EXHIBIT 10.28
WOLVERINE TUBE, INC.
WOLVERINE TUBE (CANADA) INC.
SEVENTH AMENDMENT AND LIMITED WAIVER TO CREDIT AGREEMENT AND
AMENDMENT TO SECURITY AGREEMENT
This SEVENTH AMENDMENT AND LIMITED WAIVER TO CREDIT AGREEMENT AND
AMENDMENT TO SECURITY AGREEMENT (this "AMENDMENT") is dated as of February 25,
2002 and entered into by and among, WOLVERINE TUBE INC., a Delaware corporation
(the "COMPANY"), WOLVERINE TUBE (CANADA) INC., an Ontario corporation
("WOLVERINE CANADA"; the Company and Wolverine Canada are each a "BORROWER" and
collectively, the "BORROWERS"), CREDIT SUISSE FIRST BOSTON, as administrative
agent (in such capacity, the "ADMINISTRATIVE AGENT"), the financial institutions
listed on the signature pages hereto (each individually referred to herein as a
"LENDER" and collectively, as "LENDERS") and solely for the purposes of Sections
2 and 3(a), the Subsidiary Guarantors, and is made with reference to that
certain Credit Agreement dated as of April 30, 1997, by and among the Borrowers,
the Lenders, the Administrative Agent and Mellon Bank, N.A., as the
Documentation Agent, as amended as of June 26, 1998, as of March 10, 1999, as of
June 30, 1999, as of May 31, 2000, August 8, 2001 and February 4, 2002 (such
Credit Agreement, as so amended, the "CREDIT AGREEMENT"), that certain Limited
Waiver dated as of February 4, 2002, among Borrowers, Administrative Agent and
the Lenders (the "WAIVER") and that certain Security Agreement dated as of
February 4, 2002, among Company, Subsidiary Guarantors and Administrative Agent.
Capitalized terms used herein without definition shall have the same meanings
herein as set forth in the Credit Agreement.
RECITALS
WHEREAS, Borrowers have requested an extension of the date by which the
Company must deliver certain monthly financial statements pursuant to subsection
1(b)(ii) of the Waiver and the Lenders have agreed to extend the time for such
delivery for a limited period on the terms and conditions set forth herein; and
WHEREAS, Lenders have agreed to permit certain Letters of Credit to
expire later than the Maturity Date, on the terms and conditions set forth
herein, including that Borrowers shall, on or before the Maturity Date, either
cause all such Letters of Credit to be replaced, cash collateralized in an
amount equal to 105% of the aggregate face amount thereof or supported by the
issuance to the Issuing Lender of a back-to-back letter of credit issued by a
financial institution acceptable to such Issuing Lender.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
LIMITED WAIVER
1.1 Waiver of Compliance with Waiver Covenants.
A. Subject to the terms and conditions set forth herein and in reliance
on the representations and warranties of the Borrowers herein contained, Lenders
hereby waive the
requirement set forth in subsection 1(b)(ii) of the Waiver to
deliver financial statements for the calendar month ending January 31, 2002 on
or before February 25, 2002 and for the calendar month ending February 28, 2002,
on or before March 25, 2002; provided, that such financial statements are
delivered as soon as possible and in any event (i) in the case of the financial
statements for the month ending January 31, 2002, no later than March 1, 2002
and (ii) in the case of the financial statements for the month ending February
28, 2002, no later than March 30, 2002.
B. Without limiting the generality of the provisions of subsection
10.6 of the Credit Agreement, the waivers set forth herein shall be limited
precisely as written and such waivers relate solely to the noncompliance by
Borrowers with the provisions of Section 1(b)(ii) of the Waiver in the manner
and to the extent described above, and nothing in this Amendment shall be deemed
to (a) constitute a waiver of compliance by Borrowers with respect to (i)
Section 1(b)(ii) of the Waiver in any other instance or (ii) any other term,
provision or condition of the Waiver, the Credit Agreement or any other
instrument or agreement referred to therein (whether in connection with this
waiver of Section 1(b)(ii) of the Waiver or otherwise) or (b) prejudice any
right or remedy that Administrative Agent or any Lender may now have (except to
the extent such right or remedy was based upon existing defaults that will not
exist after giving effect to this Amendment) or may have in the future under or
in connection with the Waiver or the Credit Agreement or any other instrument or
agreement referred to therein. Except as expressly set forth herein, the terms,
provisions and conditions of the Waiver shall remain in full force and effect
and in all other respects are hereby ratified and confirmed.
SECTION 2. AMENDMENTS TO THE CREDIT AGREEMENT AND THE SECURITY AGREEMENT
2.1 Amendments to Section 3: Letters of Credit.
A. Section 3.1A(iii) of the Credit Agreement is hereby amended by
adding at the end thereof the following proviso:
"; provided, further, that any Issuing Lender may, before the
Maturity Date, elect to (x) extend a Standby Letter of Credit
or such Letter of Credit may be automatically extended for an
additional period not to exceed one year, even if such
extension results in such Standby Letter of Credit having an
expiration date later than the Maturity Date or (y) replace
any existing Standby Letter of Credit with a Letter of Credit
having an expiration date within one year after the Maturity
Date, with a face amount not exceeding the face amount of such
Letter of Credit and otherwise having substantially similar
terms to the Letter of Credit being replaced"
B. Subsection 3.1 of the Credit Agreement is hereby further amended by
adding thereto the following new subsection 3.1D:
"D. AGREEMENT TO CASH COLLATERALIZE UNEXPIRED LETTERS OF
CREDIT FOLLOWING AN EVENT OF DEFAULT OR ON MATURITY DATE. Upon
the Maturity Date or following the occurrence and continuation
of an Event of Default, Company
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agrees to (i) secure a replacement letter of credit in order
to permit the cancellation of any unexpired Letter of Credit,
(ii) provide one or more standby letters of credit in form,
amount and substance satisfactory to the applicable Issuing
Lender and issued by a financial institution satisfactory to
the Issuing Lender in its absolute discretion, supporting the
payment obligations of the Issuing Lender under any unexpired
Letter of Credit or (iii) provide cash collateral in an amount
equal to 105% of the face amount of such unexpired Letter of
Credit and pursuant to arrangements satisfactory to such
Issuing Lender."
2.2 Amendments to Section 8: Events of Default.
A. Section 8 of the Credit Agreement is hereby amended by (i) deleting
the ";" at the end of subsection 8.13 thereof and substituting therefor "; or"
and (ii) adding the following new subsection 8.14:
"8.14 FAILURE TO COLLATERALIZE LETTERS OF CREDIT.
Failure by the Company to perform or comply with any term or
condition contained in subsection 3.1D of this Agreement;"
2.3 Acknowledgment.
For the purposes of clarification, Borrowers hereby acknowledge and
agree that the reference in Section 1(a) of the Waiver to the aggregate
principal amount of Indebtedness under the Credit Agreement at any time
outstanding shall be deemed to include the undrawn amount of any Letter of
Credit.
2.4 Amendment to Security Agreement and Acknowledgment of Grantors.
A. Section 2(a) of the Security Agreement is hereby amended by deleting
it in its entirety and substituting therefore the following:
"(a) (i) with respect to the Company, (x) all obligations and
liabilities of every nature of the Company hereafter existing
under or arising out of or in connection with the Credit
Agreement and the other Loan Documents with respect to any
Loans made or Letters of Credit issued on or after the date
hereof (but excluding any continuations or conversions of
Loans outstanding on the date hereof) and any other
obligations or liabilities arising out of or in connection
with the Credit Agreement on or after the date hereof and (y)
all obligations and liabilities of every nature of the Company
existing under or arising out of or in connection with any
Letter of Credit having an expiry date after the Maturity Date
and (ii) with respect to each Subsidiary Grantor and
Additional Grantor, (x) all obligations and liabilities of
every nature of such Grantors hereafter existing under or
arising out of or in connection with the Subsidiary Guaranty
with respect to any Loans made or Letters of Credit issued on
or after the date hereof (but excluding any continuations or
conversions of Loans outstanding on the date hereof) and any
other obligations or liabilities arising out of or in
connection with the Credit Agreement on or after the date
hereof and (y) all obligations
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and liabilities of every nature of such Grantors existing
under or arising out of or in connection with the Subsidiary
Guaranty with respect to any Letter of Credit having an expiry
date after the Maturity Date (collectively, the "CREDIT
AGREEMENT OBLIGATIONS"); and"
B. Each Grantor hereby affirms its grant of a security interest
pursuant to Section 2 of the Security Agreement to secure the Secured
Obligations and to the extent that such obligations are not secured by the
Security Agreement as in effect prior to the date hereof, hereby grants a
security interest on the terms set forth in Section 2 of the Security Agreement
to secure the Credit Agreement Obligations (as such term is amended hereby) and
the Secured Obligations.
SECTION 3. LOAN PARTIES' REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders to enter into this Amendment, each Loan
Party represents and warrants to the Lenders that the following statements are
true, correct and complete:
(a) Power and Authority. Each Loan Party has all requisite
power and authority to enter into this Amendment and to carry out the
transactions contemplated by this Amendment.
(b) Authorization of Amendment. The execution and delivery of
this Amendment and the performance of the Loan Parties hereunder has
been duly authorized by all necessary action on the part of each Loan
Party.
(c) No Conflict. The execution and delivery of this Amendment
by each Loan Party and the performance by such Loan Party of this
Amendment and the consummation of the transactions contemplated hereby
do not and will not (i) violate any provision of any law or any
governmental rule or regulation applicable to the Loan Parties or any
of their respective Subsidiaries, the Organizational Documents of the
Loan Parties or any of their respective Subsidiaries or any order,
judgment or decree of any court or other agency of government binding
on any of the Loan Parties or any of their respective Subsidiaries,
(ii) conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any material contract,
indenture, agreement or other instrument or document to which any Loan
Party or any of its Subsidiaries is a party or by which the properties
or assets of such Loan Party or its Subsidiaries are bound, (iii)
result in or require the creation or imposition of any Lien upon any of
the properties or assets of any Loan Party or any of its Subsidiaries
(other than Liens created under any of the Loan Documents in favor of
the Administrative Agent on behalf of the Lenders), or (iv) require any
approval of stockholders or any approval or consent of any Person under
any contract of any Loan Party or any of its Subsidiaries.
(d) Governmental Consents. The execution and delivery of this
Amendment by each Loan Party and the performance by such Loan Party of
this Amendment does not and will not require any registration with,
consent or approval of, or notice to, or other
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action to, with or by, any federal, state or other governmental
authority or regulatory body.
(e) Binding Obligation. This Amendment is the legally valid
and binding obligation of each Loan Party enforceable against each such
Loan Party in accordance with its terms, subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors generally and general principles of
equity.
(f) Incorporation of Representations and Warranties. The
representations and warranties contained in the Loan Documents are and
will be true, correct and complete in all material respects on and as
of the date hereof to the same extent as though made on and as of such
date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case they were true,
correct and complete in all material respects on and as of such earlier
date.
(g) Absence of Default. After giving effect to this Amendment
and the Limited Waiver, no Potential Event of Default or Event of
Default exists.
SECTION 4. ACKNOWLEDGMENT AND CONSENT
Each Subsidiary Guarantor acknowledges and agrees that (i)
notwithstanding the conditions to effectiveness set forth in this Amendment, the
consent of such Subsidiary Guarantor is not required by the terms of the Credit
Agreement or any other Loan Document and (ii) nothing in the Credit Agreement,
this Amendment or any other Loan Document shall be deemed to require the consent
of such Subsidiary Guarantor to any future amendments to or modifications of or
standstill agreements with respect to the Credit Agreement.
SECTION 5. ACKNOWLEDGMENT OF LENDERS
Upon the execution and delivery of a counterpart of this Agreement by
each Lender and satisfaction of the other conditions to effectiveness hereof, it
is hereby acknowledged and agreed that the letter of credit number S853857,
originally issued by Mellon Bank, N.A. in favor of Hartford Fire Insurance
Company which is in the face amount of $1,500,000 and which has been
automatically extended to have an expiration date of July 25, 2002 is a Letter
of Credit for all purposes under the Loan Documents and shall be deemed to be
issued and outstanding under the Credit Agreement.
SECTION 6. MISCELLANEOUS
(a) Reference to and Effect on the Credit Agreement and the
Other Loan Documents.
(i) On and after the date hereof, each reference in
the Credit Agreement to "this Agreement", "hereunder",
"hereof", "herein" or words of like import referring to the
Credit Agreement, and each reference in the other Loan
Documents to the "Credit Agreement", "thereunder", "thereof"
or words of like
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import referring to the Credit Agreement shall mean and be a
reference to the Credit Agreement as amended by this
Amendment.
(ii) Except as specifically amended by this
Amendment, the Credit Agreement and the other Loan Documents
shall remain in full force and effect and are hereby ratified
and confirmed.
(iii) The execution, delivery and performance of this
Amendment shall not, except as expressly provided herein,
constitute a waiver of any provision of, or operate as a
waiver of any right, power or remedy of Agent or any Lender
under, the Credit Agreement or any of the other Loan
Documents.
(b) Headings. Section and subsection headings in this
Amendment are included herein for convenience of reference only and
shall not constitute a part of this Amendment for any other purpose or
be given any substantive effect.
(c) Applicable Law. THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE
STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES.
(d) Counterparts; Effectiveness; Facsimile Signature Pages.
This 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 shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and
attached to a single counterpart so that all signature pages are
physically attached to the same document. This Amendment shall become
effective upon the execution of a counterpart hereof by Company,
Wolverine Canada, each Subsidiary Guarantor and Requisite Lenders and
receipt by Company and Agent of written or telephonic notification of
such execution and authorization of delivery thereof; provided, that
Section 2 hereof shall not become effective until each Lender --------
shall have executed a counterpart hereof and Company and Administrative
Agent have received written or telephonic notification of such
execution and authorization of delivery thereof; provided, further,
that Section 2.4 hereof shall not become effective until Company and
each Grantor shall have executed a counterpart hereof and Company and
Administrative Agent have received written or telephonic notification
of such execution and authorization of delivery thereof.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their duly authorized officers, all as of the day and year
first above written.
BORROWERS: WOLVERINE TUBE, INC.,
a Delaware corporation
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President, Chief Financial
Officer and Secretary
WOLVERINE TUBE (CANADA) INC.,
an Ontario corporation
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Secretary, Treasurer and Executive Vice
President
SUBSIDIARY GUARANTORS: TUBE FORMING L.P.,
a Delaware limited partnership
By: WOLVERINE TUBE, INC.
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President, Chief Financial
Officer and Secretary
SMALL TUBE MANUFACTURING CORP.,
a Delaware corporation
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
S-1
WOLVERINE FINANCE COMPANY,
a Tennessee corporation
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
WOLVERINE JOINING TECHNOLOGIES, INC.
a Delaware corporation
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
S-2
LENDERS:
CREDIT SUISSE FIRST BOSTON,
individually in its capacity as a Lender and in its
capacity as Administrative Agent
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: Director
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Director
MELLON BANK, N.A.,
By: /s/ Xxxx X. Xxxxxx
-----------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH,
as a Lender
By: /s/ Xxxxxx Xxx
-----------------------------------------
Name: Xxxxxx Xxx
Title: Senior Vice President
BANK OF AMERICA, N.A.,
f/k/a/ Bank of America National Trust and Savings
Association, (successor by merger to Bank of
America Illinois), successor by merger to Bank of
America, N.A., f/k/a/ NationsBank, N.A., (successor
by merger to NationsBank, N.A. (South)), as a Lender
By: /s/ Xxxxxxx X. XxXxxxxx
-----------------------------------------
Name: Xxxxxxx X. XxXxxxxx
Title: Managing Director
S-3
THE BANK OF NOVA SCOTIA,
as a Lender
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Managing Director
FIRST UNION NATIONAL BANK,
as a Lender
By: /s/ Xxxx Xxxxxxxx
-----------------------------------------
Name: Xxxx Xxxxxxxx
Title: V.P
SUNTRUST BANK,
(successor in interest to SunTrust Bank, Nashville,
N.A.), as a Lender
By: /s/ Xxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
S-4
