EXHIBIT 10.2
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EXECUTION COPY
CREDIT AGREEMENT
Dated as of April 16, 2007
among
HARSCO CORPORATION,
as Borrower
and
THE ROYAL BANK OF SCOTLAND PLC,
as Lender
CREDIT AGREEMENT
DATED AS OF APRIL 16, 2007
CREDIT AGREEMENT dated as of April 16, 2007 between HARSCO CORPORATION, a
Delaware corporation (the "BORROWER"), and THE ROYAL BANK OF SCOTLAND PLC
("RBS"). Capitalized terms not otherwise defined in this Agreement shall have
the same meanings as specified therefor in the Five-Year Credit Agreement dated
as of November 23, 2005 (as in effect on the date hereof, the "EXISTING CREDIT
AGREEMENT") among the Borrower, the lenders party thereto and JPMorgan Chase
Bank, N.A., as administrative agent for such lenders.
SECTION 1. The Advances. (a) RBS hereby agrees, on the terms and conditions
hereinafter set forth, to make advances in U.S. dollars (each, an "ADVANCE") to
the Borrower from time to time on any Business Day during the period from the
date of this Agreement to but not including the Termination Date (as herein
defined) in an aggregate principal amount at any time outstanding not to exceed
$75,000,000 (the "FACILITY"). Within the limits of the unused portion of the
Facility in effect from time to time, the Borrower may borrow under this Section
1(a), prepay pursuant to Section 1(e) and reborrow under this Section 1(a).
(b) The Borrower may request Advances hereunder by giving a written notice
of borrowing (a "NOTICE OF BORROWING") to RBS (A) not later than 10:00 A.M. (New
York City time) on the Business Day of such Advances for Advances bearing
interest at a rate determined by reference to the Base Rate (as defined below)
("BASE RATE ADVANCES") or (B) not later than 11:00 A.M. (New York City time) on
the third Business Day prior to such Advances for Advances bearing interest at a
rate determined by reference to the LIBO Rate ("EURODOLLAR RATE ADVANCES"),
which Notice of Borrowing shall be irrevocable and shall in each case specify
(i) whether the Advances then being requested are to be a Eurodollar Rate
Advances or Base Rate Advances, (ii) the date of such Advances (which shall be a
Business Day), (iii) the aggregate principal amount of the Advances, such amount
being at least $5,000,000 and multiples of $1,000,000 thereof and (iv) if such
Advances are to be Eurodollar Rate Advances, the Interest Period with respect
thereto. If no election as to the Type of Advances is specified, then the
requested Advances shall be Base Rate Advances. If no Interest Period with
respect to any Eurodollar Rate Advance is specified, then the Borrower shall be
deemed to have selected an Interest Period of one month's duration. Upon
fulfillment of the applicable conditions set forth in Sections 2, if applicable,
and 3, RBS will make the proceeds of such Advance available to the Borrower on
the proposed date thereof by wire transfer to the account specified by the
Borrower in the related Notice of Borrowing in immediately available funds by
12:00 noon (New York City time). All Notices of Borrowing may be delivered by
telephone if promptly confirmed in writing. For purposes of this Agreement,
"BASE RATE" means, for any day, a fluctuating rate per annum in effect from time
to time, which rate per annum shall be equal to the greater of (a) the rate of
interest announced by RBS as its base rate in effect on such day and (b) the sum
of (i) 1/2 of 1% per annum and (ii) the Federal Funds Effective Rate in effect
on such day.
(c) The Facility shall be automatically terminated and the Borrower shall
repay to RBS the aggregate principal amount of all outstanding Advances made,
together with accrued and unpaid interest thereon, on the earliest of (i)
December 31, 2007, (ii) the date of the termination of the Facility in full
pursuant to Section 1(d) hereof, (iii) the date on which RBS shall have
terminated its commitment hereunder and declared the Advances forthwith due and
payable during the continuance of an Event of Default pursuant to Article VII of
the Existing Credit Agreement as incorporated by reference (and with respect to
an Event of Default under paragraph (g) or (h) of Article VII of the Existing
Credit Agreement, the Facility shall automatically terminate and the Advances
shall automatically become due and payable without notice) and (iv) the date on
which RBS shall have terminated its commitment hereunder and
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declared the Advances forthwith due and payable upon the termination of the
Existing Credit Agreement (the "TERMINATION DATE"). Upon the issuance by the
Borrower or any of its Subsidiaries of (A) any equity security in the capital
markets or (B) any debt security in the capital markets with a maturity in
excess of one year, the Facility shall automatically permanently reduce by an
amount equal to the cash proceeds (net of the out-of-pocket fees, costs and
other expenses incurred by the Borrower or such subsidiary in connection with
such issuance, including, without limitation, all legal fees, brokerage fees,
consulting fees, accounting fees, underwriting discounts and commissions and
other customary fees, costs and expenses) actually received by the Borrower or
Subsidiary from any such issuance on the tenth Business Day after the date of
such receipt. Notwithstanding the foregoing, any proceeds received from clauses
(A) or (B )in the immediately preceding sentence will be applied in the
following order :
First, to reduce the facility under the 364-Day Credit Agreement dated
December 23, 2005, as amended among the Borrower, The Royal Bank of Scotland
plc, and Citicorp North America, Inc.,
Second , to reduce the Facility hereunder, and
Third, to reduce the facility under the Credit Agreement dated the date
hereof between the Borrower and The Royal Bank of Scotland Finance(Ireland).
(d) The Borrower may, upon at least three Business Days' notice to RBS,
terminate in whole or reduce in part the Facility.
(e) The Borrower may, upon irrevocable notice given to RBS not later than
11:00 A.M. (New York City time) (i) on the date of the proposed prepayment, in
the case of a prepayment of Base Rate Advances or (ii) on the third Business Day
prior to the date of prepayment, in the case of a prepayment of Eurodollar Rate
Advances, in each case stating the proposed date and aggregate principal amount
of the prepayment and if such notice is given the Borrower, shall prepay the
aggregate principal amount of the Advances specified in such notice . All
notices of prepayment may be given by telephone if promptly confirmed in
writing. All prepayments under this Section 1(e) shall be made together with (i)
accrued and unpaid interest to the date of such prepayment on the principal
amount so prepaid and (ii) in the case of any such prepayment of a Eurodollar
Rate Advance on a date other than the last day of an Interest Period therefor,
any amounts owing in respect of Eurodollar Rate Advances pursuant to Section
2.15 of the Existing Credit Agreement as incorporated herein by reference.
(f) The Borrower shall pay interest on the unpaid principal amount of each
Advance from the date of such Advance until the principal amount thereof is paid
in full on the dates for payment specified for Borrowings of the same Type under
the Existing Credit Agreement at a rate per annum equal, (i) in the case of Base
Rate Advances, at the Base Rate in effect from time to time and (ii) in the case
of Eurodollar Rate Advances, at the sum of the LIBO Rate in effect for the
applicable Interest Period plus the Applicable Margin (as defined below) from
time to time in effect. Similarly, the Borrower shall pay RBS a commitment fee
("Commitment Fee") equal to the Applicable Percentage (as hereinafter defined)
times the actual daily amount of the unused portion of the Facility. The
Commitment Fee shall accrue at all times from the date of this Agreement to the
Termination Date, and shall be due and payable quarterly in arrears on the last
Business day of each of March, June, September, and December, commencing on
June, 2007, and on the Termination Date. The Commitment Fee shall be paid in
immediately available funds and shall be non-refundable. For purposes of this
Section 2(f), the term "APPLICABLE MARGIN" shall mean 0.370% and the term
"APPLICABLE PERCENTAGE" shall mean 0.15%.
On the Effective Date, the Borrower shall pay RBS a non-refundable upfront
fee of 0.05% of the Facility in immediately available funds ("Upfront Fee").
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(g) The Borrower shall make each payment hereunder, irrespective of any
right of counterclaim or setoff, not later than 12:00 Noon (New York City time)
on the day when due in Dollars and in same day funds to RBS at the account of
RBS most recently specified in writing to the Borrower by RBS, with payments
received by RBS after 12:00 Noon (New York City time) on any such day being
deemed to have been received on the next succeeding Business Day. All
computations of interest determined by reference to the Base Rate and of
facility fees payable hereunder shall be made on the basis of a year of 365 or
366 days, as the case may be, and all other computations of interest, Commitment
Fees and fees payable hereunder shall be made on the basis of a year of 360
days, in each case for the actual number of days (including the first day but
excluding the last day) occurring in the period for which such interest or fees
are payable.
(h) Section 2.21 of the Existing Credit Agreement is expressly not
incorporated by reference into this Agreement and the parties hereto agree that
the Facility is available only to the Borrower.
(i) The proceeds of the Advances shall be available for general corporate
purposes of the Borrower and its Subsidiaries, including acquisition financing.
SECTION 2. Conditions Precedent to the Effectiveness of Section 1. This
Agreement shall become effective on the first date (the "EFFECTIVE DATE") which
shall be no later than April 16, 2007on which all of the conditions precedent to
the closing date under Section 4.01(a), (b)(i), (c) and (d) of the Existing
Credit Agreement shall have been satisfied with respect to this Agreement as if
such conditions precedent were set forth in full herein (with appropriate
modifications to refer to RBS, as the lender, the Facility and this Agreement)
and the Borrower shall have paid RBS the Upfront Fee. The parties hereby agree
that Section 4.01(b)(ii) of the Existing Credit Agreement shall not be
applicable to this Agreement.
SECTION 3. Conditions Precedent to Each Advance. The obligation of RBS to
make an Advance is subject to the satisfaction of the following conditions:
(a) RBS shall have received a Notice of Borrowing;
(b) The representations and warranties set forth in
Article III of the Existing Credit Agreement as incorporated herein
by reference shall be true and correct in all material respects on
and as of the date of such Advance with the same effect as though
made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date;
provided, however, that no representation as to either (i) the
absence of any Material Adverse Change in the financial condition of
the Borrower, as provided in the last sentence of Section 3.02 of
the Existing Credit Agreement as incorporated herein by reference,
or (ii) the absence of any pending or threatened legal or arbitral
proceedings, or any proceedings by or before any Governmental
Authority, that could have a Material Adverse Effect on the
Borrower, as provided in Section 3.03 of the Existing Credit
Agreement as incorporated herein by reference, shall be required as
a condition to any Advance following the Effective Date.
(c) The Borrower shall be in compliance with all the
terms and provisions set forth herein on its part to be observed or
performed, and at the time of and immediately after such Advance no
Event of Default or Default shall have occurred and be continuing.
Each Advance shall be deemed to constitute a representation and warranty by the
Borrower on the date of such Advance as to the matters specified in paragraphs
(b) and (c) of this Section 3.
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SECTION 4. Incorporation by Reference. (a) All of the terms and conditions
of the Existing Credit Agreement (including, without limitation, all conditions,
representations and warranties, covenants, events of default, increased costs,
taxes, capital adequacy and assignment provisions, and all defined terms used
therein and exhibits and schedules to the Existing Credit Agreement referred to
therein) that are not otherwise fully and expressly set forth in this Agreement
are specifically incorporated herein by reference with the same force and effect
as if the same were set out in this Agreement in full; provided, however, that
Sections 2.01 through 2.05, inclusive, Sections 2.06, 2.07(a), 2.08(c), 2.11,
2.12, 2.21, and 2.22 Articles VIII and IX, and Sections 10.01, 10.02, 10.03,
10.05, 10.07, 10.8 and 10.14 are expressly not incorporated by reference herein.
Except as otherwise provided herein, all references in such incorporated
provisions to the "Administrative Agent", " ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank, N.A.",a
"Lender", the "Lenders" or the "Required Lenders" or words of similar import or
to "this Agreement", "hereof", "hereto" or "hereunder" or words of similar
import or to any "Loan Document", "thereof", "thereto" or "thereunder" or words
of similar import shall, without further reference, mean and refer to RBS under
this Agreement and to this Agreement, respectively; all references in such
incorporated provisions to the "Company" or a "Borrower" shall, without further
reference, mean and refer to the Borrower hereunder; all references in such
incorporated provisions to a "Loan" or the "Loans" (or to a Type of "Loan" under
the Existing Credit Agreement) or a "Borrowing" or the "Borrowings" or words of
similar import shall, without further reference, mean and refer to an Advance or
the Advances, as appropriate, hereunder; all references in such incorporated
provisions to a "Commitment" or the "Total Commitments" shall, without further
reference, mean and refer to the Facility hereunder; and all references in such
incorporated provisions to the "Maturity Date" shall, without further reference,
mean and refer to the Termination Date hereunder. Similarly, to the extent any
word or phrase is defined in this Agreement, any such word or phrase appearing
in provisions so incorporated by reference from the Existing Credit Agreement
shall have the meaning given to it in this Agreement. The incorporation by
reference into this Agreement of the terms and conditions of the Existing Credit
Agreement is for convenience only, and this Agreement and the Existing Credit
Agreement shall at all times be, and be deemed to be and treated as, separate
and distinct loan obligations. The incorporation by reference into this
Agreement of the terms and conditions of the Existing Credit Agreement shall not
be affected or impaired by any subsequent expiration or termination of the
Existing Credit Agreement.
(b) The Borrower, by its execution of this Agreement,
hereby agrees to amend and restate this Agreement at the request of
RBS to set forth in full the provisions incorporated by reference
herein from the Existing Credit Agreement and to modify the terms
and provisions of this Agreement as appropriate to provide for the
inclusion of additional lenders upon any assignment or proposed
assignment by RBS of its rights and obligations hereunder effected
in accordance with Section 5(h). In addition, the Borrower hereby
agrees to notify RBS promptly and in any event within three Business
Days of any amendment, supplement or other modification to the
Existing Credit Agreement and, at the request of RBS, to enter into
any amendment or supplement to this Agreement proposed by RBS to
incorporate comparable amendments, supplements or other
modifications to this Agreement.
SECTION 5. Miscellaneous. (a) No amendment or waiver of any provision of
this Agreement, nor consent to any departure by the Borrower herefrom, shall in
any event be effective unless the same shall be in writing and signed by the
Borrower and RBS, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
(b) All notices and other communications provided for
hereunder (except as specified in Section 1(b)) shall be in writing
(including telecopier, telegraphic or telex) and mailed, telecopied,
telegraphed or delivered, if to the Borrower, at its address at ▇.▇.
▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention of ▇▇▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇ (Telecopy No. 717-763-6402) with a copy to ▇▇▇▇ ▇.
▇▇▇▇▇▇ (Telecopy No. 717-763-6402); and if to RBS, at its
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address at ▇▇▇ ▇▇▇▇ ▇▇▇., ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopier No. (212) 401- 3456; or, as to
each party, at such other address as shall be designated by such
party in a written notice to the other party. All such notices and
communications shall, when mailed, telecopied or telegraphed, be
effective when deposited in the mails, telecopied or delivered to
the telegraph company, respectively, except that notices to RBS
pursuant to the provisions of Section 1, 2 or 3 shall not be
effective until received by RBS.
(c) No failure on the part of RBS to exercise, and no
delay in exercising, any right hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right
hereunder preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
(d) The Borrower hereby agrees to pay on demand all
reasonable out-of-pocket costs and expenses of RBS in connection
with the preparation, execution, delivery, administration,
modification, amendment and enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement and
any other instruments or documents to be delivered in connection
herewith, including, without limitation, the reasonable fees and
disbursements of counsel for RBS with respect thereto and with
respect to advising RBS as to its rights and responsibilities under
this Agreement and such other agreements and documents.
(e) The Borrower agrees to indemnify and hold harmless
RBS and each of its respective affiliates and its officers,
directors, employees, agents and advisors (each, an "Indemnified
Party") from and against any and all claims, damages, losses,
liabilities and expenses (including, without limitation, reasonable
fees and expenses of counsel) incurred by or asserted or awarded
against any Indemnified Party, in each case arising out of or in
connection with or by reason of (including, without limitation, in
connection with any investigation, litigation or proceeding or
preparation of a defense in connection therewith) (i) this
Agreement, any of the transactions contemplated herein or the actual
or proposed use of the proceeds of the Advances or (ii) the actual
or alleged presence of Hazardous Materials on any property of the
Borrower or any of its Subsidiaries or any Environmental Liablility
relating in any way to the Borrower or any of its Subsidiaries,
except to the extent such claim, damage, loss, liability or expense
is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's gross
negligence or willful misconduct. In the case of an investigation,
litigation or other proceeding to which the indemnity in this
Section 5(e) applies, such indemnity shall be effective whether or
not such investigation, litigation or proceeding is brought by the
Borrower, its directors, shareholders or creditors or an Indemnified
Party or any other Person or any Indemnified Party is otherwise a
party thereto and whether or not the transactions contemplated
hereby are consummated. The Borrower also agrees not to assert any
claim for special, indirect, consequential or punitive damages
against any Indemnified Party on any theory of liability, arising
out of or otherwise relating to this Agreement, any of the
transactions contemplated herein or the use of the proceeds of the
Advances.
(f) Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and obligations
of the Borrower contained in Sections 5(d) and (e) shall survive the
payment in full of principal, interest and all other amounts payable
hereunder and the Termination Date.
(g) This Agreement shall be binding upon and inure to
the benefit of the Borrower, RBS and their respective successors and
assigns, except that the Borrower shall not have the right to assign
its rights hereunder or any interest herein without the prior
written consent of RBS.
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(h) RBS may assign to one or more Persons reasonably
satisfactory to the Borrower all or a portion of its rights and
obligations under this Agreement (including, without limitation, all
or a portion of the Facility and the Advances owing to it) on the
same terms and subject to the same conditions as are set forth for
assignments by lenders under the Existing Credit Agreement. In
connection with any such assignment, the Borrower agrees to execute
and deliver such documentation as RBS or any such permitted assignee
may reasonably request to evidence such assignment and the rights
and obligations of such assignee hereunder.
(i) This Agreement may be executed in separate
counterparts by the parties hereto, each of which when so executed
shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Agreement by telecopier
shall be effective as delivery of an originally executed counterpart
of this Agreement.
(j) This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
HARSCO CORPORATION
By /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President, Chief Financial
Officer and Treasurer
THE ROYAL BANK OF SCOTLAND PLC
By ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Managing Director