CONSENT, WAIVER AND AMENDMENT NO. 2 to CREDIT AGREEMENT (364-DAY FACILITY)
EXHIBIT 99.7
CONSENT,
WAIVER AND AMENDMENT NO. 2
to
CREDIT
AGREEMENT (364-DAY FACILITY)
This
CONSENT, WAIVER AND AMENDMENT NO. 2 TO CREDIT AGREEMENT (364-DAY FACILITY) (this
“Agreement”),
dated as of January 23, 2009, is entered into by and among, Caterpillar
Financial Services Corporation (the “Borrower”), the Banks
parties hereto (the “Banks”), and Société
Générale (“SG”), as agent (the
“Agent”) under
the Credit Agreement defined below. Each capitalized term used herein
and not defined herein shall have the meaning ascribed thereto in the Credit
Agreement.
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PRELIMINARY
STATEMENTS
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A. The
Borrower, the Banks and the Agent are parties to the Credit Agreement (364-Day
Facility), dated as of July 15, 2008 (as the same may be further amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”). The Borrower has requested that the Banks and the
Agent amend the Credit Agreement as hereinafter set forth, and the Banks and the
Agent have agreed to amend the Credit Agreement pursuant to the terms of this
Agreement.
B. Section
5.03(b) of the Credit Agreement requires the Borrower, unless the Majority Banks
shall otherwise consent in writing, to maintain a ratio of (A) earnings of the
Borrower before income taxes and Interest Expense to (B) Interest Expense of not
less than 1.15 to 1 for each fiscal quarter (the “Interest Coverage Ratio
Covenant”).
C. The
Borrower has requested that, pursuant to Sections 5.03 of the Credit Agreement,
the Majority Banks provide written consent as further described herein, and the
Majority Banks have agreed to grant such consent pursuant to the terms and
conditions hereof.
D. The
Borrower has advised the Banks and the Agent that Caterpillar, Inc. may fail for
the quarter ended December 31, 2008, to have had a Consolidated Net Worth equal
to or greater than 75% of its Consolidated Net Worth as of the prior year-end
which may result in an event described in Section 6.01(j) of the Credit
Agreement (the “Caterpillar Net Worth
Event”) .
E. The
Borrower has requested that the Banks agree to irrevocably waive any Event of
Default that may arise under Section 6.01(j) of the Credit Agreement as a result
of the occurrence of the Caterpillar Net Worth Event, and the Banks have agreed
to grant such irrevocable waiver pursuant to the terms hereof.
SECTION
1. Limited
Consent. Effective as of December 31, 2008, subject to the
satisfaction of the conditions precedent set forth in Section 4 below, the
Majority Banks hereby consent and agree that (i) the Borrower shall not be
required to comply with or otherwise satisfy the Interest Coverage Ratio
Covenant solely for the fiscal quarter ended December 31, 2008, and (ii) the
inability of the Borrower to comply with or otherwise satisfy the Interest
Coverage Ratio Covenant shall not constitute an Event of Default or unmatured
Event of Default (i.e., an event that with notice, time or both would become an
Event of Default) under the Credit Agreement solely for the fiscal quarter ended
December 31, 2008 (collectively, the “Specified
Consent”). The Majority Banks also consent and agree that the
Borrower is not required to comply with Section 5.01(f)(iii) of the Credit
Agreement solely to the extent that the Compliance Certificate required to be
delivered with any financial statements for the fiscal quarter or the fiscal
year ended December 31, 2008 would require demonstration of the Borrower’s
compliance with the Interest Coverage Ratio Covenant. The Specified
Consent shall not be deemed to constitute a consent to or a waiver of any Event
of Default or unmatured Event of Default, any future breach of the Credit
Agreement, or any future breach of the other agreements, documents and
instruments delivered in connection with the Credit Agreement. The
agreement to the terms hereof by any of the Banks or Agent shall not establish a
custom or course of dealing among any of the Agent, any Bank and the
Borrower.
SECTION
2. Limited
Waiver. Effective as of December 31, 2008, subject to the
satisfaction of the condition precedent set forth in Section 4 below, the
Banks hereby irrevocably waive any Event of Default or unmatured Event of
Default that would otherwise result under Section 6.01(j) of the Credit
Agreement from the occurrence of the Caterpillar Net Worth
Event. This irrevocable waiver shall be effective solely with respect
to the occurrence of the Caterpillar Net Worth Event in the fiscal quarter ended
December 31, 2008, and shall not be deemed to constitute a waiver of any other
Event of Default or unmatured Event of Default, any future breach of the Credit
Agreement, or any future breach of the other agreements, documents and
instruments delivered in connection with the Credit Agreement. The
agreement to the terms hereof by any of the Banks or Agent shall not establish a
custom or course of dealing among any of the Agent, any Bank and the
Borrower.
SECTION
3. Amendments to the Credit
Agreement. Effective as of the date hereof, subject to the
satisfaction of the condition precedent set forth in Section 4 below, the
Credit Agreement is hereby amended as follows:
3.1 Section 1.01 is
amended by deleting therefrom the defined term “Applicable Eurodollar Margin” in its
entirety.
3.2 Section 1.01 is
further amended by adding the following defined terms thereto in alphabetical
order:
“Applicable Margin”
means (a) with respect to Base Rate Advances, the greater of (i) the applicable
Market Rate Spread minus 1.00% and (ii) 0.00%; and (b) with respect to
Eurodollar Advances, the applicable Market Rate Spread.”
“Market Rate Spread”
means, for any Advance for any Interest Period, the rate per annum equal to the
one-year credit default swap mid-rate spread of the Borrower, as provided by the
Quotation Agency for the one-year period beginning on the Rate Set Date (as
defined below), appearing on the Quotation Agency’s website as of 12:00 noon
(New York City time) or otherwise delivered by the Quotation Agency to the
Agent, in each case two Business Days prior to the first day of such Interest
Period (the “Rate Set
Date”); provided, that the
Market Rate Spread shall in no event be less than a rate per annum equal to
0.25% or greater than the applicable Maximum Market Rate Spread, in each case as
of the applicable Rate Set Date; provided, further that in the
event that the Market Rate Spread is not available from the Quotation Agency on
the Rate Set Date for any Interest Period, the Market Rate Spread for such
Interest Period shall be the Maximum Market Rate Spread on such Rate Set
Date.
“Maximum Market Rate
Spread” means, as of any date of determination, with respect to any
Advance, a rate per annum equal to 1.75%.
“Quotation Agency”
means Markit Group Limited or any successor thereto.””
3.3 Sections 2.07(a) and
(b) are amended
and restated in their entirety as follows:
(a) Base Rate
Advances. If such Advance is a Base Rate Advance, a rate per
annum equal at all times during the Interest Period for such Advance to the sum
of the Base Rate in effect from time to time plus the Applicable
Margin, payable on the last day of such Interest Period (or, with respect to any
portion thereof that shall be prepaid pursuant to Section 2.09 or
otherwise in accordance with the terms of this Agreement, on the date of such
prepayment).
(b) Eurodollar
Advances. If such Advance is a Eurodollar Advance, a rate per
annum equal at all times during the Interest Period for such Advance to the sum
of the Adjusted LIBOR Rate for such Interest Period plus the Applicable
Margin, payable on the last day of such Interest Period (or, with respect to any
portion thereof that shall be prepaid pursuant to Section 2.09 or
otherwise in accordance with the
terms of this Agreement, on the date of such prepayment) and, if such Interest
Period has a duration of more than three months, on the day which occurs during
such Interest Period three months from the first day of such Interest
Period.
SECTION
4. Condition
Precedent. This Agreement shall become effective and be deemed
effective as of the date hereof upon the Agent’s receipt of duly executed
originals of this Agreement from the Borrower, the Agent and the
Banks.
SECTION
5. Covenants, Representations
and Warranties of the Borrower.
5.1 Upon the
effectiveness of this Agreement, the Borrower hereby reaffirms all covenants,
representations and warranties made by it in the Credit Agreement, after giving
effect to this Agreement, and agrees that all such covenants, representations
and warranties shall be deemed to have been re-made as of the effective date of
this Agreement.
5.2 The
Borrower hereby represents and warrants that (a) this Agreement constitutes a
legal, valid and binding obligation of the Borrower, enforceable against the
Borrower in accordance with its terms, except as enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or affecting creditor’s rights generally and by the
effect of general principles of equity and (b) upon the effectiveness of this
Agreement, no Event of Default shall exist with respect to the Borrower and no
event shall exist which, with the giving of notice, the lapse of time or both,
would constitute an Event of Default with respect to the Borrower.
SECTION
6. Reference to and Effect on
the Credit Agreement.
6.1 Upon the
effectiveness of this Agreement, each reference in the Credit Agreement to “this
Agreement”, “hereunder”, “hereof”, “herein” or words of like import shall mean
and be a reference to the Credit Agreement, as affected by this Agreement, and
each reference to the Credit Agreement in any other document, instrument or
agreement executed and/or delivered in connection with the Credit Agreement
shall mean and be a reference to the Credit Agreement as affected
hereby.
6.2 Except as
specifically affected by this Agreement, the Credit Agreement, the Notes and all
other documents, instruments and agreements executed and/or delivered in
connection therewith shall remain in full force and effect and are hereby
ratified and confirmed.
6.3 The
execution, delivery and effectiveness of this Agreement shall not operate as a
waiver of any right, power or remedy of any party under the Credit Agreement,
the Notes or any other document, instrument or agreement executed in connection
therewith, nor constitute a waiver of any provision contained therein, except as
specifically set forth herein.
SECTION
7. Execution in
Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which taken together shall constitute one and the same
instrument. A facsimile or PDF copy of any signature hereto shall
have the same effect as the original of such signature.
SECTION
8. Governing
Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
SECTION
9. Headings. Section
headings in this Agreement are included herein for convenience of reference only
and shall not constitute a part of this Agreement for any other
purpose.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by
their respective officers or representatives thereunto duly authorized as of the
date first above written.
CATERPILLAR
FINANCIAL
SERVICES
CORPORATION
By: /s/ Xxxxx
X. Xxxxxxxx
Name:
Xxxxx X. Xxxxxxxx
Title:
Treasurer
SOCIETE
GENERALE, as Agent
By: /s/ Xxxx X.X. Xxxxxxx
Xx.
Name:
Xxxx X.X. Xxxxxxx Xx.
Title:
Managing Director
SOCIETE
GENERALE, as a Bank
By: /s/ Xxxx X.X. Xxxxxxx
Xx.
Name:
Xxxx X.X. Xxxxxxx Xx.
Title:
Managing Director
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ROYAL
BANK OF CANADA, as a Bank
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By: /s/ Xxxxxxxx
Majesty
Name:
Xxxxxxxx Majesty
Title:
Authorized Signatory
Signature
Page to
Consent,
Waiver and Amendment No. 2 to CFSC Credit Agreement (364-Day
Facility)
