SECOND AMENDMENT AGREEMENT EXHIBIT 4.06
THIS SECOND AMENDMENT AGREEMENT, dated as of October 31, 1994
(this "Agreement"), is among EL DORADO CHEMICAL COMPANY ("EDC"), SLURRY
EXPLOSIVE CORPORATION ("Slurry"), HOUSEHOLD COMMERCIAL FINANCIAL SERVICES,
INC. ("HCFS"), CONNECTICUT MUTUAL LIFE INSURANCE COMPANY ("Mutual") and C.M.
LIFE INSURANCE COMPANY MUTUAL ("C.M. Life").
BACKGROUND
A. EDC, Slurry and HCFS are parties to the Second Amended and Restated
Working Capital Loan Agreement, dated as of January 21, 1992 (as heretofore
and hereafter amended or supplemented, the "Working Capital Loan Agreement").
B. EDC, Slurry, HCFS, Mutual and C.M. Life are parties to the Amended and
Restated Secured Credit Agreement, dated as of January 21, 1992 (as heretofore
or hereafter amended and supplemented, the "Credit Agreement").
C. EDC, Slurry and HCFS are parties to a First Amendment to Amended and
Restated Secured Credit Agreement dated as of June 30, 1993, which amends the
Credit Agreement.
D. EDC, Slurry, HCFS, Equity Bank for Savings, F.A. and Prime Financial
Corporation ("Prime") are parties to an Amendment Agreement dated March 30,
1994 (the "Amendment Agreement"), which amended the Working Capital Loan
Agreement, the Credit Agreement, and that certain Agreement for Purchase of
Receivables, dated as of March 29, 1994, as amended, between Prime and EDC.
E. EDC, Slurry, HCFS and Prime are parties to: (i) a First Amendment to
Amendment Agreement dated as of August, 1994; and
(ii) a Second Amendment to Amendment Agreement dated as of September 29, 1994,
both of which amend the Amendment Agreement.
F. EDC and Northwest Financial Corporation ("Northwest") are parties to a
Partial Lease Termination Agreement (the "Termination Agreement") dated on or
about October 31, 1994, which terminated that certain Lease Agreement dated
March 7, 1988, between EDC, as tenant, and Northwest, as landlord, only with
respect to two (2) tracts of real property (the "Premises") located in El
Dorado, Arkansas, which Premises are more particularly described at Schedule
"A" attached hereto.
G. Northwest and DSN Corporation are parties to that certain Ground Lease
Agreement dated on or about October 31, 1994 (the "DSN Lease"), wherein
Northwest, as landlord, leased the Premises to DSN, as tenant.
H. DSN and EDC are parties to: (i) that certain Ground Sublease Agreement
of the Ground Lease dated on or about October 31, 1994 (the "EDC Sublease"),
wherein DSN, as sublandlord, leased the Premises to EDC, as subtenant, for
payment of approximately $10.00 per year; (ii) that certain Consulting
Agreement dated on or about October 31, 1994, wherein DSN agreed to provide
certain services to EDC in connection with EDC's operation of the Premises for
a payment of approximately $282,504.00 per year; (iii) that certain DSN Plant
Equipment Lease dated on or about October 31, 1994 (the "Equipment Lease"),
wherein DSN, as landlord, leased the facilities, plant and equipment located
on the Premises to EDC, as tenant, for payment of approximately $2,526,168.00
per year.
I. EDC and The CIT Group/Equipment Financing, Inc. are parties to that
certain Acknowledgement and Consent to Collateral Assignment dated on or about
October 31, 1994 (the "Consent").
J. The parties hereto desire to amend the Working Capital Loan Agreement
and the Credit Agreement in certain respects to reflect the entering into of
the Termination Agreement, the EDC Sublease, the Consulting Agreement, the
Equipment Lease and the Consent. The Termination Agreement, EDC Sublease,
Consulting Agreement, Equipment Lease and Consent are collectively herein
referred to as the "Agreements".
NOW, THEREFORE, in consideration of the foregoing and other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. Capitalized terms used in the this Agreement and not
otherwise defined herein shall have the meanings assigned thereto in either or
both the Working Capital Loan Agreement and the Credit Agreement.
2. Unconditional Purchase Obligations. Notwithstanding any prohibition
contained in any of the Loan Documents, including, without implied limitation:
(i) Section 11.6 of the Credit Agreement; or (ii) Section 11B.7 of the Working
Capital Loan Agreement, HCFS hereby consents to EDC entering into the
Agreements.
3. Transactions with Affiliates. Notwithstanding any prohibition contained
in any of the Loan Documents, including, without implied limitation: (i)
Section 11.11 of the Credit Agreement; and (ii) Section 11B.12 of the Working
Capital Loan Agreement, HCFS, Mutual and C.M. Life hereby consent to EDC
entering into the Agreements.
4. Northwest Leases. Notwithstanding any prohibition contained in any of
the Loan Documents, including, without implied limitation, Section 11.16 of
the Credit Agreement, HCFS, Mutual and C.M. Life hereby consent to EDC
entering into the Termination Agreement.
5. Other Loan Documents. All other provisions of the Loan Documents not
specifically modified by the foregoing are hereby deemed modified as necessary
to reflect HCFS' consent to EDC entering into the Agreements. In the event of
a conflict between the terms of this Agreement and any of the Loan Documents,
the terms of this Agreement will control.
6. Cooperation. The parties hereto hereby agree that they shall cooperate
with each other, in good faith, to execute and deliver such other documents as
such other party may reasonably request in order to further effect the terms
of this Agreement.
7. Condition Precedent. The effectiveness of this Second Amendment
Agreement is conditioned on the execution by the respective parties of the
Termination Agreement, the EDC Sublease, the Consulting Agreement, the
Equipment Lease and the Consent.
8. Miscellaneous. Each Borrower hereby agrees to pay, or reimburse HCFS
for, reasonable attorneys' fees and disbursements, incurred by HCFS in
connection with this Second Amendment Agreement; all such costs and expenses
shall be payable on demand. This Second Amendment Agreement shall be governed
by the internal laws of the State of Illinois. This Agreement may be executed
in any number of counterparts, and by the different parties on different
counterparts, each of which shall constitute an original, but all of which
shall constitute one and the same agreement. The Credit Agreement and the
Working Capital Loan Agreement, both as previously amended and as amended
hereby, remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective duly authorized officers as of
the date above written.
EL DORADO CHEMICAL COMPANY
By_______________________________
Name_____________________________
Title____________________________
SLURRY EXPLOSIVE CORPORATION
By_______________________________
Name_____________________________
Title____________________________
HOUSEHOLD COMMERCIAL FINANCIAL
SERVICES, INC.
By_______________________________
Name_____________________________
Title____________________________
CONNECTICUT MUTUAL LIFE
INSURANCE COMPANY
By_______________________________
Name___________________________
Title__________________________
C.M. LIFE INSURANCE COMPANY
By_______________________________
Name___________________________
Title__________________________
tq994x46.tag