EXHIBIT 10.11
DATED 25 April, 2002
SUPPLEMENTAL AGREEMENT
FOR
ENODIS HOLDINGS LIMITED
WITH
THE ROYAL BANK OF SCOTLAND plc
as Facility Agent
relating to a US$455,000,000 CREDIT AGREEMENT
dated 20th February, 2002
INDEX
CLAUSE PAGE
1. Interpretation........................................................1
2. Amendments............................................................1
3. Representations.......................................................2
4. Miscellaneous.........................................................3
5. Governing Law.........................................................3
SCHEDULE
1. Amendments to Credit Agreement........................................4
2. Condition precedent documents........................................10
SIGNATORIES...................................................................11
THIS AGREEMENT is dated April, 2002 between:
(1) ENODIS HOLDINGS LIMITED (registered number 4330209) (the COMPANY); and
(2) THE ROYAL BANK OF SCOTLAND plc as facility agent (in this capacity the
FACILITY AGENT).
BACKGROUND
(A) This Agreement is supplemental to and amends a credit agreement dated
20th February, 2002 between, among others, the Company and the Facility
Agent (the CREDIT AGREEMENT).
(B) The Majority Lenders (as defined in the Credit Agreement) have
consented to the amendments to the Credit Agreement contemplated by
this Agreement. Accordingly, the Facility Agent is authorised to
execute this Agreement on behalf of the Finance Parties.
(C) The Company has consented to the amendments to the Credit Agreement
contemplated by this Agreement and is authorised to execute this
Agreement.
IT IS AGREED as follows:
1. INTERPRETATION
1.1 DEFINITIONS
(a) Capitalised terms defined in the Credit Agreement have, unless
expressly defined in this Agreement, the same meaning in this
Agreement.
(b) EFFECTIVE DATE means the date the Facility Agent notifies the Company
and the Lenders that it has received all of the documents set out in
Schedule 2 (Condition precedent documents) in form and substance
satisfactory to the Facility Agent or such other later date as the
Company and the Facility Agent may agree.
1.2 CONSTRUCTION
The provisions of Clause 1.2 (Construction) of the Credit Agreement
apply to this Agreement as though they were set out in full in this
Agreement except that references to the Credit Agreement are to be
construed as references to this Agreement.
2. AMENDMENTS
(a) Subject as set out below, the Credit Agreement will be amended from the
Effective Date in the manner set out in Schedule 1 (Amendments to the
Credit Agreement).
(b) The Facility Agent must notify the Company and the Lenders as soon as
reasonable practicable once it has received all of the documents set
out in Schedule 2 (condition precedent documents) in form and substance
satisfactory to it.
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3. REPRESENTATIONS
3.1 REPRESENTATIONS
The representations set out in this Clause are made by the Company on
the date of this Agreement to each Finance Party.
3.2 POWERS AND AUTHORITY
It has the power to enter into and perform, and has taken all necessary
action to authorise the entry into and performance of this Agreement
and the transactions contemplated by this Agreement.
3.3 LEGAL VALIDITY
(a) Subject to any general principles of law limiting its obligations and
specifically referred to in any legal opinion delivered under Schedule
2 (Conditions precedent documents) or to any reservation as set out
below, this Agreement constitutes its legally binding, valid and
enforceable obligation and validly and effectively amends the Credit
Agreement.
(b) A "reservation" for the purposes of paragraph (a) is the principle that
equitable remedies are remedies which may be granted or refused at the
discretion of the court, the limitation on enforcement by laws relating
to bankruptcy, insolvency, liquidation, re-organisation, court schemes,
moratoria, administration and other laws generally affecting the rights
of creditors, the time barring of claims under the Limitation Acts and
similar principles.
3.4 NON-CONFLICT
The entry into and performance by it of, and the transactions
contemplated by, this Agreement do not and will not conflict with:
(a) any law or regulation applicable to it; or
(b) conflict with its or any of its Subsidiaries' constitutional
documents; or
(c) conflict with any document which is binding on it or any of
its Subsidiaries or any of its or its Subsidiaries' assets.
3.5 AUTHORISATIONS
All authorisations required by it in connection with the entry into,
performance, validity and enforceability of, and the transactions
contemplated by, this Agreement have been obtained or effected (as
appropriate) and are in full force and effect.
3.6 CREDIT AGREEMENT
The Company confirms to each Finance Party that on the date of this
Agreement the Repeating Representations:
(a) are true; and
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(b) would also be true if references to the Credit Agreement are
construed as references to the Credit Agreement as amended by
this Agreement.
In each case, each Repeating Representation is applied to the
circumstances existing at the date of this Agreement.
4. MISCELLANEOUS
(a) This Agreement is a Finance Document.
(b) Subject to the terms of this Agreement, the Credit Agreement and each
Security Document will remain in full force and effect and the Credit
Agreement and this Agreement will be read and construed as one
document.
5. GOVERNING LAW
This Agreement is governed by English law.
This Agreement has been entered into on the date stated at the beginning of this
Agreement.
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SCHEDULE 1
AMENDMENTS TO CREDIT AGREEMENT
The Credit Agreement is hereby amended as follows:
(a) in Clause 1.1 (Definitions) the definition of "BUSINESS PLAN" is
deleted in its entirety and replaced with the following:
""BUSINESS PLAN"
means the agreed financial model dated 12th March, 2002 prepared by
Enodis plc and the Company and delivered to the Arrangers.";
(b) in Clause 11.5 (Mandatory prepayment - Surplus Cashflow) paragraphs (a)
and (b) are deleted in their entirety and replaced with the following:
"(a) In this Subclause:
"SURPLUS CASHFLOW"
means Consolidated Cashflow for any financial year or for the
financial half-year comprising the period from 1st April, 2002
to 28th September, 2002:
(i) minus Consolidated Total Debt Service during such
period; and
(ii) before deducting dividends paid by
Enodis plc during
or in respect of such period.
"SEMI-ANNUAL SURPLUS CASHFLOW"
means Consolidated Cashflow during the first half of any
financial year:
(i) minus Consolidated Total Debt Service during such
period; and
(ii) before deducting dividends paid by
Enodis plc during
or in respect of such period.
(b) The Company must apply (or procure that the Borrowers apply)
an amount equal to 75 per cent. of Surplus Cashflow for each
financial year (or financial half-year for the financial
half-year comprising the period from 1st April, 2002 to 28th
September, 2002) towards prepaying the Credits (provided that
the Company may take into account any Semi-annual Surplus
Cashflow prepayment made during such financial year when
calculating if any amount is payable with respect to 75 per
cent. of Surplus Cashflow for such financial year).";
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(c) in Clause 21.1 (Financial statements) paragraph (a) (i) is amended by
adding after the words "annual cashflow statement" the words "and an
unaudited half-year cashflow statement for the financial half-year
comprising the period from 1st April, 2002 to 28th September, 2002)"
and paragraph (b) (i) is amended by adding after the words "annual" the
words "(or half-year)";
(d) in Clause 22.1 (Definitions) the definition of "CONSOLIDATED CASHFLOW"
is deleted in its entirety and replaced with the following:
""CONSOLIDATED CASHFLOW"
means, for a Measurement Period, Consolidated EBITDA for that
Measurement Period, adjusted by:
(a) DEDUCTING any increase and ADDING any decrease in Net Working
Capital over that Measurement Period and adjusting, in a
manner consistent with the methodology employed in the
Original Financial Statements, for any changes in other long
term assets and long term liabilities (excluding changes in
Financial Indebtedness, Tax, dividend and fixed asset balance
sheet accounts), to the extent not already reflected in
determining Consolidated EBITDA;
(b) ADDING any extraordinary or exceptional item received in Cash
or DEDUCTING any extraordinary or exceptional item paid in
Cash during that Measurement Period (ignoring, and neither
deducting nor adding back, any up front fees and other
financing costs relating to this Agreement and/or the Bond
Documents and/or the Equity Offering which are incurred during
such Measurement Period);
(c) DEDUCTING Capital Expenditure paid or required to be paid
during that Measurement Period;
(d) DEDUCTING any net gains and ADDING BACK any net losses for
that Measurement Period arising on the disposal of fixed
assets to the extent reflected in Consolidated EBITDA;
(e) ADDING the net proceeds received in Cash during that
Measurement Period of any disposal of fixed assets;
(f) DEDUCTING all non-Cash credits and ADDING BACK all non-Cash
debits (in each case to the extent not otherwise specifically
dealt with in this definition) included in Consolidated EBITDA
during that Measurement Period;
(g) DEDUCTING the Cash cost of acquiring any subsidiary
undertakings or minority interests incurred during that
Measurement Period;
(h) ADDING the net proceeds of any disposals of Subsidiaries,
subsidiary undertakings or minority interests received in Cash
during that Measurement Period;
(i) DEDUCTING all dividends or any other distributions payable
during that Measurement Period to any person which is not a
member of the Plc Group;
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(j) DEDUCTING all corporate tax and withholding tax paid or which
fell due for payment during that Measurement Period; and
(k) DEDUCTING (to the extent otherwise included) any proceeds of a
Disposal, Share Disposal or insurance claim to the extent of
the amount of any prepayment required to be made under Clauses
11.4 and/or 11.7 in consequence of the occurrence thereof,
in each case ensuring that no item is effectively credited or deducted
more than once in determining Consolidated Cashflow.";
(e) in Clause 22.1 (Definitions) the definition of "CONSOLIDATED EBITDA" is
deleted in its entirety and replaced with the following:
""CONSOLIDATED EBITDA"
means the consolidated net pre-taxation profits of the Plc Group for a
Measurement Period, adjusted by:
(a) ADDING BACK Consolidated Interest Payable;
(b) DEDUCTING any financing charges received or receivable by the
Plc Group in respect of that Measurement Period;
(c) EXCLUDING any amount attributable to minority interests and,
for the avoidance of doubt, this amount shall be the Equity
minority interest figure shown in the Group profit and loss
account for the Measurement Period;
(d) EXCLUDING any exceptional or extraordinary item;
(e) EXCLUDING any profit or loss arising during that Measurement
Period with respect to Felsted after the date of this
Agreement;
(f) ADDING BACK depreciation and amortisation including the
amortisation of deferred finance cost;
(g) ADDING BACK any up front fees and other finance costs,
including up-front costs payable under this Agreement and/or
under the Bond Documents and /or in connection with the Equity
Offering, in each case in connection with the arrangement or
underwriting thereof, written off during that Measurement
Period;
(h) DEDUCTING the amount of profit of any joint venture included
in Consolidated EBITDA during that Measurement Period which
has not been distributed in Cash to a member of the Plc Group;
(i) for the purposes of calculating the ratio set out in Clause
22.4 (Leverage) only, INCLUDING the net pre-taxation profits
of a member of the Plc Group as adjusted in accordance with
paragraphs (a) to (h) above or business acquired during that
Measurement Period for the part of that Measurement Period
when it was not a member of the Plc Group and/or the business
or assets were not owned by a member of the Plc Group; and
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(j) for the purposes of calculating the ratio set out in Clause
22.4 (Leverage) only (and, for each of the Measurement Periods
ending on 31st March, 2002, 30th June, 2002, 30th September,
2002 and 31st December, 2002 only, for the purposes of
calculating the ratio set out in Clause 22.5 (Interest
Cover)), EXCLUDING the net pre-taxation profit attributable to
any member of the Plc Group as adjusted in accordance with
paragraphs (a) to (h) above or to any business sold during
that Measurement Period.";
(f) the following definition is added to Clause 22.1 (Definitions):
""NET WORKING CAPITAL"
means all stock (other than with respect to Felsted) for the time being
owned by members of the Plc Group,
(a) adding amounts for the time being owing (whether or not due)
to members of the Plc Group (on a consolidated basis) which
constitute current assets of the Plc Group including, for the
avoidance of doubt, prepayments (other than amounts of or in
respect of Financial Indebtedness and Tax and amounts with
respect to Felsted);
(b) deducting amounts for the time being owing (whether or not
due) by members of the Plc Group (on a consolidated basis)
which constitute current liabilities including, for the
avoidance of doubt, accruals (other than amounts of or in
respect of Financial Indebtedness, Tax and dividends and
amounts with respect to Felsted),
in each case as determined in accordance with the Accounting
Principles.";
(g) in Clause 22.1 (Definitions) the definition of "CONSOLIDATED NET
INTEREST PAYABLE" is amended by adding the following to the end of the
definition:
", except that for each of the Measurement Periods ending on 31st
March, 2002, 30th June, 2002, 30th September, 2002 and 31st December,
2002 only, Consolidated Net Interest Payable will be calculated as if
the Measurement Period was from Closing (in the case of the Measurement
Period ending on 31st March, 2002) and from 1st April, 2002 (in the
case of the Measurement Periods ending on 30th June, 2002, 30th
September, 2002 and 31st December, 2002) to the end of the actual
Measurement Period, and then annualising the amount of Consolidated Net
Interest Payable so obtained by multiplying it by a fraction of which
the numerator is 365 and the denominator is the number of days in the
period from Closing or 1st April, 2002 (as the case may be) to the end
of the actual Measurement Period";
(h) in Clause 22.1 (Definitions) the definition of "CONSOLIDATED NET SENIOR
INTEREST PAYABLE" is amended by adding the following to the end of the
definition:
", except that for each of the Measurement Periods ending on 31st
March, 2002, 30th June, 2002, 30th September, 2002 and 31st December,
2002 only, Consolidated Net Senior Interest Payable will be calculated
as if the Measurement Period was from Closing (in the case of the
Measurement Period ending on 31st March, 2002) and from 1st April, 2002
(in the case of the Measurement Periods ending on 30th June, 2002, 30th
September, 2002 and 31st December, 2002) to the end of the relevant
Measurement Period, and then annualising the amount of Consolidated Net
Interest Payable so obtained by multiplying it by a fraction of which
the
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numerator is 365 and the denominator is the number of days in the
period from Closing or 1st April, 2002 (as the case may be) to the end
of the actual Measurement Period";
(i) Clause 22.6 (Cash flow) is amended by adding the words ", starting with
the Measurement Period ending on 31st December, 2002," after the words
"for any Measurement Period"; and
(j) Clause 22.7 (Covenant Table) is amended by deleting the table in its
entirety and replacing it with the following:
DATE V W X Y Z
31st March, 2002 4.50:1 3.00:1 2.00:1 3.20:1 -
30th June, 2002 4.00:1 2.90:1 2.15:1 3.20:1 -
30th September, 2002 4.15:1 2.80:1 2.15:1 3.20:1 -
31st December, 2002 3.95:1 2.65:1 2.30:1 3.50:1 1.05
31st March, 2003 3.70:1 2.50:1 2.50:1 3.85:1 1.05
30th June, 2003 3.55:1 2.35:1 2.75:1 4.30:1 1.05
30th September, 2003 3.10:1 1.90:1 3.00:1 4.90:1 1.05
31st December, 2003 2.85:1 1.80:1 3.20:1 5.30:1 1.05
31st March, 2004 2.75:1 1.65:1 3.40:1 5.70:1 1.05
30th June, 2004 2.45:1 1.40:1 3.65:1 6.00:1 1.05
30th September, 2004 2.05:1 1.05:1 3.90:1 6.00:1 1.05
31st December, 2004 2.00:1 1.00:1 4.00:1 6.00:1 1.05
31st March, 2005 2.00:1 1.00:1 4.00:1 6.00:1 1.05
30th June, 2005 2.00:1 1.00:1 4.00:1 6.00:1 1.05
30th September, 2005 2.00:1 1.00:1 4.00:1 6.00:1 1.05
31st December, 2005 2.00:1 1.00:1 4.00:1 6.00:1 1.05
31st March, 2006 2.00:1 1.00:1 4.00:1 6.00:1 1.05
30th June, 2006 2.00:1 1.00:1 4.00:1 6.00:1 1.05
30th September, 2006 2.00:1 1.00:1 4.00:1 6.00:1 1.05
31st December, 2006 2.00:1 1.00:1 4.00:1 6.00:1 1.05
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31st March, 2007 2.00:1 1.00:1 4.00:1 6.00:1 1.05
30th June, 2007 2.00:1 1.00:1 4.00:1 6.00:1 1.05
30th September, 2007 2.00:1 1.00:1 4.00:1 6.00:1 1.05
31st December, 2007 2.00:1 1.00:1 4.00:1 6.00:1 1.05
31st March, 2008 2.00:1 1.00:1 4.00:1 6.00:1 1.05
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SCHEDULE 2
CONDITIONS PRECEDENT DOCUMENTS
1. A copy of the constitutional documents of the Company or, if the
Facility Agent already has a copy, a certificate of an authorised
signatory of the Company confirming that the copy in the Facility
Agent's possession is still correct, complete and in full force and
effect as at a date no earlier than the date of this Agreement.
2. A copy of a resolution of the board of directors of the Company (or a
committee of its board of directors) approving the terms of, and the
transactions contemplated by, this Agreement.
3. If applicable, a copy of a resolution of the board of directors of the
Company establishing the committee referred to in paragraph 2 above.
4. A specimen of the signature of each person authorised on behalf of the
Company to sign this Agreement.
5. A certificate of an authorised signatory of the Company certifying that
each copy document specified in this Schedule is correct, complete and
in full force and effect as at a date no earlier than the date of this
Agreement.
6. A legal opinion of Xxxxx & Xxxxx, English legal advisers to the
Facility Agent, addressed to the Finance Parties.
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SIGNATORIES
COMPANY
ENODIS HOLDINGS LIMITED
By:
FACILITY AGENT
THE ROYAL BANK OF SCOTLAND plc
(for itself and as agent for and on behalf of each Finance Party)
By:
