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AMENDED AND RESTATED
RESTRUCTURING AGREEMENT
dated as of August 28, 2003,
among
AMCAST INDUSTRIAL CORPORATION,
as Borrower,
THE LENDERS NAMED HEREIN,
as the Restructuring Lenders,
and
KEYBANK NATIONAL ASSOCIATION,
as the Collateral Agent
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SECTION 1. definitions..........................................2
1.1 Definitions..............................................2
1.2 Terms....................................................8
SECTION 2. CREDIT PARTY acknowledgments.........................8
2.1 Outstanding Indebtedness.................................8
2.2 Subject Noncompliance Events.............................8
2.3 Continuing Noncompliance Events..........................8
SECTION 3. RESTRUCTURING PERIOD and extensions of credit........9
3.1 Restructuring Period.....................................9
3.2 Loans and Letters of Credit..............................9
3.3 Interest Rates...........................................9
SECTION 4. restructuring covenants.............................10
4.1 Fees....................................................10
4.2 Mandatory Prepayments...................................10
4.3 Cash Availability; Special Reserve Funds................11
4.4 Strategic Plan..........................................12
4.5 Financial Reporting.....................................13
4.6 Financial Covenants.....................................13
4.7 Retention of Senior Management..........................15
4.8 Assignment of Commitments...............................15
SECTION 5. ACCESS AGREEMENT AND ACCOMMODATION AGREEMENT........15
5.1 Accommodation Agreement.................................15
5.2 Access Agreement........................................16
5.3 Authorization of Agent..................................16
5.4 Modification to Agreements..............................16
5.5 Further Assurances......................................16
SECTION 6. termination events..................................17
6.1 Termination of Restructuring Period.....................17
6.2 Effect at End of Restructuring Period...................17
6.3 ACKNOWLEDGMENT..........................................18
6.4 No Waiver...............................................18
6.5 No Contest..............................................18
SECTION 7. RESTRUCTURING LENDERS' ACKNOWLEDGMENTS..............18
SECTION 8. REPRESENTATIONS AND WARRANTIES......................18
8.1 Due Authorization; No Conflict; No Lien; Enforceable ...18
8.2 Representations and Warranties; Default.................19
SECTION 9. CONDITIONS PRECEDENT................................19
SECTION 10. MISCELLANEOUS.......................................20
10.1 Captions................................................20
10.2 Release.................................................20
10.3 Restructuring Lender Documents Unaffected...............20
10.4 Amendments or Modifications.............................20
10.5 No Other Promises or Inducements........................21
10.6 No Waiver of Rights.....................................21
10.7 Successors and Assigns..................................21
10.8 Continued Effectiveness.................................21
10.9 Tolling.................................................21
10.10 Revival of Obligations..................................22
10.11 Fees and Expenses.......................................22
10.12 Governing Law...........................................22
10.13 Entire Agreement........................................22
10.14 Counterparts............................................22
10.15 Notices.................................................22
10.16 Jurisdiction and Venue..................................23
10.17 Severability of Provisions; Attachments.................23
10.18 Legal Representation of Parties.........................23
10.19 JURY TRIAL WAIVER.......................................23
This AMENDED AND RESTATED RESTRUCTURING AGREEMENT, dated as of August
28, 2003 (this "Agreement"), is entered into by and among:
(i) AMCAST INDUSTRIAL CORPORATION, an Ohio corporation
("Borrower");
(ii) the Guarantors, as hereinafter defined, that are parties
hereto (together with Borrower, collectively, the "Credit
Parties" and, individually, each a Credit Party);
(iii) the Line of Credit Lenders, as hereinafter defined;
(iv) the Existing Credit Agreement Agent, as hereinafter defined,
and the Existing Credit Agreement Banks, as hereinafter
defined;
(v) the Noteholders, as hereinafter defined (the Line of Credit
Lenders, the Existing Credit Agreement Agent, the Existing
Credit Agreement Banks, and the Noteholders are collectively
referred to herein as the "Restructuring Lenders"); and
(vi) the Collateral Agent, as hereinafter defined.
PRELIMINARY STATEMENTS:
A. The Credit Parties and the Restructuring Lenders are parties to
certain Restructuring Lender Documents (as hereinafter defined) pursuant to
which the Restructuring Lenders have made certain loans and other extensions of
credit all on the terms and conditions set forth in the Restructuring Lender
Documents.
B. The Credit Parties, the Restructuring Lenders and the Collateral
Agent are parties to a Restructuring Agreement, dated as of July 15, 2002 (as
amended, the "Original Restructuring Agreement").
C. The Credit Parties have requested that the Restructuring Lenders and
the Collateral Agent amend and restate the Original Restructuring Agreement.
D. In connection with the foregoing, this Agreement is being entered
into by the Credit Parties, the Restructuring Lenders and the Collateral Agent
and, upon the occurrence of the Effective Date (as hereinafter defined), will
amend, restate and replace the Original Restructuring Agreement.
AGREEMENT:
In consideration of the premises and the mutual covenants contained in
this Agreement, and other good and valuable consideration the receipt and
sufficiency of which are acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions.
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1.1 Definitions. As used in this Agreement, the following terms have the
following meanings:
"Access and Security Agreement" means the Access and Security
Agreement, dated as of August 28, 2003, between GM and Borrower, as the same
may, in accordance with the terms of Section 5.4 hereof, from time to time be
amended, restated or otherwise modified.
"Accommodation Agreement" means the Accommodation Agreement, dated as
of August 28, 2003, among (i) GM, (ii) Borrower, (iii) KeyBank National
Association in its capacity as the Existing Credit Agreement Agent, on behalf of
and for the benefit of the Existing Credit Agreement Banks and the Line of
Credit Lenders, (iv) the Noteholders, and (v) KeyBank National Association in
its capacity as the LIFO Agent, on behalf of and for the benefit of the LIFO
Banks, as the same may, in accordance with the terms of Section 5.4 hereof, from
time to time be amended, restated or otherwise modified.
"Additional Prepayment" has the meaning set forth in Section 4.2(a)
hereof.
"Borrowing Base" means the Borrowing Base as defined in and determined
in accordance with the LIFO Credit Agreement as in effect on the date hereof;
provided, however, that, notwithstanding anything in the LIFO Credit Agreement
or any Restructuring Lender Document to the contrary, the Collateral Agent shall
at all times and from time to time, in its reasonable credit judgment, be
permitted to (a) establish such reserves as the Collateral Agent deems necessary
or appropriate, (b) modify the advance rates applicable to the Borrowing Base,
and/or (c) eliminate, modify or add eligibility criteria applicable to the
Borrowing Base.
"Borrowing Base Certificate" means a Borrowing Base Certificate, as
defined in, and in the form attached as an exhibit to, the LIFO Credit
Agreement.
"Budget" means, for any fiscal year of Borrower, a budget, including
monthly and quarterly balance sheets, income statements and cash flow statements
on a consolidated and by plant basis and otherwise in form and detail
satisfactory to the Required Lenders, that details Borrower's projected costs,
expenses, other expenditures, capital requirements and financial performance
forecast for such fiscal year.
"Cash Collateral Account" means a deposit account in the name of and
under the exclusive control of KeyBank National Association, as Collateral Agent
and LIFO Credit Agreement Agent, for the benefit of the Creditors, and
designated as the "Amcast Industrial Corporation Cash Collateral Account" or
other similar designation.
"Collateral Agent" means KeyBank National Association, in its capacity
as Collateral Agent under the Restructuring Lender Collateral Documents,
together with its successors and assigns in such capacity.
"Companies" means, collectively, Borrower and each Subsidiary.
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"Creditor Documents" means, collectively, the LIFO Lender Documents and
the Restructuring Lender Documents.
"Creditors" means, collectively, the LIFO Lenders and the Restructuring
Lenders.
"CTC Forbearance Agreement" means the Forbearance and Waiver Agreement
among Borrower, the LIFO Credit Agreement Agent, on behalf of and for the
benefit of the LIFO Credit Agreement Banks, and Bank One, Indiana, National
Association on behalf of itself and as CTC Agent (as defined therein) for the
benefit of and on behalf of the CTC Banks (as defined therein), dated as of June
5, 2001, as the same may from time to time be amended, restated or otherwise
modified.
"Domestic Adjusted EBITDA" means Domestic EBITDA other than Domestic
EBITDA attributable to CTC Company (as defined in the Existing Credit Agreement)
or Domestic EBITDA attributable to any discontinued operations.
"Domestic EBITDA" means Consolidated EBITDA (as defined in the Existing
Credit Agreement as in effect on the date hereof) less the amounts used in
calculating Consolidated EBITDA that are attributed to Foreign Subsidiaries.
"Domestic Fixed Charges" means, for any period, on a Consolidated basis
(but excluding Foreign Subsidiaries and CTC Company, as defined in the Existing
Credit Agreement) and in accordance with GAAP, the aggregate of (a) cash
interest expense (including, without limitation, the "imputed interest" portion
of capital leases, synthetics leases and asset securitizations, if any), (b)
principal payments on Funded Indebtedness (as defined in the Existing Credit
Agreement as in effect on the date hereof), and (c) Consolidated Capital
Expenditures (as defined in the Existing Credit Agreement as in effect on the
date hereof).
"Effective Date" has the meaning set forth in Section 9 hereof.
"Existing Bank Noncompliance Events" has the meaning set forth in
Section 2.2 hereof.
"Existing Credit Agreement" means the Credit Agreement, dated as of
August 14, 1997, among Borrower, the Existing Credit Agreement Banks and the
Existing Credit Agreement Agent, as amended and as the same may from time to
time be further amended, restated or otherwise modified.
"Existing Credit Agreement Agent" means KeyBank National Association,
as Agent for the Existing Credit Agreement Banks, together with its successors
and assigns in such capacity.
"Existing Credit Agreement Banks" means the lenders party to the
Existing Credit Agreement, together with their respective successors and assigns
in such capacity.
"Existing Credit Agreement Loan Documents" means the Loan Documents, as
defined in the Existing Credit Agreement.
"Existing Credit Agreement Obligations" means all indebtedness and
other obligations incurred by Borrower or any other Company to the Existing
Credit Agreement Agent or the Existing Credit Agreement Banks pursuant to the
Existing Credit Agreement, whether for principal, premium, interest, fees, costs
or indemnities, and whether now existing or hereafter arising.
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"Fixed Charge Coverage Ratio" means, for any time period, the ratio of
(a) Domestic Adjusted EBITDA for such period, to (b) Domestic Fixed Charges for
such period.
"Foreign Subsidiary" means a Subsidiary (other than Amcast
International Limited) that is organized outside of the United States.
"GM" means General Motors Corporation, together with its successors and
assigns.
"Guarantor" means any Person that pledges its credit or property in any
manner for the payment or other performance of any of the LIFO Lender
Obligations or Restructuring Lender Obligations.
"Incorporated Agreement" has the meaning given to such term in Section
1.2(b) hereof.
"Intercreditor Agreement" means the Collateral Agency and Intercreditor
Agreement, dated as of June 5, 2001, by and among the Existing Credit Agreement
Agent, the Existing Credit Agreement Banks, the Noteholders, the Line of Credit
Lenders and the Collateral Agent, as the same may from time to time be amended,
restated or otherwise modified.
"Investment Advisor" has the meaning given to such term in Section
4.4(c) hereof.
"Lien" means any mortgage, security interest, lien (statutory or
other), charge, encumbrance on, pledge or deposit of, or conditional sale,
leasing, sale with a right of redemption or other title retention agreement and
any capitalized lease with respect to any property (real or personal) or asset.
"LIFO Credit Agreement" means the Last-In-First-Out Credit Agreement,
dated as of June 5, 2001, among Borrower, the LIFO Credit Agreement Banks and
the LIFO Credit Agreement Agent, as amended and as the same may from time to
time be further amended, restated or otherwise modified.
"LIFO Credit Agreement Agent" means KeyBank National Association, as
Agent for the LIFO Credit Agreement Banks, together with its successors and
assigns.
"LIFO Credit Agreement Banks" means the lenders parties to the LIFO
Credit Agreement, together with their respective successors and assigns.
"LIFO Lender Collateral" means any property, whether tangible or
intangible, at any time securing the LIFO Lender Obligations, or any part
thereof.
"LIFO Lender Collateral Documents" means the Security Documents, as
defined in the LIFO Credit Agreement, together with all other documents,
instruments or agreements executed in connection with any security interest or
Lien granted, or otherwise obtained, on or in connection with the LIFO Lender
Collateral, or any part thereof.
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"LIFO Lender Documents" means, collectively, the LIFO Credit Agreement,
the LIFO Lender Collateral Documents, the other Loan Documents, as defined in
the LIFO Credit Agreement, the Access Agreement, the Accommodation Agreement and
the Subordination Agreement, together with all other documents, instruments or
agreements executed in connection with any of the foregoing, as the same may
from time to time be amended, restated or otherwise modified.
"LIFO Lender Obligations" means all indebtedness or other obligations
incurred by Borrower or any other Company to the LIFO Lenders pursuant to the
LIFO Credit Agreement, whether for principal, premium, interest, fees, costs or
indemnities, and whether now existing or hereafter arising.
"LIFO Lenders" means, collectively, the LIFO Credit Agreement Agent and
the LIFO Credit Agreement Banks.
"LIFO Restructuring Agreement" means the Amended and Restated LIFO
Restructuring Agreement, dated as of the date hereof, among Borrower and the
LIFO Lenders, as the same may from time to time be amended, restated or
otherwise modified.
"LIFO Repayment Date" means the date upon which the LIFO Credit
Agreement has been terminated and all obligations thereunder have been repaid in
full in cash.
"Line of Credit Documents" means the promissory notes and other
agreements evidencing the Line of Credit Obligations.
"Line of Credit Lenders" means the Line of Credit Lenders, as defined
in the Existing Credit Agreement.
"Line of Credit Obligations" means all indebtedness or other
obligations incurred by Borrower or any other Company to the Line of Credit
Lenders pursuant to the Line of Credit Documents, whether for principal,
interest, fees, costs or indemnities, and whether now existing or hereafter
arising.
"Missed Event" has the meaning given to such term in Section 4.4(b)
hereof.
"Northwestern" means The Northwestern Mutual Life Insurance Company,
together with its successors and assigns.
"Northwestern Note Agreement" means the Note Agreement, dated as of
November 1, 1995, pursuant to which Borrower has issued to Northwestern certain
$25,000,000 10.09% Senior Notes Due November 7, 2003, as amended and as the same
may from time to time be further amended, restated or otherwise modified.
"Note Agreements" means, collectively, the Principal Note Agreement and
the Northwestern Note Agreement.
"Noteholders" means, collectively, Principal and Northwestern.
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"Noteholder Obligations" means all indebtedness or other obligations
incurred by Borrower or any other Company to the Noteholders pursuant to the
Note Agreements and the notes issued thereunder, whether for principal, premium,
interest, fees, costs or indemnities, and whether now existing or hereafter
arising.
"Original Restructuring Agreement" has the meaning set forth in the
Preliminary Statements of this Agreement.
"Person" means any individual, sole proprietorship, partnership, joint
venture, unincorporated organization, corporation, limited liability company,
institution, trust, estate, government or other agency or political subdivision
thereof or any other entity.
"Principal" means Principal Life Insurance Company, together with its
successors and assigns.
"Principal Note Agreement" means the Note Agreement, dated as of
November 1, 1995, pursuant to which Borrower has issued to Principal certain
$25,000,000 10.09% Senior Notes Due November 7, 2003, as amended and as the same
may from time to time be further amended, restated or otherwise modified.
"Required Existing Banks" means the Majority Banks, as defined in the
Existing Credit Agreement.
"Required Lenders" means Required Lenders, as defined in the
Intercreditor Agreement.
"Requisite Restructuring Lenders" means (a) the Required Existing
Banks, (b) the Noteholders, and (c) the Line of Credit Lenders.
"Restructuring Fees" means the fees and expenses payable by Borrower on
the Effective Date to the Creditors and any of the fees payable by Borrower to
the Creditors after the Effective Date pursuant to Section 4.1 hereof.
"Restructuring Lender Collateral" means any property, whether tangible
or intangible, at any time securing the Restructuring Lender Obligations, or any
part thereof.
"Restructuring Lender Collateral Documents" means the Collateral
Documents, as defined in the Existing Credit Agreement, together with all other
documents, instruments or agreements executed in connection with any security
interest or Lien granted, or otherwise obtained, on or in connection with the
Restructuring Lender Collateral, or any part thereof.
"Restructuring Lender Documents" means, collectively, the Existing
Credit Agreement, the Existing Credit Agreement Loan Documents, the Note
Agreements, the Line of Credit Documents the Restructuring Lender Collateral
Documents, the Intercreditor Agreement, the Subordination Agreement, the Access
Agreement and the Accommodation Agreement, together with all other documents,
instruments or agreements executed in connection with any of the foregoing, as
the same may from time to time be amended, restated or otherwise modified.
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"Restructuring Lender Liens" means the Liens granted to the Collateral
Agent, for the benefit of the Restructuring Lenders, in the Restructuring Lender
Collateral pursuant to the Restructuring Lender Collateral Documents, or any
other Lien granted to or acquired by any Person that by its terms secures the
Restructuring Lender Obligations, or any part thereof.
"Restructuring Lender Obligations" means, collectively, (a) the
Existing Credit Agreement Obligations, (b) the Noteholder Obligations, (c) the
Line of Credit Obligations, and (d) all indebtedness or other obligations owing
by the Companies to the Collateral Agent or any Restructuring Lender pursuant to
the Restructuring Lender Collateral Documents.
"Restructuring Period" has the meaning set forth in Section 3.1 hereof.
"Retention Agreement" means the letter agreement dated as of August 28,
2003 among the Borrower, ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇.
"Special Reserve Funds" has the meaning specified in Section 4.3(c)
hereof.
"Subject Line of Credit Noncompliance Events" has the meaning set forth
in Section 2.2 hereof.
"Subject Noncompliance Events" means, collectively, the Existing Bank
Noncompliance Events, Subject Line of Credit Noncompliance Events and Subject
Noteholder Noncompliance Events.
"Subject Noteholder Noncompliance Events" has the meaning set forth in
Section 2.2 hereof.
"Subordination Agreement" means the Subordination, Waiver and Consent
Agreement, dated as of June 5, 2001, among Borrower, the LIFO Lenders, the
Restructuring Lenders, and the Collateral Agent, as the same may from time to
time be amended, restated or otherwise modified.
"Subsidiary" of Borrower or any of its Subsidiaries means (a) a
corporation more than 50% of the Voting Power of which is owned, directly or
indirectly, by Borrower or by one or more other subsidiaries of Borrower or by
Borrower and one or more subsidiaries of Borrower, (b) a partnership or limited
liability company of which Borrower, one or more other subsidiaries of Borrower
or Borrower and one or more subsidiaries of Borrower, directly or indirectly, is
a general partner or managing member, as the case may be, or otherwise has the
power to direct the policies, management and affairs thereof, or (c) any other
Person (other than a corporation) in which Borrower, one or more other
subsidiaries of Borrower or Borrower and one or more subsidiaries of Borrower,
directly or indirectly, has at least a majority interest in the Voting Power or
the power to direct the policies, management and affairs thereof.
"Termination Date" shall have the meaning set forth in Section 3.1
hereof.
"Termination Event" has the meaning set forth in Section 6.1 hereof.
"Voting Power" means, with respect to any Person, the exclusive ability
to control, through the ownership of shares of capital stock, partnership
interests, membership interests or otherwise, the election of members of the
board of directors or other similar governing body of such Person, and the
holding of a designated percentage of Voting Power of a Person means the
ownership of shares of capital stock, partnership interests, membership
interests or other interests of such Person sufficient to control exclusively
the election of that percentage of the members of the board of directors or
similar governing body of such Person.
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1.2 Terms.
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(a) The foregoing definitions shall be applicable to the singular and
plurals of the foregoing defined terms.
(b) The incorporation of any terms into this Agreement by reference to
another document (an "Incorporated Agreement") shall survive the expiration,
termination or failure of any such Incorporated Agreement to otherwise be in
full force and effect. In the event that any such Incorporated Agreement
expires, terminates or otherwise ceases to be in full force and effect, any
terms incorporated into this Agreement by reference to such Incorporated
Agreement shall continue to have the same meanings as if such Incorporated
Agreement had not expired, been terminated or otherwise failed to be in full
force and effect.
SECTION 2. CREDIT PARTY acknowledgments.
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2.1 Outstanding Indebtedness. Each Credit Party acknowledges and confirms that
(a) Exhibit A hereto sets forth, as of the Effective Date, (i) each Creditor,
and (ii) the aggregate principal amount of all outstanding indebtedness and the
aggregate face amount of all issued and outstanding letters of credit of the
Credit Parties (or any thereof) owing to each Creditor under the Creditor
Documents, (b) none of such amounts set forth on Exhibit A hereto, together with
all interest thereon and fees related thereto, are subject to any defense,
counterclaim, recoupment or offset of any kind, and (c) each Credit Party's
obligations in respect of such indebtedness and letter of credit obligations are
absolute and unconditional.
2.2 Subject Noncompliance Events. Each Credit Party acknowledges that Borrower
has failed to comply with, or will fail to comply with, (a) the provisions of
the Existing Credit Agreement as set forth on Exhibit B hereto (the "Existing
Bank Noncompliance Events"), (b) the provisions of the Note Agreements as set
forth on Exhibit C hereto (the "Subject Noteholder Noncompliance Events"), and
(c) the provisions of the Line of Credit Documents as set forth on Exhibit D
hereto (the "Subject Line of Credit Noncompliance Events").
2.3 Continuing Noncompliance Events. Each Credit Party acknowledges that (a) the
Subject Noncompliance Events are and will be continuing and have not been waived
by virtue of any previous actions (or failure to act) by the Existing Credit
Agreement Agent, the Existing Credit Agreement Banks, the Noteholders or the
Line of Credit Lenders, as the case may be, or through any course of conduct or
course of dealing or otherwise, (b) as a result of the Subject Noncompliance
Events, the Restructuring Lenders, pursuant to their respective Restructuring
Lender Documents, have the right to, among other things, (i) terminate their
respective obligations (if any) to make any further loan or other extension of
credit, and (ii) enforce any of their rights and remedies in connection with the
repayment of the Restructuring Lender Obligations, and (c) no Restructuring
Lender has any obligation to enter into this Agreement.
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SECTION 3. RESTRUCTURING PERIOD and extensions of credit.
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3.1 Restructuring Period. During the Restructuring Period, except as
specifically set forth in this Agreement, the Restructuring Lenders will not
exercise any of their respective rights or remedies under the Restructuring
Lender Documents or applicable law with respect to the Subject Noncompliance
Events. For purposes of this Agreement, "Restructuring Period" means the period
commencing on the Effective Date and ending on the earlier of (a) September 14,
2006 and (b) the date the Restructuring Period is terminated upon the occurrence
of any of the events described in Section 6.1 hereof (the "Termination Date").
3.2 Loans and Letters of Credit. Notwithstanding anything to the contrary herein
or in any Restructuring Lender Document, on and after the Effective Date,
Borrower shall not request any loan, letter of credit or other extension of
credit from any Restructuring Lender pursuant to any of the Restructuring Lender
Documents, and no Restructuring Lender shall make any such loan, issue any such
letter of credit or grant any other extension of credit to Borrower; provided,
however, that (a) Borrower may request an extension of an existing letter of
credit or the issuance of a new or replacement letter of credit so long as the
aggregate outstanding face amount of all letters of credit outstanding under the
Restructuring Lender Documents is not at any time in excess of the aggregate
outstanding face amount of all letters of credit that were available to Borrower
under the Restructuring Lender Documents prior to giving effect to this Original
Restructuring Agreement; and (b) Borrower may use its cash in accordance with
and subject to Section 4.3 hereof.
3.3 Interest Rates.
(a) Notwithstanding the terms of the Existing Credit Agreement, on and
after the Effective Date, (i) Borrower shall pay interest on the unpaid
principal amount of all Loans (as defined in the Existing Credit Agreement) at a
rate per annum equal to the sum of the Adjusted Prime Rate (as defined in the
Existing Credit Agreement) from time to time in effect plus 2.0%; and (ii) after
the occurrence of a Termination Event, interest on all outstanding Loans shall
be payable at a rate per annum equal to 3.0% in excess of the interest rate
otherwise applicable to such Loan.
(b) Notwithstanding the terms of the Note Agreements and the Notes (as
defined in the Note Agreements), on and after the Effective Date, (i) Borrower
shall pay interest on the unpaid principal amount of each Note at a per annum
rate of 10.09% and (ii) after the occurrence of a Termination Event, interest on
all outstanding Notes shall be payable at a rate per annum equal to 3.0% in
excess of the interest rate otherwise applicable to such Note.
(c) Notwithstanding the terms of the Line of Credit documents, on and
after the Effective Date, (i) Borrower shall pay interest on the unpaid
principal amount of the Line of Credit Obligations at a rate per annum equal to
the Adjusted Prime Rate (as defined in the Existing Credit Agreement) plus 2.0%
and (ii) after the occurrence of a Termination Event, interest on all of the
outstanding Line of Credit Obligations at a rate per annum equal to 3.0% in
excess of the interest rate otherwise applicable thereto.
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SECTION 4. Restructuring Covenants.
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Borrower agrees that until all of the Restructuring Lender Obligations
have been paid and satisfied in full, Borrower shall perform and observe, and
shall cause each other Company to perform and observe, all of the following
provisions:
4.1 Fees. In addition to the fees set forth in any of the Creditor Documents,
Borrower shall pay to the Collateral Agent, to be distributed on a pro rata
basis to the Creditors, the following restructuring fees:
(a) on September 1, 2003 Borrower shall pay an amount equal to (i) 75
basis points times (ii) the aggregate amount of the Restructuring Lender
Obligations and LIFO Lender Obligations outstanding on such date;
(b) on December 31, 2004 Borrower shall pay an amount equal to (i) 50
basis points times (ii) the aggregate amount of the Restructuring Lender
Obligations and LIFO Lender Obligations outstanding on such date; and
(c) on December 31, 2005 Borrower shall pay an amount equal to (i) 50
basis points times (ii) the aggregate amount of the Restructuring Lender
Obligations and LIFO Lender Obligations outstanding on such date.
For the avoidance of doubt, the foregoing fees are the same as the fees
set forth in Section 4.1 of the LIFO Restructuring Agreement.
4.2 Mandatory Prepayments.
(a) In addition to any mandatory prepayment provisions in any of the
Creditor Documents, Borrower shall pay to the applicable Creditors, as a
mandatory prepayment on their respective LIFO Lender Obligations and, if
applicable, the Restructuring Lender Obligations, the following amounts (each
such payment, an "Additional Prepayment") that shall be applied to such
obligations as set forth below:
(i) on August 31, 2003, an amount equal to $2,340,477;
(ii) on February 28, 2004, an amount equal to $1,000,000; and
(iii) on May 31, 2004, an amount equal to $300,000;
Provided, however, that the amount of any Additional Prepayment may be adjusted,
and Additional Prepayments may added, after, and based upon a review of, the
Budget for any fiscal year, which adjustment or addition shall be effective upon
delivery by the Required Lenders of written notice of such adjustment to
Borrower and, in the case of any addition that is not permitted pursuant to the
Accommodation Agreement, the approval of GM.
(b) Each Additional Prepayment shall be applied, first, to the LIFO
Lender Obligations, if any, and, second, to the Restructuring Lender
Obligations, in each case on a pro rata basis.
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For the avoidance of doubt, the prepayments set forth in subpart (a)
above is the same prepayment as set forth in Section 4.2(a) of the LIFO
Restructuring Agreement.
4.3 Cash Availability; Special Reserve Funds.
(a) Prior to LIFO Repayment Date. At all times prior to the LIFO
Repayment Date, Borrower shall maintain in the Cash Collateral Account an amount
greater than or equal to the lesser of (i) $21,000,000 and (ii) the difference
between $21,000,000 and the Borrowing Base. Borrower may request withdrawals
from the Cash Collateral Account, provided Borrower shall at all times prior to
and immediately after such withdrawal be in compliance with this Agreement. In
connection with the foregoing, Borrower shall deliver to the LIFO Credit
Agreement Agent a Borrowing Base Certificate on the second Business Day of each
week.
(b) After LIFO Repayment Date. At all times on and after the LIFO
Repayment Date, Borrower shall maintain in the Cash Collateral Account an amount
greater than or equal to the lesser of (i) $21,000,000 and (ii) the difference
between $21,000,000 and the Borrowing Base. Borrower may request withdrawals
from the Cash Collateral Account, provided Borrower shall at all times prior to
and immediately after such withdrawal be in compliance with this Agreement. In
connection with the foregoing, Borrower shall deliver to the Collateral Agent a
Borrowing Base Certificate on the second Business Day of each week.
(c) Special Reserve Funds. In addition to the amounts Borrower is
required to maintain in the Cash Collateral Account pursuant to subparts (a) and
(b) above, Borrower shall, subject to the terms and conditions of this section,
at all times maintain at least $6,000,000 of immediately available funds in the
Cash Collateral Account, which funds shall be designated as the "Special Reserve
Funds" (such funds being referred to herein as the "Special Reserve Funds").
Borrower shall be permitted to request the use of the Special Reserve Funds at
any time prior to the Termination Date on the following conditions:
(i) no Termination Event shall exist prior to or immediately
after the receipt of any such Special Reserve Funds;
(ii) the Special Reserve Funds may only be used for (A)
repayment of the principal and interest relating to the Restructuring
Lender Obligations and the LIFO Lender Obligations, (B) the
Restructuring Fees, and (C) if Borrower does not have sufficient
available cash, payment of a fee associated with a Missed Event
pursuant to Section 4.4(b) hereof;
(iii) on the Termination Date, Borrower shall deposit, if
necessary, immediately available funds into the Cash Collateral Account
so that the Special Reserve Funds on deposit therein equal or exceed
$6,000,000; and
(iv) on the Termination Date, the Special Reserve Funds shall
be applied to repay, first, the LIFO Lender Obligations, if any, and,
second, the Restructuring Lender Obligations, in each case on a pro
rata basis.
11
4.4 Strategic Plan.
(a) Borrower shall use its good faith best efforts to (i) refinance all
of the Restructuring Lender Obligations and LIFO Lender Obligations on or before
September 1, 2004 or (ii) sell substantially all of its assets on or before
September 1, 2004, in each case in accordance with the following timeline:
-------------------------------------------------------------------------------
Event Date
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Retention of one or more Investment Advisor acceptable August 31, 2003
to Borrower and the Requisite Restructuring Lenders
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Preparation of Books/Information Memorandum November 30, 2003
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Signing of Confidentiality Agreements and mailing of December 31, 2003
Books/Information Memorandum
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Visitation by potential purchasers/Lenders February 29, 2004
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Delivery of Letter or Letters of Intent April 30, 2004
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Completion of Due Diligence June 1, 2004
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Delivery of Definitive Purchase Agreement/Commitment June 1, 2004
Letter
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Closing/Refinancing September 1, 2004
-------------------------------------------------------------------------------
(b) In the event that Borrower fails to meet any of the foregoing
deadlines (each such deadline, a "Missed Event"), the Borrower will pay to the
Collateral Agent, for the pro rata benefit of the Creditors, a missed event fee
in the amount of $200,000 for each such Missed Event; provided, however, that
Borrower shall not have to pay a Missed Event fee in connection with the final
event set forth above if such event does not occur solely as a result of the
failure of the Creditors to approve the transaction relating to such final
event. Such fees shall be immediately due and payable 15 days after each Missed
Event. The above events and dates may be adjusted as recommended by Borrower's
investment banker as confirmed by FTI/▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ and approved by the
Requisite Restructuring Lenders. For the avoidance of doubt, the occurrence of a
Missed Event shall not constitute a Termination Event hereunder, but the failure
to pay any missed event fee associated therewith when the same is due and
payable shall constitute a Termination Event.
(c) Retention of an Investment Advisor. In connection with the
strategic plan set forth in subpart (a) above, Borrower shall retain an
investment banker (the "Investment Advisor") acceptable to the Requisite
Restructuring Lenders on terms and conditions acceptable to the Requisite
Restructuring Lenders on or before the date set forth above. Each of the
Restructuring Lenders hereby authorizes the Collateral Agent to take such
actions as the Collateral Agent deems appropriate to ensure that Borrower is
able to pay the fees (including any success fees) and expenses of the Investment
Advisor, including, but not limited to, providing that such fees and expenses
may be paid out of the proceeds of any of the Restructuring Lender Collateral.
12
4.5 Financial Reporting.
(a) On or before September 19, 2003, and on or before August 15 of each
year thereafter, Borrower shall deliver a Budget for the forthcoming fiscal year
to each of the Restructuring Lenders.
(b) Within 30 days after the end of each month, Borrower shall deliver
to the Restructuring Lenders a monthly financial reporting package that includes
the items set forth on Exhibit F hereto, and is otherwise in form and detail
satisfactory to the Restructuring Lenders.
4.6 Financial Covenants. The Restructuring Lenders and Borrower agree that the
financial covenants set forth below shall replace the financial covenants set
forth in Section 5.7(b), (c) and (d) of the Existing Credit Agreement and
Section 5.7 of the Note Agreements during the Restructuring Period. Borrower
shall comply at all times with each of the following:
(a) Fixed Charge Coverage Ratio. Borrower shall not suffer or permit at
any time the Fixed Charge Coverage Ratio to be less than the amount set forth
below for each of the time periods ending on or about the dates set forth below:
------------------------------------ ------------------
Fiscal Quarter Minimum
------------------------------------ ------------------
------------------------------------ ------------------
For the four fiscal quarters .96 to 1.00
ending August 31, 2003
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
For the fiscal quarter ending .96 to 1.00
November 30, 2003
------------------------------------ ------------------
------------------------------------ ------------------
For the two fiscal quarters ending .93 to 1.00
February 29, 2004
------------------------------------ ------------------
------------------------------------ ------------------
For the three fiscal quarters .98 to 1.00
ending May 31, 2004
------------------------------------ ------------------
------------------------------------ ------------------
For the four fiscal quarters .95 to 1.00
ending August 31, 2004
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
For the fiscal quarter ending .93 to 1.00
November 30, 2004
------------------------------------ ------------------
------------------------------------ ------------------
For the two fiscal quarters ending .93 to 1.00
February 28, 2005
------------------------------------ ------------------
------------------------------------ ------------------
For the three fiscal quarters .94 to 1.00
ending May 31, 2005
------------------------------------ ------------------
------------------------------------ ------------------
For the four fiscal quarters .99 to 1.00
ending August 31, 2005
------------------------------------ ------------------
------------------------------------ ------------------
13
------------------------------------ ------------------
Fiscal Quarter Minimum
------------------------------------ ------------------
For the fiscal quarter ending 1.68 to 1.00
November 30, 2005
------------------------------------ ------------------
------------------------------------ ------------------
For the two fiscal quarters ending 1.68 to 1.00
February 29, 2006
------------------------------------ ------------------
------------------------------------ ------------------
for the three fiscal quarters 1.64 to 1.00
ending May 31, 2006
------------------------------------ ------------------
------------------------------------ ------------------
For the four fiscal quarters 1.60 to 1.00
ending August 31, 2006 and each
thereafter
------------------------------------ ------------------
(b) [Intentionally left blank.]
(c) Domestic Adjusted EBITDA. Borrower shall not suffer or permit at
any time Domestic Adjusted EBITDA for the most recently completed four fiscal
quarters of Borrower to be less than the amount set forth below for each of the
four fiscal quarter periods ending on or about the dates set forth below:
------------------------------------ ------------------
Fiscal Quarter Minimum
------------------------------------ ------------------
------------------------------------ ------------------
August 31, 2003 $29,366,000
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
November 30, 2003 $30,316,000
------------------------------------ ------------------
------------------------------------ ------------------
February 29, 2004 $31,396,000
------------------------------------ ------------------
------------------------------------ ------------------
May 31, 2004 $31,714,000
------------------------------------ ------------------
------------------------------------ ------------------
August 31, 2004 $32,025,000
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
November 30, 2004 $34,016,000
------------------------------------ ------------------
------------------------------------ ------------------
February 28, 2005 $34,822,000
------------------------------------ ------------------
------------------------------------ ------------------
May 31, 2005 $34,972,000
------------------------------------ ------------------
------------------------------------ ------------------
August 31, 2005 $34,893,000
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
------------------------------------ ------------------
November 30, 2005 $36,842,000
------------------------------------ ------------------
------------------------------------ ------------------
February 29, 2006 $39,468,000
------------------------------------ ------------------
------------------------------------ ------------------
May 31, 2006 $42,210,000
------------------------------------ ------------------
------------------------------------ ------------------
August 31, 2006 and each fiscal $44,673,000
quarter thereafter
------------------------------------ ------------------
(d) Consolidated Capital Expenditures. Borrower shall not suffer or
permit at any time Consolidated Capital Expenditures (as defined in the Existing
Credit Agreement as in effect on the date hereof), for the most recently
completed fiscal year of Borrower, to be greater than the amount set forth below
for each fiscal year set forth below:
14
------------------------------------ ------------------
Fiscal Year Maximum
------------------------------------ ------------------
------------------------------------ ------------------
2003 $13,600,000
------------------------------------ ------------------
------------------------------------ ------------------
2004 $19,047,000
------------------------------------ ------------------
------------------------------------ ------------------
2005 $24,040,000
------------------------------------ ------------------
------------------------------------ ------------------
2006 $15,140,000
------------------------------------ ------------------
provided, however, that any of the financial covenants set forth above (i) will
be adjusted to reflect the impact on such covenants for any fiscal quarter (and
any testing period including such fiscal quarter) following the sale by the
Companies of any business unit sold prior to such fiscal quarter of the
Companies, and (ii) may be adjusted to an amount reasonably acceptable to the
Required Lenders after, and based upon a review of, the Budget for each year,
which adjustment shall be effective upon delivery by the Requisite Restructuring
Lenders of written notice of such adjustment to Borrower.
4.7 Retention of Senior Management. Borrower shall at all times cause the
Retention Agreements to be in full force and effect with respect to ▇▇▇▇▇ ▇.
▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ (or any replacement to any of the
foregoing individuals so long as such replacements are reasonably acceptable to
the Requisite Restructuring Lenders and are subject to a retention agreement
acceptable to the Requisite Restructuring Lenders). Each of the Restructuring
Lenders acknowledges that it has reviewed the Retention Agreement and agrees to
the terms and conditions thereof. Each Restructuring Lender authorizes the
Collateral Agent to acknowledge and agree to the terms of the Retention
Agreement on its behalf and in so doing each Restructuring Lender agrees that
the signature of the Collateral Agent on its behalf shall be as if such
Restructuring Lender were an original signatory thereto.
4.8 Assignment of Commitments. Notwithstanding anything in the Existing Credit
Agreement to the contrary, the Existing Banks shall be permitted to assign all
or any portion of their respective Commitments (as defined in the Existing
Credit Agreement), and all Existing Credit Agreement Obligations then owing to
them, without the consent of Borrower.
SECTION 5. ACCESS AGREEMENT AND ACCOMMODATION AGREEMENT.
--------------------------------------------
5.1 Accommodation Agreement. As a condition precedent to the effectiveness of
this Agreement, the Accommodation Agreement shall have been executed by all of
the parties thereto and become fully effective. Each of the Restructuring
Lenders (i) acknowledges the terms of, consents to and agrees to be bound in all
respects by the Accommodation Agreement, and (ii) agrees that in the event there
is any conflict between the terms and conditions of any of the Restructuring
Lender Documents and the Accommodation Agreement, the terms and conditions of
the Accommodation Agreement shall prevail. Each Restructuring Lender agrees that
the Accommodation Agreement shall be binding on it and its successors and
assigns. In the event that any Restructuring Lender desires to assign all or any
portion of its Restructuring Lender Obligations to any Person, as a condition
precedent to the effectiveness of such assignment, such Restructuring Lender
shall cause such Person to agree in writing to be bound by and to become a party
to the Accommodation Agreement.
15
5.2 Access Agreement. Each of the Restructuring Lenders acknowledges the terms
of and consents to the execution and delivery by Borrower of the Access
Agreement. Notwithstanding any provision in any of the Restructuring Lender
Documents to the contrary, the Access Agreement, and the Liens granted
thereunder, shall be permitted under the Restructuring Lender Documents.
5.3 Authorization of Agent. Each of the Restructuring Lenders (other than the
Noteholders) authorizes the Existing Credit Agreement Agent to enter into the
Accommodation Agreement on its behalf and in so doing each Restructuring Lender
(other than the Noteholders) agrees that the signature of the Existing Credit
Agreement Agent on its behalf shall be as if such Restructuring Lender were an
original signatory thereto.
5.4 Modification to Agreements. Notwithstanding anything in any Restructuring
Lender Document to the contrary, Borrower and the Restructuring Lenders agree
that, (i) the Accommodation Agreement shall not be amended, restated or
otherwise modified in any respect (and no waiver or consent shall be granted
with respect to any of the provisions thereto), unless, in each case, such
amendment, restatement, other modification, consent or waiver is in writing and
signed by all of the Restructuring Lenders, and (ii) the Access Agreement shall
not be amended, restated or otherwise modified in any respect (and no waiver or
consent shall be granted with respect to any of the provisions thereto), unless,
in each case, such amendment, restatement, other modification, consent or waiver
is in writing and consented to by the Collateral Agent acting at the written
direction of the Requisite Restructuring Lenders.
5.5 Further Assurances.
(a) Each of the Restructuring Lenders agrees that it will at all times
take such actions and enter into such agreements as are reasonably necessary to
give effect to and implement the terms of the Accommodation Agreement,
including, but not limited to, executing and delivering an amendment or an
amendment and restatement of its respective Restructuring Lender Documents as
and when required. In the event that any Restructuring Lender fails or refuses
to execute any such amendment or amendment and restatement, the Collateral Agent
shall be permitted and is hereby expressly authorized to execute the same on
behalf of such Restructuring Lender so long as the terms and conditions of such
amendment or amendment and restatement are consistent in all material respects
with the terms and conditions set forth in the Restructuring Lender Documents
and the Accommodation Agreement.
(b) Each of the Restructuring Lenders hereby authorizes the Collateral
Agent to take such actions as are reasonably necessary in its opinion to give
effect to and carry out the terms of the Access Agreement, including, but not
limited to, executing and delivering such UCC amendments or releases as may be
required and entering into a subordination or other intercreditor agreement with
GM.
16
SECTION 6. Termination Events.
------------------
6.1 Termination of Restructuring Period. Upon the occurrence of any
Termination Event and at all times thereafter the Restructuring Period shall
automatically terminate without demand or notice of any kind. For purposes of
this Agreement, "Termination Event" means:
(a) the occurrence of any default or event of default under
any of the Creditor Documents (other than the Subject Noncompliance
Events);
(b) the occurrence of a default under, or the breach by any
Credit Party of any of the provisions of, this Agreement;
(c) if GM resources any business currently produced by or
committed to the Companies in violation of the Accommodation Agreement;
(d) the occurrence of a material default under, or the breach
by any Person a party to the Access Agreement or the Accommodation
Agreement of any of the provisions of, the Access Agreement or the
Accommodation Agreement;
(e) the occurrence of a default, event of default, or
Termination Event (as defined in the LIFO Restructuring Agreement)
under the LIFO Restructuring Agreement;
(f) if a final judgment or order for the payment of money
damages shall be rendered against any Company by a court of competent
jurisdiction, provided that the aggregate of all such judgments for all
such Companies shall exceed $1,000,000 in excess of applicable
insurance coverage;
(g) the failure of the Budget delivered pursuant to Section
4.5(a) hereof to be reasonably acceptable to the Required Lenders; or
(h) any representation or warranty made by any Company under
this Agreement or any agreement, instrument or other document executed
or delivered by any Company in connection with this Agreement is untrue
or incorrect in any material respect when made or any schedule,
certificate, statement, report, financial data, notice or writing
furnished at any time by any Company to any Restructuring Lender is
untrue or incorrect in any material respect on the date as of which the
facts set forth therein are stated or certified.
6.2 Effect at End of Restructuring Period. On the Termination Date, the Subject
Noncompliance Events will be deemed to have continued to exist and, without
regard to any matters transpiring during the Restructuring Period or the
financial condition or prospects of the Companies as of such date, the
Restructuring Lenders (or any thereof) shall be fully entitled to exercise any
rights and remedies they may have under their respective Restructuring Lender
Documents or applicable law.
6.3 ACKNOWLEDGMENT. EACH CREDIT PARTY EXPRESSLY ACKNOWLEDGES AND AGREES THAT THE
RESTRUCTURING PROVISIONS SET FORTH IN THIS AGREEMENT ARE EFFECTIVE ONLY DURING
THE RESTRUCTURING PERIOD AND THAT, AFTER THE TERMINATION DATE, EACH OF THE
RESTRUCTURING LENDER DOCUMENTS WILL BE IN MATERIAL DEFAULT AND THE RESTRUCTURING
LENDERS WILL BE FULLY ENTITLED IMMEDIATELY TO EXERCISE THEIR RIGHTS AND REMEDIES
UNDER THEIR RESPECTIVE RESTRUCTURING LENDER DOCUMENTS OR APPLICABLE LAW WITHOUT
REGARD TO ANY MATTERS TRANSPIRING DURING THE RESTRUCTURING PERIOD OR THE
FINANCIAL CONDITION OR PROSPECTS OF THE COMPANIES. EACH CREDIT PARTY UNDERSTANDS
THAT THE RESTRUCTURING LENDERS ARE EXPRESSLY RELYING ON THE TERMS OF THIS
SECTION AND WOULD NOT HAVE ENTERED INTO THIS AGREEMENT BUT FOR THE
ACKNOWLEDGMENT AND AGREEMENT IN THIS SECTION.
17
6.4 No Waiver. Nothing in this Agreement shall in any way be deemed to be (a) a
waiver of any default or event of default including the Subject Noncompliance
Events or (b) an agreement to forbear from exercising any remedies with respect
to any default or event of default except as specifically set forth in this
Agreement.
6.5 No Contest. Each Credit Party agrees that it shall not dispute the validity
or enforceability of any of the Restructuring Lender Documents, or any of its
obligations thereunder, or the validity, priority, enforceability or extent of
any Restructuring Lender Lien, in any judicial, administrative or other
proceeding, either during or following the expiration or termination of the
Restructuring Period.
SECTION 7. RESTRUCTURING LENDERS' ACKNOWLEDGMENTS.
--------------------------------------
Each of the Restructuring Lenders consents to and acknowledges the
terms of the LIFO Restructuring Agreement. Each of the Restructuring Lenders
agrees that, notwithstanding the restructuring of any of the LIFO Lender
Obligations and the Restructuring Lender Obligations pursuant to Section 6 of
the Accommodation Agreement, the LIFO Lender Obligations shall at all times
remain senior in right of payment and priority in accordance with the terms of
the Subordination Agreement. In the event that the LIFO Lender Obligations and
the Restructuring Lender Obligations are restructured pursuant to such Section 6
of the Accommodation Agreement, such obligations will be restructured in such a
manner as to preserve the priorities set forth in the Subordination Agreement.
SECTION 8. REPRESENTATIONS AND WARRANTIES.
------------------------------
To induce the Restructuring Lenders to enter into this Agreement, the
Credit Parties represent and warrant to the Restructuring Lenders that:
8.1 Due Authorization; No Conflict; No Lien; Enforceable Obligation. The
execution, delivery and performance by the Credit Parties of this Agreement are
within their respective corporate powers, have been duly authorized by all
necessary corporate action, have received all necessary governmental, regulatory
or other approvals (if any is required), do not and will not contravene or
conflict with any provision of (a) any law, (b) any judgment, decree or order or
(c) their respective articles or certificate of incorporation or bylaws and do
not and will not contravene or conflict with, or cause any lien to arise under,
any provision of any agreement or instrument binding upon the Credit Parties (or
any thereof) or upon any of their respective properties. This Agreement and each
of the Creditor Documents to which any Credit Party is a party are its legal,
valid and binding obligations, enforceable against it in accordance with its
terms.
18
8.2 Representations and Warranties; Default. As of the Effective Date, except
for those representations or warranties specifically made as of another date,
the representations and warranties of any of the Credit Parties contained in the
Creditor Documents are true and correct. As of the Effective Date, except for
the Subject Noncompliance Events, no Termination Event exists and no default or
event of default has occurred and is continuing.
SECTION 9. CONDITIONS PRECEDENT.
--------------------
Notwithstanding any other provision contained in this Agreement, the
effectiveness of this Agreement and the obligation of the Restructuring Lenders
to institute the provisions of this Agreement and the commencement of the
Restructuring Period shall be effective on the date (the "Effective Date") on
which the following conditions precedent have been satisfied:
(a) this Agreement shall have been executed by Borrower, the
Collateral Agent and each of the Restructuring Lenders;
(b) Borrower shall have delivered to the Restructuring Lenders
a fully executed amendment or other agreement relating to the CTC
Forbearance Agreement which shall include an extension of the
agreements therein and shall otherwise be in form and substance
satisfactory to the Requisite Restructuring Lenders;
(c) the LIFO Restructuring Agreement shall have been executed
by the parties thereto and all conditions precedent to the
effectiveness thereof shall have been satisfied;
(d) the Access Agreement shall have been executed by the
parties thereto and Borrower shall have delivered a copy of the same to
the Restructuring Lenders;
(e) the Accommodation Agreement shall have been executed by
the parties thereto;
(f) Borrower shall have delivered to the Restructuring Lenders
a fully executed copy of the Retention Agreement;
(g) Borrower shall have delivered to the Restructuring Lenders
a legal opinion together with such other corporate governance or
authorization documents as the Existing Credit Agreement Agent shall
require, each of which shall be in form and substance acceptable to the
Restructuring Lenders;
(h) Borrower shall have paid to the Existing Credit Agreement
Agent the fees agreed to by Borrower in the Agent Fee Letter dated as
of the date hereof;
19
(i) Borrower shall have paid all out-of-pocket costs and
expenses of each Restructuring Lender, including the fees and
out-of-pocket charges of counsel for each such Restructuring Lender;
and
(j) the Credit Parties shall have delivered such other
documents and shall have satisfied such other conditions as the
Restructuring Lenders may reasonably request.
SECTION 10. MISCELLANEOUS.
-------------
10.1 Captions. The Preliminary Statements to this Agreement (except for any
definitions set forth therein) and the section captions used in this Agreement
are for convenience only and do not affect the construction of this Agreement.
10.2 Release. AS A CONDITION PRECEDENT TO THE EFFECTIVENESS OF THIS AGREEMENT,
AND IN CONSIDERATION OF THE MUTUAL COVENANTS CONTAINED HEREIN AND FOR OTHER GOOD
AND VALUABLE CONSIDERATION, EACH CREDIT PARTY HEREBY HOLDS HARMLESS, RELEASES,
ACQUITS AND FOREVER DISCHARGES THE EXISTING CREDIT AGREEMENT AGENT, THE
COLLATERAL AGENT AND EACH RESTRUCTURING LENDER THAT IS A PARTY HERETO, THE
RESPECTIVE PARTICIPANTS, SUBSIDIARIES, AFFILIATES, OFFICERS, DIRECTORS, AGENTS,
EMPLOYEES, SERVANTS, ATTORNEYS AND REPRESENTATIVES, AS WELL AS THE RESPECTIVE
HEIRS, PERSONAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS OF ANY AND ALL OF THEM
(COLLECTIVELY, THE "RELEASED PARTIES") FROM ANY AND ALL CLAIMS, DEMANDS, DEBTS,
ACTIONS, CAUSES OF ACTION, SUITS, CONTRACTS, AGREEMENTS, OBLIGATIONS, ACCOUNTS,
DEFENSES, OFFSETS AND LIABILITIES OF ANY KIND OR CHARACTER WHATSOEVER, KNOWN OR
UNKNOWN, SUSPECTED OR UNSUSPECTED, IN CONTRACT OR IN TORT, AT LAW OR IN EQUITY,
THAT ANY SUCH CREDIT PARTY EVER HAD, NOW HAVE, OR MIGHT HEREAFTER HAVE AGAINST
ANY RELEASED PARTY, JOINTLY OR SEVERALLY, FOR OR BY REASON OF ANY MATTER, CAUSE
OR THING WHATSOEVER OCCURRING BEFORE THE DATE OF THIS AGREEMENT, INCLUDING
WITHOUT LIMITATION, ANY OF THE FOREGOING THAT RELATE TO, IN WHOLE OR IN PART,
DIRECTLY OR INDIRECTLY, THIS AGREEMENT OR ANY RESTRUCTURING LENDER DOCUMENT. IN
ADDITION, EACH CREDIT PARTY AGREES NOT TO COMMENCE, JOIN IN OR PROSECUTE ANY
SUIT OR OTHER PROCEEDING THAT IS ADVERSE TO ANY OF THE RELEASED PARTIES ARISING
DIRECTLY OR INDIRECTLY FROM ANY OF THE FOREGOING MATTERS. THE CREDIT PARTIES
AGREE TO INDEMNIFY AND HOLD HARMLESS THE RELEASED PARTIES FROM ANY LOSS OR
DAMAGES, CLAMS, COSTS AND ATTORNEY FEES OR EXPENSES ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT OR ANY RESTRUCTURING LENDER DOCUMENT.
10.3 Restructuring Lender Documents Unaffected. Except as herein otherwise
specifically provided, all provisions of the Restructuring Lender Documents
shall remain in full force and effect and be unaffected hereby.
20
10.4 Amendments or Modifications. No amendment, modification, termination, or
waiver of any provision of this Agreement, nor consent to any variance hereto,
shall be effective unless the same shall be in writing and signed by the
Requisite Restructuring Lenders and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, however, that (a) the Accommodation Agreement may only be
amended or modified in accordance with Section 5.4 hereof, and (b) if any
amendment, modification, waiver or consent relating to this Agreement would
require the consent of all of the Existing Credit Agreement Banks under the
Existing Credit Agreement, then, in each such case, such amendment,
modification, waiver or consent relating to this Agreement shall be in writing
and signed by the Requisite Restructuring Lenders and all of the Existing Credit
Agreement Banks.
10.5 No Other Promises or Inducements. There are no promises or inducements that
have been made to any party hereto to cause such party to enter into this
Agreement other than those that are set forth in this Agreement. This Agreement
has been entered into by each Credit Party freely, voluntarily, with full
knowledge, and without duress, and, in executing this Agreement, no Credit Party
is relying on any other representations, either written or oral, express or
implied, made to such Credit Party by any Restructuring Lender. Each Credit
Party agrees that the consideration received by such Credit Party under this
Agreement has been actual and adequate.
10.6 No Waiver of Rights. No waiver shall be deemed to be made by any party
hereunder of any of its rights hereunder unless the same shall be in writing
signed on behalf of such party; provided that the Existing Credit Agreement
Agent shall have the right to act on behalf of the Existing Credit Agreement
Banks pursuant to and in accordance with the terms of the Existing Credit
Agreement. Each waiver, if any, shall be a waiver only with respect to the
specific instance involved and shall in no way impair the rights of any party or
the obligations of the Restructuring Lenders to the LIFO Lenders in any other
respect at any other time.
10.7 Successors and Assigns. This Agreement is binding upon the Credit Parties,
the Restructuring Lenders signatory hereto and their respective successors and
assigns, and inures to the sole benefit of the Credit Parties, the Restructuring
Lenders signatory hereto and their successors and assigns. No Credit Party has
any right to assign its rights or delegate their duties under this Agreement.
10.8 Continued Effectiveness. Notwithstanding anything contained in this
Agreement, the terms of this Agreement are not intended to and do not serve to
effect a novation as to any Restructuring Lender Document. The parties to this
Agreement expressly do not intend to extinguish any Restructuring Lender
Document. Instead, the parties to this Agreement expressly intend to reaffirm
the indebtedness created under the Restructuring Lender Documents. The
Restructuring Lender Documents remain in full force and effect and the terms and
provisions of the Restructuring Lender Documents are ratified and confirmed.
Notwithstanding the foregoing, it is expressly understood and agreed that this
Agreement is an amendment and restatement of the Original Restructuring
Agreement. Upon the effectiveness of this Agreement, the Original Restructuring
Agreement shall be deemed replaced and no longer in effect.
21
10.9 Tolling. Any and all statutes of limitations, repose or similar legal
constraints on the time by which a claim must be filed, a person given notice
thereof, or asserted, that expire, run or lapse during the Restructuring Period
on any claims that any Restructuring Lender signatory hereto may have against
any Credit Party or any other persons relating to any of the Credit Parties
(collectively, the "Restructuring Period Statutes of Limitation") will be tolled
during the Restructuring Period. Each Credit Party waives any defense they may
have against any of the Restructuring Lenders signatory hereto under the
Restructuring Period Statutes of Limitation, applicable law or otherwise solely
as to the expiration, running or lapsing of the Restructuring Period Statutes of
Limitation during the Restructuring Period.
10.10 Revival of Obligations. If all or any part of any payment under or on
account of the Restructuring Lender Documents, this Agreement or any agreement,
instrument or other document executed or delivered by any Credit Party in
connection with this Agreement is invalidated, set aside, declared or found to
be void or voidable or required to be repaid to the issuer or to any trustee,
custodian, receiver, conservator, master, liquidator or any other person
pursuant to any bankruptcy law or pursuant to any common law or equitable cause
then, to the extent of such invalidation, set aside, voidness, voidability or
required repayment, such payment would be deemed to not have been paid, and the
obligations of such Credit Party in respect thereof shall be immediately and
automatically revived without the necessity of any action by the Restructuring
Lenders signatory hereto.
10.11 Fees and Expenses. Borrower shall pay all fees and expenses of each
Restructuring Lender (including, but not limited to, reasonable attorneys fees)
that Borrower is required to pay pursuant to the terms of the Restructuring
Lender Documents within ten Business Days after receiving an invoice therefor.
10.12 Governing Law. This Agreement shall be construed according to the laws of
the State of Ohio, without regard to principles of conflicts of laws.
10.13 Entire Agreement. This Agreement sets forth the entire agreement and
understanding among the parties as to the subject matter hereof and merges and
supersedes all prior discussions, agreements, and undertakings of every kind and
nature among them with respect to the subject matter hereof.
10.14 Counterparts. This Agreement may be executed in any number of
counterparts, and by the parties hereto on the same or separate counterparts and
by facsimile signature, and each such counterpart, when executed and delivered,
shall be deemed to be an original, but all such counterparts shall together
constitute but one and the same Agreement.
10.15 Notices.
(a) All notices, requests, demands and other communications provided
for hereunder shall be in writing and mailed or delivered to any party,
addressed to the address of such party specified on the signature page of this
Agreement. All notices, statements, requests, demands and other communications
provided for hereunder shall be deemed to be given or made when delivered or 48
hours after being deposited in the mails with postage prepaid by registered or
certified mail, addressed as aforesaid, or sent by facsimile with telephonic
confirmation of receipt, except that notices pursuant to any of the provisions
hereof shall not be effective until received.
22
(b) In addition to any notice requirements that exist under the
Existing Credit Agreement, LIFO Credit Agreement or Note Agreements, the Credit
Parties shall send a copy of all notices and reports (including, but limited to
financial statements or a strategic plan) that it sends to the Existing Credit
Agreement Agent, LIFO Credit Agreement Agent or Collateral Agent to those
individuals listed on Exhibit E hereto, which notices and reports shall be
transmitted simultaneously with the others.
10.16 Jurisdiction and Venue. All judicial proceedings arising out of or
relating to this Agreement or any obligation hereunder shall be brought in the
United States District Court for the Northern District of Ohio or in the Court
of Common Pleas, Cuyahoga County, Ohio, and by their respective execution and
delivery of this Agreement, the undersigned accept for themselves and in
connection with their properties, generally and unconditionally, the
jurisdiction of the aforesaid courts and waive any defense of forum
nonconveniens, and irrevocably agree to be bound by any judgment rendered
thereby in connection with this Agreement.
10.17 Severability of Provisions; Attachments. Wherever possible each provision
of this Agreement shall be interpreted in such manner as to be effective and
valid under applicable law. Any provision of this Agreement that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction. Each schedule or
exhibit attached to this Agreement shall be incorporated herein an shall be
deemed to be a part hereof.
10.18 Legal Representation of Parties. This Agreement was negotiated by the
parties with the benefit of legal representation and any rule of construction or
interpretation otherwise requiring this Agreement to be construed or interpreted
against any party shall not apply to any construction or interpretation hereof
or thereof.
10.19 JURY TRIAL WAIVER. EACH OF THE UNDERSIGNED, TO THE EXTENT PERMITTED BY
LAW, HEREBY WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE
WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, AMONG THEM, OR ANY OF THEM,
ARISING OUT OF, IN CONNECTION WITH, RELATED TO OR INCIDENTAL TO THE RELATIONSHIP
ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY DOCUMENT
EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED
THERETO. THIS WAIVER SHALL NOT IN ANY WAY AFFECT, WAIVE, LIMIT, AMEND OR MODIFY
THE ABILITY OF ANY OF THE UNDERSIGNED TO PURSUE REMEDIES PURSUANT TO ANY
CONFESSION OF JUDGMENT OR COGNOVIT PROVISION CONTAINED IN ANY NOTE OR OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT AMONG THE UNDERSIGNED.
[Remainder of page intentionally left blank.]
23
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date referenced in the first paragraph of this Agreement.
BORROWER:
AMCAST INDUSTRIAL CORPORATION
By:_________________________________
Name:______________________________
Title:_______________________________
GUARANTORS:
ELKHART PRODUCTS CORPORATION
By:_________________________________
Name:______________________________
Title:_______________________________
AMCAST AUTOMOTIVE OF INDIANA,
INC.
By:_________________________________
Name:______________________________
Title:_______________________________
AS INTERNATIONAL, INC.
By:_________________________________
Name:______________________________
Title:_______________________________
IZUMI, INC.
By:_________________________________
Name:______________________________
Title:_______________________________
AMCAST CASTING TECHNOLOGIES,
INC.
By:_________________________________
Name:______________________________
Title:_______________________________
24
AMCAST INDUSTRIAL FINANCIAL
SERVICES, INC.
By:_________________________________
Name:______________________________
Title:_______________________________
AMCAST INVESTMENT SERVICES
CORPORATION
By:_________________________________
Name:______________________________
Title:_______________________________
CASTING TECHNOLOGY COMPANY
By: Amcast Casting Technologies, Inc., General Partner
By: __________________________
Name:________________________
Title:_________________________
25
RESTRUCTURING LENDERS:
KEYBANK NATIONAL ASSOCIATION,
as Existing Credit Agreement Agent, an
Existing Credit Agreement Bank, a Line of
Credit Lender and as the Collateral Agent
By:
Name:
Title:
THE BANK OF NEW YORK
By:
Name:
Title:
BANK ONE INDIANA, N.A.
By:
Name:
Title:
CREDIT AGRICOLE INDOSUEZ
By:
Name:
Title:
and
Name:
Title:
HIGHLAND LEGACY LIMITED
By: Highland Capital Management, L.P.,
as Collateral Manager
By:
Name:
Title:
26
U.S. BANK
NATIONAL
ASSOCIATION
(successor to
Firstar Bank,
N.A.),
as an Existing Credit Agreement Bank and
a Line of Credit Lender
By:
Name:
Title:
COMERICA BANK
By:
Name:
Title:
PAMCO CAYMAN LTD.
By: Highland Capital Management, L.P.,
as Collateral Manager
By:
Name:
Title:
ABELCO FINANCE, LLP
By:
Name:
Title:
27
SAN PAOLO IMI S.p.A.
By:
Name:
Title:
and
Name:
Title:
PRINCIPAL LIFE INSURANCE
COMPANY
By:
Name:
Title:
and
Name:
Title:
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By:
Name:
Title:
28
Exhibit A
Outstanding Indebtedness as of August 28, 2003
[See attached]
29
Exhibit B
Existing Bank Noncompliance Events
1. The events of noncompliance set forth in subpart (a) of Section 2.2 of
the Subordination Agreement.
2. The failure to comply with Section 7.1 of the Existing Credit Agreement
(as such section relates to the payment of principal) on September 14,
2002.
3. The noncompliance with Section 7.5 of the Existing Credit Agreement as
a result of the Subject Line of Credit Noncompliance Events, the
Subject Noteholder Noncompliance Events, noncompliance with the CTC
Guaranty, and the Subject Noncompliance Events (as defined in the LIFO
Restructuring Agreement).
30
Exhibit C
Subject Noteholder Noncompliancce Events
1. Failure to make the sinking fund payments due November 2002.
2. Failure to repay the Noteholder Obligations when due on November __,
2003.
3. The noncompliance with Section 6.1(g) of the Note Agreements Agreement
as a result of the Existing Bank Noncompliance Events, the Subject Line
of Credit Noncompliance Events, noncompliance with the CTC Guaranty,
and the Subject Noncompliance Events (as defined in the LIFO
Restructuring Agreement).
31
Exhibit D
Subject Line of Credit Noncompliance Events
1. KeyBank National Association - The events of noncompliance set forth in
subpart (c) of Section 2.2 of the Subordination Agreement.
2. U.S. Bank National Association - Failure to pay debt at September 2002
maturity date and the Event of Default that exists as a result of
Existing Bank Noncompliance Events.
32
Exhibit E
Additional Notice Information
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Principal Life Insurance Principal Life Insurance
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
P: ▇▇▇-▇▇▇-▇▇▇▇ P: ▇▇▇-▇▇▇-▇▇▇▇
F: ▇▇▇-▇▇▇-▇▇▇▇ F: ▇▇▇-▇▇▇-▇▇▇▇
E: ▇▇▇▇▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇ E: ▇▇▇▇▇▇▇▇.▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Northwestern Mutual Mayer, Brown, ▇▇▇▇ & Maw
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
P: ▇▇▇-▇▇▇-▇▇▇▇ P: ▇▇▇-▇▇▇-▇▇▇▇
F: ▇▇▇-▇▇▇-▇▇▇▇ F: ▇▇▇-▇▇▇-▇▇▇▇
E: ▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ E: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
--------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
Mayer, Brown, ▇▇▇▇ & Maw Northwestern Mutual
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
P: 312-701-7858 P:
F: ▇▇▇-▇▇▇-▇▇▇▇ F:
E: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ E: ▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
33
Exhibit F
Description of Monthly Reporting Package
1. Consolidated operating statements (Month & YTD) vs. Plan vs. prior year
by facility
2. 13 week running cash flow forecast
3. Income statements by facility-trend report
4. Balance sheets by facility-trend report
5. Accounts Receivables - borrowing base - consolidated and by facility
6. Cash call weekly trend reports by facility. Tracks inventory , past
dues, labor cost, capital expenditures and headcount
7. Cash call end of month report - tracks by facility: receivables,
payables, capital expenditures and performance cash flow.
8. Capital Expenditures - formal Amcast report
9. Cost Reductions - formal Amcast report
10. ▇▇▇▇▇▇▇ status - formal Amcast report
11. Past due receivable trend report - consolidated, by facility
12. Profit drivers - formal Amcast report
13. Report of major new projects, concerns, etc - "State of Amcast"
14. Last twelve months Consolidated EBITDA and revenues on a consolidated
basis
34