EXHIBIT 10.47.4
FOURTH AMENDMENT TO CREDIT AGREEMENT
THIS FOURTH AMENDMENT TO CREDIT AGREEMENT ("Amendment") is
entered into as of September 26, 2001, by and among WESTERN DIGITAL
TECHNOLOGIES, INC., a Delaware corporation formerly known as Western Digital
Corporation ("Borrower"), the other Credit Parties party hereto, the lenders
signatory hereto (each individually a "Lender" and collectively the "Lenders"),
GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation, as administrative
agent for Lenders (in such capacity, "Agent"), and BANK OF AMERICA, N.A., as
documentation agent for Lenders ("Documentation Agent"; Agent and Documentation
Agent are collectively referred to as "Co-Agents" and each, a "Co-Agent").
RECITALS
A. Borrower, the other Credit Parties party thereto, Lenders, and
Co-Agents have entered into the Credit Agreement dated as of September 20, 2000,
as amended by the First Amendment to Credit Agreement dated as of March 8, 2001,
the Second Amendment to Credit Agreement dated as of March 23, 2001, and the
Third Amendment to Credit Agreement dated as of April 7, 2001 (collectively,
"Credit Agreement"), pursuant to which Co-Agents and Lenders are providing
financial accommodations to or for the benefit of Borrower upon the terms and
conditions contained therein. Unless otherwise defined herein, capitalized terms
or matters of construction defined or established in Annex A to the Credit
Agreement shall be applied herein as defined or established therein.
B. Borrower has requested in the letter attached hereto as Appendix A
that Co-Agent and Lenders make certain amendments to the Credit Agreement and
other Loan Documents, and Co-Agent and Lenders are willing to do so subject to
the terms and conditions of this Amendment.
AGREEMENT
NOW, THEREFORE, in consideration of the continued performance by
Borrower and each other Credit Party of their respective promises and
obligations under the Credit Agreement and the other Loan Documents, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Borrower, the other Credit Parties signatory hereto,
Lenders, and Co-Agents hereby agree as follows:
1. Ratification and Incorporation of Credit Agreement. Except as
expressly modified under this Amendment, (a) each Credit Party hereby
acknowledges, confirms, and ratifies all of the terms and conditions set forth
in, and all of its obligations under, the Credit Agreement, and (b) all of the
terms and conditions set forth in the Credit Agreement are incorporated herein
by this reference as if set forth in full herein.
2. Amendments to Credit Agreement and Other Loan Documents. The
Credit Agreement and other Loan Documents are hereby amended as follows:
(a) The definition of each of the following terms in
Annex A to the Credit Agreement is hereby deleted in its entirety and replaced
with the new definition for such term set forth below:
"Account Debtor" means any Person who may become
obligated to any other Person under, with respect to, or on account of,
an Account, Chattel Paper or General Intangible (including a payment
intangible).
"Accounts" means all "accounts," as such term is
defined in the Code, now owned or hereafter acquired by any Person,
including (a) all accounts receivable, other
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receivables, book debts and other forms of obligations (other than forms
of obligations evidenced by Chattel Paper, or Instruments), (including
any such obligations that may be characterized as an account or contract
right under the Code), (b) all of each Person's rights in, to and under
all purchase orders or receipts for goods or services, (c) all of each
Person's rights to any goods represented by any of the foregoing
(including unpaid sellers' rights of rescission, replevin, reclamation
and stoppage in transit and rights to returned, reclaimed or repossessed
goods), (d) all rights to payment due to any Person for property sold,
leased, licensed, assigned or otherwise disposed of, for a policy of
insurance issued or to be issued, for a secondary obligation incurred or
to be incurred, for energy provided or to be provided, for the use or
hire of a vessel under a charter or other contract, arising out of the
use of a credit card or charge card, or for services rendered or to be
rendered by such Credit Party or in connection with any other
transaction (whether or not yet earned by performance on the part of
such Credit Party), (e) all health-care-insurance receivables and (f)
all collateral security of any kind, given by any Account Debtor or any
other Person with respect to any of the foregoing.
"Equipment" means all "equipment," as such term
is defined in the Code, now owned or hereafter acquired by any Person,
wherever located and, in any event, including all such Person's
machinery and equipment, including processing equipment, conveyors,
machine tools, data processing and computer equipment, including
embedded software and peripheral equipment and all engineering,
processing and manufacturing equipment, office machinery, furniture,
materials handling equipment, tools, attachments, accessories,
automotive equipment, trailers, trucks, forklifts, molds, dies, stamps,
motor vehicles, rolling stock and other equipment of every kind and
nature, trade fixtures and fixtures not forming a part of real property,
together with all additions and accessions thereto, replacements
therefor, all parts therefor, all substitutes for any of the foregoing,
fuel therefor, and all manuals, drawings, instructions, warranties and
rights with respect thereto, and all products and proceeds thereof and
condemnation awards and insurance proceeds with respect thereto.
"Goods" means all "goods" as defined in the
Code, now owned or hereafter acquired by any Person, wherever located,
including embedded Software to the extent included in "goods" as defined
in the Code.
"Letter-of-Credit-Rights" means all
"letter-of-credit rights," as such term is defined in the Code, now
owned or hereafter acquired by any Person, including rights to payment
or performance under a letter-of-credit, whether or not such Person, as
beneficiary, has demanded or is entitled to demand payment or
performance.
(b) The following new definitions are hereby added to
Annex A to the Credit Agreement in appropriate alphabetical order:
"Software" means all "software," as such term is
defined in the Code, now owned or hereafter acquired by any Person,
other than software embedded in any category of goods, including all
computer programs and all supporting information provided in connection
with a transaction related to any program.
"Supporting Obligations" means all "supporting
obligations" as such term is defined in the Code, now owned or hereafter
acquired by any Person, including letters of credit and guaranties
issued in support of Accounts, Chattel Paper, Documents, General
Intangibles, Instruments or Investment Property.
"Uniform Commercial Code jurisdiction" means any
jurisdiction that had adopted all or substantially all of Article 9 as
contained in the 2000 Official Text of the Uniform Commercial Code, as
recommended by the National Conference of Commissioners on Uniform
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State Laws and the American Law Institute, together with any subsequent
amendments or modifications to the Official Text.
(c) The definition of each of the following terms in
Annex A to the Credit Agreement is hereby amended as follows:
(i) The definition of "Chattel Paper" is hereby
amended by adding the words "including electronic chattel paper,"
immediately following the reference to "Code,".
(ii) The definition of "Code" is hereby amended
by adding the following immediately after the reference therein to
"provided,":
that to the extent that the Uniform Commercial
Code is used to define any term in the Agreement
or in any other Loan Document and such term is
defined differently in different Articles or
Divisions of the Uniform Commercial Code, the
definition of such term contained in Article or
Division 9 shall govern; provided further,
(iii) The definition of "Inventory" is hereby
amended by adding the words "and embedded software" immediately
following the reference thereto to "other supplies".
(iv) The definition of "Proceeds" is hereby
amended by deleting clauses (d) and (e) of such definition and replacing
it with the following:
(d) any recoveries by any Person against third
parties with respect to any litigation or
dispute concerning any of the Collateral
including claims arising out of the loss or
nonconformity of, interference with the use of,
defects in, or infringement of rights in, or
damage to, Collateral, (e) all amounts collected
on, or distributed on account of, other
Collateral, including dividends, interest,
distributions and Instruments with respect to
Investment Property and pledged Stock, and (f)
any and all other amounts, rights to payment or
other property acquired upon the sale, lease,
license, exchange or other disposition of
Collateral and all rights arising out of
Collateral.
(d) The second sentence of the third to the last
paragraph of Annex A to the Credit Agreement is hereby amended by (i) deleting
the reference therein to "as in effect in the State of California" and (ii)
adding the following proviso immediately preceding the period at the end
thereof: "provided, that in the event that any term is defined differently in
different Articles or Divisions of the Code, the definition thereof contained in
Article or Division 9 shall control".
(e) The chart in Paragraph (a) of Annex G to the Credit
Agreement is hereby deleted in its entirety and the following is substituted
therefor:
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(C) (D)
(A) (B) Capital Expenditure Maximum Combined
No. Period Allocation Expenditures
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1 7/1/00 through 9/29/00 $10,000,000 $25,000,000
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2 7/1/00 through 12/29/00 $26,000,000 $56,000,000
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3 7/1/00 through 3/30/01 $41,000,000 $86,000,000
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4 7/1/00 through 6/29/01 $55,000,000 $115,000,000
---------------------------------------------------------------------------------------
5 9/30/00 through 9/28/01 $66,000,000 $117,000,000
---------------------------------------------------------------------------------------
6 12/30/00 through 12/28/01 $65,000,000 $107,900,000
---------------------------------------------------------------------------------------
7 3/31/01 through 3/29/02 $63,000,000 $98,500,000
---------------------------------------------------------------------------------------
8 6/30/01 through 6/28/02 $60,000,000 $89,700,000
---------------------------------------------------------------------------------------
9 9/29/01 through 9/27/02 $57,000,000 $74,600,000
---------------------------------------------------------------------------------------
10 12/29/01 through 12/27/02 $58,000,000 $70,800,000
---------------------------------------------------------------------------------------
11 3/30/02 through 3/28/03 $61,000,000 $71,600,000
---------------------------------------------------------------------------------------
12 6/29/02 through 6/27/03 $65,000,000 $75,600,000
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(f) Paragraph (b) of Annex G to the Credit Agreement is
hereby amended by (i) deleting the reference to "$58,000,000" and replacing it
with "$51,500,000", (ii) deleting the reference to "$69,000,000" and replacing
it with "$45,200,000", (iii) deleting the reference to "$71,000,000" and
replacing it with "$43,800,000", and (iv) deleting the reference to $73,000,000"
and replacing it with "$63,200,000".
(g) Paragraph (d) of Annex G to the Credit Agreement is
hereby deleted in its entirety and the following is substituted therefor:
(d) Borrower and its Subsidiaries (other than
the Excluded Subsidiaries) on a consolidated basis shall
not make New Venture Investments in an aggregate amount,
at any time for the 12-month period then ended, that
exceeds the following:
----------------------------------------------
(A) (B)
Maximum New Venture
Period Ending On Investments
----------------------------------------------
September 28, 2001 $51,000,000
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December 28, 2001 $42,900,000
----------------------------------------------
March 29, 2002 $35,500,000
----------------------------------------------
June 28, 2002 $29,700,000
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September 27, 2002 $17,600,000
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December 27, 2002 $12,800,000
----------------------------------------------
March 28, 2003 $10,600,000
----------------------------------------------
June 27, 2003 $10,600,000
----------------------------------------------
(h) Paragraph (e) of Annex G to the Credit Agreement is
hereby deleted in its entirety and the following is substituted therefor:
(e) Borrower and it Subsidiaries (other than the
Excluded Subsidiaries) on a consolidated basis shall not
make aggregate Capital Expenditures that exceed the
total EBITDA for Borrower and its Subsidiaries on
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a consolidated basis, in each case for the 12-month
period then ended (or with respect to each of the Fiscal
Quarters ending on or prior to March 30, 2001, the
period commencing on July 1, 2000, and ending on the
last day of such Fiscal Quarter); provided, that with
respect to (i) the nine-month period from July 1, 2000,
through Xxxxx 00, 0000, (xx) the 12-month period from
September 30, 2000, through September 28, 2001, (iii)
the 12-month period from December 30, 2000, through
December 28, 2001, and (iv) the 12-month period from
March 31, 2001, through March 29, 2002, the aggregate
Capital Expenditures of Borrower and its Subsidiaries
(other than the Excluded Subsidiaries) for each such
period provided for in clauses (i) through (v) above,
shall not exceed the sum of (A) EBITDA for Borrower and
its Subsidiaries (other than the Excluded Subsidiaries)
for such period on a consolidated basis plus (B)
$5,000,000.
(i) Each reference in the Credit Agreement or the other
Loan Documents to "General Electric Capital Corporation, a New York
corporation," is hereby deleted and "General Electric Capital Corporation, a
Delaware corporation," is substituted in lieu thereof.
(j) Each reference in the Credit Agreement or the other
Loan Documents to "Letter of Credit Rights" is hereby deleted and
"Letter-of-Credit-Rights" is substituted in lieu thereof.
3. Conditions to Effectiveness. The effectiveness of this
Amendment is subject to satisfaction of each of the following conditions:
(a) receipt by Co-Agents of this Amendment duly executed
by Borrower, each of the other Credit Parties, Co-Agents and Requisite Lenders;
(b) receipt by Co-Agents of the First Amendment to
Security Agreement (other than Schedules II and III to the Security Agreement)
duly executed by Borrower and Agent;
(c) receipt by Co-Agents of the Power of Attorney duly
executed by Borrower in favor of Agent and acknowledged by a notary public;
(d) payment of $50,000 by Borrower to Agent, for the
ratable benefit of Lenders, as an amendment fee in connection with this Fourth
Amendment; and
(e) the absence of any Defaults or Events of Default as
of the date hereof.
4. Additional Covenant. On or before October 15, 2001, Borrower
shall deliver to Co-Agents completed Schedules II and III to the Security
Agreement, in form and substance satisfactory to Co-Agents, in furtherance of
Borrower's duties to give further assurances to Co-Agents and Lenders pursuant
to the terms of the Credit Agreement, Security Agreement and the other Loan
Documents. Borrower's failure to comply with the foregoing covenant by October
15, 2001, shall constitute an immediate Event of Default.
5. Entire Agreement. This Amendment, together with the Credit
Agreement and the other Loan Documents, is the entire agreement between the
parties hereto with respect to the subject matter hereof. This Amendment
supersedes all prior and contemporaneous oral and written agreements and
discussions with respect to the subject matter hereof.
6. Representations and Warranties. Borrower and each other
Credit Party hereby represents and warrants that the representations and
warranties contained in the Credit Agreement were true and correct in all
material respects when made and, except to the extent that (a) a particular
representation or warranty by its terms expressly applies only to an earlier
date or (b) Borrower or any
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other Credit Party, as applicable, has previously advised Co-Agents in writing
as contemplated under the Credit Agreement, are true and correct in all material
respects as of the date hereof.
7. Reaffirmation by Guarantors. Each Credit Party that is also a
Guarantor, by its execution of this Amendment, consents to the terms hereof and
ratifies and reaffirms all of the provisions of the Guaranties.
8. Miscellaneous.
(a) Counterparts. This Amendment may be executed in
identical counterpart copies, each of which shall be an original, but all of
which shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Amendment by facsimile transmission
shall be effective as delivery of a manually executed counterpart thereof.
(b) Headings. Section headings used herein are for
convenience of reference only, are not part of this Amendment, and are not to be
taken into consideration in interpreting this Amendment.
(c) Recitals. The recitals set forth at the beginning of
this Amendment are true and correct, and such recitals are incorporated into and
are a part of this Amendment.
(d) Effect. Upon the effectiveness of this Amendment,
from and after the date hereof, each reference in the Credit Agreement to "this
Agreement," "hereunder," "hereof," or words of like import shall mean and be a
reference to the Credit Agreement as amended hereby and each reference in the
other Loan Documents to the Credit Agreement, "thereunder," "thereof," or words
of like import shall mean and be a reference to the Credit Agreement as amended
hereby.
(e) No Novation. Except as expressly provided in Section
2 of this Amendment, the execution, delivery, and effectiveness of this
Amendment shall not (i) limit, impair, constitute a waiver of, or otherwise
affect any right, power, or remedy of any Co-Agent or any Lender under the
Credit Agreement or any other Loan Document, (ii) constitute a waiver of any
provision in the Credit Agreement or in any of the other Loan Documents, or
(iii) alter, modify, amend, or in any way affect any of the terms, conditions,
obligations, covenants, or agreements contained in the Credit Agreement or any
other Loan Document, all of which are ratified and affirmed in all respects and
shall continue in full force and effect.
(f) Conflict of Terms. In the event of any inconsistency
between the provisions of this Amendment and any provision of the Credit
Agreement, the terms and provisions of this Amendment shall govern and control.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, this Fourth Amendment to Credit Agreement
has been duly executed as of the date first written above.
GENERAL ELECTRIC CAPITAL CORPORATION,
as Administrative Agent and a Lender
By:
-------------------------------------
Xxxxxx X. Xxxxxx
Duly Authorized Signatory
BANK OF AMERICA, N.A.,
as Documentation Agent and a Lender
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
THE CIT GROUP/BUSINESS CREDIT, INC.,
as a Lender
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
WESTERN DIGITAL TECHNOLOGIES, INC.,
a Delaware corporation formerly known as
Western Digital Corporation
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
WESTERN DIGITAL (U.K.), LTD.,
a corporation organized under the laws
of the United Kingdom
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
WESTERN DIGITAL (I.S.) LIMITED,
a corporation organized under the laws
of Ireland
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
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APPENDIX A
(REQUEST LETTER FROM BORROWER)
SEE ATTACHED.
8
POWER OF ATTORNEY
This Power of Attorney is executed and delivered by Western
Digital Technologies, Inc., a Delaware corporation formerly known as Western
Digital Corporation ("Grantor") to General Electric Capital Corporation, a
Delaware corporation (hereinafter referred to as "Attorney"), as Agent, for the
benefit of Co-Agents and Lenders, under a Credit Agreement dated as of September
20, 2000, as amended, a Security Agreement dated as of September 20, 2000, as
amended, and the other related documents (collectively, the "Loan Documents").
No person to whom this Power of Attorney is presented, as authority for Attorney
to take any action or actions contemplated hereby, shall be required to inquire
into or seek confirmation from Grantor as to the authority of Attorney to take
any action described below, or as to the existence of or fulfillment of any
condition to this Power of Attorney, which is intended to grant to Attorney
unconditionally the authority to take and perform the actions contemplated
herein, and Grantor irrevocably waives any right to commence any suit or action,
in law or equity, against any person or entity which acts in reliance upon or
acknowledges the authority granted under this Power of Attorney. The power of
attorney granted hereby is coupled with an interest, and may not be revoked or
canceled by Grantor without Attorney' s written consent.
Subject to the limitations set forth in Section 6 of the
Security Agreement, the terms of which are incorporated herein by this
reference, Grantor hereby irrevocably constitutes and appoints Attorney (and all
officers, employees or agents designated by Attorney), with full power of
substitution, as Grantor's true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of Grantor and in the
name of Grantor or in its own name, from time to time in Attorney's discretion,
to take any and all appropriate action and to execute and deliver any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of the Loan Documents and, without limiting the generality of the
foregoing, Grantor hereby grants to Attorney the power and right, on behalf of
Grantor, without notice to or assent by Grantor, and at any time, to do the
following: (a) change the mailing address of Grantor, open a post office box on
behalf of Grantor, open mail for Grantor, and ask, demand, collect, give
acquittances and receipts for, take possession of, endorse any invoices, freight
or express bills, bills of lading, storage or warehouse receipts, drafts against
debtors, assignments, verifications, and notices in connection with any property
of Grantor; (b) effect any repairs to any asset of Grantor, or continue or
obtain any insurance and pay all or any part of the premiums therefor and costs
thereof, and make, settle and adjust all claims under such policies of
insurance, and make all determinations and decisions with respect to such
policies; (c) pay or discharge any taxes, liens, security interests, or other
encumbrances levied or placed on or threatened against Grantor or its property;
(d) defend any suit, action or proceeding brought against Grantor if Grantor
does not defend such suit, action or proceeding or if Attorney believes that
Grantor is not pursuing such defense in a manner that will maximize the recovery
to Attorney, and settle, compromise or adjust any suit, action, or proceeding
described above and, in connection therewith, give such discharges or releases
as Attorney may deem appropriate; (e) file or prosecute any claim, litigation,
suit or proceeding in any court of competent jurisdiction or before any
arbitrator, or take any other action otherwise deemed appropriate by Attorney
for the purpose of collecting any and all such moneys due to Grantor whenever
payable and to enforce any other right in respect of Grantor's property; (f)
cause the certified public accountants then engaged by Grantor to prepare and
deliver to Attorney at any time and from time to time, promptly upon Attorney's
request, the following reports: (1) a reconciliation of all accounts, (2) an
aging of all accounts, (3) trial balances, (4) test verifications of such
accounts as Attorney may request, and (5) the results of each physical
verification of inventory; (g) communicate in its own name with any party to any
Contract with regard to the assignment of the right, title and interest of such
Grantor in and under the Contracts and other matters relating thereto; (h) to
file such financing statements with respect to the Security Agreement, with or
without Grantor's signature, or to file a photocopy of the Security Agreement in
substitution for a financing statement, as Agent may deem appropriate and to
execute in Grantor's name such financing statements and amendments thereto and
continuation statements which may require Grantor's signature; and (i) execute,
in connection with any sale provided for in any Loan Document, any
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endorsements, assignments or other instruments of conveyance or transfer with
respect to the Collateral and to otherwise direct such sale or resale, all as
though Attorney were the absolute owner of the property of Grantor for all
purposes, and to do, at Attorney's option and Grantor's expense, at any time or
from time to time, all acts and other things that Attorney reasonably deems
necessary to perfect, preserve, or realize upon Grantor's property or assets and
Attorney's Liens thereon, all as fully and effectively as Grantor might do.
Grantor hereby ratifies, to the extent permitted by law, all that said Attorney
shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, this Power of Attorney is executed by
Grantor, and Grantor has caused its seal to be affixed pursuant to the authority
of its board of directors this 26th day of September, 2001.
"GRANTOR"
WESTERN DIGITAL TECHNOLOGIES, INC.,
a Delaware corporation formerly known as
Western Digital Corporation
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
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ACKNOWLEDGMENT OF INSTRUMENTS
STATE OF ________________ SS.
COUNTY OF________________
On ___________________ , before me, the undersigned notary
public in and for said state, personally appeared ___________________________ ,
personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument, the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
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