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EXHIBIT 10
GENERAL BINDING CORPORATION
THIRD AMENDMENT TO MULTICURRENCY CREDIT AGREEMENT
This Third Amendment to Multicurrency Credit Agreement (herein, the
"Amendment") is entered into as of March 31, 1999, between General Binding
Corporation, a Delaware corporation (the "Company"), each Borrowing Subsidiary
party to the Credit Agreement (as such term is defined below), each of the Banks
party to such Credit Agreement, Xxxxxx Trust and Savings Bank, as a Bank and in
its capacity as agent under the Credit Agreement (the "Administrative Agent")
and LaSalle National Bank, The First National Bank of Chicago, The Bank of New
York and Credit Agricole Indosuez, each as a Bank and in their respective
capacities as Co-Agents under the Credit Agreement.
PRELIMINARY STATEMENTS
A. The Company and the Banks entered into a certain Multicurrency
Credit Agreement, dated as of January 13, 1997 (as amended, the "Credit
Agreement"). All capitalized terms used herein without definition shall have the
same meanings herein as such terms have in the Credit Agreement.
B. The Company has requested that the Banks consent to an increase in
the Domestic Swing Line Commitment and the Multicurrency Swing Line Commitment,
amend certain covenants, add and amend certain definitions and make certain
other amendments to the Credit Agreement, and the Banks are willing to do so
under the terms and conditions set forth in this Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
SECTION 1. AMENDMENTS.
Subject to the satisfaction of the conditions precedent set forth in
Section 2 below, the Credit Agreement shall be and hereby is amended as follows:
(a) The definition of Eurocurrency Margin appearing in
Section 1.3(b) of the Credit Agreement is hereby amended in its
entirety and as so amended is restated to read as follows:
"Eurocurrency Margin" means (a) for each Eurocurrency Bid Loan
the percentage agreed to pursuant to Section 2.4 hereof and
(b) for each Committed Eurocurrency Loan, 1.150% per annum
from and including the Third Amendment Effective Date until
the next Pricing Date and thereafter from, and including, one
Pricing Date to, but not including, the next a rate per annum
determined in accordance with the following schedule:
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Level: Eurocurrency Margin:
Level I 0.525%
Level II 0.575%
Level III 0.625%
Level IV 0.825%
Level V 0.950%
Level VI 1.150%
Level VII 1.350%
Level VIII 1.375%
The Company acknowledges that a Leverage Ratio within
Level VIII constitutes an Event of Default.
(b) Section 5.2 of the Credit Agreement shall be amended
and restated in its entirety to read as follows:
"Section 5.2. Minimum Borrowing Amount. Each
Borrowing of Domestic Rate Loans (other than a Borrowing of
Domestic Swing Line Loans) shall be in an amount not less than
$3,000,000 and in integral multiples of $100,000. Each
Borrowing of Domestic Swing Line Loans shall be in a minimum
amount of $100,000. Each Borrowing of Eurocurrency Loans
(other than a Borrowing of Multicurrency Swing Line Loans)
shall be (x) if denominated in U.S. Dollars, in an amount not
less than $10,000,000 and in integral multiples of $100,000
and (y) if denominated in an Alternative Currency, in an
amount not less than an Original Dollar Amount of $5,000,000
and in integral multiples of 100,000 units of the relevant
currency. Each Borrowing of Multicurrency Swing Line Loans
shall be in an amount not less than an Original Dollar Amount
of $500,000. Each Borrowing of Bid Loans shall be in an amount
not less than an Original Dollar Amount of $3,000,000. There
is no requirement that Borrowings of Swing Line Loans or Bid
Loans which exceed such minimum amounts be in any particular
multiple."
(c) The following definitions appearing in Section 8 of the
Credit Agreement shall be amended in their entirety and as so amended
shall be restated to read as follows:
"Alternative Currency" means (i) any of Euros,
Belgian Francs, Deutsche Marks, Dutch Guilders, Japanese Yen,
Pounds Sterling, Spanish Pesetas, Australian Dollars, Canadian
Dollars, French Francs, Italian Lira, Swiss Francs, Austrian
Shillings, New Zealand Dollars, Singapore Dollars, Swedish
Krona, Irish Punts and Portuguese Escudos (collectively, the
"Designated Alternative Currencies") and (ii) any other
currency available to each Bank
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(each such other non-designated currency being hereinafter
referred to as an "Other Alternative Currency"), in each case
for so long as such Designated Alternative Currency and Other
Alternative Currency, as the case may be, is freely
transferable and freely convertible to U.S. Dollars and the
Dow Xxxxx Telerate Service or Reuters monitor Money Rates
Service (or any successor to either) reports a LIBOR for such
currency for interest periods of one, two, three and six
calendar months; provided, however, that availability of each
Other Alternative Currency is subject to the additional
conditions that (a) the Company has made written request on
the Administrative Agent to add such currency as an Other
Alternative Currency (the Administrative Agent to promptly
notify the Banks of each such request and the proposed
effective date of such currency's inclusion as an Other
Alternative Currency), (b) such currency shall, subject to the
other provisions of this definition, constitute an Other
Alternative Currency effective on the date ten (10) Business
Days following such notice by the Administrative Agent to the
Banks of the Company's request for such new currency, (c) such
amendments, modifications or supplements are made to this
Agreement as the Administrative Agent determines are necessary
or appropriate (if any) to give effect to the borrowing and
funding of Loans in such Other Alternative Currency and (d)
such additional currency shall no longer be available if any
of the Banks notifies the Administrative Agent that in the
judgment of such Bank, it is impossible, illegal or
impracticable for such Bank to make or participate in Loans in
such Other Alternative Currency or that in the judgment of
such Bank, additional costs or expenses will be incurred by
such Bank or additional taxes, charges or other impositions
will be imposed on such Bank (such as withholding taxes of the
type described in Section 17.1(a) hereof) as a result of
making or participating in Loans in such Other Alternative
Currency disbursed or payable in the United States or any
Approved Jurisdiction.
"Alternative Swing Line Currency" means any of Euros,
Deutsche Marks, Dutch Guilders, Pounds Sterling, French
Francs, Swiss Francs and Austrian Shillings, in each case for
so long as such currency constitutes an Alternative Currency;
provided, however, that availability of each Alternative Swing
Line Currency is subject to the additional conditions that (a)
the Multicurrency Swing Line Bank has not notified the
Administrative Agent that in the judgment of the Multicurrency
Swing Line Bank, it is impossible, illegal or impracticable
for such Bank to make Multicurrency Swing Line Loans in such
Alternative Swing Line Currency or that in the judgment of the
Multicurrency Swing Line Bank, additional costs or expenses
will be incurred by such Bank
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or additional taxes, charges or other impositions will be
imposed on such Bank (such as withholding taxes of the type
described in Section 17.1(a) hereof) as a result of making
Multicurrency Swing Line Loans in such Alternative Swing Line
Currency disbursed or payable in the United States or any
Approved Jurisdiction and (b) such amendments, modifications
or supplements are made to this Agreement as the
Administrative Agent and Multicurrency Swing Line Bank
determine are necessary or appropriate (if any) to give effect
to the borrowing and funding of Multicurrency Swing Line Loans
in such Alternative Swing Line Currency.
"Approved Jurisdictions" means Austria, Australia,
Belgium, Canada, Germany, Holland, the Republic of Ireland,
Italy, Japan, New Zealand, Singapore, Sweden, Portugal, Spain,
Switzerland and the United Kingdom and such other
jurisdictions as the Company requests from time to time in
writing; provided, however, that the addition of any Approved
Jurisdiction not specifically listed above in this sentence is
subject to the additional conditions that (a) the Company has
made written request on the Administrative Agent to add such
jurisdiction as an Approved Jurisdiction (the Administrative
Agent to promptly notify the Banks of each such request and
the proposed effective date of such jurisdiction's inclusion
as an Approved Jurisdiction), (b) such jurisdiction shall,
subject to the other provisions of this definition, constitute
an Approved Jurisdiction effective on the date ten (10)
Business Days following such notice by the Administrative
Agent to the Banks of the Company's request for such new
jurisdiction, (c) such amendments, modifications or
supplements are made to this Agreement as the Administrative
Agent determines are necessary or appropriate (if any) to give
effect to the addition of such Approved Jurisdiction and (d)
such additional jurisdiction shall no longer be an Approved
Jurisdiction if any of the Banks notifies the Administrative
Agent that in the judgment of such Bank, it is impossible,
illegal or impracticable for such Bank to make or participate
in Loans disbursed or payable in such Approved Jurisdiction or
that in the judgment of such Bank, additional costs or
expenses will be incurred by such Bank or additional taxes,
charges or other impositions will be imposed on such Bank
(such as withholding taxes of the type described in Section
17.1(a) hereof) as a result of making or participating in
Loans disbursed or payable in such Approved Jurisdiction.
"Business Day" means any day other than a Saturday or
Sunday on which banks are not authorized or required to close
in Chicago, Illinois and, if the applicable Business Day
relates to the borrowing or payment of a Eurocurrency Loan
denominated in
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U.S. Dollars, on which banks are dealing in U.S. Dollar
deposits or the relevant Alternative Currency in the interbank
market in London, England and, if the applicable Business Day
relates to the borrowing or payment of a Eurocurrency Loan
denominated in an Alternative Currency (other than Euros), on
which banks and foreign exchange markets are open for business
in the city where disbursements of or payments on such Loan
are to be made and, if the applicable Business Day relates to
the borrowing or payment of a Eurocurrency Loan denominated in
Euros, on which banks and foreign exchange markets are open
for business in the city where disbursements of or payments on
such Loan are to be made which is a TARGET Day.
"Consolidated EBITDA" means, for any period,
determined on a consolidated basis for the Company and its
Subsidiaries in accordance with GAAP, (i) earnings before
income taxes for such period, plus (ii) Consolidated Interest
Expense for such period, plus (iii) the amount of all
depreciation and amortization expense deducted in determining
earnings for such period, minus (iv) net earnings for such
period of any unconsolidated Person in which the Company or
any Subsidiary has an ownership interest, unless such earnings
are received in cash pursuant to a dividend distribution (or
equivalent distribution in the event of one made by a Person
other than a corporation) received by the Company, any
Borrower or any Guarantor, plus (v) net losses for such period
of any unconsolidated Person in which the Company or any
Subsidiary has an ownership interest to the extent such losses
are deducted in determining earnings for such period in an
amount in excess of any increase during such period in
Investments of the Company and its Subsidiaries in such
Person; provided, however, that notwithstanding anything in
this definition to the contrary: (a) non-cash gains and
non-cash losses on sales or other dispositions of assets of
the Company and its Subsidiaries outside the ordinary course
of their business shall be given no effect in determining
Consolidated EBITDA; and (b) if an Acquisition or Divestiture
occurs at any time during such period, Consolidated EBITDA
shall be calculated on a proforma basis to include (in the
case of an Acquisition) or exclude (in the case of a
Divestiture) earnings reasonably allocable to the acquired (or
divested) Person or business, as the case may be, for the
entire period as if such Acquisition or Divestiture had taken
place on the first day of such period, all as reasonably
calculated by the Company based on historical operations
(including, but not limited to, operations conducted during
such quarter) and reasonably calculated adjustments due to
anticipated operational changes. Notwithstanding anything
contained herein to the contrary, to the
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extent deducted in computing Consolidated EBITDA for any
period, the Fiscal Year 1999 Charges shall be added back to
each such computation of Consolidated EBITDA for the relevant
period.
"Domestic Swing Line Commitment" means $35,000,000,
as such amount may be reduced pursuant to Section 5.7 hereof.
"Leverage Ratio" means, as of any time the same is to
be determined, the ratio of (a) the amount (but in no event
less than $1) by which (i) Consolidated Debt at such time
exceeds (ii) the lesser of (A) the amount of Permitted Cash
Equivalents then on hand in excess of $7,000,000 or (B)
$18,000,000 to (b) Consolidated EBITDA for the four then most
recently completed fiscal quarters of the Company.
"Multicurrency Swing Line Commitment" means
$35,000,000, as such amount may be reduced pursuant to Section
5.7 hereof.
(d) Section 5.4 of the Credit Agreement shall be amended by
adding new subsections (d) and (e) at the end thereof which shall be
stated to read as follows:
"(d) Additional Mandatory Prepayment. If the
aggregate U.S. Dollar Equivalent or Original Dollar Amount of
outstanding Loans and L/C Obligations in each case denominated
in the same Alternative Currency less in each case the
aggregate amount cash held by the Administrative Agent in the
cash collateral account described in Section 5.4(e) below (to
the extent in excess of any amount so held as cash collateral
pursuant to Section 5.4(e) below with respect to any other
Alternative Currency) shall at any time for any reason exceed
the Foreign Currency Sub-Limit (if any) for such Alternative
Currency (any such excess being herein referred to as the
"Foreign Currency Excess"), the Company shall, within two (2)
Business Days, pay the amount of such Foreign Currency Excess
to the Administrative Agent for the ratable benefit of the
Banks as a prepayment of such Loans (to be applied to such
Loans as the Company shall direct at the time of such payment)
and, if necessary, a prefunding of such Letters of Credit.
Immediately upon determining the need to make any such
prepayment, the Company shall notify the Administrative Agent
of such required prepayment. Each such prepayment shall be
accompanied by a
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payment of all accrued and unpaid interest on the Loans
prepaid and shall be subject to Section 5.8.
(e) Cash Collateral Option. Notwithstanding the
foregoing, if and so long as no Default or Event of Default
has occurred and is continuing, if and to the extent a
mandatory prepayment required under this Section 5.4 would
otherwise be applied against any Eurocurrency Loan denominated
in an Alternative Currency, the Company may, in lieu of making
such prepayment, remit to the Administrative Agent an amount
in U.S. Dollars which is the then U.S. Dollar Equivalent of
such prepayment, which remittance shall be held in a cash
collateral account maintained by the Company with the
Administrative Agent (such account to be analogous to the
Account identified and defined in Section 13.4(b) hereof
except that the Administrative Agent shall purchase, on the
last day of the Interest Period then applicable to such
Eurocurrency Loan (or if earlier and the Administrative Agent
so elects, the first Business Day immediately following the
occurrence of any Default or Event of Default) the greatest
amount of Alternative Currency (but in no event greater than
the amount necessary to make such prepayment) which the
Administrative Agent can, in accordance with its normal
banking procedures, purchase (after any premium and costs of
exchange) with the cash so held in such cash collateral
account, for delivery on the date of such purchase and apply
the amount of Alternative Currency so purchased to reduce the
principal of such Eurocurrency Loan. Notwithstanding anything
herein to the contrary, to the extent the Company has so
provided cash collateral to the Administrative Agent in lieu
of making a prepayment required under Section 5.4(d) above on
a Eurocurrency Loan denominated in an Alternative Currency, if
at any time prior to the aforesaid conversion of such sum to
such Alternative Currency and the application of such sum in
reduction of such Eurocurrency Loan, the Administrative Agent
determines that no Foreign Currency Excess exists (whether by
virtue of exchange rate fluctuation or a payment on the
relevant Eurocurrency Loans), the Administrative Agent shall
release such cash from the cash collateral account upon the
Company's request to the extent that after giving effect to
such release, no Foreign Currency Excess, Default or Event of
Default would exist.
(e) The following definitions shall be added to Section 8 of
the Credit Agreement in the appropriate alphabetical locations:
"Divestiture" means any transaction or series of
related transactions, by which the Company or any of the
Subsidiaries
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sells or otherwise disposes of (i) any going business, line of
business or all or substantially all of the assets of any
Subsidiary or (ii) any Subsidiary.
"EMU" means economic and monetary union as
contemplated in the Treaty on European Union.
"EMU Commencement" means January 1, 1999 (the date of
commencement of the third stage of EMU).
"EMU Legislation" means legislative measures of the
European Council for the introduction of, changeover to or
operation of a single or unified European currency (whether
known as the "euro", "euros" or otherwise), being in part the
implementation of the third stage of EMU.
"Euro" means the single currency of Euro Members of
the European Union.
"Euro Member" means each state described as a
"participating member state" in any EMU Legislation.
"Euro Unit" means the currency unit of Euros.
"Fiscal Year 1999 Charges" means up to $7,500,000
attributable to those certain non-recurring non-cash charges
and up to $15,000,000 attributable to those certain
non-recurring cash charges, in each case incurred under the
expense reduction/restructuring program of the Company in the
relevant period during the Company's fiscal year ended
December 31, 1999. Any foregoing cash and non-cash charges not
classified as "restructuring charges" in accordance with GAAP
must be one-time expenses reasonably deemed to have been
incurred as a result of such expense reduction/restructuring
program, and such expenses must be reported by the Company in
reasonable detail in separate schedules accompanying the
Compliance Certificates required by Section 12.6 hereof for
each of the fiscal quarters in which such expenses are
incurred.
"Foreign Currency Sub-Limit" means $15,000,000 with
respect to New Zealand Dollars and $15,000,000 with respect to
Portuguese Escudos or any amount set by the Required Banks for
any Other Alternative Currency in a written notice from the
Administrative Agent to the Company.
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"Hedging Liability" means the liabilities of one or
more of the Borrowers or one or more of the Subsidiaries to
the Banks or any of them or to any of their Affiliates arising
in connection with any one or more interest rate swaps,
interest rate caps, interest rate collars or other interest
rate hedging arrangements from time to time entered into by
any Borrower or any Subsidiary with any Bank or any Affiliate
of any Bank. Unless and until the amount of the Hedging
Liability is fixed and determined, the Hedging Liability shall
be deemed to be the market value of the hedge from the date of
computation to the date the hedge expires.
"Net Equity Proceeds" means the proceeds received in
consideration of the issuance and sale of equity securities by
the Company or any Subsidiary, net of reasonable underwriting
discounts and commissions and other reasonable costs directly
incurred and payable as a result thereof.
"Permitted Cash Equivalents" means, to the extent
held in accounts within the United States: debt securities
which constitute direct obligations of any government,
commercial paper, certificates of deposit, banker's
acceptances, repurchase agreements with respect to government
securities and any other investments that would reasonably be
considered cash equivalents of like kind and nature.
"TARGET Day" means any day on which the
Trans-European Automated Realtime Gross Settlement Express
Transfer system is operating.
"Third Amendment Effective Date" means March 31,
1999.
"Treaty on European Union" means the Treaty of Rome
of March 25, 1957, as amended by the Single European Act of
1986 and the Maastricht Treaty (which was signed at Maastricht
on February 7, 1992, and came into force on November 1, 1993,
as amended from time to time).
"Year 2000 Problem" means any significant risk that
computer hardware, software, or equipment containing embedded
microchips essential to the business or operations of the
Company or any of its Subsidiaries will not, in the case of
dates or time periods occurring after December 31, 1999,
function at least as efficiently and reliably as in the case
of times or time periods occurring before January 1, 2000,
including the making of accurate leap year calculations.
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(f) Section 9 of the Credit Agreement shall be amended by
adding thereto a new Section 9.16 which reads as follows:
"Section 9.16. Year 2000 Compliance. The Company is
conducting a comprehensive review and assessment of all areas
within its and each of its Subsidiaries' business and
operations (including, to the extent the Company deems
appropriate, those areas affected by suppliers, vendors and
customers) reasonably expected to be affected by any defect in
computer software, data bases, hardware, controls and
peripherals related to the occurrence of the year 2000 or the
use at any time of any date which is before, on and after
December 31, 1999, in connection therewith. Based on the
foregoing review, assessment and inquiry, the Company believes
that no such defect could reasonably be expected to have a
Material Adverse Effect."
(g) Section 11.2(d) of the Credit Agreement shall be amended
by (i) deleting the reference to "and" appearing at the end of
subsection (iv) thereof, (ii) renumbering subsection (v) thereof to new
subsection (vi) and (iii) insert a new subsection (v) which shall be
stated to read as follows:
"(v) neither the Original Dollar Amount nor the U.S.
Dollar Equivalent of all Loans and L/C Obligations denominated
in an Alternative Currency and outstanding hereunder shall
exceed the Foreign Currency Sub-Limit (if any) for such
Alternative Currency,"
(h) Section 12.15 of the Credit Agreement shall be amended in
its entirety and as so amended shall be restated to read as follows:
"Section 12.15. Consolidated Shareholder's Equity.
The Company will, as of the close of each fiscal quarter of
the Company, maintain a Consolidated Shareholder's Equity of
not less than the Minimum Required Amount. For purposes of
this section, the "Minimum Required Amount" shall mean
$134,114,000 and shall increase (but not decrease) (x) as of
December 31, 1996 and each fiscal quarter thereafter, by an
amount equal to 50% of the cumulative positive Consolidated
Net Income earned for the fiscal quarter of the Company then
ended (but with each such fiscal quarter taken separately,
without reduction in the Minimum Required Amount for any
negative Consolidated Net Income for any fiscal quarter) and
(y) as of each issuance and sale of any equity securities by
the Company or any Subsidiary, by an amount equal to 80% of
the Net Equity Proceeds generated from such sale. For purposes
of this Section, Consolidated Shareholder's Equity shall be
determined exclusive
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of changes from and after September 30, 1996 in the foreign
currency translation adjustment under Financial Accounting
Standards Board Statement No. 52 as in effect from time to
time."
(i) Sections 12.17 and 12.18 of the Credit Agreement
shall be amended in their entirety to be and to read as follows:
"Section 12.17. Leverage Ratios. (a) Leverage Ratio.
The Company shall not, as of the close of any fiscal quarter
of the Company set forth below, permit the Leverage Ratio to
be more than the amount set forth to the right of such closing
date:
As of Close of Each Fiscal Quarter Ending During Period:
Leverage Ratio Shall
From and Including To and Including Not be More Than:
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1st fiscal quarter of 4th fiscal quarter of 5.00 to 1
fiscal year 1999 fiscal year 1999
1st fiscal quarter of 4th fiscal quarter of 4.50 to 1
fiscal year 2000 fiscal year 2000
1st fiscal quarter of each fiscal quarter 4.25 to 1
fiscal year 2001 thereafter
(b) Senior Leverage Ratio. The Company shall not, as
of the close of any fiscal quarter of the Company set forth
below, permit the Senior Leverage Ratio to be more than the
amount set forth to the right of such closing date:
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As of Close of Each Fiscal Quarter Ending During Period:
Leverage Ratio Shall
From and Including To and Including Not be More Than:
------------------ ---------------- -----------------
1st fiscal quarter of 4th fiscal quarter of 3.75 to 1
fiscal year 1999 fiscal year 1999
1st fiscal quarter of 4th fiscal quarter of 3.25 to 1
fiscal year 2000 fiscal year 2000
1st fiscal quarter each fiscal quarter 3.00 to 1
of fiscal year 2001 thereafter
Section 12.18. Interest Coverage Ratio. The Company
shall not, as of the close of any fiscal quarter of the
Company set forth below, permit the Interest Coverage Ratio to
be less than the amount set forth to the right of such closing
date:
As of Close of each Fiscal Quarter Ending During Period:
Interest Coverage Ratio
Shall
From and Including To and Including Not be Less Than:
------------------ ---------------- -----------------
1st fiscal quarter of 4th fiscal quarter of 2.50 to 1
fiscal year 1999 fiscal
year 2000
1st fiscal quarter of each fiscal quarter 2.75 to 1
fiscal year 2001 thereafter
(j) Section 12 of the Credit Agreement shall be amended by
adding thereto new Sections 12.25 and 12.26 which shall read as
follows:
"Section 12.25. Year 2000 Assessment. The Company
shall complete on a timely basis the review and assessment of
its business and operations referred to in Section 9.16 hereof
and use reasonable efforts to assure that its computer-based
and other systems (and those of all Subsidiaries) are able to
effectively process dates, including dates before, on and
after January 1, 2000, without experiencing any Year 2000
Problem that could
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reasonably be expected to cause a Material Adverse Effect. At
the request of the Administrative Agent, the Company will
provide the Administrative Agent with such written reports and
information (including, but not limited to, the results of
internal or external audit reports prepared in the ordinary
course of business) reasonably acceptable to the
Administrative Agent as to the capability of the Company and
its Subsidiaries to conduct its and their businesses and
operations before, on and after January 1, 2000, without
experiencing a Year 2000 Problem causing a Material Adverse
Effect.
Section 12.26. European Monetary Union. (a) If, as a
result of the EMU Commencement, (i) any Alternative Currency
ceases to be lawful currency of the state issuing the same and
is replaced by Euros or (ii) any Alternative Currency and
Euros are at the same time both recognized by the central bank
or comparable governmental authority of the state issuing such
currency as lawful currency of such state, then any amount
payable hereunder by any party hereto in such Alternative
Currency (including, without limitation, any Loan to be made
under this Agreement) shall instead be payable in Euros and
the amount so payable shall be determined by redenominating or
converting such amount into Euros at the exchange rate
officially fixed by the European Central Bank for the purpose
of implementing the EMU, provided, that to the extent any EMU
Legislation provides that an amount denominated either in
Euros or in the applicable Alternative Currency can be paid
either in Euros or in the applicable Alternative Currency,
each party to this Agreement shall be entitled to pay or repay
such amount in Euros or in the applicable Alternative
Currency. Prior to the occurrence of the event or events
described in clause (i) or (ii) of the preceding sentence,
each amount payable hereunder in any such Alternative Currency
will, except as otherwise provided herein, continue to be
payable only in that Alternative Currency.
(b) The Company (acting on behalf of the Borrowers)
shall from time to time, at the request of the Administrative
Agent, pay to the Administrative Agent for the account of each
Bank the amount of any cost or increased cost incurred by, or
of any reduction in any amount payable to or in the effective
return on its capital to, or of interest or other return
foregone by, such Bank or any holding company of such Bank as
a result of the introduction of, changeover to or operation of
Euros in any applicable state to the extent reasonably
attributable to such Bank's obligations hereunder or for the
credit which is the subject matter hereof; provided, however,
that (a) such Bank shall promptly notify the
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Company of an event which might cause it to seek compensation,
and the Company shall be obligated to pay only such
compensation which is incurred or which arises after the date
ninety (90) days prior to the date such notice is given and
(b) such Bank shall not be entitled to make such a claim for
compensation if the Bank has not generally been making claims
for compensation under similar circumstances from other
borrowers similarly situated under loan agreements with
provisions comparable to this Section entitling the Bank to
make such a claim. In the event any circumstance arises by
virtue of which a Bank is determined to be entitled to a
refund for any amount or amounts which were paid or reimbursed
by the Company to such Bank hereunder, such Bank shall refund
such amount or amounts to the Company without interest. Each
Bank that determines to seek compensation under this Section
12.26(b) shall notify the Company and the Administrative Agent
of the circumstances that entitle the Bank to such
compensation pursuant to this Section 12.26(b) and will
designate a different Lending Office if such designation will
avoid the need for, or reduce the amount of, such compensation
and will not, in the judgment of such Bank, be otherwise
impractical or disadvantageous in any material respect to such
Bank. A certificate of any Bank claiming compensation under
this Section 12.26(b) and setting forth the additional amount
or amounts to be paid to it hereunder shall be conclusive in
the absence of demonstrable error. In determining such amount,
such Bank may use any reasonable averaging and attribution
methods. The protection of this Section 12.26(b) shall be
available to each Bank regardless of any possible contention
of the invalidity or inapplicability of any law, regulation or
other condition which shall give rise to any demand by such
Bank for compensation.
(c) With respect to the payment of any amount
denominated in Euros or in any Alternative Currency, the
Administrative Agent shall not be liable to the Company
(acting on behalf of the Borrowers) or any of the Banks in any
way whatsoever for any delay, or the consequences of any
delay, in the crediting to any account of any amount required
by this Agreement to be paid by the Administrative Agent if
the Administrative Agent shall have taken all relevant steps
to achieve, on the date required by this Agreement, the
payment of such amount in immediately available, freely
transferable, cleared funds (in the Euro Unit or, as the case
may be, in any Alternative Currency) to the account with the
bank in the principal financial center in the Euro Member
which the Company (acting on behalf of the Borrowers) or, as
the case may be, any Bank shall have specified for such
purpose. In this paragraph (c), "all relevant steps" means all
such steps as may
-14-
15
be prescribed from time to time by the regulations or
operating procedures of such clearing or settlement system as
the Administrative Agent may from time to time determine for
the purpose of clearing or settling payments of Euros.
(d) If the basis of accrual of interest or fees
expressed in this Agreement with respect to the currency of
any state that becomes a Euro Member shall be inconsistent
with any convention or practice in the London interbank market
for the basis of accrual of interest or fees in respect of
Euros, such convention or practice shall replace such
expressed basis effective as of and from the date on which
such state becomes a Euro Member; provided, that if any Loan
in the currency of such state is outstanding immediately prior
to such date, such replacement shall take effect, with respect
to such Loan, at the end of the then current Interest Period.
(e) In addition, the Company (acting on behalf of the
Borrowers) and the Administrative Agent shall enter into
negotiations in good faith, if and to the extent necessary, to
amend this Agreement (including, without limitation, the
definition of Eurocurrency Loan) to reflect such EMU
Commencement and change in currency and to put the Banks and
the Borrowers in the same position, so far as possible, that
they would have been in if such implementation and change in
currency had not occurred. The parties hereto acknowledge and
agree that if, within sixty (60) days of the commencement of
such negotiations, the Company (acting on behalf of the
Borrowers) and the Administrative Agent fail to reach
agreement regarding any such amendments, then the provisions
of Section 14.2 hereof shall be deemed operative and, until
such an agreement is reached, the obligations of the Banks to
make Eurocurrency Loans in Euros or any other Alternative
Currency issued by a Euro Member shall be suspended. Except as
provided in the foregoing provisions of this Section 12.26, no
such implementation or change in currency nor any economic
consequences resulting therefrom shall (i) give rise to any
right to terminate prematurely, contest, cancel, rescind,
alter, modify or renegotiate the provisions of this Agreement
or (ii) discharge, excuse or otherwise affect the performance
of any obligations of the Borrowers under this Agreement, any
Notes or any other Loan Documents."
(k) Section 16.1 of the Credit Agreement shall be amended in
its entirety and as so amended shall be restated to read as follows:
"Section 16.1. The Guarantees. To induce the Banks to
provide the credits described herein and in consideration of
-15-
16
benefits expected to accrue to each Guarantor by reason of the
Commitments and for other good and valuable consideration,
receipt of which is hereby acknowledged, each Guarantor hereby
unconditionally, irrevocably and jointly and severally
guarantees to each Agent, the Banks, and each other holder of
an obligation hereby guaranteed, the due and punctual payment
of (i) all present and future indebtedness of the Borrowers
and any one or more of them evidenced by or arising out of the
Credit Documents, including, but not limited to, the due and
punctual payment of principal of and interest on the Notes and
the due and punctual payment of all other Obligations now or
hereafter owed by the Borrowers and any one or more of them
under the Credit Documents as and when the same shall become
due and payable, whether at stated maturity, by acceleration
or otherwise, according to the terms hereof and thereof and
(ii) any Hedging Liability. If any Borrower or Guarantor fails
to pay punctually any indebtedness or other obligations
guaranteed hereby, each Guarantor hereby unconditionally
agrees jointly and severally to make such payment or to cause
such payment to be made punctually as and when the same shall
become due and payable, whether at stated maturity, by
acceleration or otherwise, and as if such payment were made by
such Borrower or Guarantor."
(l) Exhibit C to the Credit Agreement shall be and hereby is
amended and as so amended shall be restated in its entirety to read as
set forth on Schedule One hereto.
(m) Schedule 9.2 of the Credit Agreement shall be and hereby
is amended and as so amended shall read as set forth on Schedule Two
attached hereto.
SECTION 2. CONDITIONS PRECEDENT.
The effectiveness of this Amendment is subject to the satisfaction of
all of the following conditions precedent:
(a) Each Borrower, each Guarantor and the Required Banks
shall have executed and delivered this Amendment.
(b) The Administrative Agent shall have received a new
promissory note from the Company and each Borrowing Subsidiary for the
Domestic Swing Line Bank in the form contemplated by the Credit
Agreement after giving effect to this amendment.
(c) All legal matters with respect to this Amendment have
been resolved in a manner reasonably satisfactory to the Administrative
Agent.
Upon the satisfaction of such conditions precedent, this Amendment shall be
effective as of the Third Amendment Effective Date.
-16-
17
SECTION 3. REPRESENTATIONS.
In order to induce the Banks to execute and deliver this Amendment, the
Company hereby represents to each Bank that as of the date hereof, after giving
effect to this Amendment, the representations and warranties set forth in
Section 9 of the Credit Agreement are and shall be and remain true and correct
(except that the representations contained in Section 9.4 shall be deemed to
refer to the most recent financial statements of the Company delivered to the
Administrative Agent) and the Company is in full compliance with all of the
terms and conditions of the Credit Agreement and no Default or Event of Default
has occurred and is continuing under the Credit Agreement.
SECTION 4. MISCELLANEOUS.
(a) Except as specifically amended herein or waived hereby, the Credit
Agreement shall continue in full force and effect in accordance with its
original terms. Reference to this specific Amendment need not be made in the
Credit Agreement, the Notes, or any other instrument or document executed in
connection therewith, or in any certificate, letter or communication issued or
made pursuant to or with respect to the Credit Agreement, any reference in any
of such items to the Credit Agreement being sufficient to refer to the Credit
Agreement as amended hereby.
(b) By executing this Amendment in the place provided for that purpose
below, each Guarantor hereby consents to the Amendment to the Credit Agreement
as set forth herein and confirms that its obligations thereunder remain in full
force and effect. Each Guarantor further agrees that the consent of such
Guarantor to any further amendments to the Credit Agreement shall not be
required as a result of this consent having been obtained.
(c) The Company agrees to pay on demand all reasonable costs and
expenses of or incurred by the Administrative Agent in connection with the
negotiation, preparation, execution and delivery of this Amendment, as and to
the extent provided in Section 17.15 of the Credit Agreement.
(d) This Amendment may be executed in any number of counterparts, and
by the different parties on different counterpart signature pages, all of which
taken together shall constitute one and the same agreement. Any of the parties
hereto may execute this Amendment by signing any such counterpart and each of
such counterparts shall for all purposes be deemed to be an original. This
Amendment shall be governed by the internal laws of the State of Illinois.
[SIGNATURE PAGES TO FOLLOW]
-17-
18
GENERAL BINDING CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx, Xx.
-----------------------------------
Title: Vice President
----------------------------------
GBC INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx, Xx.
-----------------------------------
Title: Vice President
----------------------------------
VELOBIND, INCORPORATED
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx, Xx.
-----------------------------------
Title: Vice President
----------------------------------
GBC GENERAL BINDING (NEDERLAND) B.V.
By:GENERAL BINDING CORPORATION
Its: Attorney-in-Fact
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
-------------------------------
Name: Xxxxxxx X. Xxxxxxxx, Xx.
-----------------------------
Title: Vice President
-----------------------------
GBC INDIA HOLDINGS INC.
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx, Xx.
-----------------------------------
Title: Vice President
----------------------------------
Accepted and agreed to as of the date and year last above written.
XXXXXX TRUST AND SAVINGS BANK, in its
individual capacity as a Bank and as
Administrative Agent
By: /s/ Xxxxxxx Xxxxxxxx
-------------------------------------
Name: Xxxxxxx Xxxxxxxx
-----------------------------------
Title: Managing Director
----------------------------------
-18-
19
LASALLE NATIONAL BANK, in its individual
capacity as a Bank and as Co-Agent
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
--------------------------------------
Title: First Vice President
-------------------------------------
THE FIRST NATIONAL BANK OF CHICAGO, in its
individual capacity as a Bank, as Co-
Syndication Agent and as Co-Agent
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
--------------------------------------
Title: Vice President
-------------------------------------
THE BANK OF NEW YORK, in its individual
capacity as a Bank and as Co-Agent
By: /s/ Xxxx Xxxx Xxxxxxx
----------------------------------------
Name: Xxxx Xxxx Xxxxxxx
--------------------------------------
Title: Vice President
-------------------------------------
CREDIT AGRICOLE INDOSUEZ
By: /s/ Xxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxx X. Xxxxxxxx
--------------------------------------
Title: Vice President
-------------------------------------
By: /s/ Xxxxxxx X. Xxxxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
--------------------------------------
Title: Vice President, Manager
-------------------------------------
COMERICA BANK
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
--------------------------------------
Title: Vice President
-------------------------------------
-19-
20
THE BANK OF TOKYO-MITSUBISHI, LTD.,
CHICAGO BRANCH
By: /s/ Xxxxxxx Xxxxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxxxx
-----------------------------------
Title: Deputy General Manager
----------------------------------
SUNTRUST BANK, ATLANTA
By: /s/ Xxxxxxx X. Pick
--------------------------------------
Name: Xxxxxxx X. Pick
------------------------------------
Title: Vice President
------------------------------------
By: /s/ Xxxxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxxxx X. Xxxxxxx
------------------------------------
Title: Vice President
------------------------------------
MERCANTILE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name: Xxxxxx X. Xxxx
------------------------------------
Title: Assistant Vice President
------------------------------------
FIRST UNION NATIONAL BANK (formerly
known as First Union National Bank of
North Carolina)
By: /s/ C. Xxxxxxx Xxxxxx
--------------------------------------
Name: C. Xxxxxxx Xxxxxx
------------------------------------
Title: Senior Vice President
------------------------------------
NATIONAL CITY BANK
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
------------------------------------
Title: Vice President
------------------------------------
-20-
21
CREDIT LYONNAIS CHICAGO BRANCH
By:
---------------------------------------
Name:
-------------------------------------
Title:
-------------------------------------
THE BANK OF NOVA SCOTIA
By: /s/ F.C.H. Xxxxx
--------------------------------------
Name: F.C.H. Xxxxx
-------------------------------------
Title: Senior Manager Loan Operations
-------------------------------------
SOCIETE GENERALE CHICAGO BRANCH
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxxx
-------------------------------------
Title: Director
-------------------------------------
THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxx
-------------------------------------
Title: Executive Vice President
-------------------------------------
CIBC, INC.
By: /s/ Xxxx Xxxxxxxx
---------------------------------------
Name: Xxxx Xxxxxxxx
-------------------------------------
Title: Executive Director
-------------------------------------
BANKERS TRUST COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxxx
-------------------------------------
Title: Assistant Vice President
-------------------------------------
-21-
22
THE SANWA BANK, LIMITED, CHICAGO BRANCH
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxx
------------------------------------
Title: Vice President and Manager
-----------------------------------
-22-
23
SCHEDULE ONE
EXHIBIT C
DOMESTIC SWING LINE NOTE
$__________________ March ___, 1999
FOR VALUE RECEIVED, the undersigned, [General Binding Corporation]
[Borrowing Subsidiary], a ____________ corporation (the "Borrower"), promises to
pay to the order of Xxxxxx Trust and Savings Bank (the "Bank") on the Revolving
Credit Termination Date of the hereinafter defined Credit Agreement, at the
principal office of Xxxxxx Trust and Savings Bank, in Chicago, Illinois, the
principal sum of (i) _________________________________________
($______________________), or (ii) such lesser amount as may at the time of the
maturity hereof, whether by acceleration or otherwise, be the aggregate unpaid
principal amount of all Domestic Swing Line Loans owing from the Borrower to the
Bank under the Domestic Swing Line Commitment provided for in the Credit
Agreement.
The Bank shall record on its books or records or on a schedule attached
to this Domestic Swing Line Note, which is a part hereof, each Domestic Swing
Line Loan made by it pursuant to the Credit Agreement, together with all
payments of principal and interest and the principal balances from time to time
outstanding hereon and the interest rates and Interest Period applicable
thereto, provided that prior to the transfer of this Domestic Swing Line Note
all such amounts, interest rates and Interest Periods shall be recorded on a
schedule attached to this Domestic Swing Line Note. The record thereof, whether
shown on such books or records or on a schedule to this Domestic Swing Line
Note, shall be prima facie evidence of the same; provided, however, that the
failure of the Bank to record any of the foregoing or any error in any such
record shall not limit or otherwise affect the obligation of the Borrower to
repay all Domestic Swing Line Loans made to it pursuant to the Credit Agreement
together with accrued interest thereon.
This Domestic Swing Line Note is one of the Domestic Swing Line Notes
referred to in the Credit Agreement dated as of January 13, 1997, among General
Binding Corporation, Xxxxxx Trust and Savings Bank, as Administrative Agent, and
the Banks party thereto (as amended, the "Credit Agreement"), and this Domestic
Swing Line Note and the holder hereof are entitled to all the benefits provided
for thereby or referred to therein, to which Credit Agreement reference is
hereby made for a statement thereof. All defined terms used in this Domestic
Swing Line Note, except terms otherwise defined herein, shall have the same
meaning as in the Credit Agreement. This Domestic Swing Line Note shall be
governed by and construed in accordance with the internal laws of the State of
Illinois.
Prepayments may be made hereon and this Domestic Swing Line Note may be
declared due prior to the expressed maturity hereof, all in the events, on the
terms and in the manner as provided for in the Credit Agreement.
24
The Borrower hereby waives demand, presentment, protest or notice of
any kind hereunder.
[GENERAL BINDING CORPORATION]
[BORROWING SUBSIDIARY]
By
Its________________________________
-2-
25
SCHEDULE TWO
SCHEDULE 9.2
LIST OF SUBSIDIARIES
Owned Percent Jurisdiction of
Investment By Ownership Organization
---------- ----- --------- ---------------
Allfax UK, Ltd. Ibico Limited 000 Xxxxxx Xxxxxxx
Allfax Paper Products, Ltd. Ibico Limited 000 Xxxxxx Xxxxxxx
Anillos Plasticos de Mexico S.A. General Binding Corporation 100 Mexico
Compania Papelera Xxxxx X.X. Grupo GBC S.A. de C.V. 96.44 Mexico
General Binding Corporation 1.78
GBC International, Inc. 0.89
VeloBind, Incorporated 0.89
Xxxxxxxxx de Mexico S.A. GBC Mexicana S.A. de C.V. 100 Mexico
*GBC Australia Pty. Ltd. GBC International, Inc. 000 Xxxxxxxxx
GBC Handelsgesellschaft M.b.h. GBC International, Inc. 000 Xxxxxxx
GBC General Binding (Belgie) N.V. GBC Xxxxxxxxx X.X. 000 Xxxxxxx
*GBC Canada, Inc. GBC International, Inc. 000 Xxxxxx
GBC Deutschland GmbH General Binding Corporation 100 Germany
*GBC/Fordigraph Pty. Ltd. GBC Australia Pty. Ltd. 000 Xxxxxxxxx
GBC France S.A. GBC Xxxxxxx X.X. 000 Xxxxxx
GBC India Holdings Corp. GBC International, Inc. 100 Nevada
--------------------
* Denotes Significant Subsidiary
26
Owned Percent Jurisdiction of
Investment By Ownership Organization
---------- ----- --------- ---------------
GBC International Export Sales Corp. GBC International, Inc. 100 Barbados
*GBC International, Inc. General Binding Corporation 100 Nevada
GBC International Services S.P.R.L. GBC International, Inc. 99 Belgium
General Binding Corporation 1
*GBC Japan K.K. GBC International, Inc. 000 Xxxxx
GBC Mexicana S.A. de C.V. Grupo GBC S.A. de C.V. 96.44 Mexico
General Binding Corporation 1.78
GBC International, Inc. 0.89
VeloBind, Incorporated 0.89
*GBC Nederland B.V. GBC International, Inc. 000 Xxxxxxxxxxx
GBC New Zealand Ltd. GBC Australia Pty. Ltd. 100 New Zealand
GBC Poland GBC International, Inc. 98.75 Poland
General Binding Italia S.p.A. 1.25
GBC Sales & Services GBC International, Inc. 000 Xxxxxx
GBC Schweiz A.G. GBC International, Inc. 100 Switzerland
GBC Services PTY Ltd. GBC Australia PTY Ltd. 000 Xxxxxxxxx
GBC Singapore Pte. Ltd. GBC International, Inc. 100 Singapore
*GBC United Kingdom Holdings, Ltd. GBC International, Inc. 98.18 United Kingdom
General Binding Corporation 1.82
*GBC United Kingdom, Ltd. Ibico Limited 000 Xxxxxx Xxxxxxx
*General Binding Italia S.p.A. Ibico Italia S.r.l. 000 Xxxxx
Grupo GBC S.A. de C.V. General Binding Corporation 58.972 Mexico
GBC International, Inc. 20.517
VeloBind, Incorporated 20.511
Ibico AG GBC International, Inc. 000 Xxxxxxxxxxx
-0-
00
Owned Percent Jurisdiction of
Investment By Ownership Organization
---------- ----- --------- ---------------
Ibico Canada Inc. GBC International, Inc. 100 Canada
Ibico Chile S.A. Xxxxx XxxX 000 Xxxxx
Xxxxx Xxxxxxxxxxx XxxX Xxxxx GmbH 100 Germany
Ibico France S.A. Xxxxx XxxX 000 Xxxxxx
*Ibico GmbH GBC International, Inc. 000 Xxxxxxxxxxx
Xxxxx Xxxxxxxx Xxxxxxxxx Pte. Ibico GmbH 100 Singapore
Ltd.
Ibico Iberia, S.A. Xxxxx XxxX 000 Xxxxx
Xxxxx Xxxxxx S.r.l. GBC International, Inc. 99.555 Italy
Ibico GmbH 0.348
General Binding Corporation 0.097
Ibico Limited GBC United Kingdom 94.01 United Kingdom
Holdings, Ltd.
Ibico GmbH 5.99
Ibico Portuguesa Lda. Xxxxx XxxX 000 Xxxxxxxx
Xxxxx Scandinavia AB Xxxxx XxxX 000 Xxxxxx
Xxxxx Singapore Pte. Ltd. Ibico Holdings Singapore Pte. Ltd. 100 Singapore
Ibico Trading GmbH Xxxxx XxxX 000 Xxxxxxxxxxx
InterBinding GmbH Ibico GmbH 100 Germany
Mirabeau Contract Sales, Ltd. Ibico Limited 000 Xxxxxx Xxxxxxx
PBB&R S.A de C.V. GBC International, Inc. 97 Mexico
General Binding Corporation 2
VeloBind, Incorporated 1
Plastic Binding Corporation General Binding Corporation 100 Illinois
-3-
28
Owned Percent Jurisdiction of
Investment By Ownership Organization
---------- ----- --------- ---------------
Printing Wire Supplies Limited GBC International, Inc. 100 Ireland
Quartet Manufacturing (1997) Inc. GBC Canada, Inc. 100 Canada
*VeloBind, Incorporated General Binding Corporation 100 Delaware
-4-
