other Loan Documents as fully as if made on the date hereof
and with specific reference to this Waiver and First Amendment
and all other loan documents executed and/or delivered in
connection herewith.
12. Effect of Waiver and First Amendment. Except as set
forth expressly hereinabove, all terms of the Credit Agreement
and the other Loan Documents remain in full force and effect, and
constitute the legal, valid, binding and enforceable obligations
of the Borrower. The amendments contained herein are deemed to
have prospective application only, unless otherwise specifically
stated herein.
13. Ratification. The Borrower hereby restates, ratifies
and reaffirms each and every term, covenant and condition set
forth in the Credit Agreement and the other Loan Documents
effective as of the date hereof.
14. Counterparts. This Waiver and First Amendment may be
executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed
and delivered will be deemed to be an original and all of which
counterparts, taken together, will constitute but one and the
same instrument.
15. Section References. Section titles and references used
in this Waiver and First Amendment have no substantive meaning or
content of any kind whatsoever and are not a part of the
agreements among the parties hereto evidenced hereby.
16. No Default. To induce the Agent and the Banks to enter
into this Waiver and First Amendment and to continue to make
advances pursuant to the Credit Agreement, the Borrower hereby
acknowledges and agrees that, as of the date hereof, and after
giving effect to the terms hereof, there exists (i) no Default or
Event of Default and (ii) no right of offset, defense,
counterclaim, claim or objection in favor of the Borrower arising
out of or with respect to any of the Loans or other obligations
of the Borrower owed to the Banks under the Credit Agreement.
17. Further Assurances. The Borrower agrees to take such
further actions as the Agent reasonably requests in connection
herewith to evidence the amendments herein contained to the
Borrower.
18. Governing Law. This Waiver and First Amendment are
governed by and construed and interpreted in accordance with, the
laws of the State of Georgia.
19. Conditions Precedent. This Waiver and First Amendment
will become effective only upon (i) receipt by the Agent from
each of the parties hereto of a duly executed counterpart of this
Waiver and First Amendment, (ii) true and correct photocopies of
each of all documents (in such detail as may be reasonably
requested by the Agent) executed, delivered and/or furnished by
or to the Borrower in connection with the MTL/MTOy Acquisition on
or before the date of the consummation of the MTL/MTOy
Acquisition, and (iii) payment to the Agent of that certain fee
referenced in that certain letter from the Agent to Borrower
dated as of October 28, 1997. Notwithstanding anything contained
in this Waiver and First Amendment to the contrary, in the event
that the MTL/MTOy Acquisition is not fully consummated by
February 1, 1998, then the Agent's and the Banks' agreements with
respect to the following will be null and void: (y) the words
"and (vi) loans or advances, in no event greater than 11.7
million Swedish kroner in the aggregate, made by XxXxxxxxx
Technologies AB to Newco (as described in the memorandum
referenced in the definition of MTL/MTOy Acquisition) in
connection with the MTL/MTOy Acquisition;" appearing in the
proposed amendment to Section 5.07 set forth in paragraph 4
herein; and (z) paragraph 5 herein.
IN WITNESS WHEREOF, the Borrower, the Agent and each of the
Banks has caused this Waiver and First Amendment to be duly
executed, under seal, by its duly authorized officer as of the
day and year first above written.
XXXXXXXXX TECHNOLOGIES, INC., WACHOVIA BANK, N.A., as Agent and
as Borrower (SEAL) as a Bank (SEAL)
By: /s/Xxxxxx X. Xxxxxxx-Xxxxxxxxx By:/s/Xxxx X. Xxxxxx
Title: Vice President & CFO Title: Vice President
BANK OF AMERICA, BANK OF TOKYO-MITSUBISHI, LTD.,
as a Bank (SEAL) CHICAGO BRANCH, as a Bank (SEAL)
By:/s/Xxxxxx X. Xxxx By:/s/Xxxxxx Xxxxxxxx
Title: Vice President Title: Deputy General Manager
THE SAKURA BANK, LIMITED, XXXXXX BANK,
as a Bank (SEAL) as a Bank (SEAL)
By:/s/Xxxxxxxx Xxxxxxxx By:/s/Xxxxxxx X. Xxxxxxxx
Title: Joint General Manager Title: Assistant Vice President
THE FIRST NATIONAL BANK OF THE NORTHERN TRUST COMPANY,
CHICAGO, as a Bank (SEAL) as a Bank (SEAL)
By:/s/Xxxxx Xxxxxxx By:/s/Xxx Xxxxxxxxx
Title: Managing Director Title: Vice President
MELLON BANK, N.A. XXXXXX BANK, LTD, NEW YORK
as a Bank (SEAL) BRANCH, as a Bank (SEAL)
By:/s/Xxxxxx X. Xxxxx By:/s/Xxx Xxxxxxx, Xxxx Xxxxxx
Title: Vice President Title: Vice President, Vice President
CONSENT AND REAFFIRMATION OF GUARANTOR
The undersigned (i) acknowledges receipt of the foregoing Waiver
and First Amendment to Credit Agreement (the "Amendment"), (ii)
consents to the execution and delivery of the Amendment by the parties
thereto and (iii) reaffirms all of its obligations and covenants under
the respective Limited Guaranty Agreement executed by it in favor of
the Agent for the ratable benefit of the Banks, and agrees that none
of such obligations and covenants shall be affected by the execution
and delivery of the Amendment.
XXXXXXXXX INTERNATIONAL SALES CORPORATION
By:/s/Xxxxxx X. Xxxxxxx-Xxxxxxxxx
Title: Vice President and CFO
