EXHIBIT 10.5
THIS SUPPLEMENTAL AGREEMENT (this "Agreement") is made on _____________ 1998
AMONG:
(1) PIPELINE INDUCTION HEAT LIMITED, a private company limited by shares
incorporated in England and Wales (registered number 1478556) and having
its registered office at The Pipeline Centre, Unit 12, Xxxxxxxxxx Road,
Xxxxxxxxxx Xxxx Xxxxxxxxxx Xxxxxx, Xxxxxxx, XX00 0XX;
(2) BANKBOSTON, N.A., LONDON BRANCH, in its individual capacity (together with
its successors in title and assign, the "BANKS");
(3) BANKBOSTON, N.A., LONDON BRANCH, in its capacity as the Overdraft Bank
(the "OVERDRAFT BANK");
(4) BANKBOSTON, N.A., LONDON BRANCH, in its capacity as the Issuing Bank (the
"ISSUING BANK"); and
(5) BANKBOSTON, N.A., LONDON BRANCH, in its capacity as agent and trustee for
the Banks, the Overdraft Bank and the Issuing Bank (the "AGENT").
RECITALS
(A) This Agreement amends a facility agreement dated 12 June 1997 made among
the parties to this Agreement (such facility agreement as amended,
supplemented, modified or restated and in effect for the time being
referred to in this Agreement as the "FACILITIES AGREEMENT").
(B) The parties to the Facilities Agreement have agreed that it shall be
amended upon the terms and subject to the conditions set forth below.
IT IS HEREBY AGREED as follows:
1. EXPRESSIONS
Expressions used in this Agreement without definition that are defined in
or defined by reference in the Facilities Agreement shall have the same
meanings when used in this Agreement.
2. AMENDMENTS TO FACILITIES AGREEMENT
With effect from the Effective Date (as defined in Clause 5 hereof):
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2.1 The Facilities Agreement shall continue in full force and effect save as
amended by this Agreement, and all references in the Loan Documents to the
term "Facilities Agreement" shall be in all respects read and construed as
being references to the Facilities Agreement as amended by this Agreement.
2.2 The definition of "Security Documents" is hereby amended by adding at the
end thereof the phrase "and further including any and all security
documents executed and delivered in connection with each UK Permitted
Acquisition". 2.3 The definition of "Maximum Commitment" contained in
Clause 1.1 of the Facilities Agreement is hereby amended by replacing the
reference to "(pound)8,050,000, with a reference to (pound)4,500,000". 2.4
Clause 1.1 of the Facilities Agreement is further amended by inserting the
following definitions in the appropriate alphabetical order:
"PURCHASE PRICE" shall mean the sum of all cash paid, all
Indebtedness assumed or incurred (other than Indebtedness under
this Agreement), and the stated issue price of any shares or the
principal amount of any debt issued by the Borrower in connection
with any UK Permitted Acquisition.
"UK PERMITTED ACQUISITION" shall mean an acquisition by the
Borrower of substantially all of the assets of or of the shares
in a Person in the same or similar lines of business as that of
the Borrower; PROVIDED, that in each case each of the following
conditions is met:
(i) upon completion of the UK Permitted Acquisition, unless
waived by the Agent, the Borrower shall have provided,
and shall have caused the target to provide, to the
Agent all such additional guarantees, debentures,
security documents, pledge agreements and other
documents or instruments (where appropriate, in
substantially the form previously delivered to the
Agent) necessary or appropriate to grant to the Agent,
for the benefit of the Banks, a first fixed and floating
charge over substantially all of the assets of the
Person acquired or of the assets acquired, as
applicable; and
(ii) the Agent and the Banks shall have received (i) written
notice of the proposed acquisition at least ten (10)
Business Days' prior to the proposed completion date for
the acquisition, describing the relevant acquisition to
be completed, including without limitation the
anticipated completion date and the anticipated amount
of the Advances to be borrowed in connection with the
proposed acquisition, (ii) copies of all documents,
agreements and instruments to be entered into by the
Borrower in connection with such acquisition and
evidence of compliance with all requirements of the Loan
Documents and (iii) PRO FORMA financial statements and
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calculations, in form and substance satisfactory to the
Agent, evidencing that immediately prior to and
following such acquisition the Parent will be in
compliance on a Pro Forma Basis (as defined in the
Parent Loan Agreement) with the financial covenants set
forth in Section 11 of the Parent Loan Agreement for the
period of 12 months following completion of such
acquisition;
(iii) no Event of Default or Unmatured Event of Default shall
have occurred and be continuing at the time of
completion of the proposed acquisition, and no Event of
Default or Unmatured Event of Default would result
therefrom;
(iv) the company or business to be acquired must have
substantially all of its operations located in the UK;
(v) any Indebtedness assumed or incurred in connection with
such acquisition must be on terms and conditions
acceptable to the Agent;
(vi) the aggregate Purchase Price for all UK Permitted
Acquisitions shall not exceed (pound)1,450,000; and
(vii) the Borrower shall have delivered to the Agent and the
Banks a copy of all financial statements received from
the company to be acquired for the periods prior to the
proposed closing date for such acquisitions.
2.5 Clause 1.3 of the Facilities Agreement is hereby amended by deleting it in
its entirety and replacing it with the following:
"1.3 PURPOSE. This Agreement sets out the terms and conditions upon
and subject to which the Banks, the Overdraft Bank and the Issuing
Bank will make available to the Borrower credit facilities of up to
the Maximum Commitment Amount to be used solely for the purposes set
out in Clause 7.4."
2.6 Clause 7.4 of the Facilities Agreement is hereby amended by deleting it in
its entirety and replacing it with the following:
"7.4 USE OF PROCEEDS. Use the Advances made available hereunder and
the Collateral Instruments issued, extended or renewed hereunder
solely for the following purposes:
(i) The Advances may be used to repay an intercompany loan from
Holdings to the Borrower in the amount of $2,491,280, the
proceeds of which were used to repay a loan from Xxxxxxxxxxx
U.K. Ltd. to the Borrower,
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(ii) The Advances and the Collateral Instruments may be used to
support ongoing working capital requirements and other general
corporate purposes of the Borrower, and
(iii) The Advances in an aggregate amount up to (pound)1,450,000 may
be used to pay the Purchase Price for UK Permitted
Acquisitions;
PROVIDED, HOWEVER, that not more than (pound)8,050,000 of the
Maximum Commitment Amount shall be used for the purposes described
in clauses (i) and (ii) herein.
None of the Advances or the Collateral Instruments shall be used in
any way which infringes Section 151 of Companies Xxx 0000 or any law
of any other relevant jurisdiction which restricts the incurring of
indebtedness and/or the creation of security by the Borrower or its
Subsidiaries in connection with the acquisition, directly or
indirectly, of ownership or control of the Borrower or its
Subsidiaries. Without affecting the obligations of the Borrower in
any way, no Bank shall be bound to monitor or verify the application
of any Advance."
3. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Agent, the Banks, the
Overdraft Bank and the Issuing Bank that the representations and
warranties contained in Clause 6 of the Facilities Agreement and the other
representations and warranties made by or on behalf of each member of the
Affiliate Group in connection with the Facilities Agreement or any of the
Loan Documents were true when made and continue to be true on the date
hereof with the same effect as if made on the date hereof.
4. CONDITIONS PRECEDENT
Unless otherwise agreed by the Agent, the effectiveness of this Agreement
shall be subject to the satisfaction of the following conditions
precedent:
4.1 Agent shall have received a counterpart of this Agreement duly
executed and delivered by each of the parties hereto, including
Holdings and the Parent which shall have executed and delivered the
guarantee confirmation act forth on the signature pages hereto.
4.2 The Agent shall have received an amendment fee in the amount of
(pound)3625 for the ratable accounts of the Banks in accordance with
their respective Commitment Percentages.
4.3 The Agent shall have received the First Amendment to the Parent Loan
Agreement, executed by all parties thereto.
4.4 The Agent shall have received a duly certified copy of the
Certificate of Incorporation, and the Certificate of Incorporation
on change of name and the Memorandum and Articles of Association of
the Borrower.
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4.5 The Agent shall have received resolutions of the directors of the
Borrower approving the terms of and the transactions contemplated by
this Agreement and setting out the reasons why the transaction is
for the commercial benefit of the Borrower, and authorizing a
specified person or persons to execute this Agreement.
4.6 The Agent shall have received a specimen of the signature of each
person authorized by the resolution referred to above an which the
Agent, the Banks, the Issuing Bank and the Overdraft Bank shall be
entitled to rely conclusively.
4.7 The Agent and each of the Banks shall have received an opinion of
counsel for the Borrower in form and substance satisfactory to the
Agent.
5. EFFECTIVENESS
The amendments set forth in this Agreement shall take effect on the date
(the "Effective Date") of satisfaction of each of the conditions precedent
set forth in Clause 4 hereof.
6. COSTS AND EXPENSES.
The provisions of Clause 7.2 of the Facilities Agreement shall apply
MUTATIS MUTANDIS to this Agreement as though set out herein in full.
7. CLAUSE 12.1 OF THE FACILITIES AGREEMENT
It is hereby acknowledged that this Agreement constitutes an amendment of
certain provisions of the Facilities Agreement in accordance with the
provisions of Clause 12.1 of the Facilities Agreement.
8. COUNTERPARTS
This Agreement may be executed in any number of copies which, taken
together, shall constitute a single agreement whether or not each party
has executed every copy.
9. LAW AND JURISDICTION
This Agreement shall be governed by and construed in accordance with the
laws of England and Wales and for the benefit of the Agent, each of the
Banks, the Issuing Bank and the Overdraft Bank, the Borrower hereby
irrevocably submits to the jurisdiction of the English courts in
connection with any disputes which may arise in connection with the legal
relationships established by this Agreement.
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AS WITNESS the hands of the authorized signatories of the parties hereto the day
and year first above written.
SIGNED by )
for and on behalf of PIPELINE ) _____________________
INDUCTION HEAT LIMITED ) Director
)
SIGNED by )
for and on behalf of )
BANKBOSTON, N.A., ) _____________________
LONDON BRANCH, as a ) Authorised Signatory
Bank, Agent, Overdraft )
Bank and Issuing Bank )
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Confirmation of Holdings Guarantee
PIH Holdings Limited, a company incorporated in England, as guarantor
under the Holdings Guarantee (as defined in the Facilities Agreement referred to
above) hereby confirms to the Banks, the Agent, the Issuing Bank and the
Overdraft Bank that the Holdings Guarantee remains in full force and effect and
continues to constitute, among other things, an absolute and unconditional
guarantee of all of the Guaranteed Obligations as therein defined which includes
the obligations of the Borrower under the Facilities Agreement as amended by
this Agreement.
SIGNED by )
for and on behalf of ) ____________________
PIH HOLDINGS LIMITED: ) Director
Confirmation of CRC-Xxxxx Pipeline International, Inc. Guaranty
CRC-Xxxxx Pipeline International Inc., a Delaware Corporation, as
guarantor under the Parent Guarantee (as defined in the Facilities Agreement
referred to above) hereby confirms to the Banks, the Agent, the Issuing Bank and
the Overdraft Bank that the Parent Guarantee remains in full force and effect
and continues to constitute, among other things, an absolute and unconditional
guarantee of all obligations described therein which includes the obligations of
the Borrower under the Facilities Agreement as amended by this Agreement.
SIGNED by )
for and on behalf of )
CRC-XXXXX PIPELINE ) ____________________
INTERNATIONAL, INC.: ) Title:
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