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EXHIBIT 99.17
[TRANSLATION FROM THE GERMAN LANGUAGE]
LOAN AGREEMENT
(Final Version, as signed on September 29, 1997)
between ▇▇▇▇▇▇▇ 97 VERMOGENSVERWALTUNGS GMBH, MUNICH
hereinafter referred to as "Borrower"
and DRESDNER BANK AG, STUTTGART
hereinafter referred to as "Dresdner Bank AG" or "Bank"
PREAMBLE
Decora Industries Inc., New York (hereinafter referred to as "Decora"), intends
to acquire up to 100 % of shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG, Wei(beta)bach, for a
total amount of DM 79,800,000.- via the Borrower which has been acquired for
this purpose. In this context, it is also intended to restructure the existing
payment obligations of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG.
In this context, the Borrower has acquired, free of rights of third parties,
approximately 51.2 % of shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG for a purchase price of
DM 46,690,700.- pursuant to purchase agreement of August 18, 1997 (ANNEX 1A) and
approximately 22 % of shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG for a purchase price of DM
14,891,580.- pursuant to purchase agreement of September 3, 1997 (ANNEX 1B). A
further approximately 1.8 % of shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG will be acquired
shortly for a purchase price of DM 1,250,000.-. The ancillary transaction costs
for the acquisition of such 75 % of shares amount to DM 1,100,000.-. For
purposes of the acquisition of the above-mentioned 75 % of shares in ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ AG and in order to cover
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the ancillary transaction costs, the Borrower will be provided by Decora with
equity in the amount of DM 26,689,250.-; additionally, funds from an acquisition
loan in the amount of DM 37,310,750.- will be made available.
Object of business of the Borrower is in particular the management of its own
assets.
The financing of the transaction is contemplated as follows:
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ORIGIN OF FUNDS DM Use of Funds DM %
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Purchase Price 62,832,280.- Equity 26,689,250.- 42%
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Interest on 67,720.- Acquisition 37,310,750.- 58%
Purchase Price Loan
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Transaction 1,100,000.-
Cost
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TOTAL 64,000,000.- Total 64,000,000.- 100%
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The acquisition of these 75 % of shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG will be effected
in a "first step". In addition thereto, it is contemplated and required that
immediately after the acquisition of 75 % of shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG, in
a "second step" a public offer pursuant to the German Take-Over Code for the
acquisition of the remaining 25 % of shares will be prepared. It is contemplated
that this measure and the intended restructuring of existing payment obligations
of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG in the maximum amount of DM 40,000,000.- will be
effected within 18 months after execution of this loan agreement under the
leadership of Dresdner Bank AG.
Now therefore, the Bank declares to be willing to make available to the Borrower
in the "first step" the following loan, subject to the following conditions and
on the basis of the general terms and conditions of the Bank which are attached
as ANNEX 1C (hereinafter referred to as "AGB").
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1. LOAN
ACQUISITION LOAN IN THE TOTAL AMOUNT OF DM 37,310,750.-
(in words: German marks thirty-seven million three hundred ten thousand
seven hundred fifty)
The loan shall be syndicated at a later point in time. In the meantime,
Dresdner Bank AG declares to be willing to make available the whole
amount of the loan.
2. DRAWING MODALITIES
The loan can be drawn by the Borrower in one amount after all payment
conditions pursuant to no. 10 have been met. The loan amount will be
made available to the Borrower by Dresdner Bank AG on its account no. 9
190 600 01 at Dresdner Bank AG Stuttgart under the proviso that this
amount can only be used in accordance with no. 3 of this agreement. The
loan cannot be revalued [ist nicht revalutierbar].
3. PURPOSE OF USE
The loan is made available to the Borrower exclusively for the purpose
of partly financing the purchase price for the acquisition of 75 % of
shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG as described in the Preamble including
the consideration for the non-compete covenant of ▇▇▇▇ Holding KG and of
partly covering the ancillary transaction costs. Upon request, the use
of the loan has to be evidenced to the Bank.
4. TERMS AND CONDITIONS
The following terms and conditions shall apply:
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4.1 INTEREST RATE on the basis of 3- or 6-months-DM-LIBOR (as ascertained by
Dresdner Bank AG two banking days before drawing) plus a MARGIN OF 2.5 %
P.A.. The interest is calculated on the basis of 365/360 days.
4.2 The PAYMENT will be made at 100%.
4.3 INTEREST is due and payable in arrears at the end of an interest period,
at the latest, however, every three months.
4.4 Interest has to be made available by the Borrower at the respective due
date on the account no. 9 190 600 00 at Dresdner Bank AG.
4.5 The first interest period is 3 months. Thereafter, the choice of the
interest period has to be made three banking days before the beginning
of the respective interest period. In case that the Bank will not be
informed three banking days before the beginning of an interest period
about the chosen time period, the preceding interest period shall be
applicable.
4.6 DM-LIBOR is defined as London Inter Bank Offered Rate for the legal
currency of the Federal Republic of Germany as ascertained by the Bank
two banking days each before the beginning of the first or the expiry of
the preceding interest period at 11.00 a.m. London time. A DM-LIBOR
quotation can only be made if corresponding funds are made available on
the money market. If, at any time during the term of the LOAN, no
DM-LIBOR quotations are available, Dresdner Bank AG will request from
two banks which are situated in Frankfurt am Main and which are not
involved in the transaction, offering quotations [Einstandssatze Brief]
for loans with corresponding durations, the average [einfacher
Mittelwert] of which shall substitute DM-LIBOR as the basis for the
calculation of interest.
4.7 Banking days are days on which the offices of the Bank in Stuttgart and
of banks in London and Frankfurt am Main are generally open for
business.
5. COMMISSIONS
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5.1 Commitment commission 0.5 % p.a. on the committed but not used loan. The
commission will be calculated on the basis of 360/360 days, commencing
with the signing of the loan agreement. The account no. 9 190 600 00 at
the Bank will be debited monthly in arrears with the commitment
commission.
5.2 Front-end fee 2.0 % one time on the total amount of the loan, payable on
the day of first use of the loan. The Bank is entitled to debit any
accounts of the Borrower with the Bank with the front-end fee (invoice
will be prepared separately). If a work fee has been paid in the course
of the retainer agreement of August 18, 1997, this will be credited
against the front-end fee.
6. DURATION
The LOAN is time-wise limited until September 30, 2004.
7. REPAYMENT
7.1 The loan has to be repaid in installments according to the following
repayment schedule, beginning on March 30, 1999. Until then, repayments
are suspended. Final installment is due and payable on September 30,
2004. To the extent that the aforementioned dates are no banking days,
repayment has to be effected on the preceding banking day, respectively.
Repaid amounts cannot be revalued [sind nicht revalutierbar].
PAYMENT ON INSTALLMENT REMAINING BALANCE
March 30, 1998 Repayment suspended 37,310,750.-
September 30, 1998 Repayment suspended 37,310,750.-
March 30, 1999 2,950,000.- 34,360,750.-
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PAYMENT ON INSTALLMENT REMAINING BALANCE
September 30, 1999 2,950,000.- 31,410,750.-
March 30, 2000 2,900,000.- 28,510,750.-
September 30, 2000 2,900,000.- 25,610,750.-
March 30, 2001 3,150,000.- 22,460,750.-
September 30, 2001 3,150,000.- 19,310,750.-
March 30, 2002 3,200,000.- 16,110,750.-
September 30, 2002 3,200,000.- 12,910,750.-
March 30, 2003 3,300,000.- 9,610,750.-
September 30, 2003 3,300,000.- 6,310,750.-
March 30, 2004 3,300,000.- 3,010,750.-
September 30, 2004 3,010,750.- 0.-
The respective amounts to be repaid have to be made available by the
Borrower for debiting on the respective due date on the account no. 9
190 600 00 of the Borrower with Dresdner Bank AG.
If amounts which are due and payable in connection with this loan
agreement are not paid by the Borrower, the Borrower will be in default
of payment without a payment demand being required. For the duration of
the default of payment, the Borrower is obliged to pay default interest
on the outstanding due amounts to be repaid at a rate of 5 percentage
points over the applicable discount rate of Deutsche Bundesbank (or the
rate which substitutes the discount rate of Deutsche
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Bundesbank pursuant to Section 11 para. 1 German Consumer Credit Act
[Verbraucherkreditgesetz] or - if such rate should not be available - a
rate which is designated by the Bank pursuant to Section 315 German
Civil Code) for the time period from due date until receipt of the
amounts by the bank. If the Borrower is in default of payment with
respect to interest payments, the Borrower shall be obliged to pay
liquidated damages to the banks [should read: Bank]. The amount of
liquidated damages equals to an interest rate of 5 percentage points
over the applicable discount rate of Deutsche Bundesbank (or, after its
abolition, the aforementioned corresponding rate) for the time period
from due date to the receipt of the amounts by the Bank. The Borrower is
free to prove that a damage has not occurred or not in the asserted
amount, whereas the Bank has the right to assert exceeding damages.
7.2 Premature repayments can be made at the end of each interest period with
a minimum amount of DM 500,000.- or a multiple thereof, and such
payments will be credited against the respective last repayment
installments in a time- wise order ("inverse order of maturity"). The
Borrower has to inform the Bank of any intended premature repayment at
least five banking days before the end of the respective interest
period.
7.3 In addition to the repayment conditions pursuant to no. 7.1, the loan
has to be repaid by the excess-cash-flow of the Borrower (as determined
pursuant to ANNEX 7.3) while taking into consideration the respective
interest period. The excess-cash-flow shall be determined on the basis
of the audited annual accounts and has to be used for repayment upon
expiry of the respective interest period which is applicable on such
date referred to in no. 9.1.1. The crediting shall be made in accordance
with no. 7.2.
8. COLLATERAL
8.1.1 First-rank pledge of the existing and future shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
AG which are owned by the Borrower by pledge of the securities account
for purposes of holding such shares in custody of the Borrower with the
Bank, account no. 9
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190 600 00, pursuant to form no. A 1625 (ANNEX 8.1.1).
8.1.2 Pledge of the shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG which have been acquired
from ▇▇▇▇ Holding KG pursuant to form no. A 1626 (ANNEX 8.1.2) by
assignment of the claim for delivery against Deutsche Bank AG (Annex 1a,
Section 3 para 1). The Borrower hereby irrevocably authorizes the Bank
to procure in the name of the Borrower the transfer of these shares from
Deutsche Bank AG to the securities account referred to in no. 8.1.1.
8.1.3 Pledge of the shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG which have been acquired
from Baden-Wurttembergische Bank AG pursuant to form no. A 1626 (ANNEX
8.1.3) which are or will be, respectively, kept in save custody on a
securities account of the Borrower at Baden-Wurttembergische Bank AG
(Annex 1b, Section 3 para1). The Borrower hereby irrevocably authorizes
the Bank to procure in the name of the Borrower the transfer of these
shares from Baden-Wurttembergische Bank AG to the securities account
referred to in no. 8.1.1.
8.2 Guarantee of Decora Industries, Inc. ["Decora"], in the amount of
DM 5,000,000.- pursuant to form no. A 1604 f (ANNEX 8.2).
8.3 Obligation of Decora to pay such interest for the loan which becomes due
and payable before the first repayment installment becomes due and
payable pursuant to no. 7.1; such amounts have to be made available to
the Borrower by Decora as subordinated shareholder's loans (ANNEX 8.3).
8.4 Decora will undertake pursuant to ANNEX 8.3 to make a public tender
offer to the minority shareholders of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG pursuant to
the German Takeover Code. Decora - via the Borrower - may have the
option to make either a cash offer or an exchange offer of shares in
Decora for shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG. In either case the ratio of
equity to debt at the Borrower will be 47 % to 53 % following the
completion of the takeover of all those shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG
as acquired by the Borrower. If Decora elects to make - via the Borrower
- the offer in cash, Decora will place such funds which are necessary to
achieve the equity portion of 47 % following the takeover of all those
shares in Konrad
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Hornschuch AG as acquired by the Borrower, in cash in an account with
the Bank prior to making the public tender offer.
8.5 Declaration of subordination along with obligation to retain the loaned
amounts to the Borrower with respect to all existing and future
shareholder's loans to the Borrower pursuant to form no. A1613 of
Dresdner Bank AG (ANNEX 8.5).
Additionally, the collateral secures all existing, future and contingent claims
of the Bank along with all of its domestic and foreign branches resulting from
the banking relationship with the Borrower. Details have been or will be -
respectively - determined upon granting of the respective collateral.
Additionally, the pledge and security rights which are stipulated in the AGB of
the Bank shall serve as collateral for the loan. In case of an increase of the
risk which may occur later on, the Bank is furthermore allowed to demand an
improvement of the collateral or the granting of additional collateral.
9. CONDITIONS
9.1 The Borrower will inform the Bank during the duration of the loan
(including extensions) regularly about the development of its economical
conditions and will, for these purposes, submit without delay and
without being requested at least the following documents - with which
the Bank is satisfied.
9.1.1 ANNUAL ACCOUNTS of the Borrower and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG, each separate
and consolidated, which have been audited by an auditor or an auditing
firm, including the notes [Anhang], management report [Lagebericht] and
auditor's report, at the latest 120 days after the end of the respective
business year.
9.1.2 QUARTERLY STATUS of Borrower and of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG, each separate
and consolidated, comprising balance sheet, profit and loss account and
cash flow calculation of the current period and a comparison to the
business plan, prepared
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by the respective management, at the latest 45 days after the end of the
respective quarter.
9.1.3 Monthly FIGURES of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG with respect to the turnover and
profit situation including comparison of projected and actual figures
for each month and on a cumulated basis, at the latest 25 days after the
end of the respective month.
9.1.4 Detailed BUSINESS PLANS for the respective next business year for the
Borrower and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG, comprising statements as to the
planned development of turnover and profit, projective balance sheets
and a liquidity projection as well as basic figures of the strategic
planning for the next three years, at the latest 30 days before the end
of the respective business year.
9.1.5 Confirmation by an auditor or an auditing firm in accordance with ANNEX
9.1.5 with respect to compliance with the key financial figures of the
Borrower, at the latest 120 days after the end of the respective
business year; upon request of the Bank in shorter time periods.
The Borrower is obliged to comply with the key financial figures as
listed in ANNEX 9.1.5 during the whole duration of the loan and to
inform the Bank immediately of any deviations therefrom. In addition
thereto, the Borrower will inform the Bank about the reasons which have
led to deviations and will explain the measures which have been or will
be taken in order to regain compliance with the key financial figures.
In case of non-compliance with the key figures, the Borrower is granted
a period of 60 days after the date of realization of non-compliance by
the Borrower in order to regain compliance with the key figures; during
this time period, the Bank has the right to reject any further drawings
of the loan.
In addition thereto, the Borrower will inform the Bank immediately about
any business developments which are deviating from the business plan as
applicable from time to time, irrespective of its information duties
pursuant to no. 9.1.
9.2. The Borrower will inform the Bank in writing about the following
business incidents before any contractual obligations are concluded:
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9.2.1 ACQUISITIONS OF TANGIBLE ASSETS OR FINANCIAL ASSETS which exceed 120 %
of the respective annual figures of the business plan of the borrower
for the current business year.
9.2.2 Additional use/assumption of LOAN LIABILITIES - comprising liabilities
which are similar to a loan (e.g. Euronotes, leasing) or guarantee
credits [Avalkredite] of whatever kind including repurchase obligations
in the course of sales financing.
9.2.3 That GRANTING OF LOANS or ASSUMING of suretyships, guarantees of
whatever kind or similar obligations vis-a-vis or in favor of group
companies of the Borrower or other third parties. Exempted therefrom is
the granting of credit periods vis-a-vis trade debtors in the ordinary
course of business.
9.2.4 Granting of assets which are owned at present or will be in future
(including current assets) as COLLATERAL to any other creditor. Exempted
therefrom is the agreement on usual retentions of title in favor of
suppliers in the ordinary course of business.
9.2.5 SALE or any other disposal of ASSETS which are owned at present or will
be in future (including current assets) which are of relevance for the
business activities of the Borrower. Exempted therefrom is the sale of
assets in the ordinary course of business which, however, does not
comprise factoring or leasing transactions.
9.2.6 SALE of current or future PARTICIPATIONS by the Borrower.
9.2.7 ACQUISITION OR ESTABLISHING OF COMPANIES - directly or via subsidiaries
or further third parties as well as transformations, spin-offs or
mergers, including a transformation involving ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG.
9.2.8 All business incidents which do or might have a substantial NEGATIVE
IMPACT ON THE ASSETS- LIQUIDITY- AND EARNINGS SITUATION of the Borrower.
9.2.9 Any CHANGES of the MANAGEMENT TEAM of the Borrower.
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9.2.10 Payment of MANAGEMENT FEES of whatever kind exceeding in total DM
100,000.- p.a.
9.2.11 Any LITIGATIONS/LEGAL DISPUTES of the Borrower, which together exceed a
total amount of DM 100,000.-.
9.2.12 Change of the AUDITOR or the AUDITING FIRM.
9.2.13 Changes in the SHAREHOLDER STRUCTURE.
9.2.14 Conclusion, amendment or termination of CONTRACTS of whatever kind with
shareholders or subsidiaries of the Borrower or with persons which are
related to the shareholders or subsidiaries, comprising also companies
in which these hold directly or indirectly a participation.
In case of intended measures pursuant to nos. 9.2.1 - 9.2.14, the
Borrower will explain in writing to the Bank whether and how these
measures do or might affect the risk position of the bank. The Bank
decides in its own discretion (Section 315 German Civil Code) upon
written request by the Borrower within thirty banking days - after
receipt of reasonable documentation and information which are relevant
for its decision - to what extent a negative impact on the risk position
has to be expected in the Bank's view. The scope of documents which are
relevant for the decision is determined by the Bank.
9.3 In order to limit the risk resulting from changes of interest rates for
the loan, satisfying hedging strategies have to be reconciled with the
bank.
9.4 The Borrower will work towards ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG maintaining adequate
insurance coverage with respect to its assets and its business
activities, corresponding to the standards of this business.
9.5 Exercise of voting rights resulting from the acquired shares in ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ AG in the way that future annual profits of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
AG
from the
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business year 1998 onwards will be fully paid out, if economically
reasonable and if possible under corporate law.
9.6 The Borrower is obliged not to make any interest payments or repayment
of loan capital under shareholder's loans until the loan [should read:
the loan under this loan agreement] has fully been repaid.
9.7 During to the duration of this loan the Borrower is obliged not make
available to other creditors any share of direct subsidiaries as
collateral.
9.8 If during the duration of this credit the Borrower is granted a
shareholder's loan from Decora, the respective loan agreement has to be
submitted to the bank.
9.9 Presentation of a "fairness opinion" with which the Bank is satisfied,
at the latest 4 weeks after signing of this loan agreement.
9.10 Presentation of evidence with respect to the legal validity and
enforceability of the declarations of Decora pursuant to nos. 8.2 and
8.3 (Certificate of Resolution pursuant to form no. A 1604 g (ANNEX
9.10A), Certificate of Incumbency and Signature pursuant to form no. A
1604 h (ANNEX 9.10B), Legal Opinion pursuant to form no. A 1604 k (ANNEX
9.10C), with which the Bank is satisfied), within 4 weeks after signing
of this loan agreement.
10. CONDITIONS OF PAYMENT
The payment of the loaned funds will be effected upon receipt of the following
documents and evidence with which the Bank is satisfied:
10.1 Legally valid and binding purchase agreement with respect to the
acquisition of shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG along with confirmation of
the Borrower that no breach of contract by ▇▇▇▇ Holding KG or
Baden-Wurttembergische Bank AG or Decora Industries Inc. or the Borrower
has occured and no termination right or unconditional right of
withdrawal of any contractual party under the purchase
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agreements (ANNEXES 1A AND 1B) exists.
10.2 Signing and execution of this loan agreement.
10.3 "Letter of Intent" of ▇▇▇▇▇▇▇▇ Street Capital Advisors, L.L.C. pursuant
to letter of September 24, 1997 (ANNEX 10.3).
10.4 Evaluation of the transaction structure from a tax law perspective by
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Frankfurt am Main.
10.5 Legal evaluation of the transaction structure, including cartel law
issues, by Oppenhoff & ▇▇▇▇▇▇, Munich.
10.6 Legally valid and binding creation of security interests in accordance
with no. 8 of this loan agreement.
10.7 Payment of equity of the Borrower in the total amount of DM 26,689,250.-
to the account no. 9 190 600 00 of the Borrower at Dresdner Bank AG
under the sole condition that these amounts may only be disposed of upon
payment of the loan.
10.8 Extract from the commercial register of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG.
10.9 Articles of association of the Borrower and charter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
AG.
10.10 No breach of the conditions pursuant to no. 9 of this loan agreement.
10.11 No termination rights pursuant to no. 11 of this loan agreement.
10.12 At the date of conclusion of this loan agreement up-to-date quarterly
figures concerning the development of business of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG.
10.13 No substantial changes of the economical and financial conditions and
the business perspectives of the Borrower and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG.
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10.14 No current litigation/legal disputes against the Borrower which
substantially impair the economical and financial conditions.
10.15 Confirmation by Decora that the investment and maintenance measures to
be taken at ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG during the duration of this loan do not
exceed in total an amount of DM 10,000,000.- p.a.
10.16 Giving of an irrevocable payment order for payment of the purchase
prices pursuant to the provisions of the share purchase agreements
(Annex 1a and 1b).
11. TERMINATION RIGHTS
Irrespective of termination rights resulting from the AGB of Dresdner Bank AG,
the Bank has the right to terminate the loan in part or in total and to call in
the loan for immediate repayment and to make use of the collateral, if
11.1 the purpose of use according to no. 3 is not met or
11.2 a condition of payment according to no. 10 is not met or ceased to exist
subsequently, or
11.3 one or several conditions pursuant to no. 9 are not complied with by the
Borrower, although having been granted in a time period of 20 banking
days, irrespective of whether or not the Borrower was able to influence
compliance with these conditions, or
11.4 the Borrower is in default of payment of the agreed interest or
repayment of the loan, or
11.5 the Bank discovers that further substantial contractual obligations have
been breached by the Borrower, or
11.6 the statements with respect to the assets and earnings conditions of the
Borrower or of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG subsequently turn out to be
incorrect or incomplete
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with respect to substantial points, or
11.7 composition or bankruptcy proceedings or comparable proceedings are
opened or applied for with respect to the Borrower or a company of the
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG group, or
11.8 further circumstances occur or become known by which the repayment of
the loan is substantially endangered, or
11.9 the Borrower has not acquired at least 75 % of shares in ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ AG within 18 months from the signing of this loan agreement,
and the restructuring of the existing payment obligations of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ AG has not been effected under the leadership of Dresdner
Bank AG within this period of time.
11.10 a public offer for taking over all shares in ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ AG which
are not owned by the Borrower has not been made within 18 months from
the signing of this loan agreement, while the ratio between own funds
contributed to the financing of the acquisition and debt after
completion of the "second step" must be 47 % to 53 %.
The Borrower is obliged to immediately inform the Bank in writing about the
arising of any termination right or about any circumstances which might lead to
a termination right.
12. LENDING BANK OFFICE
Dresdner Bank AG in Stuttgart.
13. EXPENSES
Expenses which are or will be incurred in the course of reviewing,
structuring and completion of this loan agreement (external legal,
consultancy and auditing fees as
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well as all costs of providing, management and realization of
collateral) shall be borne by the Borrower.
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14. PLACE OF VENUE AND PLACE OF PERFORMANCE
Place of venue and place of performance is Stuttgart. The laws of the
Federal Republic of Germany are applicable.
15. SYNDICATION
The Bank is entitled any time to syndicate to other banks a partial
amount or several partial amounts, respectively, of the financing. In
this context, vis-a-vis banks which are likely to participate in the
syndication, all information may be disclosed which in the opinion of
the Bank are necessary for the syndication. The choice of syndicating
partners will be reconciled with the Borrower.
It is intended to achieve the credit financing which is necessary in
order to implement the "second step" as described in the Preamble in the
course of a syndication by way of a consortium loan agreement under the
leadership of Dresdner Bank AG. The consortium loan agreement shall be
prepared in close accordance with the term sheet of August 20, 1997
which Decora has received and with this loan agreement. The ratio
between contributed owned funds and debt will be 47 % to 53 % after
completion of the "second step".
The Bank will endeavour in close co-operation with the Borrower to
successfully syndicate this loan and to set up the consortium.
16. MISCELLANEOUS
Should any of the foregoing provisions be invalid or unenforceable, the
remaining provisions shall not be affected thereby. The parties will
replace an invalid or unenforceable provision by a provision which
corresponds as closely as possible to the economical result of the
unenforceable or invalid provision. If it turns out later on that this
loan agreement contains one or several gaps, the same applies mutatis
mutandis.
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In addition thereto, the AGB of Dresdner Bank AG are applicable.
If rights under this loan agreement are temporarily or partly not
asserted, this does not limit in any way those rights unless Dresdner
Bank AG expressly waives such rights in writing.
Changes of or amendments to this loan agreement require written form.
This applies also to the abolition of this clause.
Frankfurt am Main, this September 29, 1997
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Dresdner Bank AG, Stuttgart
We agree to the loan agreement between the Borrower and the Bank of September
29, 1997, in particular to nos. 8.2, 8.3, 8.4, 8.5, 9.5 and 9.6. We undertake to
procure that the obligation concerning us will be met and that the shareholders'
resolutions which are necessary in this respect will be adopted.
Frankfurt am Main, September 29, 1997
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Decora Industries Inc., New York