EXHIBIT 10.3
SECOND AMENDMENT TO THIRD AMENDED
AND RESTATED CREDIT AGREEMENT
THIS SECOND AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT
dated as of June 27, 2003 (this "Amendment") amends the Third Amended and
Restated Credit Agreement dated as of October 1, 2002 (as previously amended,
the "Credit Agreement") among RAYOVAC CORPORATION (the "Company"), VARTA
GERATEBATTERIE GmbH (the "Subsidiary Borrower"), various financial institutions
(the "Lenders") and BANK OF AMERICA, N.A., as administrative agent (in such
capacity, the "Administrative Agent"). Capitalized terms used but not defined
herein have the respective meanings given thereto in the Credit Agreement.
WHEREAS, the parties hereto desire to amend the Credit Agreement in
certain respects as set forth below; and
WHEREAS, the Company has requested that the Lenders consent to certain
organizational restructurings as described in the Company's Lender's
Presentation dated June 6, 2003 (the "Restructurings"), a copy of which has been
made available to each Lender;
NOW, THEREFORE, for good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the parties hereto agree as
follows:
SECTION 1. AMENDMENTS.
1.1 Amendments to Definitions. Section 1.1 of the Agreement is
amended as set forth below:
(a) The definitions of "Acquisition Restructuring Charges" and
"Other Restructuring Charges" are deleted and the following new definition of
"Restructuring Charges" is inserted in appropriate alphabetical sequence:
"Restructuring Charges means restructuring charges of not more
than $42,500,000 identified to the Administrative Agent in writing
prior to November 15, 2003 and taken by the Company prior to September
30, 2003, of which not more than $24,000,000 shall be cash
restructuring charges and not more than $21,000,000 shall be non-cash
restructuring charges."
(b) The definition of "Adjusted EBITDA" is amended in its entirety
to read as follows:
"Adjusted EBITDA means, for any Computation Period, the total
of (i) EBITDA for such Computation Period plus (ii) any Restructuring
Charges taken during such Computation Period. In addition, if the
Company or any Subsidiary makes an Acquisition or a material
divestiture during any Computation Period, then the historical
financial results for such period of the Person or assets acquired
shall be added to Adjusted EBITDA (without taking account of cost
savings or other synergies unless
approved by the Required Lenders) and/or the portion of the financial
results of the Company and its Subsidiaries for such period
attributable to the Person or assets divested shall be subtracted in
calculating Adjusted EBITDA, all as reasonably determined by the
Company and certified to the Administrative Agent and the Lenders."
(c) Clause (a) of the definition of "Excess Cash Flow" is amended
to read as follows:
"(a) EBITDA for such period plus any non-cash
Restructuring Charges,"
1.2 Extension of Date for Completion of Transformation. Section
9.1(k) of the Credit Agreement is amended by replacing the date "June 30, 2003"
therein with the date "March 31, 2004".
1.3 Tax Shelter Regulations.
(a) Article VI of the Credit Agreement is amended by adding
thereto the following new Section 6.24:
"6.24 Tax Shelter Regulations. The Borrowers do not intend to
treat the Loans or the Letters of Credit as being a "reportable
transaction" (within the meaning of Treasury Regulation Section
1.6014-4). In the event a Borrower determines to take any action
inconsistent with such intention, it will promptly notify the
Administrative Agent thereof. If a Borrower so notifies the
Administrative Agent, the Borrowers acknowledge that one or more of the
Lenders may treat its Loans and/or its interest in Swing Line Loans
and/or Letters of Credit as a part of a transaction that is subject to
Treasury Regulation Section 301.6112-1, and such Lender or Lenders, as
applicable, will maintain the lists and other records required by such
Treasury Regulation."
(b) Section 7.2 of the Credit Agreement is amended by deleting the
word "and" at the end of clause (e), adding the following new clause (f) after
clause (e) and re-lettering existing clause (f) as clause (g):
"(f) promptly after a Borrower has notified the
Administrative Agent of any intention by such Borrower to treat the
Loans and/or Letters of Credit as being a "reportable transaction"
(within the meaning of Treasury Regulation Section 1.6011-4), a duly
completed copy of IRS Form 8886 or any successor form; and"
(c) Section 11.9 of the Credit Agreement is amended by adding at
the end thereof the following language:
"Notwithstanding anything herein to the contrary, information subject
to the foregoing confidentiality restrictions shall not include, and
the Administrative Agent and each Lender may disclose without
limitation of any kind, any information with respect to the "tax
treatment" and "tax structure" (in each case, within the meaning of
Treasury Regulation Section 1.6011-4) of the transactions contemplated
hereby and all materials of any kind (including opinions or other tax
analyses) that are provided to the Administrative Agent or such Lender
relating to such tax treatment and tax structure; provided that with
respect to any document or similar item that in either case contains
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information concerning the tax treatment or tax structure of the
transaction as well as other information, this sentence shall only
apply to such portions of such document or item that relate to the tax
treatment or tax structure of the Loans, Letters of Credit and
transactions contemplated hereby."
SECTION 2. CONSENT. The Administrative Agent and the Required Lenders
consent to the Restructurings and the related releases and substitutions of
collateral and agree with the Company and the Subsidiary Borrower that the
transfers and investments effected as part of the Restructurings shall be
disregarded in determining usage of the basket amounts for permitted exceptions
under Sections 8.2 and 8.4 of the Credit Agreement.
SECTION 3. CONDITIONS PRECEDENT. This Amendment shall become effective
when the Administrative Agent has received counterpart signature pages (by
facsimile or otherwise) of this Amendment signed by the Company, the Subsidiary
Borrower, the Administrative Agent and the Required Lenders.
SECTION 4. MISCELLANEOUS.
4.1 Continuing Effectiveness, etc. The Credit Agreement, as
amended hereby, shall remain in full force and effect and is hereby ratified,
approved and confirmed in all respects.
4.2 Headings. The headings in this Amendment are inserted for
convenience only and shall not affect the meaning or interpretation of this
Amendment.
4.3 Execution in Counterparts. This Amendment may be executed by
the parties hereto in several counterparts, each of which shall be deemed to be
an original and all of which shall constitute together but one and the same
agreement. A counterpart signature page delivered by facsimile shall be
effective as an original.
4.4 Governing Law. THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT
MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.
[Signatures to Follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
RAYOVAC CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title:President and COO
VARTA GERATEBATTERIE GmbH
By: /s/Andreas Rouve
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Name: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title:CFO
VARTA GERATEBATTERIE GmbH
By: /s/▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇ ▇▇▇▇▇
Title:CEO
S-1
BANK OF AMERICA, N.A., as
Administrative Agent and as a Lender
By:__________________________________________
Name:
Title:
S-2
_____________________________________________
[PRINT OR TYPE NAME OF LENDER]
By:__________________________________________
Name:________________________________________
Title:_______________________________________