EXHIBIT 10.24
FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
(this "First Amendment") is dated as of August 30, 2001 among AVONDALE ▇▇▇▇▇,
INC. (the "Borrower"), the BANKS listed on the signature pages hereof
(collectively, the "Banks"), and WACHOVIA BANK, N.A. as Agent (the "Agent");
W I T N E S S E T H :
WHEREAS, the Borrower, the Agent and the Banks executed and delivered
that certain Second Amended and Restated Credit Agreement, dated as of September
28, 2000 (the "Credit Agreement");
WHEREAS, the Borrower has requested and the Agent and the Banks have
agreed to certain amendments to the Credit Agreement, subject to the terms and
conditions hereof;
NOW, THEREFORE, for and in consideration of the above premises and
other good and valuable consideration, the receipt and sufficiency of which
hereby is acknowledged by the parties hereto, the Borrower, the Agent and the
Banks hereby covenant and agree as follows:
1. Definitions. Unless otherwise specifically defined herein,
each term used herein which is defined in the Credit Agreement shall have the
meaning assigned to such term in the Credit Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Credit Agreement shall from and after the date hereof refer to
the Credit Agreement as amended hereby.
2. Global Amendments. The Coosa Bonds have been redeemed and paid
in full and the Coosa Bonds Letter of Credit has been cancelled. Accordingly,
all references in the Credit Agreement and any other Operative Documents to the
Coosa Bonds, the Coosa Bonds Indenture, the Coosa Bonds Issuer, the Coosa Bonds
Letter of Credit, the Coosa Bonds Letter of Credit Expiration Date, the Coosa
Bonds Letter of Credit Fee, the Coosa Bonds Letter of Credit - Principal
Component, the Coosa Bonds Letter of Credit Obligations, the Coosa Bonds Letter
of Credit - Interest Component, the Coosa Bonds Letter of Credit Related
Documents, the Coosa Bonds Notice of Non-Extension, the Coosa Bonds
Reimbursement Agreement, the Coosa Bonds Reimbursement Note, the Coosa Bonds
Reimbursement Obligations, the Coosa Bonds Reinstatement Reserve, the Coosa
Bonds Tender Advance, the Coosa Bonds Tender Drawing and the Coosa Bonds
Trustee, and all related provisions, hereby are deleted and shall have no
further force or effect.
3. Amendment to Section 1.01. Section 1.01 of the Credit
Agreement hereby is amended by (i) deleting the definitions of "Borrowing",
"Commitment", "Current Maturities of Long Term Debt", "Notes", "Related Fund",
"Refunding Loan", "Required Banks" and "Revolver Loan", and substituting
therefor the new definitions of such terms (other than Related Fund) set forth
below, and (ii) adding the new definitions of "First Amendment Effective Date",
"Senior Debt to Cash Flow Ratio", "Term Loan", "Term Loan Maturity Date" and
"Term Loan Notes" set forth below.
"Borrowing" means a borrowing hereunder consisting of Revolver
Loans, Swing Loans or Term Loans (which must be Refunding Loans, except
for the Term Loan Borrowing on the Term Loan Commitment Date). A
Borrowing is a "Domestic Borrowing" if such Loans are Domestic Loans or
a "Euro-Dollar Borrowing" if such Loans are Euro-Dollar Loans. A
Domestic Borrowing is a "Set Rate Borrowing" if such Domestic Loans are
Set Rate Loans or a "Base Rate Borrowing" if such Domestic Loans are
Base Rate Loans.
"Commitment" refers to a commitment of a Bank to make Revolver
Loans and means, with respect to each Bank, the amount set forth
opposite the name of such Bank on the signature pages hereof, as such
amount may be reduced from time to time pursuant to Sections 2.07 and
2.08.
"Current Maturities of Long Term Debt" means all payments in
respect of Long Term Debt (other than the Working Capital Obligations
and the Term Loans) that are required to be made within one year from
the date of determination, whether or not the obligation to make such
payments would constitute a current liability of the obligor under
GAAP.
"First Amendment Effective Date" means August 30, 2001.
"Notes" means the Revolver Loan Notes, the Swing Loan Note
and, from and after the Term Loan Commitment Date, the Term Loan Notes,
or any one, or more, or all of them, as the context shall require,
together with all amendments, consolidations, modifications, renewals,
and supplements thereto.
"Refunding Loan" means a new Loan made on the day on which an
outstanding Loan is maturing or a Base Rate Borrowing for a Loan is
being converted to a Fixed Rate Borrowing, if and to the extent that
the proceeds thereof are used entirely for the purpose of paying such
maturing Loan or Loan being converted, excluding any difference between
the amount of such maturing Loan or Loan being converted and any
greater amount being borrowed on such day and actually either being
made available to the Borrower pursuant to Section 2.02(c) or remitted
to the Agent as provided in Section 2.11, in each case as contemplated
in Section 2.02(d); provided, however, that in order to be a Refunding
Loan, the Refunding Loan must be of the same type (Revolver Loan or
Term Loan) as the maturing Loan or Loan being converted.
"Required Banks" means at any time Banks having at least 66
2/3% of the aggregate amount of the sum of the Commitments and the
outstanding principal amount of the Term Loans or, if the Commitments
are no longer in effect, Banks holding at least 66 2/3% of the sum of
the aggregate outstanding principal amount of the Revolver Loan Notes
and the Term Loan Notes; provided, however, that if a Default is in
existence, for purposes of determining the Required Banks necessary to
waive or amend the conditions contained in Section 3.02(b) the Required
Banks shall be determined without taking into account the Term Loans.
"Revolver Loan" means a Loan made at the same time by the
Banks as a Revolver Loan pursuant to Section 2.01(a) and the other
applicable provisions of Article II, which may be a Base Rate Loan or a
Euro-Dollar Loan, subject to the provisions of Article II.
"Senior Debt to Cash Flow Ratio" means the ratio of
Consolidated Senior Debt to Consolidated Cash Flow, calculated at the
end of each Fiscal Quarter.
"Term Loan" means a Loan made on the Term Loan Commitment
Date, if the Term Loan Commitment Date occurs, as a Term Loan by the
Banks pursuant to Section 2.14 and the other applicable
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provisions of Article II, which may be a Base Rate Loan or a
Euro-Dollar Loan, subject to the provisions of Article II.
"Term Loan Commitment Date" has the meaning set forth in
Section 2.14.
"Term Loan Commitment Notice" has the meaning set forth in
Section 2.14.
"Term Loan Maturity Date" means the first anniversary of the
Term Loan Commitment Date.
"Term Loan Notes" means promissory notes of the Borrower,
substantially in the form of Exhibit A-3, evidencing the obligation of
the Borrower to repay the Term Loans, together with all amendments,
consolidations, modifications, renewals, and supplements thereto.
4. Amendment of Section 2.02. Section 2.02 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 2.02 Method of Borrowing
This Section 2.02 shall apply to all Borrowings other than Set
Rate Borrowings, as to which only Section 2.01(b)(ii) shall apply.
(a) The Borrower shall give the Agent notice (a "Notice
of Borrowing"), which shall be substantially in the form of Exhibit E,
prior to 11:00 a.m. (Atlanta, Georgia time) on the Domestic Business
Day of a Base Rate Borrowing and at least 3 Euro-Dollar Business Days
before each Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a
Domestic Business Day in the case of a
Domestic Borrowing or a Euro-Dollar Business
Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Borrowing,
(iii) whether such Borrowing is to be a Swing Loan
Borrowing, a Revolver Loan Borrowing or a
Term Loan Borrowing, and if a Revolver Loan
Borrowing or Term Loan Borrowing, whether it
is to be a Base Rate Borrowing or a
Euro-Dollar Borrowing, and
(iv) in the case of a Euro-Dollar Borrowing, the
duration of the Interest Period applicable
thereto, subject to the provisions of the
definition of Interest Period; provided,
that if an Anniversary Date is scheduled to
occur during the Interest Period so
selected, and as a result thereof (but for
this proviso) the Borrower shall become
obligated to prepay or repay all or any
portion of the Loans of any type on such
Anniversary Date pursuant to Section
2.08(b), then a portion of such Euro-Dollar
Borrowing which is equal to the amount of
the Loans of such type that would otherwise
be so prepaid or repaid on any such
Anniversary Date either (A) shall have
applicable thereto an Interest Period or
Interest Periods, as selected by the
Borrower, ending on or before the
Anniversary Date on which Loans of such type
corresponding in amount to such portion
would otherwise be prepaid or repaid, or (B)
shall instead be made as a Base Rate
Borrowing.
(b) Upon receipt of a Notice of Borrowing, the Agent
shall promptly notify each Bank of the contents thereof and of such
Bank's ratable share of such Borrowing (unless it is a Swing Loan
Borrowing) and such Notice of Borrowing shall not thereafter be
revocable by the Borrower.
(c) Not later than 11:00 a.m. (2:00 p.m. in the case of a
Base Rate Borrowing) (Atlanta, Georgia time) on the date of each
Revolver Loan Borrowing or Term Loan Borrowing, each Bank shall (except
as provided in paragraph (d) of this Section) make available its
ratable share of such Revolver Loan Borrowing or Term Loan Borrowing,
as applicable, in Federal or other funds immediately available in
Atlanta, Georgia, to the Agent at its address referred to in Section
9.01. Unless the Agent determines that any applicable condition
specified in Article III has not been satisfied, the Agent will make
the funds so received from the Banks available to the Borrower at the
Agent's aforesaid address. Unless the Agent
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receives notice from a Bank, at the Agent's address referred to in or
specified pursuant to Section 9.01, no later than 4:00 p.m. (local time
at such address) on the Domestic Business Day before the date of a
Revolver Loan Borrowing or Term Loan Borrowing stating that such Bank
will not make a Loan in connection with such Revolver Loan Borrowing or
Term Loan Borrowing, as applicable, the Agent shall be entitled to
assume that such Bank will make a Loan in connection with such Revolver
Loan Borrowing or Term Loan Borrowing and, in reliance on such
assumption, the Agent may (but shall not be obligated to) make
available such Bank's ratable share of such Revolver Loan Borrowing or
Term Loan Borrowing to the Borrower for the account of such Bank. If
the Agent makes such Bank's ratable share available to the Borrower and
such Bank does not in fact make its ratable share of such Revolver Loan
Borrowing or Term Loan Borrowing available on such date, the Agent
shall be entitled to recover such Bank's ratable share from such Bank
or the Borrower (and for such purpose shall be entitled to charge such
amount to any account of the Borrower maintained with the Agent),
together with interest thereon for each day during the period from the
date of such Revolver Loan Borrowing or Term Loan Borrowing until such
sum shall be paid in full at a rate per annum equal to the rate at
which the Agent determines that it obtained (or could have obtained)
overnight Federal funds to cover such amount for each such day during
such period, provided that any such payment by the Borrower of such
Bank's ratable share and interest thereon shall be without prejudice to
any rights that the Borrower may have against such Bank. If the Agent
does not exercise its option to advance funds for the account of such
Bank, it shall forthwith notify the Borrower of such decision. Unless
the Agent determines that any applicable condition specified in Article
III has not been satisfied, Wachovia will make available to the
Borrower at Wachovia's Lending Office the amount of any such Borrowing
which is a Swing Loan Borrowing.
(d) If any Bank makes a new Revolver Loan or Term Loan
hereunder on a day on which the Borrower is to repay all or any part of
an outstanding Revolver Loan or Term Loan from such Bank, such Bank
shall apply the proceeds of its new Loan to make such repayment as a
Refunding Loan and only an amount equal to the difference (if any)
between the amount being borrowed and the amount of such Refunding Loan
shall be made available by such Bank to the Agent as provided in
paragraph (c) of this Section, or remitted by the Borrower to the Agent
as provided in Section 2.11, as the case may be.
(e) Notwithstanding anything to the contrary contained in
this Agreement, no Fixed Rate Borrowing may be made if there shall have
occurred a Default or an Event of Default, which Default or Event of
Default shall not have been cured or waived.
(f) In the event that a Notice of Borrowing fails to
specify whether the Loans comprising such Borrowing are to be Base Rate
Loans or Euro-Dollar Loans, such Loans shall be made as Base Rate
Loans. If the Borrower is otherwise entitled under this Agreement to
repay any Loans maturing at the end of an Interest Period applicable
thereto with the proceeds of a new Borrowing, and the Borrower fails to
repay such Loans using its own moneys and fails to give a Notice of
Borrowing in connection with such new Borrowing, a new Borrowing shall
be deemed to be made on the date such Loans mature in an amount equal
to the principal amount of the Loans so maturing, and the Loans
comprising such new Borrowing shall be Base Rate Loans.
(g) Notwithstanding anything to the contrary contained
herein, there shall not be more than 10 Fixed Rate Loans outstanding at
any given time.
5. Amendment of Section 2.03. Section 2.03 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 2.03 Notes
(a) The Revolver Loans of each Bank shall be evidenced by
a single Revolver Loan Note payable to the order of such Bank for the
account of its Lending Office in an amount equal to the original
principal amount of such Bank's Commitment. The Swing Loans shall be
evidenced by a single Swing Loan Note payable to the order of Wachovia
in the original principal amount of $12,500,000. The Term Loan of each
Bank shall be evidenced by a single Term Loan Note payable to the order
of such Bank for the account of its Lending Office in an amount equal
to the original principal amount funded by such Bank on the Term Loan
Commitment Date pursuant to Section 2.14.
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(b) Upon receipt of each Bank's Revolver Loan Note
pursuant to Section 3.01 or Term Loan Note pursuant to Section 2.14,
the Agent shall deliver such Note to such Bank. Each Bank (or Wachovia,
with respect to the Swing Loan Note) shall record, and prior to any
transfer of its Note shall endorse on the schedule forming a part
thereof appropriate notations to evidence the date, amount and maturity
of each Loan made by it, the date and amount of each payment of
principal made by the Borrower with respect thereto and, with respect
to a Revolver Loan and Term Loan, whether such Loan is a Base Rate Loan
or Euro-Dollar Loan (and as to Swing Loans, whether such Loans are Base
Rate Loans or Set Rate Loans), and such schedule shall constitute
rebuttable presumptive evidence of the principal amount owing and
unpaid on such Bank's (or Wachovia's) Notes; provided that the failure
of any Bank (or Wachovia) to make any such recordation or endorsement
shall not affect the obligation of the Borrower hereunder or under the
Notes or the ability of any Bank (or Wachovia) to assign its Notes.
Each Bank (and Wachovia) is hereby irrevocably authorized by the
Borrower so to endorse its Notes and to attach to and make a part of
any Note a continuation of any such schedule as and when required.
6. Amendment of Section 2.04. Section 2.04 of the Credit
Agreement hereby is deleted, and the following is substituted therefor: Section
2.04 Maturity of Loans
(a) Each Loan included in any Fixed Rate Borrowing shall
mature, and the principal amount thereof shall be due and payable, on
the last day of the Interest Period applicable to such Borrowing.
(b) Notwithstanding the foregoing, the outstanding
principal amount of the Revolver Loans and Swing Loans, if any,
together with all accrued but unpaid interest thereon, if any, shall be
due and payable on the Termination Date, and the outstanding principal
amount of the Term Loans, if any, together with all accrued but unpaid
interest thereon, if any, shall be due and payable on the Term Loan
Maturity Date.
7. Amendment of Section 2.05(a). Section 2.05(a) of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
(a) "Applicable Margin" means, from and after the First
Amendment Effective Date (including for Loans outstanding on such
date): (i) for any Term Loan which is a Base Rate Loan, 1.75%; (ii) for
any Term Loan which is a Euro-Dollar Loan, 3.75%; (iii) (A) until the
first Performance Pricing Determination Date, for any Revolver Loan
which is a Base Rate Loan, 1.25%, and for any Revolver Loan which is a
Euro-Dollar Loan, 3.25%, and (B) thereafter, for any Revolver Loan
which is a Base Rate Loan and for any Revolver Loan which is a
Euro-Dollar Loan, with respect to each Performance Pricing
Determination Date, the percentage determined as of the end of the
Fiscal Quarter or Fiscal Year just ended by reference to the percentage
shown in the following schedule for such type of Loan, depending on the
level of the Total Debt to Cash Flow Ratio as of the end of such Fiscal
Quarter or Fiscal Year, as determined pursuant hereto; provided,
however, that (i) so long as any Term Loans remain outstanding, and
(ii) at any time (whether or not any Term Loans remain outstanding) the
maximum Total Debt to Cash Flow Ratio permitted by Section 5.06 is
equal to or greater than 4.50 to 1.00, the Applicable Margin for
Revolver Loans shall not go below Level 4 below (but the Borrower may
voluntarily agree at any time when no Term Loans remain outstanding to
reduce the maximum Total Debt to Cash Flow Ratio permitted by Section
5.06 below 4.50 to 1.0, and in such event this proviso shall no longer
be effective).
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Total Debt to < 3.00:1.0 > 3.00:1.0 > 3.50:1.0 > 4.00:1.0 > 4.50:1.0 > 4.75:1.0 > 5.0:1.0
Cash Flow - but - but - but - but - but -
< 3.50:1.0 < 4.00:1.0 < 4.50:1.0 < 4.75:1.0 < 5.00:1.0
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Base Rate 0.00% 0.00% 0.00% 0.50% 0.75% 1.25% 1.75%
Applicable
Margin
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Euro-Dollar 1.75% 2.125% 2.375% 2.625% 2.875% 3.25% 3.75%
Applicable
Margin
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In determining interest for purposes of this Section 2.05 and fees
pursuant to Section 2.06(a), the Borrower and the Banks shall refer to the
Borrower's most recent consolidated quarterly and annual (as the case may be)
financial statements delivered pursuant to Section 5.01(a) or (b), as the case
may be. If such financial statements require a change in interest pursuant to
this Section 2.05 or fees pursuant to Section 2.06(a), the Borrower shall
deliver to the Agent, along with such financial statements, a notice to that
effect, which notice shall set forth in reasonable detail the calculations
establishing the required change. The date which is 10 Domestic Business Days
after receipt by the Agent of such financial statements and notice, commencing
with the financial statements for the first Fiscal Quarter of the 2002 Fiscal
Year, is the "Performance Pricing Determination Date." Any such required change
in interest and fees shall become effective on such Performance Pricing
Determination Date, and shall be in effect until the next Performance Pricing
Determination Date, provided, however, that: (i) for Euro-Dollar Loans, changes
in interest shall only be effective for Interest Periods commencing on or after
the Performance Pricing Determination Date; and (ii) no interest or fees shall
be decreased pursuant to this Section 2.05 or Section 2.06(a) if, on the
Performance Pricing Determination Date, (A) an Event of Default is in existence,
or (B) a Default is in existence which on such date is not an Event of Default
but which becomes an Event of Default; provided, however, that if an Event of
Default exists on the Performance Pricing Determination Date, or a Default
exists and subsequently becomes an Event of Default, any such decrease shall
take effect upon the cure of any such Event of Default.
8. Amendment of Section 2.06(a). Section 2.06(a) of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
(a) The Borrower shall pay to the Agent for the ratable
account of each Bank, a commitment fee, which shall accrue from and
including the First Amendment Effective Date to but excluding the
Termination Date and shall be payable on each April 1, July 1, October
1 and January 1 and on the Termination Date, commencing October 1,
2001, for the quarterly period ending immediately prior to such date
(except that the payment on October 1, 2001 shall be for the period
from the First Amendment Effective Date through September 30, 2001 and
the Borrower also shall pay on such date the commitment fee payable
under the Credit Agreement for the period from July 1 through the First
Amendment Effective Date at the rate provided in the Credit Agreement
as in effect prior to the First Amendment Effective Date). The
commitment fee shall be calculated on the average daily principal
amount of such Bank's Unused Commitment during such period at the rate
per annum (expressed below as a decimal) of: (A) until the first
Performance Pricing Determination Date, 0.50%, and (B) thereafter, with
respect to each Performance Pricing Determination Date, the percentage
determined as of the end of the Fiscal Quarter or Fiscal Year just
ended by reference to the percentage shown in the following schedule,
depending on the level of the Total Debt to Cash Flow Ratio as of the
end of such Fiscal Quarter or Fiscal Year, as determined pursuant
hereto; provided, however, that (i) so long as any Term Loans remain
outstanding, and (ii) at any time (whether or not any Term Loans remain
outstanding) the maximum Total Debt to Cash Flow Ratio permitted by
Section 5.06 is equal to or greater than 4.50 to 1.00, the commitment
fee shall not go below Level 4 below (but the Borrower may voluntarily
agree at any time when no Term Loans remain outstanding to reduce the
maximum Total Debt to Cash Flow Ratio permitted by Section 5.06 below
4.50 to 1.0, and in such event this proviso shall no longer be
effective).
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Total Debt to < 3.00:1.0 > 3.00:1.0 > 3.50:1.0 > 4.00:1.0 > 4.50:1.0 > 4.75:1.0 > 5.0:1.0
Cash Flow - but - but - but - but - but -
< 3.50:1.0 < 4.00:1.0 < 4.50:1.0 < 4.75:1.0 < 5.00:1.0
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Commitment Fee 0.325% 0.375% 0.50% 0.50% 0.50% 0.50% 0.625%
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9. Amendment of Section 2.07. Section 2.07 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 2.07 Optional Termination or Reduction of Commitments.
At any time upon or after (but not before) payment in full of the Term
Loans, the Borrower may, upon at least 3 Domestic Business Days' notice
to the Agent, terminate at any time, or proportionately reduce the
Unused Commitments from time to time by an aggregate amount of at least
$5,000,000 or any larger multiple of $1,000,000. If the Commitments are
terminated in their entirety, all accrued fees (as provided under
Section 2.06) shall be due and payable on the effective date of such
termination.
10. Amendment of Section 2.08. Section 2.08 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 2.08 Certain Mandatory Prepayments; Mandatory
Reduction and Termination of Commitments.
(a) The Commitments shall terminate on the Termination
Date and any Loans then outstanding (together with accrued interest
thereon) shall be due and payable on such date.
(b) The Borrower shall make mandatory prepayments from
the sources and in the amounts set forth below:
(i) 100% of the Net Cash Proceeds (rounded to
the nearest $500,000) in excess of $5,000,000 of any individual sale of
assets, and in excess of $10,000,000 in the aggregate for all sales of
assets during any Fiscal Year, by the Parent or any of the
Subsidiaries, but excluding (A) sales of inventory in the ordinary
course of business, (B) sales of equipment in the ordinary course of
business, if and to the extent of Net Cash Proceeds used within a
reasonable time to purchase equipment in replacement thereof, (C) sales
of Receivables pursuant to a Receivables Securitization Program (which
shall be subject to clause (ii) below); and
(ii) 100% of the Net Cash Proceeds (rounded to
the nearest $500,000) of the initial sale of Receivables to the
Receivables Subsidiary pursuant to any Receivables Securitization
Program implemented after (but not on or before) the Original Closing
Date, as in existence on the date of implementation thereof, provided,
that (1) with respect to any increase (including, but not limited to a
new series) in an existing Receivables Securitization Program or any
Receivables Securitization Program which is additional to an existing
Receivables Securitization Program (each an "Incremental Program"), the
foregoing shall apply only to the extent of the amount of the Net Cash
Proceeds from the initial sale under the Incremental Program, and (2)
with respect to any Receivables Securitization Program which is a
replacement (a "Replacement Program") for another Receivables
Securitization Program (a "Replaced Program"), the foregoing shall
apply only to the extent of the amount, if any, by which the Net Cash
Proceeds from the initial sale under the Replacement Program exceeds
the Net Cash Proceeds from the initial sale under the Replaced Program.
(c) Each such prepayment shall be applied to reduce the
Term Loans of the several Banks and the Revolver Loans of the several
Banks ratably. Each such prepayment on the Revolver Loans pursuant to
Section 2.08(b) and this paragraph (c) shall be applied to reduce the
Commitments of the several Banks ratably. No optional reduction of the
Aggregate Commitment pursuant to Section 2.07 shall reduce the amount
of any subsequent mandatory prepayment pursuant to Section 2.08(b) or
mandatory reduction pursuant to this paragraph (c).
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11. Amendment of Section 2.10. Section 2.10 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 2.10 Other Mandatory Prepayments on Revolver Loans.
In addition to mandatory prepayments pursuant to Section 2.08(b), on
each date on which the Commitments are reduced pursuant to Section 2.07
or Section 2.08, the Borrower shall repay or prepay such principal
amount of the outstanding Revolver Loans, if any (together with
interest accrued thereon), as may be necessary so that after such
payment the Working Capital Obligations do not exceed the Aggregate
Commitment as then reduced. All such prepayments shall be applied first
to the Revolver Loan Notes and then to the Swing Loan Note.
12. New Section 2.14. The following hereby is added to the Credit
Agreement as Section 2.14.
Section 2.14. Term Loans. As used herein the term "Term Loan
Commitment Date" means the date, if it occurs, specified as the Term
Loan Commitment Date in a notice from some or all of the Banks to the
Borrower and the Agent, with a copy to any Banks not a party thereto,
in substantially the form of Annex 1 hereto (the "Term Loan Commitment
Notice"), setting forth their several commitments to make Term Loans in
the aggregate amount of up to $15,000,000, upon the request of the
Borrower, pursuant and subject to the terms and conditions of this
Agreement and the other Loan Documents; provided, however, that the
Term Loan Commitment Date may not be later than December 31, 2001. On
the Term Loan Commitment Date, on the terms and conditions set forth
herein, each Bank severally agrees to make available to the Borrower a
Term Loan in the aggregate amount set forth in the Term Loan Commitment
Notice. The Term Loans shall be fully funded by the Banks on the Term
Loan Commitment Date, on which date a Term Loan Note shall be executed
and delivered to the Agent for each Bank pursuant to Section 2.03(b).
At the time of funding of the Term Loans, the Borrower shall pay to the
Agent, for the account of each Bank funding the Term Loans, an upfront
fee in an amount equal to 1.0% of the aggregate principal amount of the
Term Loan funded by it. Interest on the Term Loans shall be payable at
the rates and at the times set forth in Section 2.05. On the Term Loan
Maturity Date, a final payment shall be made with respect to the Term
Loans in an amount equal to the remaining outstanding principal amount
of the outstanding Term Loans, together with all accrued but unpaid
interest thereon. Principal amounts of the Term Loans repaid or prepaid
may not be reborrowed, and after the Term Loan Commitment Date, all
Term Loans shall be made as Refunding Loans.
13. Amendment of Section 5.01(c), (d) and (k). Section 5.01(c),
(d) and (k) of the Credit Agreement hereby are deleted, and the following
Sections 5.01(c), (d), (k) and (l) are substituted therefor:
(c) simultaneously with the delivery of each set of
financial statements referred to in paragraphs (a) and (b) above, a
certificate, substantially in the form of Exhibit F (a "Compliance
Certificate"), of the chief financial officer or the chief accounting
officer (i) of the Parent, setting forth in reasonable detail the
calculations required to establish whether there was compliance with
the requirements of Sections 5.03, 5.05 through 5.11, inclusive, on the
date of such financial statements, (ii) of the Borrower, stating
whether, to the Knowledge of such officer, any Default exists on the
date of such certificate and, if any Default then exists, setting forth
the details thereof and the action which the Borrower is taking or
proposes to take with respect thereto, (iii) identifying by name each
Consolidated Subsidiary, and (iv) identifying by name any Material
Subsidiary (other than the Borrower) as to which there has been a
change in excess of $100,000 in its assets, liabilities or
shareholders' equity since the immediately preceding Fiscal Quarter;
8
(d) simultaneously with the delivery of each set of
annual financial statements referred to in paragraphs (a) and (b)
above, a statement of the firm of independent public accountants which
reported on such statements to the effect that nothing has come to
their attention to cause them to believe that any Default existed on
the date of such financial statements under any of Sections 5.03 and
5.05 through 5.09, inclusive;
(k) until the earlier of (1) August 30, 2002 and (2) the
date the Borrower has furnished to the Banks Compliance Certificates
pursuant to Section 5.01(c) for 2 consecutive Fiscal Quarters showing a
Total Debt to Cash Flow Ratio calculated pursuant to Section 5.06 of
less than 3.75, a 13 week rolling cash flow forecast, which shall be
furnished every other Friday, commencing August 31, 2001; and
(l) from time to time such additional information
regarding the financial position or business of the Parent, the
Borrower and the Subsidiaries as the Agent, at the request of any Bank,
may reasonably request.
14. Amendment to Section 5.03. Section 5.03 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 5.03 Fixed Charge Coverage Ratio. The Fixed Charge
Coverage Ratio, calculated at the end of each Fiscal Quarter, shall not
be less than the ratio set forth below for such Fiscal Quarter
FISCAL QUARTER ENDING RATIO
-----------------------------------------------------
-----------------------------------------------------
August 31, 2001 2.25:1.00
-----------------------------------------------------
November 30, 2001 1.90:1.00
-----------------------------------------------------
March 1, 2002 1.90:1.00
-----------------------------------------------------
May 31, 2002 2.25:1.00
-----------------------------------------------------
August 30, 2002 2.50:1.00
-----------------------------------------------------
November 29, 2002 and thereafter 2.75:1.00
-----------------------------------------------------
15. Amendment to Section 5.06. Section 5.06 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 5.06 Total Debt to Cash Flow Ratio. The Total Debt to
Cash Flow Ratio, calculated at the end of each Fiscal Quarter, shall be
less than the ratio set forth below for such Fiscal Quarter
FISCAL QUARTER ENDING RATIO
-----------------------------------------------------
August 31, 2001 4.75:1.00
-----------------------------------------------------
November 30, 2001 5.50:1.00
-----------------------------------------------------
March 1, 2002 5.50:1.00
-----------------------------------------------------
May 31, 2002 4.75:1.00
-----------------------------------------------------
August 30, 2002 4.25:1.00
-----------------------------------------------------
November 29, 2002 and thereafter 3.75:1.00
-----------------------------------------------------
16. Amendment to Section 5.07. Section 5.07 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 5.07. Restricted Payments. The Parent and the Borrower
will not make any Restricted Payment, except, so long as no Default
shall have occurred and be continuing, a Restricted Payment may
9
be made if at the time of such Restricted Payment and after giving
effect thereto: (A) the aggregate amount of such Restricted Payment and
all other Restricted Payments since the beginning of the Restricted
Payment Calculation Period would not exceed the sum of (x) $20,000,000,
plus (y) 50% of Consolidated Net Income during the Restricted Payment
Calculation Period (treated as one accounting period) (or, in case such
Consolidated Net Income shall be a deficit, minus 100% of such
deficit); and (B) the Aggregate Commitment exceeds the Working Capital
Obligations by at least $10,000,000.
17. Amendment to Section 5.08. Section 5.08 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 5.08 Senior Debt to Cash Flow Ratio. The Senior Debt
to Cash Flow Ratio, calculated at the end of each Fiscal Quarter, shall
be less than the ratio set forth below for such Fiscal Quarter
-----------------------------------------------------
FISCAL QUARTER ENDING RATIO
-----------------------------------------------------
August 31, 2001 2.75:1.00
-----------------------------------------------------
November 30, 2001 3.50:1.00
-----------------------------------------------------
March 1, 2002 3.50:1.00
-----------------------------------------------------
May 31, 2002 2.75:1.00
-----------------------------------------------------
August 30, 2002 and thereafter 2.50:1.00
-----------------------------------------------------
10
18. Amendment to Section 5.25. Section 5.25 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 5.25 Collateral.
(a) All manufacturing plants of the Borrower are listed
on Schedule 5.25, which shows, as to each Plant: (i) the City, Town or
other local jurisdiction, and County and State of its location; (ii)
whether the Property on which such Plant is located is owned or leased
by the Borrower, and if leased, the name and address of the owner;
(iii) all Liens on the Property on which such Plant is located; and
(iv) the name, address and type of interest of any Third Party whose
consent is required in connection with the execution, delivery,
recording and performance of a Mortgage as to such Plant or related
Property, and whether such consent has been obtained. If the Borrower
opens any additional manufacturing plants, it shall promptly furnish to
the Agent and the Banks a supplement to Schedule 5.25 including such
additional plant and a Mortgage and appropriate UCC-1 financing
statements requested by the Agent with respect thereto.
(b) It is the intent of the parties hereto that the
Obligations shall be secured by the Collateral (including the Rolling
Stock, if notice is given by the Agent pursuant to the provisions of
Section 4.7 of the Security Agreement), subject to the provisions of
Section 9.18 regarding the release of the Receivables Program Assets.
At the Original Closing Date, the Borrower and the Parent, as
applicable, executed and delivered to the Agent (i) the Security
Agreement and UCC-1 financing statements relating to the personal
property included in the Graniteville Assets, (ii) the Pledge
Agreement, (iii) the Mortgages (undated) and UCC-1 financing statements
relating to the fixtures located at the premises described therein and
(iv) the Borrower Pledge Agreement, the Receivables Subsidiary Pledged
Stock and the Purchase Money Note, and the Agent has released the
Receivables Program Assets pursuant to such Section 9.18. The Mortgages
as to the Revolver Collateral Plants and the SunTrust Collateral Plants
shall be dated and filed on or promptly after the First Amendment
Effective Date (and if requested by the Agent, they shall be amended as
necessary to reflect the Term Loans and any other relevant amendments
to this Agreement since they were originally delivered to the Agent,
and re-executed by the Borrower), and they shall become Operative
Mortgages, and UCC-1 financing statements related to the fixtures
located at the premises described therein shall be filed by the Agent
in accordance with revised Article 9 of the Uniform Commercial Code, as
in effect in the state where such premises are located. The Borrower
pay all recording fees and costs and stamp, intangible or other taxes
payable in connection with the filing for record thereof (collectively,
the "Recording Expenses").
(c) Following the recording of a Mortgage as to any Plant
pursuant to paragraph (b) above, the Borrower will, from time to time
as to individual Plants, at the request of the Agent, deliver to the
Agent at the earliest practicable time all of the Real Property
Documentation relating to such Plant.
(d) As a condition to the effectiveness of the Second
Amendment, AMGF was required to execute and deliver to the Agent the
AMGF Documents. For all purposes under paragraphs (b) through (c),
inclusive, of Section 5.25 (other than the requirement for execution
and delivery on the Original Closing Date), and the rights of the Agent
and the Banks thereunder: (i) the AMGF Security Agreement shall be
subject to the same terms and provisions thereof as apply to the
Security Agreement, as if it were the Security Agreement; (ii) the AMGF
Mortgage shall be subject to the same terms and provisions thereof as
apply to the Mortgages, as if it were a Mortgage; and (iii) the AMGF
Plant shall be subject to the same terms and provisions thereof as
apply to the Plants, as if it were a Plant (and for such purposes shall
be treated as if it were a Revolver Collateral Plant).
19. Amendment of Section 6.01(b). Section 6.01(b) of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
11
(b) the Borrower or the Parent shall fail to observe or
perform any covenant contained in: (1) Sections 5.02(ii), 5.03, 5.05 to
5.08, inclusive, Sections 5.11 or 5.18; or (2) the covenant contained
in Section 5.01(k), if such failure under Section 5.01(k) shall not
have been cured within 1 Domestic Business Day.
20. Amendment of Section 9.08. Section 9.08 of the Credit
Agreement hereby is deleted, and the following is substituted therefor:
Section 9.08 Successors and Assigns.
(a) The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that the
Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Bank
(and any attempted assignment or transfer by the Borrower without such
consent shall be null and void). Nothing in this Agreement, expressed
or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted
hereby and, to the extent expressly contemplated hereby, the Related
Parties of each of the Agent and the Banks) any legal or equitable
right, remedy or claim under or by reason of this Agreement.
(b) Any Bank may assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans at the time
owing to it); provided that (i) except in the case of an assignment of
the entire remaining amount of the assigning Bank's Commitment and the
Loans at the time owing to it or in the case of an assignment to a Bank
or an Affiliate of a Bank or an Approved Fund with respect to a Bank,
the aggregate amount of the Commitment (which for this purpose includes
Loans outstanding thereunder) or principal outstanding balance of the
Term Loan of the assigning Bank subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect
to such assignment is delivered to the Agent) shall not be less than
$5,000,000, in the case of any assignment of a Revolving Loan, or
$1,000,000, in the case of any assignment of a Term Loan, unless each
of the Agent and, so long as no Event of Default has occurred and is
continuing, the Borrower otherwise consent (each such consent not to be
unreasonably withheld or delayed), (ii) each partial assignment shall
be made as an assignment of a proportionate part of all the assigning
Bank's rights and obligations under this Agreement with respect to the
Loan or the Commitment assigned, except that this clause (ii) shall not
prohibit any Bank from assigning all or a portion of its rights and
obligations pertaining to Revolver Loans and Term Loans on a non-pro
rata basis, and (iii) the parties to each assignment shall execute and
deliver to the Agent an Assignment and Acceptance, together with a
processing and recordation fee of $3,500, and the Eligible Assignee, if
it shall not be a Bank, shall deliver to the Agent an administrative
questionnaire in a form supplied by the Agent. Subject to acceptance
and recording thereof by the Agent pursuant to paragraph (c) of this
Section, from and after the effective date specified in each Assignment
and Acceptance, the Eligible Assignee thereunder shall be a party
hereto and, to the extent of the interest assigned by such Assignment
and Acceptance, have the rights and obligations of a Bank under this
Agreement, and the assigning Bank thereunder shall, to the extent of
the interest assigned by such Assignment and Acceptance, be released
from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all of the assigning Bank's rights
and obligations under this Agreement and the other Loan Documents, such
Bank shall cease to be a party hereto but shall continue to be entitled
to the benefits of Sections 8.03, 9.03 and 9.04). Any assignment or
transfer by a Bank of rights or obligations under this Agreement that
does not comply with this paragraph shall be treated for purposes of
this Agreement as a sale by such Bank of a participation in such rights
and obligations in accordance with paragraph (d) of this Section.
(c) The Agent, acting solely for this purpose as an agent
of the Borrower, shall maintain at one of its offices in Georgia or
North Carolina a copy of each Assignment and Acceptance delivered to it
and a register for the recordation of the names and addresses of the
Banks, and the Commitments of, and principal amount of the Loans owing
to, each Bank pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive, and the
Borrower, the Agent and the Banks may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Bank
hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary. The Register shall be
12
available for inspection by the Borrower and any Bank, at any
reasonable time and from time to time upon reasonable prior notice.
(d) Any Bank may, without the consent of, or notice to,
the Borrower or the Agent, sell participations to one or more banks or
other entities (a "Participant") in all or a portion of such Bank's
rights and/or obligations under this Agreement (including all or a
portion of its Commitment and/or the Loans owing to it); provided that
(i) such Bank's obligations under this Agreement shall remain
unchanged, (ii) such Bank shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the
Borrower, the Agent and the other Banks shall continue to deal solely
and directly with such Bank in connection with such Bank's rights and
obligations under this Agreement. Any agreement or instrument pursuant
to which a Bank sells such a participation shall provide that such Bank
shall retain the sole right to enforce this Agreement and to approve
any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide that
such Bank will not, without the consent of the Participant, agree to
any amendment, modification or waiver which would (i) change any date
fixed for any scheduled payment of principal of or interest on the
related loan or loans, (ii) change the amount of any principal,
interest or fees due on any date fixed for the payment thereof with
respect to the related loan or loans, (iii) change the principal of the
related loan or loans, (iv) decrease the rate at which either interest
is payable thereon or (if the Participant is entitled to any part
thereof) fee payable hereunder from the rate at which the Participant
is entitled to receive interest or fee (as the case may be) in respect
of such participation, (v) release or substitute all or any substantial
part of the Collateral, except the release of the Receivables Program
Assets pursuant to Section 9.18, or (vi) release the Parent Documents
that affects such Participant. Subject to paragraph (e) of this
Section, the Borrower agrees that each Participant shall be entitled to
the benefits of Sections 2.11(c) and Article VIII to the same extent as
if it were a Bank and had acquired its interest by assignment pursuant
to paragraph (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 9.05(a)
as though it were a Bank, provided such Participant agrees to be
subject to Section 9.05(b) as though it were a Bank.
(e) A Participant shall not be entitled to receive any
greater payment under Section 2.11(c) or Article VIII than the
applicable Bank would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower's prior
written consent. A Participant that is not organized under the laws of
the United States of America or a state, territory or possession
thereof shall not be entitled to the benefits of Section 2.11(c) unless
the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply
with the provisions of the fourth paragraph of Section 2.11(c) as
though it were a Bank.
(f) Any Bank may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to
secure obligations of such Bank, including without limitation any
pledge or assignment to secure obligations to a Federal Reserve Bank;
provided that no such pledge or assignment of a security interest shall
release a Bank from any of its obligations hereunder or substitute any
such pledgee or assignee for such Bank as a party hereto.
For purposes of this Section 9.08, the following terms have
the following meanings.
13
"Eligible Assignee" means (a) a Bank; (b) an Affiliate of a
Bank; (c) an Approved Fund; and (d) any other Person (other than a
natural Person) approved by the Agent and, unless (x) such Person is
taking delivery of an assignment in connection with physical settlement
of a credit derivatives transaction or (y) an Event of Default has
occurred and is continuing, the Borrower (each such approval not to be
unreasonably withheld or delayed). If the consent of the Borrower to an
assignment or to an Eligible Assignee is required hereunder (including
a consent to an assignment which does not meet the minimum assignment
thresholds specified in paragraph (b)(i) of this Section), the Borrower
shall be deemed to have given its consent five Business Days after the
date notice thereof has been delivered to the Borrower by the assigning
Bank (through the Agent) unless such consent is expressly refused by
the Borrower prior to such fifth Business Day.
"Fund" means any Person (other than a natural Person) that is
(or will be) engaged in making, purchasing, holding or otherwise
investing in commercial loans and similar extensions of credit in the
ordinary course of its business.
"Approved Fund" means any Fund that is administered or managed
by (a) a Bank, (b) an Affiliate of a Bank or (c) an entity or an
Affiliate of an entity that administers or manages a Bank.
21. New Exhibits ▇-▇, ▇-▇ ▇▇▇ ▇-▇. ▇▇▇▇▇▇▇▇ ▇-▇ ▇▇▇ ▇-▇ to the
Credit Agreement (forms of Revolver Loan Note and Swing Loan Note, respectively)
hereby are deleted and Exhibits A-1 and A-2 attached hereto are substituted
therefor. Exhibit A-3 attached hereto (form of Term Loan Note) hereby is added
to the Credit Agreement as Exhibit A-3.
22. Replacement of Exhibit E. Exhibit E to the Credit Agreement
(form of Notice of Borrowing) hereby is deleted and Exhibit E attached hereto is
substituted therefor.
23. Replacement of Exhibit F. Exhibit F to the Credit Agreement
(form of Compliance Certificate) hereby is deleted and Exhibit F attached hereto
is substituted therefor.
24. Additional Bank. Each of the parties hereby acknowledges that
it has been advised of the assignment from Wachovia Bank, N.A. to Branch Banking
and Trust Company of a portion of its Commitment in the amount of $4,500,000
(leaving Wachovia Bank, N.A. with a remaining Commitment of $40,500,000), and a
ratable share of outstanding Revolver Loans and risk participations in Letters
of Credit, and that the Lending Office and notice address for purposes of
Section 9.01 of the Credit Agreement of Branch Banking and Trust Company is:
Branch Banking and Trust Company
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇, Jr.
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation: ▇▇▇-▇▇▇-▇▇▇▇
25. Restatement of Representations and Warranties. The Borrower
hereby restates and renews each and every representation and warranty heretofore
made by it in the Credit Agreement and the other Loan Documents as fully as if
made on the date hereof and with specific reference to this First Amendment and
all other Loan Documents executed and/or delivered in connection herewith,
except where such representations and warranties expressly refer to a different
date and except for events which have been disclosed in writing to the Banks and
which are described in any of Sections 4.04, 4.06(a), 4.07 (except the first
sentence), 4.14(b) and (c) or 4.15.
14
26. Effect of Amendment. Except as set forth expressly
hereinabove, all terms of the Credit Agreement and the other Loan Documents
shall be and remain in full force and effect, and shall constitute the legal,
valid, binding and enforceable obligations of the Borrower. The amendments
contained herein shall be deemed to have prospective application only, unless
otherwise specifically stated herein.
27. Ratification. The Borrower hereby restates, ratifies and
reaffirms each and every term, covenant and condition set forth in the Credit
Agreement and the other Loan Documents, as amended hereby, effective as of the
date hereof.
28. Counterparts. This First Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original
and all of which counterparts, taken together, shall constitute but one and the
same instrument.
29. Section References. Section titles and references used in this
First Amendment shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreements among the parties hereto
evidenced hereby.
30. No Default. To induce the Agent and the Banks to enter into
this First Amendment and to continue to make advances pursuant to the Credit
Agreement, the Borrower hereby acknowledges and agrees that, as of the date
hereof, and after giving effect to the terms hereof, there exists (i) no Default
or Event of Default and (ii) no right of offset, defense, counterclaim, claim or
objection in favor of the Borrower arising out of or with respect to any of the
Loans or other obligations of the Borrower owed to the Banks under the Credit
Agreement.
31. Further Assurances. The Borrower agrees to take such further
actions as the Agent shall reasonably request in connection herewith to evidence
the amendments herein contained.
32. Governing Law. This First Amendment shall be governed by and
construed and interpreted in accordance with, the laws of the State of Georgia.
33. Conditions Precedent. This First Amendment shall become
effective only upon: (i) execution and delivery to counsel for the Agent of 6
counterpart signature pages (or 1 faxed signature page, with the 6 originals
transmitted by overnight courier) of this First Amendment by each of the parties
hereto; (ii) execution and delivery to counsel for the Agent of 6 counterparts
(or 1 faxed signature page, with the 6 originals transmitted by overnight
courier) of the Consent and Reaffirmation of Guarantors at the end hereof by
each of the Parent and AMGF; (iii) execution and delivery to counsel for the
Agent, for distribution to the Banks, of each of the Revolver Loan Notes and the
Swing Loan Note (such Revolver Loan Notes and Swing Loan Note being replacements
for the Revolver Loan Notes and Swing Loan Note issued pursuant to the Credit
Agreement, which shall be cancelled and returned to the Borrower); (iv)
re-execution, dating and delivery to counsel for the Agent of the Mortgages
pertaining to the Revolver Collateral Plants and the SunTrust Collateral Plants
(and including such amendments thereto as may be reasonably requested by the
Agent), together with 6 counterparts (or 1 faxed signature page, with the 6
originals transmitted by overnight courier) of updated opinions of local counsel
in the states of Alabama, Georgia, North Carolina and South Carolina in the form
of Exhibit B-2
15
to the Credit Agreement, as to the Mortgages, updating the opinions of such type
which were delivered on the Original Closing Date (which opinions as to the
Mortgages in Alabama and Georgia can be included in the opinions described in
clause (v) below to be delivered by ▇▇▇▇▇▇▇ ▇▇▇▇▇ Rose & White LLP and King &
Spalding), (v) execution and delivery to counsel for the Agent of 6 counterparts
(or 1 faxed signature page, with the 6 originals transmitted by overnight
courier) of an opinion letter (1) of King & Spalding, counsel for the Borrower,
the Parent and AMGF, substantially in the form of Exhibit B-1 to the Credit
Agreement, but limited to this First Amendment, the Notes (including the Term
Notes, if executed and delivered on the Term Loan Commitment Date), and the
Consent and Reaffirmation of Guarantors at the end hereof, and (2) of ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ & White LLP, Alabama counsel to the Borrower, addressing certain
matters referred to in the opinion of King & Spalding; (vi) receipt by counsel
to the Agent of an officer's certificate of the Borrower, to the effect that the
representations and warranties contained in the Credit Agreement are true and
correct as of the date hereof (except where such representations and warranties
expressly refer to a different date) and that no Default or Event of Default is
in existence as of the date hereof; (vii) receipt by counsel to the Agent of a
secretary's certificate of the Borrower, the Parent and AMGF, certifying the
incumbency of the officers signing the First Amendment, the Term Loan Notes
and/or the Consent and Reaffirmation of Guarantors, as applicable, and that no
amendments have been made to the Articles of Incorporation, Bylaws or other
organic documents since September 28, 2000, and that they continue in full force
and effect (or, if there are any such amendments, attaching and certifying
copies thereof), (viii) receipt by counsel to the Agent of good standing
certificates for each of the Borrower, the Parent and AMGF; and (ix) payment to
the Agent (1) for the account of each Bank, of an amendment fee in amount equal
to 0.25% of each Bank's Commitment, and (2) for the Agent's account, of the fees
and expenses payable pursuant to the letter agreement between the Agent and the
Borrower dated August 1, 2001.
[SIGNATURES COMMENCE ON NEXT PAGE]
16
IN WITNESS WHEREOF, the Borrower, the Agent and each of the Banks has
caused this First Amendment to be duly executed, under seal, by its duly
authorized officer as of the day and year first above written.
AVONDALE ▇▇▇▇▇, INC.
(SEAL)
By:
------------------
Title:
17
WACHOVIA BANK, N.A., as
Agent and as a Bank (SEAL)
By:
-----------------------
Title:
▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇, ▇.▇.,
as a Bank (SEAL)
By:
-------------------------
Title:
19
FIRST UNION NATIONAL
BANK, as a Bank (SEAL)
By:
---------------------------
Title:
20
REGIONS BANK, as a Bank
(SEAL)
By:
-------------------------
Title:
21
BRANCH BANKING AND
TRUST COMPANY, as a
Bank (SEAL)
By:
-------------------------
Title:
22
CONSENT AND REAFFIRMATION OF GUARANTORS
Each of the undersigned (i) acknowledges receipt of the foregoing First
Amendment to Credit Agreement (the "First Amendment"), (ii) consents to the
execution and delivery of the First Amendment by the parties thereto and (iii)
reaffirms all of its obligations and covenants under (1), as to the Parent, the
Amended and Restated Guaranty Agreement dated as of April 29, 1996 executed by
it, and (2) as to AMGF, the Limited Guaranty Agreement dated as of August 29,
1997 executed by it, and agrees that none of such obligations and covenants
shall be affected by the execution and delivery of the First Amendment. This
Consent and Reaffirmation may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which
counterparts, taken together, shall constitute but one and the same instrument.
AVONDALE INCORPORATED AVONDALE ▇▇▇▇▇ GRANITEVILLE
FABRICS, INC.
By: By:
------------------------------- -------------------------------
Title: Title:
23
EXHIBIT A-1
AMENDED AND RESTATED REVOLVER LOAN NOTE
Atlanta, Georgia
August 30, 2001
For value received, AVONDALE ▇▇▇▇▇, INC., an Alabama corporation (the
"Borrower"), promises to pay to the order of
_________________________________________, a ____________________ (the "Bank"),
for the account of its Lending Office, the principal sum of
___________________________________ and No/100 Dollars ($____________ ), or such
lesser amount as shall equal the unpaid principal amount of each Revolver Loan
made by the Bank to the Borrower pursuant to the Credit Agreement referred to
below, on the dates and in the amounts provided in the Credit Agreement. The
Borrower promises to pay interest on the unpaid principal amount of this Note on
the dates and at the rate or rates provided for in the Credit Agreement.
Interest on any overdue principal of and, to the extent permitted by law,
overdue interest on the principal amount hereof shall bear interest at the
Default Rate, as provided for in the Credit Agreement. All such payments of
principal and interest shall be made in lawful money of the United States in
Federal or other immediately available funds at the office of Wachovia Bank,
N.A., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, or such other
address as may be specified from time to time pursuant to the Credit Agreement.
All Loans made by the Bank, the respective maturities thereof, the
interest rates from time to time applicable thereto, and all repayments of the
principal thereof shall be recorded by the Bank and, prior to any transfer
hereof, endorsed by the Bank on the schedule attached hereto, or on a
continuation of such schedule attached to and made a part hereof; provided that
the failure of the Bank to make any such recordation or endorsement shall not
affect the obligations of the Borrower hereunder or under the Credit Agreement.
This Amended and Restated Revolver Loan Note is one of the Revolver
Loan Notes referred to in the Second Amended and Restated Credit Agreement dated
September 28, 2000, as amended by First Amendment to Credit Agreement dated as
of even date herewith among the Borrower, the Banks listed on the signature
pages thereof, and Wachovia Bank, N.A., as Agent (as so amended, and as the same
may hereafter be amended and modified from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used herein with the same
meanings. Reference is made to the Credit Agreement for provisions for the
optional and mandatory prepayment and the repayment hereof and the acceleration
of the maturity hereof.
24
IN WITNESS WHEREOF, the Borrower has caused this Amended and Restated
Revolver Loan Note to be duly executed, under seal, by its duly authorized
officer as of the day and year first above written.
AVONDALE ▇▇▇▇▇, INC. (SEAL)
By:
--------------------------
---------------------- Title:
25
Amended and Restated Revolver Loan Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
Base Rate or Amount Amount of
Euro-Dollar of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
--------------------------------------------------------------------------------------------
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26
EXHIBIT A-2
AMENDED AND RESTATED SWING LOAN NOTE
Atlanta, Georgia
August 30, 2001
For value received, AVONDALE ▇▇▇▇▇, INC., an Alabama corporation (the
"Borrower"), promises to pay to the order of WACHOVIA BANK, N.A., a national
banking association (the "Bank"), for the account of its Lending Office, the
principal sum of Twelve Million, Five Hundred Thousand and No/100 Dollars
($12,500,000), or such lesser amount as shall equal the unpaid principal amount
of each Swing Loan made by the Bank to the Borrower pursuant to the Credit
Agreement referred to below, on the dates and in the amounts provided in the
Credit Agreement. The Borrower promises to pay interest on the unpaid principal
amount of this Swing Loan Note at the rate provided for Base Rate Loans on the
dates provided for in the Credit Agreement. Interest on any overdue principal of
and, to the extent permitted by law, overdue interest on the principal amount
hereof shall bear interest at the Default Rate, as provided for in the Credit
Agreement. All such payments of principal and interest shall be made in lawful
money of the United States in Federal or other immediately available funds at
the office of Wachovia Bank, N.A., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, or such other address as may be specified from time to time pursuant
to the Credit Agreement.
All Swing Loans made by the Bank, the respective maturities thereof,
and all repayments of the principal thereof shall be recorded by the Bank and,
prior to any transfer hereof, endorsed by the Bank on the schedule attached
hereto, or on a continuation of such schedule attached to and made a part
hereof; provided that the failure of the Bank to make any such recordation or
endorsement shall not affect the obligations of the Borrower hereunder or under
the Credit Agreement.
This Amended and Restated Swing Loan Note is the Swing Loan Note
referred to in the Second Amended and Restated Credit Agreement dated September
28, 2000, as amended by First Amendment to Credit Agreement dated as of even
date herewith among the Borrower, the Banks listed on the signature pages
thereof, and Wachovia Bank, N.A., as Agent (as so amended, and as the same may
hereafter be amended and modified from time to time, the "Credit Agreement").
Terms defined in the Credit Agreement are used herein with the same meanings.
Reference is made to the Credit Agreement for provisions for the optional and
mandatory prepayment and the repayment hereof and the acceleration of the
maturity hereof.
27
IN WITNESS WHEREOF, the Borrower has caused this Amended and Restated
Swing Loan Note to be duly executed, under seal, by its duly authorized officer
as of the day and year first above written.
AVONDALE ▇▇▇▇▇, INC. (SEAL)
By:
----------------------------------
Title:
--------------------------------
28
Amended and Restated Swing Loan Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
Amount of Base Rate or Principal Notation
Date Loan Set Rate Loan Repaid Maturity Made By
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29
EXHIBIT A-3
TERM LOAN NOTE
Atlanta, Georgia
----------------
For value received, AVONDALE ▇▇▇▇▇, INC., an Alabama corporation (the
"Borrower"), promises to pay to the order of ________________________________, a
____________________ (the "Bank"), for the account of its Lending Office, the
principal sum of ___________________________________ and No/100 Dollars
($________), or such lesser amount as shall equal the unpaid principal amount of
each Term Loan made by the Bank to the Borrower pursuant to the Credit Agreement
referred to below, on the dates and in the amounts provided in the Credit
Agreement. The Borrower promises to pay interest on the unpaid principal amount
of this Note on the dates and at the rate or rates provided for in the Credit
Agreement. Interest on any overdue principal of and, to the extent permitted by
law, overdue interest on the principal amount hereof shall bear interest at the
Default Rate, as provided for in the Credit Agreement. All such payments of
principal and interest shall be made in lawful money of the United States in
Federal or other immediately available funds at the office of Wachovia Bank,
N.A., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, or such other
address as may be specified from time to time pursuant to the Credit Agreement.
All Loans made by the Bank, the respective maturities thereof, the
interest rates from time to time applicable thereto, and all repayments of the
principal thereof shall be recorded by the Bank and, prior to any transfer
hereof, endorsed by the Bank on the schedule attached hereto, or on a
continuation of such schedule attached to and made a part hereof; provided that
the failure of the Bank to make any such recordation or endorsement shall not
affect the obligations of the Borrower hereunder or under the Credit Agreement.
This Term Loan Note is one of the Term Loan Notes referred to in the
Second Amended and Restated Credit Agreement dated as of September 28, 2000, as
amended by First Amendment to Second Amended And Restated Credit Agreement dated
as of August 30, 2001 among the Borrower, the Banks listed on the signature
pages thereof, and Wachovia Bank, N.A., as Agent (as so amended, and as the same
may hereafter be amended and modified from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used herein with the same
meanings. Reference is made to the Credit Agreement for provisions for the
optional and mandatory prepayment and the repayment hereof and the acceleration
of the maturity hereof.
IN WITNESS WHEREOF, the Borrower has caused this Term Loan Note to be
duly executed, under seal, by its duly authorized officer as of the day and year
first above written.
AVONDALE ▇▇▇▇▇, INC. (SEAL)
By:
----------------------------
Title:
30
Term Loan Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
Base Rate or Amount of
Euro-Dollar Amount of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
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31
EXHIBIT E
NOTICE OF BORROWING
, 200
----------------------------- ---
Wachovia Bank, N.A., as Agent
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Leveraged Finance
Re: Second Amended and Restated Credit Agreement dated as of
September 28, 2000, as amended by First Amendment to Second
Amended and Restated Credit Agreement dated as of August 30,
2001 (as so amended, and as thereafter amended or supplemented
from time to time, the "Credit Agreement") by and among
Avondale ▇▇▇▇▇, Inc., the Banks from time to time parties
thereto, and Wachovia Bank, N.A., as Agent.
Gentlemen:
Unless otherwise defined herein, capitalized terms used herein shall
have the meanings attributable thereto in the Credit Agreement.
This Notice of Borrowing is delivered to you pursuant to Section 2.02
of the Credit Agreement.
The Borrower hereby requests a [Euro-Dollar Borrowing] [Base Rate
Borrowing] [Swing Loan Borrowing] [which is a Revolver Loan Borrowing] [which is
a Term Loan Borrowing] in the aggregate principal amount of $ to be made on ,
200 , and for interest to accrue thereon at the rate established by the Credit
Agreement for [Euro-Dollar Loans] [Base Rate Loans](1)[The duration of the
Interest Period with respect thereto shall be] [1 month] [2 months] [3 months]
[6 months].
The Borrower has caused this Notice of Borrowing to be executed and
delivered by its duly authorized officer this______ day of________ , 200__.
AVONDALE ▇▇▇▇▇, INC.
By:
----------------------------------------
Title:
--------------------
(1) Swing Loans must be Base Rate Loans.
32
EXHIBIT F
COMPLIANCE CERTIFICATE
Reference is made to the Second Amended and Restated Credit Agreement
dated as of September 28, 2000 , as amended by First Amendment to Second Amended
and Restated Credit Agreement dated as of August 30, 2001 (as so amended, and as
thereafter amended and supplemented and in effect from time to time, the "Credit
Agreement") among Avondale ▇▇▇▇▇, Inc., the Banks from time to time parties
thereto, and Wachovia Bank, N.A., as Agent. Capitalized terms used herein shall
have the meanings ascribed thereto in the Credit Agreement.
Pursuant to Section 5.01(c) of the Credit Agreement, (i)
____________________, the duly authorized ____________________ of Avondale
Incorporated, hereby certifies to the Agent and the Banks that the information
contained in the Compliance Check List attached hereto is true, accurate and
complete as of _______________, ______, and (ii) ____________________, the duly
authorized ____________________ of Avondale ▇▇▇▇▇, Inc. hereby (A) certifies to
the Agent and the Banks that to the Knowledge of such officer, no Default is in
existence on and as of the date hereof and (B) restates and reaffirms that to
the Knowledge of such officer, the representations and warranties contained in
Article IV of the Credit Agreement are true on and as of the date hereof as
though restated on and as of this date, except for events which have been
disclosed in writing to the Banks and which are described in any of Sections
4.04, 4.06(a), 4.07 (except the first sentence), 4.14(b) and (c) or 4.15.
Dated: ____________, 200__.
AVONDALE INCORPORATED
By:
------------------------------------------
Title:
AVONDALE ▇▇▇▇▇, INC.
By:
------------------------------------------
Title:
33
\
1. Fixed Charge Coverage Ratio (Section 5.03)
The Fixed Charge Coverage Ratio, calculated at the end of each
Fiscal Quarter, shall not be less than the ratio set forth below for
such Fiscal Quarter
---------------------------------------------------------
FISCAL QUARTER ENDING RATIO
---------------------------------------------------------
August 31, 2001 2.25:1.00
---------------------------------------------------------
November 30, 2001 1.90:1.00
---------------------------------------------------------
March 1, 2002 1.90:1.00
---------------------------------------------------------
May 31, 2002 2.25: 1.00
---------------------------------------------------------
August 30, 2002 2.50:1.00
---------------------------------------------------------
November 29, 2002 and thereafter 2.75:1.00
---------------------------------------------------------
(a) Consolidated Net Income - Schedule 1 $
----------
(b) Net Interest Expense - Schedule 1 $
----------
(c) income taxes - Schedule 1 $
----------
(d) depreciation - Schedule 1 $
----------
(e) amortization - Schedule 1 $
----------
(f) Dividends - Schedule 1 $
----------
(g) LIFO Adjustments -Schedule 1 $
----------
(h) non-cash write-offs of obsolete or surplus equipment, $
spare parts or real property Schedule 1(2) ----------
(i) sum of (a) plus (b) plus (c) plus (d) plus (e) less (f), $
less or plus (g), as applicable, plus (h) ----------
(j) Current Maturities of Long Term Debt - Schedule 1 $
----------
(k) Net Interest Expense $
----------
(l) sum of (j) plus (k) $
----------
Ratio of (i) to (l)
----------
Requirement =>[2.25 to 1.0]
=>[1.90 to 1.0]
=>[2.25 to 1.0]
=>[2.50 to 1.0]
=>[2.75 to 1.0]
--------------------
(2) Not to exceed $10,000,000 during any period of 4 consecutive
Fiscal Quarters
34
2. Senior Debt to Capitalization Ratio (Section 5.05)
The Senior Debt to Capitalization Ratio, calculated at the end of each
Fiscal Quarter, shall be less than 0.50 to 1.0.
(a) Consolidated Senior Debt - Schedule 2 $
-----------
(b) Consolidated Adjusted Tangible Net Worth - Schedule 3 $
-----------
(c) Subordinated Debt $
-----------
(d) Sum of (a) plus (b) plus (c) $
-----------
Ratio of (a) to (d)
Requirement <0.50 to 1.0
3. Total Debt to Cash Flow Ratio (Section 5.06)
The Total Debt to Cash Flow Ratio, calculated at the end of
each Fiscal Quarter, shall be less than the ratio set forth below for
such Fiscal Quarter
------------------------------------------------------------
FISCAL QUARTER ENDING RATIO
------------------------------------------------------------
August 31, 2001 4.75:1.00
------------------------------------------------------------
November 30, 2001 5.50:1.00
------------------------------------------------------------
March 1, 2002 5.50:1.00
------------------------------------------------------------
May 31, 2002 4.75: 1.00
------------------------------------------------------------
August 30, 2002 4.25:1.00
------------------------------------------------------------
November 29, 2002 and thereafter 3.75:1.00
------------------------------------------------------------
(a) Consolidated Total Funded Debt - Schedule 2 $
----------
(b) Consolidated Net Income - Schedule 1 $
----------
(c) Net Interest Expense - Schedule 1 $
----------
35
(d) income taxes - Schedule 1 $
----------
(e) Depreciation - Schedule 1 $
----------
(f) Amortization - Schedule 1 $
----------
(g) LIFO Adjustments - Schedule 1 $
----------
(h) non-cash write-offs of obsolete or surplus equipment, spare $
parts or real property Schedule 1(3) ----------
(i) sum of (b) plus (c) plus (d) plus (e) plus (f) less or plus $
(g), as applicable, plus (h) ----------
Ratio of (a) to (i)
----------
Requirement <[4.75 to 1.0]
<[5.50 to 1.0]
<[4.75 to 1.0]
<[4.25 to 1.0]
<[3.75 to 1.0]
4. Restricted Payments (Section 5.07)
The Parent and the Borrower will not make any Restricted Payment,
except, so long as no Default shall have occurred and be continuing, a
Restricted Payment may be made if at the time of such Restricted
Payment and after giving effect thereto: (A) the aggregate amount of
such Restricted Payment and all other Restricted Payments since the
beginning of the Restricted Payment Calculation Period would not exceed
the sum of (x) $20,000,000, plus (y) 50% of Consolidated Net Income
during the Restricted Payment Calculation Period (treated as one
accounting period) (or, in case such Consolidated Net Income shall be a
deficit, minus 100% of such deficit); and (B) the Aggregate Commitment
exceeds the Working Capital Obligations by at least $10,000,000.
(a) Cumulative Consolidated Net Income during Restricted Payment $
Calculation Period ----------
(b) 50% of (a) $
----------
(c) Sum of (b) and $20,000,000 $
----------
(d) Aggregate Restricted Payments made during Restricted Payment $
Calculation Period ----------
Limitation (d) may not exceed (c)(4)
----------------------
(3) Not to exceed $10,000,000 during any period of 4 consecutive
Fiscal Quarters
36
5. Senior Debt to Cash Flow Ratio (Section 5.08)
The Senior Debt to Cash Flow Ratio, calculated at the end of
each Fiscal Quarter, shall be less than the ratio set forth below for
such Fiscal Quarter
-----------------------------------------------------------
FISCAL QUARTER ENDING RATIO
-----------------------------------------------------------
August 31, 2001 2.75:1.00
-----------------------------------------------------------
November 30, 2001 3.50:1.00
-----------------------------------------------------------
March 1, 2002 3.50:1.00
-----------------------------------------------------------
May 31, 2002 2.75: 1.00
-----------------------------------------------------------
August 30, 2002 and thereafter 2.50:1.00
-----------------------------------------------------------
(a) Consolidated Senior Debt- Schedule 2 $
----------
(b) Consolidated Net Income - Schedule 1 $
----------
(c) Net Interest Expense - Schedule 1 $
----------
(d) income taxes - Schedule 1 $
----------
(e) Depreciation - Schedule 1 $
----------
(f) Amortization - Schedule 1 $
----------
(g) LIFO Adjustments - Schedule 1 $
----------
(h) non-cash write-offs of obsolete or surplus equipment, spare $
parts or real property Schedule 15 ----------
(i) sum of (b) plus (c) plus (d) plus (e) plus (f) less or plus $
(g), as applicable, plus (h) ----------
Ratio of (a) to (i) ----------
Requirement <[2.75 to 1.0]
<[3.50 to 1.0]
<[2.75 to 1.0]
<[2.50 to 1.0]
6. Loans and Advances (Section 5.09)
Neither the Parent, the Borrower nor any of the Material Subsidiaries
shall make loans or advances to any Person except, so long as no Event
of Default is in existence:
------------------------
(4) In addition, after giving effect to a Restricted Payment, the Aggregate
Commitment must exceed the Working Capital Obligations by at least
$10,000,000
(5) Not to exceed $10,000,000 during any period of 4 consecutive Fiscal
Quarters
37
(A)(i) loans or advances to employees not exceeding $2,000,000
in the aggregate principal amount outstanding at any time, in each case
made in the ordinary course of business and consistent with practices
existing on August 25, 1995; (ii) deposits required by government
agencies or public utilities; and (iii) loans or advances to Wholly
Owned Subsidiaries (other than from the Parent to the Borrower or as
provided in Section 5.09(C)) not exceeding $1,000,000 in the aggregate
outstanding; provided that after giving effect to the making of any
loans, advances or deposits permitted by this Section 5.09(A), the
aggregate of all loans and advances permitted in this Section 5.09(A)
does not exceed $4,000,000;
(B) loans or advances from the Parent to the Borrower or from
the Borrower to the Parent, or from the Borrower to AMGF (i) pursuant
to the AMGF/Graniteville Transaction and within the limits contained in
the definition thereof and (ii) otherwise to fund the ongoing working
capital needs and capital expenditures of AMGF in the ordinary course
of business;
(C) loans or advances to the Receivables Subsidiary evidenced
by a Purchase Money Note; and
(D) other loans or advances (not including any loans and
advances of the types described in clauses (A), (B) or (C) above) in an
aggregate amount, together with Investments permitted by clause (viii)
of Section 5.10, not exceeding the sum of $15,000,000, plus 10% of
positive Consolidated Adjusted Tangible Net Worth as of the date of
measurement.
Calculations with respect to Section 5.09(A):
(a) loans and advances to employees $_________
Limitation $2,000,000
(b) deposits required by government agencies or public utilities $_________
(c) loans or advances to Wholly Owned Subsidiaries (other than $_________
stated exceptions))
Limitation $1,000,000
(d) sum of (a) plus (b) plus (c) $_________
Limitation $4,000,000
Calculations with respect to Section 5.09(D):
(e) loans and advances not permitted by clauses (A), (B) or (C) $__________
38
(f) sum of (a) and amount in paragraph 7(a) $__________
(g) Consolidated Adjusted Tangible Net Worth - Schedule 3 $__________
(g) 10% of (g) $__________
(h) Sum of (h) and $15,000,000 $__________
Limitation--(f) may not exceed (i)
7. Investments (Section 5.10)
Neither the Parent, the Borrower nor any of the Consolidated
Subsidiaries shall make Investments in any Person except as permitted
by Section 5.09 and except Investments in (i) direct obligations of the
United States Government maturing within one year, (ii) certificates of
deposit issued by a commercial bank whose credit is satisfactory to the
Agent, (iii) commercial paper rated A1 or the equivalent thereof by
Standard & Poor's Corporation or P1 or the equivalent thereof by
▇▇▇▇▇'▇ Investors Service, Inc. and in either case maturing within 6
months after the date of acquisition, (iv) tender bonds the payment of
the principal of and interest on which is fully supported by a letter
of credit issued by a United States bank whose long-term certificates
of deposit are rated at least AA or the equivalent thereof by Standard
& Poor's Corporation and Aa or the equivalent thereof by ▇▇▇▇▇'▇
Investors Service, Inc., (v) Investments by Borrower in the Receivables
Subsidiary and obligations consisting of Standard Securitization
Undertakings, (vi) Investments by the Receivables Subsidiary in a
Special Purpose Vehicle and obligations consisting of Standard
Securitization Undertakings, (vii) loans and advances permitted by
Section 5.09, and Investments by the Borrower in AMGF (x) pursuant to
the AMGF/Graniteville Transaction and within the limits contained in
the definition thereof and (y) otherwise to fund the ongoing working
capital needs and capital expenditures of AMGF in the ordinary course
of business, and (viii) other Investments in an aggregate amount on and
after the Closing Date, together with Investments permitted by clause
(D) of Section 5.09, not exceeding the sum of $15,000,000, plus 10% of
positive Consolidated Adjusted Tangible Net Worth as of the date of
measurement.
(a) Other Investments (not permitted by clauses (i) through (vii) $__________
(b) Sum of (a) and Paragraph 6(e) $__________
(c) Consolidated Adjusted Tangible Net Worth - Schedule 3 $__________
(d) 10% of (c) $__________
(e) sum of (d) and $15,000,000 $__________
Limitation--(b) may not exceed (e)
39
8. Negative Pledge (Section 5.11)
Amount of Debt secured by Liens not permitted by Sections 5.11(b) $_________
through 5.11(e), inclusive, and (i) Schedule - 4
Limitation $3,000,000
Amount of Debt secured by all Liens (Schedule 4 and Schedule $_________
5.11 to Credit Agreement)
Limitation $4,000,000
9. List of Consolidated Subsidiaries (Section 5.01(c)(iii)
-------------------------------
-------------------------------
-------------------------------
10. List of Material Subsidiaries (other than the Borrower), if any, as to
which there has been a change in excess of $100,000 in the assets,
liabilities or shareholders' equity thereof since the immediately
preceding Fiscal Quarter.
-------------------------------
-------------------------------
-------------------------------
40
Schedule - 1
Consolidated Net Income for:
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
Total $__________
Net Interest Expense for:
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
Total $__________
Income Taxes for:
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
Total $__________
Depreciation for:
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
Total $__________
Amortization for:
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
Total $__________
41
LIFO adjustments for:
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
Total $__________
Dividends for:
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
Non-cash write-offs of obsolete or
surplus equipment, spare parts or
real property for:
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
_____ quarter 200___ $__________
Current Maturities of Long Term Debt for:
_____ quarter 200___ $__________
Total $__________
42
Schedule - 2
Consolidated Senior Debt and Consolidated Total Funded Debt
INTEREST
RATE MATURITY TOTAL
-------- -------- -----
Secured
_________________________________ $__________
_________________________________ $__________
_________________________________ $__________
_________________________________ $__________
Total Secured $__________
Unsecured (including Capitalized Leases)
_________________________________ $__________
_________________________________ $__________
_________________________________ $__________
Total Unsecured $__________
Redeemable Preferred Stock $__________
Total $__________
Receivable Securitization Program $__________
Other Consolidated Senior Debt
_________________________________ $__________
_________________________________ $__________
_________________________________ $__________
Total Consolidated Senior Debt $__________
Plus Subordinated Debt $__________
Total Consolidated Total Funded Debt $__________
43
Schedule - 3
Consolidated Adjusted Tangible Net Worth
(a) Stockholders' Equity $__________
(b) surplus from write-up of assets subsequent to August 25, 1995(6) $__________
(c) intangible assets(7) $__________
(d) Capital Stock shown as assets(8) $__________
Consolidated Adjusted Tangible Net Worth (sum of (a)
less (b) less (c) less (d)) $__________
--------------
(6) Exclude any write-up in connection with the acquisition of the
Graniteville Assets
(7) Include only to the extent created, incurred or arising on or after the
Original Closing Date, and exclude capitalized transaction costs
incurred in connection with the acquisition of the Graniteville Assets
(8) Include only to the extent created, incurred or arising on or after the
Original Closing Date
44
Schedule - 4
Liens Securing Debt In The Principal
Amount of $50,000 or More which are
Not shown on Schedule 5.11 to Credit Agreement
Relevant Provision
of Section 5.11
Description of Lien Amount of Debt Secured Permitting Same
1. _____________ $_______ __________
2. _____________ $_______ __________
3. _____________ $_______ __________
4. _____________ $_______ __________
5. _____________ $_______ __________
6. _____________ $_______ __________
7. _____________ $_______ __________
8. _____________ $_______ __________
9. _____________ $_______ __________
45
Annex 1
FORM OF TERM LOAN COMMITMENT NOTICE
----------------------
Avondale ▇▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vice Chairman and Chief
Financial Officer
Telecopier number: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation number: ▇▇▇-▇▇▇-▇▇▇▇
Wachovia Bank, N.A.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Leveraged Finance
Telecopier number: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation number: ▇▇▇-▇▇▇-▇▇▇▇
Re: Second Amended and Restated Credit Agreement
dated September 28, 2000, as amended by
First Amendment to Credit Agreement dated as
of August 30, 2001 among the Borrower, the
Banks listed on the signature pages thereof,
and Wachovia Bank, N.A., as Agent (as
amended to date and as it may hereafter be
amended or supplemented from time to time,
the "Credit Agreement"). Terms defined in
the Credit Agreement are used herein with
the same meanings.
Ladies and Gentlemen:
As contemplated and subject to the terms and conditions set forth in
the Credit Agreement, each of the undersigned Banks hereby severally agrees to
make a Term Loan in the amount set forth opposite its name below on
_____________________(9), which is the Term Loan Commitment Date.
-------------------------------------------------------------------------------
NAME OF BANK TERM LOAN COMMITMENT AMOUNT
-------------------------------------------------------------------------------
--------------
(9) Must not be later than December 31, 2001
46
-------------------------------------------------------------------------------
$______________________
-------------------------------------------------------------------------------
$______________________
-------------------------------------------------------------------------------
$______________________
-------------------------------------------------------------------------------
$______________________
-------------------------------------------------------------------------------
Total Term Loan Commitments $______________________
-------------------------------------------------------------------------------
Very truly yours,
[insert signature lines for Banks making Term Loan Commitments]
cc: [insert names of any Banks not making Term Loan Commitments]
47